Tax Policy Initiatives

Voice Owner’s Network (VON) Program

Equal Treatment for Multi-Unit Rental Properties in Community Land Trusts

In recent years, and with the Cook County Assessor’s commitment to transparency and collaboration, there has been improved communication between local community land trusts, primarily encompassing residential and condo ownership housing, to periodically adjust valuations based on “limited equity resale” requirements. When these affordability requirements are considered, property values and taxes are reduced. A leader in making this kind of relief more systemically and predictably possible has been the quasi-governmental Chicago Community Land Trust agency, now called the Chicago Housing Trust. 

Voice is in conversation with the Assessor’s Office to begin treating multi-unit rental or shared equity housing in community land trusts the same way.

Assessment Policy on Permanently Affordable Housing

In general, assessments are typically made at the “market value”, essentially the highest estimated reasonable re-sale price for the property, considering income potential or comparable sales data.   Voice’s efforts are to instigate valuations as “affordable housing” documenting fully about how the property is regulated as affordable, via government funding and subsidy contracts (like HAP or HUD agreements).  The Assessor has been gathering financial information i.e. RPIE System, from property owners to better understand and document the affordable housing that is in Cook County. However, many developments are affordable, but treated as market rate, including buildings that have mostly rent-subsidized tenants, or have residents that are intentional communities, or projects that have purposeful mixed-incomes

Voice is in conversation with the Assessor’s Office, the Board of (Tax Appeals) Review and prospectively with the State Department of Revenue to have “Land Leases” or Covenants of Affordability, with requirements that run with the deeds to property, be verification of “affordable housing status” in valuation and appeals.  Such covenants or leases are a qualifying component for properties to be included in the new Dovie Thurman Affordable Housing Trust.

Social Cost Accounting to Inform Valuations and Tax Appeals

Affordable housing providers know that a variety of costs are absorbed in the management, support and preservation of affordable housing properties.  The labor and cost intensity of projects is much higher than for peers in private sector, market-rate housing. Many of these costs, including in-kind contributions to project or residents, resident services funded separately via non-profit or social service agencies, or added compliance costs included in property management fees (from everything from tenant selection to lease enforcement) – are not reflected in Income Statements used as a primary point of reference for property valuations and appeals.  Voice has been meeting with commissioners of the Cook County Board of (Tax Appeals) Review during the last two years about supplementing evidence normally submitted for property tax appeals with social costs data that can be properly backed-up and documented, including some “unrealized revenues” that cannot be normally classified as expenses using GAAP accounting standards.  Voice piloted this approach in 2022 appeals successfully.  Voice is working with the new board commissioner for District 2 (Northside), Samantha Steele, to conduct a workshop training and “Meet the Commissioner” event in July 2023 for affordable housing owners hosted by Sen. Michael Simmon’s Office.  This knowledge, training and process potentially could have national significance in the field of valuations and appeals.  

The knowledge of using social costs in valuations and appeals can be shared more broadly as a Chicago delegate agency, TACOM and prospectively as TACIT agency, and the policy and procedural work with public officials will be ongoing. 

Expanded Eligibility for Charitable Tax Exempt Status

There is a way to achieve property tax exemption for properties for housing sponsor deemed “charitable” by the Illinois Department of Revenue.  This is a very bureaucratic and expensive process. It is typically only recommended for projects that have HUD/HAP contracts and project based rental assistance units.  This is because in no small measure because of additional requirements NOT to evict residents by virtue of verifiable financial needs.  Voice is pursuing such property tax relief on three properties slated for inclusion in the Dovie Thurman Affordable Housing Trust, which requires guarantees of permanent affordability, by either Covenants or Land Leases executed with affordability required and not subordinated in other ways. In addition, affordable properties within Tax Increment Financing (TIF) districts that utilize TIF funding, are ineligible for property tax exemptions. Until and unless numerous other contradictions and issues with TIF regulations is addressed, this prohibition should be set aside.

Voice’s agenda here is to expand eligibility for property tax exempt status to properties deemed “permanently affordable”.