Alderman Ann Rainey, 8th Ward, says she thinks the city should propose a referendum to increase the Real Estate Transfer Tax to help fund affordable housing programs in the city.

Rainey, speaking at a meeting of the City Council’s Inclusionary Housing Ordinance Subcommittee this evening, said, “There’s a lot of affordable housing advocates who’d work for it.”

“If this community is for housing for everyone,” Rainey added, “We should ask the community to buy into supporting affordable housing.”

The only other aldermen present for the committee meeting, Don Wilson, 4th Ward, agreed that such a referendum could be part of “an equitable solution” to the problem.

Rainey noted that the transfer tax would capture revenue from the sale of commercial property as well as homes.

But one of the residents in the audience for the meeting, Ray Friedman, objected, saying, “I’m already paying a transfer tax and don’t want to have to pay another one.”

Friedman suggested that only developers of new buildings “who are in business to make money” should have to fund the affordable housing effort.

Evanston currently charges a real estate transfer tax that, except for certain exempt transactions, amounts to $5 per $1,000 of the price of any property sold in the city. State and county transfer taxes add another $1.50 per thousand to the cost of a sale.

In November 2006 Evanston votes defeated a proposed 20 percent increase in the city transfer tax targeted for affordable housing by a fairly narrow 51.7 to 48.3 percent margin.

A similar referendum, but with the tax hike targeted to funding public safety pensions, was soundly defeated — 57.9 to 42.1 percent — at the presidential primary election in Feburary 2008.

Rainey said the city has already missed the deadline to get a transfer tax increase on the March 20 primary election ballot, but could still get it on ballot for this November’s general election.

When the council scheduled the 2006 vote, one housing advocate, Sue Carlson, apparently anticipating a tough road to approval for the tax hike, called the referendum a betrayal of affordable housing.

The revenue generated by the transfer tax varies from year to year based on the state of the market, but the city’s budget projects it will produce $3.3 million this year.

Bill Smith is the editor and publisher of Evanston Now.

Join the Conversation


  1. Are you kidding me?

    When is enough enough? Please tell me now if these tax hikes are going to go on and on. With the elimination of the SALT subsidies I for one have about one foot out the door. 

    1. transfer stamps

      let’s see now… it’s $5 per $1000 in Evanston for the seller to pay.. Glencoe is $ 0… Wilmette is $3 per $1000 for the buyer to pay…. an $800,000 home for sale now in Evanston has a $20,000 re tax on it  ( CCA has it valued at $800k so no protesting your taxes on that one) and the home needs at least $500,000 in repairs…. tell me who’s going to buy in Evanston… re tax is skewed to the point of criminal in some of our poorest neighborhoods how about trying to give an all out effort to lower their taxes to help them “age in place”. we have beautiful vintage rental buildings throughout south Evanston… how about trying to approach those management companies  … every single one of them has for rent signs in front…

      1. Evanston is in the minority.
        In fact, ninety-five percent of Illinois municipalities do not have a real estate transfer tax, and of those that do, Evanston is already among the highest. Transfer taxes are regressive, unfairly penalize those who move more frequently (which tends to skew on the lower end of the socio-economic scale), and increase housing costs, limiting housing choices for some on the margins. The National Association of REALTORS estimates that for every $1,000 increase in the cost of a house, 250,000 people are priced out.

        Howard Handler
        Government Affairs Director
        North Shore – Barrington Association of REALTORS

    2. Why is it always called
      Why is it always called affordable housing? Can we call it what it actually is which is subsidized housing?

  2. I support this idea
    The city council seems to have a hard time with the affordable housing issue whenever a big residential development project comes up. Moving funding to a tax revenue source could mean they will not have to have that debate every time someone wants to add new condos or apartments to the City.

    As for the argument that we should stick the cost to developers because they are profit motivated, we are all trying to make money. I am sure most property owners would like their property values to go up during the time they own them. In other words, we each want OUR OWN properties to become less affordable, while some want more affordable housing at the same time.

  3. Only one answer
    These people have only one answer to every question…raise taxes.
    When you have to build affordable housing you have to raise taxes. When you tax people more they move out of the city. When they move out of the city you have raise taxes higher on the people that are left. Then they leave. This is how you destroy an economy/city.

    1. different answer this time
      In this case “they” (meaning Ald. Rainey) are putting the question directly to voters. The approach now is the council decides how much to tax each development project. This is chaos. Although there is supposed to be a rule on how much to contribute to affordable housing via units or cash, the power to grant variances is sometimes used to squeese more out on a case by case basis. Although not a very steady steam of income the transfer tax is more stable than hitting up developers whenever they want to do big projects. If the consensus in the community is that it wants more money in an affordable housing fund, then the funding source should have a broader base. if the consensus is that it does not want to pay for it, then the council will know they don’t have to keep squeezing developers to represent the will of their constituents.

  4. No, no, no, no, no,no,no,no,no!!!
    The problem with a referendum on an increase in transfer tax for affordable housing is there are more renters than property owners in Evanston. A transfer tax won’t affect renters.

    The city already has millions in its affordable housing fund. Why does it want more? Evanston has tons of affordable housing, more than any other suburb north and west of Chicago. A few years back Evanston got an $18 million federal grant to stabilize two neighborhoods, which produced more than 75 rehabbed low income rentals and about 50 more rehabbed affordable housing sales.

    I think our city officials want more money for their pet projects and favored non-profits. Rainey is leading the charge. How much did Evanston taxpayers lose on the loan to the Chicken and Waffles restaurant that closed and failed to pay back the city loan? Who’s accountable for that failure?

    It seems that all our elected officials are interested in doing is to increase spending and raise taxes. How about cut back, consolidate departments and lower our taxes for once. We must organize and vote out all of incumbents.

    A word to enterprising investigate journalists, my gut tells me there is plenty of waste, fraud, patronage and favoritism going on in this city. This is typically the case when you have bloated bureaucracy, tons of government grants and loans with non-profits at the teat and a big government mindset among elected officials. Your vote. Your choice.

  5. Crazy Talk

    Great idea!  Let’s raise our already too high taxes so crime can go up. I worked hard so that I could afford to live in Evanston. Low income residents tend to increase crime and degrade school scores. No matter what your politics, I’m a registered Democrat, you would have to admit that low income housing degrades the quality of life for everyone else. If you can’t afford to live in Evanston, move to Chicago. Please, no more affordable housing, or; if we want to call it what it is, “The projects”. 

  6. Rainey
    Ms Rainey was there in the city council since 1983. She was previously employed by HUD. Was coordinator for CEDA, neighbors at work; Director of Housing for Howard Area Community Center; Manager at not-for-profit developer Peoples Housing,according to Ev Roundtable. Are we surprised that with that kind of background she has grown to see Evanston as her own home to be constantly redeveloped with taxpayers money as her eternal billion-dollar grant?
    Then we also have Evanston’s for ever bloated bureaucracy enjoying also free grants from Evanston Taxpayers.

    Who was that once said, “The problem with socialism is that you eventually run out of other people’s money.?”

    1. Don’t forget

      Don Wilson agreed with Ann Rainey and considered a additional home seller tax could be the solution.

  7. Only in Evanston (uber
    Only in Evanston (uber-liberal even by Illinois standards) would the “leadership” propose making housing “affordable” by raising taxes…again. And again, and again.

    Over time, this will backfire spectacularly. All those with resources will leave. But YES!: You’ll skin them one more time by taxing them MORE as they leave.

    And, they will sell and leave. And the City will destroy their home’s equity.

    This is exactly why I left a year ago (Sadly, because I loved Evanston).

    Every tax hike is a nail in the coffin, Evanston.

    1. Evanston the next Harvey ?
      No Evanston will not become extremely poor like Harvey, but some effects could be the same.
      Harvey has a very high tax rate because there are so few people who can [income] pay taxes.
      Evanston’s tax and spend [not to mention other policy] could mean a similar effect. The population has not grown; city government wants more affordable and, though they won’t say it low income [‘diverse’] housing. No matter how noble, those populations will have less income to pay taxes. The government [and vocal groups] oppose new apartment, condo, office buildings. Someone has to pay the bills the Council racks-up.
      Either the cost of living in Evanston becomes too high and the low/’affordable housing” population leaves Evanston or the middle/high income population [or potential population] decides Evanston is not for them.
      Then who pays the bills for roads, arts groups, pensions, affordable housing and on and on. Either the public wises-up, or people leave or their houses go into foreclosure. That in turns pushes taxes higher. Maybe even the Mayor and Council and city management decide Evanston is too expensive, or school have gone down-hill or crime rose—and they too move.

  8. Evanston City Council Pledge
    We’ll tax you when you move here,
    We’ll tax you when you stay,
    Stay a little longer,
    We’ll tax you more, every day.

    When you have had enough,
    And swear you’ve given your last dime,
    We’ll not let you go,
    Until we tax you one more time.

  9. Taxman
    Let me tell you how it will be
    There’s one for you, nineteen for me
    ‘Cause I’m the taxman, yeah, I’m the taxman
    Should five per cent appear too small
    Be thankful I don’t take it all
    ‘Cause I’m the taxman, yeah I’m the taxman
    If you drive a car, I’ll tax the street,
    If you try to sit, I’ll tax your seat.
    If you get too cold I’ll tax the heat,
    If you take a walk, I’ll tax your feet

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