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Tax cap reform advances again

Bill would forbid increases when values decrease

Published: Saturday, March 23, 2013 5:30 a.m. CDT

An effort to limit local government’s power to tax when property values decline again is heading for a vote in the Illinois House.

House Bill 89, filed by state Rep. Jack Franks, forbids governments under the tax cap from collecting an automatic increase if their overall assessed value declines, except by voter referendum. It passed the House Revenue and Finance Committee on a 10-0 vote Thursday.

Franks, D-Marengo, tried to get the bill passed in the previous session of the General Assembly. It cleared the House on the second try but stalled in the Senate, and was heavily resisted by local government lobbying groups.

“Government needs to be a reflection of its citizens, and when citizens have less, governments should have less. Many governments need to learn that, and some have,” Franks said.

Franks pointed out that since his efforts to enact the law started more than a year and a half ago, a number of local governments have voluntarily kept their levies flat and rejected the automatic increase they are entitled to under the cap.

The tax cap, or the Property Tax Extension Limitation Law, limits the annual increase that taxing bodies can receive to either the rate of inflation or 5 percent, whichever is less. State lawmakers imposed the cap on the collar counties in 1991 to rein in double-digit property-tax increases as home values started to soar.

But when home values decrease – a scenario lawmakers never considered – the tax cap works in government’s favor and against taxpayers by guaranteeing that taxing bodies can collect the inflationary increase.

Franks first filed the bill in June 2011, citing taxpayer outrage shortly after the first installment of property taxes was due. Local governments were able to collect 2.7 percent more on the bills due that year.

Taxing bodies that did not voluntarily hold their levies flat will be able to collect 3 percent more on this year’s tax bills.

The McHenry County Assessor’s Office fielded more than 10,000 assessment appeals for property-tax bills due this year. The number of appeals has broken successive records since the bursting of the housing bubble.

On the Net

You can read House Bill 89 on the General Assembly website at

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