Chicago is getting severe about their property taxes. Final 12 months, the Chicago Solar-Instances caught several families utilizing unlawful methods of reducing their property taxes. The day after the story was launched, the native assessors workplace demanded reimbursement and raised their property taxes to the common ranges. Now, Crains Chicago Business has found out that the identical assessor workplace goes after their native NFL group, the Chicago Bears, and the group shouldn’t be joyful about it.
A number of weeks in the past, the Bears publicly admitted to purchasing land in close by Arlington Heights to doubtless construct a brand new stadium. Nonetheless, it seems that a Chicago (technically Cook dinner County) assessor is now holding the Bears accountable for future property taxes on this land. The county assessor raised the property tax worth of this land by six occasions (applies to tax 12 months 2022 and past), and that doesn’t even embrace the development that shall be finished. For these non-tax followers, a land worth generally increases when buildings are constructed on it.
The Bears are appealing the move to the Cook dinner County Board of Evaluate. If the Bears don’t win their enchantment, they’re a further $15 million per 12 months in property tax funds. However the reasoning by the county assessor makes extra sense to me than what the Bears are proposing. The Bears purchased this property for $197.2 million in 2022. The assessor is claiming that the property’s tax worth is price $197 million. The Bears consider it’s price $33.5 million, however are keen to settle at $37 million. To not fear, although, because the Bears are telling the general public that they “want to pay our fair share”.
I gained’t get into a good market worth vs property tax price dialogue, as that may bore everybody studying this. However I’ll say that either side have factors. Let me shortly break them down:
- The Bears are appropriate in {that a} piece of land’s tax worth shouldn’t be the identical as its truthful market worth.
- The Bears are doubtless appropriate that because the land was vacant when purchased, it was producing nothing and due to this fact has a lesser tax worth.
- The assessor is appropriate that the Bears tax worth is a joke, particularly if you happen to think about how shut the acquisition date is from this evaluation.
- In keeping with an area board of assessment commissioner, the assessor checked out current gross sales of “comparable business property” and located the tax worth to be $150 million…that means the assessor’s worth must be appeared upon extra favorably.
- Assessors are given a whole lot of room, legally talking. If one assessor needs to worth a land’s buy worth greater than the quick money-producing worth, they’re allowed to do this.
Yesterday, the Chicago Tribune reported that the Bears have requested metropolis officers for permission to tear down a lot of buildings on their Arlington Heights property. Most assumed once they noticed the headline that the Bears simply needed to start out the stadium building early.
“The story by the Tribune suggests the demolition is merely occurring now … to decrease taxes on it for the Bears. It’s being finished, based on the story, to offset a tax elevate to round $16 million from about $3 million in 2021 when the monitor was working. The rise is the results of the next evaluation, however the Bears are hoping the demolition decreases the property worth.” — Sports Illustrated, 05/04/23
I’m going to offer the Bears the advantage of the doubt right here and assume this wasn’t the motive for the demolition request. The explanation for the assessors worth was because of the buy worth and the way shut that date was from as we speak. Tearing down the remaining buildings on the land doesn’t remedy that problem.
As I’ve written about prior to now, it’s very rare for any sports team to pay anyplace near what they’re alleged to for property taxes. A number of years in the past, the San Francisco Giants received so mad at the native assessors for his or her property tax payments in 2015-2016-2017, that they took them to an Appeals Board and had their property taxes lowered every year by near $180 million. To not be outdone by the native baseball group, the San Francisco 49ers have gotten their very own property tax invoice cut in half in previous years.
In 1996, Cincinnati county commissioners promised taxpayers that in return for passing a legislation permitting for a gross sales tax enhance to pay for 2 new stadiums, the commissioners “pledged to give property owners 30 percent of the money back in the form of a property tax rollback”. Since this pledge was not necessary, native commissioners have solely rolled again the total quantity two occasions since 1996. Why? As a result of the gross sales taxes from the brand new stadium and ballpark haven’t generated sufficient cash to pay down the debt on the 2 stadiums.
In 2013, the Atlanta Falcons let their metropolis/state fund between $700 million to $1 billion of their new stadium. One would suppose that their native leaders can be occupied with getting again some type of income from the tax cash given to this mission. One can be improper.
“Town (of Atlanta) has (an settlement) with the Georgia World Congress Heart that provides the (Falcons) $1.5B stadium a property tax abatement for 30 years … These taxes might add as much as $700M, or $26M a 12 months, in taxes utilizing the 2018 tax fee” – Biznow.com, 01/22/19
The checklist of different groups getting these breaks is quite a few. I discovered articles detailing how the Columbus Blue Jackets “owners sought and received a property tax abatement”. The Arizona Coyotes are asking voters to allow them to skip property tax funds on their billion greenback sports activities district for 30 years. The St. Louis FC group hadn’t even began enjoying within the metropolis, but they had been securing a number of tax abatements, together with a partial property tax abatement.
