Maria Pappas – The Menace of Privilege

Are Cook County property taxes actually paid? Some data from Maria Pappas

Georgists like to say that one of the many advantages of a real estate tax over other taxes is that, if the owner does not pay it, eventually s/he’ll lose the property, which can be sold to pay the arrears. But “eventually” is an important word here.

Now Cook County Treasurer Maria Pappas has compiled data showing the extent to which taxes don’t get paid. For this purpose, “not paid” means “not paid within a month of the due date.” I suspect that in most cases, these taxes are eventually paid, with a penalty (9% interest, recently reduced from 18%) included. But years might elapse, and various games can be payed by “investors” regarding these properties. (Some detail is on pages 23-26 of this pdf.)

The reports are broken out by property class, by ward, by municipal area, and by taxing agency, showing amount billed and amount paid, and can be downloaded to spreadsheets.

Countywide, 96% of all taxes billed were collected within a month of the deadline. In the impoverished Village of Ford Heights, only 28.55% of taxes got paid, but no other community had less than 50%. The six lowest percentages are all in the south suburbs, followed by the Chicago community areas of Englewood and West Garfield Park.

For parcels coded as “vacant,” only 71% of taxes were collected; all the other categories were above 95%. Total taxes billed to vacant parcels was $121,810,594, of which $86,873,652 was paid, implying that, were vacant parcels taxed at the same rate as commercial and industrial land, government revenue would increase by something like $130 million to $183 million — not counting the development which such a tax increase would encourage.

2020 Cook County Property Tax Analysis — sort of

We have a new report from Cook County Treasurer Maria Pappas, subtitled “2020 Cook County property tax analysis: A heavier burden for businesses, Black and Latino suburban property owners.” It’s got more detail than I recall seeing published before, including two decades of total real estate tax revenue countywide and by triad, and (for the past two years only) median taxes per parcel for residential and commercial, by municipality and township (and limited data for Chicago wards) as well as a fun list of the ten highest residential and commercial tax bills for each township. The extra load Cook County’s current classification system places on commercial property is noted.

All of this data for individual parcels has been available on the Treasurer’s web site for some time, but it wasn’t assembled for convenient use.

It’s likely impossible to discuss the real estate tax system (let alone the complete scope of public revenue) in a way which can hold the attention even of people who find themselves heavily burdened by the way government is funded and operated. And Pappas’ office got this information out quickly, as the taxes have only recently been calculated and won’t be due until October 1. All the same, there are problems which one hopes will be fixed next time this is done (and one certainly hopes there will be a next time, soon.)

Noting the continuing rise in revenues, the report asserts that “[t]he bigger tax burden is not being shared equally.” What could this mean? What would be equal? Should we fund government by a poll tax, which is the only way to get everyone to pay the same amount? Perhaps the writer means “equitably,” a desirable thing tho difficult to agree on. It’s then observed that “Property owners in many south suburbs continue to pay far more in taxes than landowners in other parts of the county.” I will set aside the fact that “property” and “land” aren’t the same thing, and assume that the writer may have meant “real estate taxes are higher in many south suburbs than in other parts of the county,” which is sufficiently cautious that it must be true.

But in fact the amount of real estate tax paid by a median homeowner is much lower, less than $4,000/year in Bloom and Thornton townships (page 49 of the statistics section of the report), less than any of the north suburban townships (page 56).

That doesn’t mean that the taxes in Bloom and Thornton aren’t a burden for many, because taxes imposed on struggling people are always a burden. And the very high tax rates reduce market values, while increasing the extra burden on renters (who cannot benefit from the “homeowner exemption.”)

The report makes no attempt to separate the value of land from the value of improvements, even tho the assessments provide this breakout for each parcel. There’s no distinction between owner-occupied and renter-occupied homes. The only mention of vacant land is to say that it’s been ignored, as has mixed-use (residential+commercial) property. There’s no mention at all of exempt government-owned land.

It would be helpful to include reference maps, especially of townships. And in an ideal world, the tables would be offered in spreadsheet format.

America’s Biggest Bank and America’s Biggest Crook and Cook County’s Treasurer

logo3 No, they aren’t all one and the same.

I personally haven’t had any problem with JP Morgan Chase. I had a CD with a predecessor bank and, when it matured, I retrieved it without difficulty. My real estate tax is paid thru them, and as far as I could tell my payments have been processed as intended. Once upon a time I may have had a credit card with them. But I long assumed JP Morgan Chase is a corrupt organization, because I seem to recall having read various things here and there, and, well, how could an honest bank become so large?

I hadn’t even thought about Morgan Chase’s role in the Madoff affair, but of course it was nontrivial, as documented by Helen Davis Chaitman and Lance Gothoffer on their JP Madoff website (and, one presumes, in their book). They have compiled the information, most of which was floating around the Internet, that “In the past four years alone, JPMorgan Chase has paid out $28,902,150,000 in fines and settlements for fraudulent and illegal practices.” And that, of course, is only the cases where they were caught and unable to avoid prosecution.

“Boycott JP Morgan Chase,” Chaitman and Gothoffer urge. Great idea, and I have done so as best I can. But I need to pay real estate tax, and as long as I live in Cook County it seems I must pay it to JP Morgan Chase. So I wrote Maria Pappas, the County Treasurer, saying

I see from the check with which I paid my most recent real estate tax bill that you are still using JP Morgan Chase to process the County’s receipts. It’s pretty clear that JP Morgan Chase is a criminal enterprise, having paid over $28.9 billion in fines and settlements for fraudulent and illegal practices during the past four years. Why is the County unable to use any less dishonest bank to process payments? Thanks in advance for your response.

And just a couple of [business] days later, I received a response from “Customer Service Department:”

Thank you for contacting the Office of Cook County Treasurer Maria Pappas.

Cook County aims to provide efficient payment processing to the greatest number of taxpayers at the least cost to those taxpayers. Nevertheless, we acknowledge that additional considerations are relevant in the County’s choice of vendors, and we take your concern under advisement.

We hope this information is helpful and thank you for the opportunity to be of assistance.

So, they didn’t exactly say “we are going to boycott JP Morgan Chase because they’re crooks,” but it at least it appears that somebody read and understood my message.

My other recent check processed by JP Morgan Chase was used to pay Illinois State income tax. I suppose I should write somebody (Governor? Treasurer? Comptroller?) with a similar message, but I just assume that anyone responsible for administering a tax on earned income is already beyond hope. Maybe someone else will do it.