People ex rel. Scoon v. Chicago & A.R. Co.

• Decision Date: 17 February 1912
• Citation: 253 Ill. 191,97 N.E. 310
• Court: Illinois Supreme Court
• Parties: PEOPLE ex rel. SCOON, County Collector, v. CHICAGO & A. R. CO. et al.

253 Ill. 191

97 N.E. 310

PEOPLE ex rel. SCOON, County Collector,

v.CHICAGO & A. R. CO. et al.

Supreme Court of Illinois.

Dec. 21, 1911.

On Petition for Rehearing, Feb. 17, 1912.

Appeal from Marshall County Court; D. H. Gregg, Judge.

Proceeding by the People, on the relation of Charles Scoon, County Collector of Marshall County, against the Chicago & Alton Railroad Company and others. From a judgment for defendants, plaintiff appeals. Affirmed.Henry Jacobs, State's Atty., and J. A. Riely, for appellant.

Silas H. Strawn, Winston, Payne, Strawn & Shaw, and R. Magoon Barnes, for appellees.

CARTWRIGHT, J.

[1] The city council of the city of Toluca, in Marshall county, passed an ordinance for an extensive system of sidewalks, to be paid for by special assessment. In the proceeding instituted in the county court for the purpose of assessing benefits, the city was assessed $8,110.14 for public benefits, and the balance of the cost of the improvement was assessed to owners of property. Bonds were issued by the city for the amount assessed to it, to be paid by general taxation. The city was then indebted in excess of 5 per centum of the value of the taxable property therein, as ascertained by the last assessment for state and county taxes previous to the issue of the bonds. In 1910 a tax was levied for the payment of $4,000 of the bonds and $240 interest, to which was added 2 per cent. of the bond and interest levy, amounting to $85. The right of way of the appellant the Toluca, Marquette & Northern Railroad Company was delinquent for this tax, and the other appellant, the Chicago & Alton Railroad Company, having purchased the railroad, objections were filed in the name of both railroad companies to the application of the county collector to the county court for judgment. The facts were stipulated, and it was agreed that there was only one question to be decided in the case, which was whether the amount assessed against the city, and for which the bonds were issued, was a part of the 5 per cent. indebtedness specified in section 12 of article 9 of the Constitution. It was agreed that if the bonds were an indebtedness, within the meaning of the Constitution, the tax was to be held void; but if it was not to be so considered the tax was to be held good. The court decided that the amount remaining unpaid, for which bonds of the city were issued, was a debt of the city in the sense of the constitutional limitation, and that the tax was void for that reason. Judgment was refused, and appellant excepted and appealed to this court.

The prohibition of the Constitution is against voluntarily incurring an indebtedness in any manner or for any purpose, and it makes no difference under what guise the attempt is made or what form the proceeding takes. The object is to protect the property of citizens from being burdened beyond 5 per cent. of its value, as ascertained by the assessment for state and county taxes, with any indebtedness extending into the future, and any plan or scheme which has the effect of creating such a burden is prohibited by the Constitution. The prohibition is not against the rate of a tax, and does not limit the rate of taxation, by which improvements may be made, or the obligations of the municipal corporation be met. Village of East Moline v. Pope, 224 Ill. 386, 79 N. E. 587;Schnell v. City of Rock Island, 232 Ill. 89, 83 N. E. 462,14 L. R. A. (N. S.) 874.

[2] The General Assembly has power to authorize municipal corporations to raise moneys by taxation sufficient for the performance of all their duties, including the making of local improvements. Accordingly, when the question whether the fact that a city had already reached the limit of indebtedness could be shown to prevent the confirmation of an assessment for a local improvement to be paid for in part by general taxation came before the court in Jacksonville Railway Co. v. City of Jacksonville, 114 Ill. 562, 2 N. E. 478, the court decided that it could not. That was an appeal from a judgment confirming a special assessment, and an objector had offered to show, on the trial in the county court, that the indebtedness of the city exceeded the constitutional limitation. On the appeal it was contended that the ordinance was void as creating an indebtedness, but the court said that no question as to the power of the city to incur a debt was presented by the record, and said: ‘It does not appear from anything before us that the city has ever asked any one to credit it on account of the proposed improvement. It has not incurred a debt in respect to it; nor is it threatening to do so. The city simply proposes to raise its share of the expenses by general taxation. It is not even attempting to anticipate a tax levy. Should it fail to raise the money in the manner proposed, and it should then attempt to borrow it or to hire some one to do the work on the city's credit, then, upon the complaint of a taxpayer, the constitutional provision referred to might be invoked, but until then no question of that kind can arise. It may be assumed that if the city finds it cannot raise its share of the necessary funds by taxation, as contemplated in the ordinance, it will abandon the emterprise altogether, rather than attempt to raise it in violation of the Constitution.’ The city of Jacksonville was not prohibited by the Constitution from raising money by taxation to make a local improvement. The fact that a municipal corporation has incurred an indebtedness up to the full limit allowed by the Constitution does not preclude it from levying taxes for any legal corporate purpose within the limits fixed by the statutes, and that rule was applied to a tax for building a schoolhouse, in People v. Chicago & Texas Railroad Co., 223 Ill. 448, 79 N. E. 151; but every municipal corporation is prohibited, in the language of the Constitution, from borrowing money or becoming indebted beyond the...