South suburban elected officials say they are “cautiously optimistic” about legislation advancing in the General Assembly that they say would help bring blighted properties back on the tax rolls.
Bills in the Illinois House and Senate would lower tax bills for some commercial and industrial properties, with an eye toward making them more attractive for redevelopment.
That, in turn, could help ease the tax burden on homeowners and other businesses that have had to make up for the loss of property taxes paid on those properties, officials said.
The Southland Tax Reactivation Act is proposed as a pilot program involving sites owned by the Cook County and South Suburban land bank authorities, as well as local municipalities, and within Bloom, Bremen, Calumet, Rich, Thornton and Worth townships.
The House measure was introduced in November 2018 and a companion bill was introduced in the Senate last month.
State Rep. Debbie Meyers-Martin, D-Olympia Fields and a co-sponsor of the House bill, said she is cautiously optimistic the measure will pass.
“It is definitely something we need here in the Southland,” said Meyers-Martin, former mayor of Olympia Fields.
Tyrone Ward, Robbins’ mayor and president of the South Suburban Mayors and Managers Association, said he believes the the legislation has a great chance of being passed, although he and Meyers-Martin said it wouldn’t be a cure-all for the area’s property tax woes.
“There is not one particular strategy that is going to make us whole and address all the problems we have,” Meyers-Martin said.
The land banks can acquire tax-delinquent properties then work to clear back taxes on them and present a potential buyer or developer with a clean, unencumbered title to the site.
The problem is, high tax rates in the south suburbs can scare off buyers, according to Russell Rydin, executive director of the South Suburban Land Bank Authority.
“The taxes far outweigh the value of the property and they just walk away,” he said.
Rydin noted that among the land bank’s holdings are a former oil-change business in Park Forest that had an annual tax bill of $100,000, and a 50,000-square-foot office building in Matteson that carried a hefty bill of $500,000.
Even with back taxes cleared, it would be a struggle for a new owner to generate sufficient revenue from some properties to make it worthwhile, he said.
Properties held by the land banks or municipalities are exempt from paying property taxes, and the goal of the Reactivation Act is to find buyers and get them back on the tax rolls, along with limiting overall taxes on the sites for 12 years as an inducement, according to Kristi DeLaurentiis, executive director of the mayors and managers association.
“In many cases they have been the most distressed properties in a community, languishing,” she said.
Under the proposed pilot program, properties that meet certain criteria, including being owned by a municipality or one of the land banks, would essentially be removed from the property tax system in Cook County.
Instead of an assessment and possible fluctuating tax bill, for the first three years after being certified as part of the program total property taxes would not exceed $100,000 a year, according to DeLaurentiis.
Then, for the next nine years, increases in property taxes would be capped at 5% or the annual increase in the Consumer Price Index, whichever is less.
Although the land bank didn’t have a hand in drafting the legislation, Rydin said it is “designed to give some stability and predictability" to a potential property buyer as to what their tax bill might look like, at least in the near term.
DeLaurentiis said the long-term goal of the program, which could be expanded if the pilot meets with success, is to lower tax rates, and total tax bills, for all regional taxpayers by boosting equalized assessed valuations in communities. That would be accomplished by bringing tax-exempt properties back on the tax rolls and spreading a community’s or school district’s levy request over a larger tax base.
It could also result in more developers and investors who’d previously shunned the south suburbs taking another look at the area, she said.
“The goal is that we become more competitive in the marketplace,” she said.
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March 6, 2020 at 08:18PM