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McHenry County taxpayer appeals on the decline

State multiplier could cause increase in county assessments

Published: Saturday, Nov. 16, 2013 12:04 a.m. CDT

WOODSTOCK – For the first time in almost a decade, the number of property owners appealing their assessments has taken a dip.

But it has yet to be seen whether the state will slap another countywide multiplier on next year’s bills.

About 7,000 property owners have appealed their 2013 assessments from which next year’s property-tax bills will be calculated. The total is down from the record 10,413 appeals filed last year for 2013’s bills that taxpayers just paid, Supervisor of Assessments Robert Ross said.

Thursday was the last day to file an assessment appeal for property owners in Burton Township, the last of the county’s 17 townships to publish. Owners have 30 days to appeal from the publication of their townships’ assessments.

The main factor Ross attributes to the dip is that assessments have lowered enough so as not to result in significant tax bill hikes. Part of the reason for the skyrocketing number of appeals in the wake of the bursting of the housing bubble was that many owners’ bills were increasing despite plummeting home values.

“I think the major reason is that the three years of assessment loss have more or less caught up with the market,” Ross said.

However, county taxpayers again could be hit with a state multiplier – increasing everyone’s assessment by a set percentage regardless of what they did or didn’t do with their property – if the appeals that were filed lower the county’s total assessed value by 1.5 percent or more.

The Illinois Department of Revenue in 2011 raised every McHenry County property’s assessment by 3.48 percent to compensate for lost value. It was the first time since 1983 that the department imposed one for McHenry County. The number of appeals and decreased county assessment value resulted in a 1.7 percent state multiplier on 2012 property-tax bills and a 2.43 percent multiplier on this year’s bills.

The number of assessment appeals fielded by Ross’ office stayed fairly consistent – between 600 and 875 – from the mid-1990s until the housing market tumbled and the Great Recession followed. The office received 1,173 appeals for the 2007 tax year, which doubled the next year and almost doubled again the year after that. The number has steadily increased up to the 10,413 appeals filed last year for the current tax year.

The ironic culprit for tax bills rising while property values fall is the tax cap law enacted to protect suburban taxpayers from out-of-control property tax increases.

State lawmakers imposed the tax cap, or the Property Tax Extension Limitation Law, on McHenry and other collar counties in 1991 to rein in double-digit annual tax increases. The law limits the increase that taxing bodies can receive over the previous year to either 5 percent or the rate of inflation, whichever is less. Governments that wanted more had to ask voters via referendum.

The rate of inflation for property-tax bills due next year is 1.7 percent, according to the department of revenue.

But the tax cap has an unforeseen consequence when home values decline. In a declining market – a scenario that state legislators never considered – the tax cap ensures governments receive that inflationary rate of increase if they choose to capture it.

As a result, many local governments have made sure each year to capture that inflationary increase. But some governments in recent years, such as the McHenry County Board, have recognized homeowners’ plights and opted not to collect that increase.

Township assessors this year finished publishing their assessments months earlier than in previous years because of the large number of appeals. Last year, the two most populous townships, Algonquin and Grafton, did not publish until October and mid-November, respectively. Those two townships make up almost half of the appeals that Ross’ office has to process in any given year, which resulted in a last-minute deluge for the Board of Review.

When every last appeal is settled and every county parcel’s value is finalized, the county clerk will send that data to the department of revenue. Ross said the county should find out by April whether the department will impose a countywide multiplier.

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