December 8, 2021

To be “woke” or to be county assessor? To accurately assess property valuations, pander to the far-left obsessed county Democratic Party, or to get dumped?

That is the conundrum of Cook County Assessor Fritz Kaegi, who is about to learn that no good deed goes unpunished. His GOOD DEED was to beat ethics-challenged Joe Berrios in the 2018 primary, but his “reforms” are not stopping – and are definitely contributing to — the rising property taxes for which he understandably gets the blame.

Kaegi promised in 2018 to “bring transparency and equity to a rigged system that put favoritism above fairness,” and to “eliminate distortions and biases in assessments so that the tax base is becoming more equitable.” His Web site trumpets that since his election he has worked to “eliminate favoritism and corruption” and “put people ahead of politics,” adding that nobody should pay “more than their fair share.”

Kaegi’s 2022 opponent Kari Steele promises to “put equity first” and “give relief to homeowners” while offering the tax dollars “necessary for the public services residents deserve.” Steele added that she wanted “stability for businesses,” which means that the commercial sector should bear a greater portion of the property tax burden and plan accordingly.

This begs the question: Since when did property taxpayers begin caring more about “equitable” taxes and less about low taxes? Or accurate valuations upon which taxes are based?

“Equity” under the law is defined as a resort to “general principles of fairness and justice whenever existing law is inadequate.” Do Kaegi and Steele mean the system of taxing based on fair market value is inadequate? “Fairness” is defined as “straight, square... with justice and honesty.” So, what’s the problem?

The problem is that there are 1.8 million parcels of property in Cook County, all of varying uniqueness and value, and any valuation aside from a recent sales price is entirely subjective. And it is the assessor’s standard of subjectivity which is now and always has been a matter of controversy. What is a fact is that a 2018 “Tax Divide” study claimed the assessor’s past policies, including its ability to arbitrarily “adjust” assessed valuations downward when appealed, “shifted the property tax burden from the wealthy to the poor.” It is also a fact that Joe Berrios lost largely due to revelations that he over-assessed minority areas.

County Democratic slate makers will meet Dec. 13 and 14 and their options are to either (1) endorse and re-slate Kaegi, (2) dump Kaegi and slate Kari Steele or (3) make “no recommendation” and let each of the 50 Chicago ward and 30 suburban township committeepersons choose in a Kaegi-Steele primary on June 28.

There were 1,016,178 votes cast in the March 2020 Democratic primary, and a weighted vote is assigned to each committeeperson based on that primary’s vote in their ward/township. The number for slating is 508,089. My survey of committeepersons shows a decisive edge for Steele, a woman who has been Metropolitan Water Reclamation District (MWRD) president since 2019. Her campaign is based on both identity politics and trade union self-interest. She has been endorsed by the Black Caucus and Latino Caucus, by left-leaning groups and, most importantly, the Chicago Federation of Labor (CFL).

Even more importantly is Steele’s endorsement by Teamsters Joint Council 25 and Local 150 of the Operating Engineers (IUOE), who represent the MWRD’s blue-collar workers, over half of the 2,000 employees. “When you see a crane it’s on a construction site and operated by a IUOE member,” said a committeeperson supporting Steele. Kaegi’s policies have resulted in raising property taxes on commercial sites, which is “depressing” construction, he said.

Steele’s demographic coalition is formidable: She is from Chicago’s South Shore and will get the support of the 5 area committeepersons (4 of whom are female); she has been endorsed by the committeepersons from largely Black south suburban Rich and Thornton townships; she has backing from Schaumburg and Evanston (which is congresswoman Jan Schakowsky’s base), and has been endorsed by party organizations in the 41st, 38th and 39th wards on the Northwest Side. African-Americans comprise about 40 percent of the Democratic primary electorate, and women more than 55 percent. Those identity bases, plus a third of the White vote is enough to win both slating and the primary.

Kaegi is endorsed by U.S. Representatives Jesus “Chuy” Garcia (D-4), Marie Newman (D-3) and Robin Kelly (D-2), and a handful of north Lakefront committeepersons. That is not going to be enough.

Kaegi in 2018 defeated incumbent assessor, the slated Berrios,  327,769-243,425 in the primary, getting 45 percent, with a third candidate getting 147,224 votes. He was thereafter lionized by the media and the left as a reformer. Now he is disparaged as a disappointment.

And why is that? The assessor’s office sets the assessed valuation (AV) on the county’s 1.8 million parcels of residential and commercial property and assigns each a PIN. The AV is 10 percent of the value, which is multiplied by the tax rate to get the tax bill. COVID affected the housing market, creating commercial vacancies, unpaid apartment rental revenues, and a shrunken inventory of residences on the market.

It was a classic case of supply-and-demand, as the demand for rented commercial/rental properties exceeded supply, boosting prices, but demand for properties with vacancies did not equal supply, depressing prices. And the demand for housing far exceeded the supply, boosting prices which - when coupled with 6.2 percent 2021 nationwide inflation – were up about 17 percent in 2021 over 2020

Chicago ‘s reassessment occurred in 2019 for 2020, and the south suburbs in 2020 for 2021. As a result, tax rates were set at 7.1 percent in Chicago (because property was under-valued) for 2021 while tax rates were over 20 in the south suburbs (because property was re-valued), with homeowners in suburbs like Berwyn, Cicero, Maywood and Riverside getting $1,000-plus hikes in 2021. The northern suburbs were reassessed in 2021 and will get their tax bills in 2022. Since elected, Kaegi’s office hiked the valuation on business property, increasing revenues by 6.2 percent, according to a report from the county treasurer. And that caused a major pushback from the business community.

Any tax hike is reflected on the second installment bill, as the first is half the prior year total. The “notice of assessed valuation” is mailed in March, before the June 28 primary. Ire will ensue if homeowners realize that their new AV is higher, and subsequently a likely higher tax bill, the ire will be directed toward Kaegi.

Kaegi – and his consultants – have a messaging problem: Against an African-American woman, what is his argument for re-election? Steele will tout herself as a “woman who has managed an agency with a $1.2 billion budget” (as she said in a mailing to party leaders).  That has nothing to do with an office whose sole job is to set AVs and handle appeals. One option is to make Berrios the comparative bogeyman: “He was bad and I fixed it.” But voters have long forgotten Berrios’s misdeeds.

The other possibility is to hype his record: “I made your taxes fairer...and more EQUITABLE.” That may elicit a great big yawn from some. Compared to what? Fairer than what? Kaegi may be perceived as obscure now as he was in 2018. His vote was anti-Berrios rather than pro-Kaegi. Going into 2022 he’s just another guy with an odd name. He could raise $3 million (he already has $1.3 million), but it will matter not.

Prediction: Identity politics is now an ingrained part of Democratic voters’ psyche. Steele will get slated and, in a low 725,000 turnout, win with 57 percent. 

MWRD: There are 4 slots to fill – three 6-year commissioner terms and one 2-year vacancy term. A total of 13 supplicants appeared at pre-slating, and the primary will have a multiplicity of candidates.

CIRCUIT COURT: It was thought that the aftermath of COVID, with an expected glut of backlogged cases, would precipitate a mass exodus of judges. After all, working by Zoom from one’s couch or vacation home a few hours a day was a great gig. But now judges are back, the backlog is staggering, but most judging is done in chambers on Zoom – which still makes it a great gig. Judges are not working overtime, like a 12-hour day.

So, there are only 10 Circuit vacancies and one Appellate vacancy, and there are 40 supplicants who appeared at pre-slating in September.

Identity politics will be paramount at slate making.