But with so many landlords challenging the assessments and recording significant reductions, Chicago homeowners as a whole will bear more of the city tax burden this year than in 2021, at 52.1%. (52.8% according to the Assessor’s Office report). Meanwhile, non-residential real estate accounts for his 47.2% of the city’s property tax base this year, up from 47.9% in 2021. Read the report below.
In a zero-sum world of property taxes, this shift makes it more likely that more Chicago homeowners will pay higher taxes this year than some officials expected months ago.
A small change of just 0.7% suggests a status quo outcome, but represents a big win for the city’s commercial real estate industry, which was gearing up for a big tax increase. After Kaegi reassessed the city last year. He boosted Chicago non-residential property valuations by 53.7% in 2021, while residential valuations rose only 21.7%.
Kaegi, who was reelected as an assessor in 2018 and was re-elected last week, believes commercial real estate in the county has long been undervalued and has imposed an excessive tax burden on homeowners. , who complains that he is trying to win voter support, claiming his valuation scares investors and hurts Chicago’s economy.
But the landlord is allied with the county board of review. This is her 3-person board on which property owners can challenge the appraiser’s valuation. The board uses a different valuation method for commercial real estate that is far friendlier to landlords than Kaegi’s.
The review board swept away Kaegi’s nonresidential property price hikes, so the city’s homeowners as a whole will get a slightly larger share of Chicago’s overall property tax tab than they did in 2021. increase. The burden has dropped from 52.1% for him last year to 46.2% for him this year, according to the report.
Meanwhile, Kaegi’s assessment puts non-homeowners at 53.8% of the city’s property tax base, up from 47.9% last year.
But the Board of Review put the burden back on homeowners, who currently bear 52.8% of the city’s tax burden, while nonresident property owners bear 47.2%. Board beneficiaries include Donald Trump’s Chicago hotel. Kaegi’s office valued the 339-room riverside property at $105.3 million for him, but the review board Reduce its value to $73 million.
When asked about his reaction to the judging committee’s actions, Kaegi did not hide his dissatisfaction.
“Choose the adjective shocked. Flubergast? Horrible?” he said.
As a second step in the appeal process, review boards always reduce property values set by assessors. But it was “completely unprecedented” for the board to go this far, Kaegi said. The COVID-19 pandemic has devalued many office and retail facilities, but other facilities, such as data centers and industrial buildings, have actually increased in value over the past few years, he said. .
“As a result of the[board]changes, the property tax base is very skewed,” Kaegi said.
The change would have resulted in hundreds of millions of dollars in property taxes being passed on to Chicago homeowners, which Kaegi assessed would have been paid by non-resident property owners, he said. Individual property owners will be able to find out how much property taxes they have owed when the county publishes their bills online this week.
William O’Sheils, deputy chairman of the review panel, said Kaegi’s position on valuations makes for good politics by taking the burden off homeowners, but not good math.He claims the board uses a long-held and widely-accepted process for valuing commercial real estate, and Kaegi claims it doesn’t.
“It’s just a different methodology,” says O’Shields. “There’s nothing wrong with that.”
Kaegi and the Judging Committee have a hostile relationship, The county property tax bill will be delayed this year. But Kaegi is looking forward to two of the three board members stepping down after failing to run for re-election this year.
Kaegi also plans to reset the value of some commercial properties in Chicago this year to bring them closer to their original valuation. This is a break with the past. Normally, assessors evaluate properties in the county once every three years, but Kaegi decided to make an exception in Chicago due to a review board reduction.