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August 9, 2019
State and Local Tax
This Week
Illinois General Assembly
The House and Senate have adjourned until the fall veto session. The first day of the veto session is scheduled for October 28.
Rulemaking
The August 9 edition of the Illinois Register did not contain any proposed or adopted rulemakings by the Illinois Department of Revenue or the Department of Commerce and Economic Opportunity.
Court cases
One "rule 23" decision of the appellate court may be of interest. This case is another in a series of actions by Cunningham Township to challenge the property tax exemption status of hospitals. (Cunningham Township has the same boundaries as the City of Urbana. It is one of the multitude of overlapping taxing jurisdictions in Illinois.) The case is interesting from a procedural standpoint.
In
Cunningham Township v. Hamer, the township filed a complaint for administrative review of an order by former Revenue Director Hamer dismissing the township's request for a hearing on the granting of property tax exemptions to Presence Covenant Medical Center. The township also alleged that the provision of the Property Tax Code that was the basis of the grant of the exemption is unconstitutional on its face.
At the time this case was filed by Cunningham Township, the hospital charitable property tax exemption under Section 15-86 of the Property Tax Code had been held unconstitutional by an appellate court in
Carle Foundation v. Cunningham Township, 2016 Ill. App. (4th). However, subsequently the Illinois Supreme Court addressed, and upheld, the facial constitutionality of the hospital charitable property tax exemption statute in
Oswald v. Hamer, 2018 IL 122203
In the current case in the circuit court, Presence moved for dismissal of the township's complaint contending that the township could not pursue an administrative review because it was not a party to the administrative review proceedings. The court granted the motion and dismissed the case.
Presence sent notice to 5 taxing districts of its intent to file an application for property tax exemption for 68 parcels. The township did not receive a notice. The Board of Review recommended granting the exemptions, and the Department of Revenue granted the exemptions.
Subsequently, the township sent a letter to the Department of Revenue requesting a hearing on the applications for exemption. Presence filed a motion to dismiss contending that the hearing request was untimely, noting that the township did not intervene with the Board of Review or the Department of Revenue before the Department issued its decision.
The township argued that Presence should have provided notice to the township, and the township only learned of the exemption requests when it received notice of the exemptions from the township.
Presence contended, and the Department's hearing officer agreed, that the statute that required it to provide notice to taxing bodies did not require it to provide notice to the township.
The appellate court upheld the dismissal of the case without addressing whether Presence was required to provide notice of the filing of the exemption requests to the township. The court noted that in administrative review cases, the appellate court generally reviews the decision of the agency rather than that of the circuit court. However, the appellate court noted that in this particular case, the circuit court dismissed the township's complaint for administrative review. The circuit court did not enter an order affirming or reversing the administrative hearing decision of the Department of Revenue.
The appellate court noted that on appeal, the township did not address the circuit court's dismissal of its administrative review action. The township only argued that the Department of Review administrative hearing decision was improper.
The appellate court explained that the township did not argue any basis for reversing the circuit court's dismissal. Therefore, the township failed to establish any basis for reversal of the circuit court and the appellate court upheld the circuit court's dismissal.
Tax Tribunal
No new decisions were posted this week. None of the new cases filed with the Tribunal raises unique issues.
Publications
The Illinois General Assembly Commission on Government Forecasting and Accountability issued its Monthly Briefing for the Month Ended: July 2019
The Illinois Department of Revenue activated a link on its website to the
2019 Illinois Tax Amnesty Program. As of today, there is nothing substantive on the webpage, but it appears that this page will be the launch point for additional information when posted by the Department.
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