A Chicago tour
boat company is asking a Cook County circuit judge to rule a Cook County
administrative law judge was right to say the county can’t apply an amusement
tax on the company’s Chicago River and Lake Michigan boat tours, but to find the
administrative law judge did so for the wrong reason – a move which could also
spell taxing trouble for the operators of Chicago’s walking tours.
On Aug. 23
in Cook County Circuit Court, Mercury Skyline Yachts Charters and Mercury
Sightseeing Boats filed, as a “protective measure,” a request for an
administrative review, which asked that a judge review a ruling by a Cook
County administrative law judge, regarding Mercury’s protest against an
amusement tax the county sought to impose on Mercury.
operates seven boats that are used for cruises on Lake Michigan and architectural
tours along the Chicago River. On the architectural tours, Chicago Architecture
Foundation guides provide commentary. On four of the six non-architectural
sightseeing cruises, Mercury crew members provide commentary; there is no
commentary for the other two.
County Department of Revenue tried to impose an amusement tax on Mercury in
September 2014, but Mercury protested the tax violated the equal protection
guarantees of the Illinois and United States’ constitutions, because the county
did not tax walking tours of city landmarks. Mercury also claimed their boat
tours should be considered “live entertainment” and thus be exempt from the tax.
a hearing before a county administrative law judge in February 2016. According
to Mercury’s court filing, the county administrative law judge ruled July 19
the tax should apply to Mercury’s architectural tours and to four of the
sightseeing cruises that come with commentary; it did not apply to the two
cruises without commentary. Nevertheless, the judge said Mercury was totally
exempt under the U.S. Maritime Transportation Safety Act of 2002, which
prohibits – except in limited circumstances – non-federal agencies from taxing
vessels that travel on navigable waters under federal authority.
administrative law judge did not address Mercury’s constitutional argument.
apparently glad it did not have to pay the tax, but was unhappy with the
finding its operations were considered “amusement,” and the possibility that, if
not for the overriding federal law, the company would have needed to fork over
other legal ground on which to stand, Mercury visited circuit court last week, asking
a circuit judge to affirm the administrative law judge’s decision finding the
tours and cruises are not taxable, but to reject the grounds the administrative
judge cited in arriving at that decision.
Mercury wants a review of its constitutional argument.
The county Department
of Revenue has also asked a circuit court judge to overturn the administrative
law judge’s ruling that the Maritime Act bars the county from assessing the
amusement tax. Further, the department is trying to head off Mercury’s request
for review in circuit court by contending Mercury should never have had a
county administrative hearing in the first place, because Mercury missed the
filing deadline for the hearing.
countered it did file in time and the administrative law judge agreed. Mercury
is arguing the department has no right to now maintain Mercury was tardy for
the administrative hearing, given the department didn’t raise the issue at the
documents do not indicate how much potential tax money is at stake in the legal
represented by the Chicago firm of Jenner & Block. A status hearing is set
for Oct. 18 before Circuit Judge Ann Collins-Dole.