Illinois (ECWd) –
Property Tax Extension Limitation Law (PTELL)
Tax laws in Illinois are probably the most complicated of all 50 states. The one forgotten factor, however, is the voters have a say. As it relates to PTELL, it came about because the voters voted in favor of it.
Once in place, we see public bodies maxing out their tax levy while they cry wolf about how PTELL has taken the regulation of the tax rate out of their hands. What I find interesting with such an argument is the fact it ignores who is in charge, the voter.
In spite of out of control spending by local public bodies, it’s that time of year again, where one side wants to keep taxes high and the other wants to reduce them, and PTELL becomes the boogeyman and I suspect neither side has a real grasp of what the rules are for PTELL and why it actually is a voter-friendly law.
We see some public bodies crying wolf on one hand, that the only way to remain solvent is to tax at the maximum rate possible, blaming PTELL, while their other hand, is out drawing salaries and benefits well beyond the norm found in the private sector. One township we have reported on in the past pays their board members $4,500 a year for 12 meetings, which take about 15 minutes to conduct, illegally transfers Public Aid money for other use, then gives money away to groups of their choosing, all while crying about PTELL.
- PTELL is a “Tax CAP” – According to Illinois Department of Revenue, “use of this phrase can be misleading”. “PTELL allows a taxing district to receive a limited inflationary increase in tax extensions on existing property, plus an additional amount for new construction.”
- PTELL Caps individual property tax bills and assessments – According to the Illinois Department of Revenue, “The PTELL does not “cap” either individual property tax bills or individual property assessments. Instead, the PTELL allows a taxing district to receive a limited inflationary increase in tax extensions on existing property, plus an additional amount for new construction.
- If we lower taxes we won’t be able to deal with an emergency because we can’t raise taxes beyond PTELL – According to the Illinois Department of Revenue, If a taxing district determines that it needs more money than is allowed by the limitation, it can ask the voters to approve an increase.
- PTELL tied our hands and we need to get rid of it. – I love that one because those making such a claim, more often than not, have never lifted a finger to move towards a referendum to get it removed. During elections they claim they need your vote and help to get rid of PTELL, thus PTELL is being used as the Boogeyman while the truth is they have no interest in doing more than ensuring their bloated salaries and benefits continue.
- If you lower taxes we won’t be able to provide services. That myth comes from the same people that say they have to have your taxes maxed out to stay solvent, all while wanting your help to remove PTELL. And at the same time they’re presenting those lies, they are making massive fund transfers every year claiming an excess and even take Public Aid money and use it for other purposes. Who’s on first?
The fact of the matter, PTELL is a voter based system that is put in place by We The People and can be modified and or removed by We The People. What a novel idea in Illinois. A law that actually puts the control in the hands of the voters and not the elected officials who more often than not, have never read the laws they are under.
Under PTELL, you can, in fact, have an increase beyond the PTELL. Those areas are listed in the PTELL document below.
- new construction
- annexations to the district
- voter-approved increases in the extension limit or limitation for one or more levy years
- voter-approved increases in tax rates and voter-approved new tax rates for one or more levy years
- the Tax Increment Financing district (TIF) increment when the TIF expires.
When newly elected figures take their seat and decide to lower taxes, you should expect them to look into all the factors in making such a determination. For example, what type of fund balances are on hand? What are the actual expenses each year or a five-year average? What is the anticipated future of the Consumer Price Index? If those factors support reducing taxes, then why on earth would you not reduce them?
All of those factors should be considered and in many cases, we find PTELL is not the problem. In fact, PTELL, put in place by We The People, is the very safety net that prevents elected official from taxing at what every rate they want to. Without PTELL, local public officials could have a simple truth in taxation hearing, hear you moan and grown, then increase them to the figure they want and there is nothing the public could do about it.
So if you have elected officials supporting the removal of PTELL and using its restrictions on tax increases as the boogeyman, please read the IDR PTELL document to better understand the truth as it relates to your property taxes.
PTELL is a voter based law that was designed to benefit the taxpayer. IDR says it best: “As a whole, property owners have some protection from tax bills that increase only because the market value of their property is rising rapidly.”
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