Legal/Legislative Scene

In his second budget message, and amid cries of Edgar Scissorhands emanating from the House of Representatives gallery, Governor Jim Edgar called for $350 million in budget cuts. This translated into a call for a 7 percent cut across the board for all State agencies.

The general revenue funds allocated to the Illinois Department of Conservation (DOC) this year for FY 1992 have already been slashed 11.5 percent. If the cuts the Governor calls for are enacted, the DOC will lose significant additional dollars from the remaining dollars in its budget; however, sites are not expected to be closed as a result.

Lawmakers are expected to address the budget shortfall as the first order of business during the 1992 legislative session which kicked off Jan. 8.

Senate Bill 1283, as introduced last spring, severely limited forest preserve districts from acquiring land for trails and greenways.

Governor Edgar amendatorily vetoed SB 1283 in order to make it palatable to forest preserve districts. However, Speaker Madigan's legal counsel ruled the bill "out of compliance." That is, the Governor's amendatory veto went too far in the view of the House Rules.

Thus, SB 1283 died. But, the General Assembly often provides opportunities for resurrection. Rep. Larry Wennlund (R-84) amended the text of the bill (as the Governor had reworked it) onto a conference committee report for SB 922. This bill passed, so the provisions of the Governor's veto are in effect. Many trail projects are still alive thanks to the Governor's changes.

The Department of Conservation will again accept applications for the Bike Path Grant Program between Jan. 1 and March 1, 1992. The program, established in 1990 through the efforts of the IAPD, assists eligible local units of government with the acquisition and/or construction and rehabilitation of bicycle paths.

Funded by a portion of the motor vehicle title fees, the program operates on a reimbursement basis and provides up to 50 percent funding assistance on approved project costs. Maximum grant awards for development projects are limited to $200,000 per annual request, and no maximum exists for acquisition projects.

Evaluation of the applications is on a competitive basis according to criteria set by the DOC. Eligible project costs include linear corridor acquisition costs, and bicycle path development or renovation including site clearing and grading, drainage, surfacing, bridging, fencing, signs, and other related support facilities.

Requests DOC to rename the undeveloped Shallow Brook property known as Shallow Brook State Park as Mautino State Park in honor of late Rep. Richard Mautino.

Amends Property Tax Extension Limitation Act; exempts levies for payments into the Illinois Municipal Retirement fund.

Amends Property Tax Extension Limitation Act; exempts levies by public school districts for purposes of fire prevention, safety, energy conservation and school security.

Amends Chicago Park District Pension Article; allows active and retired employees to purchase service credit for up to 2 years of military service beyond that currently allowed.

Amends School Code and State Finance Act; provides, subject to referendum, levying of a local school's income tax within educational service regions and the City of Chicago; requires corresponding dollar-for-dollar reduction in school district property taxes.

Amends Revenue Act; allows taxing districts to provide for abatement of taxes on homestead property of senior citizens who provide personal services to the taxing districts.

Creates the Tax Freedom Act; provides that no taxing district, including home rule units, may adopt a property tax levy in excess of their levy in 1987, excluding levies for bonded indebtedness incurred prior to the effective date of the Act; many other provisions.

Amends Property Tax Extension Limitation Act to make it applicable to counties with 2 million or more population.

Amends Revenue Act; provides for a senior citizens tax freeze homestead exemption, subject to certain income restrictions.

Amends Public Utilities, Gas Revenue Tax, Public Utilities Revenue and the Telecommunications Excise Tax Acts; exempts school districts, park districts and libraries from state utility taxes.

NOTE: The passage of the Property Tax Extension Limitation Act, P.A. 87-17, changes the deadline for park district tax levy filing from the third Tuesday in December to the last Tuesday in December. For 1992, this would make the filing deadline December 29. This is now the uniform filing date for all units of local government statewide.

Three additional special programs have been scheduled for the IPR Conference addressing the tax cap issue and how to deal with it. These sessions are as follows:

Friday, Feb. 7 — 8:30-9:45 a.m.
Forum Room
How to Pass a Referendum in the 1990s.

Presenters: Dr. Bud DesCarpentrie, Superintendent, School District No. 21 - Front Stage Referendum Issues; Mr. Bob Gerry, Director of Assessments, School District No. 21 - Back Stage Referendum Issues; Mr. Thomas C. White, Director of Parks & Recreation, Bartlett Park District - Successful Referendum Experience.

Moderator: Mr. David F. Phillips, Vice President/Director of Marketing, Speer Financial, Inc. (This session was organized by Speer Financial, Inc.)

This session presents an opportunity for group discussion on the recently passed Property Tax Extension Limitation Act. Strategies for confronting the tax cap, prospects for amending the existing law and new legislation on the horizon which impacts the taxing ability of local government will be discussed.

Speakers: Peter M. Murphy, IAPD General Counsel, Kathy Cassens and Don Jessen, JLC Co-Chairs.

On behalf of NRPA, Sen. Dennis DeConcini, Chairman of the Senate Subcommittee on Patents, Copyrights and Trademarks, requested clarification from the U.S. Copyright Office regarding copyright music liability/exemption for public parks. The November 6 response from Dorothy Schrader, General Counsel of the U.S. Copyright Office, states that "[u]nder appropriate circumstances, the public parks would have no copyright liability under existing law."

Specifically, Counsel notes that pursuant to section 110(4) "'non-profit' performances of non-dramatic music are exempt if the performers, promoters, or organizers of the event are not paid and if there is no direct or indirect admission charge." Further, Counsel states that "[g]iven if admission is charged, the performance can be exempt [under section 110(4)] if the proceeds are used exclusively for charity." Under such circumstances, Counsel would similarly find public park and recreation functions exempt under section 110(4) assuming that "the proceeds from events at public parks would be devoted to educational-charitable purposes." According to Counsel's analysis, public parks would be considered a charitable organization within the meaning of the section 110(4) exemption.

Accordingly, pursuant to Counsel's analysis, the law would rarely require the payment of licensing fees for the use of copyrighted music from public park and recreation events and activities which charge admission fees. Specifically, such events would be exempt under section 110(4) where it can be shown that any revenues generated are used exclusively for the educational-charitable purposes inherent in the vast majority of public park and recreation programs. On the other hand, Counsel acknowledged this section 110(4) exemption may not apply to public parks under rather limited circumstances where "performers are paid, then creators should be paid for the use of their music, even in an otherwise non-profit context."

While Counsel's opinion regarding the applicability of the section 110(4) exemption to public park and recreation functions does not have the force of law, it reflects an unbiased, reasonable and authoritative interpretation of federal copyright law upon which public park and recreation agencies can justifiably rely. In a worse-case scenario involving the unlikely imposition of copyright liability, a defendant public park and recreation agency could certainly offer this opinion by the General Counsel of the U.S. Copyright Office to support its defense claim to a section 110(4) exemption.

Further, in the unlikely event of a judgment imposing copyright liability, this opinion could be offered to establish an innocent infringement whereas the statutory maximum for willful infringement is $50,000.

The Surface Transportation Act was signed by the President into law on December 18, 1991.

The trails version put together by Sen. Steve Symms of Idaho was approved, meaning $30 million per year for the next six fiscal years for trails. States are now lining up to receive $10 million more for trails each year than they would have under the LWCF. The fund will be administered by the Department of Transportation in consultation with the Department of the Interior.

Scenic byways also were included in the Transportation bill with an interim program for eligible projects at up to $10 million per year for fiscal years 1992, 1993 and 1994. It also establishes a permanent grants program at $1 million in fiscal 1992, $3 million in fiscal 1993, and $4 million in fiscal 1994, with $14 million each in fiscal years 1995 through 1997.

Bicyclists were also enthusiastic about the legislation which created a special bicycling and pedestrian transportation program whereby state and local plans give priority to bicycle lanes plus the inclusion of bike lanes in a $3.3 billion pot of money over a six year period. That same $3.3 billion includes conversion of railroad rights-of-way to bike paths.

With only $20 million in state and local grants provided this year under the LWCF, we are looking at 1992 action in Congress. It is reported that OMB is pushing for more money for LWCF for fiscal 1993 with emphasis on the state side. Interior may not support this, so the battle lines will be drawn.

With the $7-8 billion allocated to the LWCF from offshore oil used to balance the budget, one idea which has surfaced is to take the difference between the LWCF authorization of $900 million and the usual appropriation of about $300-350 million and let it draw interest with the interest added to the LWCF portion. Others are looking to President Bush to keep his 1988 campaign promise to produce a new recreation endowment. This will be a prime issue in 1992.

S. 340 (Johnston) was defeated in the Senate by a close vote, but Sen. J. Bennett Johnston can ask for a re-hearing on his measure to permit oil and gas development in the Arctic National Wildlife Refuge. HR 1320 (Jones), a similar measure, is alive in the House.

The Administration's proposed definition of wetlands has aroused opposition from many quarters. Up in Congress are S. 2018 (Bond) which would make one agency the referee on wetlands decisions, and HR 3578 (Brown) which would order a study of the definition's impact by the National Academy of Sciences. Another measure, HR 1330 and S. 1436 would narrow the definition of a wetlands. HR 1330 has 168 House members co-sponsoring it.

...proposed mandatory health insurance legislation and/or the possibility of a health reform plan by the Bush Administration.

LEGAL/LEGISLATIVE SCENE

Commentary
by Peter M. Murphy, Esq.

Anti-Local Government Sentiment: Prairie Fire or Political Posturing?

As the new legislative year gets underway it is appropriate to take stock of the issues which will come before the Illinois General Assembly during 1992. Clearly, last year local government became the whipping boy for many politicians desiring to posture themselves for success after the legislative remap. The immunity from negative legislation enjoyed by local government in the past 10 years is quickly eroding.

The message certainly seems to be that the woes of state government are not to be borne alone and that local government will be the target in order to avoid focus on state revenue issues. Certainly, the Illinois Department of Revenue has more pressing challenges to address than orchestrating an all-out attack on the financial and fiscal practices of Illinois local government.

Are there that many taxpayers who don't realize that of all the taxes they pay, local property taxes are the only that are returned to the communities in which they live in the form of direct services and capital improvements—that these expenditures have a direct correlation to the quality of life?

Are the majority of individuals who have been satisfied with the services they receive locally rising up in revolt? I think not. Satisfaction usually breeds silence.

Must local government do more to explain its purposes, programs and future plans? Yes, because there are some that will argue in the coming year that local government, particularly those local governments that are considered special districts, are shadow governments with elected boards that no one votes for and meetings that no one attends and that these governments are self-perpetuating for no discernible reason or purpose.

A recent editorial by Illinois Comptroller Dawn Clark Netsch, entitled Streamlining Government: Fewer local entities would deliver services more efficiently, sets the stage for not only her political platform as a potential gubernatorial candidate but also for an all-out assault against local government during 1992. Her article, after citing the fact that Illinois has 6,627 units of local government of which 5,926 have the power to impose property taxes of nearly $9 billion per year, raises the following questions: Do we really need some 6,000 units of local government to preserve democracy in Illinois although it is arguable that local governments are closer to the people and, therefore, more accountable?

Is it really possible for Illinois citizens to keep account of 6,000 governmental units?

Can so many separate entities efficiently and frugally deliver essential government services?

Are critics correct in charging that the services of special districts are just plain unnecessary? Is the argument sound that services are delivered inefficiently through the smaller disconnected local governments?

Is there enough elected and appointed fiscal know-how and talent to manage the nearly 6,000 taxing districts?

These questions and others like them need to be addressed by every member park district, not only to their state legislators, but to their community at large. It is time that we let the State Legislature know of the tremendous grassroots support that Illinois park and forest preserve districts enjoy.

The hundreds of thousands of Illinois citizens who use our parks and enroll in recreational programs are not part of the tax revolt if there ever was one to begin with.

Our agencies enrich the lives of so many people that to criticize and explain them as inefficient, disconnected or unnecessary is not only blatantly wrong, but is also just plain unfair.

However, this issue provides great political fodder for any politician irresponsible enough to take it on.

The lessons of the tax cap should not be forgotten. Many legislators bought into the simple concept of a tax cap and the benefits that it would bring politically, but no legislators ever discussed, considered or reacted to the crippling effect this legislation has on the infrastructure of all local government by eliminating these units' non-referendum bonding ability which has been a stable source of funding infrastructure maintenance and repair.

No legislator discussed the fact that this multi-million dollar investment by Illinois local government will be eliminated, and, as a consequence of being eliminated, those jobs and small businesses in Illinois that provide the materials for development and infrastructure maintenance will have their personal incomes and business revenues slashed.

While the call to consolidate and streamline local government will sell well, it is up to every elected park commissioner and park professional to speak out loudly against this threat to Illinois' park and forest preserve districts.

It is time to stand up and be counted. It is time to have those individuals who are satisfied with the way park districts are funded to speak out.

It is time to tell the legislature that local government will not be the fall guy in 1992.