Chicago transfer tax hike on deals over $1 million blocked

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Aldes. Matt Martin, Maria Hadden and Daniel La Spata are supporters of the Chicago real estate transfer tax (Facebook, sarah-ji from Midwest, USA, CC BY-SA 2.0, via Wikimedia Commons, Getty)

Supporters of a move to more than triple Chicago’s real estate transfer tax on transactions of $1 million or more to fund homelessness initiatives suffered a setback on Monday as a special meeting on the proposal lacked a councilor to achieve quorum.

A group of advocates, including city council progressives, are pushing to dramatically increase real estate transfer taxes on real estate sales of $1 million or more, for both commercial and residential trades. The additional tax revenue, which the group estimated at $163 million a year, would go to city programs providing housing for Chicago’s homeless.

The campaign, titled Bring Chicago Home, would ask voters in the February mayoral election whether it can garner enough support from council members to send the measure to the ballot.

That seems less likely to happen unless the proposal undergoes some tweaking, however, after aldermen declined to show up for the meeting, indicating some were reluctant to voice support or opposition as it was written.

Aldus. First Ward’s Daniel La Spata said in a tweet that the campaign “would be a transformative step to end homelessness in the city, but 25 alders couldn’t even come to a city council meeting to discuss it.” .

Mayor Lori Lightfoot attended the initial meeting at 9 a.m. but missed the session when council reconvened later in the day in another failed attempt to achieve a quorum to discuss the proposed hike. transfer rights. Lightfoot said she opposed sending the measure to voters.

A spokeswoman for the Chicago Coalition for the Homeless, which supports the measure, said The real deal that proponents of the proposal were “regrouping” after the hearing was cancelled.

Chicago’s commercial and residential real estate associations oppose the idea. The management of BOMA/Chicago, a trade association of 240 commercial buildings in the city, said the proposal was made at the wrong time, with inflation and rising interest rates slowing or evaporating commercial real estate transactions. Sean Easton, a member of the Neighborhood Building Owners Alliance, said the tax hike would stunt growth and hurt small and medium-sized housing providers.

“They’re working to run businesses that are affordable for those tenants and there’s always some new policy being pushed on them that makes it harder for them to do their jobs,” Easton said.

A referendum by Los Angeles voters to raise property transfer taxes to tackle homelessness was set to pass last week as the election results rolled in, though the move only affects sales residential properties valued at $5 million or more with a 4% tax that would increase to 5.5% on transactions of $10 million or more.

Chicago’s current transfer duty rate charges buyers $3.75 for every $500 of a transaction’s value and the seller pays $1.50 for every $500. The city passed a transfer tax in 1974 and it is in addition to an Illinois state transfer tax of 50 cents for every $500 of a transaction’s value and a county tax of Cook 25 cents for every $500.

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