Property taxes: Citizens must have a say
By WILLIAM H. SHAFER
In December Illinois Issues published a column by Charles N. Wheeler III on property tax relief ("Razzle-dazzle on property tax relief," pp. 8-9). I offer the following comments on the subject based on my experience as township assessor for Oak Park, Cook County, during the 1986 reassessment.
In my opinion the property tax revolt in Cook County began with these reassessments of the southern and western suburban areas by the Cook County assessor three years ago.
The assessed valuation of all property in Oak Park Township went up 44 percent in 1986 due to the increased market value of real estate since the previous reassessment in 1982. The 44 percent increase was the highest of any reassessed area. The concern of property owners that reassessment would result in substantial increases in their individual property taxes was verified when the second-half tax bills were issued in August 1987. Total property taxes collected in 1987 from Oak Park were $46.5 million, $5.3 million more than the preceeding year.
Although 7 percent of Oak Park property owners filed complaints during the 20-day period after notices of proposed new assessments were mailed, the tax shock did not become apparent to most property owners until the second-half tax bills were issued. It was the demand by mortgage holders for an additional payment to make up deficits in tax escrow accounts before the tax bill due date that seemed to cause much distress.
It is my observation that the annual impact of property tax increases does not hit most property owners until the tax bills arrive. By then it is too late for changes. Public hearings on proposed budgets are not well attended or effective in controlling spending. The average citizen does not possess the detailed knowledge of the functioning and policies of each governmental unit necessary to make intelligent suggestions for change. Truth in taxation hearings are a charade. By the time they are held, citizens elected to school boards, village councils and other local governmental bodies have spent a lot of time during budget preparation considering programs and spending for their respective jurisdictions. Board members are not likely to change their minds at this late date. Rarely has a truth in taxation hearing ever produced a levy reduction.
Real tax reform must consider the whole process and make changes that will allow citizens to put effective pressure on the governmental units making spending decisions
There is also a lack of knowledge about the cumulative effect each governmental unit levy will have on the overall tax bill. Each board is concerned with the job its members were elected to perform. School board members are concerned with education, village boards about police and other municipal services, park districts with their job and so on. With this fragmented process, the combined effect of their individual decisions is not apparent until all levies are assembled, the equalization factor calculated and the tax bill prepared.
Real tax reform must consider the whole process and make changes that will allow citizens to put effective pressure on the governmental units making spending decisions.
Let me offer a suggested tax reform measure that could be adopted by the next session of the legislature, a measure that I believe would be effective in control of property taxes. The key provision would be to require the county clerk (at least in Cook County) to issue a preliminary tax bill in March for each parcel of property. This preliminary bill would show a proposed property tax, reflecting the overall effect of proposed levies, equalization factors and reassessment. This would provide each property owner a six-month advance notice of tax change.
The second provision would replace the present series of public hearings on budgets and truth in taxation hearings with a single public hearing by each governmental unit after the preliminary bills were issued. If the new tax is too high for services rendered, the taxpayers could demand that the offending governmental body change plans and reduce spending by filing a downward adjustment in its proposed levy after the public hearings and before the final tax bill is issued.
As Mr. Wheeler notes, "Rising property taxes reflect increased spending by local taxing bodies." Until the property tax system is reformed and the taxpayers are provided an opportunity to force their local elected officials to control spending, property taxes are likely to continue their upward trend because they remain a reliable source of revenue.
William H. Shafer is now serving his third term as assessor of Oak Park Township.
February 1990/Illinois Issues/27