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Arangold Corporation v. Zehnder

July 01, 1999

ARANGOLD CORPORATION, D/B/A ARANGOLD CIGAR COMPANY, APPELLEE,
v.
KENNETH E. ZEHNDER, DIRECTOR OF REVENUE, ETAL., APPELLANTS.



The opinion of the court was delivered by: Justice Bilandic

Agenda- March 6, 1999.

The central issue in this appeal is whether the General Assembly violated the single subject requirement of the Illinois Constitution of 1970 (Ill. Const. 1970, art. IV, §8(d)) when it enacted Public Act 89-21 (Pub. Act 89-21, eff. June 6, 1995; July 1, 1995; January 1, 1996). Public Act 89-21 is the Eighty-Ninth General Assembly's state budget implementation act for fiscal year 1996. The plaintiff, Arangold Corporation, doing business as Arangold Cigar Company, brought this action in the circuit court of Cook County to enjoin the enforcement of a tobacco tax that was enacted as part of Public Act 89-21, and to recover those monies that it had paid under protest toward the tax. The plaintiff sought a summary judgment that Public Act 89-21 is unconstitutional because the General Assembly violated the single subject rule in enacting it. The circuit court agreed and granted summary judgment for the plaintiff. The defendants, Director of Revenue Kenneth E. Zehnder, State Treasurer Judy Baar Topinka, and the Department of Revenue, appeal directly to this court (134 Ill. 2d R. 302(a)). For the reasons that follow, we hold that Public Act 89-21 does not violate the single subject requirement. We therefore reverse the circuit court's grant of summary judgment to the plaintiff.

BACKGROUND

Proceedings and Decision of the Circuit Court

The plaintiff is a wholesale tobacco distributor. It brought this action as a challenge to the Tobacco Products Tax Act of 1995 (Tobacco Tax Act) (35 ILCS 143/10-1 et seq. (West 1996)), which was enacted as part of Public Act 89-21. The plaintiff originally argued that the Tobacco Tax Act violated the due process and equal protection clauses of the United States and Illinois Constitutions, and also violated the uniformity requirement and the special legislation prohibition of the Illinois Constitution. The plaintiff moved for summary judgment on those four counts in July of 1996. The circuit court denied that motion on July 3, 1997.

Meanwhile, on June 27, 1997, the plaintiff obtained leave to amend its complaint to add a fifth count. The plaintiff then alleged that Public Act 89-21 is invalid because it does not comply with the single subject requirement of the Illinois Constitution. The plaintiff moved for summary judgment on this claim. The circuit court granted the plaintiff's motion and held Public Act 89-21 unconstitutional in its entirety because it violates the single subject rule.

In rendering its decision, the court conceded the possibility that the provisions of Public Act 89-21 are "related in some fashion" to "balancing the state budget." Nonetheless, the court stated, "the single subject rule requires more, namely, that the provisions be related to each other." The court concluded that the provisions within Public Act 89-21 are not related to each other. As an example, the court discussed the Tobacco Tax Act, which, the court found, stands "alone and apart from every other provision," "unrelated to the first amendment in the Act, *** unrelated to the last amendment in the Act, *** and *** unrelated to most if not all of the numerous provisions in between."

Lastly, the court rejected the defendants' argument that its decision invalidating Public Act 89-21 be given prospective effect only. The court stated that its decision was not based on a new principle of law. Although the court admitted that "the wide-ranging effects of declaring Public Act 89-21 to be unconstitutional are indeed chilling and contrary to the critical public interest in the orderly administration of government," it concluded that this factor alone did not warrant limiting the effect of its decision.

Based on its Conclusion that Public Act 89-21 is invalid in its entirety for violating the single subject rule, the court entered a final judgment for the plaintiff. That judgment was appealed directly to this court pursuant to Supreme Court Rule 302(a), which provides for direct appeal from final judgments of the circuit courts in cases in which an Illinois statute has been held invalid. See 134 Ill. 2d R. 302(a).

Enactment of Public Act 89-21

When Public Act 89-21 originated in the Senate as Senate Bill 465, its short title was "FY1996 Budget Implementation Act" and its "purpose and subject" were to "make the changes in State programs that are necessary to implement the Governor's FY1996 budget recommendations." The bill proceeded through the legislative process. A joint conference committee was appointed after the Senate and the House failed to agree on the bill's provisions. After conferring, the committee recommended changing the bill's title to "An Act concerning State services, amending named Acts," and also recommended adopting a new and lengthy set of substantive provisions. V 1995 Ill. S.J. 4248-368; VI 1995 Ill. H.J. 6279-398.

Both the Senate and the House debated the report of the conference committee. In the Senate, the sponsor, Senator Maitland, introduced the committee's report as "the budget implementation language for the FY'96 budget." 89th Ill. Gen. Assem., Senate Proceedings, May 26, 1995, at 36 (comments of Senator Maitland). Senator Maitland described the major aspects of the report. Other senators followed with criticism of the report. The House sponsor, Representative Ryder, introduced the committee's report as "the Budget Implementation Act for the fiscal year 1996." 89th Ill. Gen. Assem., House Proceedings, May 26, 1995, at 102 (comments of Representative Ryder). Representative Ryder generally described the report as containing "the substantive language necessary to implement the budget that we are proposing," and he outlined the major aspects of the report. Debate ensued in the House in which members criticized and expressed support for the report.

Following the debates, both the Senate and the House voted to adopt the report of the conference committee. I Final Legislative Synopsis & Digest of the 1995 Session of the 89th Ill. Gen. Assem., at 341 (Legis. Synopsis). On June 6, 1995, the Governor approved the bill as Public Act 89-21. Legis. Synopsis at 341; 1995 Ill. Laws 673-807.

The actual state budget was debated and adopted by the legislature on the same day as the budget implementation bill discussed above. The Governor approved the budget bill as Public Act 89-22, also on June 6, 1995. Legis. Synopsis at 567-68; 1995 Ill. Laws 807-1216.

The General Assembly has enacted a state budget implementation bill or bills every year since 1991.

Contents of Public Act 89-21

To implement the budget, Public Act 89-21 amended 21 different acts, some extensively and others in minor respects. The amended acts include the State Employees Group Insurance Act of 1971 (5 ILCS 375/1 et seq. (West 1996)), the Illinois Pension Code (40 ILCS 5/1-101 et seq. (West 1996)), the Illinois Act on the Aging (20 ILCS 105/1 et seq. (West 1996)), the Civil Administrative Code of Illinois (20 ILCS 405/64 et seq. (West 1996)), the Children and Family Services Act (20 ILCS 505/1 et seq. (West 1996)), the Disabled Persons Rehabilitation Act (20 ILCS 2405/0.01 et seq. (West 1996)), the State Finance Act (30 ILCS 105/1 et seq. (West 1996)), the State Prompt Payment Act (30 ILCS 540/0.01 et seq. (West 1996)), the Illinois Income Tax Act (35 ILCS 5/101 et seq. (West 1996)), the State Mandates Act (30 ILCS 805/1 et seq. (West 1996)), the School Code (105 ILCS 5/1-1 et seq. (West 1996)), the Nursing Home Care Act (210 ILCS 45/1-101 et seq. (West 1996)), the Child Care Act of 1969 (225 ILCS 10/1 et seq. (West 1996)), the Riverboat Gambling Act (230 ILCS 10/1 et seq. (West 1996)), the Illinois Administrative Procedure Act (5 ILCS 100/1-1 et seq. (West 1996)), the Illinois Public Aid Code (305 ILCS 5/1-1 et seq. (West 1996)), the Abused and Neglected Child Reporting Act (325 ILCS 5/1 et seq. (West 1996)), the Juvenile Court Act of 1987 (705 ILCS 405/1-1 et seq. (West 1996)), the Adoption Act (750 ILCS 50/0.01 et seq. (West 1996)), the Probate Act of 1975 (755 ILCS 5/1-1 et seq. (West 1996)), and the Unemployment Insurance Act (820 ILCS 405/100 et seq. (West 1996)).

Public Act 89-21 also repealed the Tobacco Products Tax Act (1995 Ill. Laws 731) and replaced it with the Tobacco Products Tax Act of 1995 (see 1995 Ill. Laws 726). The new Tobacco Products Tax Act of 1995 changed language in the act and imposes a tax at a different rate than its predecessor. Compare 35 ILCS 143/10-1 et seq. (West 1996) with 35 ILCS 142/1 et seq. (West 1994) (repealed); see also 89th Ill. Gen. Assem., House Proceedings, May 26, 1995, at 102, 114. This new Tobacco Tax Act prompted the instant challenge to Public Act 89-21's constitutionality.

A brief description of the substance of the foregoing amendments follows. The Illinois Public Aid Code was amended to abolish the interim assistance program for persons awaiting a determination of their eligibility for federal supplemental security income payments. 1995 Ill. Laws 732-33, 762. The Public Aid Code's provisions relating to Medicaid reimbursements were amended by freezing the reimbursement rates (1995 Ill. Laws 744, 775-77), by allowing the Department of Public Aid to determine criteria for adjustable payments to hospitals (1995 Ill. Laws 743, 779), and by changing the payment of assessments by hospitals and developmentally disabled care providers (1995 Ill. Laws 758-59).

The Children and Family Services Act was amended to postpone the requirement that the Department of Children and Family Services (DCFS) provide family preservation services (1995 Ill. Laws 696), to bar DCFS from assuming responsibility for any minor over the age of 13 who is charged with a criminal offense (1995 Ill. Laws 697), to permit DCFS to set up certain savings accounts (1995 Ill. Laws 699), and to permit DCFS to place a child with a relative, as defined therein (1995 Ill. Laws 701-02). To account for these changes to the Children and Family Services Act, Public Act 89-21 amended several other acts as well. For example, the Juvenile Court Act of 1987 was amended primarily to correspond with the limits placed on DCFS's responsibility for delinquent minors (1995 Ill. Laws 785, 789, 797) and the expansion of DCFS's ability to place children with relatives (1995 Ill. Laws 782-83). The Abused and Neglected Child Reporting Act was amended to reflect the postponement of family preservation services. 1995 Ill. Laws 781. The Adoption Act was amended to exempt children placed with relatives from the Child Care Act of 1969 (1995 Ill. Laws 800), and the Child Care Act was changed to include relatives licensed as foster parents in the definition of "child care facility" and to permit relatives who receive children for placement to operate a "foster family home" (1995 Ill. Laws 721-25).

Likewise, changes in other acts appear to have corresponded to the changes in the Medicaid reimbursement scheme in the Public Aid Code. The Tobacco Tax Act was enacted to provide funds for the Long-Term Care Provider Fund. 1995 Ill. Laws 728. The State Prompt Payment Act was amended to exempt certain state-paid medical assistance from the definition of "goods and services furnished to the State" (1995 Ill. Laws 709) and to delete the approval dates for payments to managed health care and long-term care entities under the Public Aid Code (1995 Ill. Laws 710).

Also related to the changes to the Public Aid Code were amendments to the Illinois Act on the Aging, the Disabled Persons Rehabilitation Act, the Nursing Home Care Act, and the Probate Act of 1975. These amendments required screening of persons seeking admission to nursing homes to determine their need for services, or assigned responsibility for screening. 1995 Ill. Laws 687, 705-06, 719. These amendments also gave the state the right to seek reimbursement from a person's estate for certain public assistance provided during the person's life. 1995 Ill. Laws 685, 706, 802.

Public Act 89-21 made further amendments. It amended the State Employees Group Insurance Act of 1971 to provide the Department of Central Management Services with information about the Teachers Retirement System (TRS) program, changed the definition of "TRS dependent beneficiary," and also made changes relating to eligibility, premiums, interest, contributions, and payment of administrative costs. 1995 Ill. Laws 673-82. The Civil Administrative Code was altered to require certain state automobile liability claims to be paid from the Road Fund. 1995 Ill. Laws 688. The State Finance Act was amended to appoint the Bureau of the Budget as the state ...


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