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Mckenzie v. Johnson

OPINION FILED OCTOBER 21, 1983.

KURT MCKENZIE, APPELLEE AND CROSS-APPELLANT,

v.

J. THOMAS JOHNSON, DIRECTOR OF REVENUE, ET AL., APPELLANTS AND CROSS-APPELLEES (HOLY CROSS ROMAN CATHOLIC CONGREGATION OF CHAMPAIGN ET AL., INTERVENORS, APPELLEES, AND CROSS-APPELLANTS).



Appeal from the Circuit Court of Champaign County, the Hon. George S. Miller, Judge, presiding.

JUSTICE SIMON DELIVERED THE OPINION OF THE COURT:

Here we consider the facial constitutionality of legislation granting property tax exemptions for parsonages, fraternity and sorority houses and homestead improvements.

Plaintiff, Kurt McKenzie (McKenzie), a property taxpayer in Champaign County, filed this action in the circuit court of that county seeking a judgment declaring the tax exemptions unconstitutional and an injunction prohibiting the defendants — J. Thomas Johnson, Director of Revenue (the Director), and three members of the Champaign County board of review (the Board) — from granting or approving these exemptions in prospective tax years. In the circuit court several parties representing Roman Catholic, Presbyterian and Methodist churches (the churches) were granted leave to intervene.

McKenzie alleged that, on their face, the statutes authorizing the fraternity, parsonage and homestead-improvement exemptions (Ill. Rev. Stat. 1981, ch. 120, pars. 500.1, 500.2, 500.23-2, 500.23-3) violate the provisions of the Illinois Constitution that limit the legislature's power to grant exemptions from general property taxation (Ill. Const. 1970, art. IX, secs. 4(a), 6). After the churches unsuccessfully argued against McKenzie's standing to bring an action challenging the parsonage exemption, the circuit court granted the parties' motions for summary judgment. It held that the homestead-improvement exemptions were unconstitutional while the parsonage and fraternity exemptions were not.

The Director and the Board each filed direct appeals to this court (87 Ill.2d R. 302(a)) seeking a reversal of the circuit court's holding with regard to the homestead-improvement exemptions. When McKenzie and the intervenors appealed the other issues to the appellate court, this court granted motions to allow a direct appeal of the other issues to this court and to consolidate these appeals. We hold that the plaintiff has standing to challenge the parsonage exemption and that the parsonage, fraternity and homestead-improvement exemptions are all valid under the Illinois Constitution.

McKENZIE HAS STANDING TO CHALLENGE THE PARSONAGE EXEMPTION

"This court will not determine the constitutionality of the provisions of an act * * * where the party urging the invalidity of such provisions is not in any way aggrieved by their operation." (Liberty National Bank v. Collins (1944), 388 Ill. 549, 559; Schreiber v. County Board of School Trustees (1964), 31 Ill.2d 121, 125.) The churches contend that McKenzie, as a taxpayer, has not alleged an interest in the controversy over the constitutionality of the parsonage exemption sufficient to confer standing upon him to raise that issue. We disagree.

Article IX, section 6, of the Constitution provides:

"The General Assembly by law may exempt from taxation only the property of the State, units of local government and school districts and property used exclusively for agricultural and horticultural societies, and for school, religious, cemetery and charitable purposes. The General Assembly by law may grant homestead exemptions or rent credits. (Emphasis added.) (Ill. Const. 1970, art. IX, sec. 6.)

By establishing the principle that property taxes will be levied against all property in the State except for property exclusively used for the purposes described, article IX, section 6, guarantees every real property owner in this State that the burdens of real property taxation will be evenly distributed among all owners of such property. See also Ill. Const. 1970, art. IX, sec. 4(a) ("taxes upon real property shall be levied uniformly").

McKenzie alleged that the granting or approval of parsonage exemptions "for property owned in Champaign County by persons other than the Plaintiff raises the amount of real property tax which Plaintiff must pay," an allegation which is admitted by the Board in its answer to the complaint. By bringing himself within the ambit of the specific guarantee set forth in article IX, section 6, and by claiming that his tax liability is generally affected by a statute which facially violates that guarantee, we believe that McKenzie has alleged a sufficient stake or interest in this controversy to confer standing upon him in this action. See generally Standing of One Taxpayer to Complain of Underassessment or Nonassessment of Property of Another for State and Local Taxation, Annot., 9 A.L.R.4th 428, 471-79 (1981).

The churches rely on authority holding that "there is no right in an individual taxpayer to bring a suit for the collection of taxes, but a suit having for its purpose such collection must be brought by the person or agency designated by statute for that purpose." (People ex rel. Morse v. Chambliss (1948), 399 Ill. 151, 158; see also Hoffman v. Northwestern University (1976), 40 Ill. App.3d 1012, 1016.) These cases, however, differ from this action, for here the plaintiff seeks to enjoin public officials from enforcing a tax-exemption statute which allegedly is unconstitutional on its face. "[A]n unconstitutional exercise of the taxing * * * power is intolerable in our system of government and * * * the courts> should be readily available to immediately restrain such excesses of authority." (Paul v. Blake (Fla. App. 1979), 376 So.2d 256, 259 (holding that taxpayer has standing to challenge the constitutionality of certain property tax exemptions but denying standing to raise other allegations of unlawfulness).) We reserve, however, the question of whether a taxpayer may bring an injunction action against public officials where the taxpayer alleges that the grant of an exemption for a specific parcel of property violates article IX, section 6.

THE PARSONAGE EXEMPTION IS CONSTITUTIONAL

Section 19.2 of the Revenue Act of 1939 establishes a property tax exemption for "[a]ll property used exclusively for religious purposes * * * and not leased or otherwise used with a view to profit, including all such property owned by churches or religious institutions or denominations and used in conjunction therewith as parsonages or other housing facilities provided for ministers * * * their spouses, children and domestic employees, performing the duties of their vocation as ministers at such churches or religious institutions or for such religious denominations, and including the convents and monasteries where persons engaged in religious activities reside." (Ill. Rev. Stat. 1981, ch. 120, par. 500.2.) The language referring to parsonages was added in a 1957 amendment to the statute. (1957 Ill. Laws 614.) McKenzie contends that parsonages are ineligible for property tax exemptions because they are used primarily for residential purposes, and are not used exclusively for religious purposes as required by article IX, section 6, of the Constitution. Thus, he claims that the parsonage exemption contained in section 19.2 is unconstitutional.

Cases construing article IX, section 3, of the 1870 Constitution, which permitted property tax exemptions for "property * * * used exclusively for * * * religious * * * purposes" (Ill. Const. 1870, art. IX, sec. 3), are relevant in construing the limits of exemptions under article IX, section 6, of the present constitution. (Small v. Pangle (1975), 60 Ill.2d 510, 514, cert. denied (1975), 423 U.S. 918, 46 L.Ed.2d 245, 96 S.Ct. 257.) In arguing that the parsonage exemption contained in section 19.2 is unconstitutional, McKenzie relies on People ex rel. Thompson v. First Congregational Church (1907), 232 Ill. 158, where in holding that a property tax exemption for parsonages, enacted in 1905, was unconstitutional under article IX, section 3, of the 1870 Constitution the court observed:

"The parsonage in this case was used as a home for the pastor and the members of his immediate family. So far as appears from this record, it was used as a family residence and nothing more. * * * [T]here seems to be no ground upon which it can be successfully contended that it was used for a religious purpose * * *. No doubt the pastor, in the performance of his duties, necessarily requires a place for meditation, study and prayer; but ordinary living rooms, used in common by all members of his household, would seem not well adapted for such purposes." 232 Ill. 158, 162-63.

The 1905 parsonage exemption declared unconstitutional in People ex rel. Thompson v. First Congregational Church authorized an exemption for "[a]ll church property * * * exclusively used for public worship and all parsonages or residences * * * used by persons devoting their entire time to church work." (Emphasis added.) 232 Ill. 158, 161.) That parsonage exemption is fundamentally different from the exemption provided by section 19.2, the statute involved in this case. In providing an exemption for parsonages whether or not they were used exclusively for religious purposes, the 1905 exemption violated the venerable principle that a property tax exemption created by "statute cannot be made broader than the provisions of the constitution and no property except that mentioned in [the exemption] section [of the Constitution] can be exempted by any law passed by the legislature." (Locust Grove Cemetery Association v. Rose (1959), 16 Ill.2d 132, 137; Consolidated Coal Co. v. Miller (1908), 236 Ill. 149, 152.) In declaring the 1905 exemption unconstitutional this court embraced that principle, observing:

"Where a building is used primarily for religious purposes and secondarily for some secular purpose * * * the building would not thereby lose its character as one used for religious purposes, but where the property is used primarily for a family residence by the pastor it cannot be held that it is used exclusively for religious purposes. The legislature cannot, by its enactment, make that a religious purpose which in fact is not a religious purpose." (Emphasis added.) 232 Ill. 158, 164.

The language of the current parsonage exemption, on the other hand, refers to "all such property owned by churches or religious institutions * * * and used * * * as parsonages * * *." (Emphasis added.) (Ill. Rev. Stat. 1981, ch. 120, par. 500.2.) The word "such" refers to the preceding language which allows an exemption only for "property used exclusively for religious purposes." (Ill. Rev. Stat. 1981, ch. 120, par. 500.2.) The current parsonage exemption only lists parsonages to illustrate or describe one type of property that, under appropriate circumstances, may qualify for the general religious property exemption which tracks the language of article IX, section 6, of the Constitution. Unlike the 1905 parsonage ...


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