THOMAS W. KELTY, Chief Counsel,
Illinois Municipal League

"THAT'S A WINNER"

Every year certain events herald the coming of Spring. Of course, there is the changing of the weather, the greening of grass and the warming of temperatures. But there is also the return of the sounds of baseball in the Spring including St. Louis Cardinals' broadcaster Jack Buck announcing each Cardinal victory with his trademark "That's a winner!"" Another sign of Spring is the rendering of opinions by the Supreme Court from cases heard over the winter. The month of April has brought two key decisions for the benefit of municipalities to which Jack's trademark phrase "that's a winner" could be applied.

BATES V. BOARD OF EDUCATION
__ Ill.2d __, __ N.E.2d __,
__ Ill.Dec. __ (1990)

In this action, bonds issued by the Allendale Community Consolidated School District ("Allendale") were challenged by Bernard Bates ("Bates"), a taxpayer of the district. Allendale had issued bonds in 1984 to pay for safety improvements to school district buildings. When issued, the bonds bore an interest rate of 9.75% which was within the applicable rate ceiling contained in the Bond Authorization Act (Ill.Rev.Stat., 1987, Chapter 17, Paragraph 6601 et seq.). Bates filed an action contesting the validity of the bonds and asserted that the authorizing statute which permitted the issuance of bonds for the purposes employed by Allendale contained an interest ceiling which was lower than that permitted by the Bond Authorization Act. In Bates' complaint, he argued that the specific provisions of the authorizing provision in the school code superceded the general provisions of the Bond Authorization Act, and, hence, the interest rate on the bonds issued pursuant to that authority could not exceed 7.0%. The Circuit Court of Wabash County ruled in favor of Allendale and held that Allendale was authorized to utilize the Bond Authorization Act to set the interest rates on its bonds.

Therefore, the trial court dismissed the count alleging invalidity of the bonds and granted Bates' motion holding the dismissal to be in an appealable order.

On appeal, the Fifth District Appellate Court overturned the holding of the trial court holding that the interest rate ceiling contained in the school code provision did indeed apply. After the decision by the Appellate Court, the General Assembly, cognizant of the difficulty created by the Appellate Court's decision, adopted Public Act 86-4, effective June 6, 1989. That Act amended a voluminous number of bond authorization statutes to bring them in line with the holding of the . Fifth District in Bates.

Public Act 86-4 did three things to bond authorization statutes in Illinois. First, the Act retroactively validated all bonds and other instruments of payment issued by any governmental entity on or before the date of the amendatory act. This action had the effect of eliminating the invalidity created by the Appellate Court holding in Bates. Second, the Act eliminated the 7.0% interest ceiling in the bond authorization statute at issue in Bates. In conjunction with this elimination, the Act amended a variety of other bond authorization statutes to bring uniformity to their provisions authorizing interest rates as provided in Chapter 17. And, finally, the General Assembly declared its intention and interpretation of "omnibus bond acts" that were adopted prior to the adoption of Public Act 86-4. In part, the General Assembly stated that

"omnibus bond acts are and always have been supplementary grants of power to issue instruments in accordance with the omnibus bond acts, regardless of any provisions of this act that may appear to be or to have been more restrictive than those acts. . . and that instruments issued under section within the supplementary authority granted by the omnibus bond acts are not invalid because of provision of this act that may appear to be or to have been more restrictive than those acts."

(Continued on page 20)

Page 4 / Illinois Municipal Review / May 1990

(COMMENTS Continued from page 4)

In effect, the legislature was saying that the Fifth District Appellate Court was wrong in its interpretation because the legislature had initially determined that the interest rate ceilings contained in Chapter 17 were to apply notwithstanding more restrictive provisions in any other statute.

Allendale appealed the holding of the Fifth District Appellate Court during the time that Public Act 86-4 was being considered. In its consideration of the Fifth District holding and Public Act 86-4, the Court found the bonds to be valid, but found a portion of Public Act 86-4 to be invalid.

In the opinion of the Supreme Court, authored by Justice dark and filed April 18, 1990, the Supreme Court focused on the adoption of Public Act 86-4. In reviewing the curative portion of the legislation which in effect validated the bonds determined to be invalid by the Fifth District the Court stated

"as concerning curative legislation, the general rule is that the legislature may by a curative act validate any proceeding which it might have authorized in advance, provided the power be so exercised as not to infringe on or divest property rights invested interest in the parties involved. (Citations omitted) In the present case, the defect was that the bonds bore an interest rate higher than that authorized in (the School Code). At the time that the bonds were originally issued, there was nothing which would have prevented the legislature from authorizing an interest rate above 7.0%, and that which the legislature could have originally authorized it might subsequently confirm and ratify."

Stated differently, the Court held that the legislature may reach back in time and resolve a problem created by statutory scheme if the legislature had the power to create a statutory scheme which would have avoided the problem in the first instance. By taking this step, the Court validated the attempt by the legislature to cure the defect in the Allendale bonds and reinstate their validity as obligations of the school district.

The Court also addressed the legislature's attempt to reinterpret the statute in a manner contrary to the Fifth Appellate District's holding. It found that this section of the Act violated the doctrine of separation of powers. In short, that doctrine provides that each of the branches of state government (executive, legislative and judicial) is independent and no branch is permit-

Page 20 / Illinois Municipal Review / May 1990

ted to exercise powers which belong to another branch. The Supreme Court viewed the legislature's adoption of interpretive language of the previously existing law as an attempt to intrude on judicial powers. The Court comments that in our system of government, the legislature's role is to make law and the judiciary's role is to interpret law. According to the Court, "[w]hile the General Assembly can pass legislation to prospectively change a judicial construction of a statute if it believes that the judicial interpretation was at odds with legislative intent (citations omitted), it cannot affect a change in that construction by a later declaration of what it had originally intended (citations omitted)."

In summary, as the Court stated, it agreed with both parties. It agreed with the taxpayers that the legislature could not retroactively reinterpret the law to eliminate the effect of a judicial opinion. It agreed with Allendale

that the actions of the legislature had served to retroactively validate the bonds invalidated by the Fifth District. However, the most important effect for municipality was the amendment of a variety of bond authorization statutes to insure that the problem presented by Bates cannot occur in the future. By heeding the difficulty identified by the Appellate Court in Bates, the legislature undertook a comprehensive amendment of the bond authorization statutes in order to insure that the difficulty would not recur. Now, municipal issuers and their counsel can move with confidence with respect to interest rates knowing that the bond authorization act contained in Chapter 17 is the principle controlling factor in the maximum interest rate that may be charged on obligations of units of local government.

While the Bates decision was a single game, the second decision of importance to municipalities was a doubleheader. And, this decision helps to bring parity to the competing teams in the municipal labor relations league.

In City of Freeport v. Illinois State Labor Relations Board, the Supreme Court has clearly defined the standard for exclusion of supervisors from a bargaining unit. Because of the complexity of the Court's opinion, next month's edition of this column will be devoted to the analysis of this seminal decision in Illinois public labor relations law.

Another recent opinion of a lower Illinois court is worthy of note. This case applies federal constitutional standards to an Illinois curfew ordinance.

May 1990 / Illinois Municipal Review / Page 21

VILLAGE OF DEERFIELD V. GREENBERG
193 Ill.App.3d 215, 550 N.E.2d 12,
140 Ill.Dec. 530 (2d Dist., 1990)

This appellate case involves a challenge by Greenberg to the validity of the curfew ordinance of the Village of Deerfield.

Deerfield has a curfew ordinance that prohibits persons of less than 18 years of age to be present, unaccompanied by an adult, on the public street of the village during certain prohibited hours. Greenberg was charged with a violation of the Village's curfew ordinance. Based upon a stipulated plea of guilty, Greenberg was convicted and fined. The appeal was filed challenging the ordinance as invalid beyond the powers of the village and unconstitutional under the Illinois and United States Constitutions.

Greenberg argued that the ordinance exceeded the scope of powers granted to municipalities to adopt curfew ordinances. However, the appellate court quickly disposes of this argument by pointing out Paragraph 11-1-5 of the Illinois Municipal Code which specifically permits a municipality to adopt a curfew ordinance. Additionally, the court cites Chapter 23, Paragraph 2372 authorizing municipalities to adopt curfew ordinances and to increase the requirements of a curfew ordinance in excess of that provided by state statute.

However, the more important aspect of this case is the appellate court's application of the constitutional standards in Belotti v. Baird, 443 U.S. 622 (1979) in contrast to People v. Chambers, 66 Ill. 2d 36. Greenberg asserted that the decision in Belotti was inconsistent with the Illinois Supreme Court's decision in Chambers which had been decided three years previous to Belotti. Belotti outlined three standards, one of which must be met in order to justify such an ordinance. In applying the constitutional standards to the Supreme Court's opinion in Chambers, the appellate court found that although it proceeded Belotti, Chambers considered two of the three principles of Belotti and found them present in the state curfew law. First, the state curfew law was justified as a protection imposed in light of the particular vulnerability of children. According to the Illinois Supreme Court

"in legislating for the welfare of its children, the state is not required, in our opinion, to proceed upon the assumption that minor children have an absolutely unlimited right not only to choose their own associates, but also to decide when and where they will associate with them."

Second, the Illinois Supreme Court also addressed the manner in which the state curfew statute furthered the parental role in child rearing

"by providing a sanction against the parent who knowingly permits a child to violate the statute, the cooperation of the parent is commanded. That sanction may also operate indirectly to enlist cooperation from the child, who may be willing to risk getting into trouble himself, but unwilling to involve his parents in a violation of the law. Parental control is thereby strengthened."

Aside from the application of the Chambers opinion to Belotti, the other principle of importance to Illinois municipalities is the explicit approval of an increased curfew age from 17 to 18 based upon a local ordinance. The opinion clearly sets forth a summary of the at law in Illinois pertaining to curfew ordinances adopted by local municipalities. The guidelines of Greenberg provide a sound basis on which Illinois municipalities can judge their curfew ordinances. •

Page 22 / Illinois Municipal Review / May 1990