Residents go to their alderman for street lights, garbage cans or block party permits. County commissioners field calls about the county hospital or the forest preserves, but one of our most important constituent services is helping homeowners figure out property taxes.
This year, members of my office have seen more than 300 homeowners and sat across from them in an alderman’s office or a school gym. We go through the folders of tax bills, assessments and income tax returns to help them qualify for exemptions or appeals. And there are hundreds more who call the office.
In more than a decade of our office helping thousands of people with their taxes, this year has been the hardest for homeowners due to the volatility of the tax bills, the unexpected increases, the escrow-driven trigger of new, unaffordable mortgage payments and a growing realization that taxes might push people out of their homes and neighborhoods.
Benjamin Franklin said, “Nothing is certain except death and taxes.” But what happens when taxes are certain but not predictable? Homeowners in Cook County are now experiencing volatility in the tax bills that can threaten homeownership.
An analysis of tax bills by the treasurer for tax year 2023, billed this year, showed a median jump of nearly 20%, the largest increase in 29 years. Many taxpayers in Cook County have seen increases of as much as 30%, 40%, even 50%.
Volatility alone is disruptive, but coupled with property taxes eating up a larger percentage of household income, it could spell disaster.
Multiple national studies have established that households should spend no more than 25% to 30% of income for housing costs. Research by Fannie Mae shows that property taxes account for about 16% of housing costs on average. This implies that property taxes should account for no more than about 5% of household income in order to keep total housing costs below threshold. But an analysis of property tax bills and income data by the University of Chicago shows that nearly 250,000 Cook County homeowners pay twice that.
And it is truly dire for seniors — especially those in gentrifying neighborhoods. Increasing taxes and fixed incomes can lead to forced moves. The “Senior Freeze” tax exemption was meant to help, but it has not kept pace with inflation or even been adjusted since 1987.
In an area of study including the Logan Square, Irving Park and Avondale neighborhoods, 37% of senior homeowners paid more than 20% or more of their gross annual income for property taxes. For many households, there may be no choice but to sell, forcing seniors out of longtime homes and neighborhoods.
There is equal risk in neighborhoods where property values are lower but taxes continue to skyrocket. In Chicago Lawn, Greater Grand Crossing and Englewood, 14% of homeowners paid more than 20% of gross annual income for property taxes. Here, high taxes, interest and late fees can outweigh the equity in a home, leading some to just walk away, often lacking enough equity to buy another home.
Editorial: When government has to subsidize people’s property taxes, something is badly wrong
We saw this firsthand in Cook County 15 years ago when the foreclosure crisis led to the creation of the Cook County Land Bank Authority. Then, returning vacant homes to the tax rolls was the goal; today, it is ensuring those homes never become vacant in the first place.
The Cook County Board is holding a hearing, which I called for in July, to explore the efficacy of a property tax relief fund to offer temporary relief to allow for adjustments to a higher, escrow-driven mortgage or have time to understand options and plan.
Where will the money come from? Every year, Cook County collects interest payments on late property taxes. For 2024, those fees were projected at $35 million, but the treasurer is on track to collect more than $100 million from taxpayers by December — three times the budgeted amount. This, along with other items, created a budget “surplus” in Cook County for 2024, but reinvesting 10% or 20% of these collections to stabilize the very tax base we rely on would usher residents through a time of financial hardship.
State reform is the long-term goal, but homeowners need a lifeline now.
Bridget Gainer is Cook County commissioner of the 10th District and founder and board chair of the Cook County Land Bank Authority.
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