Are You Taxing Yourself? | Essay | Chicago Reader

Are You Taxing Yourself? 

Thanks to a little thing called an SSA, you may be--even if you don't know it.

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It was pure happenstance that Peter Zelchenko learned about a property-tax hike for the owners of the buildings that line Lincoln Avenue between Webster and Diversey. "I went to my alderman, Vi Daley, to ask if she could put trash cans on the street," says Zelchenko, who lives on the 2200 block. "She told me about the SSA." His immediate response was "SSA? What SSA?"

Zelchenko calls SSAs, or Special Service Areas, a "secret tax." SSA boosters agree that they amount to a tax but say the people paying it volunteer to pay, making them the most efficient, fairest, and politically safest way to raise funds for services.

Most of the time a local civic group, often the chamber of commerce, proposes an SSA to finance a specific service in a limited district--removing snow from sidewalks, hiring security guards, or building a public parking garage where parking's scarce. The City Council then holds a hearing, and if there are no strong objections and the local alderman signs off on it, the council approves the SSA. "If people want it," says Daley, alderman of the 43rd Ward, "it's hard to be against them."

"The beauty is that there's community oversight," says Brad Leibov, a planner who runs the New Chicago Fund, a consulting firm that helps groups, mainly chambers of commerce, set up and operate SSAs. A board of commissioners--whose members either live, work, or own property within the district--oversees the SSA's annual budget. After ten years an SSA can be dissolved by the local property owners or the city. "I believe in this program," Leibov says. "It gets tax dollars right into the hands of the people who know how to spend it best."

The state legislature set up SSAs back in the 70s, and there are now 34 of them around the city--the Lincoln Avenue one would make 35. As the city has been scrambling to fill gaps in its budget, SSAs have become an increasingly popular way to fund or expand services the city can't or shouldn't pay for. According to Leibov, 13 of the 34 have been created since 2001.

The Lincoln Park Chamber of Commerce proposed the Lincoln Avenue SSA earlier this year. "The SSA will make Lincoln Avenue a more vibrant and pedestrian-friendly area," says Kim Klausmeier, the chamber's president. "It will help bring more shoppers to the street, and that helps everyone." What's not certain is that the people who'd pay for it know they'd pay or know what the money would go for.

When an SSA is approved the city is supposed to notify the owner of every property that's affected. But the mailing list the city uses, the county's list of taxpayers on record, is in many cases outdated, often because the owner lives at a different address. It's not clear how many people got this notice, though some might have gotten it, didn't realize what it meant, and just threw it out. Then there are the renters in those buildings, who will probably never hear about the SSA, even though the cost of it would probably get passed on to them in the form of a rent hike.

Klausmeier says the Lincoln Park Chamber of Commerce sent notices to property owners in May, notifying them of a June 1 hearing on the proposed SSA. Vi Daley says only about 12 people showed up--many fewer than she'd expected. At her insistence, the chamber held another hearing on June 27, but again, she says, "only about a dozen people showed up."

Daley says proposed tax hikes usually draw much larger crowds, especially in Lincoln Park, where taxes are high. And the people who come are usually more hostile. There was little grumbling at either hearing--most people favored the SSA. "There was one gentlemen who was livid," Daley says, but he calmed down after he learned that he lived outside the SSA's boundaries and wouldn't have to pay up. "I was happy he was there, but I wondered how he got a notice," she says. "That says something about the notification process."

Zelchenko didn't go to either hearing because he didn't know about them. He'd just moved back to his parents' house after getting divorced. "I grew up in this house," he says, "but I haven't lived here in years."

His parents, who are long retired, say they saw no notices about the hearings. Zelchenko, an outspoken activist who pursues his causes long after most people would have given up, was against the SSA as soon as he read the copy of the proposal he got from the chamber of commerce. He calls it a waste of money. According to the chamber, the SSA would hike property taxes in the district about 3.8 percent, raising around $149,000 a year, and the owner of the average condo would pay $260 more a year.

And what would residents get for that? The chamber wants to spend $48,000 on 60 flower baskets to hang from street poles, $22,750 for holiday decorations, $20,000 on removing litter from sidewalks and gutters, $18,000 on a planner to manage the program, $12,000 to shovel and salt sidewalks each time at least two inches of snow have fallen, $10,000 to landscape sidewalks, $7,500 to cover budget shortfalls when people don't pay their property taxes, and $6,000 for insurance and office supplies.

Klausmeier and Leibov think all this will make the area more attractive and spare everyone the expense and time of arranging for such services themselves. Zelchenko disagrees. "How does any of this benefit the average property owner on Lincoln Avenue?" he says. "OK, it's nice to have someone shovel your walk. But why would you have to set up this whole program just to hire someone to shovel the walk? It's nice to have people clean the gutters--but aren't we already paying the city to do that? And what's with the $48,000 for 60 hanging plants? That's, what, $800 a year for each basket? And $22,500 for holiday decorations--didn't people used to put that stuff up themselves? And $18,000 to hire someone to run the program?"

He says that the benefits will go mainly to the merchants and that the residents' taxes are already high enough. "My parents' taxes are going up every year as it is," he says. "Last year they paid $13,000."

Klausmeier and Leibov say Zelchenko's the only resident who's strongly opposed the SSA. Leibov says, "I would say that, based on what we have heard, people either support the SSA or are indifferent to it."

Zelchenko thinks most residents simply don't know about it. Alderman Daley is also concerned. She says it's hard to imagine people in Lincoln Park, who pay some of the highest property taxes in the city, welcoming another hike. "I think the SSA is a good idea, but I'm concerned about attendance at those meetings," she says. "I want to make sure enough people want it."

The City Council's finance committee will hold a hearing on the Lincoln Avenue SSA at 10 AM on November 4. Klausmeier, Leibov, and Zelchenko say they'll be there. The city has sent out notices informing property owners in the district of the hearing. Zelchenko's parents were watching for theirs this time and got it. Zelchenko hopes a lot of other people saw theirs too.

Art accompanying story in printed newspaper (not available in this archive): illustration/Mike Werner.

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