Local and state taxing agencies cannot grant a property tax exemption to Elliott Aviation until a Rock Island County judge has time to consider the merits of a lawsuit that is challenging the tax break.
Circuit Judge Frank Fuhr wrote in an order filed Friday that a preliminary injunction granted to the Moline-Coal Valley School District will be in effect until a further order of the court.
Fuhr’s order comes less than a month before a law takes effect that will exempt Elliott Aviation from paying taxes on the property it leases at the Quad-City International Airport and on any future improvements it makes to the property.
The district filed suit in March seeking to challenge the constitutionality of the law, which the district said will result in the loss of a minimum of $150,000 in property tax revenue each year.
Attorneys for the district argue that the law, signed by Gov. Pat Quinn on Feb. 1, violates a section of the Illinois Constitution that prohibits the Legislature from granting property tax exemptions for private, for-profit companies.
The law was sponsored by state Sen. Mike Jacobs, D-East Moline, state Rep. Pat Verschoore, D-Milan, and former state Rep. Rich Morthland, R-Cordova.
The company and Quinn jointly announced March 4 plans for a $1.8 million expansion of Elliott Aviation's Moline headquarters that will happen over the next two years. The company also said it will add 50 jobs.
The suit names as defendants Quinn; the Illinois Department of Revenue and its director, Brian Hamer; the Rock Island County Board of Review and members Dan DePorter, Joan Russell and Dick Schroder; Larry Wilson, the Rock Island County chief county assessment officer; the Rock Island County chief assessor; Winna Pannell, Blackhawk Township assessor; Rose Booker, Coal Valley Township assessor, and Rock Island County.
A motion to dismiss Quinn as a defendant has since been filed.
The Coal Valley Fire Protection, which says it will lose $15,000 a year, has been allowed to intervene in the district’s suit.
Elliott Aviation has not been named in the suit nor has it filed a petition to intervene.
Fuhr wrote in his order that the district has a “clearly ascertainable right to protect its tax basis and it will suffer irreparable harm if defendants are permitted to exempt from real property taxation those for-profit leasehold interests proved in the Act” to Elliott Aviation.
The temporary injunction, he wrote, merely preserves the “status quo” of the rights of all parties in the suit and created “no monetary risk” for any of the defendants.
Attorneys for the state attorney’s general’s office argued in court documents that the district has not sought relief from either county or state taxing agencies and that filing a lawsuit at this point is premature.