Joliet to close transfer tax loophole – Shaw Local

The city plans to close a loophole that officials say allowed property sellers to skip over unpaid utility bills.

Joliet Assistant City Attorney Chris Regis told a city council committee this month that rental property owners in particular “have a good plan in place” in which they can falsely claim that a property is exempt from the city’s real estate transfer tax upon filing a deed with the county.

“I can tell you on Tuesday that we lost $9,000,” Regis told the Land Use and Legislative Committee at its Aug. 11 meeting.

The amendment would require Joliet to certify that no taxes or utility bills are due to the city before a deed can be submitted to the county clerk for the transfer of ownership.

Regis said the city’s ordinance is now so loose that a property owner can simply write the word “exempt” on forms submitted to the county and escape any claims on unpaid municipal bills and taxes before the transfer of ownership.

“They want to maintain this system by keeping this loophole open,” Regis said.

The committee had previously tabled the issue following concerns raised by representatives of the real estate industry.

This time, the committee voted 3-0 to change the city’s ordinance, which will go to the full council for approval in September.

The amendment was recommended after the controversial filing of a proposal to add single-family rental residences to the city’s rent inspection program at the request of landlords and real estate agents.

The local real estate industry did not fight the change in property transfer tax rules, although they had previously opposed it.

Regis said cities the size of Joliet have generally put in place the rules that would be put into effect by the amendment to the city’s real estate transfer ordinance.