A report from the International Association of Assessing Officers (IAAO) finds that estimated market values of commercial properties in the City of Chicago and Cook County under the previous assessor did not meet industry standards for high-quality assessments.
“Overall, the 2018 estimated market values exhibited significant underassessment and regressivity as well as a lack of uniformity, creating the potential for unfair tax disparities,” the report said.
The new research mirrors the findings of a 2017 investigation by the Chicago Tribune and ProPublica Illinois. The IAAO used more recent data to study the 2018 round of assessments, which affected tax bills mailed in 2019.
“For the new study, the international assessors group looked at 1,643 business property sales throughout Cook County in 2018 and compared the sales prices with the assessed values. It found that in the county as a whole, properties were assessed at a median of 61% of their actual sales price, far from the group’s acceptable range of 90% to 110%,” the Tribune reported. “The comparison was even worse in Chicago, where the median valuation of commercial properties was found to be just 52% of sales prices. For Evanston, the figure was 39%; for Oak Park, 43%.”
The study was funded with a grant from the MacArthur Foundation and is one of several that the new assessor, Fritz Kaegi has commissioned since taking office in late 2018. Kaegi called the most recent study “an acid test of where the system is.”
Under the new administration, the business assessment model has been updated with publicly available information about sales prices and loans.
As a result, the total value of commercial properties in the north suburban region of the county rose by 77% in the last triennial reassessment. The Board of Review granted appeals that brought the overall increase down to 25%.
The south suburban region is currently undergoing a reassessment this year and the assessor has announced his office will review every property class in the county in the wake of the coronavirus pandemic. Property owners won’t know the full effect of the 2020 pandemic assessment changes, if any, until the assessed values are certified after the appeal process has been completed. The second installment 2020 property tax bills will be released next summer.