APPELLATE COURT OF ILLINOIS, SECOND DISTRICT
510 N.E.2d 564, 157 Ill. App. 3d 580, 109 Ill. Dec. 696 1987.IL.943
Appeal from the Circuit Court of Du Page County; the Hon. S. Bruce Scidmore, Judge, presiding.
JUSTICE DUNN delivered the opinion of the court. INGLIS, J. concurs. JUSTICE NASH, Dissenting.
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE DUNN
Plaintiff, Weslin Properties, Inc., sought a charitable exemption from taxation for 1983 and subsequent years for property it purchased in 1983. The Du Page County board of review and the Illinois Department of Revenue denied the exemption, finding that plaintiff's use of the property in 1983 was not charitable. The denial of exemption was affirmed on administrative review by the circuit court of Du Page County and this appeal followed. For the following reasons, we reverse.
In 1982, Copley Memorial Hospital (hospital), chartered in 1886 as a not-for-profit corporation, revised its corporate structure. Fox Valley Health Services Corporation was incorporated as the parent corporation, whose purpose is to continue the hospital's mission of providing health care and related services on a nondiscriminatory basis as to race, creed, sex, national origin, or financial ability. Plaintiff was incorporated at the same time as a not-for-profit corporation to hold real estate titles for the organization and to turn over any income received, less expenses, to the parent corporation. The hospital's governing members and board of directors became the members and directors of Fox Valley Health Services, and Fox Valley Health Services became the sole voting member of the hospital, plaintiff, and the other newly organized subsidiary corporations.
In 1980, the hospital began to study ways of continuing and expanding its provision of health services. Expansion at the present hospital site is impossible due to its location in an historic preservation district in Aurora. In 1981, the hospital employed long-range planning consultants who recommended the acquisition of 30 to 50 acres in the growing Fox Valley East development in Du Page County.
In 1982, another consultant was hired to make in-depth studies of the health care needs of Fox Valley East, to recommend specific services to be provided, and to make a financial feasibility study. Several potential sites available for purchase were identified, and in February 1983, plaintiff's board of directors recommended to the board of Fox Valley Health Services the purchase of 24.309 acres of land adjacent to the Fox Valley Shopping Center.
The Fox Valley Health Services board approved the purchase on April 26, 1983, and the land was purchased on May 26, 1983, for $2,197,000. The deed limits the use of the land for 10 years to health care purposes. On May 31, 1983, development of a master site plan and schematic drawings was authorized, and, after some refinements, the plan for the first building, the Urgent Care Center, was approved in October 1983. In early 1984, a construction manager was hired. Value engineering and final design changes were completed by July 1984. The groundbreaking ceremony for the Urgent Care Center was held on August 27, 1984, with completion of the Urgent Care Center scheduled for May 1985.
Plaintiff's petition for exemption was denied by the Du Page County board of review on December 2, 1983. The basis for the denial was as follows: "This parcel is presently vacant but will be used in the future as a medical complex. Because the property is now vacant, the Board of Review does not feel this parcel qualifies for tax exemption."
The Department of Revenue affirmed the board of review, initially listing the basis for denial as (1) primary use not charitable; (2) property not in exempt ownership; and (3) in general admissions policies for immediate care centers do not suggest a charitable use. Plaintiff requested that the Department of Revenue review its decision and on second review exemption was again denied on the basis that the primary use of the property was not charitable. Plaintiff then requested a formal hearing.
A hearing was held December 10, 1984, at which Greg Lintjer, president of Fox Valley Health Services, testified. His testimony detailed the motivation for and purpose of purchasing the land in question. He also testified, as set forth above, to the steps plaintiff had taken in the development of the property. The hearing officer found that charitable use had not begun in 1983, and plaintiff had not provided the admission and collection policies of the Urgent Care Center, and concluded that plaintiff had failed to establish the parcel was used for charitable purposes during 1983.
Plaintiff then sought administrative review of the Department of Revenue's determination in the circuit court of Du Page County. The court reviewed the record and memoranda submitted by the parties and held that the administrative ...