By Ben Joravsky
One day last month Mary Peavy came home from work to find a form letter from a mortgage company warning that she might lose her home because of unpaid property taxes. The letter drew her into the netherworld of Cook County property-tax law, where clerks in cages give out bad advice and even the so-called experts are bewildered.
"Everything they told me turned out to be wrong," says Peavy. "They told me I hadn't been paying my taxes when they hadn't sent me the bills. They told me I owed taxes that don't even exist. I feel sorry for anyone who has to deal with any of these people--the county clerk, the county assessor, they all made a mess out of my situation. They tell you one thing and then they turn around and tell you something else."
The property in question is a modest single-family home in a working-class stretch of Roseland, on the far south side; Peavy and her ex-husband bought the house in 1971. "My husband and I were living in an apartment on 69th Street and we decided we needed a little more space," she says. "I'm kind of lingering here. My [three] children have grown. I think about selling the house and moving on, but it's paid off and I'm settled here. You sort of take your old house for granted."
She certainly didn't think she had to worry about unpaid bills. "All those years I was paying the mortgage," she says. "I paid it off in the early part of 1996. I've never been behind. I never got a notice of any kind."
But the form letter, from a mortgage company in Park Ridge, changed all that. "Dear Homeowner," it read. "A survey of the Cook County Recorder's office shows that your 1995 property taxes were sold at auction. Unpaid property taxes are a serious matter that if left unresolved could result in the loss of your property. Meanwhile, your tax purchaser is charging you 18 percent interest on the unpaid balance of your sold taxes, further eroding the equity in your home." Then came the sales pitch: "If the sold taxes have not been paid, [we] can help you! We are one of Illinois' fastest growing mortgage banking firms. We have years of experience in helping people with all types of credit backgrounds to consolidate their unpaid tax bills, credit card bills, and more!"
Somehow, Peavy realized, she had fallen behind on her property taxes, and her home had been listed at a county auction of tax-delinquent properties, where savvy operators pay off outstanding taxes so they can make high-rate loans to hard-luck home owners desperate to hold on to their houses. The letter's conclusion appeared in bold capitals: "LET US HELP YOU CATCH UP ON YOUR UNPAID PROPERTY TAXES BEFORE THEY BECOME A MORE SERIOUS PROBLEM THAT COULD RESULT IN THE LOSS OF YOUR HOME! CALL US TODAY!"
"I almost had a heart attack," says Peavy. "I'm thinking, loss of home! What are they talking about? They can't take my home. And what about that 18 percent? They can't charge me 18 percent. And what auction? I mean, I'd heard about auctions, but I didn't think they involved people like me. How come I didn't know? If I owe back taxes, how come no one told me? How can they auction off my property without telling me?"
Peavy called the office of Jim Houlihan, Cook County assessor. "It was a Friday afternoon, and the lady who answered says, 'I can't tell you anything on the phone. You have to come down here.' She was trying to be nice, but by her being so mysterious it was only making it worse, like they knew something I didn't know."
The following Monday, Peavy took a half day off work and went to the county building. Her first stop was the assessor's office. "The first lady I saw turned out to be the woman I had talked to on the phone," says Peavy. "She looked my house up on the computer and says, 'Oh, I see you owe on two sets of tax bills.' I said, 'But I only have one house.' She said, 'Well, they're charging you for two lots.' I said, 'I didn't know about a second lot--I just bought one.' She said, 'Well, your real estate attorney should have told you.' I'm thinking, 'Real estate attorney? What do you mean real estate attorney? My husband and I didn't have a lawyer when we bought this house. We were just two working-class people struggling to get a home.'
"She directed me to a cashier who asked me for $8 so she could do a computer search, and sure enough she also came up with two bills. I owed $908 for one piece of property and another $750 for the other piece of property. I kept asking, 'But why do I have two bills?' This lady didn't know. She sent me to another guy, and he told me that they have this auction twice a year for all the property that's behind on taxes. And that my back taxes were auctioned off. But don't worry, I can get it back if I pay back my back taxes. And I'm saying, 'How can you auction my property without telling me? And how come I owe on two lots when I only have one house?' He can see I'm really upset, so he says, 'You have to go talk to someone in [county clerk] David Orr's office.'"
Peavy walked down the hall to the clerk's office. "This lady tells me, 'You don't have two lots, you have a driveway, and this $908 bill is your driveway tax bill.' I said, 'A driveway tax! I never heard of a driveway tax.' She says, 'Oh yes, that's what it is--a driveway tax.'"
Putting together the bits of information she'd received from the different clerks, Peavy realized she'd been victimized by rampant computerization: "You know how it is with bills: if you don't pay them, you don't think about them. All those years my mortgage company had been paying my tax bills. Then when I paid off the mortgage, they stopped paying them. Only the county kept sending them the bills, and the mortgage company--well, I don't know what they did with those bills. Probably piled up in a warehouse or something. Now I'm getting stuck with one big bill. I had to change the addresses so the bills came to me, and I had to pay off the old bills, which included a penalty [fee] of over $150. And I had to pay for all these clerk fees to process this stuff. Isn't that something? I pay all the penalties even though they made all the mistakes. On top of all that they had me paying a driveway tax, and I don't even have a driveway. I mean, there's this unpaved little thing that leads from my garage to the street, but that's no driveway. And even if it was, whoever heard of a driveway tax? I've told this story to a bunch of people and not one of them ever heard of a driveway tax."
County officials say such mistakes, while unfortunate, happen all the time. "As far as I can tell, the county was billing the mortgage company, but the mortgage company wasn't telling [Peavy] and so the bills just accumulated," says Ryan Chew, a spokesperson for Orr's office. "Actually, the mortgage company probably doesn't even see those bills. It's all done through magnetic tape." One computer told another computer about the taxes, and then a third computer (belonging to a company that specializes in tax-delinquent property) discovered that her back taxes were available. "She's sort of lucky she got that letter from the mortgage company," says Chew. "If she hadn't, she never would've known that her bills were unpaid."
And the driveway tax--does such a beast exist?
"No, that must be a mistake. As far as I know there is no driveway tax." Nor had anyone at the assessor's office ever heard about the driveway tax. "I asked the supervisor in our [field department] and she had never heard of a driveway tax," says Maura Kownacki, a spokesperson for Houlihan. "She was being taxed on her garage, not her driveway. I understand that, if she wants to, she can consolidate the garage and the house and pay it as one, not two."
Peavy had a decision to make: she could either pay the bills--late fees, clerk costs, and interest included--or she could fight. She wanted to fight--after all, why should she or any taxpayer be held accountable for somebody else's mistake? But she also wanted to clear her name and end the matter. She decided to pay up, though she's not happy about it. In fact, the more she thinks about her ordeal, the more angry it makes her.
"They got a nerve to tell me I should have had a lawyer when they keep changing their stories," she says. "First it's a driveway tax, now it's a garage tax. Stick around and next week it will be another kind of tax. And by the way, you should see this garage they're taxing. It's just an itty-bitty old shack. I should tear it down. And they're talking about it like it's some big old garage. You have to stay on these people. They'll just send you any old bill and tell you to pay up. How many people out there are thinking they have to pay a driveway tax because some so-called expert at the county told them so? I've heard of people losing their homes at auctions, but until now I never thought it could happen to me."
Art accompanying story in printed newspaper (not available in this archive): photo by Nathan Mandell.