Appeal from the Circuit Court of McHenry County; the Hon.
Leonard Brody, Judge, presiding.
JUSTICE UNVERZAGT DELIVERED THE OPINION OF THE COURT:
Defendants, tax objectors, appeal from a McHenry County circuit court judgment which interprets section 20-2 of the School Code (Ill. Rev. Stat. 1981, ch. 122, par. 20-2) to allow a school district to incur an indebtedness and issue bonds as evidence thereof to increase the amount of money in the school district's existing working cash fund. Section 20-2 provides, "For the purpose of creating a working cash fund, the school board of any such district may incur an indebtedness and issue bonds as evidence thereof * * *." (Emphasis added.)
The boards of education for School Districts Nos. 158 and 200 levied property taxes to pay the principal and interest for working cash fund bonds issued to increase the amount of their existing working cash funds. District No. 158 issued $425,000 in bonds on September 1, 1978, when it had $12,037 remaining in its working cash fund; District No. 200 issued $1,650,000 in bonds on December 1, 1978, when it had $54,704 in its working cash fund. Defendants objected to these tax levies on their property in McHenry County for 1979 and to the entry of a judgment fixing the correct amount of their property tax in a sum in excess of the amount to which no objections were made. Defendants argued that since the school districts previously created working cash funds, they could not issue new bonds to replenish their funds and thus could not levy new taxes to pay the principal and interest on those bonds.
The trial court rejected defendants' arguments finding that the school boards could issue new bonds to produce new funds as required and denied the defendants' objections. Defendants appealed.
Article 20 of the School Code authorizes school districts with populations less than 500,000 inhabitants to create, maintain, and administer working cash funds to enable "the district to have in its treasury at all time sufficient money to meet demands thereon for ordinary and necessary expenditures * * *." (Ill. Rev. Stat. 1981, ch. 122, par. 20-1.) "For the purpose of creating" this fund, the school board of the district may incur an indebtedness and issue bonds as evidence thereof in an amount limited by a specified formula; before or at the same time that the bonds are issued, the school board must levy a direct annual property tax to generate sufficient money to pay the principal and interest on the bonds. (Ill. Rev. Stat. 1981, ch. 122, par. 20-2.) To issue bonds, the school board must adopt a resolution of its intent to do so and publish notice of this intent; if 20% or more of the voters petition that the proposition be submitted to a vote, an election must be held and the proposition must receive majority support. (Ill. Rev. Stat. 1981, ch. 122, par. 20-7.) To provide money for the fund, the school board may also levy annually a working cash fund property tax. Ill. Rev. Stat. 1981, ch. 122, par. 20-3.
Sections 20-4 and 20-5 of the School Code direct and limit the use of the working cash fund by establishing a reimbursement procedure whereby money borrowed from the fund to pay necessary and ordinary expenditures is replaced with money that is collected by taxes or otherwise for the purposes to which the fund money had been borrowed. (Ill. Rev. Stat. 1981, ch. 122, pars. 20-4, 20-5.) The fund may be abolished by resolution of the school board. (Ill. Rev. Stat. 1981, ch. 122, par. 20-8.) A school district which has abolished or abated its fund may create a new one. Ill. Rev. Stat. 1981, ch. 122, par. 20-9.
Defendants argue that the phrase "[f]or the purpose of creating" a fund found in section 20-2 limits a school board's authority to issue bonds only to create the fund, not to increase the amount of money in it. The school districts respond that the word "create" has a broader meaning than to establish as in the sense of an original inception; rather, according to the districts, it means to achieve different levels in the fund through a series of steps which increase the amount of the fund. They further argue that construing the section as defendants advocate would defeat the legislature's intent and lead to an absurd result which, if taken to its logical conclusion, would prohibit a school district with only $1 remaining in its fund from issuing new bonds but allowing a school district without any money remaining in its fund to recreate a fund and issue bonds in any amount.
• 1 The first canon of statutory interpretation is to ascertain and give effect to the legislative intent as expressed in the statute. (City of East Peoria v. Group Five Development Co. (1981), 87 Ill.2d 42, 46.) Provisions of a statute should be read in light of the statute as a whole. (Winks v. Board of Education (1979), 78 Ill.2d 128, 135.) The legislative intent usually appears from a consideration of the statute's language which affords the best means of its exposition. (Illinois Power Co. v. Mahin (1978), 72 Ill.2d 189, 194.) The words used in a statute are assumed to have been intended to retain their ordinary and popularly understood meaning. (Kozak v. Retirement Board (1983), 95 Ill.2d 211, 215.) If the legislative intent can be ascertained from the language of the statute, the language prevails and will be given effect; a court may not declare that the legislature did not mean what the plain language of the statute imports. Western National Bank v. Village of Kildeer (1960), 19 Ill.2d 342, 350.
• 2, 3 A court, however, is not bound by the literal language found in a statute where the language would defeat the legislature's obvious and clearly expressed objective or purpose. (People v. McCoy (1976), 63 Ill.2d 40, 45.) Words may thus be modified, altered, or supplied to obviate repugnancies or inconsistencies with the legislative intent. (People v. Bratcher (1976), 63 Ill.2d 534, 543.) As this court stated in People v. Gibson (1981), 99 Ill. App.3d 616, "courts> are generally cautious about adding words to a statute, [but] * * * will read into the meaning of a statutory provision a qualifying or expanding expression [which is] plainly implied by the general context of the enactment, which has been palpably omitted and which is essential to prevent the legislative purpose from failing in one of its important aspects." (99 Ill. App.3d 616, 620.) Where two constructions of a law are available, the one which would produce absurd results and render the operation of the law difficult should be avoided. Balmes v. HIABFOCO, A.B. (1982), 105 Ill. App.3d 572, 575.
The present statute is unambiguous. The word "create" means to bring into being, to cause to exist, or to produce. (Black's Law Dictionary 330 (5th ed. 1979).) For purposes of bringing into existence a fund where one does not exist, the statute authorizes the school board to incur an indebtedness and issue bonds as evidence of this indebtedness. It does not authorize a school board to later increase its indebtedness and issue new bonds once the fund already exists. Contrary to the school districts' assertions, this construction comports with the legislative intent as expressed in article 20 of the School Code.
Reading article 20 as a whole reveals the legislature's intent of stabilizing school finances by authorizing a school board to establish an internal source whereby a school may borrow money to pay for its ordinary and necessary expenditures. (Schwartz, Illinois School Finance — A Primer, 56 Chi-Kent L. Rev. 831, 849, 856 (1980).) The reimbursement procedure requiring school boards to replace money borrowed from the fund with revenue collected for the specific purpose for which the fund money was applied creates a revolving fund. (Mathews v. City of Chicago (1930), 342 Ill. 120.) This procedure evinces that the legislature contemplated that the amount of money in the fund would not be depleted but rather would remain fairly constant.
• 4 While article 20 provides that the initial source of the fund would come from the issuance of bonds, the legislature apparently recognized that the amount of money in the fund may become inadequate and thus provided two remedies. Section 20-3 allows a school board to levy annually a working cash fund tax in a prescribed formula. (Ill. Rev. Stat. 1981, ch. 122, par. 20-3.) This levy constitutes the only means to increase the amount of money in an existing fund. In Mathews v. City of Chicago (1930), 342 Ill. 120, the supreme court explained this procedure where it stated:
"The raising of a fund by the sale of bonds to meet the deficit and the establishment from the proceeds of such sale of a revolving fund, to be increased from time to time, if necessary, by a levy of taxes, may be a novel scheme, but it is not different in principle from the raising each successive year of a fund for the same purpose by borrowing money by means of anticipation warrants." 342 Ill. 120, 137.
Should the amount that could be levied under the formula set forth in that section prove insufficient to meet the needs of the school board, the school board may abolish the fund (Ill. Rev. Stat. 1981, ch. 122, par. 20-8), and then create a new one (Ill. Rev. Stat. 1981, ch. 122, par. 20-9). That the legislature intended this latter procedure may be inferred from its adding of section 20-9 to article 20 after the Illinois Supreme Court noted, but did not address, an appellant's objections to the article based upon the hypothesis that a board could annually create and abolish a fund. (See Bell v. School District No. 84 (1950), 407 Ill. 406, 414.) Section 20-9, added to the article in 1967, provides that, "Nothing in this Article prevents a school district which has abolished or abated its working cash fund from again ...