TAXES

Original Post:  August 25, 2017

Lake Forest is reputed to have reasonable residential property taxes. Its 2016 tax rate, 5.256, is Lake County’s lowest and results in property tax bills around $14,000 for a median market value of $800,000. Zion has the highest rate, 19.966, resulting in tax bills around $6500 for a median market value of $100,000. The median tax rate for Lake County’s 56 municipal districts is 8.961. The modal value is in the 7s (18 out of 56). (Sources: www.lakecountyil.gov and MLS, 2016 detached sales.)

A number of factors contribute to the minimization of a residential tax rate. There may be an economy in Lake Forest having fewer taxing districts than some other communities, allowing for the consolidation of administrative functions and savings in personnel costs and pensions. Lake Forest may be relatively conservative in some expenditures and, e.g., refrain from providing costly public services and venues, such as indoor ice rinks and outdoor aquatic parks. Lake Forest in unusual in Lake County in having eight private schools, serving up to 38% of its K-12 students (2093/5524). Public education is expensive, accounting for 51% of Lake Forest’s tax rate. In Highland Park, where the vast majority of K-12 students receive public education, public education accounts for 66% of its 7.649 tax rate. (Sources: www.lakecountyil.gov; Private School Review, 2003-17; Illinois State Board of Education, 2015-16; and Karen Berkowitz, Highland Park News, 9/8/16.)  Additionally, as the Moraine Township Assessor”s Office, serving Highland Park, is quick to note:  Lake Forest has a substantial commercial-industrial base contributing to its tax coffers.

There may be efficiencies in degrees of centralization, privatization and fiscal conservatism; however, the math of the matter is an inverse relationship between tax rate and the value of a community’s housing stock. The basic formula for computing tax dollars is disarmingly simple: Assessed Value X Tax Rate = Levy, or Requested Tax Dollars. At the community level, tax rate is computed last, Levy and Total Assessed Value are known numbers: Tax Rate = Levy divided by Total Assessed Value. For any given community or levy, the more valuable the housing stock, the lower the tax rate. Lake Forest has the lowest tax rate among Lake County communities largely, though not solely, because its housing stock has the highest total assessed value, 2.441 billion (Lake County Town Sheets, 2016). By the time individual tax bills are computed, a property’s assessed value and applicable tax rate have been set. Assessed Value, the progressive component in the computation of taxes, representing an owner’s fair share of the tax burden, is multiplied times Tax Rate to determine a tax payer’s contribution to the cost of public service