Springfield area residents pay some of the nation’s highest property tax rates

A progressive tax won’t stop constant property tax hikes. Pension reform will.

Illinoisans pay some of the highest property taxes in the country, but homeowners in the two counties surrounding Springfield pay the 14th-highest property tax rate among the nation’s large communities.

The average household in the Springfield area last year paid 2.33% of the value of their home in property taxes, or $3,176.  That ranks the metro area covering Sangamon and Menard counties 14th in the nation for areas with at least 200,000 residents, according to ATTOM Data Solutions. It is also double the national average in 2018 of paying 1.16% of a single-family home’s value in property taxes.

In Sangamon County, residential property taxes outgrew home values by 49% between 1996 and 2016. That translates to $446 worth of property tax increases per person when adjusted for inflation.

It would be one thing if the property tax hikes were boosting services, but pensions are driving property tax increases and outpacing taxpayers’ ability to pay. All of the property tax levied by the city of Springfield goes to pay for pensions.

Sangamon County property taxpayers see 95 cents of every $1 taxed for municipal police go to pensions, and the entire $1 taxed for fire services go to pensions. Growing pension obligations crowd out services and tie the hands of local governments during the budget process.

Illinois Gov. J.B. Pritzker is trying to convince state lawmakers to ask Illinois voters for a constitutional amendment allowing for a progressive income tax. Supporters claim the “fair tax” will be a magic solution to the financial woes plaguing the state. However, without serious pension reform, any progressive tax proposal will be consumed by pensions and inevitably lead to tax hikes on all Illinoisans.

Illinois voters in key state House districts oppose Pritzker’s plan.

In Democrat state Rep. Sue Scherer’s district – which covers Decatur and parts of Springfield – residents dislike Pritzker’s plan. Voters in the district view Pritzker favorably by 31% to 28%, but they oppose his plan to change to a progressive tax 41% to 32% – regardless of whether they have heard of his proposal. Given brief descriptions of both flat and progressive income taxes, voters said they would vote against changing to a progressive income tax, 50% to 39%. To amend the state constitution, 60% of voters must approve the proposed amendment.

Pritzker’s proposed progressive tax rates fall short of their $3.4 billion revenue target by at least $1 billion, according to an Illinois Policy Institute analysis. While Pritzker hinged many of his promises on increased revenue from a progressive tax, a new ad from Think Big Illinois – a group which lists Pritzker among their major donors – walks back the promise of tax relief for 97% of Illinoisans to only claim taxes will not be raised on them.

And in a walk back to the walk back, Pritzker told WLS-TV, Channel 7, in Chicago he couldn’t guarantee his tax plan won’t raise taxes later on those making less than $250,000 a year.

“As you know, we currently live in a system in which the taxes can be changed at any moment so there’s certainly no guarantees, but what I will tell you is that I am fighting for the plan that I put forward,” he said April 23.

The Illinois Constitution doesn’t need an amendment to remove protection of the flat income tax. Illinois needs to amend the state constitution to protect already earned pension benefits, while allowing for changes to future, unearned accruals.

For Springfield area homeowners who face one of the highest effective property tax rates, a progressive tax would depress job growth, accelerate population loss and leave fewer working families to share the property tax burden. And with Pritzker refusing to guarantee middle-class residents won’t face a state income tax increase, the only guarantee is of higher taxes and even more residents fleeing the burden.

Residents should contact their lawmakers and ask them to vote against the progressive tax amendment. Illinois needs pension reform, not higher taxes.