Image of 3710 N. Kenmore from Cook County Assessor

Gary Lucido writes of a small parcel at 3710 N. Kenmore, offered at $9.9 million ($4950/sq ft) after failing to sell when offered at lower prices. While the price seems outrageous, the property is very close to Wrigley Field and could be used for a billboard or rooftop viewing platform. We know that the former use has commanded $350,000/year on a nearby building, which seems to justify a multi-million-dollar asking price.

So we have a parcel worth, let us say, five million dollars.  What are the taxes? Using data from the Illinois Department of Revenue, our friends at the Civic Federation publish estimates of the effective tax rate for various kinds and locations of property.  For residential parcels in Chicago, they estimate that the real estate taxes at 1.45% of actual market value. So on that basis, a parcel worth $5 million would pay $72,500/year.

But the Assessor doesn’t think this parcel is worth $5 million.  His estimate is $569,580.  (That is, the assessed value, which is supposed to be 10% of market value. is $56,958.)

Looks to me like this parcel is underassessed by something like 90%.  Even if we pretend it’s worth just $569,580, tax at 1.45% should be $8259/year.  Which is  $64,241/year less than the  “fair share” I estimate above.

So how much does the property actually pay? The Realtor’s listing says $147.  Surely this is a typo, no residential property in Chicago can pay so little?  Actually, the County Treasurer confirms it (I can’t seem to link to the actual record, but go here and search for parcel 14-20-218-047-0000).  This parcel receives three different kinds of exemptions: Homeowners, Senior Citizen, and Senior Freeze.  Apparently the net result is a tax bill of $147/year, on a multi-million dollar property which would “normally” pay about $72,500/year toward the costs of running the schools, parks, and various city services. Need we wonder why our local governments are in financial difficulty?

There are several additional points to be raised here.  First, assessment geeks may note that I have conflated data from several different years.  Of course that’s true, because taxes are always based on the value as of the start of the prior calendar year, and calculation assessment/sales ratios cause further delays. I also have not mentioned the multiplier, a factor which might help explain the details of this case but does not alter the basic fact that the property is severely underassessed.  Nor have I mentioned the owner of the property, beneficiary of this governmental failure.  The name of the apparent owner is on the Treasurer’s record, and he seems to have a Facebook page.

Finally, let’s give credit where credit is due.  Not only to Gary Lucido who might not realize the significance of the story he broke, but importantly to the open information policies of the Cook County Assessor and Treasurer.  Pretty much all assessment and real estate tax data is public record.  The income tax involves far worse outrages, but we rarely can see them since individual cases are confidential, and specifics have to be inferred from other sources (as for instance in this case.)

Postscript, a few hours later:

I was thinking about how the Assessor could come up with such a low value for this property.  Basically, what’s a very small residence on a tiny lot worth in the Wrigleyville neighborhood?  Very possibly the answer is $569,580. This particular parcel is worth many times that because of its precise location, but the Assessor does not consider that.  And if I owned the property, I would appeal any higher assessment.  Evidently the assessment rules need to be changed, so that the potential use of the property is considered. One does wonder how many dollars stay in speculators’ pockets because of this failure.

So, while waiting for Mint 11 KDE, which one hopes will solve the problem, I’ve been using the Opera browser instead of Firefox.  Opera is very smooth, works very well except when it doesn’t.  And doesn’t is how it handles blanks in the WordPress visual editor.  Whichwouldresultinallthewordsrunningtogether.  So, for blogging, I switch back to Firefox.  All the while worrying whether I’ll get another freeze. What’s really discouraging is that neither the WordPress forum nor the Opera forum have offered any assistance.

via Naked Capitalism

Buried deep in the text is the note that Marathon has its own “proprietary microbe” to produce ethanol from wood chips. Whereas, one hopes, that a successful NASA project would produce technology available to all.

I suppose Bolden wanted, not to kill the project, but only to slow it until Marathon’s attorneys can figure a way to monopolize the “intellectual” “property” which it produces.  Am I cynical?

btw, I think Tribune Company still owns the Orlando Sentinel, where this article was produced, but there is, so far, no sign of it in on Chicagotribune.com.

Now, we have debt trolls.  These are (per second page of this article) “well-funded, aggressive and centralized collection firms, in many cases run by attorneys, that buy up unpaid debt and use the courts to collect.”  The reason it’s news is that, in Minnesota and some other states, taxpayer-funded police, jails, and courts are used to arrest the alleged debtor and collect the debt. It’s not exactly debtor’s prison, but it is going to jail because you’ve failed to pay what you (presumably) owe.

via Naked Capitalism.

…you agree to grant Us a non transferable option to claim, for now and for ever more, your immortal soul. Should We wish to exercise this option, you agree to surrender your immortal soul, and any claim you may have on it, within 5 (five) working days of receiving written notification…we reserve the right to serve such notice in 6 (six) foot high letters of fire, however we can accept no liability for any loss or damage caused by such an act.

Purchasers were offered an opt-out checkbox, but apparently only 12% checked it.

Of course nobody reads the terms and conditions.  (Actually, I have met one person who claims to; I didn’t ask him whether he had actually purchased anything on-line.)  On more than one occasion I’ve found the link to terms and conditions didn’t work, or made no sense, have notified the vendor and usually received an updated link or a correction.

Thanks to Windypundit for this tip.

One of my favorite points regarding health care is made:

NICHOLAS CHRISTAKIS: But the vast majority of improvements in health in our society over the last century have had very little to do with medical innovation. What really counts is other kinds of things we can do, and those other kinds of things tend to be non-medical things. Like, thinking about the distribution of wealth in our society, or providing public health infrastructure, or better education for people, better housing – all of those things which aren’t medical phenomena. It’s all those that are really material for public health.

Social Security reportedly provides a higher monthly payment, relative to the amount put in, for lower income workers.  But because low income people have shorter lifespans, this doesn’t mean that it redistributes income downward.

And any post about income inequality, including this one, should include a disclaimer such as the following:

Any system of taxes and subsidies intended to equalize incomes will do so inefficiently if at all, and is likely to be perverted. An effective solution to the problems of poverty requires the elimination of privilege and the preservation of opportunity for people to earn a good living.

Originally broadcast last year, this seems to be a four hour program, and I’ve only read part of the transcript for the first hour. Thanks to Bob Matter for pointing it out.

This information comes from farmlandgrab.org (“Governments and corporations are buying up farmland in other countries to grow their own food – or simply to make money”), via Alanna Hartzok.