Dusthimer v. The Board of Tustees of the University of Illinois

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State: Illinois

Court: 4th District Appellate

Docket No: 4-05-1034 Rel

Case Date: 10/27/2006

Preview:NO. 4-05-1034 IN THE APPELLATE COURT OF ILLINOIS FOURTH DISTRICT JACK E. DUSTHIMER, KATHY DUSTHIMER, and BRANDT DUSTHIMER, Plaintiffs-Appellants, v. THE BOARD OF TRUSTEES OF THE UNIVERSITY OF ILLINOIS, Defendant-Appellee. ) ) ) ) ) ) ) )

Filed 10/27/06

Appeal from Circuit Court of Champaign County No. 04MR446 Honorable Charles McRae Leonhard, Judge Presiding.

JUSTICE APPLETON delivered the opinion of the court: The plaintiffs are Jack and Kathy Dusthimer and their son Brandt. The defendant is the Board of Trustees of the University of Illinois. Jack and Kathy are helping pay Brandt's tuition at the university. (For clarity and ease of reference, we will use first names when referring to the plaintiffs individually.) Tuition would be cheaper if Brandt were a resident of Illinois. The university, however, has refused to classify him as a resident. Plaintiffs challenged the university's decision by filing a complaint for administrative review, which, with leave of the circuit court, they repleaded as an amended complaint for a writ of certiorari. After oral arguments, the court entered judgment in the board's favor. Plaintiffs appeal, arguing the university is violating its own regulation defining who is a "resident." We find no ambiguity in the regulation. In plain language, it defines a "resident" to include the dependent of someone employed at least a quarter of the time as a faculty member of a "state-supported institution[] of higher education in Illinois." University of Illinois

Residency-Status Regulations, par. K, at 3 (eff. Fall 1997). Given the undisputed facts in the record, we find that Brandt meets that definition: he is the dependent son of Kathy, who is on the faculty of Black Hawk College in Moline, an institution of higher education which the State supports financially. Therefore we reverse the circuit court's judgment and remand this case for issuance of the requested writ of certiorari. I. BACKGROUND In their amended complaint, which they filed in June 2005, plaintiffs allege they are residents of Iowa and that Kathy is employed at least a quarter of the time as a faculty member of Black Hawk College, "a state-supported institution of higher education." Brandt is her and Jack's dependent son. He has just finished his sophomore year at the University of Illinois in Urbana-Champaign, and they are contributing toward his tuition. The university has a regulation on the residency status of its students. Paragraph K of the regulation provides as follows: "Staff members of the [u]niversity and of allied agencies, and faculties of state-supported institutions of higher education in Illinois, holding an appointment of at least one-quarter time, and their spouses and dependent children, shall be treated as residents." University of Illinois Residency-Status Regulations, par. K, at 3 (eff. Fall 1997). The university denied Brandt's application for residency status under paragraph K and denied his administrative appeal. As a result, plaintiffs must pay the higher nonresident tuition. In its answer, the board denies that Black Hawk College is a "state-supported -2-

institution of higher education" and, therefore, denies that Brandt is eligible for resident tuition under paragraph K of the regulation. The board filed a certified record of the administrative proceedings. In the remaining paragraphs of this "Background," we will summarize the material documentation from the administrative record. On December 9, 2003, Darice Yonker of the Illinois Board of Higher Education sent Jack an e-mail quoting section 1(a) of the Board of Higher Education Act (110 ILCS 205/1(a) (West 2004)), which defined "'[p]ublic institutions of higher education'" to include "'the public community colleges of the State.'" On December 10, 2003, Bruce Bennett, assistant director for system finances at the Illinois Community College Board, sent Jack an e-mail stating: "Black Hawk College is a state[-]funded public institution of [h]igher [e]ducation in the State of Illinois." On December 16, 2003, Brandt signed a fill-in-the-blank application for residency status. In this form, he certifies he is the dependent child of Kathy, a faculty member of Black Hawk College, a state-supported institution of higher learning in Illinois. The third page of the form is a "Certificate of Appointment," signed by Gary A. Bibby, data and systems specialist of Black Hawk College, confirming that Kathy is on the faculty of the college. A "2003 Benefit Summary Statement" shows that Kathy is a participant in the State Universities Retirement System. The administrative record also includes a printout from a web page maintained by the marketing department of Black Hawk College showing that in 2003, the college received 35.4% of its revenue from State funds. Its annual budget was $30.6 million. On January 7, 2004, Gayle Laman, assistant director of university-wide student -3-

programs at the university, sent an e-mail to two other staff members of the university, Ira Langston and Marilyn Marshall. In this e-mail, she made the following inquiry: "I have a question that exceeds my history over here. I have a request from a father to grant resident tuition to his son based on the fact that the mother/wife is an employee of Black Hawk Community College in Moline. The family lives in Iowa. I know that the practice has been to limit resident tuition based on parental employment to four-year institutions--not community colleges. I believe we used the rationale that this was the same group of institutions covered in the [child-of-employee tuition waiver] (halfprice tuition). And I think we also used the rationale that [a fouryear] institution received state funding while community[-] college funding was regional. The father has sent me documentation that the state support of Black Hawk [College] is 35%--larger than our state[-]support percentage. And he has sent me a definition of 'public institutions of higher education' from the Illinois code that includes four-year[] and community colleges. I called Lisa Huson[,] who is doing some checking[,] but it looks [as if] we need to change our definition. Do either of you have any history to shed on this? Is there anything in writing on this topic that you recall?" On January 8, 2004, Marshall, of the university's office for planning and budget-4-

ing, replied to Layman with the following e-mail: "'State supported' was a key phrase Peter used when he and I coordinated the major revision of residency in the late [1980s] (?). I think we moved from [']state[-]assisted['] to [']state[-]supported['] in order not to capture the community colleges and private[] [institutions] that get state money. *** [C]ommunity colleges are considered []local units of government[] ***. *** Because community colleges do not receive most of their funding from the state, I don't think it was meant that their employees are to be treated as residents. The problem is that state support for public universities has fallen so much that I wonder [whether the *** employees [of the University of Illinois] would qualify; I don't know what the percentage is now. *** I would suggest trying to get the definition of 'state[-]supported.' It is around somewhere. I don't think it was a random phrase that was put together for the residency policy. Nonetheless, just because someone says a third of the funding (an unknown numerator over an unknown denominator) for Black Hawk [College] is state support, that doesn't make them 'state supported.' Their basis of funding is local, not state." (Emphasis in original.) -5-

In a letter dated March 18, 2004, Layman informed Jack that after "reviewing the policies and state law," the university concluded that Brandt was not a "resident" of Illinois within the meaning of paragraph K of the regulation and, therefore, he did not qualify for in-state tuition. According to her, "state-supported institutions of higher education" meant only state universities. She reasoned as follows: "[T]o compare the levels of funding between a community college and a campus of the University of Illinois, one should only compare the funding for instruction costs[,] since a community college's primary mission is instruction and it engages in comparatively little research, public service[,] or outreach. The instruction costs at our Urbana campus are entirely supported by state funds (50%) and tuition (50%). So, for comparison purposes, the state support for the instruction at [the university] is 50%. There is no definition in state statutes for the term 'statesupported[,]' as used in the [regulations,] and the [regulations] themselves provide no definition. Therefore, we must look to other statutory language and to the commonly understood use of the term 'state-supported' institution. Black Hawk [College] is a community college which is created generally under [the Public Community College Act (110 ILCS 805/1-1 through 8-2 (West 2004))]. There are a number of important differences between community colleges and State -6-

universities. State universities, such as the University of Illinois, are individually established by the Illinois legislature and draw their funding primarily from State appropriations. Community colleges are not individually created by the Illinois legislature, [but,] rather[,] are created by petition and referendum[] and are primarily funded through local[-]district tax funds. Consequently, community colleges are sustained on a local and not statewide basis, although they may get some state money in the form of grants. In fact, community[-]college boards are authorized to actually levy taxes for educational purposes and for the operation and maintenance of facilities. State institutions have no such authority and are dependent on the State legislature for their appropriations. Community[-]college boards set their own fiscal year and budget[] [and] select their own basis of financing and their own systems of accounting. [Citation.] Other statutes contemplate what tuition benefits employees of state-supported institutions receive. [Section 7f of the University of Illinois Act (110 ILCS 305/7f(b) (West 2004))] provides for a 50% tuition waiver to the children of employees of 'an Illinois college or university who have been employed by any one or by more than one Illinois college or university for an aggregate period -7-

of at least [seven] years.' Subsection (a) of section 7f defines 'Illinois college or university' as 'the University of Illinois, Southern Illinois University, Chicago State University, Eastern Illinois University, Northeastern Illinois University, Northern Illinois University, and Western Illinois University.' [110 ILCS 305/7f(a) (West 2004).] In conclusion, although it's true that Black Hawk [College] does receive some State money, it is not a 'state-supported' institution as contemplated in the [regulations]." Plaintiffs appealed to the director of admissions and the director of the office for academic policy analysis. They pointed out that while the University of Illinois received 31% of its total revenue from the State, Black Hawk College received 34% of its revenue from the State-showing that Black Hawk College was, in fact, more "state-supported" than the university. They argued that just because Black Hawk College received revenue from other sources, such as the local community, that fact did not negate its status as a state-supported institution, any more than the university's receipt of $500 million in federal funds negated its status as a state-supported institution. These arguments failed to carry the day, either in the university or circuit court. II. ANALYSIS A. Standard of Review Section 3-102 of the Administrative Review Law (735 ILCS 5/3-102 (West 2004)) empowers a court to review the final decision of an administrative agency if the statute "creating or conferring power on such agency, by express reference, adopts the provisions of -8-

[a]rticle III of [the Code of Civil Procedure, i.e., the Administrative Review Law (735 ILCS 5/3101 through 3-113 (West 2004)),] or its predecessor, the Administrative Review Act." Otherwise--unless the statute creating or empowering the agency prescribes some other form of review--the plaintiff must seek a writ of certiorari under the common law. Applegate v. Department of Transportation, 335 Ill. App. 3d 1056, 1061, 783 N.E.2d 96, 102 (2002), appeal denied, 204 Ill. 2d 656, 792 N.E.2d 305 (2003). The University of Illinois Act (110 ILCS 305/0.01 through 30 (West 2004)), which, in section 1 (110 ILCS 305/1 (West 2004)), creates the board of trustees, nowhere adopts the Administrative Review Law or prescribes any other form of review. In denying Brandt's application for classification as a resident, the university exercised quasijudicial power, adjudicating facts and individual rights. See Applegate, 335 Ill. App. 3d at 1061, 783 N.E.2d at 102. Therefore, the university's decision is reviewable in an action for a writ of certiorari. Our standard of review is the same as in actions under the Administrative Review Law. Applegate, 335 Ill. App. 3d at 1061, 783 N.E.2d at 102. Given the certified record of the administrative agency, we ask whether the factual findings and conclusions of the agency are against the manifest weight of the evidence. O'Boyle v. Personnel Board of Chicago, 119 Ill. App. 3d 648, 653, 456 N.E.2d 998, 1002 (1983). In the present case, the material facts are undisputed, and we have no occasion to ask whether the factual findings of the university are against the manifest weight of the evidence. Only the meaning of the regulation is in dispute. The board argues "it is of tantamount importance that deference be given an administrative agency's own interpretation of the regulations which it has set forth." Rend Lake College Federation of Teachers, Local 3708 v. Board of -9-

Community College, District No. 521, 84 Ill. App. 3d 308, 311, 405 N.E.2d 364, 368 (1980). In its explication of our standard of review, however, the board overlooks the indispensable precondition of deference: ambiguity. We will defer to an agency's interpretation of its regulation only if the regulation is ambiguous (Hetzer v. State Police Merit Board, 49 Ill. App. 3d 1045, 1047-48, 365 N.E.2d 261, 263-64 (1977))--that is, only if reasonably well-informed persons could understand the regulation in more than one sense (Illinois Bell Telephone Co. v. Illinois Commerce Comm'n, 362 Ill. App. 3d 652, 657, 840 N.E.2d 704, 709 (2005)). The board is correct that a reviewing court should overturn an agency's interpretation of its own regulation only if the interpretation is "'clearly erroneous.'" Cotter & Co. v. Property Tax Appeal Board, 277 Ill. App. 3d 538, 542-43, 660 N.E.2d 1283, 1285 (1995), quoting LaBelle v. State Employees Retirement System, 265 Ill. App. 3d 733, 735-36, 638 N.E.2d 412, 415 (1994). But "plainly erroneous" means "contrary to the clear language of the provision." Ress v. Office of the State Comptroller, 329 Ill. App. 3d 136, 142, 768 N.E.2d 255, 260 (2002). When we defer to an agency's interpretation, our justification for doing so is the agency's experience and expertise (LaBelle, 265 Ill. App. 3d at 735, 638 N.E.2d at 415), but all the experience and expertise in the world cannot change what a regulation plainly says. If the regulation is unambiguous, "that is the end of the matter" (Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842, 81 L. Ed. 2d 694, 703, 104 S. Ct. 2778, 2781 (1984)), and deference goes out the window. "'"[O]nly as the interpreter of a doubtful law"'" does an agency deserve deference. Hetzer, 49 Ill. App. 3d at 1047, 365 N.E.2d at 263, quoting Whittemore v. People, 227 Ill. 453, 471, 81 N.E.2d 427, 433 (1907), quoting 2 Lewis' Sutherland on Statutory Construction

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