Chicago Bears would get break on property tax valuation for former Arlington Park, but won’t get cut on tax rate, under proposed ruling

Robert McCoppin, Chicago Tribune
Updated ·4 min read
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Chicago Bears would get break on property tax valuation for former Arlington Park, but won’t get cut on tax rate, under proposed ruling

The Chicago Bears got a preliminary split decision on their property tax appeal for the former Arlington International Racecourse Tuesday when the Cook County Board of Review proposed cutting the property’s valuation, but keeping its tax rate unchanged.

The tax appeal board valued the racecourse property at $138 million, down from the $192 million market valuation by the Cook County assessor.

But the board also ruled that the land should not be classified as vacant for 2023, because its grandstand was not completely demolished until December. That means the property would be assessed as a commercial property at 25% of market value, rather than the 10% for vacant land that the Bears wanted.

The result is a valuation about 45% higher than the $95 million that local schools negotiated last year for the property with former owner Churchill Downs Inc. That settlement resulted in a tax of $8 million, so the new valuation would suggest a tax closer to $12 million.

The decision is not yet official, but board Commissioner Samantha Steele shared the ruling that she said had preliminary agreement from the other two commissioners. A final ruling is due by the end of February.

While it was widely reported last week that the board had decided against giving the Bears a break on the valuation, that was a premature declaration, in hopes of encouraging a settlement.

The proposed ruling increases the chances of the Bears building a $5 billion enclosed stadium and entertainment and housing complex on the site in Arlington Heights. But the team remains in talks with Chicago for a new stadium there and has heard offers about other suburban sites. The team’s current home is 100-year-old Soldier Field.

The Bears and school officials did not comment, but if team officials don’t like it, they can appeal to the Illinois Property Tax Appeal Board, or file suit in Cook County courts — but either process could take a long time.

The Board of Review echoed the team’s concern that the assessor was “sales chasing,” meaning basing its valuation on the $197 million the Bears paid for the site in 2023. Sales chasing is prohibited by the Illinois Constitution, but court rulings in other cases have said that sales price can be considered as the best indicator of fair market value.

The team had tried to negotiate a settlement with Arlington Heights-based Township High School District 214, Palatine-based Township High School District 211 and Palatine Community Consolidated School District 15, which receive the bulk of the property tax revenue from the racetrack site. But since the team and the schools were $100 million apart on their appraisals of the property, those talks have failed to reach a resolution.

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So much is riding on the outcome that the Bears have suggested it forced them to look to Chicago or elsewhere for a new stadium. School officials have countered by warning that if the property taxes are frozen through legislation, the valuation could keep property taxes on the site artificially low for years to come, forcing other taxpayers to pay more.

The process started with the Cook County assessor’s triennial reassessment of north suburban properties in 2022. Assessor Fritz Kaegi’s office raised the valuation of the site from $33 million to $197 million, matching what the team paid to buy the property in February of 2023.

A school official had called the $95 million valuation “a reasonable compromise,” and the Board of Review called it a “fair settlement.” But Bears CEO Kevin Warren called it a “non-starter” for a property that would sit unused until at least 2026.

The property is somewhat unusual in that it’s a former horse racing track in a highly desirable location, near Interstates 90 and 355, and next to a Metra commuter train station. Normally, the assessor can use a property’s income to help determine its market value, but in this case the site has appreciable no income.

This year, the assessor’s office estimated a true value range of $189 million to $256 million, but chose the lower end, in part taking into account the Bears’ demolition of the grandstand.

The Bears alleged that the assessor had unfairly jacked up the value of the land nearly seven-fold, to around $15 per square foot. The assessor’s office argued that the price reflected the local real estate market. The Board of Review settled on a land value of $10 per square foot.

The Bears highlighted other area properties that they said were treated very differently.

The former Allstate headquarters in Northbrook sold for $232 million in 2022, and was valued by the board at $55 million. The former United Airlines headquarters in Mount Prospect sold for $54 million and was valued by the assessor at $17 million. And a number of properties in the booming West Loop were valued at a small faction of their sales prices.

The Bears also pointed out that the schools’ appraisals were based on using the site for data or logistics centers — but the village prohibits those uses from locating there.

rmccoppin@chicagotribune.com