Jacobs v. City of Chicago

• Decision Date: 26 January 1973
• Docket Number: No. 45269,45269
• Citation: 292 N.E.2d 401,53 Ill.2d 421
• Parties: Aaron M. JACOBS et al., Appellants, v. The CITY OF CHICAGO et al., Appellees.
• Court: Illinois Supreme Court

Page 401

292 N.E.2d 401

53 Ill.2d 421

Aaron M. JACOBS et al., Appellants, v. The CITY OF CHICAGO et al., Appellees.

No. 45269.

Supreme Court of Illinois.

Jan. 26, 1973.

Eugene Lieberman, Chicago, for appellants Aaron M. Jacobs and John A. McIntyre.

Burton I. Weinstein, Paul M. Lurie, and Robert A. Holstein, Chicago, for appellants Bonita Weinstein and John Lazare, Jr.

Robert S. Cushman and Thomas E. Brannigan, Chicago (Price, Cushman, Keck & Mahin, Chicago, of counsel), for appellant Sherwin Williams.

Richard L. Curry, Corp. Counsel, William R. Quinlan, Gayle E. Haglund, and Frank G. Sulewski, Asst. Corp. Counsels, Chicago, for appellees. RYAN, Justice.

This appeal concerns the constitutionality of the Chicago Parking Tax Ordinance (Municipal Code of Chicago, ch. 156.1 et seq.) which became effective January 1, 1972. The plaintiffs in three separate suits, on behalf of themselves individually and as representatives of a class, challenged the validity of the ordinance in the circuit court of Cook County. The cases were consolidated and the defendants filed a motion to dismiss the complaints. The court found that the provision of the ordinance exempting certain residential parking from the tax imposed was invalid as an unreasonable classification. However, the court found that the invalidity of the exemption did not render the entire ordinance invalid and dismissed the complaints. The plaintiffs appealed to the appellate court and the defendants cross-appealed from that portion of the decree declaring the residential parking exemption invalid. On motion, the appeal was ordered transferred to this court pursuant to Rule 302(b), 50 Ill.2d R. 302(b), Ill.Rev.Stat.1971, c. 110A, § 302(b).

The parking tax ordinance was adopted by the City of Chicago under the home-rule powers conferred by section 6 of article VII of the constitution of 1970. The ordinance provides: 'There is hereby levied and imposed upon the use and privilege of parking a motor vehicle in or upon any parking lot or garage * * * a tax * * *.'

The exemption complained of is found in two separate sections of the ordinance. Section 1, which contains the definitions of 'parking lot' or 'garage', provides: 'however, that said terms shall not include residential parking provided for single-family homes or multiple-family dwelling units wherein an arrangement for such parking is provided on a rental basis to meet the terms of the Chicago Zoning Ordinance for off-street parking, the consideration thereof being set forth in the house or apartment lease or in a separate writing between the landlord and the tenant, * * *.'

The other reference to the exemption is contained in section 2(c) which provides: 'The tax imposed by this chapter shall not apply to residential off-street parking of house or apartment tenants required by the Chicago Zoning Ordinance, wherein an arrangement for such tenant parking is provided in the house or apartment lease or in a separate writing between the landlord and tenant, * * *.'

Plaintiffs contend that the tax is actually an attempt by the City to license for revenue. They point out that section 6(e) of article VII of the constitution of 1970 provides: 'A home rule unit shall have only the power that the General Assembly may provide by law * * * (2) to license for revenue * * *.' Since the General Assembly has not provided by law authority for home-rule units to license for revenue they contend that the tax is invalid. The basis of this contention is that the ordinance requires the operator of parking facilities to collect the tax and remit to the city collector. If, following a hearing, it is determined that a person has wilfully failed to pay over any tax, the ordinance authorizes the mayor to suspend or revoke any city license held by the operator.

Contrary to plaintiffs' contention, the tax is not a license for revenue. It is not a tax upon the operator of the parking facility. Section 2(b) provides that the ultimate incidence of and liability for the tax is to be borne by the person who seeks the privilege of occupying the space within the parking facility. The duty of collecting and remitting the tax imposed by section 2(d) only makes the operator the agent of the city for the purpose of collecting the tax. (Hayman v. Mahin, 49 Ill.2d 284, 289, 275 N.E.2d 421, cert. denied, 405 U.S. 1075, 92 S.Ct. 1499, 31 L.Ed.2d 809.) The penalties provided in the ordinance for defalcations do not convert the collection system into a license for revenue. Such penalties 'are but provisions to insure the integrity of the collection procedures.' (S. Bloom, Inc. v. Korshak, 52 Ill.2d 56, 63, 284 N.E.2d 257, 262.) The tax is one imposed pursuant to the home-rule power 'to tax' conferred by section 6(a) of article VII of the constitution of 1970 and is not an attempt to exercise the restricted power to license for revenue referred to in section 6(e) of article VII of the constitution of 1970.

The plaintiffs contend that for several reasons the exemption of residential parking violates the equal-protection clause of the State and Federal constitutions. One argument is that the exemption does not apply to parking by office, commercial and industrial tenants and is therefore violative of the equal-protection clause. The powers of a legislative body to make classifications, particularly in the field of taxation, are very broad and the classifications must be upheld if any state of facts reasonably can be conceived that would sustain them. (Thorpe v. Mahin, 43 Ill.2d 36, 45, 250 N.E.2d 633; Midwest Freight Forwarding Co., Inc. v. Lewis, 49 Ill.2d 441, 445, 275 N.E.2d 388.) Furthermore, there is a presumption in favor of the validity of the classification made by the legislative body and one who assails it has the burden of proving the classification to be arbitrary. Zoning ordinances have long distinguished between residential, business, commercial and industrial uses and such common classifications are not invalid. A reasonable basis exists for the distinction between these classes. Aside from charging that business, commercial and individual tenants must pay the tax while residential tenants do not, the plaintiffs have not indicated in what manner this classification is arbitrary. We find the classification to be reasonable.

The plaintiffs posit several hypothetical situations which they contend demonstrate the discriminatory nature of the tax. They contend that there are many houses and apartment buildings which were erected before the present Chicago Zoning Ordinance was enacted which are not required to provide off-street parking facilities for the tenants but do provide such facilities for a fee. Plaintiffs argue that these tenants would be required to pay the tax because the exemption is limited to off-street parking facilities required by the Chicago Zoning Ordinance. Thus, they contend, one group of residential tenants would be exempt from the tax while another would be...