SPRINGFIELD — A federal judge has thrown out a lawsuit filed by a group representing gas station owners that fought a requirement for businesses to display signs advertising a freeze on the state’s gas tax as part of Democratic Gov. J.B. Pritzker’s $1.8 billion tax relief plan.
The Illinois Fuel & Retail Association argued in its lawsuit that the provision would force gas stations to post political signage and represented an unconstitutional violation of free speech.
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But in a 20-page ruling issued Thursday, U.S. District Judge Sue E. Myerscough determined the signage merely contains “a purely factual statement” about the new law.
“The signage does not contain controversial statements,” she wrote. “Plaintiffs cite no case law or authority, binding or otherwise, to support their contention that the signage is political.”
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Myerscough also wrote that the information contained in the signage “furthers the Defendants’ stated goal of ‘ensuring that customers actually are aware of and obtain the benefit of the General Assembly’s suspension of the inflation adjustment to the gas tax.’”
The requirement, which passed through the Illinois General Assembly in its truncated spring session, calls for gas stations to post a 4-by-8-inch sign informing drivers of a gas tax freeze for the second half of 2022, beginning July 1.
The lawsuit was originally filed last month in Sangamon County court before it was transferred to federal court in early June.
Josh Sharp, CEO of the fuel and retail organization, said Myerscough’s ruling, which came ahead of a scheduled Friday hearing that was then canceled, defied “common sense and the Constitution.”
“I think it was absolutely rushed by the judge,” Sharp said. “This type of speech should be relegated to campaign commercials and direct mail.”
The group, which Sharp said is considering an appeal, has argued the signage forces gas stations to “speak on behalf of the Illinois government” or get fined $500 for each day they fail to post the notice.
As evidence the sticker requirement is “undoubtedly political,” the lawsuit cited a Pritzker campaign ad that boasts “J.B. froze the gas tax,” and also cited comments Democratic state Rep. Mike Zalewski of Riverside made during a committee hearing on the issue. Zalewski, who sponsored the measure, said that as drivers fill up their tanks later this year, “their gaze will fix upon the pump and maybe they’ll read about the good things we did.”
The six-month pause in the state’s annual inflation-based gas tax increase is part of a broader effort by Pritzker and the Democrats who control the legislature to show voters that they’re taking action against rising consumer prices. Republicans have dismissed the package, which also includes a one-year suspension of the grocery tax, property tax rebates of up to $300, and direct payments to many taxpayers, as election-year gimmickry.
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The state gas tax, currently 39.2 cents per gallon, was set to increase by 2.4 cents on July 1, according to the state Department of Revenue. But with Pritzker’s signature on the tax relief plan, that bump will be pushed off until Jan. 1, with the exact amount of the increase to be determined by where inflation stands at the end of September. Drivers will be hit with another increase on July 1, 2023.
The gas station owners also argued they’re being treated differently than other businesses whose customers will benefit from the tax breaks. Supermarkets, for instance, will be required, “to the extent feasible,” to print a notice on their receipts that the 1% sales tax on groceries has been waived for one year. If it can’t be printed on the receipt, “then the retailer shall post the statement on a sign that is clearly visible to customers.”
But grocery stores, unlike gas stations, won’t face a fine if they fail to comply, a discrepancy that is “a clear violation of Plaintiffs’ Equal Protection rights guaranteed by the United States and State of Illinois Constitutions,” the fuel and retail group also alleged in its lawsuit.
Myerscough, however, accepted the argument from the defendants that the complaint was “legally insufficient” because the mandated signage was part of a law for a legitimate government purpose that “neither infringes on a fundamental right nor discriminates on a basis warranting heightened scrutiny.”
The Republican minority in the legislature chided Democrats for passing the measure, prompting Democrats to call their GOP colleagues hypocrites because GOP lawmakers pushed a similar election-year proposal two decades ago.
