Appeal from the Circuit Court of Will County; the Hon. Michael
A. Orenic, Judge, presiding.
PRESIDING JUSTICE BARRY DELIVERED THE OPINION OF THE COURT:
This appeal is from summary judgments entered in three tax objection proceedings in Will County circuit court, ordering tax refunds to Commonwealth Edison for the years 1977, 1978, and 1979 in a total amount of $2,601,267.92. Edison was found to be entitled to the refunds as a result of the downward revisions in the assessments of its pollution control facilities as certified by the Department of Revenue.
The assessment of pollution control facilities for property tax purposes was governed by sections 21a-1 and 21a-3 of the Revenue Act of 1939 (Ill. Rev. Stat. 1977, ch. 120, pars. 502a-1, 502a-3), which required the Department of Revenue to value such facilities in relation to their economic productivity to their owners. In the case of public utilities, such as Edison, the Department used the present cash value of the pollution control facilities as the basis for valuation since those facilities were included in the rate base from which Edison's rates were determined and, therefore, were considered to be economically productive.
Edison paid its Will County property taxes under protest for each of the years 1977, 1978, and 1979, and then filed timely tax objections, asserting that the valuations certified by the Department of Revenue were erroneous. While these tax objection proceedings were pending in Will County, Edison was pursuing its administrative remedies against the Department in Cook County. That case reached the supreme court, where the court ruled the 1979 amendment to section 21a-3 of the Revenue Act of 1939 to be applicable to assessments in prior years. The amendment required attribution of earnings to a pollution control facility only to the extent the facility produces a commercially saleable byproduct or affects the cost of products or services sold by the utility. (Commonwealth Edison Co. v. Department of Local Government Affairs (1981), 85 Ill.2d 495, 426 N.E.2d 817.) As a result of that decision, the Department issued new assessment figures for Edison's Will County pollution control facilities for the years 1977, 1978, and 1979.
The revised assessments for 1977 and 1978 for both personal and real property were computed on the basis of 1.5% of fair cash value equalized at 33 1/3%, i.e., .5%. The 1979 assessments of real property were similarly reduced to .5%, and certain electrostatic precipitators were reduced to zero valuation. The latter had been improperly classified as realty in 1979 after being classified as personalty in prior years. While the tax objections were pending, the supreme court held that under section 18.1 of the Revenue Act of 1939 (Ill. Rev. Stat. 1979, ch. 120, par. 499.1), it was improper to change personal property to a classification of real property after the abolition of the personal property tax. (Central Illinois Light Co. v. Johnson (1981), 84 Ill.2d 275, 418 N.E.2d 696.) Thus, when the Department of Revenue recertified the Edison assessments, the improper reclassification of this property was corrected by giving it a valuation of zero.
After the recertification of assessments by the Department of Revenue, Edison filed motions for summary judgment accompanied by affidavits in all the pending tax objection proceedings in Will County. In the meantime, Valley View Community Unit School District had been allowed to intervene in these proceedings, and the county treasurer joined with the school district in filing motions to dismiss the tax objections. After hearing arguments of counsel and receiving briefs, the circuit court denied the motions to dismiss and granted summary judgments in favor of Edison. The county treasurer and the school district have appealed from those rulings.
• 1 The first question raised upon appeal is, in essence, whether section 21a-3 of the Revenue Act of 1939 (Ill. Rev. Stat. 1981, ch. 120, par. 502a-3) is unconstitutional by its terms. The policy of the statutory provisions is set forth in section 21a-1 of the Revenue Act of 1939, as follows:
"It is hereby declared to be the policy of the State of Illinois that pollution control facilities should be valued, for purposes of the real and personal property tax laws of this State, in relation to 33 1/3% of the fair cash value of their economic productivity to their owners." Ill. Rev. Stat. 1981, ch. 120, par. 502a-1.
Section 21a-3 as originally enacted (see Ill. Rev. Stat. 1977, ch. 120, par. 502a-3) provided the following method of valuation of pollution control facilities:
"For the purpose of determining 33 1/3% of the fair cash value of any certified pollution control facilities in assessing said facilities under the real and personal property tax laws of this State, the Department shall take into consideration the actual or probable net earnings attributable to the facilities in question, capitalized on the basis of their productive earning value to their owner; the probable net value which could be realized by their owner if the facilities were removed and sold at a fair, voluntary sale, giving due account to the expense of removal and condition of the particular facilities in question; and such other information as the Department may consider as bearing on 33 1/3% of the fair cash value, to their owner, of the pollution control facilities in question, consistent with the principles set forth herein."
The 1979 amendment to section 21a-3 added the following language after the above:
"For the purposes of this Act, earnings shall be attributed to a pollution control facility only to the extent that the operation thereof results in the production of a commercially saleable byproduct or increases the production or reduces the production costs of the products or services otherwise sold by the owner of such facility. For the purposes of this Section the land underlying a cooling pond shall not be considered a part of a pollution control facility.
This amendatory Act of 1979 is not intended to nor does it make any change in the meaning of any provision in this Section but is intended to remove possible ambiguities, thereby confirming the existing meaning of this Section in effect prior to the effective date of this amendatory Act of 1979." Ill. Rev. Stat. 1979, ch. 120, par. 502a-3.
The appellants argue that section 21a-3 violates the uniformity requirement of the Illinois ...