SUPREME COURT OF ILLINOIS
533 N.E.2d 1072, 126 Ill. 2d 326, 127 Ill. Dec. 944 1989.IL.48
No. 66381. -- Appeal from the Appellate Court for the Fifth District; heard in that court on appeal from the Circuit Court of Saline County, the Hon. C. DAVID NELSON, Judge, presiding. No. 66544 -- Appeal from the Appellate Court for the Second District; heard in that court on appeal from the Circuit Court of DuPage County, the Hon. BRUCE SCHIDMORE, Judge, presiding.
No. 66381. -- Hon. C. David Nelson, Judge, presiding; Justice Clark delivered opinion; Justice Calvo -- No. 66544. -- Hon. S. Bruce Scidmore, Judge, presiding; Justice Clark delivered opinion; Justice Calvo
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE CLARK
These consolidated cases raise the question of whether certain real estate leased to private individuals by an airport authority is exempt from taxation as property belonging to an airport authority and "used for Airport Authority purposes" (Ill. Rev. Stat. 1985, ch. 120, par. 500.20). The property in question in No. 66381 consists of hangars rented by the Harrisburg-Raleigh Airport Authority to private individuals for storage of their private aircraft. The property in question in No. 66544, owned by the Fox Valley Airport Authority, consists not only of hangars but also various other facilities for the private storage or maintenance of aircraft, as well as two additional parcels of land, one leased to a private individual as a residence and the second leased as a farm, which are being held for future expansion of the airport. No. 66544 also raises the question of whether a notice of appeal from a judgment of the circuit court is timely filed if it is mailed within the 30-day period for filing a timely notice but is not received by the clerk of the circuit court until after the period has expired. For the purposes of convenience, we will treat each case separately.
HARRISBURG-RALEIGH AIRPORT AUTHORITY
In No. 66381, the appellant, the Illinois Department of Revenue, denied tax-exempt status to certain property owned by the appellee, the Harrisburg-Raleigh Airport Authority. The circuit court of Saline County reversed the denial, and the appellant appealed to the appellate court. In a unanimous decision, the appellate court affirmed (163 Ill. App. 3d 253), holding that the property at issue was exempt for leave to appeal (107 Ill. 2d R. 315(a)).
The property in question consists of 20 aircraft hangars which are available for rent to the public for storage of aircraft on a first come, first served basis. The airport averages a 75% occupancy rate, approaching full occupancy during the winter months. The hangars are rented on a monthly basis at the rate of $35 to $85 per month. Some tenants pay rent for a full year in advance, rather than on a monthly basis. The airport maintains the hangars and provides electricity.
This case turns on a question of statutory interpretation, arising under section 19.20 of the Revenue Act of 1939 (Ill. Rev. Stat. 1985, ch. 120, par. 500.20). Section 19.20 provides tax-exempt status for "[a]ll property of every kind belonging to any Airport Authority and used for Airport Authority purposes." The parties do not dispute that the appellee is an airport authority and that it owns the hangars. Thus, the critical question is whether the hangars are being used for "Airport Authority purposes."
The general principles governing our interpretation of the statute are clear. Where, as here, the facts are undisputed, a determination of whether property is exempt from taxation is a question of law. ( Weslin Properties, Inc. v. Department of Revenue (1987), 157 Ill. App. 3d 580, 583.) While the Department's determination is entitled to some deference, courts of review are not bound to give the same measure of deference to an administrative agency's construction of a statute as is given to its findings of fact. ( Nestle Co. v. Johnson (1979), 68 Ill. App. 3d 17, 20.) A decision based upon an erroneous, arbitrary, or unreasonable construction of a statute cannot be allowed to stand. ( Winnetkans Interested in Protecting the Environment v. Pollution Control Board (1977), 55 Ill. App. 3d 475, 480.) On the other hand, statutes exempting property from taxation are to be strictly construed in favor of taxation ( Telco Leasing, Inc. v. Allphin (1976), 63 Ill. 2d 305, 310; Follett's Illinois Book & Supply Store, Inc. v. Isaacs (1963), 27 Ill. 2d 600, 606), and the taxpayer seeking the protection of the exemption bears the burden of proving that he is entitled to it ( Thermos v. Department of Revenue (1976), 37 Ill. App. 3d 410, 414).
The parties urge two differing interpretations of the phrase "Airport Authority purposes." The appellant relies principally on section 7 of "An Act in relation to airport authorities" (Act) (Ill. Rev. Stat. 1985, ch. 15 1/2, par. 68.1 et seq.), which states:
"The establishment and continued maintenance and operation of safe, adequate and necessary public airports and public airport facilities . . . and the creation of airport authorities having powers necessary or desirable for the establishment and continued maintenance and operation of such airports and facilities are declared and determined to be in the public interest, and such powers and the corporate purposes and functions of such authorities, as herein stated, are declared to ...