Op-Ed: Illinois’ property taxes are unbearable for everyone

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The Chicago Bears are growling for property tax relief in their quest to build a new stadium-anchored development in suburban Arlington Heights. While no one should get special treatment, the Bears have a real point about high taxes. The property taxes in Cook County are a monumental problem for businesses of all sizes, and the situation is spiraling out of control.

A recent study on the property tax burden in the largest city of all 50 states showed Chicago has the second highest commercial property tax rate at 3.78% of property value. Only Detroit’s and Chicago’s effective tax rate is more than double the national average of 1.86 percent.

In some places in Cook County, it’s even worse. It was announced recently the Bears property in Arlington Heights was valued at $95M, and the one-year tax bill will be $7.8M – or an astronomical 8.2 percent of property value.

The Chicago Bears will be paying taxing bodies more to not play in Arlington Heights this year than they will be paying the Chicago Park District to play at Soldier Field. The $7.8M Arlington Heights property tax bill is more than the $6.48M in rent payment for the use of Soldier Field.

Paying 4.4 times the average national commercial property tax rate is inhospitable for most companies, it may be even more damaging for a company like the Chicago Bears. The Bears haven’t paid property taxes on their current Soldier Field home in over 50 years, as it is a publicly owned stadium.

Now, the Chicago Bears are a fast-growing company valued at $5.8B. The $7.8M property tax burden may be small in comparison, but when it comes to building a state-of-the-art stadium valued at $2.5B, the Bears might be looking at paying $205M in property taxes each year. That’s more than the Bears spent on their entire NFL playing roster in 2022.

This is not just a Chicago Bears problem. The burden of Cook County’s high commercial property taxes falls heavily on local businesses, hindering their ability to grow, expand, and hire new talent. For small and medium-sized enterprises, this can be especially debilitating, as they often lack the resources to absorb these increased costs. Consequently, many businesses have had to downsize, relocate, or even shutter their operations altogether, leaving a trail of job losses and economic stagnation.

The lack of meaningful tax reform and limitations on the growing property tax burden has deterred investment, stifled economic growth, and driven corporations to seek greener pastures elsewhere.

Consequently, many businesses have had to downsize, relocate, or even shutter their operations altogether, leaving a trail of job losses and economic stagnation.

The exodus of corporations from Cook County is more than just a statistical trend; it’s a reflection of a broken system that fails to protect the interests of its own constituents. Companies are not fleeing for tax havens out of mere preference; they are escaping an environment where they feel shackled by burdensome regulations and a lack of fiscal responsibility. As these corporations leave, they take with them jobs, investments, and a considerable chunk of the county’s tax revenue.

Cook County is one of the worst property tax offenders, but the rest of Illinois isn’t much better. One of the other suitors for the Bears is the city of Aurora – Illinois’ 2nd largest city. However, Aurora’s effective commercial property tax rates are 2.81%, still well above national averages.

State and local reform is needed. Property tax levy freezes have been discussed for decades but have never materialized into state law. Multiple property tax task forces have been held, but citizens still aren’t directly empowered to do anything about it.

While there is a lack of resolve and agreement from state and local politicians to address Illinois’ high property tax crisis, there’s no shortage of potential policy solutions. In 2017, then-Gov. Rauner Rauner proposed a 4-year property tax freeze and legislators from both parties in the Illinois Senate passed a 2-year property freeze. However, the legislation never passed the Illinois House.

In 2022, Illinois residents got a one-time election year “property tax rebate” touted by Gov. Pritzker worth up to $300 off of state income taxes. However, the income tax reduction in the name of property tax relief expired and will not continue in 2023 or beyond.

This legislative session, Rep. Sosnowski has introduced the Taxpayer Empowerment Act – HB 1427 – which would allow residents to place binding referendums on the ballot to freeze or lower tax levies by up to 10%.

In some sense, the Chicago Bears are a canary in the Cook County and Illinois business climate coal mine. There is a temptation from state and local politicians to craft special laws to make it more likely the Bears find a hospitable business climate because of the high-profile nature of the NFL.

Between the Village of Arlington Heights and the State of Illinois, politicians have crafted 16 different taxpayer assistance proposals for the Bears’ Arlington Heights project, including a TIF District, a property assessment freeze, exemptions to state sales taxes, and diverting hotel, liquor, sports wagering back to a special “mega project” fund. However, none have been passed into law yet.

However, if the Bears receive any of these special tax reduction inducements, let’s not pretend this fixes any of the macro problems facing businesses in Cook County and Illinois. If a $5.8 billion valued Bears company needs massive subsidies to survive, then what about all other businesses currently struggling with other equal or higher tax burdens without the benefit of the NFL megaphone?

To prevent further economic decline and the potential loss of the Chicago Bears, the State of Illinois, Cook County and other local governments must take proactive steps to address its high commercial property taxes. Tax reform should focus on attracting and retaining businesses while ensuring a fair distribution of the tax burden.

Policymakers must act swiftly and decisively to foster an environment that supports business growth, job creation, and long-term prosperity. By doing so, Cook County can secure its economic future and ensure that beloved institutions like the Chicago Bears continue to call this region home.

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