Why you could wait 2 years for tax appeal board answer
Property owners who aren't satisfied with their tax assessments after appealing through local channels can always take it a step higher to the Illinois Property Tax Appeal Board.
However, they shouldn't hold their breath waiting for a response.
The state agency that many refer to as the Supreme Court of property tax appeals is so overwhelmed, officials there acknowledge it takes about two years -- even longer in some cases -- for a decision from the board.
"They basically told me they're swamped with paperwork," said Round Lake Beach homeowner Derek Monroe. "I'm surprised they don't explain the workloads to people who are applying. This is really unacceptable."
Monroe is seeking an assessment reduction of about $20,000. But he can't even find out if the appeal documents he submitted in May were received. On its website, the agency notes online appeal status updates are available only for appeals submitted before Feb. 15. Workers at the agency's Des Plaines office said it could be three more months before Monroe's appeal status is available online.
And it may not be worth the wait. Statistically, the agency reports about one-third of the decisions reached each year result in a change to a property's assessment -- although favorable decisions do enable property owners to challenge subsequent assessments using the PTAB ruling.
Despite increased funding, agency records don't show an increase in decisions from the well-compensated board. Agency officials say they are understaffed to handle the increase in appeals, which continue to grow each year.
"We're deluged," lamented Don Crist, chairman of the governor-appointed five-member board. "It's like shoveling snow in a blizzard."
Crist is paid $64,703 a year to head the board, whose other four members each make $52,179 annually, according to state finance records. Crist said the position requires a lot of work, but he admitted it was not a full-time job.
The board meets just once a month. And according to minutes available on its website, the average length of a meeting is 84 minutes.
Critics contend the board could do more at the agency for the salaries and benefits its members receive. In order to be appointed, board members need some background in the property tax process. Crist used to be Vermilion County's supervisor of assessments, for instance. He resigned from that post to take the board position, which he said pays about $10,000 more a year than his former elected office.
"You'd figure if they had such a great amount of work, they'd do much more than meet once a month for a couple hours," Monroe said.
The members are appointed to six-year terms and eligible for state pensions. Currently, Crist, of Danville, and fellow board members Mickey Goral, of Rockford; Kevin L. Freeman, of Chicago; and Mauro Glorioso, of Westchester, participate in the State Employees Retirement System, officials from the retirement program said. The newest member, Jim Bilotta, of Lockport, does not currently but can join.
Crist, Goral and Bilotta, who are either current or former elected officials, also participate in the Illinois Municipal Retirement Fund. Both Crist and Bilotta are vested in that retirement system's lucrative Elected County Official pension program, allowing members to receive 80 percent of their average final salaries after 20 years in office.
While elected officials in the special program contribute at a higher rate -- 7.5 percent instead of 4.5 percent -- the traditional IMRF program requires 40 years of work to maximize retirement benefits that amount to 75 percent of a worker's final average salary.
PTAB Executive Director Louis Apostol defended the board members' pay and benefits, noting the board is expected to review an average of 1,500 decisions, settlements and recommendations from the staff each month.
Crist also noted the board can work only as fast as the staff handles cases. And since budget cuts nearly a decade ago slashed personnel levels essentially in half, the agency staff can't keep up with a workload that has increased as a result of the downturn in the real estate market.
"We're not right-sized," he said. "The legislature is beginning to understand that PTAB is in a precarious situation."
In 2003, the agency handled a little more than 38,000 appeals statewide. Today, there are almost 40,000 open appeals in Cook County alone. At the end of the 2011 fiscal year, the agency had almost 90,000 unresolved cases statewide, according to its records. Cook County's spike is also attributable to changes made to assessment procedures in 2009 that artificially inflated home values, despite the nationwide decline in property values.
Also, it may not be as simple as throwing money at the problem. Budget documents indicate it's costing more to run the agency each year and roughly the same amount of work is being done.
In 2008, the agency's budget was about $2.3 million and the board cleared 25,302 appeals. For the fiscal year that just ended in June, the agency's anticipated expenses were expected to total $4.3 million with 24,300 appeals cleared during the 12-month time frame. The agency staffed 22 employees in the 2008 fiscal year and 23 last year.
Apostol said much of the increase is due to labor costs rising. All but two positions in the agency are part of a union, he said.
In 2011, state financial records show the agency's expenses totaled nearly $3 million, with nearly two-thirds going toward salaries alone. That doesn't include salaries paid to board members, which come from a different fund.
While residential property tax appeals fill up the majority of the board's docket, it's the complicated commercial property tax appeals, which come with a heftier price tag, that take up much of the agency's time. That's because anytime a property owner is seeking tax relief of more than $100,000, the taxing bodies affected by such a reduction are notified as well and are allowed to fight such appeals as "interveners."
In fact, if local assessors and boards of review allow such significant reductions, taxing bodies like schools, towns and park districts can file their own appeal with the state agency, though that's fairly rare, agency officials said.
Carol Stream Elementary District 93 filed an appeal in 2008 against a developer who received a significant tax break that is still unresolved. In all, the district is involved in 20 appeals being heard by the state agency, officials there said. The oldest of the appeals dates to 2005, said David Hill, the district's assistant superintendent for business.
"We want to make sure all taxpayers are paying their fair share," he said.
At local levels of property tax appeals, when a property owner is given a reduction, taxing bodies don't lose any money because other property owners cover the slack. However, that's not the case if a property owner is granted a reduction by the state agency.
"Because the tax bills are issued, we'd lose those direct dollars," said Ric King, assistant superintendent for business at Schaumburg Elementary District 54. "We have to pay that money back. It's not like we can recapture that money."
King estimates the district has about 1 percent to 2 percent of its property taxes tied up in PTAB cases on any given year. The district collected nearly $160 million in property taxes this year. The district is part of a consortium of taxing bodies in the area that split the cost of fighting six-figure property tax appeals.
According to District 54 financial records between 1998 and 2009, the district has prevented almost $11.6 million in lost property tax revenue by fighting appeals at the state level. Actual losses amounted to nearly $4.5 million during the same time period, and another $13.8 million is at stake in 168 unresolved cases.
District 54 has spent almost $600,000 for its share of legal fees related to PTAB disputes from 1998 through 2012, records show.
Another $244,000 was spent by the district to cover appraisal costs used in assessment fights. The district has at least one unresolved case dating back to 2000, King said.
While Crist said only a "very small fraction" of the agency's cases date back that far, the board is not shy about granting deadline extensions.
Apostol said the extensions are necessary to give all sides a fair chance to make their cases and give the board the best information on which to base its decision.
That's important, he said, because the board's decisions are all subject to judicial review. When challenged in court, Apostol said, the board's decisions are upheld roughly 95 percent of the time.
The agency fought legislation aimed at speeding up the process. Yorkville Republican state Rep. Kay Hatcher proposed a bill requiring a decision from PTAB within a year. Less than a month after it was introduced, the bill had been assigned to the House Rules Committee where it essentially languished and died. She said she plans to reintroduce the legislation next year if she's re-elected.
Hatcher had filed the bill after hearing North Aurora constituent Rich Tolleson's plight with the process. Tolleson filed an appeal seeking an assessment reduction of nearly $80,000 in early 2009 and didn't receive a decision from the board until late 2011, he said. Tolleson said agency officials complained about their workload when he inquired why the process took so long.
"I run my own company, and if I ever said to one of my customers that the reason I couldn't do the job they were paying me for on time was because I had too many customers, they'd put me out of business," he said.
"But these bureaucrats don't care."