Many developers and investors of commercial/industrial real estate in Cook County are unaware of a potential financial benefit available to those who have successfully rehabilitated environmentally-impacted sites and obtained regulatory closure, with the procurement of a “No Further Remediation” (NFR) letter. This benefit is known as the “Class C” real estate tax incentive.
The Class C provisions, passed in 2011, are intended to not only offer significant tax savings, but also reduce the overall costs of the assessments and ensure a fair market appraisal value for a property that has obtained an NFR letter through the Illinois EPA’s Site Remediation Program (SRP). To be eligible, remediation costs, including those associated with subsurface testing, engineering/oversight and legal fees, must have totaled at least $100,000 or, alternatively, 25% of the real estate’s market value. Owners must also apply within one year of obtaining the NFR letter to be considered eligible.
With Class C status, properties will be assessed at 10% of their market value for the first ten years of eligibility, with increases of 5% over the next two years and options for renewals. This can enable property owners to realize considerable tax savings when compared to the normal assessed rate of roughly 25% of market value. For instance, an owner of a typical piece of Chicago industrial real estate valued at $1 million could save over $200,000 in taxes over the initial ten-year period.
Pioneer has collectively assessed over 20,000 sites since its inception in 1989, and we are proud to have tallied over 560 NFR letters for our clients through the SRP, with more being recorded every month. To find out if we can obtain an NFR letter for your site, call us at (773) 722-9200 or email at info@pioneerEES.com. For more information about Class C Tax Incentives, please visit the official bulletin at the Cook County Assessor website at http://www.cookcountyassessor.com/forms/clscb.pdf.
