Geneva Community School Dist. 304 v. Property Tax Appeal Bd.

May 27, 1998

No. 2--97--0333

IN THE

APPELLATE COURT OF ILLINOIS

SECOND DISTRICT

GENEVA COMMUNITY UNIT SCHOOL ) On Petition for Administrative
DISTRICT NUMBER 304 and GENEVA ) Review from the Property Tax
PARK DISTRICT, ) Appeal Board.
)
Petitioners, )
)
v. ) PTAB DOCKET NOS.
) 95--00233--C--1 through
PROPERTY TAX APPEAL BOARD, ) 95--00251--C--1
KANE COUNTY BOARD OF REVIEW, )
and WASTE MANAGEMENT OF )
ILLINOIS, )
)
Respondents. )

JUSTICE RATHJE delivered the opinion of the court:

Petitioners, Geneva Community Unit School District Number 304
and Geneva Park District, appeal from a decision of the Property
Tax Appeal Board (PTAB) dismissing their appeal for lack of
jurisdiction. We affirm the decision of the PTAB.
The property at the center of this controversy, Settler s
Hill, is owned by the County of Kane. At present, the property is
leased to and operated by Waste Management of Illinois (WMI) as a
landfill. In 1993, the petitioners filed a mandamus action in the
circuit court of Kane County, seeking to compel the Kane County
Board of Review (Board) to assess and tax WMI s leasehold interest
in Settler s Hill. The circuit court dismissed the mandamus action
on the basis that the petitioners had failed to exhaust their
administrative remedies. The petitioners did not appeal the
circuit court s ruling.
Thereafter, the petitioners filed complaints with the Board
for both the assessment year 1995 and for an omitted property
assessment for the years 1981 through 1994. The Board held a
hearing at which all the agreements between Kane County and WMI and
its predecessors were admitted into evidence. The Board also
allowed testimony concerning the meaning of these agreements. The
petitioners position was that the agreements constituted a lease
which was taxable under section 9--195 of the Property Tax Code
(Code). 35 ILCS 200/9- 195 (West 1994).
The Board determined that WMI did not possess taxable
leaseholds of the Settler s Hill landfill but rather ' operating
agreements for a limited and public purpose and function of waste
disposal, landfill and construction of a site suitable for future
recreational use. [Citation.] The Board then concluded as
follows:
Therefore, this Board declares and finds that the complaint
claiming 'omitted' properties is without merit and denies the
request that the alleged leaseholds be listed and assessed as
omitted properties.
However, in its notice of findings, the Board stated as follows:
REASON - THE KANE COUNTY BOARD OF REVIEW HAS DETERMINED AFTER
REVIEW OF ALL THE EVIDENCE AND TESTIMONY THAT AN ASSESSABLE
LEASEHOLD DOES NOT EXIST ON SETTLERS HILL LANDFILL AND NO
OMITTED PROPERTY ASSESSMENT IS APPLICABLE.
The Board then proceeded to place a $0 valuation on the land and
improvements on the Settler s Hill property.
The petitioners then appealed the Board s decision to the
PTAB. In their letter to the PTAB notifying it of the appeal, the
attorneys for the petitioners stated in pertinent part as follows:
THIS NOT AN APPEAL OF THE EXEMPT STATUS OF THE UNDERLYING
PROPERTY. RATHER, THIS IS AN APPEAL OF THE DECISION OF THE
BOARD OF REVIEW WHICH DECISION STATED THAT THE BOARD OF REVIEW
FOUND THAT THERE WAS NO ASSESSABLE LEASEHOLD ON SETTLER S HILL
LANDFILL AND AS SUCH, NO OMITTED PROPERTY ASSESSMENT IS
APPLICABLE.
By letter dated February 1, 1996, the executive director of
the PTAB contacted the attorneys for the petitioners informing them
that the PTAB questioned whether it had jurisdiction over the
appeal and requested that the jurisdictional question be briefed by
the parties. After the parties had submitted legal memoranda, on
February 27, 1997, the PTAB issued its decision finding that it did
not have jurisdiction over petitioners appeal. In its order, the
PTAB stated:
The [PTAB] finds that it does not have jurisdiction over the
subject matter of this appeal. Although the [petitioners]
contend that this is not an appeal of the exempt status of the
property, the ultimate issue before the [PTAB] in this appeal
would be the determination of whether or not the subject
property would be exempt from real estate taxation. Section
1910.10 of the Official Rules of the [PTAB] state[s]:
'The [PTAB] is without jurisdiction to determine the tax
rate, the amount of a tax bill, or the exemption of real
property from taxation (emphasis added).
The PTAB further determined that the Board s $0 assessment was in
essence the granting or continuation of the exemption of the
property. See Highland Park Women s Club v. Department of Revenue,
206 Ill. App. 3d 447, 461 (1990).
Finally, the PTAB also found that it lacked jurisdiction over
the appeals from the years 1981 to 1994, which sought to have the
property assessed for back taxes on the basis that it was omitted
property. Since the property was exempt, it was not omitted from
the tax assessment for those years, and, therefore, there was no
duty or power on the part of the assessing officials to tax the
property for the years 1981 to 1994.
The PTAB denied the petitioners motion for reconsideration.
The petitioners bring this appeal seeking administrative review of
the PTAB s decision. 35 ILCS 200/16- 195 (West 1994); 134 Ill.2d
R. 335.
The sole issue raised on appeal is whether the PTAB erred in
determining that it lacked jurisdiction to review the Board s
decision.
Our review in this case extends to all questions of law and
fact presented by the record. An agency s findings on questions
of law are not binding on the courts; we review them de novo.
Illini Country Club v. Property Tax Appeal Board, 263 Ill. App. 3d
410, 416-17 (1994). An interpretation of a statute presents a
question of law. Illini Country Club, 263 Ill. App. 3d at 416.
The PTAB, as an administrative agency, has the authority to
construe statutory provisions in making decisions and
determinations. Lee County Board of Review v. Property Tax Appeal
Board, 278 Ill. App. 3d 711, 719 (1996). A reviewing court is not
bound by an agency s interpretation of a statute; however, the
courts will give substantial weight to the interpretation of an
ambiguous statute by the agency charged with its administration and
enforcement. Lee County Board of Review, 278 Ill. App. 3d at 719.
Such an interpretation expresses an informed source for determining
the legislative intent. Lee County Board of Review, 278 Ill. App.
3d at 719. An important reason for this deference is that agencies
can make informed judgments upon the issues, based upon their
experience and expertise. Lee County Board of Review, 278 Ill.
App. 3d at 719.
Finally, where the authority of an administrative body is in
question the determination of the scope of its power and authority
is a judicial function, not a question to be finally determined by
the administrative agency itself. People ex rel. Thompson v.
Property Tax Appeal Board, 22 Ill. App. 3d 316, 321 (1974).
However, it does not follow that an administrative body can never
determine the scope of its jurisdiction in a situation. By acting
or refusing to act, it necessarily determines that the subject
matter and its activity are or are not within the purview of the
statute creating the agency. People ex rel. Thompson, 22 Ill. App.
3d at 321. The correctness of that determination is a question of
law. People ex rel. Thompson, 22 Ill. App. 3d at 321.
The parties all agree that the Settler s Hill landfill is
exempt from taxation. The petitioners take the position that,
while the land is exempt, WMI s leasehold in the property is
taxable under section 9--195, which provides as follows:
Leasing of exempt property. Except as provided in
Section 15--55, when property which is exempt from taxation is
leased to another whose property is not exempt, and the
leasing of which does not make the property taxable, the
leasehold estate and the appurtenances shall be listed as the
property of the lessee thereof, or his or her assignee. 35
ILCS 200/9--195 (West 1994).
The Board in this case found that WMI had nontaxable operating
agreements, not leasehold interests in Settler s Hill. The
petitioners sought review of that determination by the PTAB.
The process for bringing an appeal before the PTAB is set
forth in section 16--160 of the Code. 35 ILCS 200/16--160 (West
1994). Section 16--160 provides in pertinent part as follows:
[A]ny taxpayer dissatisfied with the decision of a
board of review as such decision pertains to the assessment of
his or her property for taxation purposes, or any taxing body
that has an interest in the decision of the board of review on
an assessment made by any local assessment officer, may,
within 30 days after the date of written notice of the
decision of the board of review, appeal the decision to the
[PTAB] for review.
It is fundamental that an administrative body has only such
powers as are granted in the statute creating it. People ex rel.
Thompson, 22 Ill. App. 3d at 322. The only power and authority
placed in the PTAB by statute is to receive appeals from decisions
of Boards of Review [citation], make rules of procedure [citation],
conduct hearings [citation], and make a decision on the appeal
[citation]. People ex rel. Thompson, 22 Ill. App. 3d at 322. The
only types of appeals provided for in the statute are those by a
taxpayer dissatisfied with the assessment of his property or by a
taxing body, such as the petitioners in this case, that have an
interest in a decision of the Board on an assessment made by a
local assessment officer. People ex rel. Thompson, 22 Ill. App. 3d
at 322. The issue then becomes whether there has been an
assessment of the property in this case from which the petitioners
could properly appeal.
An exemption may be considered an assessment of $0. Highland
Park Women s Club, 206 Ill. App. 3d at 461. In that case, the
petitioners argued that language in the Code permitting the Lake
County Board of Review to revise assessments on its own motion did
not permit it to review exemptions. The reviewing court rejected
that argument on the basis that acceptance of that argument would
mean that there was no provision for review of existing exemptions.
Highland Park Women s Club, 206 Ill. App. 3d at 461. In the
present case, the Board assessed the property at $0 based upon the
fact that no assessable leasehold interest existed. However, while
the Board has authority to review exemptions, under its own rules,
the PTAB does not. See also Mead v. Board of Review of McHenry
County, 143 Ill. App. 3d 1088, 1096 (1986) (according to a 1969
opinion of the Attorney General, the granting or denying of an
exemption not subject to review by the PTAB).
The petitioners place much emphasis on the fact that they are
not challenging the status of the property as exempt. According to
the petitioners, all they seek is a review of the $0 assessment of
the leasehold, which, as the PTAB may hear appeals from taxing
bodies regarding assessments, should be within the jurisdiction of
the PTAB.
The $0 assessment in this case did not reflect that WMI s
interest in the property was not valueless but that it was not
taxable. If the issue were over the value of the property, the
PTAB would have had jurisdiction to hear the appeal because the
underlying reason for the $0 assessment had to do with the
correctness of the assessment of the property value. In the
present case, however, the concern is not the $0 assessment itself
but the underlying reason for the $0 assessment, namely, that there
was no taxable interest.
If the PTAB were to consider this appeal, it would have to
make a determination as to the correctness of the Board s
determination that WMI s interest in the property was not taxable.
While the PTAB may review decisions made by the Board on
assessments, there is no authority for the PTAB to review a
decision of the Board determining the existence or nonexistence of
a taxable interest.
We conclude, therefore, that the decision of the PTAB that it
had no jurisdiction to review the decision of the Board in this
case was correct as a matter of law.
The decision of the PTAB is affirmed.
Affirmed.
GEIGER, P.J., and BOWMAN, J., concur.