Illinois statutes require that the assessed value of non-farm property equal 33 1/3 percent of its market value (except for Cook County). However, assessment levels may vary from the statutory 33 1/3 percent within an assessment jurisdiction, between assessment jurisdictions, within a county, and between counties.
These differences occur for several reasons including the large number of local assessing officials who have different opinions about value, and the inherent difficulties of the assessment process (e.g., pressures to keep assessments low, lack of time and resources to do a thorough job, ministerial errors, outdated valuations, and changes in economic conditions).
Assessment levels must be uniform to ensure
- Equal distribution of the tax burden among taxpayers;
- Fair distribution of state grants-in-aid for education, highways, and public assistance (assessed valuation is a component in the formulas used to calculate these distributions); and
- That tax rate and bonded indebtedness limitations are applied to local government taxing bodies on an equal basis.
Equalization factors/multipliers may be applied by the Chief County Assessment Official, Board of Review, and the Department of Revenue.
Assessors try to maintain a uniform level of assessment within their jurisdiction by using recognized appraisal techniques to determine market values and by reassessing property on a regular basis so that market values are as accurate as possible before applying the legal level of assessments to the market values. Even so, some variation in assessment levels may exist.
A statistical process called an assessment/sales ratio study is used to find the ratio of property sale prices to their assessed values. The assessment/sales ratio study shows whether or not assessments within a given area actually average 33 1/3 percent of market value. If the results of the study indicate that assessments are either higher or lower than 33 1/3 percent an equalization factor/multiplier is calculated and applied to all non-farm property to bring the level of assessment to 33 1/3 percent. The process of adding the equalization factor/multiplier is called intra-county equalization.
When the State of Illinois equalizes assessments the process is called inter-county equalization. This eliminates certain tax burden inequities among taxpayers who live within the boundaries of taxing districts that overlap two or more counties.