Find Court Cases > Go Back to List > Riverside Medical Center v. Department of Revenue

Riverside Medical Center v. Department of Revenue

Case Date: 07/30/2003
Court: 3rd District Appellate
Docket No: 3-02-0590, 3-02-0602  Cons.Rel

Nos. 3--02--0590, 3--02--0602 cons.


APPELLATE COURT OF ILLINOIS

THIRD DISTRICT

A.D., 2003


RIVERSIDE MEDICAL CENTER, an ) Appeal from the Circuit Court
Illinois not-for-profit ) for the 21th Judicial Circuit,
corporation, ) Kankakee County, Illinois
)
               Plaintiff-Appellee, )
) No. 01--MR-950
               v. )
)
) Honorable Fred S. Carr, Jr.,
THE DEPARTMENT OF REVENUE OF ) Judge, Presiding
THE STATE OF ILLINOIS and THE )
KANKAKEE COUNTY BOARD OF )
REVIEW, )
)
               Defendants-Appellants.  )

PRESIDING JUSTICE McDADE delivered the opinion of the court:

In this appeal, the defendants, the Illinois Department ofRevenue and the Kankakee County Board of Review, seek review ofthe decision of the Kankakee County circuit court granting theplaintiff, Riverside Medical Center, a charitable exemption fromproperty taxes under section 15--65 of the Property Tax Code (35ILCS 200/15-65 (West 2000) for clinics it owns in Bourbonnais,Maneto and Momence. The defendants argue that the subjectproperties do not meet the requirements for an exemption. For thefollowing reasons, we reverse the order of the circuit court ofKankakee County and confirm the decision of the IllinoisDepartment of Revenue.

FACTS The plaintiff, Riverside Medical Center, is a not-for-profitcorporation that owns a hospital and eight clinics in and aroundKankakee. Three clinics are located in Bourbonnais, Momence andManeto. Riverside applied to the Illinois Department of Revenue(the Department) for property tax exemptions for these clinicsfor 1998 on the basis that the properties were used forcharitable purposes. The Department granted the exemptions,except for portions that were rented out to private physicians.Following the Department's determination, the Kankakee CountyBoard of Review requested a formal hearing.

The matter proceeded to an administrative hearing beforeadministrative law judge Alan Marcus. The parties stipulated thatthe only parts of the clinics that were potentially eligible foran exemption were those portions that had not been rented toprivate doctors. David Schroeder, the chief financial officer andtreasurer of Riverside Health System, was the only witness.

Schroeder testified to the corporate and financial structureof the Riverside system. Riverside Health Systems is a not-for-profit corporation that is exempt from federal income taxpursuant to section 501(c)(3) of the Internal Revenue Code of1954 (the Code) (26 U.S.C.