Chicago City Hall lobbyist repays $96,000 in tax breaks Sun-Times showed he never should have been given

Over the past seven years, Armando Saleh, a former Cook County official who's now a City Hall lobbyist, asked for and was granted nearly $55,000 in tax breaks on a pair of two-flats because the county assessor’s office wrongly signed off on 34 tax breaks he never should have gotten.

Now, after a Chicago Sun-Times investigation uncovered the improper tax breaks, Saleh has paid up — $96,000 including penalties and interest.

Saleh, a registered lobbyist for PepsiCo, won’t talk about why he repaid the money he saved as a result of the 34 tax breaks he’s gotten since 2017, along with the penalties and interest, and chose not to fight to prove he should have gotten them.

“He’s paid the money, and he’s moving on,” says Saleh’s attorney Ricardo Meza, who formerly served as the state of llinois’ executive inspector general, ferreting out corruption.

Each year, Saleh filed applications for a homeowner’s exemption, a senior citizen exemption and a senior assessment freeze on each of his two-flats. He signed the applications, attesting that neither he nor his wife had applied for a homeowner's exemption on any other property.

And Cook County Assessor Fritz Kaegi and his predecessor Joseph Berrios approved each of those applications even though state law spells out that a homeowner can be eligible for those exemptions on only a primary residence — one property, not two.

That was until the Sun-Times found last fall that Saleh, as well as other Cook County homeowners, were getting tax breaks on multiple properties, apparently in violation of the law.

Beyond that, Saleh, who’s 54 years old, wasn’t even old enough to qualify for two of the tax breaks he filed for and was given each of those six years on both properties — the senior exemption and the more lucrative senior assessment freeze. You have to be at least 65 to qualify for either of those tax breaks, which Kaegi and Berrios approved anyway.

Presented with the Sun-Times findings, Kaegi ordered a review of the property tax exemptions and decided that Saleh and nine other homeowners had wrongly applied for and gotten them.

Each was sent a letter, ordering them to pay up for what the assessor’s office calls erroneous exemptions, with penalties and interest on top of the money they should have paid in the first place.

If they wanted to fight that finding, they could ask for a hearing.

Saleh paid up. He sent Kaegi a check for $96,327.93 for the back taxes he owed and the penalties and interest.

Six other homeowners have requested hearings.

Among them is Jill Fitzgerald, who was told she had to pay $294,889 for tax breaks she got on her lakefront mansion in Winnetka because Kaegi believes that her income exceeds $65,000 a year — the maximum allowed to qualify for the senior assessment freezes that she put in for and that the assessor’s office has been giving her for years.

Criminal prosecution an option

Illinois law says homeowners who falsely apply for property tax breaks could face criminal prosecution.

In Saleh's case, Kaegi’s office says it hasn’t decided whether to ask Cook County State’s Attorney Eileen O’Neill Burke to determine whether he broke the law and should be charged with any crime for having repeatedly submitted applications for exemptions he was ineligible for and shouldn’t have gotten. O'Neill Burke’s office says prosecutors won’t look into the case unless Kaegi asks them to.

“On prior occasions, we have provided the state’s attorney’s office with information about cases where more significant fraud may have occurred,” Kaegi spokesman Christian Belanger says. “In this instance, we are still engaged in internal discussion about whether to refer the case" to the state’s attorney.

In November, the Sun-Times reported that Saleh and his wife were only in their 20s when they first applied for and were granted the senior assessment freeze on their home on South Troy Street in 1995 from then-Cook County Assessor James Houlihan. At the time, Saleh was chief of staff to Joseph Mario Moreno, who was then on the Cook County Board.

In 2003, county records show, Saleh and his wife also started taking a senior freeze tax break on a second two-flat.

Though government records show Saleh and his wife applied for and wrongly were granted some of their tax exemptions for more than two decades, Belanger says that, under the law, the assessor can’t demand that they pay back any wrongful tax breaks beyond the past six years.

Saleh is now registered as a lobbyist at City Hall for PepsiCo, and had been on the board of the Civic Federation, a nonprofit organization that acts as a watchdog on government spending and taxes. Saleh is no longer on the Civic Federation board.

All pay more for others’ tax breaks

For decades, Illinois legislators have approved a variety of programs allowing different groups to get exemptions that reduce their property taxes on their primary residences. There are tax exemptions for homeowners, seniors, veterans and people with disabilities. Some of the programs typically cut a homeowner’s property taxes by a few hundred dollars a year. Others, like the senior freeze, can be far more lucrative. Under one of the tax breaks, disabled veterans can qualify to pay no property taxes at all.

Each of the tax breaks appeals to a segment of the population that legislators count on to get elected and reelected. But there’s a tradeoff: When homeowners get a break that allows them to pay less in property taxes, that means other homeowners and business owners that don’t get those breaks have to pay more to ensure that government agencies get the money they need to operate.

It’s left to each county assessor to monitor the programs to ensure that homeowners actually qualify to get the tax breaks, which are allowed for their principal residence. People have been caught taking the benefits on multiple properties, including vacation homes in other states.

It’s a big job for Kaegi’s office to monitor the hundreds of thousands of residential properties in Cook County to verify that everyone applying for tax exemptions qualifies.

Kaegi’s office points out that, since January 2019, shortly after he took office, succeeding Berrios, the assessor’s office has ordered 11,447 property owners, including Saleh, to pay a total of $42.8 million for erroneous tax breaks, penalties and interest.

Three-quarters of those property owners — 8,358 owners — repaid $26.7 million in real estate taxes that Cook County Treasurer Maria Pappas then distributed to various governmental agencies. Kaegi’s office keeps the penalties and interest.

Kaegi's staff says it can't explain what happened to the tax breaks they tried to collect from the other 3,089 property owners but that, in some cases, hearing officers decided the tax breaks were legitimate and didn't need to be repaid.

The assessor has filed liens against 891 of those property owners, including two whose cases the Sun-Times exposed five years ago.

One of those cases involves Mary Lou Aguilar, who was ordered to repay $90,552 in homeowner and senior tax breaks she got between 2014 and 2019, when her apartment building on South Racine Avenue was owned by a business controlled by her grandson. The business wasn’t entitled to get those tax breaks.

No one charged for dead mobster’s tax breaks

The other case involves the estate of Joseph Lombardi, a convicted mobster. He died in 2013 — but the assessor kept awarding senior freeze tax breaks on the property until 2019 because someone kept applying for the tax break, signing Lombardi’s name. Kaegi filed a lien to recover $16,271 in taxes and referred the case to the state’s attorney. No charges were ever filed in that case.

Kaegi is trying to collect $954,972 in taxes, penalties and interest for what his office found were erroneous homestead and senior citizen exemptions his office awarded in 2021 to four assisted-living facilities operated by Brookdale Senior Living Solutions in Lincoln Park, Des Plaines, Glenview and Hoffman Estates.

Brookdale has never gotten any of those notices to repay the money, according to the company’s lawyer, who says the tax problem was caused by Kaegi’s office having granted more exemptions than the company even asked for. Kaegi hasn’t filed any liens against Brookdale.

Brookdale discovered the error and reported it to Kaegi’s office, according to its lawyer, who says the company shouldn’t be assessed penalties and interest for the assessor’s mistakes.

Kaegi is trying to recover $318,043 from the Des Plaines facility, whose attorney says the company requested 178 homeowner exemptions and 178 senior exemptions, though the assessor’s office gave them 225 homeowner exemptions and 335 senior exemptions.

At Brookdale’s 248-unit facility in Lincoln Park, the attorney says the assessor gave the company 295 homeowner exemptions and 400 senior exemptions.

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