A Legislative Symposium recap; Dr. Merriman’s slides available for download
Tax shifts and other unintended consequences often accompany assessment caps and other attempts to “fix” property taxes, a University of Illinois-Chicago economist said Thursday.
While assessment caps enacted in Cook County, Ill., did lower property taxes for some, many others wound up paying more in property taxes because of a tax shift, Dr. David Merriman said at OpenSky’s Legislative Symposium at the State Capitol.
“Be careful,” Dr. Merriman said regarding the use of assessment caps. “The cure may be worse than the disease. You may create more problems than you’re fixing.
“My philosophy is to determine the problem you’re trying to solve and then target the solution directly at that problem.”
Other ways to address property tax concerns include more targeted measures like circuit breakers for those with high property taxes relative to their incomes, Dr. Merriman said.
Dr. Merriman also discussed Tax Increment Financing – or TIF – and some of the concerns related to its use.
There are transparency concerns regarding TIF, Dr. Merriman said, because TIF spending doesn’t run through the typical budget process and therefore doesn’t go through the same scrutiny that applies to other appropriations.
Dr. Merriman also noted that academic research shows mixed results regarding TIF’s effectiveness as an economic development tool.
“It’s pretty bleak if you’re a TIF supporter that there is no consensus among researchers that TIF has been successful in achieving its economic goals,” Dr. Merriman said
Download a PDF of Dr. Merriman’s PowerPoint presentation from the Legislative Symposium.