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Friday, July 18, 2014

Government Bodies Can Seek Equitable Relief when Counties Incorrectly Reduce Taxes

On July 9, 2014, the Appellate Court for the Third District decided the case of The Board of Trustees of Illinois Valley Community College District NO. 513 v. Putnam County. This case involved a reduction in real estate taxes granted by the treasurer and collector of Putnam County to a company that constructed an ethanol facility within an enterprise zone within the Village of Hennepin.  The Community College District had approved a resolution abating property taxes for the property; however, the resolution had certain restrictions and limitations based upon the timing of the construction of improvements on that property.  County officials concluded that the resolution of the Community College required a tax abatement for the facility.  The Community College District disagreed and filed a complaint seeking a writ of mandamus to require the county to stop abating the taxes and to re-issue tax bills for three previously abated tax years.  The company filed a motion to dismiss arguing that, under the property tax code, only it had the right to protest the taxation of its property.  The trial court ruled against company, and the case was appealed.  

The appellate court reviewed the tax objection provisions of the property tax code and concluded that those provisions are only intended to be used by and applied to a property tax payer who feels that a tax has not been appropriately calculated.  However, the court determined that government bodies that believe that their taxes have not been properly calculated by county officials have a completely independent right to file a lawsuit.  

Although the arguments suggested by the utility company were quite exotic and may have been proposed as a delaying tactic, this appellate court decision should prevent similar arguments being made in the future.  That decision strengthens the rights of governmental bodies to question acts taken by the county in the tax collection process even if the effect of the lawsuit would be to require a taxpayer to come up with additional funds.  The Community College correctly named not only the county, the treasurer and collector in the lawsuit, but also the energy company, which would have to pay more taxes.

Post Authored by Stewart Diamond, Ancel Glink


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