A property tax dispute, which had some condo owners fearing they might need to pay taxes twice, appears to have been resolved.
In the end, the 2007 property tax bill for 1120 Lake will drop from $1.9 million to $515,000.
After a Chicago-based developer finished constructing a 7-story building in downtown Oak Park in early 2007, a tax bill was issued for the property. Since it was the 1120 Club’s first year in existence, the bill lumped together the entire property, which includes 44 condos, a fitness center, Bar Louie and Lane Bryant.
At the closing of each condo sold in 2007, the developer, RSC & Associates, set aside money in a bank account to pay the property taxes.
But RSC says it didn’t receive the bill for 2007 taxes, paid in 2008, until October of 2008, after the appeal period ended.
The bill totaled $1,888,921 for the commercial space and condos, far higher than expected. In adding up the amount, the county assessor assumed the building was 100 percent occupied, far from the case, said Oak Park Township Assessor Ali ElSaffar.
The taxes were due by Nov. 3, 2008. Because of some unexplained error, RSC said it didn’t receive any bill until after the appeal period closed, Wednesday Journal reported in March. To remedy the situation, they filed for a certificate of error to attempt to lower the bill.
The appeal paid off, as the county dropped the tab to nearly a fourth of the previous total. The decision was made May 27 and still needs approval in court, which will happen sometime in July, ElSaffar said.
In the interim, RSC paid $135,000 toward its 2007 property taxes in order to limit interest costs. ElSaffar estimated that the developer will need to pay $45,587 in late fees for the unpaid portion of the balance. That number would jump by another $5,700 if the bill is still unpaid tomorrow, July 2.
“I’m hoping the developer would pay the bill very quickly now because they’ve got what they wanted, which is a lower bill,” ElSaffar said. “They did make a promise to all these unit owners that they’d pay this bill.”
Despite the interest costs, Richard Curto, RSC principal, said his company will pay the remainder of the bill when it’s due, which he expects will be in the fall.
“We had to weather the storm,” he said. “However, we absolutely did the appropriate thing.”
The lower taxes are only a one-year deal, as ElSaffar says the bill will increase to more than $1 million with the building occupied in 2008.
CONTACT: mstempniak@wjinc.com