Not Just To Us Though – This Is City Wide Sticker Shock For Home Owners

I’ve seen tax bills with a 37% increase, and none lower than 30%. At the neighboring building I live in, my own went up 33%. Makes inflation sort of look like chump change!

As a result, I’ve received many questions about the ‘tax appeal’ that Park Tower does, but there is a critical distinction to understand. We don’t file an appeal to lower the taxes. We file to challenge the “assessed valuations” that were determined by the county tax assessor. These valuations are just one of many factors in the calculation that determines what every tax paying parcel is responsible for. To simplify it as much as I dare to, they say how much they believe each property is valued at and we hire an attorney to file a formal challenge, by presenting evidence from the most recent sales data. We did win our most recent appeal. However, the most recent sales data did not help us very much. Values have gone up relatively steadily over the past 3 years. So it was difficult this time around to secure much of a reduction.

Another question I’ve gotten is, what is the point of the “assessed valuations”? What is their importance in helping determine what owners pay for taxes? From a textbook point of view they determine a property’s taxable value. Through the formula used by the powers that be, they would argue the process creates a fair system where each property owner’s share of the total tax burden is at least in part based on their property’s value relative to others in the community.

The assessed value however, is not to be confused with actual market value, as you can see on your bill. It is typically much lower. Ultimately a tax assessment rate is applied to the market value to get the assessed value – which is then used to calculate our individual share of the total tax burden we are individually responsible for. Somewhat similar to how Condo Assessments are determined. The association determines a “total assessment” income item on the annual budget, and that is multiplied by your percentage of ownership, to determine your portion of the assessments. Unlike assessed valuations though, you don’t have an assessor adjusting that percentage of ownership every three years.

So why then the huge increase? The massive tax bill increases is not due to our valuations – directly. They are actual due to a shift in the tax base from commercial properties to residential in Cook County – basically because of all the empty commercial spaces in the City. Those property values have gone down considerably, hence they are paying a much lower share of the taxes. In the process of allegedly equalizing things to make them more equitable, the burden shifted more to residential owners.

Is there anything else we can do? No – not right now – at least not from a practical standpoint. Looking at how Park Tower values have increased in recent years, it would be my opinion our attorney worked a bit of a miracle to get any valuation reduction. However, from a political standpoint perhaps. Use your vote as they say. 

For some, this may create more questions than answers. I’m not here to argue the politics though, just to provide some insight. Feel free to share any questions or concerns you have, and I will help as much as I can. E-mail me at tpatricio@habitat.com.