Because of a heavy debt load and a state law requiring Chicago to dramatically increase its contributions to its public school pension fund, the City of Chicago recently passed a $245 million property tax increase for the 2016 (payable 2017) tax year. This is in addition to the previously passed $588 million property tax increase for fire and police pensions that is being phased-in from 2015 (payable 2016) through 2018 (payable 2019). The overall tax increase for 2016 (payable 2017) will be $354 million when including both the public school ($245 million) and fire and police ($109 million) tax increases.
Given the above and based on our research, we are estimating that the 2016 (payable 2017) tax rate in the City of Chicago will increase approximately 7.5%. This is much greater than the annual 1–3% tax rate increases typically seen in Chicago. The actual 2016 (payable 2017) tax rate will be known when the second installment tax bills are issued in July 2017.
Please note, these property tax increases and tax rate assumptions only affect and apply to properties located in the City of Chicago. Please feel free to contact Shawn King or Mike Abbatemarco with any questions you may have.
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