Appeal from the Circuit Court of Cook County. No. 10 CH 24439 The Honorable Nancy J. Arnold, Judge Presiding.
The opinion of the court was delivered by: Presiding Justice Lampkin
PRESIDING JUSTICE LAMPKIN delivered the judgment of the court, with opinion. Justices Garcia and Robert E. Gordon concurred in the judgment and opinion.
¶ 1 Plaintiff, Hawthorne Race Course, Inc. (Hawthorne), appeals the circuit court's ruling upholding the decision of defendant, the Illinois Racing Board (Board), in interpreting the Illinois Horse Racing Act of 1975 (Racing Act) (230 ILCS 5/54.75 (West 2010)). Plaintiff contends the Board erred in concluding that the percentage of the Horse Racing Equity Trust Fund (Fund) payable to each eligible licensee under the 2008 version of the Racing Act should be the same as that previously distributed under the 2006 version of the statute. Based on the following, we affirm.
¶ 3 The Fund was initially created in 2006 by Public Act 94-804 (Pub.
Act 94-804 (eff. May 26, 2006)) and codified as section 54.5 of the
Racing Act (230 ILCS 5/54.5 (West 2006)) (2006 statute). The 2006
statute became effective on May 26, 2006, and had a sunset provision,
establishing automatic repeal on May 26, 2008. The Racing Act imposed
surcharges on four Illinois riverboat casinos to help support the
horse-racing industry, such that the money deposited into the Fund was
distributed to organization licensees within the industry.*fn1
Pursuant to the 2006 statute, 60% of the Fund was to be
distributed to organization licensees for further distribution at
their race meetings as "purses," while the remaining 40% of the Fund
was to be distributed to organization licensees to improve, maintain,
market, and otherwise operate racing facilities. 230 ILCS 5/54.5(b)
¶ 4 On December 15, 2008, the legislature reenacted the repealed statute with Public Act 95-1008 (Pub. Act 95-1008 (eff. Dec. 15, 2008)), which extended the surcharges on qualifying riverboat casinos for an additional three years. Public Act 95-1008 was codified as section 54.75 of the Racing Act (230 ILCS 5/54.75 (West 2010)) (2008 statute). Public Act 95-1008, section 1, provided that the 2008 statute "re-enacts the provisions of Public Act 94-804 approved in 2006 and determined valid in 2008 by the Illinois Supreme Court [inEmpress Casino Joliet Corp. v. Giannoulias, 231 Ill. 2d 62, 896 N.E.2d 277 (2008)]." This court upheld the constitutionality of Public Act 95-1008 in Empress Casino Joliet Corp. v. Giannoulias, 406 Ill. App. 3d 1040, 942 N.E.2d 783 (2011).
¶ 5 The pertinent language of the 2008 statute was identical to that of the 2006 statute. The relevant language provided:
"(a) *** Moneys in the Fund shall be distributed as directed and certified by the Board in accordance with the provisions of subsection (b).
(b) The moneys deposited into the Fund, plus any accrued interest on those moneys, shall be distributed within 10 days after those moneys are deposited into the Fund as follows:
(1) Sixty percent of all moneys distributed under this subsection shall be distributed to organization licensees to be distributed at their race meetings as purses. ***
(2) The remaining 40% of the moneys distributed under this subsection
(b) shall be distributed as follows:
(A) 11% shall be distributed to any person *** who had operating control of a racetrack *** in a county with at least 230,000 inhabitants that borders the Mississippi River and is a licensee in the current year; and (B) the remaining 89% shall be distributed pro rata according to the aggregate proportion of total handle from wagering on live races conducted in Illinois *** for calendar years 2004 and 2005 to any person *** who (i) had majority operating control of a racing facility at which live racing was conducted in calendar year 2002, (ii) is a licensee in the current year, and (iii) is not eligible to receive moneys under subparagraph (A) of this paragraph (2).
The moneys received by an organization licensee under this paragraph (2) shall be used by each organization licensee to improve, maintain, market, and otherwise operate its racing facilities to conduct live racing, which shall include backstretch services and capital improvements related to live racing and the backstretch. Any organization licensees sharing common ownership may pool the moneys received and spent at all racing facilities commonly owned in order to meet these requirements.
If any person identified in this paragraph (2) becomes ineligible to receive moneys from the Fund, such amount shall be redistributed among the remaining persons in proportion to their percentages otherwise calculated." (Emphasis added.) 230 ILCS 5/54.75 (West 2010).
¶ 6 As a result of the litigation challenging the constitutionality of the 2006 statute, from May 27, 2006, through the end of May 2008, the casinos paid their respective surcharges into the State's protest fund. After the supreme court upheld the constitutionality of the 2006 statute and prior to the release of the money from the protest fund, the Board invited organization licensees to provide written submissions regarding the construction of section 54.5 of the Racing Act. Position papers were submitted by plaintiff, defendant Arlington Park Racecourse, L.L.C. (Arlington), and jointly by defendants Balmoral Racing Club, Inc. (Balmoral), and Maywood Park Trotting Association, Inc., (Maywood).
¶ 7 In a July 8, 2009, memorandum, the Board's staff issued an opinion regarding the interpretation of the 2006 statute, and in particular the language of subsection (b)(2). See 230 ILCS 5/54.5(b)(2) (West 2006). In the memorandum, the Board concluded that there were six qualifying entities that held "majority operating control" of a racing facility at which live racing was conducted in 2002, namely, plaintiff, defendant Arlington, defendant Balmoral, defendant Maywood, defendant Fairmount Park, Inc. (Fairmount), and National Jockey Club (National). Next, the Board interpreted the language of the statute that required an entity to be a licensee in the "current year" to mean the year in which the distribution from the Fund, or protest fund in that instance, was to be made. When interpreting the statute, the Board considered the complicated circumstances at issue, in that, due to the litigation surrounding the 2006 statute, more than three years had passed since the legislation had been enacted and the casinos had begun making payments into the protest fund; however, in concluding that the legislature intended "current year" to mean year of distribution, the Board relied on the legislative intent of the Racing Act, namely, to improve and grow the horse-racing industry.
¶ 8 Applying that interpretation to "current year," the Board concluded that plaintiff, defendant Arlington, defendant Balmoral, defendant Maywood, and defendant Fairmount remained eligible to receive a prorated portion of the protest fund because they were organization licensees in 2009, the year of proposed distribution. However, because National did not have a license after 2006, the Board concluded that National was not eligible to receive distributions from the protest fund, finding the legislative purpose of the Racing Act would be frustrated if an out-of-business licensee received funds designed to improve and grow the horse-racing industry. Because defendant Fairmount qualified for distributions under ...