Rural Woodstock resident Susan Handelsman put the following together after reading about some of State Rep. Jack Franks’ bills.
Tax Relief Bills Won’t Approach Solving the Problem
Political proposals for property tax relief seem to focus on temporary freezes, along with rate cuts for narrow population segments.
These strategies won’t do anything to mitigate the toxic nature of McHenry County economy.
With most of McHenry County suffering property tax rates higher than 3% (Woodstock is 4.6%), local real estate represents a negative store of value.
Property tax rates this high distort all aspects of local economy.
PTELL [Tax Cap]-type tactics aren’t much relief.
Aside from loopholes you could drive a school bus through, tax-hike limitations offer no restorative relief.
Consider an actual example:
Woodstock CUSD 200 levy is $59 million on an Equalized Assessed Value of $719 million, making school portion of tax rate on total home value 2.74%.
Raising the levy 1% raises tax rate to 2.76%, raising the levy 2% brings tax rate up to 2.79%, levy up 3% = 2.82%, 4% = 2.84%, 5% = 2.87%.
(Note: 2.74% tax represents $2,740 per $100,000 of home value. In the past 24 years, CPI inflation has only exceeded 4% once, and only exceeded 3% five times).
As is apparent, the problem does not lie in arresting hikes valued at tens of dollars per hundred thousand of home value, the problem is the current tax rate for school alone which is double the national average.
In Woodstock the tax rate is 2.74% for schools, another 1% or so for Woodstock City and fire & rescue, and another 1% or so for Countywide taxes (MCC, MCCD, County and township government).
4.76% of total home value.
A 4.76% property tax rate proves by its very existence that local elected officials have no desire or ability to manage affairs within a reasonable budget.
Municipalities all over America manage to educate children and stave off social chaos for an average 1.4% property tax rate.
It is doable, but in McHenry County there is intractable resistance to doing it.
Clearly, outside intervention is needed.
In order for that intervention to be meaningful it must address current conditions.
Obvious solution: Tax Rate Cap. 2.5%, like Massachusetts although Indiana with its 1% residential property tax rate cap will remain comparatively attractive to potential residents).
Tax freezes are cold comfort to homeowners in McHenry County.