Dubbed the "Bring Chicago Home" resolution, the Chicago real estate industry has already begun their marketing campaign to fight the plan to raise real estate transfer taxes on high income properties to generate millions for the city's homeless population.
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"This increase will go towards paying for permanent support housing for people that are experiencing homeless," said 35th Ward Alderman Carlos Ramirez Rosa.
The current transfer tax is a flat rate of 0.75% on all property sales in Chicago. The Johnson administration's revised plans increases the rate to 2% for properties above $1 million and 3% for properties $1.5 million andabove, but Ald. Ramirez Rosa, who is a sponsor of the resolution ,said the selling point to voters is that the rate will decrease for all properties under $1 million.
"Ninety-six percent of home sales will see a reduction in the one-time real estate transfer tax that they pay because 96% of sales in the city of Chicago are less than $1 million," he said.
The Johnson administration also plans to frame the resolution as a tax decrease as if the city council sends it to voters. The real estate industry says the tax increase will detract builders from investing in Chicago and will have a negative effect on renters.
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"Landlords own multi-family buildings and they cost north of $1 million," said Tommy Choi of the Illinois Real Estate Association. "That is going to increase the cost that will eventually get passed down to the tenant and increase rent."
The Better Government Association said to look for a well-organized and funded campaign against the tax, similar to the successful fight against the state's graduated income tax.
"This strikes me as a similar situation where you could get an opposition that is well organized, and has a message," said BGA President David Greising.
The Bring Chicago Home resolution has a long way to go before it becomes reality. The Chicago City Council must approve the measure to have it placed on the ballot for residents to decide. It needs more than 50% of the vote to pass.