By: Diane Benjamin
Why are many local governments holding tax hearings? Here’s the legal reason:
(35 ILCS 200/18-56)
Sec. 18-56. Legislative purpose. The purpose of this Law is to require taxing districts to disclose by publication and to hold a public hearing on their intention to adopt an aggregate levy in amounts more than 105% of the amount of property taxes extended or estimated to be extended, including any amount abated by the taxing district prior to such extension, upon the final aggregate levy of the preceding year.
What that means is in 2023 each unit of government holding a hearing wants collect more than 105% of what they collected in 2022.
These local governments do not set the TAX RATE, the Assessor does. The local governments set the tax levy meaning they say how much money they want in property taxes.
If that amount is more than 105% of what they wanted last year they have to hold a Tax Hearing. They can say they aren’t raising the Tax Rate because they aren’t. Their actions can result in the Assessor raising the tax rate, so it’s really semantics.
Here’s where it gets difficult to say what’s really happening:
The Assessor sends out notices every year to all property owners stating what the value of the property is for property tax purposes. Some people challenge the value, most don’t.
The Assessor then tells local governments the total assessed value they can tap into for property taxes: EAV – Equalized Assessed Value. Keep in mind 2022 EAV reflects the 2021 value. New construction won’t be fully in the EAV until next year since construction wasn’t completed for a full year until 2022.
Confused yet? You are supposed to be.
Next each unit of government decides how much money they want from property taxes. If they decide to collect the same dollar amount as last year the tax rate can actually decrease. Your taxes won’t decrease however because the value of your property probably increased. Some property tax bills could decrease while others dramatically increase. If you don’t challenge excessive increases to your EAV when the Assessor notifies you, you lose.
All these tax hearings are happening because local units of government want more the 105% of what they collected last year. It is impossible to know yet if the growth in total EAV was created by new construction, rising property values due to the housing shortage, or a combination of both.
One thing is clear: Governments think you are piggy bank. Being fiscally responsible isn’t part of the plan, hiding where they aren’t is.
The actual tax rates won’t be set until each government sets the levy they want. Illinois already has ridiculous property taxes. You can leave the state as many have or start saving now for the fleece next spring. Government never has enough money. These local governments know if tax rates are going to increase based on what they levy. Since they don’t set the rate they use semantics as cover.
Local elections are next April. Few people bother to be informed and actually vote. If they knew these offices steal far more money than Illinois or the Feds do maybe they would actually vote.
Nothing will change until the PEOPLE change.
Not just the elected people – the voters who don’t show up.