With the enactment of Public Act 88-132, the Legislature has authorized Illinois municipalities to exempt other units of local government and school districts operating within the municipal borders from public utility taxes. Effective January 1, 1994, the new law amends section 8-11-2 of the Municipal Code and section 10 of the Public Utilities Act.

For those park districts in municipalities that impose such taxes, the tax relief which this legislation makes possible is neither mandatory nor automatic. It may be necessary for park districts and other potential beneficiaries to issue an official request to the municipal authorities. Whether to act upon the request is a discretionary matter. If the municipality decides to act upon the request, the exemption should be established for a specified period by a duly approved ordinance. This simplified process replaces previous methods available to special districts to avoid municipal utility taxes, such as separate rebate agreements or negotiations through intergovernmental cooperation.

Park districts are encouraged to pursue this exemption possibility. Of course, the effects will vary from district to district, but some districts may save substantial sums of money every year on their electricity, gas and telephone bills. Some critics have charged that there is at least a hint of double taxation when local governmental units must levy a tax to help pay for the utility tax due to the municipality. Therefore, any park district request for exemption would carry considerable popular support.

Gerald Brooks and Larry Trombino represent James, Brooks, Adams & Tarulis, a law firm in Naperville serving park districts and other local units of government.

14 • Illinois Parks & Recreation • March/April 1994