May 16, 2001

No. 2--00--0177, 2--00--0178 cons.

JUSTICE McLAREN delivered the opinion of the court:

The defendants, the Illinois Property Tax Appeal Board (PTAB)and the De Kalb County Board of Review (De Kalb Board), appeal theorder of the trial court reversing the PTAB's decision upholdingthe reassessment of the property of the plaintiff, Frank E. Paciga. This court consolidated the defendants' separate appeals. Weaffirm.

Prior to 1997, Paciga's property, 23.59 acres in Kingston, DeKalb County, Illinois, was assessed as farmland. Morespecifically, 3.15 acres of the parcel were assessed as "cropland"because they had been farmed in 1995, 1996, and 1997, and theremaining 20.40 acres (.04 acres of road were disregarded) wereassessed as "other farmland." See 35 ILCS 200/10--125(c) (West1996). This "other farmland" was wooded and was not farmed;however, Paciga had sold timber from these acres.

In accordance with section 10--125(a) of the Property Tax Code(Code), the "cropland" was assessed "in accordance with theequalized assessed value of its soil productivity index" adjusted(or debased) for certain factors. 35 ILCS 200/10--125(a) (West1996). "Other farmland" was assessed "at 1/6 of its debasedproductivity index equalized assessed value as cropland." 35 ILCS200/10--125(c) (West 1996). Based on this method, the totalassessed value of Paciga's land was $1,178 in 1996.

In 1996, Paciga subdivided his property into 14 lots, causingeach lot to become an individual parcel. Paciga also had a roadcut into the wooded acres to service the lots.

In 1997, the De Kalb Board valued the now subdivided propertyat $21,763, using a method different from that of previous years. The De Kalb Board assessed the property by calculating the marketvalue of the subdivided parcels, using the median sales ofcomparable farmland in 1996.

In response to the new assessed valuation, Paciga appearedbefore the PTAB, claiming overvaluation. Paciga argued thatsection 10--30(a) (35 ILCS 200/10--30(a) (West 1996)) of the Codeprohibited the increased assessed valuation. The PTAB disagreedand held that section 10--30(b) (35 ILCS 200/10--30(b) (West 1996))permitted the new assessed valuation because the land had beenplatted and subdivided. The PTAB reasoned that section 10--30(b)provided that platted and subdivided property must be valued bycalculating the property's market value as it was used prior toplatting. The PTAB then concluded that, except for the 3.15 acresthat had been cropland, the De Kalb Board properly assessed thevalue of the property using the market value of the farmland at$1,131 an acre. The 3.15 acres, the PTAB concluded, should havebeen assessed as agriculture.

Paciga filed an administrative review action, and the trialcourt reversed the decision of the PTAB, finding that the PTAB hadmisinterpreted the law and failed to apply the plain language ofsection 10--30(a) of the Code. 35 ILCS 200/10--30(a) (West 1996). The trial court remanded the matter for reassessment at theassessed value of the property prior to the platting andsubdividing.

On appeal, the PTAB and the De Kalb Board argue that the trialcourt improperly interpreted section 10--30 of the Code and erredby reversing the decisions of the PTAB and the De Kalb Board.

Section 10--30 of the Code provides:

"(a) In counties with less than 3,000,000 inhabitants,the platting and subdivision of property into separate lotsand the development of the subdivided property with streets,sidewalks, curbs, gutters, sewer, water and utility linesshall not increase the assessed valuation of all or any partof the property, if:

(1) The property is platted and subdivided in accordancewith the Plat Act [(765 ILCS 205/0.01 et seq.)];

(2) The platting occurs after January 1, 1978;

(3) At the time of platting the property is in excess of10 acres; and

(4) At the time of platting the property is vacant orused as a farm as defined in Section 1--60.

(b) Except as provided in subsection (c) of this Section,the assessed valuation of property so platted and subdividedshall be determined each year based on the estimated price theproperty would bring at a fair voluntary sale for use by thebuyer for the same purposes for which the property was usedwhen last assessed prior to its platting.

(c) Upon completion of a habitable structure on any lotof subdivided property, or upon the use of any lot, eitheralone or in conjunction with any contiguous property, for anybusiness, commercial or residential purpose, or upon theinitial sale of any platted lot, including a platted lot whichis vacant: (i) the provisions of subsection (b) of thisSection shall no longer apply in determining the assessedvaluation of the lot, (ii) each lot shall be assessed withoutregard to any provision of this Section, and (iii) theassessed valuation of the remaining property, when nextdetermined, shall be reduced proportionately to reflect theexclusion of the property that no longer qualifies forvaluation under this Section. Holding or offering a plattedlot for initial sale shall not constitute a use of the lot forbusiness, commercial or residential purposes unless ahabitable structure is situated on the lot or unless the lotis otherwise used for a business, commercial or residentialpurpose." 35 ILCS 200/10--30 (West 1996).

The fundamental principle of statutory construction is toascertain and give effect to the intention of the legislature. Lieb v. Judges' Retirement System, 314 Ill. App. 3d 87, 92 (2000). We must first look to the words of the statute as the bestindication of legislative intent. However, if the words used in astatute are ambiguous or if the meaning is unclear, the court mayconsider the legislative history as an aid to construction. Armstrong v. Hedlund Corp., 316 Ill. App. 3d 1097, 1106 (2000). Astatute is ambiguous if it is capable of two reasonable andconflicting interpretations. Tri-State Coach Lines, Inc. v.Metropolitan Pier & Exposition Authority, 315 Ill. App. 3d 179, 190(2000). Our supreme court further instructs courts that, "[i]f thelanguage of a statute is susceptible to two constructions, one ofwhich will carry out its purpose and another which will defeat it,the statute will receive the former construction." Harvel v. Cityof Johnston City, 146 Ill. 2d 277, 284 (1992). A court should notconstrue a statute in a manner that would lead to consequences thatare absurd, inconvenient, or unjust. McMahan v. Industrial Comm'n,183 Ill. 2d 499, 513-14 (1998). Further, a court should avoid aninterpretation of a statute that would render any portion of itmeaningless or void. McNamee v. Federated Equipment & Supply Co.,181 Ill. 2d 415, 422 (1998). We review a decision regarding theconstruction of a statute de novo. See Paris v. Feder, 179 Ill. 2d173, 177-78 (1997).

Applying these principles, we conclude that section 10--30 ofthe Code is ambiguous because it is susceptible to two conflictinginterpretations. Subsection 10--30(a) provides that the assessedvaluation of farm or vacant property larger than 10 acres will notincrease when it is platted, subdivided, and developed withstreets, etc. 35 ILCS 200/10--30(a) (West 1996). On the otherhand, subsection 10--30(b) seems to provide that the assessedvaluation of platted and subdivided property may increase everyyear because it is to be based on the estimated price the propertywould bring at a fair voluntary sale. 35 ILCS 200/10--30(b) (West1996). Thus, these two subsections seem to contradict each other. Because this section is capable of two reasonable interpretations,we now consider the legislative history and background of thestatute for clarification of the legislature's intent in enactingsection 10--30.

The sponsor of Senate bill 574, Senator Jerome Joyce,explained the purpose of the bill:

"This legislation is essentially intended to protect the realestate developers from rising assessments which result frominitial platting and subdividing farmland for real estatedevelopment. It's not uncommon for a real estate developer topurchase farmland for development site and then see theassessment double or triple. What this does is says that theywill not be...will not have that raise even though they mayput in curbs, and gutters, and...and sidewalks until they havesold the...the plat. We have seen what is [sic] happened toreal estate developers in the past couple of years and...theyare unable to sustain this...their development because of theincreased cost of taxes and this would hold that until theysold the property." 83d Ill. Gen. Assem., SenateProceedings, May 24, 1983, at 293 (statements of SenatorJoyce).

Later, Representative Slape repeated the general understanding ofthe purpose of the bill:

"And actually what the Bill says on the bottom line is, if aperson buys a tract of land of more than 10 acres and putscertain improvements such as water lines, streets or curb andguttering, that the assessment of that land shall not riseuntil he either sells the lot or he does development on thatproperty." 83d Ill. Gen. Assem., House Proceedings, June 24,1983, at 184 (statements of Representative Slape).

Representative Dennis Hastert declared the broader goal of thebill:

"I join with Representative Slape in asking for youraffirmative vote on this. This, indeed, does deal witheconomic recovery where builders are starting to plat land orbring land into...and start to build houses and get theeconomy going. This is an incentive for them that they're notgoing to have to come down with a big hammer on that landuntil, indeed, the house is sold. I think it's a positiveincentive and is a positive step towards economic recovery,and I ask for your positive vote on this." 83d Ill. Gen.Assem., House Proceedings, June 24, 1983, at 184-85(statements of Representative Hastert).

This background reveals a legislative purpose designed toprevent developers from having to pay increased taxes on farmlandor vacant land in the beginning of the development process. Instead, the assessment would remain the same until a house isbuilt or the property is used for a commercial purpose. Accordingly, we determine that the legislature's exclusive focus inenacting section 10--30 was to encourage developers to develop landthat had previously been used as farmland or had been vacant. Stated another way, the "particular evil" that section 10--30 wasintended to remedy was the imposition of a higher tax upon realestate property developers before they had the opportunity to reapthe benefits of their investments.

It follows then that subsection 10--30(a) applies tosituations like the one at bar, where a property larger than 10acres and previously classified as farm property has been plattedand subdivided with streets but no habitable structure has beencompleted on any lot nor is any lot used for any business,commercial, or residential purpose. Further, the language ofsubsection 10--30(c), interpreted with the aid of the legislativepurpose, reveals that no change in valuation will occur until ahabitable structure is constructed on one of the lots or one of thelots is used for any business, commercial, or residential purpose. At that time, the lot at issue will be assessed separately from theremaining lots. Subsection 10--30(b) then explains how theremaining lots are assessed, that is, "based on the estimated pricethe property would bring at a fair voluntary sale." 35 ILCS200/10--30(b) (West 1996). Therefore, subsection 10--30(b) appliesonly when one of the lots contains a habitable structure or is usedfor a residential, business, or commercial purpose. Absent such achange in use, subsection 10--30(a) applies to the entire propertyand the assessment valuation will not increase. 35 ILCS 200/10--30(a) (West 1996). Accordingly, the trial court properly reversedthe PTAB and the De Kalb Board and determined that the property atissue must be assessed at the assessed valuation prior to platting.

The PTAB and the De Kalb Board argue that subsection 10--30(b)defines "assessed valuation" as "the estimated price the propertywould bring at a fair voluntary sale for use by the buyer for thesame purposes for which the property was used when last assessedprior to its platting." However, the PTAB and the De Kalb Boardfail to recognize that subsection 10--30(b) describes only onemethod of assessed valuation. It is not meant to be the onlymethod. Obviously, the Code includes other methods of valuation,such as the methods previously used to assess Paciga's property;the equalized assessed value of cropland soil productivity (see 35ILCS 200/10--125(a) (West 1996)); and one-sixth of "otherfarmland's" debased productivity index value as cropland (35 ILCS200/10--125(c) (West 1996)). There is nothing in subsection 10--30(b) that indicates that the method described therein is the onlymethod of assessing property. Further, the interpretation offeredby the PTAB and De Kalb County disregards and abrogates thepreclusion of a change of assessment as indicated by the languagein subsection 10--30(a) and the legislative history. In addition,by interpreting the Code in such a way, the PTAB and De Kalb Countydefeat the purpose of the statute and render subsection 10--30(a)meaningless and void. Thus, we reject the interpretation of thePTAB and De Kalb County. See McMahan, 183 Ill. 2d at 513-14;McNamee, 181 Ill. 2d at 423.

Next, the PTAB and the De Kalb Board argue that the PTAB'sdetermination that the wooded tract was not in agricultural use wasnot against the manifest weight of the evidence. This argument ismooted by our determination that the PTAB misapplied section 10--30and failed to understand that nothing triggered the reassessment ofPaciga's property under subsection 10--30(b). Thus, according tosubsection 10--30(a), the assessed valuation was not to beincreased.

The PTAB and the De Kalb Board argue that the PTAB correctlyfound that the wooded area of Paciga's property had beenincorrectly assessed as farmland in the past and, thus, subsection10--30(a) does not bar an increased assessed valuation here. Wedisagree. The record indicates that the PTAB found only that thewooded area "was not utilized for an agricultural purpose in 1997." (Emphasis added.) It then decided that, unlike the 3.15 acrecropland area, it was not exempt from subsection 10--30(b). ThePTAB did not find that the wooded area had been incorrectlyassessed as farmland prior to platting. In fact, in applyingsubsection 10--30(b), the PTAB held that the De Kalb Boardcorrectly based the new assessment of the wooded area on the marketvalue of 1996 farmland sales. Thus, this argument fails.

For these reasons, the judgment of the circuit court of DeKalb County is affirmed.

Affirmed.

HUTCHINSON, P.J., and GROMETER, J., concur.