The news: With the passage of Senate Bill 101, Illinois lawmakers extended the Alternative General Homestead Extension–”known as the “7 percent property tax cap.”
Behind the news: In its original form, the bill extended the property tax cap initiated in 2003 to control skyrocketing property tax growth for those rapidly inflating in value. But Illinois House members revised the bill by including provisions that will phase out the tax cap in the city of Chicago by 2009, in north suburban Cook County by 2010, and in south suburban Cook County by 2011.
Supporters of the House revisions believe that the cap won’t be necessary as the housing market stabilizes. “We believe that the legislation passed by the House is an appropriately structured phase-out of the legislation as the inflation that’s occurring in the residential market [subsides],” said Tom Johnson of the Taxpayers’ Federation of Illinois.
Still, some black and Latino communities might witness the highest increases in property taxes when the tax cap sunsets. According to a Civic Federation study published in March, if the tax cap was not renewed, homeowners in Chicago’s Englewood neighborhood would have seen a median property tax increase of 162 percent in 2006, the highest of 12 Chicago neighborhoods analyzed. Humboldt Park homeowners would have seen a 90 percent increase. South suburban Harvey would witness a median increase of nearly 46 percent in 2008, the highest of 12 suburban towns analyzed.