Court Opinion

ID: 9530637
Source: CourtListenerOpinion
Date Created: 2023-08-07 04:01:58.297061+00
Date Added: 2024-06-11T13:28:12.189520
License: Public Domain

JUSTICE HARRISON, dissenting: Under Illinois law, all property is subject to taxation unless specifically exempted by statute in conformity with the governing provisions of our constitution. Rogers Park Post No. 108 v. Brenza, 8 Ill. 2d 286, 289-90 (1956). Taxation is the rule. Tax exemption is the exception. Chicago Bar Ass’n v. Department of Revenue, 163 Ill. 2d 290, 301 (1994); City of Chicago v. Illinois Department of Revenue, 147 Ill. 2d 484, 491 (1992). Consistent with these principles, statutes exempting property from taxation are to be strictly construed in favor of taxation. Chicago Patrolmen’s Ass’n v. Department of Revenue, 171 Ill. 2d 263, 271 (1996). If there is any doubt as to applicability of an exemption, it must be resolved in favor of requiring that tax be paid. Van’s Material Co. v. Department of Revenue, 131 Ill. 2d 196, 216 (1989). We presume that the exemption is inapplicable (Van’s Material Co., 131 Ill. 2d at 216), and the party seeking the exemption has the burden of proving otherwise by clear and convincing evidence (see Institute of Gas Technology v. Department of Revenue, 289 Ill. App. 3d 779, 782 (1997)). The Illinois Constitution of 1970 provides: “The General Assembly by law may exempt from taxation only the property of the State, units of local government and school districts and property used exclusively for *** charitable purposes.” (Emphasis added.) Ill. Const. 1970, art. IX, § 6. Pursuant to this grant of power, the legislature has enacted section 19.7 of the Revenue Act of 1939, which exempts from taxation “[a]ll property of *** charitable organizations *** when such property is actually and exclusively used for such charitable or beneficent purposes, and not leased or otherwise used with a view to profit.” (Emphasis added.) 35 ILCS 205/19.7 (West 1992). Under section 19.16 of the Revenue Act, this exemption is extended to “[pjarking areas, not leased or used for profit, when used as a part of a use for which an exemption is provided *** and owned by any *** non-profit hospital.” (Emphasis added.) 35 ILCS 205/19.16 (West 1992). In the case before us today, the parking garage is owned and operated for the use of a nonprofit hospital and is used “as part of a use for which an exemption is provided.” There is no dispute, however, that the garage is not “exclusively used” for the hospital’s charitable purposes. Aside from the handicapped spots and some spots reserved for the employees of the company that runs the garage, every parking space in the entire structure is available for use by the general public. No affiliation with the hospital is required as a condition of admittance or use. Anyone can park there at any time for any purpose. In addition, no claim can be made that the parking areas are not “leased or used for profit” as the statute requires. The hospital charges fees for use of the parking areas in order to make money, just as it leases a portion of the structure to a fast food restaurant in order to make money. Market rates are charged to everyone except the hospital’s doctors, employees and patients, who are entitled to a discount. While it is true that the hospital’s doctors, employees and patients constitute the bulk of the garage’s users, it is also true that there is nothing to prevent the facility, as presently operated, from being used entirely and exclusively by members of the general public at market rates. Under these circumstances, I fail to see how we can say that the taxpayer met its burden of proving that the hospital’s parking garage qualifies for an exemption under the terms of the Revenue Act or the authority given by the constitution. Had the taxpayer reserved particular spaces for hospital personnel and patients, a partial exemption might be in order. But it did not. We have, instead, a situation where “the property as a whole, or in unidentifiable portions, is used both for an exempting purpose and a nonexempting purpose” and the non-exempting purpose is not “merely incidental.” Illinois Institute of Technology v. Skinner, 49 Ill. 2d 59, 66 (1971). Because no physical portion of the parking garage can be identified as having an exclusively exempt use, the taxpayer’s claim for an exemption is untenable. It is not insignificant that the Department of Revenue shares this view. Although the Department’s interpretation of the law is not binding on us, we have often said that we should accord substantial weight and deference to the interpretation of a statute by the agency charged with its administration and enforcement. See, e.g., Central City Education Ass’n v. Illinois Educational Labor Relations Board, 149 Ill. 2d 496, 510 (1992); City of Decatur v. American Federation of State, County & Municipal Employees, Local 268, 122 Ill. 2d 353, 361 (1988). In reaching this conclusion, I cannot deny that the statistical approach proffered by the taxpayer and adopted by my colleagues is not without its appeal. Had we the power to establish the system for granting tax exemptions, I might very well endorse it. But we have no such power. As I have-noted, exemptions must be expressly conferred by the legislature in conformity with the constitution. The courts cannot create or extend exemptions from taxation by judicial construction. Illinois Central Gulf R.R. Co. v. Department of Local Government Affairs, 95 Ill. 2d Ill, 119 (1983). For the foregoing reasons, I would hold that the appellate court was correct when it reversed the judgment of the circuit court and reinstated the Department of Revenue’s decision to deny the taxpayer an exemption. I therefore dissent. JUSTICE McMORROW joins in this dissent.