Good News/Bad News for Property Reassessment
By Andrea A. Raila in Real Estate Chicago

The year 2000 has meant reassessment for all Chicago properties, in accordance with Cook County's triennial reassessment cycle, and assessment and tax officials have taken full advantage of Chicago's runaway real estate markets. With individual reassessments ranging from -90% to +400%, the average increases for the first five reassessed Chicago townships were: Roger's Park (26%), Lake View (53%), Lake (14%), West Chicago (37%), and Hyde Park (19%).  North, Jefferson and South Townships are scheduled to receive their reassessment notices in October and November 2000. This years state multiplier increased by 3.78% (from 2.17999 to 2.2505), but the overall Chicago tax rate dropped from 8.872% to 8.536%, effectively eliminating the entire increase of the state multiplier.

That's good news for Chicago property owners for whom tax bills are out and due in October 2000, but these aren't the same rates that will be applied to these new reassessments and reflected on 2001 September tax bills.  Real estate investors dread this kind of tax uncertainly. Cook County's unpredictable tax rates, non-restricted triennial reassessment increases, and unwieldy tax appeal system cast a shadow of anxiety over Chicago's otherwise flourishing real estate markets. Cook County Assessor James. M. Houlihan, who inherited this taxing quagmire, has made some improvements after four years in office, however.  Houlihan's initiatives have brought the Cook County Assessment System close to the 21st century with a Web sit, (www.cookcountyassessor.com) publication of a Freedom of Information Catalogue and creation of a Tax Policy Forum to exchange tax reform ideas.

Another new change in Cook County's tax appeal system is that appeals can now be filed at the State Property Tax Appeal Board. However, property owners should attempt tax reduction through the two county agencies first, the Assessor and the Board of Review. Appeals to the Assessor's Office and the Board of Review are non-adversarial and no public entity can intervene.

The Assessor's Office now also provides estimated mailing dates for reassessed townships and has extended from 30 business days to 45 days the time allowed to file a challenge to proposed reassessment notices.  Even with filing extensions, Chicagoland industrial and commercial property owners should prepare themselves for Cook County's bumpy ride through a crowded tax appeal maze.

Consequently, even the best documented tax inequities may not get the oversight needed for equitable tax relief.

Widespread tax disparities exist among Cook County commercial and industrial properties because of substandard assessment practices or because the assessment system is being reformulated at the state level to keep it in compliance with state law. Industrial property owners see taxes psf from $.90 to as high as $7.50.  Other commercial properties see a tax range from $3.50 to $7 psf. Commercial taxes over $5 psf are well over national averages.

Note well that all reassessment notices say "proposed reassessment" giving each taxpayer an invitation to suggest another assessment figure. Yet many taxpayers do not accept the county's quiet invitation to challenge a reassessment. Faced with the largest, most complex taxing body and appeal system in the country, owners of small-sized industrial properties with limited resources are placed at a competitive disadvantage when strapped with an inequitable assessment.  The number of errors and inaccuracies inherent in a large system make for increasing work for lawyers and tax consultants.

Whether you are working directly with the Assessor's Office, filling the complaint form yourself, or retaining a professional tax consultant or attorney, be prepared to produce the required evidence in a timely manner in order to meet all of the numerous and confusing, but important, deadlines. When a property is only occupied by its owner and has no recent history of rental tenants, often only an appeal backed with a good independent "ad valorem" (value added) appraisal will rectify an over-assessment.