A new audit warns that a monumental and costly task is in store to reform the county’s troubled property tax system. The report released Thursday offers few specific price tags for fixing problems first identified by the Chicago Tribune and ProPublica Illinois, but does suggest overhauls that could cost millions of additional dollars.
That may present yet another challenge to county board President Toni Preckwinkle as she crafts a new budget and works through a projected $49 million deficit. Still, the sheer size of assessor Fritz Kaegi’s jurisdiction and extent of the problems embedded in his system led auditors to call for a long-term commitment of resources.
“The task ahead is monumental, and the financial and resource commitment for modernization is substantial,” said the report from International Association of Assessing Officers consultants.
Kaegi’s office requested the audit, but said it didn’t have a cost estimate for the report’s implications. Preckwinkle said officials’ budget requests often seek more money than the county has. That means delicate negotiations could be in store over an operation once led by a close ally of the board president.
“Government at every level at this time is resource-challenged,” Preckwinkle told reporters after the county board’s Thursday meeting.
“We’re looking at a $49 million budget gap. However, it’s always a challenge to close the gap and we will do our best to meet the needs of all of our bureaus and departments — and separately, elected officials — within this constrained climate,” she said.
A Tribune investigation found the assessor's office under Joseph Berrios tended to overestimate the value of single-family homes in poor or working-class neighborhoods while underestimating the value of homes in wealthier areas.
Those problems put a disproportionate share of the county's property tax burden on less affluent homeowners, whose tax bills often were inflated while others got an undeserved break. Reporters also found defects in the assessment system for commercial properties, which shifted the tax burden unfairly onto smaller business owners, as well as homeowners.
The latest audit underscored those problems, as well as reviews from the Civic Consulting Alliance and Tyler Technologies — a county contractor charged with updating the assessor’s technology.
Auditors concluded the assessor would need to hire, train and equip 90 new data collectors for its residential valuations department — plus supervisors and clerical workers. That step alone would require “a very significant increase in the budget” plus time to get those employees up to speed.
Kaegi’s office could hire a company to handle property reappraisals, at an estimated cost of $88 million, though auditors did not recommend that approach.
While contractors are on the clock to replace the assessor’s AS400 computer system toward the end of this year, auditors said the switch requires a clear plan and more staff to implement the new technology.
What’s more, the assessor’s office needs to update the data it uses in appraisal projects. Data used today has been so poorly collected and maintained that it raises questions about the accuracy of ensuing property values, auditors said.
The office also needs to develop new methods of assessing real estate value, and write guidelines for its initial valuation procedures and appeals process.
“The IAAO has laid out in very clear terms that we have a significant task ahead of us in reforming this office,” said Scott Smith, a spokesman for Kaegi’s office.
“We’ve started those changes, but obviously completing them is going to be a yearslong process. Implementing their suggestions is something we’ll be working on with our partners in the county, and that includes coming up with costs.”
Preckwinkle said it’s still too early to predict how much money will be needed.
“My general experience has been that every bureau and every elected official asks for more money than we have. So, it’s always a matter of negotiation and trying to set priorities.”
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