Thursday, February 7, 2008
* Mayor Daley Loses It
Hey Joe Moore, while your constituents are getting all worked up over the magic voting pen, where was your backbone to stand up against the mayor on yesterday's Real Estate transfer tax increase? Were you afraid of the wrath you'd get from the mayor? You fucking coward. Some new progressive caucus council member you turned out to be.
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25 comments:
I've long been a staunch supporter of Daley, but his inability to balance a budget without sticking it to Chicagoans is rapidly changing my opinion.
He's become too expensive for my taste.
STILL DALEY RUNS A BETTER GOVERMENT THAT COOK COUNTY BOARD-
I too would have been a coward.
Daley only seemed a step away from pulling out a bat and pulling an al capone on the first person to vote no.
;)
The real estate tax is A O Ok with me. People are coming into this city and shooting property values up 300%. And guess what, the most rapidly gentrifying neighborhoods are clustered around public transit hubs. And people that need it the most are losing easy access to it. Condo buyers can fund an increase in transit funding and hopefully with the windfall they will expand it to better serve our UNDERSERVED low income neighborhoods and those can see a benefit from gentrification of the city as well instead of displacement to a jobless transitless waste land.
and what would you wise guys cut? don't tell me waste, go to the budget and point to the line items. you balance it.
and btw, anyone who can't get the video, it doesn't actually have anything to do with joe.
The CAPS program. The Olympic bid. Stop paying out double and triple pensions to a single person. The entire Chicago Special Events office. The Mayor's rotating downtown banner program. Cary Steinbuck. That lying chick sitting next to the mayor in the video.
That's without viewing the budget. How's for starters.
THINK OUR ALDERMAN DID THE RIGHT THING - STAYING QUIET ON THIS ISSUE
THE UNION PROBABLY TOLD HIM TO LAY LOW-
Paradise, you may not have noticed, but real estate values are rolling back rapidly.
The real estate transfer tax works a hardship on non-affluent buyers, and seems to me to have been designed specifically to peeve the population, and to direct their ire to the CTA.
Daley could have diverted money from his monument-building projects and TIFs to fund a necessary service.
Daley flatly doesn't care about transit, which is really baffling considering his stated desire to make Chicago the "greenest" city in the country.
He must mean "green" as in campaign contributions from his rich cronies.
North Coast, that's remarkably conceptualized. I would argue that having busses out in traffic in the first place generates ire for the CTA, but there's ire daily at the CTA for mismanagement anyway, people still want more busses.
It's not like I don't aggree about TIFs or that I haven't felt the same sarcasm about Daley and his greenest city. I did find out that the Bean was paid for by mostly private donations though. You know, to see if the cost of it was enough money to bail out the CTA, that's what I read, I'll recheck that.
Still, there aren't any low income condo buyers. There's not retail and service workers buying condos, they might sell a couple for $150,000 to teachers and cops, but I guess they're going to have to lower the prices another couple grand now, oh well. I see it hurting the sellers, and considering the astronomical appreciation of recent years, I don't believe people will be screaming out of hardship. They'll scream, though. We'll se what happens, they just had a revolt in Indiana over property taxes. Nobody says a home shouldn't be costing over a million dollars, they say they shouldn't have to pay higher taxes on it.
Craig,
You are lucky to have the alderman that you have. Voting to shut down the CTA would be really stupid, especially in the 49th ward where most residdents enjoy subsidized public transportation paid for by the rest of the six county area. You are also lucky that Joe is used to your crap and is tolerant of it. If you called me those names I'd come down there and kick your ass.
Come on and give it a try big mouth Bill.
Just as I thought, Bill's full of shit and as cowardly as Joe. That calls for banishment.
Where to cut Been There?The city/county/state budgets are eaten up by HUGE labor costs. 60% to 80% of their budgets are labor costs. They offer salaries, pensions and benefits not available in the private sector. The entire transfer tax is going to pay CTA pensions and has nothing to do with making transit better. The state of Illinois has between $40 and $50 billion in unfunded state pension liabilities [we lead the nation by a long shot] guaranteed by you, the taxpayer... these are the only pensions in the state guaranteed by law. Ask the Steelworkers and United employess about their pension guarantees? I'd be much more supportive if our Pols called for an accross the board pay CUT of 10/15% for all public employees. Folks, our politicians have been very generous to themselves - anyone who thinks that labor costs can't be cut in Illinois is fooling themselves. Sadly, I fear that the worst is yet to come with regards to our taxes.
its not the real estate tax, stupid its the property transfer tax, its for new home buyers
and anyone who thinks that home owners should be "punished" for higher real estate tax is a fool to say something and is selfish, self absorbed, and really jealous cause they don't own.
"people are coming into this city and shooting property values up 300%." huh? Queen paradise has spoken only she can move into this City only she and her RPark liberals can deem who is a valued person to come to Chicago. And how the hell do you know that prices are going up 300%, please give me 10 addresses in RP and 1 address from every neighborhood to prove this "fact."
Last time I looked it was many cultures and many income types buying and they clearly all don't live by mass transit. Rogers park is not the center of Chicago.
The transfer tax is being raised 40% so instead of paying $7.50 per $1,000 the buyer of every income has to pay $10.00 per $1,000 and who will get hurt the most the lower income folks who just want to buy a place for their family and their dream. But Queen Paradise doens't care she is the provider of the "UNDERSERVED" low income, yet she wants to hurt them when they purchase.
I'm confused. I thought the hike in sales tax was the answer for the CTA. Now we're ALSO going to penalize people purchasing new homes? I obviously missed something here. Sorry to be so ignorant but can someone give me brief history lesson here? Where did that sales tax go and if it didn't go anywhere, then why isn't it enough to cover the CTA? Oh, yea, and while we're at it - does anyone have an update on that boondoggle of an idea to build an express line from State Street directly out to O'Hare? Hopefully that monster has been laide to rest . . . or has it?
THANKS!
The real estate taxes I was referring to in Indiana, were adjusted for appreciation. The 300%inflation in property prices has happened in just about every gentrifying neighborhood in Chicago. For instance, I looked at some one bedrooms at Columbia and Greenview that had sold for $40,000 and were being offered for over $100,000 a couple years later so maybe you are the stupid one if you don't know how inexpensive property used to be in the city, in fact I had some friends who bought a HOUSE for $60,000 15 years ago and sold it for almost half a million.
Well I don't see wages going up with it. And I am going to look out for things. I'd rather see the enormous inflation in real estate prices go in part to funding infrastructure rather than lining the pockets of the speculators. I don't see it harming low income buyers, because I see it coming out of the price they can get for a property. Not that I see many of my friends able to buy even the "affordable" set asides. If I did see it harming low income people I'd scream too.
I'm not jealous because I live in a co op. That's really the way to go for low income people. There's no real estate transfer tax at all because its not real estate and not set up for speculation. It's set up for people to have an affordable stable roof over their head. When i leave, I'll get back what I invested and some appreciation comparable to a natural inflation. And by the way, co ops aren't funded by any government assitance, so there. It just avoids profiteering. How about that.
Of course co ops aren't the norm but might solve our low income housing problem to the extent that we can find a sustainable development scenario to expand their existence. I do feel like a queen, however, residing in my beautiful, spacious, (not chopped up little box)affordable palace.
This real esatate rat race, that's what's harming low income people. Solid working class people are being pushed aside, how pathetic is it that we need to have affordable set asides for our teachers and policemen.
Don't you come screaming at me. I'm very concerned about affordibility and the American Dream. The real estate inflation is harming, not the .35 % in transfer taxes. If that can bring money to improve neglected infrastructure, I see a benefit. I have high hopes for the CTA. I could talk about it. They need to take the cash infusion and expand to the point where it is more profitable. They need a business plan, I'd like to talk about that.
Another commenter pointed out that we should start cutting pensions and jobs. Look buddy, if a person works hard they should have a pension. I don't care if alot of businesses are wiping out benefits and cutting jobs. These people tout how important they are to society because they bring jobs and then jobs are the first thing they want to dispose of. I've been thinking about this for a long time, I want to talk about it and I will, but let me tell you, good government jobs are the standard we should all measure up to. We should be leading the way and setting a good example in the public sector, not following the lead of the worst examples. Cut jobs, less people spending money, cut pensions old folks eating dog food or more welfare required. How about asking how we can grow the CTA. Are we going to cave in and start cutting people off, or are we going to push and expand. Why can't we do that?
Not sure if anyone posted this, but the transfer tax is paid by the seller, so it has no bearing on home buying in Cook County. The burden is put on the seller. It makes no difference as to the income of the buyer, or the unit the buyer is purchasing (except for the transfer tax, which is a function of the price). So, I can't imagine this tax dissuading anyone from buying--in that they are not affected at all. Closing costs, sure, but the transfer tax, that doesn't make sense.
Perhaps it will stop the flood of "flipping" housing, which leads to more transient neighborhoods... maybe a good thing, not sure.
I retract part of the last statement--in this buyer's market, the transfer tax is often paid by the seller (and the portion of it that's paid varies by region) as part of the negotiation.
Mary in chicago buyers and sellers pay transfer tax the sellers = $1.50 per $1,000 and now buyers $10.00 per thousand.
Paradise: This is out of the pocket money and it was unfairly not disclosed to the public and "bleeding heart liberals" like yourself, who think anyone else should have higher property tax except yourself are pious and selfish. So everyone knows co-ops taxes are only a couple hundred dollars a years not thousands like myself and other working class slobs.
Paradise you spoke of a 300% rise and it was based on Indiana stats, gee good thing I questioned your Chicago based statements.
I grew up on the North side not Indiana and of course in 15 years property will go up that is how the world works, would you deny those working class folks a nice retirement? Even in Indiana prices were lower 15 years ago. How can you even think of comparing anything to 15 years ago?
BTW Houses are affordable in other parts of Chicago, I have many friends who have bought single family homes for $250K in the past current years. Edgewater is very affordable for condos.
WTG Joe, for once I support you for standing up to the mayor.
I wish you could just keep track of what I said. I only referred to Indiana as a startling example of people revolting against taxes. I probably shouldn't have even mentioned it, but in the case that people wanted to talk about it in the same vein, what to do about people that enjoy astronomical apreciation of their real estate values, but don't want to pay the corresponding higher taxes, I had some solutions. It doesn't matter.
The examples I gave were from Chicago, though, HELLO, Greenview and Columbia. No, no, no, $250,000 for a house is not affordable. I found two in RP around that price. The bills on those would be around $2,000 a month so a family would have to be earning at least $60,000a year to afford it, but lenders want to see $80,000 for a traditional mortgage, which means they'd have to find a creative one which is drying up after the crash of the sub prime market. If it was a two income household, it would be two salaried individuals, I can't think of any wage more than $30 per hour, so the American Dream is not for wage earners. That's nothing new, but its exactly that $250,000 home we are in danger of losing to gentrification and real estate speculation.
On one hand, the transfer tax increase on that property is an extra one time charge of $750, nothing to scream about given the amenties of living in the city. On the other hand, what the owners calculate they can afford would be drastically reduced by further appreciation of the property in the next five years where it could easily rise 100% to $500,000 compared to what we've seen in other areas, resulting in $200-300 a month more in taxes. And that has nothing to do with raising taxes. That's where I think we need to look at creative solutions.
But anything to slow the market benefits current residents and future home buyers. The only exceptions are sellers and people who want to cash out with a refinance. People want that, I thought well, you could defer the part of property taxes due to appreciation toward the cashing out of the value or some such thing, but if we just had a natural appreciation closer to inflation, no problem. People looking at housing as a speculative investment rather than as stability and security that is our undoing. Maybe, that's my opinion, maybe 90% of property buyers want a maximum return and welcome rapid appreciation. In that case, they can pay the taxes on it. That has nothing to do with me, because I chose to invest in security by living in a co op. It has nothing to do with the transfer tax either. The CTA is an amenity for everyone, regardless of whether they use it or not. For drivers, it eases parking and congestion, for riders it offers an affordable alternative.
Paradise, I agree that CTA is an amenity for everyone, and I could say further that it is crucial to this city's liveability in the present, and its viability as a city.
However, I beg to differ from you on the propriety of using a transfer tax on real estate sales to support the system.
I believe that massive cuts could be made in many non-essential public expenditures, and the savings directed to public transit,with a large set-aside for street improvements and replacing our dangerously decrepit water and sewer infrastructurue.
We have, at present, at least 180 TIF districts. These are a massive drain on the public till,in that they are a huge diversion of present and future taxes to private entities. We're talking many hundreds of millions of dollars being diverted to private entities that sometimes, like Loyola, will never pay a dime in taxes.
Additionally, we are spending ungodly sums of public money on Da Mare's vanity projects, like the insane el superstation on Block 37 and the lunatic bid for the Olympics. The Block 37 money is done for, unfortunately, but we can still stop the Olympics.
Whatever, please leave the property taxes alone. Thousands of elders are being forced to sell their houses because the places are appraised at Bubble values. Even though house prices in this city are now dropping rapidly, there is no rollback in taxes. The taxes on investment properties are even more oppressive, and are driving rents northward.
People who own little $250K houses are usually wage earners who bought them with little down and combined incomes. Thanks to the insane runup in real estate prices combined with lunatic financing, these people are often paying out half their gross incomes for their housing. How much more can they take? While I have little sympathy for people who bought what they knew damn well they couldn't afford, I have endless sympathy for anyone who bought a house they thought they could pay for, had every reason to think that they could afford, and find themselves confronted with unaffordable taxes on same.
Consider that many sales now are distress sales made by people who just can't afford their places anymore, and you can see the hardship this tax works.
The real estate transfer tax has nothing to do with rising property taxes. Rising property taxes are a direct function of appreciation. People that can't afford the higher taxes are suffering from the real estate bubble raising property VALUES through the roof. Real estate taxes are going up because property values are. So defering the taxes toward cashing out of the value makes sense. That keeps people in their homes. Looking at the value of the home at the time of purchase, so if a person wants to come in and pay a million and a half for a Mc Mansion or $250,000 for a cookie cutter condo, they can start paying the taxes right away. Someone that bought 15 years ago can defer the taxes till they cash out the appreciation or something like that. What do you suggest. I mean really, to fix our crumbling infrastructure is BILLIONS. Let's look up the cost of a new sewer system for Chicago. I'm not even arguing for TIFs. Just tell me if people should have to pay the same property tax rate already in place for the rising property values. Should the yuppies pay the same as the old folks? Its the opposite, the old folks are having to pay the same as the yuppies and that's why property taxes are going up. Are you talking about LOWERING taxes in the face of rising property values instead of keeping te same rate. Because then the yuppies can afford to pay even more for the new condos. Then we can start paying 500,000 for a two bedroom and nothing for infrastructure. Then we can all fall into the sewer.
Vanessa, the affluent "yuppie" buyer will not feel any pain from the property transfer tax when s/he is ready to step to the plate and buy a distressed $600K foreclosure for $259K. (There is really such a downtown highrise on the market, foreclosed after purchase for $600K, now on the market for $259K, see it at the blog http://cribchatter.com).
However, the buyer with a moderate income who springs the modest $110K condo in these parts will surely feel the pain of $10 per $1000 in purchase price. That means another $1100 worth of closing costs to someone like me- a real blow, after fighting to accumulate a modest downstroke and closing costs.
It is the buyer with the modest salary who will suffer, and that $1100 or $1200 will make the diff between buying now that the prices are really giving back , and having to defer the purchase for a few more months.
So this transfer tax is yet another regressive tax, which means it hits unaffluent buyers and sellers much harder than the affluent. Another $4000 is not a hardship for someone making $150K, but another $1100 is sure as hell a hardship for someone like me, and it's even worse for the distressed seller who, say , bought some overpriced dump in 2005 and is now having to sell into a steep down market, because he was laid off or can no longer afford the property taxes. For many distressed sellers, it means a bigger deficiency judgement against them, as they either sell to avoid foreclosure or see their property sold at auction for a fire sale price. I don't believe in bailing foolish buyers out of their stupidity, but we don't need to pile on more misery in the form of a brutal property transfer tax, either.
There should have been no need for this tax, and there should also be no need to raise property taxes, were it not for the massive misallocation of tax monies to Hizzoner's monument building, and the diversion of hundreds of millions of dollars to corporate interests via tax abatements and TIF districts.
So it appears to me that this tax is one more hand grenade lobbed at the unaffluent in the ongoing class war between moderate-to-middle home buyers and sellers who will suffer greatly from it; and affluent buyers and sellers for whom it is a token cost that won't slow them down one bit as they dive in to take advantage of all the bargains we will be seeing in coming months in houses and condos in this declining market.
On a $110,000 walk-in-closet the property transfer tax increase amounts to $310, the raise is three dollars. That's one time. The property tax increases, something different, are based on reassements of the value, are ongoing and are what's causing hardship and the revolt. I would love to talk about that, so now its all mixed up together here.
Anyway, the real estate transfer tax increase is not a hardship, or brutal. It's just simply a tax increase and you always complain. Most taxes except income taxes are regressive in that they affect the less wealthy by a greater percentage of their money, but only if wealthy people spend a smaller percentage of their wealth. Some wealthy people live paycheck to paycheck too.
You know, if you want to tax the luxury places at a higher rate and not tax the low to moderate income ones at all with the real estate transfer tax increase, that would be ideal. But the city has an endless amount of infrastructure that is neglected and the CTA is at the top of the list. People who will directly benefit from this amenity are footing a small part of the bill. Whether its pensions or not, it takes one more financial liability off the CTA and enables any new financing they can find free and clear to go towards improvements.
TIfs and everything else can be ironed out and we still won't have enough to improve all our infrastructre and schools and everything else. How was it that you proposed we do it? Charge motorists the full costs of using the roads or something. Let me know when that proposal comes along.
For now, this works for the CTA and the city taking some of the responsibility. I guess we'll see how much hardship $300 per $100,000wreaks across the city.
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