The "Bring Chicago Home" real estate transfer tax has been one of the most talked-about questions on voter ballots in the city, but with Election Day over and results largely in, did voters approve it or reject it?
The referendum was designed to give city voters an opportunity to determine how real estate transfer taxes are assessed.
As of Wednesday morning, results still had not been called, despite 98% of precincts reporting. As of 9 a.m., results showed 54% of voters, or 166,285, voting "no" on the referendum, while 143,624, or 46%, voted "yes."
According to the Chicago Board of Elections, there were nearly 110,000 vote-by-mail ballots that had not been received as of Tuesday morning, which could play a role in the results.
Here are the latest updates on the ordinance:
Proponents called early election returns on the measure "disappointing," but have vowed to continue fighting.
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“While tonight’s election results are disappointing, we are nowhere near the end of our journey,” the group said in a statement. “Whatever the final count, one thing is abundantly clear tonight: how determined our opponents are to continue profiting from displacement and inequality.”
What is the "Bring Chicago Home" referendum and how would it work?
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The measure, connected to real estate transfer taxes in the city, has also been referred to as a so-called "mansion tax."
Rather than taxing property specifically, transfer taxes only apply when a property is sold, whether that be a residential or a commercial property.
As things stand, all real estate transfers in the city are taxed at a rate of $3.75 per $500 of assessed value.
Under the proposed referendum, that tax would have been changed to a graduated rate. For property values under $1 million, the tax rate would be $3 for every $500, a reduction of 20%.
For property values over $1 million and under $1.5 million, the tax rate would increase to $10 per $500 in value, an increase of 166.67%. Finally, any value over $1.5 million would be taxed at a rate of $15 for every $500 in value, an increase of 300%.
Under the terms of the proposed law, money would be used exclusively toward “any support provided by the city or a delegate agency selected by the city to people experiencing or at risk of homelessness, including providing permanent affordable housing and the services necessary to obtain and maintain permanent housing.”
Money would also be allocated toward capital costs at existing congregate shelters, and would also be used to provide beds and housing during times of extreme and severe weather, and toward operational costs involving pay equity for employees at shelters in the city.
Finally, the funds would be available to all residents, regardless of immigration status.
What are the pros and cons?
Supporters of the measure said the measure would decrease the transfer tax rates for 94% of properties in the city, but opponents warn that it would have had a damaging impact on commercial real estate transfers, causing fewer businesses to relocate into the city.
For example, the median home sale price in Chicago in Feb. 2024 was $339,000, according to Redfin. Under the proposed tax structure, the transfer tax that would be paid on a property of that value would be $2,034, compared to $2,543 under the current system.
At $999,999, the proposed maximum property value that would still qualify for the $3 per $500 tax rate, a Chicago resident would save $1,500 in real estate transfer taxes.
A property valued at $1.5 million, however, would see a proposed real estate transfer tax of $16,000, an increase of nearly $4,800 over the current rate.
According to supporters, the measure would help to generate funding to address homelessness concerns in the city, providing monies for various projects and shelter initiatives. Critics of the measure said that it could have a chilling impact on the city’s commercial real estate market, which is still trying to recover after the COVID pandemic.
There were also criticisms over how money would be allocated, with elected members of the "Bring Chicago Home" board being appointed by the City Council and Mayor Brandon Johnson.
The "Bring Chicago Home" advocacy group says that their efforts have “made our movement stronger over the long haul,” indicating that they will continue to push for similar efforts in the future.
The Illinois Policy Institute, a conservative-leaning thinktank that led legal opposition to the measure, called the vote a "political blow" to Chicago Mayor Brandon Johnson, who supported the ordinance.
"Even in a low-turnout primary, Mayor Johnson failed to move enough voters to advance his chief proposal to hike Chicago's real estate taxes," CEO Matt Paprocki said in a statement. "This is a political blow to Johnson and the Chicago Teachers Union, who aggressively supported this tax hike."
If the measure fails, it will likely be viewed as a rebuke of Johnson, who has been criticized for his handling of numerous crises in the city during his time in office.
What would happen if the measure is approved?
If voters approve the measure, the Chicago City Council would be required to draft a final version of the ordinance, and would have to approve it and send it to Mayor Brandon Johnson for final approval.
According to the draft ordinance, it would be set to take effect on Jan. 1, 2025.
