IL bill could overhaul tax sale system, stabilize neighborhoods

SPRINGFIELD, Ill. (WAND) — An Illinois Senate Democrat filed a bill Tuesday to overhaul the tax sale system.

Sen. Willie Preston (D-Chicago) told reporters in Springfield that thousands of families have lost their homes over relatively small property tax debt. He argues local governments should not be able to steal someone's home to collect a tax bill.

Preston said his plan would keep families in their homes, end predatory practices that strip away equity and require fair notice and transparency for homeowners.

"When people are kicked out of their homes and their property taxes are now more than their homes, people just walk away from their properties and their life savings, or they simply don't pay them," Preston said. "They don't pay their mortgage and stay inside their homes because they know, in those particular municipalities, that their homes won't even be bought in a tax sale because they're worthless to investors."

Senate Bill 2830 would also cap sale-in-error refunds to limit the amounts speculators can recoup when sales are found in error. The bill could remove excessive financial incentives for predatory buying as well.

"We're working to end risk-free speculation, forgiving crushing tax debt when it's unjust, and putting properties back into the hands of residents, nonprofits and local developers who will actually invest in our neighborhoods," Preston said.

The Property Justice & Community Recovery Act would automatically forgive tax debt when it exceeds 125% of a property's value in hopes of keeping families in their homes. This plan also creates a trust within the Illinois Treasurer's Office to clear property titles and transfer ownership to residents, nonprofits, and churches for $1.

Preston said he looks forward to talking with the Illinois Municipal League and other organizations about his proposal.

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