Corporate personal property taxes have been abolished in Illinois as of January 1, 1979, but taxes for calendar year 1978 may still be collected this year, the Illinois Supreme Court ruled March 14. The court also held that "the mandate to the General Assembly to enact a replacement tax under section 5(c) of article IX continues after the tax was abolished on January 1, 1979. Although . . . such a mandate is not generally judicially enforceable, it does, nonetheless, constitute a constitutional command to the General Assembly to act, and the members of that body have by their oath sworn to support the Constitution of the State of Illinois (111. Const. 1970, art. XIII, sec. 3)."
The ruling places immediate pressure upon the General Assembly to replace the tax on personal property of corporations, including all property other than land, buildings and fixtures. Total state receipts from the corporate personal property tax are estimated to be $504 million in fiscal year 1979 and $490 million in fiscal year 1980. Much of this money goes to support vital state services, including aid to local schools, higher education, public aid and state agency operations.
Unless the 80th General Assembly acts this year, the $490 million will not be available next year. The court opinion upheld state constitutional language calling for replacement of the tax revenue "by imposing statewide taxes, other than ad valorem taxes on real estate, solely on those classes relieved of the burden of paying ad valorem personal property taxes because of the abolition of such taxes subsequent to January 2, 1979." Co-defendants of the Cook County assessor had claimed the replacement mandate could not be effective after January 1, 1979. The court^ disagreed, explaining such a ruling would allow the legislature to "accomplish the very end that the [constitutional] delegates did not want; that is, shifting of the burden of the abolished tax to another class of taxpayers."
For details of the entire personal property tax question, see Charles Minert's March 1977 Illinois Issues article, pages 18-21, which anticipated the court's decision. The decision comes in the case of Client Follow-Up Company v. Thomas C, Hynes.
YWCA building not 'special use'
The Illinois Supreme Court decided January 26 that the state needn't pay the full cost for replacing a YWCA building in Springfield, which the state condemned in order to construct a state courts complex. The court ruled that the YWCA building in the way of the courts complex should not be valued at the cost of substitute facilities, estimated at $1,611,000, but rather at "fair market value," $650,000. The YWCA had called upon the court to recognize the property as "special use," meaning that it had been adapted for unique usage, valuable only to its owners' present purpose. "The building in question is a four-story brick structure built in 1913 and rehabilitated in 1950. The building includes an indoor swimming pool, gymnasium, locker rooms, chapel, meeting room and three kitchens," according to the opinion, penned by Justice Thomas E. Kluczynski. The case, People ex rel. The Director of Finance v. Young Women's Christian Association of Springfield, may be appealed to the U.S. Supreme Court, according to the YWCA.
U.S. Supreme Court Foster care support
The U.S. Supreme Court ruled 8-0 February 22 that foster children placed by the state with relatives must be allowed the same support welfare payment as children placed in the custody of unrelated foster parents. The ruling disallows an Illinois administrative practice, shared by 12 other states, under which wards of the state placed in the homes of relatives are allotted only basic child support payments to the relatives, instead of full foster care amounts. The ruling was based upon congressional intent in writing welfare law.
April 1979/Illinois Issues/29
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