Chicago Property Tax Hikes Will Fund Most Of CTU Contract Settlement
This ARTICLE On Chicago Property Tax Hikes Will Fund Most Of CTU Contract Settlement Was PUBLISHED On November 8th, 2019
Here we go again Chicago.
- Chicago is the highest taxed city in the nation
- Chicago has the highest property tax in the U.S. Illinois has the second-highest property tax rates in the nation
- New Jersey is the state that leads to the highest property tax rate
- Illinois is expected to surpass New Jersey by late 2020 as the state with the highest property tax in the country
- Chicago has its own city tax among its taxpayers
- Property taxes in Chicago has been going up every year since the 2008 Great Recession
- Most of our viewers have heard about the Chicago Teacher’s Union strike
- The strike ended with a settlement between the CTU and Chicago Mayor Lori Lightfoot
- Where is the money coming from?
- It turns out Lightfoot will use Chicago Property Tax Hikes as the source to fund most of Chicago Teachers’ Union $1.5 billion contract
In this article, we will cover this breaking news on Chicago Property Tax Hikes Will Fund Most Of CTU Contract Settlement.
Chicago Property Tax Hikes Of $100 Million Needed
The only way Chicago Public Schools can pay the CTU Contract Settlement is by increasing its budget by $100 million a year and aid from the state of Illinois.
- Illinois can possibly pay and assist Chicago but only if J.B. Pritzker’s graduated income tax gets passed and enacted
- Chicagoans, already paying the highest property taxes in the nation, now face an additional Chicago Property Tax Hikes in the coming year
City officials are all in agreement that property owners will definitely be on the hook to fund most of the CTU shortage on the $1.5 billion contract settlement.
What Experts Are Saying About Chicago Property Tax Hikes
Michael Gracz of Gustan Cho Associates Mortgage News who has been following this story from the beginning of the CTU strike said the following:
Right behind Chicago Property Tax Hikes in the pay line will be those subject to Gov. J.B. Pritzker’s proposed graduated income tax—if it’s approved by voters in a referendum a year from now, that is. CPS officials have been relatively mum about who will provide the extra $1.5 billion needed under the five-year CTU deal. But after saying in a statement yesterday that costs associated with the contract with CTU and a division of SEIU will be exceeded by the growth in revenue from existing state and local revenue streams in future years. Existing property taxes will be the leader. Under our current property tax levies, we have seen additional revenue between $100-200 million a year ($181M in FY18 and $102M in FY19). In the years ahead, we expect to see similar levels of growth, which on its own would cover approximately $500 million in annualized additional spending by the end of the contract. That appears to mean that CPS will continue its traditional policy of levying to the cap, or imposing as much of a hike as is allowed under state property tax laws.
The above proposal is angering Chicago homeowners and property owners. Chicago Public School’s property tax collections have gone up a third from $2.36 billion in 2016 to $3.124 billion according to the Civic Federation.
How The New CTU Contract Settlement Affect Chicago Property Owners
Chicago property owners are already burdened by the city’s high property taxes.
- Chicago also imposes its own sales taxes and other taxes
- Everything in Chicago is more expensive
- Cigarettes, alcohol, and gas are much higher than the rest of Illinois due to additional city taxes
- Now, with new Chicago Tax Hikes, Chicagoans will have less disposable income
- High Chicago taxes are also forcing businesses and individual taxpayers to leave the city to other lower-taxed states
- For example, Midland Metals Products relocated to neighboring Indiana due to the high city and state taxes
- The company has been based in Chicago for the past 98 years
- The company said enough is enough and pulled the trigger
- This cost Chicago 150 full-time jobs
- High taxes often mean lower property values
High taxed states like Illinois and New York are seeing a mass exodus of businesses and individual taxpayers.
Illinois Versus Other Thriving States
Why are certain states like Indiana, Kentucky, Florida, Texas, Mississippi, Alabama, Tennessee raking in billions with record population growth and Illinois in financial turmoil? Other lower-taxed states are aggressively outreaching businesses and taxpayers to lure them to relocate there. Kentucky has billboards posted along I-57 luring Illinoisans. Many states are offering incentives and contacting companies to consider relocating there. Tennessee, Nevada, Florida, Indiana, Texas and a handful of other states do not have state income taxes which is attracting countless residents. Increasing property taxes and other taxes will backfire on high-taxed states like New York, Illinois, California, and others. What is Chicago and the state of Illinois doing to attract businesses and taxpayers? Raising taxes and imposing new taxes is not the solution. Incompetence among politicians is very dangerous. Raising and increasing new taxes without drastically cutting spending is a very thing to do. The CTU contract settlement and raising $100 million a year is not the only crisis the city and the state of Illinois are facing. Both Chicago and the state have a major pension debt shortage crisis. In a way, politicians are running a Ponzi Scheme by raising taxes to meet the annual pension shortage with no long term solution. Gustan Cho Associates Mortgage News will keep our viewers updated on this developing story as it develops. Stay Tuned!!!