Property Tax Cutting & Raising Referendums in Non-Tax Cap Counties

State Rep. Allen Skillicorn asked the Legislative Research Unit to take a look at two questions:

  1. Could property taxes have been lowered by referendum before PTELL [FN 1] [called the Property Tax Cap by most folks]?  If so, did that ever occur?
  2. Is it still possible in the non-PTELL counties to do so?  If so, can a PTELL county revert to non-PTELL status?

McHenry County Blog will share the reply over the next few days.

Referenda to Increase or Reduce Property Tax Limits

Limitation to Non-Home-Rule Entities

In a 1980 case [FN23] the Illinois Supreme Court held that the referendum provisions are inapplicable to home-rule units.

The plaintiffs had petitioned for a referendum to lower the tax rate for the corporate fund of the Village of Glenview (a
home-rule unit) from 0.5783% to 0.4337%.

The Village Board voted not to place the proposition on the ballot, and the plaintiffs sought an order compelling it to do so, citing the referendum provisions (at that time in section 162a of the Revenue Act24).

The trial court denied the plaintiffs’ request, holding that the authority of the referendum provisions conflicted with the powers granted by the 1970 Constitution to home-rule units. [FN25]

The Illinois Supreme Court agreed and held that applying the statute would impermissibly restrict the taxing power granted to home-rule units. [FN26]

Referenda Requirements

Under the Property Tax Code’s referendum provisions, the corporate authorities of a taxing district, by resolution, can initiate a referendum to increase or reduce a property tax rate limit. [FN27]

Voters can also initiate a referendum to lower the rate limit (with or without publication of a new rate by the district authorities) by a petition signed by 10% of the legal voters in the taxing district. [FN28]

Propositions can be specific to a particular taxing year or series of years (at the discretion of district authorities); [FN29] can be submitted only once per year; [FN30] and cannot propose a change of more than 25% in the existing rate limit. [FN31]

These provisions specifically do not prevent a taxing district’s governing authority from choosing to implement a rate lower than the limit set by referenda. [FN32]

As stated above, the Illinois Supreme Court held that these provisions do not apply to home-rule units.

PTELL-Authorized Referenda

More tomorrow.

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