In a legal battle which has been fought since 1998, Keystone Montessori School has bested River Forest’s village government and been granted a nonprofit property tax exemption on its North Avenue facility by a state government agency.
Most notably after years of appeals in multiple court venues and in front of state agencies, River Forest accepts the outcome and will not make any further efforts to collect property taxes from the school, according to Village Administrator Matt Walsh.
“The village is not planning to appeal the decision,” Walsh said. “We have accepted the recommendation from the ALJ. The village does not want to keep repeating the same battles and the decision was pretty clear. I don’t think we were confident that we would be able to overturn that decision.”
More than four years after Keystone took its case for a real estate tax exemption before the Illinois Department of Revenue, that regulatory body found the school is entitled to receive a 100% real estate tax exemption.
On May 12, 2023, the determination made by the department also reinforced judgments from the Cook County Circuit Court as well as the Illinois Appellate Court, finding Keystone is entitled to the exemption at its current location, 7415 W. North Ave.
Katie Shea, Keystone head of school, told Wednesday Journal she was relieved about the determination and felt validated.
“It wasn’t just for Keystone, it was for Montessori and all private schools in Illinois,” Shea said. “It is nice going forward. We have a very good relationship with the other schools in the area and it is nice to just be counted among them officially now and be validated.”
According to Richard Baker of Mauck & Baker, Keystone’s law firm, after both the Cook County Circuit Court and the Appellate Court ruled against the village in regard to its original agreement with Keystone, the village regrouped and argued that Keystone Montessori School was primarily a “pre-school” and therefore should not be exempt under state law.
“Specifically, River Forest argued that the mandated school age in Illinois for kindergarten is 5 years old. Since Montessori Primary Classes include 3 and 4 year olds, River Forest argued that a significant portion of the school is really a pre-school and therefore it was not entitled to an exemption,” read the press release.
The Department of Revenue found Keystone was recognized by the Illinois Board of Education as a non-public elementary school using the Montessori method and qualified as a school.
Currently, Keystone has 70 children enrolled from infancy to eighth grade.
“This was very unusual, what River Forest did. This is not the norm,” Baker said, adding the Department of Revenue has always viewed Keystone as a school. “They used quite novel theories in their attempt to continue the taxation of the property. … if the Department of Revenue had gone along with what River Forest was trying to do, it would threaten Montessori schools and other schools that have preschools.”
Village President Cathy Adduci did not respond to requests for comment and asked that questions be addressed to Village Administrator Matt Walsh.
Walsh told Wednesday Journal the village would not be appealing the May 12 decision.
The school began having issues with the village following its move in 1998 into the former site of Margie’s Bridal Salon on North Avenue. The large commercial building had been vacant for five years. In hopes of developing the space to fit their curriculum needs, Shea said Keystone began renovations and opened its school year on Sept. 8, 1998. According to information left by late-founder Victoria Shea, in October 1998, Keystone met with the Village of River Forest which presented them with a tax agreement in which Keystone would promise to not claim their property tax exemption as a school.
Keystone had been allowed to move into a building not zoned for a school and while the village rezoned the area to accommodate a school, the village claimed Keystone should continue to generate property taxes and would not approve its final occupancy permit, despite classes already being in progress. Keystone agreed to the arrangement to not lose the building and the money already invested in the remodeling.
“They did it with the understanding that they would revisit the subject and apply for tax relief,” said Katie Shea. “They did that several times.”
Katie Shea is the daughter of Victoria Shea, who passed away September 2022.
According to Keystone, it approached the village asking for tax relief in 2002, 2003, 2004, 2007, 2009, and 2011. All requests were denied.
In March 2018, Keystone filed a lawsuit against the village government in Cook County Circuit Court claiming the original agreement regarding the property taxes was unconstitutional and illegal. In December 2018, the Illinois Department of Revenue granted Keystone a property tax exemption but the ruling was appealed by the village.
Hoping to now move forward, Walsh said the village wants an amicable relationship with Keystone.
“Both sides had their opinions and a decision was made. It is always the village’s intent to be amicable with any business or institution in town,” Walsh said. “We are past this point. We would like to move forward with that amicable relationship.”
Despite the final ruling, Keystone is not aware if it will be entitled to repayment of taxes it has paid to the village over many years.
“Right now, we are just happy we don’t have to worry about the looming threat of the financial burden the taxes have brought to us,” Shea said.
According to previous reports, in the original lawsuit Keystone asked for reimbursement for attorney fees as well as for the property taxes they claimed they should have never paid. According to Keystone, they have paid the Village $1.1 million in property taxes since they acquired the space in 1998.
The Village did not respond to inquiries regarding the amount of property taxes paid by Keystone, nor the financial cost in attorney fees the Village has paid to appeal previous decisions.
Mauck said while there are possibilities to go back to request reimbursement, that is a decision that has not been made yet, but the financial responsibility of reimbursement would not fall solely on the village as property taxes are shared among multiple local taxing bodies.
Walsh said there was no information at the moment on whether or not Keystone would receive any reimbursement.
