Property Tax Concerns in Illinois

Homeowners receive property tax bills twice a year, and it’s becoming a significant concern.

The NBC 5 Responds team has found several issues within the local tax system. Rather than just highlight these problems, they aim to explore possible solutions. What changes could be made?

According to Kotality data, Illinois homeowners are paying about 24% more in property taxes than they were in 2019. This increase has been particularly burdensome for families living in Chicago’s South and West Sides.

As commercial real estate values have dropped in the Loop, the tax burden has shifted more heavily onto homeowners.

“Illinois ranks as the second-most reliant state on property taxes in the nation,” noted David Merriman, a public policy expert at the University of Illinois at Chicago.

Merriman is quite active in discussions around property tax reform. If he could make changes, his main goal would be to decrease dependency on property taxes in favor of alternative funding methods for schools.

He cites Michigan as a noteworthy example. Over three decades ago, Michigan residents voted to revamp their tax system, leading to reduced reliance on local property taxes for school funding. Instead, they increased the sales tax and established a state education tax.

The Minneapolis-St. Paul metropolitan area has also implemented a unique tax-sharing model that redistributes property tax revenue to enhance equity across its seven counties, as stated by the Lincoln Institute for Land Policy, a nonpartisan think tank.

“This idea has been discussed here for years, but the community tends to be quite insular, making it hard to consider broader regional solutions,” Merriman commented.

In another instance, Florida’s Governor Ron DeSantis has pushed for the elimination of property taxes altogether, expressing concerns about rising property tax assessments and local fees.

However, there are worries about three proposals currently in Florida that might impact city budgets and services.

According to Realtor.com, 13 states have suggested eliminating property taxes, though the urgency varies widely across those states.

“The proposals mainly focus on homeowners, leaving businesses and renters still subject to property taxes, which seems quite unfair,” Merriman added.

Countries have long debated the advantages and disadvantages of their tax structures. A crucial question remains: if we decrease our reliance on property taxes, what alternatives would adequately fund essential services like education, law enforcement, and fire departments?