Gov. Pritzker appointees’ plan shifts a mega property tax burden

The Illinoisans are already confronted with the highest land taxes in the country, but legislators and people appointed politicians close to Governor JB Pritzker pushed a law on the “Megaproject” of the survey which could trigger the greatest redistribution of real estate tax in state history – going from billions of megadévelopers politically connected to ordinary families and small businesses.

Instead of reducing taxes for everyone, Pritzker and its allies try to put a two -level system: low taxes for politically connected taxes and at the heaven for everyone. It is the capitalism of cronyism, not equity.

Telegraph of the position of the administration, president of Pritzker at the Maison de l’Illinois Economic Development Corp., John Atkinson, recently wrote a spur In the gallery praising an invoice from the house of Illinois – Sponsored by the representative Jay Hoffman, head of the assistant majority. The Megaproject idea, initially presented by the Senator of the Democratic State Ann Gillespie, has developed. Similar megaprojects bills were tabled by state representative Mary Beth Canty in the House and Senator Mark Walker in the Senate. All these bills on megaprojects would grant massive land tax reductions for promoters in the name of land tax certainty.

The invoices are so bad that, if they are promulgated, they could potentially double the property tax invoices for families near megaproject sites in a state that Classified n ° 1 in the country in 2023 for the highest land taxesAccording to the Illinois Policy Institute.

Atkinson highlighted An Ohio State program which allowed the City of New Albany to give a break “100% reduction in property tax” for 30 years to win a campus of 20 billion semiconductor dollars. Left of the argument of the named of Pritzker: the measure allows local managers to sorely pour the presentation of taxes on companies on workers’ families and rue Main via a quarter of property tax. MEGAPROJECT BILL’s cronyism gifts are similar.

Here’s how it works. The bill locks the evaluated values ​​of megaprojects designated for 23 to 40 years, while the value of real estate properties continues to increase. A package bought for $ 200 million, but later integrated into a $ 5 billion complex, is still imposed on the figure of $ 200 million. This represents approximately a tax reduction of 96%.

A development of $ 5 billion in Arlington Heights normally owed around 238.5 million dollars per year in property taxes. With its equalized valued value frozen at $ 200 million, it would only pay $ 9.5 million a year, which would lead to a break of $ 229 million per year. During a 40 -year designation (excluding the “investment” period of seven years), the developer’s break could easily exceed $ 7.5 billion.

Local governments do not complain about this bill because they are protected by the provision which values ​​megaprojets with full value of just cash value in order to calculate the tax ceilings and the bond limits. This makes it possible to pass the land tax relief of $ 7.5 billion on other land taxpayers in each jurisdiction.

Why would local governments accept such a gross and unfair agreement for residents? Because the bill allows them to conclude special payment agreements with developers, the money they can boast as new income, while avoiding the approval referendums normally required for higher taxes. These special payments do not have to correspond to normal taxes, do not have to finance the essential services and can even return to the developer in disguised subsidies, such as the payment of parking garages and infrastructure which should normally be paid entirely by the developer.

This is only the last chapter of the Springfield social gaming book. The pritzker administration has already showed selective grants on green energy, film production, electric vehicles and data centers – always celebrated with ribbon cuttings and press releases. But a 2018 Study of the Mercatus Center noted that if Illinois eliminated incentives to economic development, this could reduce corporate income tax by 9.5% to 6.36%, state sales tax by 6.25% to 5.75% and individual income tax of 4.95% to 4.75% without loss of income.

The named appointed by Pritzker says: “Above all, there are no dollars in the state game”, but the bill itself contradicts this assertion. In its opening provisions, the bill authorizes megaprojects to be certified for exemptions from the State tax and local use and the occupancy tax of retailers on the construction materials used to build the project, potentially reducing the normal collections of sales tax of hundreds of millions of dollars.

It’s bigger than dollars and hundred. THE Declaration of independence says that “all men are created equal”, a principle reported by the American Constitution Equal protection clause and the requirement of the Constitution of Illinois for uniform taxation. The bill on megaprojects and other laws betray the principle of equal treatment by raising millionaires and billionaires above their less affluent neighbors, by institutionalizing inequalities and by punishing those who have no political ties.

Under the threshold of $ 100 million proposed by the bill, hundreds of previous projects would have qualified, in particular Trump Tower in Chicago. Imagine being forced to subsidize the land taxes of a developer whose policy you despise – or in competition as a small company against a company of several billion dollars paying a fraction of your tax rate.

The best way is clear: a fair tax system for everyone, where the alleviation comes from large reforms This drop in taxes for each owner, tenant and small business, not dear offers for billionaires. The bill on megaprojets is the most dangerous social protection regime that Illinois has seen for decades. Pritzker should reject this megadisaster before it yet undermines the already imperfect tax system of our state.

Brian Costin is deputy director of Americans for prosperity-illinons.