How big a hit will homeowners and commercial property owners take if Mayor Rahm Emanuel’s pension reform proposal goes through? The mayor has proposed $50 million increases each year for the next five years, totaling $750 in new property tax revenue over that span.
City figures show that a homeowner would pay $50 more per year on a residential property worth $250,000. The owner of a million dollar home would pay around $200 more in the first year. By the fifth year, that homeowner would pay $1,000 more than today to satisfy the city’s portion of the property tax.
Figures from the Cook County Clerk’s office, but not verified by the city, show a higher burden on commercial property owners, i.e. anyone with a business or industrial facility.
The owner of commercial property assessed at $250,000 would pay $135 in property taxes. The owner of commercial property of $1,000,000 would pay $540. Using the same calculator, the owner of property worth $10,000,000 would pay $5,400 more per year above current levels.
Keep in mind that only about a quarter of your property tax bill goes to the City of Chicago. The majority of the bill goes to the Chicago Public Schools, who have raised their levy every year, and would likely do again in future years.
The mayor’s pension reform proposal does not take into account the dramatically underfunded police or fire pensions, which make up half of the city’s pension funds. He has not ruled out additional property tax hikes to help stabilize those systems. He says that failing to enact any reform will lead to a $600 million payment into those funds. That, he says, would cause the undesirable situation where property taxes double AND city services get slashed.
~Graphic created by Kristen Thometz