Project description

For decades, citizens and activists wondered about the fairness of Cook County’s property tax assessment system, but its complexity and opacity made drawing conclusions nearly impossible. Now, thanks to the unique skills of reporter Jason Grotto, Cook County’s broken assessment system finally faces a reckoning. Grotto studied the arcane system for two years, reading thousands of documents, analyzing more than 100 million computer records and interviewing dozens of experts, attorneys and property owners affected by deeply flawed assessments. The result is the four-part series “The Tax Divide,” which exposed widespread inequities and egregious errors in assessments that punished poor homeowners and small businesses in Chicago and nearby suburbs while giving the wealthy unsanctioned tax breaks and lining the pockets of politically connected tax attorneys. Within weeks of publication of the first stories in July, the county’s inspector general launched an investigation of the assessor’s office. The Cook County board required Assessor Joseph Berrios — one of the most powerful politicians in the state — to testify at a public hearing about his methods, something unheard of in a county controlled by Democratic Machine politics. The board president, meanwhile, ordered a study of residential assessments. And state and local lawmakers introduced legislation to limit campaign contributions to the assessor. Drawing heavily on “The Tax Divide,” three prominent public-interest law offices sued Berrios and the county in December, alleging violations of state and federal civil rights and housing laws. A week later, a prominent good-government group co-founded by former U.S. Senator Paul Simon called on the county to increase transparency and fairness of the assessment system, vowing to lobby commissioners to force change. The issue of fairness in the property tax system has become a major issue in statewide elections for 2018, with multiple candidates calling on the assessor to resign following the series. And, despite being the chair of the Cook County Democratic Party, Berrios now faces serious contenders in the March primary as he seeks re-election. The bedrock of the first three stories is a detailed analysis by Grotto that follows the same rigorous protocols experts use to measure the fairness and accuracy of residential assessments. The analysis was published as a research paper online, giving readers the opportunity to see the depth of Grotto’s work and his full methodology. After publication, it proved to be a bulwark against attacks from the assessor’s office after the stories were published. The findings were staggering. The county’s assessments were so faulty that experts said Grotto’s analysis called into question the integrity of the entire property tax system. Among the most significant statistical conclusions was the high level of regressivity — the overvaluing of low-priced homes and the undervaluing of high-priced ones. The analysis helped lead to another major finding: The assessor knew the system was unfair and misled the public about trying to fix it. In July 2015, officials issued a news release heralding the adoption of a new, “state-of-the-art” computer model to value residential properties. Yet Grotto’s study found the assessor had not implemented the model. When Grotto went back to the experts with his reporting, they were aghast. The assessor had lied to them. Confronted with the findings, the assessor’s office insisted the county’s robust appeals system corrects whatever flaws exist and makes the system fair. Yet, teaming up with the University of Chicago’s Harris School of Public Policy, Grotto showed that the appeals process in Cook County not only failed to make assessments fairer, it actually made them less so. He also analyzed campaign contributions and 3.6 million appeals to show the cozy relationship between Berrios and the property tax appeals industry, which provides the bulk of Berrios’ campaign money and includes many of the state’s most powerful politicians. As Grotto’s reporting progressed, the assessor’s office began withholding information, refusing to release basic documents about how it calculated commercial and industrial property values. So, the Tribune sued the office and won in circuit court. The assessor appealed, and the case is ongoing. Even without access to those records, the Tribune and ProPublica Illinois teamed up in July to continue reporting. The result was an in-depth look at commercial and industrial assessments, with ProPublica data reporter Sandhya Kambhampati partnering with Grotto. Kambhampati and Grotto conducted three separate complex analyses. The first examined tens of thousands of parcels of property and found that, for more than two-thirds, the assessor’s values remained identical from one reassessment period to the next. Experts said that would be virtually impossible had the assessor’s office actually done the work of valuing the property. In most of those cases, property owners won reductions on appeal, only to see the values snap back to the same number, fueling yet more appeals. The second analysis revealed the same accuracy and fairness issues found in residential assessments, with small businesses punished while owners of downtown skyscrapers caught massive tax breaks. Finally, the team identified the politically powerful law firms profiting off the county’s inaccurate assessments, providing the first comprehensive look at the billions of dollars at stake. “The Tax Divide” represents a unique achievement in journalism, uncovering a fundamentally unfair system in one of the largest, most economically divided counties in the country. Grotto didn’t just use data, didn’t just crunch numbers — he mastered an opaque subject, then combined some of the most sophisticated tools a journalist can find with traditional shoe-leather reporting to bring home a story of vital importance to the community.

What makes this project innovative?

“The Tax Divide” melded high-level statistical analysis with traditional shoe-leather reporting to bring home compelling stories of vital interest to the public. The stories were based on a multiple analyzes, each one presented as research papers online so that readers could delve more deeply into the methodology and better understand how assessments work. The studies allowed the reporters to write with authority and identify victims. They not only provided the framework for the series but also proved to be a bulwark against attacks from the assessor after the stories were published. The partnership between the Tribune and ProPublica Illinois as well as the work with the University of Chicago’s Harris School of Public Policy showed the power — and importance — of collaboration.

What was the impact of your project? How did you measure it?

Reaction to the series was swift and telling. The inspector general for Cook County launched an investigation almost immediately, and the county board president ordered a study of residential assessments by an outside consulting firm. The county board also required Assessor Joseph Berrios to testify at a public hearing about his methods — a remarkable move because Berrios is one of the most powerful politicians in Illinois and head of the Cook County Democrats. Yet members of his own party were now challenging his record. State and local lawmakers, concerned that the property tax system favored those who supported Berrios politically, introduced legislation to limit campaign contributions to the assessor. Recently, three prominent public interest law offices sued Berrios and the county, alleging violations of state and federal civil rights and housing laws. The suit draws heavily on “The Tax Divide” in alleging that the county’s assessment system under Berrios is “perpetuating institutional racism.” A good-government group co-founded by former U.S. Sen. Paul Simon also called on the county to increase transparency and fairness of the assessment system, vowing to lobby the county board for change. Multiple candidates running in the statewide 2018 elections have called on the assessor to resign, and Berrios now faces serious challengers in his own re-election effort. Three U.S. congressmen have endorsed one of his rivals in the Democratic primary.

Source and methodology

Grotto had to acquire numerous technical skills to overcome the many roadblocks encountered in this project, which had an extraordinarily high level of difficulty. Merely storing the many gigabytes of data involved required Grotto to learn how to use Amazon’s cloud computing services, and he used more than a dozen software programs to clean and process the data. Grotto also taught himself R, an open-source statistical program that was the ideal tool to analyze the numbers. The assessor’s office does not use geographic mapping software, so Grotto spent weeks compiling a GIS database of real estate parcels that allowed him to measure the fairness and accuracy of residential assessments by neighborhood — something that hadn’t been done before. When the assessor refused to release detailed records on how the office values commercial and industrial properties — a matter the Tribune is challenging in court — Grotto and Kambhampati were still able to use tens of thousands of individual assessment records, from small businesses to skyscrapers, to document unfairness in the system. Finally, because the assessor’s office is so powerful, many property owners were afraid to speak publicly about their assessments. Reporters spent weeks crisscrossing the county to persuade residents to share their stories, ultimately obtaining the compelling personal anecdotes that helped frame and activate the story's technical findings.These stories relied on multiple data sets, which were obtained using the state’s FOIA laws. The data include more than 100 million assessment records, about 1.5 million records from the state’s property tax transfer declaration database, and about 3.6 million appeal records. We also analyzed about 15 million property-tax-bill records from the county treasurer’s office. The series also relied on thousand of pages of documents, including studies, land records, lawsuits, appeal files and building inspection reports. Although the assessor’s office was forthcoming at first, officials refused to release detailed records on how the office values commercial and industrial properties as well as information on how thousands of values produced by the assessor are changed by hand and how many were changed. The Tribune ended up suing the county in Circuit Court, claiming it was violating FOIA laws. The newspaper won in December 2016, but the assessor has since filed an appeal. That case is still pending. Despite limited access to information on commercial and industrial valuations, Grotto and Kambhampati analyzed tens of thousands of assessment records to show how the system failed small business while rewarding owners of downtown skyscrapers.

Technologies Used

We used four key databases, all of which were obtained for free: 1) Cook County Assessor’s assessment data, detailing values for each “pass” of the assessment process; 2) Illinois Property Tax Transfer Declaration data (PTAX), which lists all real estate transactions and vital details about the sales. 3) Cook County Assessor’s appeal data, which lists every appeal, the reduction amounts and the law firms that filed the appeals; 4) Cook County Treasurer’s Master File, which lists every property tax bill sent by the county. The volume of data became a problem. To manage this, we bought server space from Amazon, which allowed us to pull data down rather than storing it on local machines. Data from the assessor’s office and the state required extensive processing before the analyses could be done. The series was based on 14 years worth of sales ratio studies, which compare the assessor’s estimated market values and assessments to actual sale prices. The analysis required multiple computer programs to clean, process and compiled the data. Experts were enlisted to vet our analysis and sign off on the findings. We also produced two studies as part of our reporting, including the one in conjunction with the University of Chicago. The 125-page sales ratio study and the 27-page appeals study were made available on the Tribune’s website. Jason Grotto conducted the sales ratio studies and helped guide a graduate level course on property taxation, which produced the study on the appeals system. He also teamed up with Sandhya Kambhampati to do ratio studies on commercial properties. They used R, QGIS, Excel, PostGres to conduct the analyses.

Project members

Sandhya Kambhampati, ProPublica Illinois


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