Notes from the Assessor

From the Summer, 2008, Wayne Township Newsletter

Michael E. Musson, C.I.A.O.
(630) 231-8900 Fax: (630) 231-9534
e-mail: assistance@waynetownshipassessor.com
Website: www.waynetownshipassessor.com
Interactive Voice Response (630) 231-1334

My staff and I continue to hear from many property owners who are concerned about the downturn in the real estate market. As homeowners and property tax-payers, my staff and I are aware of the frustration of seeing property taxes continue to rise, amid reports of plunging values, increased foreclosures, and properties remaining on the market for extended time periods.

It is the responsibility of my office, as required by Illinois state statutes, to annually assess properties at one-third of the fair market value. The law requires that we value properties as of January 1st of each assessment year, based on the prior three years of sales. In periods when sale prices are increasing rapidly, as they had been for many years prior to 2007, the use of three years of sales ensures that dramatic price increases affect assessments gradually. On the reverse side, when prices suddenly level off or decline, it also takes multiple years for these market changes to be reflected in property assessments.

2007 assessed values, which were used as a basis for the most recent tax bills, were calculated based on sales that occurred in 2006, 2005 and 2004. Although sale prices began leveling off in 2007, we were not permitted to consider sales that occurred after January 1, 2007. For 2008, assessments will be determined based on sales that occurred in 2007, 2006 and 2005. The number of sales declined sharply in 2007, however, sale prices continued to be relatively stable in 2007. Although sale prices do appear to be declining in 2008, we cannot consider those sale prices until we place the 2009 assessments. Also, the state law does not allow us to consider non-arms-length sale transactions such as foreclosures when determining assessed values.

Although my staff and I are monitoring market conditions closely, please remember that even in the event that the market downturn is sustained long enough to cause assessments to decrease, this does not mean taxes will go down. For taxes to decrease, regardless of whether assessments increase, decrease or remain unchanged, taxing districts, such as cities, villages, school districts, park districts and library districts must reduce spending. If assessments were reduced, but taxing districts continued to increase spending, taxes would also continue to increase.