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UNITED STATES v. STATE OF ILLINOIS

January 10, 1975

UNITED STATES OF AMERICA, PLAINTIFF,
v.
STATE OF ILLINOIS ET AL., DEFENDANTS.



The opinion of the court was delivered by: Wise, Chief Judge.

MEMORANDUM OPINION

On October 3, 1974, the United States of America instituted this action on behalf of military personnel stationed at Chanute Air Force Base in Rantoul, Illinois who reside in mobile homes located in Champaign County, Illinois. The plaintiff seeks from this Court: (1) a declaratory judgment that the provisions of Section 514 of the Soldiers' and Sailors' Civil Relief Act, as amended, 50 U.S.C.App. § 574 (1970), bars the application of the Illinois Mobile Home Privilege Tax, Ill.Rev.Stat. ch. 120, §§ 1201-1210 (1973), to United States military personnel who are not legal residents (domiciliaries) of the State of Illinois and who are absent from their home states and stationed in Illinois solely by reason of military orders; (2) an order permanently enjoining the defendants, primarily the States Attorney and local tax officials of Champaign County, from pursuing pending collection activities against such nonresident servicemen who had failed to pay the mobile home tax; and (3) an order permanently enjoining the defendants from future application of the Illinois Mobile Home Privilege Tax to nonresident military personnel living in mobile homes within Champaign County. On October 4, 1974, this Court entered a Temporary Restraining Order preventing the defendants from pursuing their collection activities against nonresident servicemen in State court and from applying the provisions of the mobile home tax to such nonresident military personnel during the pendency of this action.*fn1 That Order was extended by this Court on October 11, 1974, and modified to allow defendants to enforce the registration provisions of the mobile home tax, Ill.Rev.Stat. ch. 120, § 1204. Both sides filed cross motions for summary judgment in support of their respective positions pursuant to Rule 56 of the Federal Rules of Civil Procedure.

Jurisdiction

This Court retains jurisdiction on the grounds that this is a civil suit brought by the United States seeking declaratory relief. 28 U.S.C. § 1345, 2201. The defendants claim that the United States is not a proper party plaintiff in this action and that jurisdiction is barred by 28 U.S.C. § 1341, which provides:

  "The district courts shall not enjoin, suspend
  or restrain the assessment, levy or collection
  of any tax under State law where a plain, speedy
  and efficient remedy may be had in the courts of
  such State."

However, the law is clear that § 1341 places no limitation on the right of the United States to sue as plaintiff in federal district court on behalf of United States servicemen. Sullivan v. United States, 395 U.S. 169, 170, 89 S.Ct. 1648, 23 L.Ed.2d 182 (1969); Department of Employment v. United States, 385 U.S. 355, 358, 87 S.Ct. 464, 17 L.Ed.2d 414 (1966); United States v. Arlington County, 326 F.2d 929, 931 (4th Cir. 1964).

The Merits

The facts are not in dispute. The Illinois Mobile Home Privilege Tax was enacted into law on August 28, 1973 (Pub.Law 78-375). Shortly thereafter, the Champaign County tax assessors began to assess the tax against Air Force personnel, residents and nonresidents alike, who owned and occupied mobile homes and who were stationed at Chanute Air Force Base in Rantoul, Illinois. The primary issue in this case is whether or not the provisions of the Soldiers' and Sailors' Civil Relief Act bar the defendants from imposing the Illinois Mobile Home Privilege Tax on nonresident military personnel residing in Champaign County, Illinois solely in compliance with military orders.

I.

The Illinois Mobile Home Privilege Tax Act requires the owner of an inhabited mobile home located within Illinois to file a registration form*fn2 with the local or county assessor's office within thirty (30) days of initial placement within the particular township or county, providing, among other things, the name and address of the owner, the number of occupants, the location of the unit, its year of manufacture, and its size in terms of square feet of floor space. Ill.Rev.Stat. ch. 120, § 1204. Within sixty (60) days of registration, the county clerk computes the owner's annual tax at a rate of fifteen cents per square foot (Ill.Rev.Stat. ch. 120, § 1203), allowing a credit for the same tax paid elsewhere in Illinois by the owner for that current tax year (July 1 — June 30) and/or reducing the annual rate by one-twelfth for each month between the annual billing date of July 1 and the month in which the mobile home is located in the county. The tax must be paid to the county treasurer within thirty (30) days after mailing, and the revenues are, in turn, distributed "to the local taxing districts within the boundaries of which such mobile homes are located, in the same proportion as the property taxes collectible for each such taxing district in the prior year." Ill.Rev.Stat. ch. 120, § 1206. Failure to pay the tax when due results in a tax lien upon all present and future property of the owner acquired within the next ten (10) years or until the tax is paid, whichever occurs first. Ill.Rev.Stat. ch. 120, § 1208. Furthermore, interest on delinquent taxes is assessed at a rate of one percent per month — plus fifty per cent of the deficiency upon a finding of tax fraud. Ill.Rev.Stat. ch. 120, § 1209.

Section 514 of the Soldiers' and Sailors' Civil Relief Act, 50 U.S.C. App. § 574, was enacted by Congress to protect members of the armed forces from multiple taxation of their income and personal property in cases where servicemen were stationed outside of their states of legal domicile. The act provides, in pertinent part:

  "(1) For the purposes of taxation in respect of
  any person, or of his personal property, income,
  or gross income, by any State, . . . such person
  shall not be deemed to have lost a residence or
  domicile in any State . . . solely by reason of
  being absent therefrom in compliance with
  military or naval orders, or to have acquired a
  residence or domicile in . . . any other
  State . . . while, and solely by reason of being,
  so absent. For the purposes of taxation in respect
  of the personal property . . . of any [serviceman]
  by any State . . . of which such person is not a
  resident or in which he is not domiciled, . . .
  [his] personal property shall not be deemed to be
  located or present in or to have a situs for
  taxation in such State. . . . Where the owner of
  personal property is absent from his residence or
  domicile solely by reason of compliance with
  military or naval orders, this section applies with
  respect to personal property, or the use thereof,
  within any tax jurisdiction other than such place
  of residence or domicile, regardless of where the
  owner may be serving in compliance with such
  orders. . . ." 50 U.S.C. App. § 574(1) (Emphasis
  added).

This language is clear and unambiguous. The act reserves the right to tax a serviceman "in respect of personal property" to his state of legal residence by withdrawing the jurisdictional basis for such taxation from the State in which the serviceman is stationed.

The Supreme Court has directed that the Soldiers' and Sailors' Civil Relief Act be liberally construed "to protect those who have been obliged to drop their own affairs [and] take up the burdens of the nation." Boone v. Lightner, 319 U.S. 561, 575, 63 S.Ct. 1223, 1231, 87 L.Ed. 1587 (1943). In Dameron v. Brodhead, 345 U.S. 322, 73 S.Ct. 721, 97 L.Ed. 1041 (1953), the Court rejected the contention that ยง ...


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