Daily Development for
Wednesday, February 25, 1998

by: Patrick A. Randolph, Jr.
Professor of Law
UMKC School of Law

Thanks to Janet Johnson at Schiff, Hardin & Waite in Chicago for this one:

TAXATION; VALUATION: Increased assessment on an individual parcel of real estate based on a recent sales price for that parcel violated the Illinois Constitutional provision requiring real estate taxes be levied uniformly where the majority of the rest of the county's real estate is appraised using a "mass appraisal" method.

Walsh v. Property Tax Appeal Board, 1998 WL 66724 (Ill.1998)

The county, for the prior forty years, had applied a general reappraisal method that applied to each parcel an adjustment based upon the average increase in real estate prices in the entire township. According to the court, "until such time as Taxewell County systematically ascribes true fair cash value to all like properties, [the property owners] are entitled to the benefits they have accrued under a uniform, though flawed, basis of valuation."

The evidence in the case showed that the increase in the appraised value for the property in question was 39% using its most recent sales price, while the average increase applied to other properties in the township was 11.7% (even though the range based on actual sales prices was between 7% and 68%).

Reporter's Comment: While Tazewell County is a downstate rural county in Illinois, a similar "mass appraisal" process has been used for years by most Illinois counties, although some have attempted to reappraise all properties based on their actual cash values on a periodic basis. With the staggering number of real estate transactions that occur each year in the Chicago metropolitan area and massive number of individual parcels involved, attempting to re-appraise each parcel of real estate each year is impossible. Cook County attempts to re-appraise 1/3 of the County's parcels every year, so that each parcel is theoretically reappraised every 3 years, but even in that system the average increase statistics provided by the State are used.

Editor's Comment: In the editor's experience, the "average increase" method is a commonly used method, and he has seen it combined with "sale price reevalutation" as well. Is this case the beginning of a trend that would undo those approaches and lead to a revision of valuation mechanisms nationwide?

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