A coalition of real estate, construction and business groups wants a judge to prevent voters from deciding the fate of the election. Real estate transfer tax proposal This is to fight against homelessness in the upcoming March primary election.
In a lawsuit filed Friday in Cook County Circuit Court, the group says the ballot language combines questions that violate the Illinois Constitution and state law and should be prohibited from appearing on the March 19 ballot. argues that it should. The lawsuit is the latest effort by opponents to block the referendum question, making it a top priority for Chicago Mayor Brandon Johnson, progressive aldermen and advocates to spend an estimated $100 million on homelessness prevention. It is a matter of concern.
Plaintiffs seeking to block the referendum include the Chicago Association of Building Owners and Managers, a trade group for the city’s commercial office building industry, which claims that “the city’s largest office building, We are proud to represent a portion of Chicago’s commercial real estate industry that has been significantly impacted by the… According to the complaint, he proposed a referendum.
Other plaintiffs include the Chicagoland Apartment Association, the Neighborhood Building Owners Alliance, and the Women in Construction Owners and Executives (WCOE) Chicago Caucus.
At the city council meeting in November passed a resolution It would let Chicagoans decide whether a one-time tax on the sale of luxury real estate should be adjusted to a graduated, marginal tax. Under the proposal, assets worth more than $1 million would be taxed at a higher rate, while assets worth less than that would be taxed at a lower rate. The tax is estimated to generate at least $100 million a year, which the city plans to use to combat homelessness.
Plaintiffs allege the following in their lawsuit: State Law The law establishes a specific process by which cities can adjust real estate transfer taxes, and says it is illegal to include tax breaks for properties worth less than $1 million. The lawsuit alleges that state law allows voters to impose new transfer taxes or increase existing transfer taxes, not reduce them. Plaintiffs argue this is to prevent legislative “logrolling,” the practice of combining unpopular bills with more favorable proposals to pass them.
The complaint claims this is a “textbook example” of logrolling.
“They combine popular ideas (tax cuts) with unpopular ideas (tax increases) in order to pass unpopular ideas,” the complaint alleges.
The lawsuit also states that the ballot language violates the Illinois Constitution because it is a “complex question that combines three separate questions,” meaning voters must decide on each of the three separate tax changes. They argue that they should be allowed to do so.
of voting language It specifies that revenue from this tax will be used “for purposes of addressing homelessness, including the provision of services necessary to obtain and maintain permanent affordable housing and permanent housing in the City of Chicago.” .
But opponents say in the lawsuit that the phrase “addressing homelessness” isn’t specific enough for voters to judge, and that “voters have no idea what will or won’t be done with the money raised.” No further explanation has been given.” And who makes those decisions? ”
If approved by voters, the matter would go back to the City Council, which would pass additional ordinances that would create a dedicated revenue fund and specify how it should be spent, in addition to implementing the tax changes. The complaint argues that the ballot question cannot “stand alone” because it relies on additional action by aldermen and city officials.
The lawsuit has been filed against the Chicago Board of Elections. Spokesman Max Bieber said in a statement Friday that as an agency independent of the city, the Board of Elections is not the appropriate defendant in the case. He cited the city itself and the City Council as entities that should be targeted in the lawsuit.
“The Board had nothing to do with the initiation of this referendum issue and has no involvement in the outcome of the referendum or the litigation. We will place the question on the ballot as certified,” Bieber said in a statement.
Aldo. Carlos Ramirez Rosa, 35th District, said multiple attorneys reviewed the language on the ballot to ensure it properly complies with state law, the latest move by real estate industry groups to avoid tax increases. He claimed that it was an initiative of
“They have misrepresented what this is and what it will entail at every opportunity, because they have misinformed the public in order to avoid paying their fair share of taxes as much as possible. “Because we’re trying to do that,” Ramirez-Rosa said. “This is their hurray for this lawsuit.”
Doug Schenkelberg, executive director of the Chicago Homeless Coalition, part of the Bring Chicago Home campaign, echoed similar sentiments.
“This lawsuit is a political ploy orchestrated to protect the interests of greedy landlords and multinational real estate companies at the expense of black, brown, working class, and homeless Chicagoans,” Schenkelberg said. he said in a statement Friday. “This legal challenge is a last resort, a desperate attempt to deprive Chicago voters of their right to have their voices heard.”
Ballot initiative campaigns are starting to heat up in the lead-up to the March primaries. Volunteers to help will be spreading out across the city this weekend, knocking on doors and conducting virtual phone banks.
The End Homeless political action committee said it has raised $719,052 to support the referendum since the council passed it in November. Most of that cash came from Michael Reese Health Trust and Service Employees International Union Healthcare in Illinois and Indiana.
At least one PAC opposing the proposal, REALTORS® Against Real Estate Transfer Taxes, has since raised approximately $114,000 from Illinois and national realtor associations.
Last year, a postcard paid for by the PAC warned property owners in capital letters: “To Chicago Property Owners: Your taxes are going up!” Residents were urged to vote against the resolution before it was approved by City Council.
Critics of the tax argue that real estate transfer taxes are not a stable source of revenue and that increasing taxes would increase the burden on renters and lead to a downturn in the real estate market, especially commercial real estate in downtown Chicago. . is still recovering from the downturn in usage caused by the pandemic.
But for years, homelessness prevention activists have called on the city to create a dedicated funding source to provide housing and support services to the homeless. Increase in number of people experiencing homelessness In Chicago. The Johnson administration previously said affordable housing projects would be exempt from tax increases and that tax breaks on properties valued at less than $1 million account for nearly 96% of all Chicago real estate sales.
Tessa Weinberg and Mariah Wolfel cover Chicago government and politics for WBEZ.