Evanston aldermen will ask voters in November to adopt the first graduated real estate transfer tax in the state.
The proposal, from Alderman Ann Rainey, 8th Ward, was initially rejected by aldermen Monday night, but then adopted on a reconsideration vote after Rainey told her colleagues, “You had a chance to do something that wasn’t regressive, and you blew it.”
City staff had recommended increasing the existing flat-rate transfer tax from $5 to $7 per $1,000 of a property’s sale price — a 40 percent increase.
Rainey instead proposed keeping the tax the same for properties priced at less than $1.5 million, raising the tax to $7 per $1,000 for properties selling for between $1.5 million and $5 million, and increasing it to $9 per $1,000 for properties selling for more than $5 million.
Rainey said her plan would generate about a half million more in annual revenue for the city than the plan staff had recommended, adding that she didn’t want the majority of residential taxpayers to have to pay more than they do now.
Alderman Robin Rue Simmons, 5th Ward, said there’s no space for an increase in taxes for the average Evanston resident, that families and seniors are losing their homes and living in unacceptable conditions because of the city’s existing tax rates.
Rainey’s plan initially only drew support from Rue Simmons and Alderman Peter Braithwaite, 2nd Ward.
But after Alderman Cicely Fleming, 9th Ward, moved to reconsider the vote, it carried 5-3, with Aldermen Judy Fiske, 1st Ward; Melissa Wynne, 3rd Ward, and Eleanor Revelle, 7th Ward, voting against it.
Those lakefront wards have some of the city’s priciest homes whose owners likely would be hit by the progressive tax proposal.