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Vacancy Fraud Bill aims to penalize landlords who take advantage of tax breaks on long-vacant properties

Small business advocates to hold town hall meeting ahead of Houses’s committee deadline to pass bill

Vacant stores with South Shore area (iStock)
Vacant stores with South Shore area (iStock)

Small business advocates are backing an Illinois state bill that aims to penalize landlords who take advantage of tax breaks for long-vacant properties.

The Woodlawn Chamber of Commerce and the Small Business Advocacy will hold a virtual town hall on the impact of the proposed Vacancy Fraud Act on Wednesday ahead of the House small business committee’s deadline to pass the bill next week, Block Chicago reported.

“We want to pass legislation that will remove the incentives for people to keep their storefronts vacant in a way that is damaging their neighbors and damaging to the community,” said bill sponsor Representative Daniel Didech.

If the bill passes it would allow taxing bodies including municipalities and school districts to file complaints with their county government if a property owner who receives vacancy tax relief isn’t actively trying to lease, sell or renovate.

The bill, introduced in January by Didech and cosponsored by Representative Carol Ammons, says that if the county review boards rule an owner committed vacancy fraud, the landlord could be forced to pay back three times the amount of tax breaks received. The landlord could also be barred from getting any vacancy tax relief for the property until it’s sold or rented.

Vacancy rates for storefronts stands at about 50 to 60 percent on all three main commercial strips in blighted communities like South Shore, according to Tony Trice, South Shore Chamber’s executive director.

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Landlords would have to show they are actively looking for tenants, said Trice. “This has to be done with more than just a ‘For Rent’ sign in the window. We need some legitimate proof that they are working to improve these projects in our communities,” said Trice.

Motivating “bad players” into communicating with potential tenants and buyers about their plans for vacant shops as well as opening up county review boards to lawsuits from property owners are concerns raised by some members of the House small business committee and chambers of commerce.

The pandemic caused a “huge increase in vacancies” and “some degree of vacancy is going to be part of any healthy business district.” said Cook County Assessor Fritz Kaegi’s office.

The bill passage won’t be a total fix for crippling high vacancies, small business advocates say. But zoning changes that allow more flexibility in renovations and city grants for business improvements will be important approaches for filling empty shops.

“You have to have a vested interest and it’s not just about the bottom line, it’s about the quality of life,” Trice said. “Residents that live here understand it better than anyone.”

[Block Chicago] – Connie Kim