The Village of Arlington Heights v. Pappas
409 Ill. Dec. 301
| Ill. App. Ct. | 2016Background
- Arlington Heights established two TIF districts (1983, 1986) that diverted all tax increments to the Village for 23 years and used those funds for redevelopment.
- Some property owners successfully challenged assessments for properties inside the TIFs; refund orders were entered after the TIFs expired (post-TIF).
- The Cook County Treasurer issued refunds to taxpayers from the Class A fund to comply with court/IPTAB orders and avoid statutory interest.
- Treasurer sought reimbursement from Arlington Heights by deducting the refunded amounts from future tax distributions to the Village; when no more increments were paid into the Village’s special TIF funds, Treasurer demanded repayment directly from the Village.
- Village sued for declaratory and injunctive relief; Treasurer counterclaimed and brought unjust-enrichment claim and third-party claims against other taxing districts. The circuit court granted summary judgment for the Treasurer.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether statute authorizes Treasurer to be reimbursed by Village for post-TIF refunds | Village: Treasurer lacks statutory authority to recover post-TIF refund amounts from Village | Treasurer: Property Tax Code (sections 23-20 and 20-175(a-1)) authorizes Treasurer to make refunds and deduct/reimburse from funds due taxing bodies, implying authority to recover from Village | Held: Treasurer entitled to reimbursement; sections 23-20 and 20-175(a-1) imply authority to recover post-TIF refunds from Village |
| Whether TIF Act controls Treasurer’s reimbursement authority for post-TIF refunds | Village: TIF Act governs distribution and thus limits Treasurer’s recovery from Village | Treasurer: Post-TIF refunds are governed by the Property Tax Code because refunds occurred after TIF expiration | Held: Property Tax Code controls post-TIF refunds; TIF Act contains no post-TIF reimbursement provision |
| Whether Treasurer’s practice of making refunds from Class A fund then deducting from funds due taxing bodies is permissible | Village: Treasurer’s reimbursement method is improper and Village should not bear full burden | Treasurer: Practice aligns with statutory refund/reimbursement scheme and county collector discretion | Held: Practice consistent with statutory scheme and permissible exercise of collector’s discretion |
| Whether other taxing districts share liability for post-TIF refunds | Village: Burden should be pro rata among taxing districts in former TIF area | Treasurer/Trial Court: Recovery against Village proper; third-party claims moot at summary judgment | Held: Court did not reach allocation to other districts; affirmed Treasurer’s recovery from Village and declined to address other arguments |
Key Cases Cited
- Phoenix Bond & Indemnity Co. v. Pappas, 194 Ill. 2d 99 (Ill. 2000) (county collectors may exercise discretion to implement legislative schemes)
- Lake County Board of Review v. Property Tax Appeal Board, 119 Ill. 2d 419 (Ill. 1988) (collector discretion and statutory implementation principles)
- Board of Education, Pleasantdale School District No. 107 v. Village of Burr Ridge, 341 Ill. App. 3d 1004 (Ill. App. Ct. 2003) (purpose of TIF Act)
- Shuttlesworth v. City of Chicago, 377 Ill. App. 3d 360 (Ill. App. Ct. 2007) (summary judgment standards)
- Pielet v. Pielet, 2012 IL 112064 (Ill. 2012) (cross-motions for summary judgment do not automatically eliminate material factual disputes)
- Carpenter v. Exelon Enterprises Co., 399 Ill. App. 3d 330 (Ill. App. Ct. 2010) (statutory provisions must be read together)