Amusement Tax on Chicago Bears PSL's is Legal

Amusement Tax on Chicago Bears PSL's is Legal

  Thursday, October 10, 2013    Julie Tappendorf

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Sadly, the Chicago Bears lost to the New Orleans Saints last Sunday.  But, I do have an interesting municipal case about the Bears today involving the sale of PSLs (permanent seat licenses) and the City of Chicago's amusement tax.

 

Starting in 2002, the Chicago Bears sold "permanent seat licenses" or PSLs as a means to finance renovations to Soldier Field.  PSL's do not allow individuals to attend an event, but give the PSL owner the right to purchase a season ticket for a specific seat location.  After the City of Chicago began imposing the City's 9% amusement tax on the transfers of PSLs in 2009, a class action of PSL owners sued the City on a number of grounds, including that the tax was improperly imposed because a PSL is not an admission fee nor does it give the PSL owner any right to enter or attend an event that would fall within the definition of amusement under the City's ordinance.  The trial court ruled in favor of the City, and the class appealed. 

 

In Stasko v. Chicago, 2013 IL App (1st) 120265 (September 30, 2013), the appellate court affirmed the trial court and upheld the City's imposition of the amusement tax on the initial sale of the PSL by the Bears as well as any subsequent sales of the PSL in the aftermarket.  First, the appellate court held that the City had the authority to charge an amusement tax based on its home rule authority.  Second, the court determined that the price paid for a PSL constitutes part of the charge to view an amusement, and the fact that a second step was required to enter the stadium (i.e., purchase of a season ticket) did not take away from the fact that this was a taxable "amusement".  The court emphasized that an individual buying a PSL is paying for the privilege of viewing an amusement, and that person would not buy a PSL if it didn't intend to view a Bears game.  Finally, the court rejected the class' argument that the PSL was an unconstitutional occupation tax, since the charge is for the privilege to view an amusement, not to engage in the business of professional football. 

FYI - The Bears play again tonight, against the 0-5 New York Giants - GO BEARS!