Opportunity deserts in the state are often created when high property taxes have driven out existing businesses and/or inhibited commercial growth. When this occurs, a vicious economic cycle is created that puts a larger tax burden on existing homeowners. And those who most often feel the larger tax burden are seniors, the unemployed, under-employed, poor, and minorities.
Two Illinois towns in Cook County offer prime examples of a huge disparity in property tax rates. In Winnetka, the average household income is $400,000 and the racial makeup includes only 1.8 percent Black or Latino. The commercial property tax rate there is 7.465 percent. By contrast, in Harvey, the average household income is $41,000 and the racial makeup includes 92 percent Black or Latino. The assessed property tax rate there is nearly four times higher at 28.579 percent.
House Bill 4866, filed by Rep. Ozinga and co-sponsored by Rep. Ugaste, would establish an annual program to award property tax relief to school districts in the state. The Fixed Pension Payment Property Tax Relief Plan would tie pension costs and property tax relief into a certain percentage of each year’s budget. And with pension costs going down as a percentage of the overall budget in the coming years, a pool of resources would be created to provide school districts with funds that in turn lower their property tax levy. Once fully implemented, some districts could see a 50 percent reduction in their property tax levy.
The legislation provides that the State Board of Education shall establish and administer a program to award property tax relief grants to school districts in Illinois. It also creates the Education Property Tax Relief Fund as a special fund in the state treasury for the purpose of awarding grants.
Property tax relief leads to organic growth and a way out for areas with opportunity deserts. Illinois House Republicans look forward to working with Democrats to implement these solutions to help provide relief for homeowners and property owners in our state.
“Areas in southern Cook County and around the state have continued to suffer as the situation has worsened,” stated Rep. Ugaste. “We must act to help those of our citizens who are being crushed by these enormous property tax rates.”
“With the passage of this legislation, school districts would be required to lower their property tax levies to an amount equal to the relief,” stated Rep. Ozinga. “The time to ignore this issue has ended, and the problem is not going away. Lawmakers need to step up and provide real solutions to help our most vulnerable residents.”
“The current system has created areas of the state where economic growth is nearly impossible,” former Rep. Batinick stated. “The high property tax rates make it economically unviable for companies to invest in areas even if they have terrific infrastructure. By working to dramatically lower property taxes, we can spur economic growth that can lead to an increase in jobs and decrease in crime.”
Rep. Ugaste further explains how to fix opportunity deserts in this video: