But an analysis of more than 40,000 parcels of commercial and industrial property in Chicago shows that, under Berrios, more than two-thirds had identical first-pass values in at least two consecutive reassessments.

Given the complexity of the commercial real estate market and its dynamic nature, experts say it is inconceivable for such values to remain the same over time.

In 2015, as the market continued to climb, Berrios’ office once again arrived at the same number: $13,455,132.

Three years later, in 2012, Berrios had taken office and the commercial real estate market had come roaring back. Yet the assessor’s estimate did not change: $13,455,132.

For example, as the financial crisis cratered the real estate market in 2009, Berrios’ predecessor estimated the value of a stout brick building in a bustling commercial area on Chicago’s Northwest Side at $13,455,132.

State law says the assessor must revalue property every three years. Yet Berrios, using methods hidden from the public, repeatedly produced initial valuations of commercial and industrial properties — known as first-pass values — that did not change.

And because commercial and industrial properties as a group were not assessed properly, residential homeowners across the county were forced to carry an additional and unnecessary burden, paying more in property taxes than they would have otherwise.

What’s more, a separate analysis reveals commercial and industrial property assessments throughout Cook County were so riddled with errors that they created deep inequities, punishing small businesses while cutting a break to owners of high-value properties and helping fuel a cottage industry of politically powerful tax attorneys.

Berrios failed at one of his most important responsibilities — estimating the value of commercial and industrial properties.

That fact, one finding in an unprecedented ProPublica Illinois-Chicago Tribune analysis of tens of thousands of property records, points to a conclusion that experts say defies any logical explanation except one:

Amid the most tumultuous real estate market since the Great Depression, Cook County Assessor Joseph Berrios produced valuations for thousands of commercial and industrial properties in Chicago that did not change from one reassessment to the next, not even by a single dollar.

Nearly a fourth of the parcels — pieces of real estate that receive their own assessment and tax bill — had the same initial value for the Chicago reassessments of 2009, 2012 and 2015.

Under Berrios’ predecessor, James Houlihan, just 1 percent of parcels saw no change over two or more reassessments conducted in 2003, 2006 and 2009.

“For values to stay exactly the same, that indicates they aren’t doing anything,” said Peter Davis, an expert on assessments who helped write standards for the International Association of Assessing Officers, a professional organization that develops guidelines used around the world.

“If your models are working correctly, the chances of values staying exactly the same are virtually impossible.”

Berrios already is under fire for producing inaccurate residential assessments that burdened poorer homeowners, problems the Tribune’s series “The Tax Divide” uncovered in June. Berrios, who is up for re-election next year, testified before the county board about his methods in July, and Board President Toni Preckwinkle ordered a study of residential assessments.

The new findings on commercial and industrial valuations expose many of the same flaws, with the assessor’s office generally undervaluing expensive downtown buildings while overvaluing small businesses in poorer neighborhoods.

Small business, big tax burden

In 2014, for instance, a building on Oak Street in the Gold Coast neighborhood sold for $14.9 million. The next year, the assessor’s office valued the building at $3.6 million — less than a quarter of the sales price. A year after that, in 2016, the building sold for even more: $23 million.

Eight miles west, a small industrial shop in the working-class Belmont Central neighborhood sold for $110,000 in 2015. The assessor’s estimate that year was $207,140, nearly double the sale price.

The effects of flawed commercial and industrial valuations aren’t limited to people who own businesses. Owners of residential properties, as a group, also ended up paying more in property taxes than they would have if the assessor’s office had done its work properly.

The total amount of property taxes levied in a given year is fixed, so if one group of property owners doesn’t pay its fair share, others have to make up the difference. And for years, the county has significantly undervalued commercial and industrial properties as a class, according to the ProPublica Illinois-Chicago Tribune analysis as well as studies conducted by the Illinois Department of Revenue. That means the estimated total value of those properties, after appeals, was on average less than it should have been.

The extra burden on homeowners was even greater for people who owned lower-priced properties, since the assessor already tended to overvalue them in comparison with other homes.

The assessor’s office encourages property owners to file an appeal if they are dissatisfied with an assessment. In cases where officials did not change a property’s initial estimate from one reassessment to the next, the vast majority of the owners appealed, government records show.

Seventy-four percent of those owners won reductions from the assessor — only to see the values snap right back to the same number in the next reassessment.

“There is no rationale for having no change in these initial valuations,” said Richard Almy, former executive director of the International Association of Assessing Officers. “Especially if the assessor later agreed to a reduction, there’s no earthly reason for them to go back to the same value.”

Cook County Assessor Joseph Berrios stands in line at the County Building in Chicago to file his re-election paperwork last month. He is being challenged in the Democratic primary by Fritz Kaegi and Andrea Raila. (Jose M. Osorio / Chicago Tribune)

The repetitive process feeds a property tax appeal industry that provides the bulk of Berrios’ campaign contributions. Inaccurate assessments also help drive business to political allies who are property tax attorneys, including Illinois House Speaker Michael Madigan, the longest-serving state house speaker in U.S. history, and Ald. Edward Burke, the longtime chair of the Chicago City Council’s finance committee.

The office’s deputy assessor for communications, Tom Shaer, did not explain why thousands of first-pass values were identical over multiple reassessments under Berrios. The other findings from ProPublica Illinois and the Tribune are misleading, he said, and do not “do justice to the complexity” of Cook County’s assessment system.

“The study includes five years of the real estate crash,” Shaer wrote in an emailed response. “The crash played havoc with figures in certain industry measures used for this story, making them unreliable when evaluating the assessor’s work.”

Shaer also defended the office’s reliance on the appeals process.

“Appeals of commercial and industrial property are extremely effective in giving the assessor’s office the most complete and updated information,” he wrote. “If not for the appeal process, Cook County would need hundreds of financial personnel to initially obtain that information — at a cost of more than $32 million per year.”

Cook County’s deeply flawed assessment system is a source of vexation for many commercial property owners, said Elizabeth Holland, CEO of the Chicago-based commercial real estate company Abbell Associates, which owns property all over the Midwest.

“It’s a system that we don’t see anywhere else in the country,” said Holland, a former chair of the International Council of Shopping Centers. “They are not doing an accurate job of assessing property, and I think it’s a frustration for everyone I know who owns commercial real estate here.

“It means time, effort and money because they make you hire lawyers to appeal inaccurate assessments.”

‘Not doing the work’

With more than 1.8 million parcels of property ranging from skyscrapers and bungalows to steel mills and condominiums, Cook County has one of the most complex property tax bases in the country.

For assessment purposes, most properties consist of a single parcel of real estate. But some have multiple parcels, each of which receives its own assessment and its own tax bill.

Assessing all that real estate is difficult — and time-consuming. Berrios says his predecessors in the assessor’s office failed to get the work done on time for more than three decades.

The tardiness delayed property tax bills from going out and forced taxing bodies across the county to take out loans, known as tax anticipation notes, to tide them over until property taxes came in, costing taxpayers money for interest and fees.

That changed when Berrios took office.

Despite economic upheaval and budget cuts that slashed the assessor’s staff, Berrios finished assessments on schedule, which helped other agencies get the tax bills out on time. In fending off criticism of his tenure, he’s repeatedly pointed to this feat, crediting his office for saving county taxpayers $5 million to $6 million a month in interest costs.

“Our staff is 25 percent smaller than when I took office,” he told county commissioners at the July hearing. “But we still get the job done right. The assessment cycle has been completed either on time or early six years in a row, after the previous assessors were late for 34 years straight.”

State law requires the assessor to revalue property every three years. Unlike residential properties, which are valued en masse using computer programs, the assessor’s office values commercial and industrial properties individually on spreadsheets grouped by type and neighborhood, according to interviews with current and former staff.

Doing it that way is necessary because these properties don’t sell as often as residential homes, making it harder and more time-consuming to estimate their market value.

How commercial properties are assessed The assessor’s office has refused to discuss the details, but here’s what we know. See the steps

To produce estimates as close as possible to the price a property might fetch on the open market, the assessor’s staff must gather and analyze reams of market data — including rents and expenses per square foot, sales information, vacancy rates and other indicators.

In a dynamic market like Chicago, which the assessor’s office says has about 50,000 commercial and industrial parcels, the factors that go into these complex calculations are constantly changing. So the estimated values should fluctuate as well.

But for tens of thousands of these Chicago parcels, the assessor’s office’s first-pass values did not change at all over two or even three reassessment periods, county data show.

About 20,000 commercial and industrial parcels had the exact same estimates in 2009 and 2012. Another 15,800 did not change between 2012 and 2015. And the estimates for more than 9,000 parcels were identical for all three of those reassessments.

The data was analyzed by parcel, not property, because more complex properties can include multiple parcels with different uses. For example, a building may house retail stores, office space and a garage, with each segment valued separately. Thus it’s possible for valuations in one segment to change while other segments stay the same.

It is impossible to know exactly why the duplicate estimates occurred. In January 2016, the assessor’s office denied the Tribune’s open-records request for the market rents and expenses, vacancy rates and other variables it used to calculate the value of commercial and industrial properties.

The newspaper sued the office in Cook County Circuit Court, and last December a judge ordered the assessor to turn over the records. But Berrios appealed the ruling — at taxpayer expense — so the values the office used remain secret for now.

Reports from a federal court monitor overseeing Berrios’ hiring practices, meanwhile, found some key people working inside the assessor’s office had little idea how values were determined.

In one critical department, the staff had “little to no background as to how some values are actually derived and approved,” wrote retired Circuit Court Judge Clifford Meacham in his December 2014 report.

In his early days as assessor, Berrios fired more than a dozen employees, including some of the office’s most knowledgeable and experienced workers, according to the monitor’s reports and interviews with current and former staff.

Shaer defended Berrios’ hiring decisions.

“We had done our due diligence to determine which employees could normally be replaced when administrations change,” Shaer said in his statement. “There’s often a difference of opinion when it comes to terminations.”

In interviews, experts on assessments said the thousands of duplicate estimates suggest that Berrios’ staff skipped or disregarded the calculations necessary to value those parcels.

Then, if property owners filed appeals, the estimates could be updated later. Essentially, the experts said, Berrios relied upon the appeals process to arrive at the assessor’s final valuations.

“There are 100 excuses they’ll give for not doing the work,” said Davis, the assessment expert who helped draft industry standards. “But it means they are basically coming up with values through negotiations.”

Brenda Doyle, right, and daughter, Jamilah Doyle, owners of Sweet Pea Academy day care center, play with Jamilah's children Randall, 3, and Jordyn, 4 months, at the center's playground in October. (Zbigniew Bzdak / Chicago Tribune)

A familiar pattern

The owners of Sweet Pea Academy, a day care in Chicago’s Auburn Gresham neighborhood, knew as soon as they received the first assessment notice for their one-story building that something was off.

Brenda and Larry Doyle, who started the day care with their daughter Jamilah, bought the building in 2015 for $205,000. When they received their first notice from the assessor a month later, however, the property’s value was pegged at $324,700.

“It’s ridiculous,” Larry Doyle said. “There are a lot of businesses in the area that have the same thing happening, and we’re all pissed off about it.”

Farther west, on West 79th Street, the owner of a pest control business purchased a small storefront in 2012 for $60,000. The assessor valued it at $111,028 that year. And when 2015 rolled around, the value didn’t budge.

Meanwhile, the owners of an office tower at 300 N. LaSalle Drive got much better news from the assessor. The building along the Chicago River had sold in 2014 for $850 million — at the time, the highest single-building office sale in Chicago history. A year later, the assessor valued the building at just $392 million, less than half the sale price.

It’s a pattern that’s both familiar and deeply unfair.

The skyscraper at 300 N. LaSalle Dr. sold in 2014 for $850 million — at the time, the highest single-building office sale in Chicago history. A year later, the assessor valued the building at $392 million, less than half the sale price. (John J. Kim / Chicago Tribune)

When the Tribune studied residential assessments under Berrios, the newspaper found high error rates as well as a tendency to give expensive properties a break at the expense of poorer homeowners. The same holds true for commercial and industrial real estate.

The basic method of testing the accuracy of assessments is to use properties that have sold to see how well the assessor’s estimates compare to actual market values. The analysis is called a sales ratio study because it involves dividing the assessor’s estimates by the sales prices to calculate ratios.

No assessment system produces 100 percent accurate results, so the next step is to run statistics that show whether errors fall within acceptable standards.

The most common test of accuracy is the coefficient of dispersion, or COD. It is, essentially, an error rate. For income-producing properties, the International Association of Assessing Officers sets the acceptable level of COD at 20. That means assessments are off by an average of 20 percent.

Under Berrios, the scores for commercial and industrial first-pass valuations have been as high as 133, ProPublica Illinois and the Tribune found. Though experts often allow complex jurisdictions like Cook County some leeway, they said those results are unacceptable.

The errors also have a bias. With lower-priced commercial and industrial properties, the assessor’s estimates tend to come in too high. At higher price points, assessments are often too low.

Known as regressivity, this pattern means the property tax system is unfair to people who own lower-value properties. Those taxpayers end up paying more, relative to the value of their property, than others do.

Assessing experts measure regressivity with a statistical test called the price-related differential. Here again, the assessments produced by Berrios’ office violated professional standards, the analysis by ProPublica Illinois and the Tribune found.

The assessor’s office said it does not conduct sales ratio studies for any class of property, though industry experts say doing so is standard practice. That suggests the office made little or no effort to understand how accurate its valuations were before sending assessment notices to property owners like the Doyles.

Comparing the assessor’s estimates to sale prices is more complicated for commercial and industrial properties than it is for residential homes. Some real estate investors may overpay for a property in order to gain a tax write-off or other financial benefit, for example.

Despite those nuances, however, agencies around the world — including the Illinois Department of Revenue — conduct sales ratio studies for all classes of property, no matter how chaotic the markets may be at the time.

Amid the hustle and bustle of obtaining a day care license, hiring staffers and renovating the Sweet Pea building to accommodate infants and toddlers, the Doyles said they didn’t hire an attorney to appeal their inflated assessment.

About our methods Our team conducted three analyses on assessments and appeals of commercial and industrial property in Cook County. Read the details

The result was a $14,875 tax bill that the Doyles say was difficult to pay. Had the property been valued closer to the sale price, their 2015 tax bill would have been about $5,500 less.

As it is, that bill represents 7.25 percent of the price the Doyles paid for the building, a figure known as the effective tax rate. The effective tax rate of the office tower that sold for $850 million, on the other hand, was about 2.1 percent in 2015.

For a business that is already struggling, the taxes are a huge burden. The Doyles said most of the children who attend Sweet Pea receive childcare assistance from the state, which held back payments during the budget impasse, adding to their troubles.

“We’ve been scuffling to get by,” said Brenda Doyle, who said she has worked in child care for more than 20 years. “Having that (property tax) money would be a big thing for us. We could use a new air conditioner. The roof needs to be replaced. We’d like to give our employees bonuses.”

A lucrative industry

For many commercial and industrial property owners in Cook County, appealing inaccurate first-pass assessments has become routine, helping to fuel a tax appeal industry that received more reductions under Berrios than in prior years.

A ProPublica Illinois-Chicago Tribune analysis of appeals data found that Berrios granted appeals for more than 34,000 commercial and industrial parcels in the 2012 Chicago reassessment and for about the same number again in 2015.

By contrast, former Assessor Houlihan approved only 17,596 appeals in 2009 — and that was the largest number since at least 2003.

Under Berrios, the analysis found, more than 70 percent of all commercial and industrial appeals filed with the assessor’s office resulted in reductions between 2011 and 2015, compared with 48 percent during the previous five-year period.

Every property tax assessment system requires an appeals process to ensure fairness and accuracy, and many jurisdictions across the country saw an uptick in appeals following the financial crisis, experts said. But the number of appeals in Cook County is extraordinarily high, far exceeding the total in New York, for example.

These appeals support an industry that provides more than half of Berrios’ campaign funds.

Although residential properties account for the bulk of real estate parcels in the county, commercial and industrial appeals are considerably more lucrative for the tax appeal industry because the parcels are far more valuable and the appeals more complex.

Between 2003 and 2016, the county granted more than $46 billion in reductions from $193 billion in commercial and industrial assessments, according to an analysis by ProPublica Illinois and the Tribune. The law firms that handle the appeals are paid either a retainer, a percentage of the tax savings or a combination of both.

Appeals data from the assessor’s office represents the best available means of estimating these law firms’ volume of business. The analysis examined each appeal, sought to identify the attorney and law firm that filed it, and calculated the reduction granted by the assessor.

The data set includes a small group of unique, high-value properties – about 200 – that the assessor’s office does not value in the usual way. For these “letter properties,” the office produces an estimate based on specific data requested from the owner. These initial estimates can be challenged through “re-review,” a process similar to an appeal.

About a dozen law firms account for the bulk of the appeals for commercial and industrial properties. Many of the power players in those firms are well-known in Chicago and Illinois politics.

When Illinois House Speaker Michael Madigan is not overseeing legislation moving through Springfield or deciding which politician will get his support as the state Democratic Party chairman, he works for his tax appeal law firm, Madigan & Getzendanner.

A Berrios ally, Madigan is a founding partner in the six-member firm that has filed appeals on nearly $8.6 billion in assessed value since Berrios took office in December 2010, the most of any firm, according to the appeals analysis.

From 2011 to 2016, Madigan & Getzendanner won reductions of 20 percent from the initial values of their clients’ properties, totaling nearly $1.7 billion, the analysis found.

In a statement, Madigan spokesman Steve Brown said the appeals process is crucial for property owners “seeking to exercise their constitutional right to ensure their assessment is uniform.”

“Neither this firm nor any other property tax firm play any role whatsoever in first pass assessments,” he wrote. “Rather, property tax firms get involved after the first pass assessment and represent clients.”

Brown also disputed the appeals analysis, saying the firm’s records show its appeals resulted in roughly $1 billion in reductions. However, he declined to provide any supporting information to counter the analysis of the assessor’s data.

Klafter & Burke — led by Chicago’s most powerful alderman and another Berrios ally, Edward Burke — filed appeals on more than $4.7 billion in commercial and industrial assessed values between 2011 and 2016, according to the analysis. The firm won reductions of $864.9 million, or 18 percent, the records show.

Burke did not respond to requests for comment.

Other firms have strong family ties to the assessor’s office or employ people who used to work there.

Christopher Crowley, Berrios’ chief deputy assessor, is the son of James Crowley, who is listed as a tax consultant on the website of the Crane and Norcross law firm.

That firm, which did not respond to requests for comment, filed appeals on more than $7.9 billion in commercial and industrial initial values since Berrios took office, winning reductions on 23 percent of the total assessed value, or $1.8 billion, according to the analysis.

Before joining Berrios, Christopher Crowley owned a stake in Madison Appraisal, a firm that Crane and Norcross regularly hired to do appraisals for its assessment appeals. (Unlike residential appeals, nearly every commercial and industrial appeal involves an appraisal.)

The close connections in the system leave many property owners feeling like they are forced to play along in a game set up to benefit certain players.

“In an era when we are trying to keep and attract good jobs in our communities, this system gives us a handicap,” said Ghian Foreman, executive director of the Greater Southwest Development Corporation and an industrial property owner. “We need to make sure it’s fair to all business owners, and the best way to do that is make sure the process is done right.”

Ghian Foreman, executive director of the Greater Southwest Development Corporation, says the way Cook County assesses commercial and industrial property hampers efforts to attract businesses and create jobs. (Tonika Johnson / ProPublica Illinois)

Among the clients Crane and Norcross has represented — and that Madison appraised — was the owner of the brick building on the Northwest Side that the assessor’s office valued at $13,455,132 in 2009, 2012 and 2015.

The owner, a New York investment firm, hired Crane and Norcross to file an appeal with the assessor in each of those years. Each time, Berrios’ office granted a reduction. And in each reassessment, after the reduction was granted, the number bounced right back to that initial value, $13,455,132.

The next chance Berrios’ office has to value the property comes in 2018.

Jason Grotto, who currently works for ProPublica Illinois, completed the first three installments of “The Tax Divide” as a reporter for the Chicago Tribune and is continuing the investigation as part of a Tribune-ProPublica Illinois collaboration. Sandhya Kambhampati is a data reporter with ProPublica Illinois, which is an independent, nonprofit journalism organization.

Chicago Tribune reporter Ray Long and former Tribune reporter David Kidwell contributed to this story.