“No” votes leading on Mayor Brandon Johnson’s transfer tax referendum

Most Chicago voters are rejecting Mayor Brandon Johnson’s transfer tax referendum with preliminary election results counted so far Tuesday night.

Johnson’s transfer tax is one of the only non-partisan ballot measures among Tuesday’s contests for Chicago voters. The ballot question represents years of work by a coalition of nonprofits, unions and individuals and is strongly opposed by real estate industry groups. 

Opponents of the referendum were leading as the first round of election results came in Tuesday night with about 98 percent of the city’s 1,291 precincts having reported their results thus far. As of 11:17 p.m., 53.7 percent of votes counted were cast in opposition to the tax while 46.3 percent supported it.

Opponents of the measure were confident in the margin. They were worried about the transfer tax eating further into big commercial property values at an especially vulnerable time for the office market, and thus heaping more tax burden onto residential homeowners.

“When you attack downtown, when you attack the people who are contributing the most to taxes, all the sudden the market demands that changes happen,” said Cornel Darden Jr., the board president for the Chicago Southland Black Chamber of Commerce & Industry, which opposed the measure. He watched results come in at an event his organization put on at the Union League Club.

“When those changes happen, where are they going to look to keep those [public] services going? They’re going to look to the residential owners. And they’re going to raise their taxes to compensate,” he said.

At the Bring Chicago Home election results watch party held on the West Side Tuesday night, advocates, including Myron Byrd of Chicago Coalition for the Homeless, pushed back against what they called “misinformation” from real estate industry groups that framed the ballot initiative as a property tax rather than a one-time sales tax, confusing voters.

“I’m standing up here to let you know — win, lose or too close to call, we’re going to continue to fight. …We’re going to come harder, we’re going to come stronger,” said Byrd, who was once homeless himself.

Illinois Realtors, a trade group that pledged to spend $1 million to oppose the referendum at the end of January, said late Tuesday it was ready to discuss other solutions to homelessness. It spent primarily on mailers and streaming ads criticizing the measure, according to CEO Jeff Baker.

“Votes are still being counted, but whatever the result, this is not a time for celebrations,” Baker said in a statement. “Everyone in Chicago deserves housing stability — this is what the 17,000 Realtors throughout the city advocate and work for every day.”

He continued: “For our most vulnerable, our city needs a comprehensive strategy for funding and delivering the wrap-around services that are desperately needed right now. The vote on this referendum echoes the resounding sentiment we hear from Chicago’s homeowners, housing providers and small businesses, that we cannot continue to rely on real estate taxes to fund poorly conceived programs. It’s time to come together and find real solutions that provide real housing stability to everyone in our city.”

49th Ward Alderman Maria Hadden, who spoke at Tuesday’s Bring Chicago Home event, called out real estate industry groups that tried to dissuade the proposal’s sponsors in City Hall from looking at the transfer tax as a source of revenue for homeless services, saying they did not come to the table to identify another viable funding source. Instead, Hadden said, groups like Illinois Realtors put money into opposition campaigns against Bring Chicago Home.

“This is what community-led policy development looks like,” said Hadden. “This question that made it to the ballot, this ordinance that we would seek to pass at the City Council, was built from the ground up by Chicagoans.” 

The referendum needs a simple majority to pass and, if signed into law by Chicago’s City Council, would increase the real estate transfer tax imposed on sales of more than $1 million to fund services for people experiencing homelessness, including quadrupling the 0.75 percent rate the city currently charges for deals over $1.5 million.

The rate would drop to 0.6 percent for property trades less than $1 million, affecting upward of 95 percent of sales, according to organizers of the campaign, known as Bring Chicago Home. They also estimated that the tax would generate an additional $100 million in dedicated funds for homeless services each year.

The city’s Board of Elections Commissioners at midday Tuesday reported that the primary election had drawn “shockingly low turnout,” at just 12 percent of the nearly 1.7 million registered voters — including early voting and vote-by-mail ballots. Between 9,000 to 10,000 votes were coming in each hour, down significantly from election days for the last two presidential primaries in 2016 and 2020, when 16,000 to 28,000 ballots were cast per hour.

The Bring Chicago Home campaign had raised about $700K as of January 12, but a month later said that number was “in the millions.” It relied primarily on more grassroots organizing methods like door knocking, press conferences and town hall-style meetings, according to campaign spokesperson Jose Sanchez.

When the referendum first passed through the City Council last fall, local trade groups, led by the Building Owners and Managers Association of Chicago, pulled out all the stops to try to squash the proposal for a new, tiered transfer tax structure before it was put to voters.

Trade groups hired big-name attorneys who successfully argued a lawsuit in Cook County Circuit Court that the ballot question violated Constitutional law and local municipal code when it asked voters about two transfer tax increases as well as a decrease in the transfer tax on sales under $1 million in one ballot question. 

That ruling, however, was quickly overturned in the Illinois Appellate Court when Justice Raymond Mitchell said the lawsuit had been considered “prematurely” and that the matter should be decided by voters for now – not the courts. 

The trade groups appealed this ruling to the Illinois Supreme Court with a week remaining before the March 19 election, but the state’s highest court declined to hear the case. This solidified that votes on the referendum would be counted.

Sam Lounsberry contributed reporting. This is a developing story, check back for updates.