Hospital Tax Case Updates

The Illinois Supreme Court recently upheld an exemption that has kept certain tax money collected by local governments in a legal limbo during litigation. What that means for local and county governments is still up in the air pending further litigation that will ride on the courts ruling on the nitty gritty from this decision. The lack of a definitive resolution was explained in a News-Gazette article last week:

Illinois Supreme Court upholds hospital tax-exemption law
An Illinois Supreme Court ruling upholding the state's 6-year-old hospital tax-exemption law is being viewed as a win for both nonprofit hospitals and taxing districts, but it remains to be seen how it will play out in the Carle Foundation's pending lawsuit over property taxes in Champaign County.

The state Supreme Court on Thursday morning unanimously affirmed a First District Appellate Court ruling that upheld the constitutionality of the state law that created new standards for nonprofit hospitals to obtain exemptions from paying property taxes in their communities.

Full article here. Naturally, both the hospital and the taxing authorities seem to think they'll be victorious (at least in their public posturing) in upcoming litigation on the matter. From today's News-Gazette:

Illinois' charity care statute was upheld, but are hospitals really the winner?
...
Steve Pflaum, the Chicago lawyer representing Carle, said it's easy to focus on the longstanding controversy in Champaign County over hospital tax exemptions, when, in fact, hospitals have a long history in Illinois of being tax-exempt and the state constitution hasn't changed.

Pflaum doesn't see any ambiguity in the Supreme Court decision about what hospitals need to do to meet the constitutional test, he said, and he sees Carle being in a solid position heading to trial...

Fred Grosser, the attorney representing Urbana and Cunningham Township in the Carle lawsuit, contended hospitals are going to have to show considerably more than whether they serve everyone regardless of ability to pay to meet the constitutional standards.

He views the Supreme Court's decision as about a 90 percent win for taxpayers and taxing districts, he said.

"Contrary to the claims of Carle and the Illinois Hospital Association, this decision is devastating to them," Grosser said.

Full article here. A local law professor quoted in the article appeared to explain that the courts will still have to figure out how to legally apply the legalese... or something. I leave it to adventurous readers to figure it all out at the original articles. UPDATE: Another article previewing where the both sides of the case are in light of some of the trial judge's input: Judge seeks to clarify how state Supreme Court ruling applies to Carle tax case.