Class 7A And 7B Tax Incentives Are Now Renewable In Cook County

The L&T Blog Team • May 25, 2017

New Class 7 Tax Amendments Permit Renewal of Incentives in Cook County By Brian Liston “You will never face a tax problem that’s not charged with opportunity.” – Warren Buffett In the past few years, myself along with prominent local Mayors, Economic Development Municipal leaders and developers have formed a … Continued The post Class 7A And 7B Tax Incentives Are Now Renewable In Cook County appeared first on Liston Tsantilis Law.

New Class 7 Tax Amendments Permit Renewal of Incentives in Cook County
By Brian Liston

“You will never face a tax problem that’s not charged with opportunity.” – Warren Buffett

In the past few years, myself along with prominent local Mayors, Economic Development Municipal leaders and developers have formed a taskforce to advise Cook County on amendments to the current Cook County Tax incentive ordinances. Along with addressing the rising vacancy levels in Cook County Industrial properties, Cook County wanted to enhance its commercial incentive program to attract high quality investments in areas in desperate need of rejuvenation of decaying properties. Thanks to our hard work and feedback from the Cook County Planning and Development department, the Board of Commissioners (the “County Board”) passed an amendment to the Cook County ordinance that now allows the renewal of the Class 7 incentives in April of 2017.

This Class 7 amendment brings with it several new and exciting changes to the Class 7 incentives program. One of the more significant changes is that it will allow the renewal of Class 7 commercial incentives for the first time in Cook County history.

Class 7: The Commercial Tax Incentive

The County Board originally instituted the Class 7 Tax Incentive to encourage development of Commercial properties. Cook County defines such properties as “Any real estate used primarily for buying and selling of goods and services, or for otherwise providing goods and services, including any real estate used for hotel and motel purposes.” This includes without limitation: retail, service, self-storage, office properties and mixed office/industrial properties that do not otherwise qualify for a Class 7 incentive.

This Class 7 incentive is designed to last twelve years, generally lowering property taxes by nearly 60% for the first ten years of the incentive, 40% for the 11th year and 20% for the 12th year. To obtain the incentive a project must obtain municipal support, typically in the form of a resolution and the project must seek to start new construction or occupy an abandoned property. To qualify for the abandoned property category, the property must have been vacant for twenty four months or longer unless determined by the County Board that a waiver of this requirement is warranted (sometimes referred to as “Special Circumstances”). Such a waiver would permit an incentive application to proceed with less than 24 months vacancy, but the precise amount of vacancy needed varies depending on the specific circumstances of the project.

While this requirement is very similar to the Class 6 and 8 incentives Cook County uses to encourage industrial development in blighted areas, the Class 7 Incentives add a further eligibility test. All Class 7 Tax Incentives must satisfy five eligibility requirements:

Designation of a blighted area by the local Municipality
Proof that real estate taxes in a target area have declined in the last six years
Proof that the project is viable, both in scope and timeliness
Proof that without the incentive, the project would not be financially viable
Proof that the project is expected to ultimately result in an increase in real property tax revenue and jobs

Finally, the Class 7 Tax Incentive is generally divided into two classes, A & B. The key difference between the two versions of incentives is the level of investment required by the developing party. If an entity invests less than $2,000,000, it qualifies as a Class 7A, if more, it is a Class 7B. Beyond the monetary distinction, Municipalities and the County tend to “liberally construe” the above five eligibility requirements for smaller projects under the 7A program as they are smaller projects.

The County has also created a third program, 7C or “CURE,” which is a short term version of the commercial incentive, only lasting five years. The qualification requirements are similar to its “older” siblings, the class 7A and 7B, but as it is a shorter program, CURE is meant for smaller projects and has lower thresholds for qualification. Incentives under the CURE program remain non-renewable.
Recent examples of successful Class 7bs include Weichai Motors America (Rolling Meadows), Lifting Gear Hire (Bridgeview) and Evanston Volvo. Many large scale office projects are also included in the Class 7 incentives, and have seen solid success in certain areas of Cook County.

Commercial Incentives are Now Renewable

Historically, the Class 7 Commercial Tax Incentives were not renewable as the County originally did not include the option in the creating ordinance. However, similar incentives granted to industrial and properties in desperate need for support, the Class 6 and 8 incentives, have historically enjoyed the ability to be renewed. The recognition that these incentives may need to be renewed at times was based on Cook County’s historically high vacancy rates relative to surrounding areas. Further, the County recognized early on that Cook County property tax rates may result in higher tax bills than the collar counties around Cook, and that businesses may also look to Wisconsin and Indiana for competitive options. This renewal option resets the clock and gives municipalities options to retain and attract key commercial operations.

While the Class 7renewal requirements are still being fine-tuned, the general idea of renewal would be that a municipality would simply need to provide a resolution of support for the renewal to the County and the County would then be able to renew the Class 7 incentive for another twelve years. Similar to the Class 6 renewal timeline, renewals of the incentive would not be allowed until the tenth year of the current incentive. Not only will the ability to renew in this way add significant value, but the likely procedure to renew the incentives will be substantially more cost effective as most municipalities would be intimately familiar with the commercial operation in its community for the past year.

With the new amended ordinance going into effect on May 1, 2017, the County has given municipalities in Cook County a major new incentive tool to use in their economic development portfolio to allow municipalities to remain competitive in the commercial marketplace for emerging businesses. This option to renew the incentive will also improve stabilization of taxes, predictability of the process and attract a much higher level of investment in commercial properties in Chicagoland.

Brian P. Liston, M.B.A., J.D. is president of Liston & Tsantilis in Chicago where he specializes in the area of eminent domain and property tax litigation. He has successfully tried numerous jury and bench property tax appeal hearings throughout the State of Illinois brining successful resolutions to his clients. Liston has been on the team of 26 National Association for Industrial and Office Properties awards given for his legal work on incentives and land use projects throughout the Midwest. Recently his law firm was ranked #1 by the Leading Lawyers Network in the State of Illinois by his colleagues in the legal field for land use for the fifth year in a row.

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How A Chicago-Based Law Firm Has Shaped A Major Industrial Tax Incentive

April 9, 2025

Source: BISNOW | Repost Liston & Tsantilis 4/9/2025 - With tax season in full swing, the commercial real estate industry is focused on how to get the most out of any tax incentives available. In Cook County, Illinois, this includes the Class 6b incentive , which was created to encourage the development of new industrial facilities, the rehabilitation of existing industrial structures and the industrial reutilization of abandoned buildings. Properties that qualify for this incentive will be assessed at 10% of market value for the first 10 years, 15% in the 11th year and 20% in the 12th year, resulting in significant tax savings. Qualifying properties can receive a reduced assessment from the date that new construction or substantial rehabilitation is completed and initially assessed or, in the case of abandoned property, from the date when it is occupied by new tenants. According to the 6b eligibility bulletin published by the Cook County assessor, the goal of this incentive is “to attract new industry, stimulate expansion and retention of existing industry and increase employment opportunities.” Brian Liston and Peter Tsantilis of the Chicago-based law firm Liston & Tsantilis have a personal history with this incentive. Four decades ago, while working in the Illinois Attorney General’s Office, Liston helped draft several key property tax incentives with Cook County President George Dunne, including 6b. Years later, Liston and Tsantilis were instrumental in drafting the legislation that allowed industrial owners to renew this incentive. Tsantilis, reflecting on the changes that have been made to the incentive since its inception, explained that initially, a building needed to be vacant for two years to qualify. That term was then shortened to less than two years, then less than one year under the special circumstances arm of the incentive — if there is a transfer of title. Otherwise, with no transfer of title, there must be at least one year of vacancy. “Several different variations have been developed over the years based on the needs of property owners and tenants,” Tsantilis said. Read the full article...

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We are excited to announce a new chapter for Liston & Tsantilis ! Thanks to your continued support and the growth we’ve achieved together, we are expanding into a new, larger space that will enable us to ensure the best possible technological advances in our industry. As of November 1, 2024, our new office will be located at: 200 S. Wacker Drive Suite 820 Chicago, Illinois 60606 This move reflects our continued commitment to excellence by creating a space that accommodates the ever evolving and increasing technological demands necessary to lead the new frontier of land use and valuation services. If you have any questions or need more information, feel free to contact us. Thank you for being an essential part of our journey! Warm regards, Brian, Peter & the Team at Liston & Tsantilis

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We are thrilled to share some exciting news with you! Thanks to your continued support and our collective success, we are embarking on a significant new chapter at Liston & Tsantilis . Due to our sustained growth, we are expanding into a new, larger space that will allow us to better serve you as we continue our journey. Our new location will be at 200 S. Wacker, a move that reflects our commitment to providing the highest quality of service and technology in order to accommodate the evolving needs of our clients and partners. This expansion is more than just a change of address; it is a testament to the strong relationships we have built with you and the bright future we envision. As you can see, construction is about to begin and we are planning to transition to the new space upon its completion. We will keep you updated on our progress and any relevant details as the project advances. Rest assured, throughout this process, our focus remains on maintaining and exceeding the excellent level of service you have come to expect from us. Thank you for being an integral part of our journey. We look forward to welcoming you to our new location and continuing our successful partnership. Should you have any questions or need further information, please feel free to reach out. Warm regards, Brian & Peter

2023 Cook County Final Multiplier Announced

May 21, 2024

Source: Illinois Revenue | Repost Kistin Tsantilis 5/21/2024 - A final 2023 property tax equalization factor of 3.0163 for Cook County was just announced by the Illinois Department of Revenue. The Department is required by law to calculate the factor, often called the multiplier, to achieve uniform property assessment throughout the state. The Department determines the equalization factor for each county by comparing a three-year period the actual selling price of individual properties to the assessed value placed on those properties by the county assessor. If the median level of assessment for all property in the county varies from the 33 1/3 percent level required by law, an equalization factor is assigned to bring assessments to the legally mandated level. The three-year average level of assessments (weighted by class) for Cook County property is 11.05 percent. The Department calculated the multiplier to bring the average level of assessments to the required 33 1/3 percent level by dividing Cook County's three-year average of 11.05 into 33.33. After taking into account the reassessments, the levels of assessment are as follows: After taking into account the 2023 reassessments, the levels of assessment are as follows: Class Average 2020 2021 2022 3-Year 1 (Vacant Lots) 7.57% 7.88% 6.76% 7.40% 2 (Residential) 9.86% 9.05% 8.16% 9.02% 3 (Apartments) 8.41% 7.21% 6.59% 7.40% 5a (Commercial) 24.53% 23.54% 20.59% 22.89% 5b (Industrial) 26.14% 24.59% 19.05% 23.26% COUNTYWIDE 12.08% 11.12% 9.94% 11.05% (weighted average) The equalization factor does not cause individual tax bills to go up. Tax bills are determined by local taxing bodies when they request the dollars needed to provide services to citizens. The assessment process simply determines how the bill will be divided among taxpayers. A Cook County ordinance requires that residential property (homes, condominiums, apartment buildings of six units or less) be assessed at 10 percent of market value; all other residential property (apartments with more than six units), 10 percent; vacant lots, 10 percent; property owned by not-for-profit corporations, 25 percent; commercial property, 25 percent; industrial property, 25 percent; and commercial or industrial property being developed in economically deprived areas, usually 10 percent. Official Announcement:

Property Tax Experts Break Down Revisions To Cook County Tax Incentives

April 1, 2024

Navigating the evolving landscape of property tax incentives in Cook County, Illinois has become an increasingly complex task for business leaders aiming to optimize their real estate investments. Liston & Tsantilis has been at the forefront of property tax incentives for industrial and commercial properties for the last 40 years. In this article, we offer the recent incentives updates and insights into the significant changes that have recently unfolded in the realm of commercial and industrial property incentives. Understanding their implications is essential as real professionals move their businesses forward against the never-ending changes taking place. Brian & Peter Source: Bisnow | Reposted Liston & Tsantillis 4/1/2024 - Nearly four decades ago, attorney Brian Liston worked as an assistant at the Illinois Attorney General’s office, playing a key role in drafting Cook County incentives ordinances to boost the local economy and attract new businesses. “I worked in a team alongside the Cook County Assessor Thomas Tully and Cook County President George Dunne to implement tax incentives to compete with the surrounding counties’ to lower assessment classifications, instill economic development and create jobs,” Liston said. “As Jerry Garcia of the Grateful Dead would say, ‘It’s been a long, strange trip.’” Today, Liston is a partner alongside Peter Tsantilis at the Chicago-based Liston & Tsantilis, a law firm that specializes in eminent domain litigation, property tax litigation and incentives for industrial and commercial properties. His law firm has consistently been ranked No. 1 for the past 19 years by the Leading Lawyers Network . In the decades since Liston helped shape those incentives, a lot has changed. And those changes seemed to speed up significantly in the last few years amid the changing real estate landscape. “There have been significant changes in the last 36 months that we need to update the real estate community on to ensure they have all the necessary and accurate information they need to make informed decisions when it comes to incentives,” he said. Liston and Tsantilis walked Bisnow through the major changes of the last four years and what they mean for the commercial and industrial real estate communities. Read the full article...

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While Cook County has not yet mailed 2022 Second Installment tax bills, they have issued the 2022 tax rates used to calculate final tax bills. The 2022 Second Installment Tax Bill amounts for your property can be found below: https://www.cookcountytreasurer.com/yourpropertytaxoverviewresults.aspx

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2022 Cook County Final Multiplier Announced

September 6, 2023

Source: Illinois Revenue | Repost Liston & Tsantilis 9/6/2023 - A final 2022 property tax equalization factor of 2.9237 for Cook County was announced today by the Illinois Department of Revenue. The Department is required by law to calculate the factor, often called the multiplier, to achieve uniform property assessment throughout the state. The 2022 Final equalization factor increased from the 2022 tentative factor of 2.7230.The department determines the equalization factor for each county by comparing over a three-year period the actual selling price of individual properties to the assessed value placed on those properties by the county assessor. If the median level of assessment for all property in the county varies from the 33 1/3 percent level required by law, an equalization factor is assigned to bring assessments to the legally mandated level. The three-year average level of assessments (weighted by class) for Cook County property is 11.40 percent. The department calculated the multiplier to bring the average level of assessments to the required 33 1/3 percent level by dividing Cook County's three-year average of 11.40 into 33.33. After taking into account the 2022 reassessments, the levels of assessment are as follows: 3-Year Class 2019 2020 2021 Average 1 (Vacant Lots) 9.38 7.34 7.65 8.12 2 (Residential) 9.52 9.37 8.60 9.16 3 (Apartments) 7.24 8.65 7.42 7.77 5a (Commercial) 22.76 24.79 23.78 23.78 5b (Industrial) 27.27 25.38 23.88 25.51 COUNTYWIDE 11.64 11.74 10.81 11.40 (weighted average) The equalization factor does not cause individual tax bills to go up. Tax bills are determined by local taxing bodies when they request the dollars needed to provide services to citizens. The assessment process simply determines how the bill will be divided among taxpayers. A Cook County ordinance requires that residential property (homes, condominiums, apartment buildings of six units or less) be assessed at 10 percent of market value; all other residential property (apartments with more than six units), 10 percent; vacant lots, 10 percent; property owned by not-for-profit corporations, 25 percent; commercial property, 25 percent; industrial property, 25 percent; and commercial or industrial property being developed in economically deprived areas, usually 10 percent. Official Announcement:

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On Wednesday, July 19th, Cook County Board President Toni Preckwinkle announced that the second installment of the property tax bills for the 2022 tax year should be ready by November 1st and due December 1st. The article below from the Chicago Tribune has the details of the announcement. We will continue to monitor the situation and provide updates as we are made aware of them. Brian & Peter Source: Chicago Tribune | Repost Liston & Tsantilis 7/20/2023 - Property tax bills owed by Cook County residents and business owners are once again landing in mailboxes months later than usual. Cook County Board President Toni Preckwinkle announced Wednesday that second installment property tax bills for the 2022 tax year are expected to be ready Nov. 1 and due Dec. 1. It’s an improvement compared to last year’s delay: Bills were not ready until late November and were due by Dec. 31. The year before, second installment bills were due two months later than usual. For most of the previous decade, second installment bills have usually been mailed in July and due by Aug. 1. But technological issues between Assessor Fritz Kaegi’s office and the three-member Board of Review, which hears assessment appeals, proliferated during the COVID-19 pandemic, leading to a monthslong delay and weeks of finger-pointing between Kaegi and BOR Commissioner Larry Rogers Jr. Read the full article...

ISBA Law - State and Local Tax Review

January 11, 2023

Live Webcast Wednesday, January 25, 2023 CLE – 9:00 a.m. – 1:00 p.m. Virtual Networking – 1:00 – 1:15 p.m. 3.75 hours MCLE credit Whether it’s the State, Cook County, or the City of Chicago – our elected officials decide how taxes are collected, how they are distributed, how (and who) they help, and how to achieve equitable burden and distribution while ensuring the maximum collection and compliance. Join us for an in-depth look at how the laws and ordinances in our tax system operate, as well as how they impact you and your clients. Brian Liston will presenting on Tax Incentives Today as part of the overall event. Topics include: Valuation issues for condominium/townhouse association assessments, as well as the pitfalls, remedies, and existing laws to be aware of; What to expect from Illinois legislative as we enter the Spring 2023 session; An introduction to the Cook County property tax system; and What has changed (and stayed the same) with property tax incentives. Here is the flyer with the complete schedule for the event!