In an eye-opening revelation, Cook County homeowners might be saving less than they think due to tax exemption policies, says a report from Cook County leaders. The report found that while homestead exemptions, which intend to lower taxes for certain homeowners, take out a whopping $1.6 billion in yearly tax revenue countywide, they sometimes lead to increased tax rates that could deter potential buyers and businesses from coming into a community.
Despite these exemptions, homeowners in Cook County's north and northwest suburbs have been struck with the largest property tax increase in 30 years, according to a separate study from the Treasurer’s office. The residential property tax bill jumped by 15.7% this year, shifting the tax burden more heavily onto homeowners, rather than commercial properties. The increase has been attributed to rising assessed property values and a real estate market that's too hot to handle.
Meanwhile, some communities, like Park Forest and Phoenix, have watched homestead exemptions hike up their property tax rates by double digits. The report initiated by the county’s Property Tax Reform Group indicates that the exemptions can unintentionally inflate the fiscal pressures on all residents, including those they are designed to aid, as governments scramble to cover costs. In a troubling twist, the suburbs that are struggling the most are reportedly the ones where exemptions are triggering the sharpest rate rises, pushing tax rates in Park Forest to a staggering 41.36% in 2021, with Phoenix not far behind.
As for the windfall homeowners saw in their tax bills, the gains may be more mirage than bounty in certain areas. For example, in Dolton, a homeowner might think they’re saving $2,792 due to general homestead exemptions, when the true benefit, once accounting for the higher rate caused by everyone's exemptions, is a mere $311, per the group's analysis. This mismatch between perceived and actual savings underscores a disconnect that residents and policymakers alike are struggling to reconcile.
“We’ve got to do our work of trying to educate folks about this,” Cook County Board President Toni Preckwinkle told the Chicago Tribune. She emphasized the need for assessment before implementation, to avoid the “unanticipated consequences” that often come with well-meaning legislation.
