Docket No. 109711.
THE STATE OF ILLINOIS
FIRST AMERICAN BANK CORPORATION et al., Appellants, v.
GWEN HENRY, Du Page County Treasurer and ex officio Du Page
County Collector, Appellee (The Forest Preserve District of Du Page
Opinion filed January 21, 2011.
JUSTICE THEIS delivered the judgment of the court, with
Chief Justice Kilbride and Justices Freeman, Thomas, Garman,
Karmeier, and Burke concurred in the judgment and opinion.
The issue in this case is whether the Forest Preserve District of Du
Page County (the District) was required by section 7–171 of the
Illinois Pension Code (40 ILCS 5/7–171 (West 2008)) to enact an
appropriation ordinance for its contribution to the Illinois Municipal
Retirement Fund (IMRF) before it enacted a levy ordinance to raise
revenue that would, in part, cover this contribution. The circuit court
of Du Page County entered summary judgment in favor of the
District, and the appellate court affirmed. For the reasons that follow,
we also affirm.
1The IMRF does not cover employees of the City of Chicago or Cook
County. See 40 ILCS 5/7–132(A)(a) (West 2008).
2IMRF employer rates are on a “two-year lag.” See
http://www.imrf.org/info/press_room/IMRF_101.htm. For example,
information from 1998 was sent to actuaries in 1999, and they used that
information to calculate contribution rates for 2000.
The IMRF was established by the Illinois General Assembly in
1939 and began operating in 1941 as a public pension program for
five municipalities. Today, the fund administers $22.3 billion in assets
for nearly 275,000 current and former employees of 2,950 local
government entities across the state.1 Each municipality pays its own
employees’ disability, retirement, and death benefits into its own
account, pursuant to a contribution rate determined by independent
actuaries based upon the employees’ salaries, ages, and years of
service. Every June, the Retirement Fund Board notifies each
municipality of the preliminary contribution rate, and every November
of the final contribution rate, for the following year.2 Then each
municipality must raise revenue to support its contribution.
In June 1999, the District received an “Advance IMRF
Contribution Notice,” and in November 1999, it received an “Official
Notice of Illinois Municipal Retirement Fund Contribution Rate for
Calendar Year 2000.” On November 16, 1999, the District passed a
levy ordinance, which included $981,511 for its contribution to the
IMRF for the following year. On June 20, 2000, the District passed a
appropriation ordinance, which included $1,102,628 for its
contribution to the IMRF and referred to the November 16, 1999,
On November 15, 2000, First American Bank Corporation and
three other companies (the plaintiffs) filed a tax objection, contending
that the District lacked authority to levy for its IMRF contribution
before it appropriated for it because section 7–171(b)(1) of the
Pension Code limits the tax to the “amount appropriated.” See 40
ILCS 5/7–171(b)(1) (West 2008). In July 2008, the District was
granted leave to intervene in the case, and the parties agreed that any
final order in this case would govern the plaintiffs’ tax objections for
1999-2006. The District then filed a motion for summary judgment,
arguing that it acted within its authority under section 7–171 and
sections 13.1 and 13.3 of the Downstate Forest Preserve District Act.
See 70 ILCS 805/13.1, 13.3 (West 2008). The trial court concluded
that section 7–171(b)(1) sets a ceiling on, but not a timetable for, the
IMRF levy, and entered summary judgment in favor of the District.
The plaintiffs appealed.
The appellate court affirmed. 397 Ill. App. 3d 301. The appellate
court agreed with the plaintiffs that section 7–171(b)(1) gives
municipalities the authority to levy taxes for IMRF contributions. Id.
at 304. The appellate court, however, disagreed with the plaintiffs that
section 7–171(b)(1) requires municipalities to appropriate first and
levy second. Id. at 305. Such an interpretation, stated the appellate
court, goes beyond the statutory language:
“While the use of the phrase ‘the amount appropriated’ may
certainly be interpreted to refer to the amount ‘already
appropriated’ or ‘previously appropriated’ for a contribution
to the Fund, it is equally possible to read it as meaning the
amount ‘subsequently appropriated’ or ‘eventually
appropriated’ for such a contribution. The mere use of the
term ‘appropriated’ does not signify a preference for either of
these interpretations, and nothing about the language quoted
indicates that the legislature intended to impose a timing
sequence mandating that a municipality adopt an appropriation
ordinance before it adopts its levying ordinance. Rather than
imposing a timing requirement, the plain language of this
provision imposes a limit on the amount that may be levied: a
municipality may not levy taxes that would exceed the amount
appropriated for its contribution to the Fund. This restriction
prevents a municipality from accumulating excess funds at the
expense of the taxpayer. There is no hint of any other purpose
intended by the legislature in enacting this provision.”
(Emphasis in original.) Id. at 305.
The appellate court further stated that section 7–171(e) contains
a provision permitting municipalities to refer to other statutes in
establishing procedures for levying and collecting taxes for IMRF
contributions. Id. at 308. Here, the general taxes for the District are
levied and collected pursuant to sections 13.1 and 13.3 of the
Downstate Forest Preserve District Act. Id. at 308. Because the
District complied with that statute, the trial court did not err in
entering summary judgment in its favor. Id. at 309.
This court allowed the plaintiffs’ petition for leave to appeal. Ill.
S. Ct. R. 315 (eff. Feb. 26, 2010). Our standard of review is de novo.
See DesPain v. City of Collinsville, 382 Ill. App. 3d 572, 577 (2008)
(holding that statutory interpretation issues and summary judgment
rulings are both reviewed de novo).
To resolve the issue in this case, we must construe section 7–171
of the Pension Code. The cardinal rule of statutory construction is to
ascertain and give effect to the legislature’s intent, and the plain
language of the statute is the best indication of that intent. Acme
Markets, Inc. v. Callanan, 236 Ill. 2d 29, 37-38 (2009). When the
language is unambiguous, the statute must be applied as written.
DeLuna v. Burciaga, 223 Ill. 2d 49, 59 (2006). Additionally, the
entire statute must be read as a whole, considering all relevant parts.
Kraft, Inc. v. Edgar, 138 Ill. 2d 178, 189 (1990).
Section 7–171 governs “finance” and “taxes” and provides:
“(a) Each municipality other than a school district shall
appropriate an amount sufficient to provide for the current
municipality contributions required by Section 7–172 of this
Article, for the fiscal year for which the appropriation is made
and all amounts due for municipal contributions for previous
(b) For the purpose of providing monies for municipality
contributions, beginning for the year in which a municipality
is included in this fund:
(1) A municipality other than a school district may levy
a tax which shall not exceed the amount appropriated for
* * *
(e) Such tax shall be levied and collected in like manner,
with the general taxes of the municipality and shall be in
addition to all other taxes which the municipality is now or
may hereafter be authorized to levy upon all taxable property
therein ***.” 40 ILCS 5/7–171 (West 2008).
In this appeal, the plaintiffs argue that the phrase “amount
appropriated” in section 7–171(b)(1) unambiguously limits levies for
IMRF contributions to past, not future, appropriations. The plaintiffs
offer a short grammar lesson. Adding “-ed” to the root of a verb
creates the simple past tense form of the verb. When the past tense
form of a verb modifies a noun, the verb becomes a past participle,
and use of the past participle connotes action in the past. The past
tense of the verb “appropriate” is “appropriated.” Accordingly, the
plaintiffs contend, an “amount appropriated” is an amount
appropriated in the past. The plaintiffs contend that the legislature
used this phrase in section 7–171(b)(1) to set not only a quantitative
limit on IMRF levies, but also a temporal one. That is, the plaintiffs
assert that the legislature implicitly directed municipalities to
appropriate first and levy second for their contributions to the fund.
We agree with the plaintiffs that section 7–171(b)(1), when read
in isolation, seems to indicate that the appropriation must precede the
levy. But we must consider section 7–171 in its entirety, and interpret
section 7–171(b)(1) in its context. As the appellate court noted,
section 7–171(e) states that IMRF taxes “shall be levied and collected
in like manner, with the general taxes of the municipality.” 40 ILCS
5/7–171(e) (West 2008). The general taxes of the District are levied
and collected under the Downstate Forest Preserve District Act.
Section 13.1 of that statute governs forest preserve district tax
levies and states:
“After the first Monday in October and by the first
Monday in December in each year, the board shall levy the
general taxes for the District by general categories for the next
fiscal year. ***
All such taxes and rates are exclusive of the taxes required
for the payment of the principal of and interest on bonds, and
exclusive of taxes levied for employees’ annuity and benefit
purposes.” 70 ILCS 805/13.1 (West 2008).
Section 13.3, titled “Fiscal year; appropriation ordinance,” states:
“§13.3. (a) The board of each forest preserve district
organized under this Act shall fix a fiscal year for the district.
The board shall, within or before the first quarter of each fiscal
year, adopt an annual appropriation ordinance appropriating
such sums of money as may be required to defray all necessary
expenses and liabilities of the District to be paid or incurred
during the fiscal year.
(b) The failure of the board to adopt an annual
appropriation ordinance or to otherwise comply with the
provisions of this Section shall not affect the validity of any
tax levy of the forest preserve district. The annual
appropriation ordinance for any fiscal year need not be
intended or required to be in support of or in relation to any
tax levy made during that fiscal year.” 70 ILCS 805/13.3
Thus, for fiscal year beginning July 1, 2000, the District was
required to pass a levy ordinance between early October and early
December 1999, and an appropriation ordinance no later than
September 30, 2000. The Downstate Forest Preserve District Act
clearly allows the municipalities it governs to levy first and appropriate
second. The plaintiffs concede this point in their reply brief: “[T]here
is no doubt that for general purposes (i.e., excepting bond retirement
and pension purposes) a downstate forest preserve district is
mandated by sections 13.1 and 13.3 of the [Downstate Forest
Preserve District Act] to levy before the start of the ‘next fiscal year’
and, much later, to appropriate for expenses of the next fiscal year.”
What the plaintiffs fail to grasp is that there is no exception. Though
section 13.1 of the Downstate Forest Preserve Act provides that taxes
under the Act do not include taxes for IMRF contributions, it simply
recognizes the fact that “[t]he Illinois Municipal Retirement Fund Act
[citation] is a complete statutory enactment to provide for annuities
and benefits to municipal employees,” and a municipality must look to
that statute for authority to levy in support of its contribution to the
fund. People ex rel. Krapf v. Hayes, 13 Ill. 2d 143, 152 (1958).
Pursuant to section 7–171(e), municipalities must levy and collect
taxes to support their IMRF contributions in the same way that they
levy and collect their general taxes. Thus, the same statute–the
Downstate Forest Preserve Act–controls the timing of both the
District’s IMRF levy and its general tax levy, and permits the levy to
precede an appropriation.
The plaintiffs attempt to explain away section 7–171(e) by arguing
that “levied and collected in like manner, with the general taxes of the
municipality” is a term of art which means, simply, collected. They
quote and rely upon People ex rel. Kelly v. Baltimore & Ohio R.R.
Co., 376 Ill. 393 (1941). In Kelly, voters authorized a tax in support
of a township library pursuant to section 10 of “the act relating to
libraries” (see Ill. Rev. Stat. 1939, ch. 81, par. 10), and that tax was
later extended without further action by the township’s corporate
authorities. In determining whether the tax could be extended, we
noted that, prior to 1931, only voters, not the corporate authorities,
could levy the tax. We stated:
“When the decision in the case of People v. Illinois
Central Railroad Co.[, 240 Ill. 426 (1909),] was made, the
only provision of section 10 referring to the manner in which
the tax should be levied was the provision that a majority of
the voters at the ‘annual election’ in such town should vote in
favor of the tax by rate, which rate was required to be
specified in the notice of the election. It then provided further
that upon such vote being cast the tax so authorized ‘shall be
levied and collected in like manner with other general taxes’
of a town.
We think the decision in *** Illinois Central Railroad ***
was correct in holding that the vote in the election, as the
statute then read, constituted the levy of the tax voted without
any further act by the township. Under that decision, the
phrase last above quoted should be read as though the word
‘levied’ was followed by a comma, and that the words ‘in like
manner with other general taxes’ refer only to the collection
and not to the levy of the tax.” (Emphasis added.) Kelly, 376
Ill. at 395-96.
After 1931, when the statute was amended, the corporate authorities
could levy this tax. Kelly, 376 Ill. at 396. “By the provisions of other
statutes,” the corporate authorities were “the electors” at the annual
township meeting. Kelly, 376 Ill. at 396, citing Ill. Rev. Stat. 1939, ch.
139, par. 39. Thus, we concluded, the electors have a duty “to
determine, annually, the amount needed for the current year and to
levy the same *** in the same manner that taxes for other ***
purposes are levied.” Kelly, 376 Ill. at 398.
This holding is consistent with our holding in People ex rel.
Schlaeger v. Jarmuth, 398 Ill. 66 (1947). In Jarmuth, a taxpayer
objected to a tax levied under section 11 of the act establishing the
City of Chicago’s Municipal Employees’ Annuity and Benefit Fund
(see Ill. Rev. Stat. 1941, ch. 24, par. 1054), arguing that that statute
vested the power to tax in the fund’s Retirement Board, and not the
corporate authorities of the city. The statute provided that a tax to
support the fund must be “levied and collected in like manner with the
general taxes” of the city. In construing that language, we did not
mention Kelly, but we held that taxes for the fund must be levied in
“the manner in which the general taxes of the city are levied by the
corporate authorities of the city.” Jarmuth, 398 Ill. at 71.
Consequently, we referred to another statute–section 16–1 of the
Revised Cities and Villages Act–to determine how the city’s general
taxes were levied. Jarmuth, 398 Ill. at 71, quoting Ill. Rev. Stat. 1945,
ch. 24, par. 16–1. Notably, section 16–1 stated that no tax could be
levied unless an appropriation had been made. Jarmuth, 398 Ill. at 71.
Here, there is no corresponding limitation. Like the act
establishing the city’s annuity and benefit fund, section 7–171(e)
instructs municipalities to levy and collect taxes to support their
retirement fund contributions in the same manner in which they levy
and collect their general taxes. But unlike section 16–1 of the Revised
Cities and Villages Act, section 13.3 of the Downstate Forest Preserve
District Act does not prohibit a levy without an appropriation. Instead,
it states that the failure to adopt an appropriation ordinance does not
invalidate any levy ordinance.
The plaintiffs’ argument, as the appellate court here noted, distills
down to a policy argument that municipalities should appropriate first
and levy second. We are aware of the merits of such a procedure, but
we are also aware of the difficulties inherent in the long-range
financial forecasting that would be necessary if the District were
forced to appropriate well before its fiscal year begins. Cf. In re
Application of the County Collector of Du Page County for Judgment
for Taxes for the Year 1993, 187 Ill. 2d 326, 334-35 (1999) (detailing
the problems that schools districts would face under such a
requirement). Indeed, the District’s levy here was $121,117 less than
its ultimate appropriation more than seven months later, despite the
fact that it received a purportedly accurate contribution rate from the
Retirement Fund Board. Certainly this problem is not unique to forest
preserve districts, but the statutes establishing other special districts
are not before us here.
“The power to determine when a budget ordinance shall be
passed, and the order of passage as between levy and budget
ordinances, rests exclusively with the General Assembly.” People ex
rel. Rockwell v. Chicago, Burlington & Quincy R.R. Co., 386 Ill. 114,
117 (1944). Here, we hold that the legislature allowed the District to
pass a levy ordinance before it passed an appropriation ordinance. The
District had authority for its IMRF levy, and the trial court correctly
entered summary judgment in favor of the District.
For the reasons that we have stated, the judgment of the appellate
court is affirmed.
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