Fritz Kaegi: Candidate Profile
Name: Fritz Kaegi
City: Oak Park
Office sought: Cook County Assessor
Family: Fritz and his wife Rebecca live in Oak Park with their three children, William (11), Rose (8), and Anna (6)
Occupation: Full time candidate for Cook County Assessor
Education: BA from Haverford College, MBA from Stanford University
Civic involvement: First United Methodist Church of Oak Park, Member, since 2010; Social Venture Partners Chicago, Investment Committee member, 2015-2017; Social Venture Partners Chicago, Partner, since 2014; Oak Park Youth Baseball and Softball, assistant coach, since 2014; CFA Society of Chicago, member and charterholder, since 2013; Leadership Greater Chicago, Finance Committee, 2015-2017, and Program Committee, 2013-2015 ; Leadership Greater Chicago Fellow, 2012-2013; First United Methodist Church of Evanston, member, 2009-2010; Broadway United Methodist Church, member, 2006-2009; Local admissions interviewer, Haverford College, 2003-current; Local admissions interviewer, Stanford Graduate School of Business, 2003-current; Chicago Council on Global Affairs, member, since 2003; Chicago Sister Cities, Moscow Committee, 2002-2014
Elected offices held: No previous political experience
Questions & Answers
Question 1: What skills, experiences and abilities do you possess that make you the best qualified candidate to run an assessor's office?
ANSWER: The job of the Assessor is to accurately and fairly estimate property value, and act as a good steward. The people of Cook County deserve an Assessor who will value all property in a fair, ethical, and transparent manner. This office needs to focus on accuracy in mass valuation, using the best data and models available. I have the ideal background for this. I worked at Columbia Wanger Asset Management for 13 years as investment analyst and portfolio manager. I valued thousands of companies around the world, including major investments in real estate, and acted as a steward over people's savings. Previously, I worked at Morningstar and helped build the company's equity valuation models. I hold the Chartered Financial Analyst (CFA) and Certified Illinois Assessment Officer (CIAO) designations.
I have gained an appreciation of housing and poverty issues, as well as of our regional nonprofits, as a partner and investment committee member at Social Venture Partners Chicago. SVP Chicago provides the financial backing and capacity-building resources of its partners to Chicago nonprofits fighting the cycle of poverty. In recent years, SVP Chicago partnered with Metropolitan Tenants Organization, Greater Englewood Community Development Corporation, Project SYNCERE, and One Million Degrees.
Everyday, working on this campaign, my team and I have heard from people whose lives and communities have been impacted by this broken system. We feel a great urgency to fix it. We know we can fix it. In getting this right, we lay a foundation to move forward with sensible tax policy in Illinois, and with our politics.
Numerous reports last year detailed inequities in the manner in which properties are being assessed, often to the detriment of lower-income families. What can the office do to address the problems and create a more equitable system of assessment?
At the core of this campaign is my belief that Cook County voters have every right to expect fairness, ethics, and transparency from the Assessor's office. Yet under the current status quo, the Assessor's office is organized to deliver favors to a small handful of winners, rather than a public service for the taxpayers.
After exhaustive reporting and research done by the Tribune, ProPublica, the Civic Consulting Alliance, and many others, we have a real understanding of the inequities and regressivity of our property tax system. This system has generated shocking over-assessments for working people, especially those living in areas impacted by the housing crisis and foreclosures -- particularly in communities of color. Ethical issues, a culture of pay-to-play, and a near total lack of transparency have exacerbated these inequities.
We know the damage that has been caused, but we can fix this system.
Real estate assessment is an exercise in taking lots of data about property characteristics and transactions, and then crunching that data to estimate, as accurately as possible, the market values of these properties. This is the job of the Assessor.
Today, we benefit from incredible access to data: Geographic information systems, 3D modeling, mortgage data, other third party sources. Data that used to be trapped at other government bodies like the Board of Review and the Recorder of Deeds, or in paper documents like building permits, can be captured and stored at ever lower costs. The technology, the data, and the best practices are all out there, and my team and I are completely focused on bringing all of these things to Cook County.
Question 2: Is there favoritism in the way the assessor's office does business today? If so, please explain how you would change that.
ANSWER: For many years, this office has cultivated a widespread perception that certain parties have an inside track to a favorable outcome. Favoritism, pay-to-play, and a lack of transparency have destroyed the public's trust in the Assessor's Office, and the work it produces.
We have a slate of new ethics rules that can be implemented on day one in office. This is essential, not only to mark a clear break from past practices, but also to begin to build trust in the new system.
As a candidate, I have already pledged not to accept donations from the property tax appeals industry, and as Assessor I will continue to do the very same.
We are looking at a variety of other ways to break the perception that certain parties have an inside edge, and to eliminate the culture of pay-to-play. Among these are: Creating a public visitor log;
Disclosure of employee contacts with parties engaged in appeals;
Anonymizing from analysts the identity of the law firms handling appeals;
Rotating analyst assignments of certain classes of properties;
Enhanced codes of conduct and limits on gifts and entertaining;
Enhanced disclosure of conflicts of interest and outside sources of income.
Question 3: Do you think there are too many, not enough or just enough incentives that lower property taxes for commercial property owners in Cook County? Please explain your answer.
ANSWER: The job of the Assessor's Office is to faithfully administer the incentive programs decided upon by the Cook County Board. The current incentives are simply tools in the toolbox for municipalities to attract commercial projects and investment. I believe the current incentives are sufficient, and we must be cognizant that the process for administering the incentives is not overly burdensome on the Assessor's office, or the person applying.
Question 4: What should the assessor's office be doing to make information, data and decisions about assessments more transparent?
Taxpayers deserve to know how their assessments were calculated. We are committing ourselves to telling property owners how their assessments are calculated. No more closed door, back room adjustments. This should be the minimum standard for this office. This is a requirement for building trust in the integrity of the system.
We will go further by making data and algorithms (including assessment variables) available to outside parties so that people can check our work. By opening up the data in this way, we can root out the biases and unsound valuation practices and favoritism that we know have existed--and restore confidence in the office. Transparency will be an excellent tonic.
Question 5: What other issues, if any, are important to you as a candidate for this office?
ANSWER: Making the Assessor's Office ethical, transparent, and fair is an essential step for making our whole system of local government finance fairer and smarter. Our plan will greatly reduce the regressivity of our property tax assessment system, but at the end of the day, property taxes are a regressive way for government to finance itself. It is inherently inequitable for local property prices to determine spending on education and other public goods.
About 60% of Cook County property taxes go to our public schools, and that is largely because Illinois ranks last in the United States for state funding of local schools. Other states share more revenue with local schools because they have higher, more graduated income taxes to share.
We intend to push for the graduated income tax as part of our effort to reduce the burden of property taxes everywhere, but especially in communities impacted by the housing crisis where effective tax rates are disastrously high. The same communities that have been damaged by years of over-assessment. The Assessor does not have power to legislate change on these issues, but we can forcefully testify to the need for that change.