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Teardown tax may be torn up

Evanston’s new housing teardown tax appears to be headed for the trash heap.

The city’s legal staff, responding to questions raised by a local property owner, has concluded the ordinance adopted last fall is legally flawed.

Assistant Corporation Counsel Ellen Szymanski said the provision the council included to exempt existing residents from paying the tax if their replacement home was valued at less than $500,000 might not hold up in court.

While few new homes in Evanston sell for less than that amount, it’s still double the established price for affordable housing under federal guidelines.

As a result, Ms. Szymanski told the Planning and Development Committee at a special meeting last night, the city might have difficulty justifying the exemption from a challenge on equal protection grounds.

Alderman Ann Rainey, 8th Ward, said, “How can we say to people who have a growing family and want to stay in the neighborhood that if you tear down your house and rebuild we’re going to tax you $10,000 to do it?”

The committee voted 8 to 0 to recommend repeal of the ordinance to the full City Council. Alderman Edmund Moran, 6th Ward, who originally proposed the teardown tax, had left the meeting before the committee took up the tax issue.

Revenue from the teardown tax was intended to support affordable housing programs. The city recently collected its first payment under the tax, and aldermen voted to refund that payment if the ordinance is repealed.

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