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Town of Cicero v. Fox Valley Trotting Club





Appeal from the Circuit Court of Cook County; the Hon. Arthur L. Dunne, Judge, presiding.


Rehearing denied December 2, 1976.

This is a direct appeal, pursuant to our Rule 302(b) (Ill. Rev. Stat. 1973, ch. 110A, par. 302(b)), from a judgment of the circuit court of Cook County granting plaintiff's motion for summary judgment.

Pursuant to its authority as a home rule unit under article VII, section 6(a), of the 1970 Constitution (Ill. Const. 1970, art. VII, sec. 6(a)), plaintiff, the town of Cicero, enacted an ordinance levying a "Municipal Admission Tax," effective December 17, 1971. This ordinance (hereinafter referred to as the Ordinance) imposed a tax upon all amusements within the town of Cicero at the rate of 10 cents for each person witnessing, participating in or entering the grounds or enclosure of a place of amusement or entertainment. Defendants, Fox Valley Trotting Club, Inc., Chicago Downs Association, Inc., and National Jockey Club, Inc., are Illinois corporations licensed and engaged in the business of conducting thoroughbred and harness racing meets at Sportman's Park racetrack, which is wholly located within the municipal boundaries of the town of Cicero.

Plaintiff filed suit against defendants, alleging that, on or about September 28, 1974, agents for defendants advised plaintiff that defendants would no longer pay the admissions tax imposed by the Ordinance. Plaintiff also alleged that defendant Fox Valley Trotting Club, Inc. (hereinafter referred to as Fox Valley), had refused to pay a tax of $56,097.30, due and owing as of September 7, 1974. Accordingly, plaintiff sought a declaratory judgment that the Ordinance was valid and applicable to defendants. In addition, plaintiff requested a declaration that certain provisions of the Illinois Horse Racing Act (Ill. Rev. Stat. 1973, ch. 8, par. 37j1) and the Illinois Harness Racing Act (Ill. Rev. Stat. 1973, ch. 8, par. 37s.19) were void insofar as they purported to bar plaintiff from levying the tax in question. Lastly, plaintiff sought an order directing the defendants to pay the tax and a judgment against Fox Valley in the amount of $56,097.30.

Defendants joined in filing a motion to dismiss, and plaintiff filed a motion for summary judgment. The trial court denied the defendants' motion and granted that of plaintiff in all particulars, except that the court reserved ruling as to the amount of the monetary damages to which the plaintiff might be entitled. Defendants have appealed, praying that the judgment of the trial court be reversed and that the Ordinance be declared unconstitutional and void.

The trial court's judgment order was entered on June 2, 1975. At that time, the Illinois Horse Racing Act (Ill. Rev. Stat. 1973, ch. 8, par. 37a et seq.) and the Illinois Harness Racing Act (Ill. Rev. Stat. 1973, ch. 8, par. 37s et seq.) contained provisions barring local governmental units from levying various taxes and fees (Ill. Rev. Stat. 1973, ch. 8, pars. 37j1, 37s.19). Subsequently, the General Assembly enacted Public Act 79-1185 (Laws of 1975, at 3690). This act, which became effective January 1, 1976, repealed the Illinois Horse Racing and Harness Racing Acts (hereinafter referred to as the Racing Acts) and substituted thereby the Illinois Horse Racing Act of 1975. Section 27(f) of Public Act 79-1185 provides in pertinent part:

"[A]ny municipality that has a Racing Board licensed horse race meeting at a race track wholly within its corporate boundaries may charge a local amusement tax not to exceed 10 cents per admission to such horse race meeting by the enactment of an ordinance." (Laws of 1975, at 3713.)

When viewed against the background of the preceding factual recitation, it becomes evident that the General Assembly, through enactment of Public Act 79-1185, has now authorized the precise tax which plaintiff has sought to levy against the defendants.

Were the only issue in this case the present validity of the ordinance in question, we would judge the Ordinance in light of the General Assembly's passage of Public Act 79-1185. (Rios v. Jones, 63 Ill.2d 488, 494-95; Illinois Chiropractic Society v. Giello, 18 Ill.2d 306.) However, the trial court made a finding that the defendants were liable for taxes assessed from the effective date of the Ordinance. By arguing that the plaintiff had no authority to adopt the Ordinance, defendants by implication challenge the propriety of that finding. Moreover, the trial court reserved ruling as to the amount of monetary damages to which the plaintiff might be entitled. Consequently, it becomes necessary for us to determine whether plaintiff was authorized to levy this tax as of December 17, 1971, the effective date of the Ordinance.

We consider first the defendants' contention that the State has preempted the field of horse racing, thereby precluding any local enactments in that same area. Defendants concede that provisions in the Racing Acts which bar local taxation of racing licensees are ineffective to defeat an otherwise valid exercise of home rule authority, since both acts antedated the effective date of the 1970 Constitution. (See Mulligan v. Dunne, 61 Ill.2d 544, and cases cited therein.) However, defendants assert that "because of the all-encompassing, pervasive nature of the Racing Acts, as administered by the Racing Board, the State has preempted the field of horse racing." As a result, defendants insist that any concurrent local action is impermissible, even if undertaken by a home rule unit.

This court has recognized that the Racing Acts are part of a "comprehensive statutory plan for the regulation of the horse racing industry in Illinois." (People ex rel. Scott v. Illinois Racing Board, 54 Ill.2d 569, 577.) It is apparent that defendants have focused upon the regulatory character of that plan as the basis for their preemption argument. Defendants declare that the Racing Acts commit to the Racing Board "complete regulatory power" over the horse racing industry. Drawing analogies to the Environmental Protection Act (Ill. Rev. Stat. 1973, ch. 111 1/2, par. 1001 et seq.) and the Surface-Mined Land Conservation and Reclamation Act (Ill. Rev. Stat. 1973, ch. 93, par. 201 et seq.), defendants contend that those acts, like the Racing Acts, "completely govern the fields they were designed to regulate." Defendants then conclude that this court has not hesitated to find preemption by the State where the General Assembly has enacted an all-inclusive program "to regulate a particular area."

We cannot accept defendants' argument. The power to regulate and the power to tax are separate and distinct powers. (Rozner v. Korshak, 55 Ill.2d 430; Greater Chicago Indoor Tennis Clubs, Inc. v. Village of Willowbrook, 63 Ill.2d 400, 402.) Even if we assume, arguendo, that the existence of a comprehensive statutory regulatory scheme may serve, in a given instance, to preclude local regulatory efforts, it does not necessarily follow that the power to tax in that area would also be preempted.

More importantly, defendants underestimate the scope of the taxing power enjoyed by home rule units. As a home rule unit, plaintiff derives its powers from article VII, section 6, of the 1970 Constitution (Ill. Const. 1970, art. VII, sec. 6). That section reads, in pertinent part, as follows:

"(a) * * * Except as limited by this Section, a home rule unit may exercise any power and perform any function pertaining to its government and affairs including, but not limited to, the power * * * to tax; * * *.

(g) The General Assembly by a law approved by the vote of three-fifths of the members elected to each house may deny or limit the power to tax * * *.

(h) The General Assembly may provide specifically by law for the exclusive exercise by the State of any power or function of a home rule unit other than a taxing power * * *."

We have consistently held that article VII, section 6(a), confers upon home rule units a broad taxing power. (Mulligan v. Dunne, 61 Ill.2d 544; Paper Supply Co. v. City of Chicago, 57 Ill.2d 553; City of Evanston v. County of Cook, 53 Ill.2d 312; S. Bloom, Inc. v. Korshak, 52 Ill.2d 56.) As we declared in Mulligan, "[t]he framers of the 1970 Constitution considered the power to tax as essential to effective home rule and intended that power to be broad." 61 Ill.2d 544, 548.

Our decision in Mulligan v. Dunne effectively refutes defendants' preemption argument. In Mulligan, we were called upon to judge the validity of a Cook County ordinance which levied a tax upon the retail sale of alcoholic beverages. There too it was asserted that extensive regulation and taxation of the industry had preempted home rule taxing powers. In addressing that argument, we first observed that the statute recognized local interest in liquor control by permitting local regulation and licensing. We also remarked that the statute did not express exclusivity with regard to liquor taxation. Consequently, the ordinance in question, which attempted no regulation of areas regulated by the statute, did not conflict with the statute. However, we also went on to stress that "even an exercise of a home-rule power under section 6(a) which actually conflicts with a statute enacted prior to the adoption of the 1970 Constitution is nonetheless valid unless the power is restricted by a constitutional provision or appropriate legislation enacted subsequent to the 1970 Constitution," citing various other decisions of this court. (61 Ill.2d 544, 550.) In conclusion, we stated:

"Accordingly, since the General Assembly has not by a three-fifths majority chosen to limit the power of home-rule units to tax liquor, Cook County has not exceeded its home-rule power under section 6(a) by the ...

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