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A bill introduced by state Representative Robert Martwick (D-19) is designed to help commercial districts that have landlords who do little to lease vacant storefronts.

The Milwaukee-Lawrence commercial district in Jefferson Park is an example of the problem, according to testimony at a recent state hearing on the proposed Vacancy Fraud Act. In some instances the front windows of a building have been left covered with paper while an unlicensed business operated through the back door.

Martwick said that the legislation is aimed at landlords who abuse the system by not making an earnest effort to lease their property and who instead file for a vacancy reduction on their property assessment. "Alderman (John) Arena and some members of my community brought this to me 3 years ago," Martwick testified.

The relief can serve as an incentive to keep the property vacant, according to Martwick. It reduces an annual property tax bill by more than half in some instances, and there are no limits on the number of years that a commercial landlord can receive the relief.

At the hearing, Arena gave an example of a building at 4766 N. Milwaukee Ave. in which the owner received a partial or total vacancy reduction on the assessment in 2009, 2010, 2012, 2013 and 2014. In one of those years, the reduction of the property assessment reduced the tax bill from about $12,400 to $5,000, Arena said.

Curious why the storefront had been vacant for years, Arena called the phone number on the "for rent" sign inquiring about the space.

A building representative eventually quoted $2,400 a month for a 600-square-foot space at the front of the building, significantly higher than the typical rent of $1 per square foot in Jefferson Park, Arena said.

Arena said that while the building appeared empty from the street, he later learned that the rear of the building housed a carpentry business and rehearsal rooms for bands and that there was a small apartment on the second floor. A year before Arena became an alderman in 2011, the city Law Department contacted the building owner about possible licensing or zoning issues, but no citations were issued.

The building was later cleared out and converted into a theater for a local performing arts company, but despite the positive outcome, other problems persist in the area, Arena said.

Two other properties in the 4700 block of North Milwaukee have been approved for vacancy relief seven times since 2007, and another building on the block received relief even though an illegal manufacturing business operated in it.

Members of the Portage Park Chamber of Commerce and Portage Park Neighborhood Association also testified about vacancy issues in the commercial area at the hearing.

Several legislators said that they were not aware that vacancy relief was an option for property owners, and they asked Martwick to investigate whether it is available in all counties in the state.

Under the bill, a taxing body could file a complaint with a county board of review, prompting an investigation, and violators could be required to pay three times the amount of taxes that they would have had to pay before receiving the vacancy reduction.

The legislation is not designed to eliminate vacancy tax relief, Martwick said. The relief encourages investment in blighted areas and in places where it could take time to assemble properties for a redevelopment project, he said.

The bill is in the House Rules Committee, and at Martwick’s request, the House Revenue and Finance Committee conducted a preliminary hearing on the proposal. Some changes in the legislation are being considered to address concerns raised by the Illinois Realtors.

Editor’s Note: Nadig Newspapers’ publisher Brian Nadig is the president of the Jefferson Park Chamber of Commerce, and he testified at the hearing on the vacancy problem in Jefferson Park.