Judicial Rulings

Illinois Supreme Court Special tax treatment ends
SINCE 1851, when the state legislature chartered the Illinois Central Railroad Company, the 705.5 miles of "charter line" have been subject to a special 7 per cent gross revenue tax in place of all other state and local taxes, and the special treatment continued to be accorded to a new corporation — the Illinois Central Gulf Railroad Company — which took over from the old 1C in 1972. This special treatment has now been ended by the Supreme Court. In a decision April 5 written by Justice Moran, Snow v. Dixon, the court held that the arrangement created by the old charter does not extend to the new corporation.

As a result, the state will lose $5.6 million per year in charter tax revenues, but it will receive additional amounts from the new corporation in income, sales, and other state taxes — since the company was exempted from all other state taxes. Perhaps more important, the charter line properties will be subject to local property taxation. How much new revenue will come in to replace the lost charter tax money nobody knows.

The charter line was completed in 1856 and at that time was the longest railroad in the world. It ran from Cairo north to DuQuoin and Centralia, forking at Centralia. A northwest fork ran through Decatur, Bloomington, LaSalle, Dixon, Freeport and Galena. The other fork ran to Urbana (now Champaign), and Chicago.

Under Illinois property tax law, railroad operating properties are appraised by the state Department of Local Government Affairs as a unit. This value is next allocated among the counties through which a railroad operates and placed on local tax rolls. In the case of ICG, this was done in the past for its 1,820 miles of non-charter lines. Now the court has instructed the department to revalue the ICG operating properties, going back to the 1973 tax year and including the charter lines. This may cause some adjustment of back taxes, and the railroad is to be given credit for the tax already paid to the state. But effective for property taxes payable in the future, counties along the charter line can count on a new tax source. The right to annoy
A PROVISION in the Illinois Criminal Code which makes it unlawful to make annoying telephone calls was held unconstitutional by the Illinois Supreme Court, which said the provision was in derogation of the constitutional guarantee of free speech in the First Amendment of the federal Constitution.

The section was as follows: "A commits disorderly conduct when he knowingly . . . with intent to annoy another, makes a telephone call, whether or not conversation thereby ensues." The decision in People v. Klick, written by Justice Moran, was delivered April 5.

"The legislature cannot abridge one's first amendment freedoms merely to avoid slight annoyances caused to others," the court said. The section by its very terms would proscribe any call made with intent to annoy, regardless of its purpose or nature It would daily subject countless callers to the stigmatization of the criminal process at the election of their listeners who might perceive the call as having been made with the intent to annoy."

Court briefs
Unlawful solicitation on residential sales
AN ILLINOIS LAW intended to prevent "blockbusting" or "panic peddling" of residential property in areas where racial changes may be occurring forbids unlawful solicitation to sell after the person soliciting has been notified that the owner does not desire to sell. This section was upheld by the court as constitutional in an opinion by Justice Goldenhersh handed down March 23 (People v. C. Betts Realtors, Inc.). In other opinions the same day the court:

— Held that the Chicago Employers' Expense Tax Ordinance does not apply to insurance companies because the legislature had exempted insurance companies from fees and taxes levied by home rule units such as Chicago (Prudential Insurance Co. v. Chicago).

— Upheld the constitutionality of the Chicago Transaction Tax Ordinance against charges that it is discriminatory (Williams v. Chicago, Gorman v. Chicago).

— Upheld the action of the Illinois Department of Public Aid in denying medical assistance to a woman whose husband was employed full-time (Sweet v. IDAP). "The apparent unfairness of the situation in the case now before us results in large degree from the fact that the plaintiffs husband was employed at a very low wage," the court said. "In our opinion, it was not a constitutional requirement that the AFDC [Aid to Families with Dependent Children] and medical assistance programs be structured in such a manner as to remedy the problem of inadequate wages in addition to the stated goals of those programs."

— Upheld the constitutionality of the mandatory parole provisions in the Unified Code of Corrections (People v. Scott, Wasson v. Stafford) and provisions in the same code that establish parole eligibility for juvenile offenders and authorize the Department of Corrections to release prisoners under furlough, work release, day release and authorized absence programs (People v. Williams). In both cases, the contention had been advanced that these provisions infringed on the sentencing powers of the judiciary.

28 / June 1977 / Illinois Issues