A county assessor decides a property no longer deserves its tax exemption and sends out a bill. The owner says the assessor had no business making that call in the first place. Who is right?
In Lincoln University v. Logan County, the Fourth District Appellate Court answered that question in favor of the property owner — and did it on the strength of a charter the Illinois General Assembly granted in 1865, while the man the school was named for was still in the White House.
The case matters well beyond Logan County. It draws a hard line around what a local assessor may and may not do, and it is a useful reminder that not every Illinois property tax exemption is the use-based kind most people picture.
What happened
Lincoln University — better known as Lincoln College — was incorporated by a special act of the General Assembly approved February 6, 1865. Section 9 of that charter provided that "[a]ll property, [of] whatever kind and description belonging or appertaining to the corporate body created by this act, shall be and forever remain free and exempt from taxation for any and all purposes whatever."
That language was permissible in 1865 because the Illinois Constitution of 1848 let the legislature hand out exemptions by special charter. The 1870 Constitution ended that practice. Institutions chartered after 1870 get only the use-based exemptions the legislature grants by general law — today, the provisions of the Property Tax Code covering schools and charities.
The college taught its last classes on May 13, 2022. It has been winding down since: transitioning students, completing audits, disposing of assets, paying liabilities. It still holds 21 properties.
Logan County's assessor's office honored the exemption through the 2022 tax year. In 2023 it changed course. The assessor took the position that the college was no longer exempt because it no longer provides educational activities, and in September 2023 sent assessment notices on all 21 properties. The treasurer intended to collect.
The college sued for a declaration that it "is and forever remains" exempt, and for an injunction. The circuit court dismissed — not on the merits, but because the college had not first taken its argument to the board of review under section 16-70 of the Property Tax Code. Failure to exhaust administrative remedies.
What the appellate court held
The Fourth District reversed and remanded. The reasoning runs in three steps, and each one is worth understanding on its own.
1. A charter exemption is not a use-based exemption
The court read the charter as extending the exemption to the college's property with no qualification about how the property is used. That is dramatically different from the modern statutory exemptions, which are conditioned on use — school property is exempt only if "not sold or leased or otherwise used with a view to profit," and charitable property only if "actually and exclusively used for charitable or beneficent purposes."
Notably, the court got there without accepting the college's main textual argument. The college leaned on the phrase "for any and all purposes whatever," reading it to mean the exemption applies regardless of the owner's purpose. The court disagreed. Applying the last-antecedent doctrine, it held that phrase modifies "taxation" — meaning the exemption covers any property tax levied for any purpose, whether general revenue, schools, a sanitary district, or a library. It refers to the purpose of the tax, not the use of the land. The college won anyway, on the plain, unqualified language of the grant itself.
That distinction is a good lesson in advocacy: the court rejected the argument the party led with and ruled for it on a cleaner ground.
2. The Property Tax Code's machinery does not reach a charter exemption
The county pointed to the Code sections requiring an owner to report a change in use and to file an annual affidavit, arguing that ending classes was a reportable change that turned the parcels into omitted property. The court read those sections in context. Both are directed at exemptions that arise under the Code — one expressly references "a use exempt from taxation under this Code," the other property "granted an exemption by the Department."
The college's exemption arose under neither. As the court put it, the defendants were asking the college to exhaust an administrative process that could not validate its exemption, because that process does not address charter-based exemptions at all. The Tax Code does not even use the word "charter."
3. An assessor has no authority to assess exempt property
This is the part with the broadest reach. Public officials have only the taxing power the legislature delegates to them. The Property Tax Code directs local assessment officers to assess "all other property not exempted from taxation." A local assessor has no independent authority to unwind an exemption that has already been recognized.
Because the assessor lacked authority to assess the property, the assessment was improper — and, the court said, the properties remain exempt. Exhaustion was excused under the settled exception for an agency that lacks jurisdiction to grant the relief sought.
The most interesting paragraph in the opinion
The circuit court had reasoned that a charter is a contract, and that by ending its teaching operations the college had failed its side of the bargain.
The appellate court took that argument seriously enough to follow it to its conclusion — and that is where it broke down. If the college has truly abandoned the purpose for which it was chartered, the court observed, the consequence would not stop at its tax exemption. It would raise a question about whether the corporation may continue to exist under that charter at all. And Illinois law already assigns that question to someone: the Attorney General, who may seek judicial dissolution of a not-for-profit corporation that has exceeded its authority.
Neither a county assessor nor the Department of Revenue has been given that power. A question that weighty, the court said, cannot be resolved by a local assessor or through an administrative process built for use-based exemptions.
What this means if you own exempt property in Illinois
A few practical points come out of this.
- Find out which kind of exemption you actually have. Most Illinois exempt owners hold a use-based exemption granted by the Department of Revenue under the Property Tax Code. A small number of pre-1870 institutions — colleges, seminaries, benevolent societies, cemetery associations — hold something categorically different. The analysis, and your leverage, are not the same.
- An assessor's letter is not a determination. An assessor's belief that your exemption has lapsed does not, by itself, end it. That does not mean you should ignore the letter — but it does mean the procedural posture may be more favorable than it first appears.
- Exhaustion is the fight worth having early. The county nearly won this case without ever reaching the merits. If the administrative body genuinely lacks power to decide your issue, say so at the outset and be ready to explain why.
- Winding down is not the same as abandoning. The college has been in an orderly, documented wind-down for years. The record of that activity mattered.
- A charter exemption belongs to the chartered entity. It attaches to property belonging to that corporate body. It is not a feature of the dirt, and a buyer should not assume it comes along with a purchase.
One caution about how this has been reported
This decision has been described as a ruling that the closed college is still tax exempt. That is a fair shorthand for the court's statement that the properties remain exempt — but the disposition was a reversal and remand. The case went back to the circuit court for further proceedings on the merits of the college's complaint. Anyone relying on this decision should read it as what it is: a strong appellate holding on the assessor's authority and on exhaustion, with the underlying case still moving.
If you are dealing with an exemption dispute
Exemption fights turn on details — the origin of the exemption, the precise language of the grant, what the record shows about use and wind-down, and whether the body demanding a hearing has power to give you one. If a county has moved to tax property you believe is exempt, or if you are buying or selling property that has been off the tax rolls, those questions are worth answering before a bill arrives.
Learn more about our property tax appeal work, or how exempt and formerly exempt property fits into commercial real estate transactions.