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Legal Authority of State of Illinois County or Multi-County Health Departments to Lease Property

posted on Thu, Dec 8 2016 11:05 am by The Network for Public Health Law

A requestor from Illinois recently contacted the Network asking if a county or multi-county health department in that state has the legal authority to lease a portion of its building to another entity.

Under Illinois law, a county health department has only those powers specifically granted to it by law or necessarily implied by an express grant of authority. See Attorney General Opinion No. S-1416 (1979). There are several grants of authority relevant to the requestor’s issue.

1. First, under 55 ILCS 5/5-25016, a county or multi-county board of health is authorized to “lease or to acquire by purchase, construction, lease-purchase agreement or otherwise and take title in its name and to borrow money, issue debt instruments, mortgages, purchase money mortgages and other security instruments, maintain, repair, remodel or improve such real estate as may be reasonably necessary for the housing and proper functioning of such health department.” Since the statute does not expressly grant authority to the board of health to lease property already owned by the county, authority to lease property is likely not available under this section. See page 5 of Attorney General Opinion No. 016 (1996) (see part 2 below for further discussion of this opinion). 

In Attorney General Opinion No. S-1416 (1979) (cited above), the Attorney General (AG) adopted a similarly narrow interpretation of the authority granted under this statute. There, the AG was asked whether a county board of health may mortgage property to which it already holds title. The AG found that the board of health did not have such authority “because the only mortgage which a board of health is authorized to enter into is a purchase money mortgage, and because the mortgage which you have described is not in the nature of a purchase money mortgage.”

2. Second, under 55 ILCS 5/5-25013(B), a county or multi-county board of health is authorized to:

“5. Enter into contracts with the State, municipalities, other political subdivisions and non-official agencies for the purchase, sale or exchange of health services.

8. Enter into contracts with municipal health departments, county health departments, other boards of health, private or public hospitals, and not for profit entities to provide public health services outside of a board of health’s own jurisdiction in order to protect the public health in an effective manner.”

In Attorney General Opinion No. 016 (1996) (cited above), the AG considered whether a county board of health may authorize the transfer of assets of the county health department to a nonprofit in exchange for the nonprofit providing mental health services to residents of the county. The AG found that such an exchange was authorized by 55 ILCS 5/5-25013(B)(5) and concluded that the board of health was authorized to pay for such services, whether from the county health fund or other sources such as the rental or sale value of physical assets. However, the AG noted that since the board of health “is not expressly authorized to dispose of county owned property,” “those aspects of such a contract relating to the transfer of county property, either in exchange for services or on some other basis, should have [C]ounty [B]oard approval” because the County Board does have express authority under 55 ILCS 5/5-1005(2) to sell or lease county-owned real or personal property. Note that a County Board is authorized to exercise general corporate powers of a county (see 55 ILCS 5/5-1004 and 5-1005), while a county board of health is appointed by the County Board and holds more limited powers specifically relevant to protecting and promoting the public’s health (see 55 ILCS 5/5-25012 and 25013).

The same constraint likely applies to board of health contracts executed pursuant to 55 ILCS 5/5-25013(B)(8), in that aspects of a contract relating to a lease of property should have County Board approval.

3. Third, as noted above, under 55 ILCS 5/5-1005(2), a County Board—as opposed to a county board of health—is authorized to “sell and convey or lease any real or personal estate owned by the county.” This authority is limited by the Illinois Constitution, Article VIII, Section 1(a), which states that “[p]ublic funds, property or credit shall be used only for public purposes.” Thus, public property may be leased by the county only for public purposes. See Attorney General Opinion No. S-1046 (1976) (analyzing several types of proposed tenants and leases to determine whether they qualified as a public purpose). A County Board may delegate its authority to contract on behalf of the county to a county or multi-county board of health by ordinance or resolution. Attorney General Opinion No. S-602 (1973), pages 8-9.

Thus, Illinois law provides that a county or multi-county board of health may lease county property (1) with the approval of the County Board or (2) if authorized by ordinance or resolution.

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