Jones v. State of Illinois Property Tax Appeal Board
2017 IL App (5th) 160199
Ill. App. Ct.2017Background
- Harlan and Phyllis Jones bought a vacant lot in Franklin County, IL in 2009 and installed a three‑module manufactured home in May–June 2010. They obtained a building permit, registered the modules with the Secretary of State, and paid sales tax, but did not register the home with the local tax assessor within 30 days as required by the Mobile Home Local Services Tax Act.
- The 2010 assessment cycle had effectively closed before the assessor added the home to the tax rolls; the property was assessed and taxed as a vacant lot for 2010 and first assessed as real property in 2011.
- The Joneses challenged the 2011 assessment as real property, arguing the home was installed before the effective date (Jan. 1, 2011) of amendments that reclassified many manufactured homes as real property and thus fell within the statutory "grandfather" protection (i.e., should remain taxed under the Mobile Home Tax Act).
- The Property Tax Appeal Board and the Franklin County circuit court upheld the real‑property assessment, emphasizing the Joneses’ failure to timely register the home; the Joneses appealed to the Appellate Court.
- The Appellate Court examined statutory language, the Department of Revenue guidance, factual evidence about installation and utility service in 2010, and whether failure to register precluded grandfathered status.
Issues
| Issue | Plaintiff's Argument (Jones) | Defendant's Argument (State/County) | Held |
|---|---|---|---|
| Whether a manufactured home installed before Jan. 1, 2011 but not assessed or taxed in 2010 is entitled to "grandfather" treatment under the prior Mobile Home Tax Act | Home installed in 2010 and thus should be taxed as it would have been in 2010 (i.e., under prior law) | Statutes only protect homes that were actually taxed under the Mobile Home Tax Act on the effective date; omission of unrolled homes means no grandfather protection | Court: The statutes omitted this small class by oversight; such homes installed before 2011 but not on 2010 rolls fit the Dept. of Revenue guidance and may receive treatment consistent with similar homes on 2010 rolls (reversed agency) |
| Whether failure to file the local registration within 30 days prevents taxation under the Mobile Home Tax Act or requires classification as real property | Registration was not a prerequisite to proper classification/taxation; the home was installed in 2010 and should be treated like similar 2010 homes | Registration requirement is mandatory and lack of registration means privilege tax cannot apply; home should be taxed as real property | Court: Registration is not a prerequisite to being taxed under the Mobile Home Tax Act; assessing officials must classify/tax property according to its proper status regardless of owner registration |
| Whether the Department of Revenue memorandum’s instruction applies to homes installed after the assessor finished the 2010 assessment cycle | The Dept. of Revenue memo applies: homes installed too late for 2010 rolls should be assessed consistently with similarly situated homes that were on 2010 rolls | Memo does not apply to homes that would have been registered if owners complied; this home was placed early enough that registration could have allowed 2010 taxation | Court: Facts show home was installed too late to be realistically assessed in 2010; memo applies and supports Jones’s position |
| Whether affirming higher taxation based on registration failure is an appropriate penalty | Denying grandfathered treatment based on a registration omission is an excessive penalty for a misdemeanor failure to register | Strict construction of tax statutes favors taxing authority; preferential tax treatment should be limited | Court: Treating a minor registration infraction as a basis for permanent higher taxation would be arbitrary and harsh; reversed agency/circuit decisions |
Key Cases Cited
- Denton v. Civil Service Comm’n, 277 Ill. App. 3d 770 (1996) (review of agency decisions under Administrative Review Law)
- AFM Messenger Service, Inc. v. Department of Employment Security, 198 Ill. 2d 380 (2001) (standards for mixed questions of fact and law and applicable review)
- Wal‑Mart Stores, Inc. v. Industrial Comm’n, 324 Ill. App. 3d 961 (2001) (statutory construction is question of law reviewed de novo)
- DeLuna v. Burciaga, 223 Ill. 2d 49 (2006) (principles of statutory interpretation and harmonizing related statutes)
- JPMorgan Chase Bank, N.A. v. Earth Foods, Inc., 238 Ill. 2d 455 (2010) (court will not read into statute limitations contrary to legislative intent)
- Reichert v. Board of Fire & Police Commissioners, 388 Ill. App. 3d 834 (2009) (definition of "clearly erroneous" standard for agency factual findings)
- People ex rel. Kassabaum v. Hopkins, 106 Ill. 2d 473 (1985) (tax exemptions or special tax treatments are strictly construed)