A study released by a government watchdog group in Chicago last week concludes that a property tax cap that went into effect in five suburban Chicago counties last October will have a significant impact on property tax levels in that region.

The Civic Federation also found that the reduced revenue most governments will receive because of the tax cap will force them to seek "substantial economies," such as pursuing service cuts, seeking other local, state, or federal revenue sources, and considering consolidation of local governments. The cap, which was passed by the Illinois General Assembly last year, limits annual increases in property tax collections by most local governments in the counties to 5% or the rate of inflation, whichever is less.

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