Clash emerges over how to assess Cook Co. market values

The Cook County Board of Review charged Monday that Assessor James Houlihan was shifting the tax burden to homeowners with the new, streamlined "10-25" system tying assessed property values to market values.

Yet the system, which takes a complex number of different assessment codes and replaces them with two - with assessment set at 10 percent of market value for homeowners and 25 percent for businesses - was approved by the Cook County Board two years ago to go into effect this year.

"You can't tinker with an assessment system," said Board of Review Commissioner Larry Rogers Jr. of Chicago in a news conference Monday in Chicago. He said the simplified 10-25 system was causing "a drastic shift in the tax burden" from businesses to homeowners.

Houlihan's office lashed back with a statement saying: "The Board of Review is manufacturing an excuse to slash 2009 assessments for the big commercial landlords. But by doing that they'll put more and more of the tax burden on homeowners. This shift of the tax burden won't happen unless the board allows it to. They're claiming they have to do what the property-tax lawyers want them to. But they have a choice; if they don't issue massive reductions for commercial property at homeowners' expense, the tax burden won't be shifted."

Basically, the new 10-25 system was intended to bring market values - traditionally undervalued in Cook County assessments - closer to reality. So even as the assessor's office points out that every residential property in the county received a lowered assessed value this year, that has resulted in higher stated market values. The Board of Review, however, which rules on contested assessments, has shown its readiness to accept arguments on appeal that a market value can't have risen in the current real-estate market.

"We will follow the law, but what we're seeing is record numbers of appeals from the aggrieved homeowners and taxpayers," Rogers said. "Aggrieved business owners are filing appeals like never before."

Board of Review Commissioner Joseph Berrios, who was in Springfield lobbying for relief on the system he called "the Claypool 10/25 Ordinance" because it was sponsored by Cook County Commissioner Forrest Claypool, said it "is going to raise homeowners' taxes unless something is done to correct it."

Claypool is running against Berrios as an independent to replace the retiring Houlihan as assessor.

Also involved is a battle over when tax bills will go out. The assessor's office said it finished its duties last week - a week ahead of its self-imposed deadline - and challenged the Board of Review to complete its duties in the usual 21/2 to three months.

Citing the number of appeals, Rogers said he couldn't commit to having the bills ready before November.

Houlihan has charged the board - led by Berrios, head of the Cook County Democratic Party - was dragging its feet to delay bills until after the election.

Republican county board presidential candidate Roger Keats of Wilmette, who attended the Board of Review news conference, dismissed it out of hand. He called the entire Cook County assessment system "a Ponzi scheme that would make Bernie Madoff proud," adding, "The symptom is property-tax assessment. The problem is government spending."

He said all government bodies have to cut spending in order to give taxpayers relief and called on Cook County to adopt the same assessment system as the rest of Illinois - at a uniform one-third of market value - thus eliminating the need for the state multiplier used in Cook County.

He called the Cook County system "a silly formula that doesn't work, doesn't function and completely makes people feel their assessment isn't what it is."

Keats has been critical of the way law firms owned by House Speaker Michael Madigan and Senate President John Cullerton typically argue tax appeals before Berrios. He called that a conflict of interest and said, "We have based a mini-industry on screwing the taxpayer."

Comparing Houlihan with the Board of Review, Keats said, "They're both wrong, but Houlihan is less wrong," adding, "At least his process is much more open than it used to be."

Rogers said the board backs Gov. Pat Quinn's call for property-tax relief in Cook County, but pulled up short of endorsing a renewal of the so-called 7 percent homeowners exemption, a proposal backed by Houlihan to limit increases but stymied in the General Assembly by Madigan.