More Mass Transit Thoughts from Overtaxed Suburbia

Some have suggested that I have merely re-fighting a battle I lost in 1974.

Whatever the reason, mass transit thoughts keep rising to the surface of my consciousness.

Today I offer three ideas, one political and two substantive.

The political thought is

Governor Rod Blagojevich has handed the General Assembly a strategy to raise sales taxes over his veto in which those casting the crucial final votes can escape political punishment at the polls.

The deadline for passage as far as the Chicago Transit Authority is concerned is now November 4th.

Know what day November 5th is?

It’s the filing deadline for state representative and state senator.

If the General Assembly can stall that long, marginal members may be convinced to vote for the bill knowing that the odds of an outraged potential challenger getting 500 (state rep.) or 1,000 (state senate) signatures within a day are slim.

And they can vote to override the Governor’s veto after the end of filing.

The first substantive suggestion is

a logical way to finance whatever deficit the CTA has.

A property tax.

Before you beat me about the head with aluminum bats, consider that that the value of property in Chicago is largely dependent on its access to mass transit. Certainly, that is a major reason, if not the primary reason, that property value in and near the Loop is so high.

Likewise, real estate in poorly served parts of the city is less valuable.

So, those who receive the most value from mass transit would pay the most; those receiving the least value, the least.

I am certain the fact that more Metra trains stop at Crystal Lake than anywhere else in McHenry County makes local property values higher than they would be otherwise.

Now, my preference would be the unrefined approach of 19th Century economist Henry George, that is, a tax on only the land. (This approach has the result of encouraging maximum development of land, since the tax on a particular parcel would be the same whether an empty lot or a high rise. Think of all the problems that could be avoided with such a tax system in Chicago or anywhere else.)

One final thought.

Residential property taxes in Chicago are about the lowest in all of Illinois.

My information comes from the Illinois Department of Revenue’s Property Tax Statistics. It has information on “effective tax rates” that show Chicago about as low as one can go in Illinois.

An “effective tax rate” is defined as one’s tax bill divided by what one could sell one’s house for.

Figure out your own by getting the value of your home from Divide the number there by your annual real estate tax bill.

Not a big surprise, but the Illinois Revenue Department stopped calculating effective tax rates about the time Democrat Rod Blagojevich took office. There is a couple of year lag time, so the most recent and, sorrowfully, the last comparisons of relative property tax burdens throughout Illinois is for the 2000 tax year.

I found Chicago’s effective tax rate for residential property on page 46 of that year’s Illinois Property Tax Statistics. (You’ll have to scroll down to Table 10. You can find what the effective tax rate is for your town, if it is large enough. This is a double-sided table, so it’s a bit tricky.)

Chicago homeowners paid 1.1% of the value of their homes in real estate taxes for the 2000 tax year payable in 2001. That ranks 521st lowest out of 533 Illinois communities for which the effective tax rate was calculated.

So, don’t tell me Chicago property taxes are too high unless you can produce an up-to-date effective tax rate for the city.

Most of Crystal Lake (the Algonquin Township part) the effective tax rate is 2.05%–ranking 203rd. The Village of Algonquin in McHenry County and Algonquin Township was 1.89%, ranking 286. McHenry was ranked 251 at 1.96% in McHenry Township.

The second substantive suggestion is

allowing legalized jitney cabs to take up the slack.

I think I had a bill drafted to allow jitneys passing a safety inspection and proper insurance for a group of conservative legislators whom I was helping in the late 1980’s or early 1990’s. The idea is still a good one.

Not just where the Chicago Transit Authority finds it uneconomical to run buses, but anywhere in Chicago.

I know that the “powers that be” would favor this no more than they would a property tax to finance the CTA, but it also makes all kinds of sense.

Look at the price of taxi medallions.

Clearly there is room in the market for more cab-like transportation.

Of course, bailing out the CTA is not about logic or even transpiration.

It is about patronage and forcing suburbanites to subsidize downtown office buildings.

And you can read more of some of that here.

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