America's Property Tax Advisor

Illinois Property Tax Freeze May Advance


Time ran out before a proposal to freeze Illinois property tax rates could be approved by the 99th General Assembly. Supporters are hoping the measure will pass in the new legislative session. House Bill 6630 cleared the House on a 76-24 vote. The session ended before it could be approved by the Senate.


Illinois Turnaround


A property tax rate freeze is part of Governor Bruce Rauner's "Turnaround Agenda" for Illinois. It sets a rate cap on all taxing bodies in the state, including home-rule units, which would require them to ask for voter approval to receive an increase in property taxes.


State law created property tax caps for certain counties under the Property Tax Extension Limitation Law. Under PTELL, a taxing district receives a limited inflationary increase in taxes on existing property plus any additional amount for new construction. Thirty-nine counties, including Cook and the Collar Counties are subject to PTELL, which limits tax growth to the lesser of 5% or the increase in the Consumer Price Index.


"We have one of the highest property taxes in America, and a property tax freeze, where you control whether your property taxes go up or not, will help change the system in Illinois, create jobs, and keep families from fleeing the state," Gov. Rauner said.


However, after the Governor’s annual State of the State address on Wednesday, January 25, 2017, Republican Sen. Bill Bradley, of Bloomington, said “GOP senators don’t believe a two-year property tax freeze is enough to offset other tax hikes, etc.”


Tax Freeze Part of a Bigger Issue


This tentative and preliminary property tax freeze is just one of many structural policy reforms the Governor has sought since taking office 2 years ago. The real issue is whether the Democratic-controlled General Assembly and the Republican Governor can approve a state budget deal. Philosophical disagreements between lawmakers and the governor on these proposed policy changes are a major factor behind the budget impasse that has lasted 18 months.


Gov. Rauner has said he will not entertain any tax or revenue increases without concessions on some of his proposed reforms. However, this recent dysfunctional discord in state government has not been without a cost. Some estimates, as reported in the Chicago Tribune recently, indicate the drain is as high as $14 million a day from an already broke state government. From the way it looks, any ultimate property tax freeze for qualifying taxpayers may just be in one hand then out the other if other forms of taxation are enacted to address the mounting shortfalls.


The Governor is still optimistic that a bipartisan compromise can be achieved through the moral obligation of legislative leaders to get a balanced budget with changes to the system (including the proposed temporary property tax freeze) to help job creators and protect taxpayers. In his State of the State address, Rauner said, “the people of Illinois need you (House Members and State Senators) to succeed.”