Illinois Supreme Court rejects effort to block Bring Chicago Home referendum

The Illinois Supreme Court Wednesday rejected an effort to invalidate the so-called Bring Chicago Home real estate transfer tax referendum, clearing the way for the question to remain on ballots and for votes to be counted.

The court denied the petition filed by the Building Owners and Managers Association of Chicago to appeal a lower court’s ruling. The decision from the state’s top court likely brings an end to weeks of legal feuding between the referendum’s supporters and opponents ahead of the election.

The brief order shared by the court Wednesday did not indicate why the BOMA Chicago appeal was denied.

BOMA Chicago Executive Director Farzin Parang called the ruling disappointing, but said it was nonetheless important to contest the “misleading and manipulative” referendum.

“This back-door property tax hike would hurt our downtown and local neighborhoods alike, impacting homeowners, renters, union workers and businessowners large and small,” Parang said. “What is especially troubling is that Mayor Johnson’s transfer tax hike would give the city a blank check with no accountability for improving our housing and migrant shelter crises.”

But the ruling on the “flimsy” legal effort by “big-money corporate real estate” drew praise from the Bring Chicago Home group’s Doug Schenkelberg, executive director of the Chicago Coalition for the Homeless.

“Fortunately, with this latest decision by the IL Supreme Court, voters now have the power to set Chicago on a new path: where big corporate landlords pay their fair share, where there is legally dedicated local funding for affordable housing and support services, and where 68,000 homeless Chicagoans have a place to call home,” Schenkelberg wrote.

The referendum seeks to raise what proponents estimate as $100 million in annual tax revenue earmarked for fighting homelessness by hiking the transfer tax rate on real estate values over $1 million. The policy pushed for by a broad group of progressive organizations and homelessness services groups has been strongly backed by Mayor Brandon Johnson, who led a City Council push to get the referendum onto the March 19 primary ballot.

Cook County Judge Kathleen Burke invalidated the referendum in late February, ruling in favor of BOMA. The group challenged the multipart nature of the question and argued the city’s spending plans for fresh revenues were vague. The ruling meant that votes on the referendum would not be counted, even as the question remained on ballots.

But last Wednesday, a state appellate court overturned the ruling, arguing it was improper for the courts to intervene in the middle of a legislative process. The decision cleared the way for the Chicago Board of Elections to tally votes in the March 19 primary.

If voters approve the referendum, the Chicago City Council would then officially vote to change the city’s flat 0.75% tax charged on the price of a property sale.

Properties purchased at less than $1 million would see their rate cut to 0.6%. Properties purchased between $1 million and $1.5 million would have a 0.6% tax on the first $999,999 of the sale price and 2% on the rest. Sales above $1.5 million would pay 0.6% on the first $999,999, 2% on the next $500,000, and 3% on the rest.

Opponents could challenge the referendum results after Election Day, legal experts previously told the Tribune.

“The court’s opinion said nothing about the merits of the case one way or the other. It just said that it was brought too soon,” attorney Michael Forde, a partner at Forde & O’Meara who focuses on litigation, said earlier this month. “It would be like filing a constitutional challenge to a bill when that bill has only passed one house of Congress. So, if the referendum passes and becomes law, the plaintiffs can refile their challenge to the process by which it became law.”

“That’s an understatement to say there’s an opening to challenge it after the fact,” Forde said.

“I think a possible challenge could come once the City Council passes the ordinance,” election attorney Michael Dorf agreed. Attorneys could make similar arguments as the original case: that the referendum violated the state’s municipal code and constitution by asking more than one question, or that the city’s spending plans were too vague.