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Chicago Property Tax Burden Escalates

by Philip Utterback, Chicago, January 2021

If the past is any indication of the future, Chicago business owners can expect to pay increasingly expensive property taxes in the years ahead.

 

The trend is evident in a study commissioned by Cook County Treasurer Maria Pappas that documents how local commercial property taxes have grown exponentially.

 

Looking Back

 

In the past 20 years, commercial property taxes in Chicago rose by 81% -- from $1.92 billion to $3.48 billion.

 

The increase was even more dramatic in some Downtown Wards, where triple-digit hikes were reported:

 

 

288% in Ward 27 (annual average 14.4%)

 

208% in Ward 3 (annual average 10.4%)

 

181% in Ward 25 (annual average 9.05%)

 

97% in Ward 42 (annual average 4.85%)

 

The analysis is based on the tax bills sent to Cook County property owners each year from Tax Year 2000 to Tax Year 2019.

 

Looking Forward

 

Chicago property taxes will increase by $94 million to a total property tax levy of $1.6 billion in 2021. The city relies on property taxes to help fund massive pension obligations. Pension payments were $1.2 billion in 2020, and they’re set to grow by another $1 billion by 2023. The pension system now consumes the majority of Chicago’s property tax collection.

 

In addition to this year’s property tax increase, all Chicago properties will be reassessed in 2021. The Cook County Assessor has set a goal to target under-valued downtown properties with significantly higher assessments, which will add to the tax burden of owners.

 

Amid the economic turbulence associated with the global pandemic, proactive appeals of excessive property tax assessments are more important now than ever before.