SPRINGFIELD – The Illinois Senate on Tuesday narrowly voted to send Gov. Rod Blagojevich a bill designed to spare Cook County residents from steep increases in their property tax bills while providing larger homestead exemptions to property owners statewide.
"Every property tax payer in this state will see some relief," said state Sen. Terry Link, D-Vernon Hills.
Cook County Assessor Jim Houlihan said the measure was needed to help longtime homeowners, many on fixed incomes, afford the higher taxes that result from rapidly increasing property values in most parts of that county.
But business groups have complained that they would have to shoulder more of the property tax burden if the governor signs the bill into law. And since the assessment cap would not apply to apartment buildings with more than six units, renters could have to pay more too.
"The people who benefit are those whose property assessments are going up more than 7 percent, but everybody else is hurt," said state Sen. Chris Lauzen, R-Aurora.
The bill would allow all counties to cap assessment increases at 7 percent a year, but at this point only Cook County is poised to adopt the limit. Downstate lawmakers said such a cap would be unlikely to help homeowners in most other counties because property assessments are not increasing as quickly outside of the Chicago area.
SB2112 would also increase the general homestead exemption for a homeowner's primary residence to $5,000. Current law sets that exemption at $4,500 for Cook County homeowners and $3,500 for the rest of the state.
Property owners age 65 and older currently get an extra exemption of $2,500 in Cook County and $2,000 in the other 101 counties. The legislation approved on Tuesday would make the senior citizen exemption a uniform $3,000 statewide.
The exemption is subtracted from the home's assessed value before taxes are calculated.
A $150,000 home, for instance, should have an assessed value of $50,000 – a third of its market value. The current homestead exemption would lower that to $46,500; the new exemption would make it $45,000.
In Champaign, that would mean a tax savings of about $115. The increased senior citizen exemption would lower taxes on such a house by another $77 in Champaign. An increase in the home's assessment, though, could offset some or all of the savings from the exemptions.
The Senate voted 30 to 27 to approve the legislation, which Blagojevich is expected to review and sign into law.
State Sen. Rick Winkel, R-Urbana; state Sen. Dale Righter, R-Mattoon; and state Sen. Dan Rutherford, R-Chenoa; all voted against the bill.
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