Chicago’s priciest homes undertaxed by $800M over 5 years: new report

The most valuable homes in Chicago were undertaxed by an estimated $800 million over a five-year period, with the bottom 70 percent of houses picking up the burden, according to a new report from the University of Chicago’s Center for Municipal Finance.

The report is the first to put a dollar amount on a problem at the Cook County Assessor’s office — the most expensive houses tend to be taxed at a lower rate than more modest homes, resulting in what critics call an unfair, regressive tax on those homeowners least able to afford it.

The report couldn’t come at a worse time for embattled Cook County Assessor Joe Berrios, who is running for re-election and faced a barrage of criticism for the way his office assesses home values.

The center’s study, which was put out Thursday, follows the release of the county’s independent study on the assessment system.

That report, which was conducted by the Civic Consulting Alliance, found the property tax assessment system to be regressive, but could not provide a dollar amount on the wealth transfer.

The center’s study is the first to put a dollar amount on how much money was shifted from low-income homeowners to homeowners of higher incomes and pricier houses. The aggregate shift was roughly $2.2 billion over the five-year period studied, according to the report.

Christopher Berry, a professor with the center who did the analysis for the study, said the results were “staggering” and though Cook County Assessor Joe Berrios said he inherited a 40-year-old problem, that’s “not a great defense.”

“He’s been assessor for two terms, and involved with the assessment system for a majority of those 40 years and the system hasn’t been fixed,” Berry said. “He had seven and a half years to fix this, but before he said the problems were 40 years old he denied they existed.”

Berry does note some limitations in his study. The report, for instance, using data from the assessor’s office, only looks at homes within Chicago.

A spokesman for Berrios criticized Berry for not releasing the report to them first before the public and giving the office a chance to review it.

“Cook County Assessor Berrios is committed to working with the Civic Consulting Alliance and Tyler Technologies to continue to improve the 40-year-old system he inherited,” a statement from the assessor’s office read in part. “We are saddened by Professor Berry’s lack of professionalism in releasing this report four days before the election and not giving us the opportunity to review it.”

Fritz Kaegi, who is running to unseat Berrios, said in a statement that shifting billions in property taxes from wealthy property owners is “taking money out of the pockets of working families and devastating communities.”

“This study vividly provides new detail on exactly how unfair and regressive Joe Berrios’ assessment system has become,” Kaegi’s statement said. “Neighborhoods lose people because of this theft, and it is neighborhoods on the South and West Sides of Cook County that are hit the hardest.”