Northern Illinois Builders Ass'n v. City of St. Charles
Case Date: 07/06/1998
Court: 2nd District Appellate
Docket No: 2-97-0847
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No. 2--97--0847 _________________________________________________________________ IN THE APPELLATE COURT OF ILLINOIS SECOND DISTRICT _________________________________________________________________ NORTHERN ILLINOIS HOME BUILDERS ) Appeal from the Circuit ASS'N; GALLANT HOMES, INC.; THE ) Court of Kane County. KRUGHOFF COMPANY; SHO DEEN, INC.; ) JOE KEIM BUILDERS, INC.; KEIM ) CORPORATION; and HAVLICEK BUILDERS, ) INC., ) ) Plaintiffs-Appellants, ) No. 92--MR--0013 ) v. ) ) THE CITY OF ST. CHARLES, ) ) Defendant-Appellee ) Honorable ) R. Peter Grometer and (John R. Hall & Sons, Inc., ) Timothy Q. Sheldon, Plaintiff). ) Judges, Presiding. _________________________________________________________________ JUSTICE McLAREN delivered the opinion of the court: Plaintiffs Gallant Homes, Inc.; The Krughoff Company; Sho Deen, Inc.; Joe Keim Builders, Inc.; Keim Corporation; and Havlicek Builders, Inc., (collectively the Builders) and plaintiff Northern Illinois Home Builders Association appeal the trial court s dismissal of the plaintiffs' second amended complaint seeking a declaratory judgment that the defendant's ordinances mandating an electric service connection fee is unconstitutional and invalid. We reverse in part, affirm in part, and remand for further proceedings. Since 1892, the defendant, the City of St. Charles, a non- home-rule municipality, has operated its own electric utility system. The defendant, the sole provider of electrical current to residences within St. Charles, buys electrical energy from Commonwealth Edison at wholesale and distributes electricity to customers through facilities owned by the defendant. The defendant s electric utility system is financed by retained earnings, not by bonds. Prior to 1972 the cost of connecting new customers to the system was paid for by the income from the sale of electric energy. In 1990 the defendant adopted ordinance 1990-M-36 (the old ordinance) (St. Charles Municipal Code 13.08.150 (passed April 16, 1990)), which provided that the cost of connecting new customers to the system would be paid for by the new customers. Under this old ordinance, new customers paid one charge, which was based on standard increments of service capacity, i.e., $1,200 for 100 amps, $2,400 for 200 amps, $4,800 for 400 amps. In counts I and II, the plaintiffs alleged that the Builders built single-family residential homes within the defendant s corporate borders. The plaintiffs alleged that the Builders paid the connection fees assessed by the defendant when they obtained building permits. The complaint also alleged that the Builders had an ownership interest in the property when they paid the connection fees. Further, all the Builders, except The Krughoff Company and Havlicek Builders, Inc., alleged that they continued to have a property interest in the homes in which they paid the connection fees. The plaintiffs sought a declaration from the court that the old ordinance was invalid and an order for the return of the fees with interest. On January 7, 1992, the plaintiffs and John R. Hall & Sons, Inc., filed a complaint for declaratory judgment against the defendant. The complaint challenged the validity and constitutionality of the defendant s ordinance. The trial court denied the defendant s motion to dismiss, but then sua sponte requested that the plaintiffs and John R. Hall & Sons, Inc., amend their complaint. The plaintiffs and John R. Hall & Sons, Inc., filed an amended complaint for declaratory judgment on December 16, 1992. On December 21, 1992, the defendant adopted the new ordinance. On December 21, 1992, the defendant adopted ordinance 1992-M- 71 (the new ordinance) (St. Charles Municipal Code 13.08.135 (passed December 21, 1992)), which amended the old ordinance and charged new customers two separate charges for connection, namely, a service origination charge "of $1,500 plus four and one-half percent (4 |