For the past eight years, Franczek Radelet has tracked property tax assessment data by class of property from the Cook County Assessor’s Office. Our data set begins in tax year 2009 when the classification ordinance was amended to reduce the assessment levels from 38% and 36% to 25% of market value for commercial and industrial property and from 16% to 10% of market value for residential property. The data also captures the effect of the Great Recession and the impact of the housing bubble.
The latest data from the 2016 tax year shows that, although a slow recovery in real estate values continues, the recovery is uneven and incomplete. Because assessments are one part of a complex equation that results in tax bills for taxpayers and tax collections for taxing districts, these trends are important to keep in mind as administrators and elected officials discuss and evaluate the different dimensions of school finance and property taxes.
We have also compiled assessment data by township so that you can analyze the trends on a more local level. Seven years after Cook County revised assessment levels and eight years after the Great Recession, not a single suburban township has seen a full recovery in its total assessed value. The data for each suburban township is available by clicking here.
The most pronounced effect of recent assessment trends is higher tax rates. However, higher tax rates do not necessarily correspond with more money for local taxing agencies. While property tax levies may be growing at or slightly above the rate of inflation, individual tax bills can increase or decrease much more than inflation due to a property’s assessed value in relation to the assessments of neighboring properties. It is important for the public to understand that tax rates and tax bills are not simply the result of the property tax levy.
Finally, commercial and industrial property tax assessment appeals at the Illinois Property Tax Appeal Board (PTAB) or in circuit court should not be underestimated. While residential property has the most assessed value, it also has the largest number of properties. The average assessed value of a residential property in Cook County was $22,951, which corresponds with a market value of $229,517. Meanwhile, the average assessed value of commercial and industrial property was $200,478, which translates to a market value of $800,915. Thus, although numerous, residential property on average has substantially less assessed value at stake if the property taxes are appealed. On the other hand, a single commercial or industrial property with significantly greater assessed value can have a dramatic impact on a taxing agency’s levy if it appeals its assessment and obtains a large refund.