SB2093ham002 96TH GENERAL ASSEMBLY

Rep. Thomas Holbrook

Filed: 1/11/2010

09600SB2093ham002 LRB096 11467 RLJ 32088 a

AMENDMENT TO SENATE BILL 2093

AMENDMENT NO. ______. Amend Senate Bill 2093, AS AMENDED, by replacing everything after the enacting clause with the following:

"Section 1. Short title. This Act may be cited as the STAR Bonds Financing Act.

Section 5. Purpose. It is hereby found and declared that the purpose of this Act is to promote, stimulate, and develop the general and economic welfare of the State of Illinois and its communities and to assist in the development and redevelopment of major tourism, entertainment, retail, and related destination projects within eligible areas of the State, thereby creating new jobs, stimulating significant capital investment, and promoting the general welfare of the citizens of this State, by authorizing municipalities and counties to issue sales tax and revenue (STAR) bonds for the financing of STAR bond projects as defined in Section 10, and to otherwise exercise the powers and authorities granted to municipalities. It is further found and declared to be the policy of the State, in the interest of promoting the health, safety, morals, and general welfare of all the people of the State, to provide incentives to create new job opportunities and to promote major tourism, entertainment, retail, and related destination projects within the State. It is further found and declared:

(a) that as a result of the costs of land assemblage, financing, infrastructure, and other project costs, the private sector, without the assistance contemplated in this Act, is unable to develop major tourism, entertainment, retail, and related destination projects in the State;

(b) that the type of projects for which this Act is intended must be of a certain size, scope, and acreage and have direct access to major highways, and must be developed in a cohesive and comprehensive manner;

(c) that the eligible tracts of land, significant portions of which are vacant and located in the 100-year flood plain, present unique development obstacles and are more likely to remain underutilized and undeveloped, or developed in a piecemeal manner resulting in inefficient and poorly planned developments that do not maximize job creation, job retention, tourism, and tax revenue generation within the State;

(d) that there are multiple eligible areas in the State that could benefit from this Act;

(e) that municipalities of the State that already have an enterprise zone in place have a sufficient tool to encourage development and to preserve and enhance their local tax bases and job opportunities and otherwise achieve the purposes set forth in this Act;

(f) that investment in major tourism, entertainment, retail, and related destination projects within the State would stimulate economic activity in the State, including the creation and maintenance of jobs, the creation of new and lasting infrastructure and other improvements, and the attraction and retention of interstate tourists and entertainment events that generate significant economic activity;

(g) that the continual encouragement, development, growth, and expansion of major tourism, entertainment, retail, and related destination projects within the State requires a cooperative and continuous partnership between government and the public sector;

(h) that the State has a responsibility to help create a favorable climate for new and improved job opportunities for its citizens and to increase the tax base of the State and its political subdivisions by encouraging development by the private sector of major tourism, entertainment, retail, and related destination projects within the State;

(i) that the stagnation of local tax bases and the loss of job opportunities within the State has persisted despite efforts of State and local authorities and private organizations to create major tourism, entertainment, retail, and related destination projects within the State;

(j) that the stagnation of local tax bases and the persistent loss of job opportunities in the State may continue and worsen if the State and its political subdivisions are not able to provide additional incentives to developers of major tourism, entertainment, retail, and related destination projects;

(k) that the provision of additional incentives by the State and its political subdivisions will relieve conditions of unemployment, maintain existing levels of employment, create new job opportunities, retain jobs within the State, increase tourism and commerce within the State, and increase the tax base of the State and its political subdivisions;

(l) that the powers conferred by this Act promote and protect the health, safety, morals, and welfare of the State, and are for a public purpose and public use for which public money and resources may be expended; and

(m) that the necessity in the public interest for the provisions of this Act is hereby declared as a matter of legislative determination.

Section 10. Definitions. As used in this Act, the following words and phrases shall have the following meanings unless a different meaning clearly appears from the context:

"Base year" means the calendar year immediately prior to the calendar year in which the STAR bond district is established.

"Commence work" means the manifest commencement of actual operations on the development site, such as, erecting a building, general on-site and off-site grading and utility installations, commencing design and construction documentation, ordering lead-time materials, excavating the ground to lay a foundation or a basement, or work of like description which a reasonable person would recognize as being done with the intention and purpose to continue work until the project is completed.

"County" means the county in which a proposed STAR bond district is located.

"De minimus" means an amount less than 15% of the land area within a STAR bond district.

"Department of Revenue" means the Department of Revenue of the State of Illinois.

"Destination user" means an owner, operator, licensee, co-developer, subdeveloper, or tenant (i) that operates a business within a STAR bond district that is a retail store having at least 150,000 square feet of sales floor area; (ii) that at the time of opening does not have another Illinois location within a 70 mile radius; (iii) that has an annual average of not less than 30% of customers who travel from at least 75 miles away or from out-of-state, as demonstrated by data from a comparable existing store or stores, or, if there is no comparable existing store, as demonstrated by an economic analysis that shows that the proposed retailer will have an annual average of not less than 30% of customers who travel from at least 75 miles away or from out-of-state; and (iv) that makes an initial capital investment, including project costs and other direct costs, of not less than $30,000,000 for such retail store.

"Developer" means any individual, corporation, trust, estate, partnership, limited liability partnership, limited liability company, or other entity. The term does not include a not-for-profit entity, political subdivision, or other agency or instrumentality of the State.

"Director" means the Director of Revenue, who shall consult with the Director of Commerce and Economic Opportunity in any approvals or decisions required by the Director under this Act.

"Economic impact study" means a study conducted by an independent economist to project the financial benefit of the proposed STAR bond project to the local, regional, and State economies, consider the proposed adverse impacts on similar projects and businesses, as well as municipalities within the projected market area, and draw conclusions about the net effect of the proposed STAR bond project on the local, regional, and State economies. A copy of the economic impact study shall be provided to the Director for review.

"Eligible area" means any improved or vacant area that is contiguous and is not, in the aggregate, less than 600 acres which must include only parcels of real property directly and substantially benefited by the proposed STAR bond district plan, which is located adjacent to the intersection of at least 2 highways, one of which is an interstate highway, which area must be comprised of land which is at least 90% vacant, and at least 30% of which is located in the 100-year flood plain. The area may be bisected by streets, highways, roads, alleys, railways, bike paths, streams, rivers, and other waterways and still be deemed contiguous. In addition, in order to constitute an eligible area one of the following requirements must be satisfied and all of which are subject to the review and approval of the Director as provided in subsection (d) of Section 15:

(a) the governing body of the political subdivision shall have determined that the area meets the requirements of a "blighted area" as defined under the Tax Increment Allocation Redevelopment Act; or

(b) the governing body of the political subdivision shall have determined that the area is a blighted area as determined under the provisions of Section 11-74.3-5 of the Illinois Municipal Code; or

(c) the governing body of the political subdivision shall make the following findings:

(i) that the vacant portions of the area have remained vacant for at least one year, or that any building located on a vacant portion of the property was demolished within the last year and that the building would have qualified under item (ii) of this subsection;

(ii) if portions of the area are currently developed, that the use, condition, and character of the buildings on the property are not consistent with the purposes set forth in Section 5;

(iii) that the STAR bond district is expected to create or retain job opportunities within the political subdivision;

(iv) that the STAR bond district will serve to further the development of adjacent areas;

(v) that without the availability of STAR bonds, the projects described in the STAR bond district plan would not be possible;

(vi) that the master developer meets high standards of creditworthiness and financial strength as demonstrated by one or more of the following: (i) corporate debenture ratings of BBB or higher by Standard & Poor's Corporation or Baa or higher by Moody's Investors Service, Inc.; (ii) a letter from a financial institution with assets of $10,000,000 or more attesting to the financial strength of the master developer; or (iii) specific evidence of equity financing for not less than 10% of the estimated total STAR bond project costs;

(vii) that the STAR bond district will strengthen the commercial sector of the political subdivision;

(viii) that the STAR bond district will enhance the tax base of the political subdivision; and

(ix) that the formation of a STAR bond district is in the best interest of the political subdivision.

"Entertainment user" means an owner, operator, licensee, co-developer, subdeveloper, or tenant that operates a business within a STAR bond district that has a primary use of providing a venue for entertainment attractions, rides, or other activities oriented toward the entertainment and amusement of its patrons, occupies at least 50 acres of land in the STAR bond district, and makes an initial capital investment, including project costs and other direct and indirect costs, of not less than $100,000,000 for that venue.

"Feasibility study" means a feasibility study as defined in subsection (b) of Section 20.

"Infrastructure" means the public improvements and private improvements that serve the public purposes set forth in Section 5 of this Act and that benefit the STAR bond district or any STAR bond projects, including, but not limited to, streets, drives and driveways, traffic and directional signs and signals, parking lots and parking facilities, interchanges, highways, sidewalks, bridges, underpasses and overpasses, bike and walking trails, sanitary storm sewers and lift stations, drainage conduits, channels, levees, canals, storm water detention and retention facilities, utilities and utility connections, water mains and extensions, and street and parking lot lighting and connections.

"Local sales taxes" means any locally-imposed taxes received by a municipality, county, or other local governmental entity arising from sales by retailers and servicemen within a STAR bond district, including business district sales taxes and STAR bond occupation taxes, and that portion of the net revenue realized under the Retailers' Occupation Tax Act, the Use Tax Act, the Service Use Tax Act, and the Service Occupation Tax Act from transactions at places of business located within a STAR bond district that is deposited into the Local Government Tax Fund and the County and Mass Transit District Fund. For the purpose of this Act, "local sales taxes" does not include (i) any taxes authorized pursuant to the Local Mass Transit District Act, the Metro-East Park and Recreation District Act, or the Flood Prevention District Act for so long as the applicable taxing district does not impose a tax on real property or (ii) any local sales taxes that are, at the time of formation of a STAR bond district, already subject to tax increment financing under the Tax Increment Allocation Redevelopment Act.

"Local sales tax increment" means, with respect to local sales taxes administered by the Illinois Department of Revenue, (i) that portion of the local sales tax paid by destination users and entertainment users that is in excess of the local sales tax paid by destination users and entertainment users for the same month in the base year, as determined by the Illinois Department of Revenue and (ii) that portion of the local sales tax paid by taxpayers that are not destination users or entertainment users that is in excess of the local sales tax paid by taxpayers that are not destination users or entertainment users for the same month in the base year, as determined by the Illinois Department of Revenue. "Local sales tax increment" means, with respect to local sales taxes administered by a municipality, county, or other unit of local government, that portion of the local sales tax that is in excess of the local sales tax for the same month in the base year, as determined by the respective municipality, county, or other unit of local government. The Illinois Department of Revenue shall allocate the local sales tax increment only if the local sales tax is administered by the Department.

"Market study" means a study to determine the ability of the proposed STAR bond project to gain market share locally and regionally and to remain profitable past the term of repayment of STAR bonds.

"Master developer" means a developer cooperating with a political subdivision to plan, develop, and implement a STAR bond project plan for a STAR bond district. Subject to the limitations of Section 25, the master developer may work with and transfer certain development rights to other developers for the purpose of implementing STAR bond project plans and achieving the purposes of this Act. A master developer for a STAR bond district shall be appointed by a political subdivision in the resolution establishing the STAR bond district, and the master developer must, at the time of appointment, own or have control of, through purchase agreements, option contracts, or other means, not less than 50% of the acreage within the STAR bond district and the master developer or its affiliate must have ownership or control on May 26, 2009.

"Master development agreement" means an agreement between the master developer and the political subdivision to govern a STAR bond district and any STAR bond projects.

"Municipality" means the city, village, or incorporated town in which a proposed STAR bond district is located.

"Pledged STAR revenues" means those sales tax and revenues and other sources of funds pledged to pay debt service on STAR bonds or to pay project costs pursuant to Section 30. Notwithstanding any provision to the contrary, the following revenues shall not constitute pledged STAR revenues or be available to pay principal and interest on STAR bonds: any State sales tax increment or local sales tax increment from a retail entity initiating operations in a STAR bond district while terminating operations at another Illinois location within 25 miles of the STAR bond district. For purposes of this paragraph, "terminating operations" means a closing of a retail operation that is directly related to the opening of the same operation or like retail entity owned or operated by more than 50% of the original ownership in a STAR bond district within one year before or after initiating operations in the STAR bond district, but it does not mean closing an operation for reasons beyond the control of the retail entity, as documented by the retail entity, subject to a reasonable finding by the municipality that the current location contained inadequate space, had become economically obsolete, or was no longer a viable location for the retailer or serviceman.

"Political subdivision" means a municipality or county which undertakes to establish a STAR bond district pursuant to the provisions of this Act.

"Project costs" means and includes the sum total of all costs incurred or estimated to be incurred on or following the date of establishment of a STAR bond district that are reasonable or necessary to implement a STAR bond district plan or any STAR bond project plans, or both, including costs incurred for public improvements and private improvements that serve the public purposes set forth in Section 5 of this Act. Such costs include without limitation the following:

(a) costs of studies, surveys, development of plans and specifications, formation, implementation, and administration of a STAR bond district, STAR bond district plan, any STAR bond projects, or any STAR bond project plans, including, but not limited to, staff and professional service costs for architectural, engineering, legal, financial, planning, or other services, provided however that no charges for professional services may be based on a percentage of the tax increment collected and no contracts for professional services, excluding architectural and engineering services, may be entered into if the terms of the contract extend beyond a period of 3 years;

(b) property assembly costs, including, but not limited to, acquisition of land and other real property or rights or interests therein, located within the boundaries of a STAR bond district, demolition of buildings, site preparation, site improvements that serve as an engineered barrier addressing ground level or below ground environmental contamination, including, but not limited to, parking lots and other concrete or asphalt barriers, the clearing and grading of land, and importing additional soil and fill materials, or removal of soil and fill materials from the site;

(c) subject to paragraph (d), costs of buildings and other vertical improvements that are located within the boundaries of a STAR bond district and owned by a political subdivision or other public entity, including without limitation police and fire stations, educational facilities, and public restrooms and rest areas;

(c-5) costs of buildings; rides and attractions, which include carousels, slides, roller coasters, displays, models, towers, works of art, and similar theme and amusement park improvements; and other vertical improvements that are located within the boundaries of a STAR bond district and owned by an entertainment user; except that only one entertainment user in a STAR bond district is eligible to include the cost of those vertical improvements as project costs;

(d) costs of the design and construction of infrastructure and public works located within the boundaries of a STAR bond district that are reasonable or necessary to implement a STAR bond district plan or any STAR bond project plans, or both, except that project costs shall not include the cost of constructing a new municipal public building principally used to provide offices, storage space, or conference facilities or vehicle storage, maintenance, or repair for administrative, public safety, or public works personnel and that is not intended to replace an existing public building unless the political subdivision makes a reasonable determination in a STAR bond district plan or any STAR bond project plans, supported by information that provides the basis for that determination, that the new municipal building is required to meet an increase in the need for public safety purposes anticipated to result from the implementation of the STAR bond district plan or any STAR bond project plans;

(e) costs of the design and construction of the following improvements located outside the boundaries of a STAR bond district, provided that the costs are essential to further the purpose and development of a STAR bond district plan and either (i) part of and connected to sewer, water, or utility service lines that physically connect to the STAR bond district or (ii) significant improvements for adjacent offsite highways, streets, roadways, and interchanges that are approved by the Illinois Department of Transportation. No other cost of infrastructure and public works improvements located outside the boundaries of a STAR bond district may be deemed project costs;

(f) costs of job training and retraining projects, including the cost of "welfare to work" programs implemented by businesses located within a STAR bond district;

(g) financing costs, including, but not limited to, all necessary and incidental expenses related to the issuance of obligations and which may include payment of interest on any obligations issued hereunder including interest accruing during the estimated period of construction of any improvements in a STAR bond district or any STAR bond projects for which such obligations are issued and for not exceeding 36 months thereafter and including reasonable reserves related thereto;

(h) to the extent the political subdivision by written agreement accepts and approves the same, all or a portion of a taxing district's capital costs resulting from a STAR bond district or STAR bond projects necessarily incurred or to be incurred within a taxing district in furtherance of the objectives of a STAR bond district plan or STAR bond project plans;

(i) interest cost incurred by a developer for project costs related to the acquisition, formation, implementation, development, construction, and administration of a STAR bond district, STAR bond district plan, STAR bond projects, or any STAR bond project plans provided that:

(i) payment of such costs in any one year may not exceed 30% of the annual interest costs incurred by the developer with regard to the STAR bond district or any STAR bond projects during that year; and

(ii) the total of such interest payments paid pursuant to this Act may not exceed 30% of the total cost paid or incurred by the developer for a STAR bond district or STAR bond projects, plus project costs, excluding any property assembly costs incurred by a political subdivision pursuant to this Act;

(j) costs of common areas located within the boundaries of a STAR bond district;

(k) costs of landscaping and plantings, retaining walls and fences, man-made lakes and ponds, shelters, benches, lighting, and similar amenities located within the boundaries of a STAR bond district;

(l) costs of mounted building signs, site monument, and pylon signs located within the boundaries of a STAR bond district; or

(m) if included in the STAR bond district plan and approved in writing by the Director, salaries or a portion of salaries for local government employees to the extent the same are directly attributable to the work of such employees on the establishment and management of a STAR bond district or any STAR bond projects.

Except as specified in items (a) through (m), "project costs" shall not include:

(i) the cost of construction of buildings that are privately owned or owned by a municipality and leased to a developer or retail user for non-entertainment retail uses;

(ii) moving expenses for employees of the businesses locating within the STAR bond district;

(iii) property taxes for property located in the STAR bond district;

(iv) lobbying costs; and

(v) general overhead or administrative costs of the political subdivision that would still have been incurred by the political subdivision if the political subdivision had not established a STAR bond district.

"Project development agreement" means any one or more agreements, including any amendments thereto, between a master developer and any co-developer or subdeveloper in connection with a STAR bond project, which project development agreement may include the political subdivision as a party.

"Projected market area" means any area within the State in which a STAR bond district or STAR bond project is projected to have a significant fiscal or market impact as determined by the Director.

"Resolution" means a resolution, order, ordinance, or other appropriate form of legislative action of a political subdivision or other applicable public entity approved by a vote of a majority of a quorum at a meeting of the governing body of the political subdivision or applicable public entity.

"STAR bond" means a sales tax and revenue bond, note, or other obligation payable from pledged STAR revenues and issued by a political subdivision, the proceeds of which shall be used only to pay project costs as defined in this Act.

"STAR bond district" means the specific area declared to be an eligible area as determined by the political subdivision, and approved by the Director, in which the political subdivision may develop one or more STAR bond projects.

"STAR bond district plan" means the preliminary or conceptual plan that generally identifies the proposed STAR bond project areas and identifies in a general manner the buildings, facilities, and improvements to be constructed or improved in each STAR bond project area.

"STAR bond project" means a project within a STAR bond district which is approved pursuant to Section 20.

"STAR bond project area" means the geographic area within a STAR bond district in which there may be one or more STAR bond projects.

"STAR bond project plan" means the written plan adopted by a political subdivision for the development of a STAR bond project in a STAR bond district; the plan may include, but is not limited to, (i) project costs incurred prior to the date of the STAR bond project plan and estimated future STAR bond project costs, (ii) proposed sources of funds to pay those costs, (iii) the nature and estimated term of any obligations to be issued by the political subdivision to pay those costs, (iv) the most recent equalized assessed valuation of the STAR bond project area, (v) an estimate of the equalized assessed valuation of the STAR bond district or applicable project area after completion of a STAR bond project, (vi) a general description of the types of any known or proposed developers, users, or tenants of the STAR bond project or projects included in the plan, (vii) a general description of the type, structure, and character of the property or facilities to be developed or improved, (viii) a description of the general land uses to apply to the STAR bond project, and (ix) a general description or an estimate of the type, class, and number of employees to be employed in the operation of the STAR bond project.

"State sales tax" means all of the net revenue realized under the Retailers' Occupation Tax Act, the Use Tax Act, the Service Use Tax Act, and the Service Occupation Tax Act from transactions at places of business located within a STAR bond district, excluding that portion of the net revenue realized under the Retailers' Occupation Tax Act, the Use Tax Act, the Service Use Tax Act, and the Service Occupation Tax Act from transactions at places of business located within a STAR bond district that is deposited into the Local Government Tax Fund and the County and Mass Transit District Fund. For the purposes of this Act, "State sales tax" does not include any State sales taxes that are, at the time of formation of a STAR bond district, already subject to tax increment financing under the Tax Increment Allocation Redevelopment Act.

"State sales tax increment" means that portion of the State sales tax that is in excess of the State sales tax for the same month in the base year, as determined by the Department of Revenue, from transactions at destination users and entertainment users located within a STAR bond district, which destination users and entertainment users shall be designated by the master developer and approved by the political subdivision and the Director in conjunction with the applicable STAR bond project approval.

"Substantial change" means a change wherein the proposed STAR bond project plan differs substantially in size, scope, or use from the approved STAR bond district plan or STAR bond project plan.

"Taxpayer" means an individual, partnership, corporation, limited liability company, trust, estate, or other entity that is subject to the Illinois Income Tax Act.

"Total development costs" means the aggregate public and private investment in a STAR bond district, including project costs and other direct and indirect costs related to the development of the STAR bond district.

"Vacant" means that portion of the land in a proposed STAR bond district that is not occupied by a building, facility, or other vertical improvement.

Section 15. Establishment of STAR bond district. The governing body of a municipality may establish a STAR bond district within an eligible area within the municipality or partially outside the boundaries of the municipality in an unincorporated area of the county. A STAR bond district which is partially outside the boundaries of the municipality must also be approved by the governing body of the county by the passage of a resolution. The governing body of a county may establish a STAR bond district in an eligible area in any unincorporated area of the county.

(a) When a political subdivision proposes to establish a STAR bond district, the political subdivision shall adopt a resolution stating that the political subdivision is considering the establishment of a STAR bond district. The resolution shall:

(1) give notice, in the same manner as set forth in item (2) of subsection (g) of Section 20, that a public hearing will be held to consider the establishment of a STAR bond district and fix the date, hour, and place of the public hearing, which shall be at a location that is within 20 miles of the STAR bond district, in a facility that can accommodate a large crowd, and in a facility that is accessible to persons with disabilities;

(2) describe the proposed general boundaries of the STAR bond district;

(3) describe the STAR bond district plan;

(4) require that a description and map of the proposed STAR bond district are available for inspection at a time and place designated;

(5) identify the master developer for the STAR bond district; and

(6) require that the governing body consider findings necessary for the establishment of a STAR bond district.

(b) Upon the conclusion of the public hearing the governing body of the political subdivision may consider a resolution to establish the STAR bond district.

(1) A resolution to establish a STAR bond district shall:

(A) make findings that the proposed STAR bond district is to be developed with one or more STAR bond projects;

(B) make findings that the STAR bond district is an eligible area;

(C) contain a STAR bond district plan that identifies in a general manner the buildings and facilities that are proposed to be constructed or improved in subsequent STAR bond projects and that includes plans for destination users and an entertainment user;

(D) contain the legal description of the STAR bond district;

(E) appoint the master developer for the STAR bond district; and

(F) establish the STAR bond district, contingent upon approval of the Director as set forth in subsection (d).

(2) If the resolution is not adopted by the political subdivision within 60 days from the conclusion of the public hearing, then the STAR bond district shall not be established.

(3) Upon adoption of a resolution establishing a STAR bond district, the political subdivision shall send a certified copy of such resolution to the Department of Revenue.

(c) Upon the establishment of a STAR bond district, the STAR bond district and any STAR bond projects shall be governed by a master development agreement between the political subdivision and the master developer. A STAR bond district that is partially outside the boundaries of a municipality shall only require one master development agreement; the agreement shall be between the municipality and the master developer. In no event shall there be more than one master development agreement governing the terms and conditions of a STAR bond district. The master development agreement shall require the master developer to ensure compliance with the following requirements to reduce the ecological impact of the STAR bond district development: (i) inclusion of pollution prevention, erosion, and sedimentation control plans during construction; (ii) protection of endangered species' habitat and wetlands mitigation; (iii) preservation of at least 20% of the STAR bond district as green space, including lawns, parks, landscaped areas, paths, lakes, ponds, and other water features; (iv) promotion of the use of renewable energy to the extent commercially feasible; (v) promotion of access to mass transit and bicycle transportation; (vi) implementation of recycling programs during construction and at completed STAR bond projects; (vii) preservation of water quality and promotion of water conservation through the use of techniques such as reusing storm water and landscaping with native and low-maintenance vegetation to reduce the need for irrigation and fertilization; (viii) inclusion of comprehensive lighting programs that reduce light pollution within the STAR bond district; and (ix) promotion of shared parking between different users to reduce the impact on project sites.

(d) Upon adoption of the resolution to establish a STAR bond district, the political subdivision shall submit the proposed STAR bond district to the Director for consideration. The Director may only approve a STAR bond district if the Director finds that: (i) the proposed STAR bond district is an eligible area, (ii) no portion of the proposed STAR bond district is located within a municipality that has an enterprise zone pursuant to the Illinois Enterprise Zone Act within its municipal boundaries, (iii) the STAR bond district plan includes a projected capital investment of at least $300,000,000, (iv) the STAR bond district plan is reasonably projected to produce at least $300,000,000 of annual gross sales revenues and 1,000 new jobs, (v) the STAR bond district plan includes potential destination users and a potential entertainment user, (vi) the creation of the STAR bond district and STAR bond district plan are in accordance with the purpose of this Act and the public interest, and (vii) the STAR bond district and STAR bond district plan meet any other requirement that the Director deems appropriate. If a proposed STAR bond district meets all of the foregoing criteria, the Director shall not unreasonably withhold its approval of the proposed STAR bond district. The Director may only approve one STAR bond district within any projected market area. However, the Director may approve additional STAR bond districts in a single projected market area provided that the Director finds that the additional STAR bond district will not thwart the purposes of this Act. The Director shall promptly send a copy of its written findings and approval or denial of a STAR bond district to the requesting political subdivision.

(e) Starting on the fifth anniversary of the first date of distribution of State sales tax revenues from the first STAR bond project in the STAR bond district and continuing each anniversary thereafter, the Director shall, in consultation with the political subdivision and the master developer, determine the total number of new jobs created within the STAR bond district, the total development cost to date, and the master developer's compliance with its obligations under any written agreements with the State. If, on the fifth anniversary of the first date of distribution of State sales tax revenues from the first STAR bond project in the STAR bond district, the Director determines that the total development cost to date is not equal to or greater than $300,000,000, or that the master developer is in breach of any written agreement with the State, then no new STAR bonds may be issued in the STAR bond district until the total development cost exceeds $300,000,000 or the breach of agreement is cured, or both. If, on the fifth anniversary of the first date of distribution of State sales tax revenues from the first STAR bond project in the STAR bond district, there are not at least 1,000 jobs existing in the STAR bond district, the State may require the master developer to pay the State a penalty of $1,500 per job under 1,000 each year until the earlier of (i) the twenty-third anniversary of the first date of distribution of State sales tax revenues from the first STAR bond project in the STAR bond district, (ii) the date that all STAR bonds issued in the STAR bond district have been paid off, or (iii) the date that at least 1,000 jobs have been created in the STAR bond district. Upon creation of 1,000 jobs in the STAR bond district, there shall not be an ongoing obligation to maintain those jobs after the fifth anniversary of the first date of distribution of State sales tax revenues from the first STAR bond project in the STAR bond district, and the master developer shall be relieved of any liability with respect to job creation under this subsection. Notwithstanding anything to the contrary in this subsection, the master developer shall not be liable for the penalties set forth under this subsection if the breach of agreement, failure to reach at least $300,000,000 in total development costs, or failure to create 1,000 jobs is due to delays caused by force majeure, as that term shall be defined in the master development agreement.

Section 20. Approval of STAR bond projects. The governing body of a political subdivision may establish one or more STAR bond projects in any STAR bond district. A STAR bond project which is partially outside the boundaries of a municipality must also be approved by the governing body of the county by resolution.

(a) After the establishment of a STAR bond district, the master developer may propose one or more STAR bond projects to a political subdivision and the master developer shall, in cooperation with the political subdivision, prepare a STAR bond project plan in consultation with the planning commission of the political subdivision, if any. The STAR bond project plan may be implemented in separate development stages.

(b) Any political subdivision considering a STAR bond project within a STAR bond district shall notify the Department, which shall cause to be prepared an independent feasibility study by a feasibility consultant with certified copies provided to the political subdivision, the Director, and the Department of Commerce and Economic Opportunity. The feasibility study shall include the following:

(1) the estimated amount of pledged STAR revenues expected to be collected in each year through the maturity date of the proposed STAR bonds;

(2) a statement of how the jobs and taxes obtained from the STAR bond project will contribute significantly to the economic development of the State and region;

(3) visitation expectations;

(4) the unique quality of the project;

(5) an economic impact study;

(6) a market study;

(7) integration and collaboration with other resources or businesses;

(8) the quality of service and experience provided, as measured against national consumer standards for the specific target market;

(9) project accountability, measured according to best industry practices;

(10) the expected return on State and local investment that the STAR bond project is anticipated to produce; and

(11) an anticipated principal and interest payment schedule on the STAR bonds.

The feasibility consultant, along with the independent economist and any other consultants commissioned to perform the studies and other analysis required by the feasibility study, shall be selected by the Director with the approval of the political subdivision. The consultants shall be retained by the Director and the Department shall be reimbursed by the master developer for the costs to retain the consultants.

The failure to include all information enumerated in this subsection in the feasibility study for a STAR bond project shall not affect the validity of STAR bonds issued pursuant to this Act.

(c) If the political subdivision determines the STAR bond project is feasible, the STAR bond project plan shall include:

(1) a summary of the feasibility study;

(2) a reference to the STAR bond district plan that identifies the STAR bond project area that is set forth in the STAR bond project plan that is being considered;

(3) a legal description and map of the STAR bond project area to be developed or redeveloped;

(4) a description of the buildings and facilities proposed to be constructed or improved in such STAR bond project area, including destination users and an entertainment user, as applicable;

(5) a copy of letters of intent to locate within the STAR bond district signed by both the master developer and the appropriate corporate officer of a destination user and an entertainment user for the first STAR bond project proposed within the district; and

(6) any other information the governing body of the political subdivision deems reasonable and necessary to advise the public of the intent of the STAR bond project plan.

(d) Before a political subdivision may hold a public hearing to consider a STAR bond project plan, the Department of Commerce and Economic Opportunity shall hold a regional public meeting to discuss, evaluate, and review the merits of the STAR bond project plan. The public meeting shall be held at a location that is within 20 miles of the STAR bond district, in a facility that can accommodate a large crowd, and in a facility that is accessible to persons with disabilities. The public meeting shall be held within 20 days after the receipt of the feasibility study by the Director. Notice of the public meeting shall be delivered to the Director and the political subdivision and shall be published once in a newspaper of general circulation in the political subdivision not less than one week and not more than 3 weeks preceding the date of the public meeting. At the public meeting, all interested persons shall be given an opportunity to be heard. At the conclusion of the public meeting, the Department of Commerce and Economic Opportunity shall provide a report to the Director concerning the testimony of the public meeting.

(e) Before a political subdivision may hold a public hearing to consider a STAR bond project plan, the political subdivision must apply to the Department for approval of the STAR bond project plan. An application for approval of a STAR bond project plan must not be approved unless all of the components of the feasibility study set forth in items (1) through (11) of subsection (b) have been completed and submitted to the Department for review. In addition to reviewing all of the other elements of the STAR bond project plan required under subsection (c), which must be included in the application (which plan must include a letter or letters of intent as required under subdivision (c)(5) in order to receive Director approval), the Director must review the feasibility study and consider all of the components of the feasibility study set forth in items (1) through (11) of subsection (b) of Section 20, including without limitation the economic impact study and the financial benefit of the proposed STAR bond project to the local, regional, and State economies, the proposed adverse impacts on similar businesses and projects as well as municipalities within the market area, and the net effect of the proposed STAR bond project on the local, regional, and State economies. In addition to the economic impact study, the political subdivision must also submit to the Department, as part of its application, the financial and other information that substantiates the basis for the conclusion of the economic impact study, in the form and manner as required by the Department, so that the Department can verify the results of the study. In addition to any other criteria in this subsection, to approve the STAR bond project plan, the Director must be satisfied that the proposed destination user is in fact a true destination user and also find that the STAR bond project plan is in accordance with the purpose of this Act and the public interest. The Director shall either approve or deny the STAR bond project plan based on the criteria in this subsection.

(f) Upon a finding by the planning and zoning commission of the political subdivision that the STAR bond project plan is consistent with the intent of the comprehensive plan for the development of the political subdivision and upon issuance of the written approval of the STAR bond project plan from the Director pursuant to subsection (e) of Section 20 the governing body of the political subdivision shall adopt a resolution stating that the political subdivision is considering the adoption of the STAR bond project plan. The resolution shall:

(1) give notice that a public hearing will be held to consider the adoption of the STAR bond project plan and fix the date, hour, and place of the public hearing;

(2) describe the general boundaries of the STAR bond district within which the STAR bond project will be located and the date of establishment of the STAR bond district;

(3) describe the general boundaries of the area proposed to be included within the STAR bond project area;

(4) provide that the STAR bond project plan and map of the area to be redeveloped or developed are available for inspection during regular office hours in the offices of the political subdivision; and

(5) contain a summary of the terms and conditions of any proposed project development agreement with the political subdivision.

(g) A public hearing shall be conducted to consider the adoption of any STAR bond project plan.

(1) The date fixed for the public hearing to consider the adoption of the STAR bond project plan shall be not less than 20 nor more than 90 days following the date of the adoption of the resolution fixing the date of the hearing.

(2) A copy of the political subdivision's resolution providing for the public hearing shall be sent by certified mail, return receipt requested, to the governing body of the county. A copy of the political subdivision's resolution providing for the public hearing shall be sent by certified mail, return receipt requested, to each person or persons in whose name the general taxes for the last preceding year were paid on each parcel of land lying within the proposed STAR bond project area within 10 days following the date of the adoption of the resolution. The resolution shall be published once in a newspaper of general circulation in the political subdivision not less than one week nor more than 3 weeks preceding the date fixed for the public hearing. A map or aerial photo clearly delineating the area of land proposed to be included within the STAR bond project area shall be published with the resolution.

(3) The hearing shall be held at a location that is within 20 miles of the STAR bond district, in a facility that can accommodate a large crowd, and in a facility that is accessible to persons with disabilities.

(4) At the public hearing, a representative of the political subdivision or master developer shall present the STAR bond project plan. Following the presentation of the STAR bond project plan, all interested persons shall be given an opportunity to be heard. The governing body may continue the date and time of the public hearing.

(h) Upon conclusion of the public hearing, the governing body of the political subdivision may adopt the STAR bond project plan by a resolution approving the STAR bond project plan.

(i) After the adoption by the corporate authorities of the political subdivision of a STAR bond project plan, the political subdivision may enter into a project development agreement if the master developer has requested the political subdivision to be a party to the project development agreement pursuant to subsection (b) of Section 25.

(j) Within 30 days after the adoption by the political subdivision of a STAR bond project plan, the clerk of the political subdivision shall transmit a copy of the legal description of the land and a list of all new and existing mailing addresses within the STAR bond district, a copy of the resolution adopting the STAR bond project plan, and a map or plat indicating the boundaries of the STAR bond project area to the clerk, treasurer, and governing body of the county and to the Department of Revenue. Within 30 days of creation of any new mailing addresses within a STAR bond district, the clerk of the political subdivision shall provide written notice of such new addresses to the Department of Revenue.

If a certified copy of the resolution adopting the STAR bond project plan is filed with the Department on or before the first day of April, the Department, if all other requirements of this subsection are met, shall proceed to collect and allocate any local sales tax increment and any State sales tax increment in accordance with the provisions of this Act as of the first day of July next following the adoption and filing. If a certified copy of the resolution adopting the STAR bond project plan is filed with the Department after April 1 but on or before the first day of October, the Department, if all other requirements of this subsection are met, shall proceed to collect and allocate any local sales tax increment and any State sales tax increment in accordance with the provisions of this Act as of the first day of January next following the adoption and filing.

Any substantial changes to a STAR bond project plan as adopted shall be subject to a public hearing following publication of notice thereof in a newspaper of general circulation in the political subdivision and approval by resolution of the governing body of the political subdivision.

The Department of Revenue shall not collect or allocate any local sales tax increment or State sales tax increment, until the political subdivision also provides, in the manner prescribed by the Department, the boundaries of the STAR bond project area and each address in the STAR bond project area in such a way that the Department can determine by its address whether a business is located in the STAR bond project area. The political subdivision must provide this boundary and address information to the Department on or before April 1 for administration and enforcement under this Act by the Department beginning on the following July 1 and on or before October 1 for administration and enforcement under this Act by the Department beginning on the following January 1. The Department of Revenue shall not administer or enforce any change made to the boundaries of a STAR bond project or any address change, addition, or deletion until the political subdivision reports the boundary change or address change, addition, or deletion to the Department in the manner prescribed by the Department. The political subdivision must provide this boundary change or address change, addition, or deletion information to the Department on or before April 1 for administration and enforcement by the Department of the change, addition, or deletion beginning on the following July 1 and on or before October 1 for administration and enforcement by the Department of the change, addition, or deletion beginning on the following January 1. If a retailer is incorrectly included or excluded from the list of those located in the STAR bond project, the Department of Revenue shall be held harmless if it reasonably relied on information provided by the political subdivision.

(k) Any STAR bond project must be approved by the political subdivision prior to that date which is 23 years from the date of the approval of the STAR bond district, provided however that any amendments to such STAR bond project may occur following such date.

(l) Any developer of a STAR bond project shall commence work on the STAR bond project within 3 years from the date of adoption of the STAR bond project plan. If the developer fails to commence work on the STAR bond project within the 3-year period, funding for the project shall cease and the developer of the project or complex shall have one year to appeal to the political subdivision for reapproval of the project and funding. If the project is reapproved, the 3-year period for commencement shall begin again on the date of the reapproval.

(m) After the adoption by the corporate authorities of the political subdivision of a STAR bond project plan and approval of the Director pursuant to subsection (e) of Section 20, the political subdivision may authorize the issuance of the STAR bonds in one or more series to finance the STAR bond project in accordance with the provisions of this Act.

(n) The maximum maturity of STAR bonds issued to finance a STAR bond project shall not exceed 23 years from the first date of distribution of State sales tax revenues from such STAR bond project to the political subdivision, unless the political subdivision extends such maturity by resolution up to a maximum of 35 years from such first distribution date. Any such extension shall require the approval of the Director. In no event shall the maximum maturity date for any STAR bonds exceed that date which is 35 years from the first distribution date of the first STAR bonds issued in a STAR bond district.

Section 25. Co-developers and subdevelopers. Upon approval of a STAR bond project by the political subdivision, the master developer may, subject to the approval of the Director and the political subdivision, develop the STAR bond project on its own or it may develop the STAR bond project with another developer, which may include an assignment or transfer of development rights.

(a) A master developer may sell, lease, or otherwise convey its property interest in the STAR bond project area to a co-developer or subdeveloper.

(b) A master developer may enter into one or more agreements with a co-developer or subdeveloper in connection with a STAR bond project, and the master developer may request that the political subdivision become a party to the project development agreement, or the master developer may request that the political subdivision amend its master development agreement to provide for certain terms and conditions that may be related to the co-developer or subdeveloper and the STAR bond project. For any project development agreement which the political subdivision would be a party or for any amendments to the master development agreement, the terms and conditions must be acceptable to both the master developer and the political subdivision.

Section 30. STAR bonds; source of payment. Any political subdivision shall have the power to issue STAR bonds in one or more series to finance the undertaking of any STAR bond project in accordance with the provisions of this Act and the Omnibus Bond Acts. STAR bonds may be issued as revenue bonds, alternate bonds, or general obligation bonds as defined in and subject to the procedures provided in the Local Government Debt Reform Act.

(a) STAR bonds may be made payable, both as to principal and interest, from the following revenues, which to the extent pledged by each respective political subdivision or other public entity for such purpose shall constitute pledged STAR revenues:

(1) revenues of the political subdivision derived from or held in connection with the undertaking and carrying out of any STAR bond project or projects under this Act;

(2) available private funds and contributions, grants, tax credits, or other financial assistance from the State or federal government;

(3) all of the local sales tax increment of a municipality, county, or other unit of local government;

(4) any special service area taxes collected within the STAR bond district under the Special Service Area Tax Act, may be used for the purposes of funding project costs or paying debt service on STAR bonds in addition to the purposes contained in the special service area plan;

(5) all of the State sales tax increment;

(6) any other revenues appropriated by the political subdivision; and

(7) any combination of these methods.

(b) The political subdivision may pledge the pledged STAR revenues to the repayment of STAR bonds prior to, simultaneously with, or subsequent to the issuance of the STAR bonds.

(c) Bonds issued as revenue bonds shall not be general obligations of the political subdivision, nor in any event shall they give rise to a charge against its general credit or taxing powers, or be payable out of any funds or properties other than those set forth in subsection (a) and the bonds shall so state on their face.

(d) For each STAR bond project financed with STAR bonds payable from the pledged STAR revenues, the political subdivision shall prepare and submit to the Department of Revenue by June 1 of each year a report describing the status of the STAR bond project, any expenditures of the proceeds of STAR bonds that have occurred for the preceding calendar year, and any expenditures of the proceeds of the bonds expected to occur in the future, including the amount of pledged STAR revenue, the amount of revenue that has been spent, the projected amount of the revenue, and the anticipated use of the revenue. Each annual report shall be accompanied by an affidavit of the master developer certifying the contents of the report as true to the best of the master developer's knowledge. The Department of Revenue shall have the right, but not the obligation, to request the Illinois Auditor General to review the annual report and the political subdivision's records containing the source information for the report for the purpose of verifying the report's contents. If the Illinois Auditor General declines the request for review, the Department of Revenue shall have the right to select an independent third-party auditor to conduct an audit of the annual report and the political subdivision's records containing the source information for the report. The reasonable cost of the audit shall be paid by the master developer. The master development agreement shall grant the Department of Revenue and the Illinois Auditor General the right to review the records of the political subdivision containing the source information for the report.

(e) There is created in the State treasury a special fund to be known as the STAR Bonds Revenue Fund. As soon as possible after the first day of each month, beginning January 1, 2011, upon certification of the Department of Revenue, the Comptroller shall order transferred, and the Treasurer shall transfer, from the General Revenue Fund to the STAR Bonds Revenue Fund the State sales tax increment for the second preceding month, less 3% of that amount, which shall be transferred into the Tax Compliance and Administration Fund and shall be used by the Department, subject to appropriation, to cover the costs of the Department in administering the STAR Bonds Financing Act. As soon as possible after the first day of each month, beginning January 1, 2011, upon certification of the Department of Revenue, the Comptroller shall order transferred, and the Treasurer shall transfer, from the Local Government Tax Fund to the STAR Bonds Revenue Fund the local sales tax increment for the second preceding month, as provided in Section 6z-18 of the State Finance Act and from the County and Mass Transit District Fund to the STAR Bonds Revenue Fund the local sales tax increment for the second preceding month, as provided in Section 6z-20 of the State Finance Act.

On or before the 25th day of each calendar month, beginning on January 1, 2011, the Department shall prepare and certify to the Comptroller the disbursement of stated sums of money out of the STAR Bonds Revenue Fund to named municipalities and counties, the municipalities and counties to be those entitled to distribution of taxes or penalties paid to the Department during the second preceding calendar month. The amount to be paid to each municipality or county shall be the amount of the State sales tax increment and the local sales tax increment (not including credit memoranda or the amount transferred into the Tax Compliance and Administration Fund) collected during the second preceding calendar month by the Department from retailers and servicemen on transactions at places of business located within a STAR bond district in that municipality or county, plus an amount the Department determines is necessary to offset any amounts which were erroneously paid to a different taxing body, and not including an amount equal to the amount of refunds made during the second preceding calendar month by the Department, and not including any amount which the Department determines is necessary to offset any amounts which are payable to a different taxing body but were erroneously paid to the municipality or county. Within 10 days after receipt, by the Comptroller, of the disbursement certification to the municipalities and counties, provided for in this Section to be given to the Comptroller by the Department, the Comptroller shall cause the orders to be drawn for the respective amounts in accordance with the directions contained in such certification.

When certifying the amount of monthly disbursement to a municipality or county under this subsection, the Department shall increase or decrease that amount by an amount necessary to offset any misallocation of previous disbursements. The offset amount shall be the amount erroneously disbursed within the 6 months preceding the time a misallocation is discovered.

(f) As of the seventh anniversary of the first date of distribution of State sales tax revenues from the first STAR bond project in the STAR bond district, and as of every fifth anniversary thereafter until final maturity of all STAR bonds issued in a STAR bond district, the aggregate proceeds of STAR bonds issued to date for the STAR bond district shall not exceed 50% of the total development costs in the STAR bond district to date. The Illinois Auditor General shall make the foregoing determination on said seventh anniversary and every 5 years thereafter until final maturity of all STAR bonds issued in a STAR bond district. If at any time after the seventh anniversary of the first date of distribution of State sales tax revenues from the first STAR bond project in the STAR bond district the Illinois Auditor General determines that the aggregate proceeds of STAR bonds issued to date for the STAR bond district have exceeded 50% of the total development costs in the STAR bond district, no additional STAR bonds may be issued in the STAR bond district until the percentage is reduced to 50% or below. When the percentage has been reduced to 50% or below, the master developer shall have the right, at its own cost, to obtain a new audit prepared by an independent third-party auditor verifying compliance and shall provide such audit to the Illinois Auditor General for review and approval. Upon the Illinois Auditor General's determination from the audit that the percentage has been reduced to 50% or below, STAR bonds may again be issued in the STAR bond district.

Section 31. STAR bond occupation taxes.

(a) If the corporate authorities of a political subdivision have established a STAR bond district and have elected to impose a tax by ordinance pursuant to subsection (b) or (c) of this Section, each year after the date of the adoption of the ordinance and until all STAR bond project costs and all political subdivision obligations financing the STAR bond project costs, if any, have been paid in accordance with the STAR bond project plans, but in no event longer than the maximum maturity date of the last of the STAR bonds issued for projects in the STAR bond district, all amounts generated by the retailers' occupation tax and service occupation tax shall be collected and the tax shall be enforced by the Department of Revenue in the same manner as all retailers' occupation taxes and service occupation taxes imposed in the political subdivision imposing the tax. The corporate authorities of the political subdivision shall deposit the proceeds of the taxes imposed under subsections (b) and (c) into a special fund held by the corporate authorities of the political subdivision called the STAR Bonds Tax Allocation Fund for the purpose of paying STAR bond project costs and obligations incurred in the payment of those costs.

The tax imposed under this Section by a municipality may be imposed only on the portion of a STAR bond district that is within the boundaries of the municipality. For any part of a STAR bond district that lies outside of the boundaries of that municipality, the municipality in which the other part of the STAR bond district lies (or the county, in cases where a portion of the STAR bond district lies in the unincorporated area of a county) is authorized to impose the tax under this Section on that part of the STAR bond district.

(b) The corporate authorities of a political subdivision that has established a STAR bond district under this Act may, by ordinance or resolution, impose a STAR Bond Retailers' Occupation Tax upon all persons engaged in the business of selling tangible personal property, other than an item of tangible personal property titled or registered with an agency of this State's government, at retail in the STAR bond district at a rate not to exceed 1% of the gross receipts from the sales made in the course of that business, to be imposed only in 0.25% increments. The tax may not be imposed on food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, soft drinks, and food that has been prepared for immediate consumption), prescription and nonprescription medicines, drugs, medical appliances, modifications to a motor vehicle for the purpose of rendering it usable by a disabled person, and insulin, urine testing materials, syringes, and needles used by diabetics, for human use.

The tax imposed under this subsection and all civil penalties that may be assessed as an incident thereof shall be collected and enforced by the Department of Revenue. The certificate of registration that is issued by the Department to a retailer under the Retailers' Occupation Tax Act shall permit the retailer to engage in a business that is taxable under any ordinance or resolution enacted pursuant to this subsection without registering separately with the Department under such ordinance or resolution or under this subsection. The Department of Revenue shall have full power to administer and enforce this subsection; to collect all taxes and penalties due under this subsection in the manner hereinafter provided; and to determine all rights to credit memoranda arising on account of the erroneous payment of tax or penalty under this subsection. In the administration of, and compliance with, this subsection, the Department and persons who are subject to this subsection shall have the same rights, remedies, privileges, immunities, powers, and duties, and be subject to the same conditions, restrictions, limitations, penalties, exclusions, exemptions, and definitions of terms and employ the same modes of procedure, as are prescribed in Sections 1, 1a through 1o, 2 through 2-65 (in respect to all provisions therein other than the State rate of tax), 2c through 2h, 3 (except as to the disposition of taxes and penalties collected), 4, 5, 5a, 5b, 5c, 5d, 5e, 5f, 5g, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 7, 8, 9, 10, 11, 12, 13, and 14 of the Retailers' Occupation Tax Act and all provisions of the Uniform Penalty and Interest Act, as fully as if those provisions were set forth herein.

If a tax is imposed under this subsection (b), a tax shall also be imposed under subsection (c) of this Section.

(c) If a tax has been imposed under subsection (b), a STAR Bond Service Occupation Tax shall also be imposed upon all persons engaged, in the STAR bond district, in the business of making sales of service, who, as an incident to making those sales of service, transfer tangible personal property within the STAR bond district, either in the form of tangible personal property or in the form of real estate as an incident to a sale of service. The tax shall be imposed at the same rate as the tax imposed in subsection (b) and shall not exceed 1% of the selling price of tangible personal property so transferred within the STAR bond district, to be imposed only in 0.25% increments. The tax may not be imposed on food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, soft drinks, and food that has been prepared for immediate consumption), prescription and nonprescription medicines, drugs, medical appliances, modifications to a motor vehicle for the purpose of rendering it usable by a disabled person, and insulin, urine testing materials, syringes, and needles used by diabetics, for human use.

The tax imposed under this subsection and all civil penalties that may be assessed as an incident thereof shall be collected and enforced by the Department of Revenue. The certificate of registration that is issued by the Department to a retailer under the Retailers' Occupation Tax Act or under the Service Occupation Tax Act shall permit the registrant to engage in a business that is taxable under any ordinance or resolution enacted pursuant to this subsection without registering separately with the Department under that ordinance or resolution or under this subsection. The Department of Revenue shall have full power to administer and enforce this subsection; to collect all taxes and penalties due under this subsection; to dispose of taxes and penalties so collected in the manner hereinafter provided; and to determine all rights to credit memoranda arising on account of the erroneous payment of tax or penalty under this subsection. In the administration of, and compliance with this subsection, the Department and persons who are subject to this subsection shall have the same rights, remedies, privileges, immunities, powers, and duties, and be subject to the same conditions, restrictions, limitations, penalties, exclusions, exemptions, and definitions of terms and employ the same modes of procedure as are prescribed in Sections 2, 2a through 2d, 3 through 3-50 (in respect to all provisions therein other than the State rate of tax), 4 (except that the reference to the State shall be to the STAR bond district), 5, 7, 8 (except that the jurisdiction to which the tax shall be a debt to the extent indicated in that Section 8 shall be the political subdivision), 9 (except as to the disposition of taxes and penalties collected, and except that the returned merchandise credit for this tax may not be taken against any State tax), 10, 11, 12 (except the reference therein to Section 2b of the Retailers' Occupation Tax Act), 13 (except that any reference to the State shall mean the political subdivision), the first paragraph of Section 15, and Sections 16, 17, 18, 19 and 20 of the Service Occupation Tax Act and all provisions of the Uniform Penalty and Interest Act, as fully as if those provisions were set forth herein.

If a tax is imposed under this subsection (c), a tax shall also be imposed under subsection (b) of this Section.

(d) Persons subject to any tax imposed under this Section may reimburse themselves for their seller's tax liability under this Section by separately stating the tax as an additional charge, which charge may be stated in combination, in a single amount, with State taxes that sellers are required to collect under the Use Tax Act, in accordance with such bracket schedules as the Department may prescribe.

Whenever the Department determines that a refund should be made under this Section to a claimant instead of issuing a credit memorandum, the Department shall notify the State Comptroller, who shall cause the order to be drawn for the amount specified and to the person named in the notification from the Department. The refund shall be paid by the State Treasurer out of the STAR bond retailers' occupation tax fund.

The Department shall immediately pay over to the State Treasurer, ex officio, as trustee, all taxes, penalties, and interest collected under this Section for deposit into the STAR bond retailers' occupation tax fund. On or before the 25th day of each calendar month, the Department shall prepare and certify to the Comptroller the disbursement of stated sums of money to named political subdivisions from the STAR bond retailers' occupation tax fund, the political subdivisions to be those from which retailers have paid taxes or penalties under this Section to the Department during the second preceding calendar month. The amount to be paid to each political subdivision shall be the amount (not including credit memoranda) collected under this Section during the second preceding calendar month by the Department plus an amount the Department determines is necessary to offset any amounts that were erroneously paid to a different taxing body, and not including an amount equal to the amount of refunds made during the second preceding calendar month by the Department, less 3% of that amount, which shall be deposited into the Tax Compliance and Administration Fund and shall be used by the Department, subject to appropriation, to cover the costs of the Department in administering and enforcing the provisions of this Section, on behalf of such political subdivision, and not including any amount that the Department determines is necessary to offset any amounts that were payable to a different taxing body but were erroneously paid to the political subdivision. Within 10 days after receipt by the Comptroller of the disbursement certification to the political subdivisions provided for in this Section to be given to the Comptroller by the Department, the Comptroller shall cause the orders to be drawn for the respective amounts in accordance with the directions contained in the certification. The proceeds of the tax paid to political subdivisions under this Section shall be deposited into the STAR Bonds Tax Allocation Fund by the political subdivision.

An ordinance or resolution imposing or discontinuing the tax under this Section or effecting a change in the rate thereof shall either (i) be adopted and a certified copy thereof filed with the Department on or before the first day of April, whereupon the Department, if all other requirements of this Section are met, shall proceed to administer and enforce this Section as of the first day of July next following the adoption and filing; or (ii) be adopted and a certified copy thereof filed with the Department on or before the first day of October, whereupon, if all other requirements of this Section are met, the Department shall proceed to administer and enforce this Section as of the first day of January next following the adoption and filing.

The Department of Revenue shall not administer or enforce an ordinance imposing, discontinuing, or changing the rate of the tax under this Section, until the political subdivision also provides, in the manner prescribed by the Department, the boundaries of the STAR bond district and each address in the STAR bond district in such a way that the Department can determine by its address whether a business is located in the STAR bond district. The political subdivision must provide this boundary and address information to the Department on or before April 1 for administration and enforcement of the tax under this Section by the Department beginning on the following July 1 and on or before October 1 for administration and enforcement of the tax under this Section by the Department beginning on the following January 1. The Department of Revenue shall not administer or enforce any change made to the boundaries of a STAR bond district or any address change, addition, or deletion until the political subdivision reports the boundary change or address change, addition, or deletion to the Department in the manner prescribed by the Department. The political subdivision must provide this boundary change or address change, addition, or deletion information to the Department on or before April 1 for administration and enforcement by the Department of the change, addition, or deletion beginning on the following July 1 and on or before October 1 for administration and enforcement by the Department of the change, addition, or deletion beginning on the following January 1. The retailers in the STAR bond district shall be responsible for charging the tax imposed under this Section. If a retailer is incorrectly included or excluded from the list of those required to collect the tax under this Section, both the Department of Revenue and the retailer shall be held harmless if they reasonably relied on information provided by the political subdivision.

A political subdivision that imposes the tax under this Section must submit to the Department of Revenue any other information as the Department may require for the administration and enforcement of the tax.

When certifying the amount of a monthly disbursement to a political subdivision under this Section, the Department shall increase or decrease the amount by an amount necessary to offset any misallocation of previous disbursements. The offset amount shall be the amount erroneously disbursed within the previous 6 months from the time a misallocation is discovered.

Nothing in this Section shall be construed to authorize the political subdivision to impose a tax upon the privilege of engaging in any business which under the Constitution of the United States may not be made the subject of taxation by this State.

(e) When STAR bond project costs, including, without limitation, all political subdivision obligations financing STAR bond project costs, have been paid, any surplus funds then remaining in the STAR Bonds Tax Allocation Fund shall be distributed to the treasurer of the political subdivision for deposit into the political subdivision's general corporate fund. Upon payment of all STAR bond project costs and retirement of obligations, but in no event later than the maximum maturity date of the last of the STAR bonds issued in the STAR bond district, the political subdivision shall adopt an ordinance immediately rescinding the taxes imposed pursuant to this Section and file a certified copy of the ordinance with the Department in the form and manner as described in this Section.

Section 33. STAR Bonds Community Improvement Trust Fund.

(a) The STAR Bonds Community Improvement Trust Fund is created as a trust fund in the State treasury. Deposits into the Trust Fund shall be made as provided under this Section. Moneys in the Trust Fund shall be used by the Department of Revenue only for the purpose of making payments to municipalities that lie within a 12 mile radius of the political subdivision in which the STAR bond district is located and the county in which the STAR bond district is located. Moneys in the Trust Fund are not subject to appropriation and shall be used solely as provided in this Section. All deposits into the Trust Fund shall be held in the Trust Fund by the State Treasurer as ex officio custodian separate and apart from all public moneys or funds of this State and shall be administered by the Department exclusively for the purposes set forth in this Section. All moneys in the Trust Fund shall be invested and reinvested by the State Treasurer. All interest accruing from these investments shall be deposited in the Trust Fund.

(b) Upon approval of a STAR bond district by the Director, the political subdivision shall immediately transmit to the county clerk of the county in which the district is located a certified copy of the ordinance creating the district, a legal description of the district, a map of the district, identification of the year that the county clerk shall use for determining the total initial equalized assessed value of the district consistent with subsection (c), and a list of the parcel or tax identification number of each parcel of property included in the district.

(c) Upon approval of a STAR bond district, the county clerk immediately thereafter shall determine (i) the most recently ascertained equalized assessed value of each lot, block, tract, or parcel of real property within the STAR bond district, from which shall be deducted the homestead exemptions under Article 15 of the Property Tax Code, which value shall be the initial equalized assessed value of each such piece of property, and (ii) the total equalized assessed value of all taxable real property within the district by adding together the most recently ascertained equalized assessed value of each taxable lot, block, tract, or parcel of real property within the district, from which shall be deducted the homestead exemptions under Article 15 of the Property Tax Code, and shall certify that amount as the total initial equalized assessed value of the taxable real property within the STAR bond district.

(d) In reference to any STAR bond district created within any political subdivision, and in respect to which the county clerk has certified the total initial equalized assessed value of the property in the area, the political subdivision may thereafter request the clerk in writing to adjust the initial equalized value of all taxable real property within the STAR bond district by deducting therefrom the exemptions under Article 15 of the Property Tax Code applicable to each lot, block, tract, or parcel of real property within the STAR bond district. The county clerk shall immediately after the written request to adjust the total initial equalized value is received determine the total homestead exemptions in the STAR bond district as provided under Article 15 of the Property Tax Code by adding together the homestead exemptions provided by said Article on each lot, block, tract, or parcel of real property within STAR bond district and then shall deduct the total of said exemptions from the total initial equalized assessed value. The county clerk shall then promptly certify that amount as the total initial equalized assessed value as adjusted of the taxable real property within the STAR bond district.

(e) The county clerk or other person authorized by law shall compute the tax rates for each taxing district with all or a portion of its equalized assessed value located in the STAR bond district. The rate per cent of tax determined shall be extended to the current equalized assessed value of all property in the district in the same manner as the rate per cent of tax is extended to all other taxable property in the taxing district.

(f) Beginning with the assessment year in which the first destination user in the first STAR bond project in a STAR bond district makes its first retail sales and for each assessment year thereafter until final maturity of the last STAR bonds issued in the district, the county clerk or other person authorized by law shall determine the increase in equalized assessed value of all real property within the STAR bond district by subtracting the initial equalized assessed value of all property in the district certified under subsection (c) from the current equalized assessed value of all property in the district. Each year, the property taxes arising from the increase in equalized assessed value in the STAR bond district shall be determined for each taxing district and shall be certified to the county collector.

(g) Beginning with the year in which taxes are collected based on the assessment year in which the first destination user in the first STAR bond project in a STAR bond district makes its first retail sales and for each year thereafter until final maturity of the last STAR bonds issued in the district, the county collector shall, within 30 days after receipt of property taxes, transmit to the Department to be deposited into the STAR Bonds Community Improvement Trust Fund 15% of property taxes attributable to the increase in equalized assessed value within the STAR bond district from each taxing district as certified in subsection (f).

(h) The Department shall pay to each municipality that lies within 12 miles of the STAR bond district (excluding the municipality in which the STAR bond district is located) and to the county in which the STAR bond district is located for each year for which money is remitted to the Department and paid into the STAR Bonds Community Improvement Trust Fund, a portion of the money in the Fund as provided in this subsection. The money in the Fund shall first be allocated such that 35% of the money is paid to the municipalities that lie within 5 miles of the STAR bond district (excluding the municipality in which the STAR bond district is located), with the balance being paid to the municipalities that lie more than 5 but no more than 12 miles from the STAR bond district and the county. The amount paid to each political subdivision (after allocating 35% to municipalities that lie within 5 miles of the STAR bond district and 65% to the municipalities that lie more than 5 but not more than 12 miles from the STAR bond district and the county) shall be based on each qualifying municipality or county's proportionate share of the total municipal and county sales tax generated within a 12 mile radius of the STAR bond district (excluding the municipality in which the STAR bond district is located) as measured over the 4 years immediately prior to the year in which the first retail sales are made in the district.

The Department shall determine the distributions under this Section using its best judgment and information. The Department shall be held harmless for the distributions made under this Section and all distributions shall be final.

(i) In any year that an assessment appeal is filed, the extension of taxes on any assessment so appealed shall not be delayed. In the case of an assessment that is altered, any taxes extended upon the unauthorized assessment or part thereof shall be abated, or, if already paid, shall be refunded with interest as provided in Section 23-20 of the Property Tax Code. In the case of an assessment appeal, the county collector shall notify the Department that an assessment appeal has been filed and the amount of the tax that would have been deposited in the STAR Bond Community Improvement Fund. The county collector shall hold that amount in a separate fund until the appeal process is final. After the appeal process is finalized, the county collector shall transmit to the Department the amount of tax that remains, if any, after all required refunds are made. The Department shall pay any amount deposited into the Trust Fund under this Section in the same proportion as determined for payments for that taxable year under subsection (h).

(j) In any year that ad valorem taxes are allocated to the STAR Bonds Community Improvement Trust Fund, that allocation shall not reduce or otherwise impact the school aid provided to any school district under the general State school aid formula provided for in Section 18-8.05 of the School Code.

Section 34. STAR bond district property tax. To assist in the provision of special services that will necessarily be required by a STAR bond district, the political subdivision forming a STAR bond district shall, subject to item (6) of Section 7 of Article VII of the Illinois Constitution, have the power to levy a tax on the equalized assessed value of property within the STAR bond district to be known as the "STAR bond district property tax". For purposes of this Section, the corporate authorities of the political subdivision forming the STAR bond district shall be the governing body of the STAR bond district. The powers vested in political subdivisions under this Section shall be in addition to those set forth in the Special Service Area Tax Law.

(a) The STAR bond district property tax may be annually levied or imposed by the political subdivision in the STAR bond district in an amount equal to 1% of the equalized assessed value. Prior to the first levy of the STAR bond district property tax, notice shall be furnished at least once in a newspaper of general circulation within the political subdivision not less than 15 days prior to the first levy. For purposes of this Section, the notice shall include: (i) the boundaries of the STAR bond district by legal description and, where possible, by street location; (ii) the permanent tax index number of each parcel located within the STAR bond district; and (iii) a statement that the proposed tax is to be levied pursuant to this Section to pay for the provision of certain special services provided to the STAR bond district.

After the first levy of the STAR bond district property tax within the STAR bond district, the tax may continue to be levied in subsequent years without the requirement of an additional public notice until such time as the STAR bond district is terminated pursuant to this Act.

(b) No STAR bond district property tax lien shall be established against any real property in a STAR bond district nor shall a STAR bond district property tax be valid before a certified copy of the ordinance or ordinances establishing the STAR bond district property tax and establishing or altering the boundaries of the STAR bond district, including a legal description of the territory of the STAR bond district, the permanent tax index numbers of the parcels located within the STAR bond district, an accurate map of the STAR bond district, and a copy of the notice is filed for record in the office of the recorder in each county in which any part of the STAR bond district is located. The ordinance must be recorded no later than 60 days after the date the ordinance establishing the STAR bond district property tax was adopted.

(c) If the STAR bond district property tax is levied, the tax shall be extended by the county clerk in the STAR bond district in the manner provided by Articles 1 through 26 of the Property Tax Code based on equalized assessed values as established under Articles 1 through 26 of the Property Tax Code. The political subdivision shall file a certified copy of the ordinance creating the STAR bond district, including an accurate map thereof, with the county clerk. The corporate authorities of the political subdivision may levy taxes in the STAR bond district prior to the date the levy must be filed with the county clerk, for the same year in which the ordinance and map are filed with the county clerk. In addition, the corporate authorities shall file a certified copy of each ordinance levying the STAR bond district property tax on or before the last Tuesday of December of each year and shall file a certified copy of any ordinance authorizing the issuance of bonds by December 31 of the year of the first levy.

Section 35. Alternate bonds and general obligation bonds. A political subdivision shall have the power to issue alternate revenue and other general obligation bonds to finance the undertaking, establishment, or redevelopment of any STAR bond project as provided and pursuant to the procedures set forth in the Local Government Debt Reform Act. A political subdivision shall have the power to issue general obligation bonds to finance the undertaking, establishment, or redevelopment of any STAR bond project on approval by the voters of the political subdivision of a proposition authorizing the issue of such bonds.

The full faith and credit of the State, any department, authority, public corporation or quasi-public corporation of the State, any State college or university, or any other public agency created by the State shall not be pledged for any payment under any obligation authorized by this Act.

Section 40. Amendments to STAR bond district. Any addition of real property to a STAR bond district or any substantial change to a STAR bond district plan shall be subject to the same procedure for public notice, hearing, and approval as is required for the establishment of the STAR bond district pursuant to this Act.

(a) The addition or removal of land to or from a STAR bond district shall require the consent of the master developer of the STAR bond district.

(b) Any land that is outside of, but is contiguous to an established STAR bond district and is subsequently owned, leased, or controlled by the master developer shall be added to a STAR bond district at the request of the master developer and by approval of the political subdivision, provided that the land becomes a part of a STAR bond project area.

(c) If a political subdivision has undertaken a STAR bond project within a STAR bond district, and the political subdivision desires to subsequently remove more than a de minimus amount of real property from the STAR bond district, then prior to any removal of property the political subdivision must provide a revised feasibility study showing that the pledged STAR revenues from the resulting STAR bond district within which the STAR bond project is located are estimated to be sufficient to pay the project costs. If the revenue from the resulting STAR bond district is insufficient to pay the project costs, then the property may not be removed from the STAR bond district. Any removal of real property from a STAR bond district shall be approved by a resolution of the governing body of the political subdivision.

(d) If the boundaries of a STAR bond district are proposed to be enlarged and a STAR bond district property tax has been established pursuant to Section 34, the same notice requirements set forth in subsection (a) of Section 34 shall be complied with prior to implementation of the STAR bond district property tax in any area that becomes, or is proposed to become, a part of the STAR bond district. The property added to the STAR bond district shall be subject to all taxes levied in the district after the property becomes a part of the district.

Section 45. Restrictions. No portion of a STAR bond project shall be financed with tax increment financing pursuant to the Tax Increment Allocation Redevelopment Act, and no moneys deposited into the STAR Bonds Revenue Fund shall be used to fund tax increment financing district projects. An existing district created under the Tax Increment Allocation Redevelopment Act, Industrial Jobs Recovery Law, or County Economic Development Project Area Property Tax Allocation Act may not annex parcels located within a STAR bond district nor may a new district be created that encompasses any portion of a STAR bond district. During any period of time that STAR bonds are outstanding for a STAR bond district, a developer may not use any land located in the STAR bond district for any (i) retail store whose primary business is the sale of automobiles, including trucks and other automotive vehicles with 4 wheels designed for passenger transportation on public streets and thoroughfares or (ii) stadium or facility for playing National Association of Minor League Baseball or Professional Independent Baseball League games.

Section 50. Reporting taxes. Notwithstanding any other provisions of law to the contrary, the Department of Revenue shall provide a certified report of the State sales tax increment and local sales tax increment from all taxpayers within a STAR bond district to the bond trustee, escrow agent, or paying agent for such bonds upon the written request of the political subdivision on or before the 25th day of each month. Such report shall provide a detailed allocation of State sales tax increment and local sales tax increment from each local sales tax and State sales tax reported to the Department of Revenue.

(a) The bond trustee, escrow agent, or paying agent shall keep such sales and use tax reports and the information contained therein confidential, but may use such information for purposes of allocating and depositing the sales and use tax revenues in connection with the bonds used to finance project costs in such STAR bond district. Except as otherwise provided herein, the sales and use tax reports received by the bond trustee, escrow agent, or paying agent shall be subject to the provisions of Chapter 35 of the Illinois Compiled Statutes, including Section 3 of the Retailers' Occupation Tax Act and Section 9 of the Use Tax Act.

(b) The political subdivision shall determine when the amount of sales tax and other revenues that have been collected and distributed to the bond debt service or reserve fund is sufficient to satisfy all principal and interest costs to the maturity date or dates of any STAR bond issued by a political subdivision to finance a STAR bond project and shall give the Department of Revenue written notice of such determination. The notice shall include a date certain on which deposits into the STAR Bonds Revenue Fund for that STAR bond project shall terminate and shall be provided to the Department of Revenue at least 60 days prior to that date. Thereafter, all sales tax and other revenues shall be collected and distributed in accordance with applicable law.

Section 52. Review committee. Upon the seventh anniversary of the first date of distribution of State sales tax revenues from the first STAR bond project in the State, a 6-member STAR bonds review committee shall be formed consisting of one appointee of each of the Director, the Director of the Department of Commerce and Economic Opportunity, the President of the Senate, the Senate Minority Leader, the Speaker of the House, and the House Minority Leader. The review committee shall evaluate the success of all STAR bond districts then existing in the State and make a determination of the comprehensive economic benefits and detriments of STAR bonds in the State as a whole. In making its determination, the review committee shall examine available data regarding job creation, sales revenues, and capital investment in STAR bond districts; development that has occurred and is planned in areas adjacent to STAR bond districts that will not be directly financed with STAR bonds; effects of market conditions on STAR bond districts and the likelihood of future successes based on improving or declining market conditions; retail sales migration and cannibalization of retail sales due to STAR bond districts; and other relevant economic factors. The review committee shall provide the Director, the General Assembly, and the Governor with a written report detailing its findings and shall make a final determination of whether STAR bonds have had, and are likely to continue having, a negative or positive economic impact on the State as a whole. Upon completing and filing its written report, the review committee shall be dissolved. If the review committee's report makes a final determination that STAR bonds have had and are likely to continue having a negative economic impact on the State as a whole, then no new STAR bond districts may thereafter be formed in the State until further action by the General Assembly.

Section 55. Severability. If any provision of this Act or the application thereof to any persons or circumstances is held invalid, such invalidity shall not affect other provisions or application of the Act that can be given effect without the invalid provisions or application and to this end the provisions of this Act are declared to be severable.

Section 57. Rules. The Department of Revenue shall have the authority to adopt such rules as are reasonable and necessary to implement the provisions of this Act. Notwithstanding the foregoing, the Department of Revenue shall have the authority, prior to adoption and approval of those rules, to approve a STAR bond district in accordance with subsection (d) of Section 20 and otherwise administer the Act while those rules are pending adoption and approval.

Section 60. Open meetings and freedom of information. All public hearings related to the administration, formation, implementation, development, or construction of a STAR bond district, STAR bond district plan, STAR bond project, or STAR bond project plan, including but not limited to the public hearings required by Sections 15, 20, and 40 of this Act, shall be held in compliance with the Open Meetings Act. The public hearing records, feasibility study, and other documents that do not otherwise meet a confidentiality exemption shall be subject to the Freedom of Information Act.

Section 62. Powers of political subdivisions. The provisions of this Act are intended to be supplemental and in addition to all other power or authority granted to political subdivisions, shall be construed liberally, and shall not be construed as a limitation of any power or authority otherwise granted. In addition to the powers a political subdivision may have under other provisions of law, a political subdivision shall have all of the following powers in connection with a STAR bond district:

(a) To make and enter into all contracts necessary or incidental to the implementation and furtherance of a STAR bond district plan.

(b) Within a STAR bond district, to acquire by purchase, donation, or lease, and to own, convey, lease, mortgage, or dispose of land and other real or personal property or rights or interests in property and to grant or acquire licenses, easements, and options with respect to property, all in the manner and at a price the political subdivision determines is reasonably necessary to achieve the objectives of the STAR bond project.

(c) To clear any area within a STAR bond district by demolition or removal of any existing buildings, structures, fixtures, utilities, or improvements and to clear and grade land.

(d) To install, repair, construct, reconstruct, extend or relocate public streets, public utilities, and other public site improvements located both within and outside the boundaries of a STAR bond district that are essential to the preparation of a STAR bond district for use in accordance with a STAR bond district plan.

(e) To renovate, rehabilitate, reconstruct, relocate, repair, or remodel any existing buildings, improvements, and fixtures within a STAR bond district.

(f) To install or construct any public buildings, structures, works, streets, improvements, utilities, or fixtures within a STAR bond district.

(g) To issue STAR bonds as provided in this Act.

(h) Subject to the limitations set forth in the definition of "project costs" in Section 10 of this Act, to fix, charge, and collect fees, rents, and charges for the use of any building, facility, or property or any portion of a building, facility, or property owned or leased by the political subdivision in furtherance of a STAR bond project under this Act within a STAR bond district.

(i) To accept grants, guarantees, donations of property or labor, or any other thing of value for use in connection with a STAR bond project.

(j) To pay or cause to be paid STAR bond project costs, including, specifically, to reimburse any developer or nongovernmental person for STAR bond project costs incurred by that person. A political subdivision is not required to obtain any right, title, or interest in any real or personal property in order to pay STAR bond project costs associated with the property. The political subdivision shall adopt accounting procedures necessary to determine that the STAR bond project costs are properly paid.

(k) To exercise any and all other powers necessary to effectuate the purposes of this Act.

Section 65. The Illinois State Auditing Act is amended by changing Section 3-1 as follows:

(30 ILCS 5/3-1) (from Ch. 15, par. 303-1)

Sec. 3-1. Jurisdiction of Auditor General. The Auditor General has jurisdiction over all State agencies to make post audits and investigations authorized by or under this Act or the Constitution.

The Auditor General has jurisdiction over local government agencies and private agencies only:

(a) to make such post audits authorized by or under this Act as are necessary and incidental to a post audit of a State agency or of a program administered by a State agency involving public funds of the State, but this jurisdiction does not include any authority to review local governmental agencies in the obligation, receipt, expenditure or use of public funds of the State that are granted without limitation or condition imposed by law, other than the general limitation that such funds be used for public purposes;

(b) to make investigations authorized by or under this Act or the Constitution; and

(c) to make audits of the records of local government agencies to verify actual costs of state-mandated programs when directed to do so by the Legislative Audit Commission at the request of the State Board of Appeals under the State Mandates Act.

In addition to the foregoing, the Auditor General may conduct an audit of the Metropolitan Pier and Exposition Authority, the Regional Transportation Authority, the Suburban Bus Division, the Commuter Rail Division and the Chicago Transit Authority and any other subsidized carrier when authorized by the Legislative Audit Commission. Such audit may be a financial, management or program audit, or any combination thereof.

The audit shall determine whether they are operating in accordance with all applicable laws and regulations. Subject to the limitations of this Act, the Legislative Audit Commission may by resolution specify additional determinations to be included in the scope of the audit.

In addition to the foregoing, the Auditor General must also conduct a financial audit of the Illinois Sports Facilities Authority's expenditures of public funds in connection with the reconstruction, renovation, remodeling, extension, or improvement of all or substantially all of any existing "facility", as that term is defined in the Illinois Sports Facilities Authority Act.

The Auditor General may also conduct an audit, when authorized by the Legislative Audit Commission, of any hospital which receives 10% or more of its gross revenues from payments from the State of Illinois, Department of Healthcare and Family Services (formerly Department of Public Aid), Medical Assistance Program.

The Auditor General is authorized to conduct financial and compliance audits of the Illinois Distance Learning Foundation and the Illinois Conservation Foundation.

As soon as practical after the effective date of this amendatory Act of 1995, the Auditor General shall conduct a compliance and management audit of the City of Chicago and any other entity with regard to the operation of Chicago O'Hare International Airport, Chicago Midway Airport and Merrill C. Meigs Field. The audit shall include, but not be limited to, an examination of revenues, expenses, and transfers of funds; purchasing and contracting policies and practices; staffing levels; and hiring practices and procedures. When completed, the audit required by this paragraph shall be distributed in accordance with Section 3-14.

The Auditor General shall conduct a financial and compliance and program audit of distributions from the Municipal Economic Development Fund during the immediately preceding calendar year pursuant to Section 8-403.1 of the Public Utilities Act at no cost to the city, village, or incorporated town that received the distributions.

The Auditor General must conduct an audit of the Health Facilities and Services Review Board pursuant to Section 19.5 of the Illinois Health Facilities Planning Act.

The Auditor General of the State of Illinois shall annually conduct or cause to be conducted a financial and compliance audit of the books and records of any county water commission organized pursuant to the Water Commission Act of 1985 and shall file a copy of the report of that audit with the Governor and the Legislative Audit Commission. The filed audit shall be open to the public for inspection. The cost of the audit shall be charged to the county water commission in accordance with Section 6z-27 of the State Finance Act. The county water commission shall make available to the Auditor General its books and records and any other documentation, whether in the possession of its trustees or other parties, necessary to conduct the audit required. These audit requirements apply only through July 1, 2007.

The Auditor General must conduct audits of the Rend Lake Conservancy District as provided in Section 25.5 of the River Conservancy Districts Act.

The Auditor General must conduct financial audits of the Southeastern Illinois Economic Development Authority as provided in Section 70 of the Southeastern Illinois Economic Development Authority Act.

The Auditor General shall conduct a compliance audit in accordance with subsections (d) and (f) of Section 30 of the STAR Bonds Financing Act.

(Source: P.A. 95-331, eff. 8-21-07; 96-31, eff. 6-30-09.)

Section 66. The State Finance Act is amended by changing Sections 6z-18 and 6z-20 and by adding Sections 5.756 and 5.757 as follows:

(30 ILCS 105/5.756 new)

Sec. 5.756. The STAR Bonds Revenue Fund.

(30 ILCS 105/5.757 new)

Sec. 5.757. STAR Bonds Community Improvement Trust Fund.

(30 ILCS 105/6z-18) (from Ch. 127, par. 142z-18)

Sec. 6z-18. A portion of the money paid into the Local Government Tax Fund from sales of food for human consumption which is to be consumed off the premises where it is sold (other than alcoholic beverages, soft drinks and food which has been prepared for immediate consumption) and prescription and nonprescription medicines, drugs, medical appliances and insulin, urine testing materials, syringes and needles used by diabetics, which occurred in municipalities, shall be distributed to each municipality based upon the sales which occurred in that municipality. The remainder shall be distributed to each county based upon the sales which occurred in the unincorporated area of that county.

A portion of the money paid into the Local Government Tax Fund from the 6.25% general use tax rate on the selling price of tangible personal property which is purchased outside Illinois at retail from a retailer and which is titled or registered by any agency of this State's government shall be distributed to municipalities as provided in this paragraph. Each municipality shall receive the amount attributable to sales for which Illinois addresses for titling or registration purposes are given as being in such municipality. The remainder of the money paid into the Local Government Tax Fund from such sales shall be distributed to counties. Each county shall receive the amount attributable to sales for which Illinois addresses for titling or registration purposes are given as being located in the unincorporated area of such county.

A portion of the money paid into the Local Government Tax Fund from the 6.25% general rate (and, beginning July 1, 2000 and through December 31, 2000, the 1.25% rate on motor fuel and gasohol) on sales subject to taxation under the Retailers' Occupation Tax Act and the Service Occupation Tax Act, which occurred in municipalities, shall be distributed to each municipality, based upon the sales which occurred in that municipality. The remainder shall be distributed to each county, based upon the sales which occurred in the unincorporated area of such county.

For the purpose of determining allocation to the local government unit, a retail sale by a producer of coal or other mineral mined in Illinois is a sale at retail at the place where the coal or other mineral mined in Illinois is extracted from the earth. This paragraph does not apply to coal or other mineral when it is delivered or shipped by the seller to the purchaser at a point outside Illinois so that the sale is exempt under the United States Constitution as a sale in interstate or foreign commerce.

Whenever the Department determines that a refund of money paid into the Local Government Tax Fund should be made to a claimant instead of issuing a credit memorandum, the Department shall notify the State Comptroller, who shall cause the order to be drawn for the amount specified, and to the person named, in such notification from the Department. Such refund shall be paid by the State Treasurer out of the Local Government Tax Fund.

As soon as possible after the first day of each month, beginning January 1, 2011, upon certification of the Department of Revenue, the Comptroller shall order transferred, and the Treasurer shall transfer to the STAR Bonds Revenue Fund the local sales tax increment, as defined in the STAR Bonds Financing Act, collected during the second preceding calendar month for sales within a STAR bond district and deposited into the Local Government Tax Fund, less 3% of that amount, which shall be transferred into the Tax Compliance and Administration Fund and shall be used by the Department, subject to appropriation, to cover the costs of the Department in administering the STAR Bonds Financing Act.

After the monthly transfer to the STAR Bonds Revenue Fund, on On or before the 25th day of each calendar month, the Department shall prepare and certify to the Comptroller the disbursement of stated sums of money to named municipalities and counties, the municipalities and counties to be those entitled to distribution of taxes or penalties paid to the Department during the second preceding calendar month. The amount to be paid to each municipality or county shall be the amount (not including credit memoranda) collected during the second preceding calendar month by the Department and paid into the Local Government Tax Fund, plus an amount the Department determines is necessary to offset any amounts which were erroneously paid to a different taxing body, and not including an amount equal to the amount of refunds made during the second preceding calendar month by the Department, and not including any amount which the Department determines is necessary to offset any amounts which are payable to a different taxing body but were erroneously paid to the municipality or county, and not including any amounts that are transferred to the STAR Bonds Revenue Fund. Within 10 days after receipt, by the Comptroller, of the disbursement certification to the municipalities and counties, provided for in this Section to be given to the Comptroller by the Department, the Comptroller shall cause the orders to be drawn for the respective amounts in accordance with the directions contained in such certification.

When certifying the amount of monthly disbursement to a municipality or county under this Section, the Department shall increase or decrease that amount by an amount necessary to offset any misallocation of previous disbursements. The offset amount shall be the amount erroneously disbursed within the 6 months preceding the time a misallocation is discovered.

The provisions directing the distributions from the special fund in the State Treasury provided for in this Section shall constitute an irrevocable and continuing appropriation of all amounts as provided herein. The State Treasurer and State Comptroller are hereby authorized to make distributions as provided in this Section.

In construing any development, redevelopment, annexation, preannexation or other lawful agreement in effect prior to September 1, 1990, which describes or refers to receipts from a county or municipal retailers' occupation tax, use tax or service occupation tax which now cannot be imposed, such description or reference shall be deemed to include the replacement revenue for such abolished taxes, distributed from the Local Government Tax Fund.

(Source: P.A. 90-491, eff. 1-1-98; 91-51, eff. 6-30-99; 91-872, eff. 7-1-00.)

(30 ILCS 105/6z-20) (from Ch. 127, par. 142z-20)

Sec. 6z-20. Of the money received from the 6.25% general rate (and, beginning July 1, 2000 and through December 31, 2000, the 1.25% rate on motor fuel and gasohol) on sales subject to taxation under the Retailers' Occupation Tax Act and Service Occupation Tax Act and paid into the County and Mass Transit District Fund, distribution to the Regional Transportation Authority tax fund, created pursuant to Section 4.03 of the Regional Transportation Authority Act, for deposit therein shall be made based upon the retail sales occurring in a county having more than 3,000,000 inhabitants. The remainder shall be distributed to each county having 3,000,000 or fewer inhabitants based upon the retail sales occurring in each such county.

For the purpose of determining allocation to the local government unit, a retail sale by a producer of coal or other mineral mined in Illinois is a sale at retail at the place where the coal or other mineral mined in Illinois is extracted from the earth. This paragraph does not apply to coal or other mineral when it is delivered or shipped by the seller to the purchaser at a point outside Illinois so that the sale is exempt under the United States Constitution as a sale in interstate or foreign commerce.

Of the money received from the 6.25% general use tax rate on tangible personal property which is purchased outside Illinois at retail from a retailer and which is titled or registered by any agency of this State's government and paid into the County and Mass Transit District Fund, the amount for which Illinois addresses for titling or registration purposes are given as being in each county having more than 3,000,000 inhabitants shall be distributed into the Regional Transportation Authority tax fund, created pursuant to Section 4.03 of the Regional Transportation Authority Act. The remainder of the money paid from such sales shall be distributed to each county based on sales for which Illinois addresses for titling or registration purposes are given as being located in the county. Any money paid into the Regional Transportation Authority Occupation and Use Tax Replacement Fund from the County and Mass Transit District Fund prior to January 14, 1991, which has not been paid to the Authority prior to that date, shall be transferred to the Regional Transportation Authority tax fund.

Whenever the Department determines that a refund of money paid into the County and Mass Transit District Fund should be made to a claimant instead of issuing a credit memorandum, the Department shall notify the State Comptroller, who shall cause the order to be drawn for the amount specified, and to the person named, in such notification from the Department. Such refund shall be paid by the State Treasurer out of the County and Mass Transit District Fund.

As soon as possible after the first day of each month, beginning January 1, 2011, upon certification of the Department of Revenue, the Comptroller shall order transferred, and the Treasurer shall transfer, to the STAR Bonds Revenue Fund the State sales tax increment, as defined in the STAR Bonds Financing Act, collected during the second preceding calendar month for sales within a STAR bond district and deposited into the County and Mass Transit District Fund, less 3% of that amount, which shall be transferred into the Tax Compliance and Administration Fund and shall be used by the Department, subject to appropriation, to cover the costs of the Department in administering the STAR Bonds Financing Act.

After the monthly transfer to the STAR Bonds Revenue Fund, on On or before the 25th day of each calendar month, the Department shall prepare and certify to the Comptroller the disbursement of stated sums of money to the Regional Transportation Authority and to named counties, the counties to be those entitled to distribution, as hereinabove provided, of taxes or penalties paid to the Department during the second preceding calendar month. The amount to be paid to the Regional Transportation Authority and each county having 3,000,000 or fewer inhabitants shall be the amount (not including credit memoranda) collected during the second preceding calendar month by the Department and paid into the County and Mass Transit District Fund, plus an amount the Department determines is necessary to offset any amounts which were erroneously paid to a different taxing body, and not including an amount equal to the amount of refunds made during the second preceding calendar month by the Department, and not including any amount which the Department determines is necessary to offset any amounts which were payable to a different taxing body but were erroneously paid to the Regional Transportation Authority or county, and not including any amounts that are transferred to the STAR Bonds Revenue Fund. Within 10 days after receipt, by the Comptroller, of the disbursement certification to the Regional Transportation Authority and counties, provided for in this Section to be given to the Comptroller by the Department, the Comptroller shall cause the orders to be drawn for the respective amounts in accordance with the directions contained in such certification.

When certifying the amount of a monthly disbursement to the Regional Transportation Authority or to a county under this Section, the Department shall increase or decrease that amount by an amount necessary to offset any misallocation of previous disbursements. The offset amount shall be the amount erroneously disbursed within the 6 months preceding the time a misallocation is discovered.

The provisions directing the distributions from the special fund in the State Treasury provided for in this Section and from the Regional Transportation Authority tax fund created by Section 4.03 of the Regional Transportation Authority Act shall constitute an irrevocable and continuing appropriation of all amounts as provided herein. The State Treasurer and State Comptroller are hereby authorized to make distributions as provided in this Section.

In construing any development, redevelopment, annexation, preannexation or other lawful agreement in effect prior to September 1, 1990, which describes or refers to receipts from a county or municipal retailers' occupation tax, use tax or service occupation tax which now cannot be imposed, such description or reference shall be deemed to include the replacement revenue for such abolished taxes, distributed from the County and Mass Transit District Fund or Local Government Distributive Fund, as the case may be.

(Source: P.A. 90-491, eff. 1-1-98; 91-872, eff. 7-1-00.)

Section 67. The Counties Code is amended by changing Sections 5-1006, 5-1006.5, 5-1006.7, and 5-1007 as follows:

(55 ILCS 5/5-1006) (from Ch. 34, par. 5-1006)

Sec. 5-1006. Home Rule County Retailers' Occupation Tax Law. Any county that is a home rule unit may impose a tax upon all persons engaged in the business of selling tangible personal property, other than an item of tangible personal property titled or registered with an agency of this State's government, at retail in the county on the gross receipts from such sales made in the course of their business. If imposed, this tax shall only be imposed in 1/4% increments. On and after September 1, 1991, this additional tax may not be imposed on the sales of food for human consumption which is to be consumed off the premises where it is sold (other than alcoholic beverages, soft drinks and food which has been prepared for immediate consumption) and prescription and nonprescription medicines, drugs, medical appliances and insulin, urine testing materials, syringes and needles used by diabetics. The tax imposed by a home rule county pursuant to this Section and all civil penalties that may be assessed as an incident thereof shall be collected and enforced by the State Department of Revenue. The certificate of registration that is issued by the Department to a retailer under the Retailers' Occupation Tax Act shall permit the retailer to engage in a business that is taxable under any ordinance or resolution enacted pursuant to this Section without registering separately with the Department under such ordinance or resolution or under this Section. The Department shall have full power to administer and enforce this Section; to collect all taxes and penalties due hereunder; to dispose of taxes and penalties so collected in the manner hereinafter provided; and to determine all rights to credit memoranda arising on account of the erroneous payment of tax or penalty hereunder. In the administration of, and compliance with, this Section, the Department and persons who are subject to this Section shall have the same rights, remedies, privileges, immunities, powers and duties, and be subject to the same conditions, restrictions, limitations, penalties and definitions of terms, and employ the same modes of procedure, as are prescribed in Sections 1, 1a, 1a-1, 1d, 1e, 1f, 1i, 1j, 1k, 1m, 1n, 2 through 2-65 (in respect to all provisions therein other than the State rate of tax), 4, 5, 5a, 5b, 5c, 5d, 5e, 5f, 5g, 5h, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 7, 8, 9, 10, 11, 12 and 13 of the Retailers' Occupation Tax Act and Section 3-7 of the Uniform Penalty and Interest Act, as fully as if those provisions were set forth herein.

No tax may be imposed by a home rule county pursuant to this Section unless the county also imposes a tax at the same rate pursuant to Section 5-1007.

Persons subject to any tax imposed pursuant to the authority granted in this Section may reimburse themselves for their seller's tax liability hereunder by separately stating such tax as an additional charge, which charge may be stated in combination, in a single amount, with State tax which sellers are required to collect under the Use Tax Act, pursuant to such bracket schedules as the Department may prescribe.

Whenever the Department determines that a refund should be made under this Section to a claimant instead of issuing a credit memorandum, the Department shall notify the State Comptroller, who shall cause the order to be drawn for the amount specified and to the person named in the notification from the Department. The refund shall be paid by the State Treasurer out of the home rule county retailers' occupation tax fund.

The Department shall forthwith pay over to the State Treasurer, ex officio, as trustee, all taxes and penalties collected hereunder.

As soon as possible after the first day of each month, beginning January 1, 2011, upon certification of the Department of Revenue, the Comptroller shall order transferred, and the Treasurer shall transfer, to the STAR Bonds Revenue Fund the local sales tax increment, as defined in the STAR Bonds Financing Act, collected under this Section during the second preceding calendar month for sales within a STAR bond district.

After the monthly transfer to the STAR Bonds Revenue Fund, on On or before the 25th day of each calendar month, the Department shall prepare and certify to the Comptroller the disbursement of stated sums of money to named counties, the counties to be those from which retailers have paid taxes or penalties hereunder to the Department during the second preceding calendar month. The amount to be paid to each county shall be the amount (not including credit memoranda) collected hereunder during the second preceding calendar month by the Department plus an amount the Department determines is necessary to offset any amounts that were erroneously paid to a different taxing body, and not including an amount equal to the amount of refunds made during the second preceding calendar month by the Department on behalf of such county, and not including any amount which the Department determines is necessary to offset any amounts which were payable to a different taxing body but were erroneously paid to the county, and not including any amounts that are transferred to the STAR Bonds Revenue Fund. Within 10 days after receipt, by the Comptroller, of the disbursement certification to the counties provided for in this Section to be given to the Comptroller by the Department, the Comptroller shall cause the orders to be drawn for the respective amounts in accordance with the directions contained in the certification.

In addition to the disbursement required by the preceding paragraph, an allocation shall be made in March of each year to each county that received more than $500,000 in disbursements under the preceding paragraph in the preceding calendar year. The allocation shall be in an amount equal to the average monthly distribution made to each such county under the preceding paragraph during the preceding calendar year (excluding the 2 months of highest receipts). The distribution made in March of each year subsequent to the year in which an allocation was made pursuant to this paragraph and the preceding paragraph shall be reduced by the amount allocated and disbursed under this paragraph in the preceding calendar year. The Department shall prepare and certify to the Comptroller for disbursement the allocations made in accordance with this paragraph.

For the purpose of determining the local governmental unit whose tax is applicable, a retail sale by a producer of coal or other mineral mined in Illinois is a sale at retail at the place where the coal or other mineral mined in Illinois is extracted from the earth. This paragraph does not apply to coal or other mineral when it is delivered or shipped by the seller to the purchaser at a point outside Illinois so that the sale is exempt under the United States Constitution as a sale in interstate or foreign commerce.

Nothing in this Section shall be construed to authorize a county to impose a tax upon the privilege of engaging in any business which under the Constitution of the United States may not be made the subject of taxation by this State.

An ordinance or resolution imposing or discontinuing a tax hereunder or effecting a change in the rate thereof shall be adopted and a certified copy thereof filed with the Department on or before the first day of June, whereupon the Department shall proceed to administer and enforce this Section as of the first day of September next following such adoption and filing. Beginning January 1, 1992, an ordinance or resolution imposing or discontinuing the tax hereunder or effecting a change in the rate thereof shall be adopted and a certified copy thereof filed with the Department on or before the first day of July, whereupon the Department shall proceed to administer and enforce this Section as of the first day of October next following such adoption and filing. Beginning January 1, 1993, an ordinance or resolution imposing or discontinuing the tax hereunder or effecting a change in the rate thereof shall be adopted and a certified copy thereof filed with the Department on or before the first day of October, whereupon the Department shall proceed to administer and enforce this Section as of the first day of January next following such adoption and filing. Beginning April 1, 1998, an ordinance or resolution imposing or discontinuing the tax hereunder or effecting a change in the rate thereof shall either (i) be adopted and a certified copy thereof filed with the Department on or before the first day of April, whereupon the Department shall proceed to administer and enforce this Section as of the first day of July next following the adoption and filing; or (ii) be adopted and a certified copy thereof filed with the Department on or before the first day of October, whereupon the Department shall proceed to administer and enforce this Section as of the first day of January next following the adoption and filing.

When certifying the amount of a monthly disbursement to a county under this Section, the Department shall increase or decrease such amount by an amount necessary to offset any misallocation of previous disbursements. The offset amount shall be the amount erroneously disbursed within the previous 6 months from the time a misallocation is discovered.

This Section shall be known and may be cited as the Home Rule County Retailers' Occupation Tax Law.

(Source: P.A. 90-689, eff. 7-31-98; 91-51, eff. 6-30-99.)

(55 ILCS 5/5-1006.5)

(Text of Section before amendment by P.A. 96-845)

Sec. 5-1006.5. Special County Retailers' Occupation Tax For Public Safety, Public Facilities, or Transportation.

(a) The county board of any county may impose a tax upon all persons engaged in the business of selling tangible personal property, other than personal property titled or registered with an agency of this State's government, at retail in the county on the gross receipts from the sales made in the course of business to provide revenue to be used exclusively for public safety, public facility, or transportation purposes in that county, if a proposition for the tax has been submitted to the electors of that county and approved by a majority of those voting on the question. If imposed, this tax shall be imposed only in one-quarter percent increments. By resolution, the county board may order the proposition to be submitted at any election. If the tax is imposed for transportation purposes for expenditures for public highways or as authorized under the Illinois Highway Code, the county board must publish notice of the existence of its long-range highway transportation plan as required or described in Section 5-301 of the Illinois Highway Code and must make the plan publicly available prior to approval of the ordinance or resolution imposing the tax. If the tax is imposed for transportation purposes for expenditures for passenger rail transportation, the county board must publish notice of the existence of its long-range passenger rail transportation plan and must make the plan publicly available prior to approval of the ordinance or resolution imposing the tax.

If a tax is imposed for public facilities purposes, then the name of the project may be included in the proposition at the discretion of the county board as determined in the enabling resolution. For example, the "XXX Nursing Home" or the "YYY Museum".

The county clerk shall certify the question to the proper election authority, who shall submit the proposition at an election in accordance with the general election law.

(1) The proposition for public safety purposes shall be in substantially the following form:

"To pay for public safety purposes, shall (name of county) be authorized to impose an increase on its share of local sales taxes by (insert rate)?"

As additional information on the ballot below the question shall appear the following:

"This would mean that a consumer would pay an additional (insert amount) in sales tax for every $100 of tangible personal property bought at retail."

The county board may also opt to establish a sunset provision at which time the additional sales tax would cease being collected, if not terminated earlier by a vote of the county board. If the county board votes to include a sunset provision, the proposition for public safety purposes shall be in substantially the following form:

"To pay for public safety purposes, shall (name of county) be authorized to impose an increase on its share of local sales taxes by (insert rate) for a period not to exceed (insert number of years)?"

As additional information on the ballot below the question shall appear the following:

"This would mean that a consumer would pay an additional (insert amount) in sales tax for every $100 of tangible personal property bought at retail. If imposed, the additional tax would cease being collected at the end of (insert number of years), if not terminated earlier by a vote of the county board."

For the purposes of the paragraph, "public safety purposes" means crime prevention, detention, fire fighting, police, medical, ambulance, or other emergency services.

Votes shall be recorded as "Yes" or "No".

(2) The proposition for transportation purposes shall be in substantially the following form:

"To pay for improvements to roads and other transportation purposes, shall (name of county) be authorized to impose an increase on its share of local sales taxes by (insert rate)?"

As additional information on the ballot below the question shall appear the following:

"This would mean that a consumer would pay an additional (insert amount) in sales tax for every $100 of tangible personal property bought at retail."

The county board may also opt to establish a sunset provision at which time the additional sales tax would cease being collected, if not terminated earlier by a vote of the county board. If the county board votes to include a sunset provision, the proposition for transportation purposes shall be in substantially the following form:

"To pay for road improvements and other transportation purposes, shall (name of county) be authorized to impose an increase on its share of local sales taxes by (insert rate) for a period not to exceed (insert number of years)?"

As additional information on the ballot below the question shall appear the following:

"This would mean that a consumer would pay an additional (insert amount) in sales tax for every $100 of tangible personal property bought at retail. If imposed, the additional tax would cease being collected at the end of (insert number of years), if not terminated earlier by a vote of the county board."

For the purposes of this paragraph, transportation purposes means construction, maintenance, operation, and improvement of public highways, any other purpose for which a county may expend funds under the Illinois Highway Code, and passenger rail transportation.

The votes shall be recorded as "Yes" or "No".

(3) The proposition for public facilities purposes shall be in substantially the following form:

"To pay for public facilities purposes, shall (name of county) be authorized to impose an increase on its share of local sales taxes by (insert rate)?"

As additional information on the ballot below the question shall appear the following:

"This would mean that a consumer would pay an additional (insert amount) in sales tax for every $100 of tangible personal property bought at retail."

The county board may also opt to establish a sunset provision at which time the additional sales tax would cease being collected, if not terminated earlier by a vote of the county board. If the county board votes to include a sunset provision, the proposition for public facilities purposes shall be in substantially the following form:

"To pay for public facilities purposes, shall (name of county) be authorized to impose an increase on its share of local sales taxes by (insert rate) for a period not to exceed (insert number of years)?"

As additional information on the ballot below the question shall appear the following:

"This would mean that a consumer would pay an additional (insert amount) in sales tax for every $100 of tangible personal property bought at retail. If imposed, the additional tax would cease being collected at the end of (insert number of years), if not terminated earlier by a vote of the county board."

For purposes of this Section, "public facilities purposes" means the acquisition, development, construction, reconstruction, rehabilitation, improvement, financing, architectural planning, and installation of capital facilities consisting of buildings, structures, and durable equipment and for the acquisition and improvement of real property and interest in real property required, or expected to be required, in connection with the public facilities, for use by the county for the furnishing of governmental services to its citizens, including but not limited to museums and nursing homes.

The votes shall be recorded as "Yes" or "No".

If a majority of the electors voting on the proposition vote in favor of it, the county may impose the tax. A county may not submit more than one proposition authorized by this Section to the electors at any one time.

This additional tax may not be imposed on the sales of food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, soft drinks, and food which has been prepared for immediate consumption) and prescription and non-prescription medicines, drugs, medical appliances and insulin, urine testing materials, syringes, and needles used by diabetics. The tax imposed by a county under this Section and all civil penalties that may be assessed as an incident of the tax shall be collected and enforced by the Illinois Department of Revenue and deposited into a special fund created for that purpose. The certificate of registration that is issued by the Department to a retailer under the Retailers' Occupation Tax Act shall permit the retailer to engage in a business that is taxable without registering separately with the Department under an ordinance or resolution under this Section. The Department has full power to administer and enforce this Section, to collect all taxes and penalties due under this Section, to dispose of taxes and penalties so collected in the manner provided in this Section, and to determine all rights to credit memoranda arising on account of the erroneous payment of a tax or penalty under this Section. In the administration of and compliance with this Section, the Department and persons who are subject to this Section shall (i) have the same rights, remedies, privileges, immunities, powers, and duties, (ii) be subject to the same conditions, restrictions, limitations, penalties, and definitions of terms, and (iii) employ the same modes of procedure as are prescribed in Sections 1, 1a, 1a-1, 1d, 1e, 1f, 1i, 1j, 1k, 1m, 1n, 2 through 2-70 (in respect to all provisions contained in those Sections other than the State rate of tax), 2a, 2b, 2c, 3 (except provisions relating to transaction returns and quarter monthly payments), 4, 5, 5a, 5b, 5c, 5d, 5e, 5f, 5g, 5h, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 7, 8, 9, 10, 11, 11a, 12, and 13 of the Retailers' Occupation Tax Act and Section 3-7 of the Uniform Penalty and Interest Act as if those provisions were set forth in this Section.

Persons subject to any tax imposed under the authority granted in this Section may reimburse themselves for their sellers' tax liability by separately stating the tax as an additional charge, which charge may be stated in combination, in a single amount, with State tax which sellers are required to collect under the Use Tax Act, pursuant to such bracketed schedules as the Department may prescribe.

Whenever the Department determines that a refund should be made under this Section to a claimant instead of issuing a credit memorandum, the Department shall notify the State Comptroller, who shall cause the order to be drawn for the amount specified and to the person named in the notification from the Department. The refund shall be paid by the State Treasurer out of the County Public Safety or Transportation Retailers' Occupation Tax Fund.

(b) If a tax has been imposed under subsection (a), a service occupation tax shall also be imposed at the same rate upon all persons engaged, in the county, in the business of making sales of service, who, as an incident to making those sales of service, transfer tangible personal property within the county as an incident to a sale of service. This tax may not be imposed on sales of food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, soft drinks, and food prepared for immediate consumption) and prescription and non-prescription medicines, drugs, medical appliances and insulin, urine testing materials, syringes, and needles used by diabetics. The tax imposed under this subsection and all civil penalties that may be assessed as an incident thereof shall be collected and enforced by the Department of Revenue. The Department has full power to administer and enforce this subsection; to collect all taxes and penalties due hereunder; to dispose of taxes and penalties so collected in the manner hereinafter provided; and to determine all rights to credit memoranda arising on account of the erroneous payment of tax or penalty hereunder. In the administration of, and compliance with this subsection, the Department and persons who are subject to this paragraph shall (i) have the same rights, remedies, privileges, immunities, powers, and duties, (ii) be subject to the same conditions, restrictions, limitations, penalties, exclusions, exemptions, and definitions of terms, and (iii) employ the same modes of procedure as are prescribed in Sections 2 (except that the reference to State in the definition of supplier maintaining a place of business in this State shall mean the county), 2a, 2b, 2c, 3 through 3-50 (in respect to all provisions therein other than the State rate of tax), 4 (except that the reference to the State shall be to the county), 5, 7, 8 (except that the jurisdiction to which the tax shall be a debt to the extent indicated in that Section 8 shall be the county), 9 (except as to the disposition of taxes and penalties collected), 10, 11, 12 (except the reference therein to Section 2b of the Retailers' Occupation Tax Act), 13 (except that any reference to the State shall mean the county), Section 15, 16, 17, 18, 19 and 20 of the Service Occupation Tax Act and Section 3-7 of the Uniform Penalty and Interest Act, as fully as if those provisions were set forth herein.

Persons subject to any tax imposed under the authority granted in this subsection may reimburse themselves for their serviceman's tax liability by separately stating the tax as an additional charge, which charge may be stated in combination, in a single amount, with State tax that servicemen are authorized to collect under the Service Use Tax Act, in accordance with such bracket schedules as the Department may prescribe.

Whenever the Department determines that a refund should be made under this subsection to a claimant instead of issuing a credit memorandum, the Department shall notify the State Comptroller, who shall cause the warrant to be drawn for the amount specified, and to the person named, in the notification from the Department. The refund shall be paid by the State Treasurer out of the County Public Safety or Transportation Retailers' Occupation Fund.

Nothing in this subsection shall be construed to authorize the county to impose a tax upon the privilege of engaging in any business which under the Constitution of the United States may not be made the subject of taxation by the State.

(c) The Department shall immediately pay over to the State Treasurer, ex officio, as trustee, all taxes and penalties collected under this Section to be deposited into the County Public Safety or Transportation Retailers' Occupation Tax Fund, which shall be an unappropriated trust fund held outside of the State treasury.

As soon as possible after the first day of each month, beginning January 1, 2011, upon certification of the Department of Revenue, the Comptroller shall order transferred, and the Treasurer shall transfer, to the STAR Bonds Revenue Fund the local sales tax increment, as defined in the STAR Bonds Financing Act, collected under this Section during the second preceding calendar month for sales within a STAR bond district.

After the monthly transfer to the STAR Bonds Revenue Fund, on On or before the 25th day of each calendar month, the Department shall prepare and certify to the Comptroller the disbursement of stated sums of money to the counties from which retailers have paid taxes or penalties to the Department during the second preceding calendar month. The amount to be paid to each county, and deposited by the county into its special fund created for the purposes of this Section, shall be the amount (not including credit memoranda) collected under this Section during the second preceding calendar month by the Department plus an amount the Department determines is necessary to offset any amounts that were erroneously paid to a different taxing body, and not including (i) an amount equal to the amount of refunds made during the second preceding calendar month by the Department on behalf of the county, and (ii) any amount that the Department determines is necessary to offset any amounts that were payable to a different taxing body but were erroneously paid to the county, and (iii) any amounts that are transferred to the STAR Bonds Revenue Fund. Within 10 days after receipt by the Comptroller of the disbursement certification to the counties provided for in this Section to be given to the Comptroller by the Department, the Comptroller shall cause the orders to be drawn for the respective amounts in accordance with directions contained in the certification.

In addition to the disbursement required by the preceding paragraph, an allocation shall be made in March of each year to each county that received more than $500,000 in disbursements under the preceding paragraph in the preceding calendar year. The allocation shall be in an amount equal to the average monthly distribution made to each such county under the preceding paragraph during the preceding calendar year (excluding the 2 months of highest receipts). The distribution made in March of each year subsequent to the year in which an allocation was made pursuant to this paragraph and the preceding paragraph shall be reduced by the amount allocated and disbursed under this paragraph in the preceding calendar year. The Department shall prepare and certify to the Comptroller for disbursement the allocations made in accordance with this paragraph.

(d) For the purpose of determining the local governmental unit whose tax is applicable, a retail sale by a producer of coal or another mineral mined in Illinois is a sale at retail at the place where the coal or other mineral mined in Illinois is extracted from the earth. This paragraph does not apply to coal or another mineral when it is delivered or shipped by the seller to the purchaser at a point outside Illinois so that the sale is exempt under the United States Constitution as a sale in interstate or foreign commerce.

(e) Nothing in this Section shall be construed to authorize a county to impose a tax upon the privilege of engaging in any business that under the Constitution of the United States may not be made the subject of taxation by this State.

(e-5) If a county imposes a tax under this Section, the county board may, by ordinance, discontinue or lower the rate of the tax. If the county board lowers the tax rate or discontinues the tax, a referendum must be held in accordance with subsection (a) of this Section in order to increase the rate of the tax or to reimpose the discontinued tax.

(f) Beginning April 1, 1998, the results of any election authorizing a proposition to impose a tax under this Section or effecting a change in the rate of tax, or any ordinance lowering the rate or discontinuing the tax, shall be certified by the county clerk and filed with the Illinois Department of Revenue either (i) on or before the first day of April, whereupon the Department shall proceed to administer and enforce the tax as of the first day of July next following the filing; or (ii) on or before the first day of October, whereupon the Department shall proceed to administer and enforce the tax as of the first day of January next following the filing.

(g) When certifying the amount of a monthly disbursement to a county under this Section, the Department shall increase or decrease the amounts by an amount necessary to offset any miscalculation of previous disbursements. The offset amount shall be the amount erroneously disbursed within the previous 6 months from the time a miscalculation is discovered.

(h) This Section may be cited as the "Special County Occupation Tax For Public Safety, Public Facilities, or Transportation Law".

(i) For purposes of this Section, "public safety" includes, but is not limited to, crime prevention, detention, fire fighting, police, medical, ambulance, or other emergency services. The county may share tax proceeds received under this Section for public safety purposes, including proceeds received before August 4, 2009 (the effective date of Public Act 96-124) this amendatory Act of the 96th General Assembly, with any fire protection district located in the county. For the purposes of this Section, "transportation" includes, but is not limited to, the construction, maintenance, operation, and improvement of public highways, any other purpose for which a county may expend funds under the Illinois Highway Code, and passenger rail transportation. For the purposes of this Section, "public facilities purposes" includes, but is not limited to, the acquisition, development, construction, reconstruction, rehabilitation, improvement, financing, architectural planning, and installation of capital facilities consisting of buildings, structures, and durable equipment and for the acquisition and improvement of real property and interest in real property required, or expected to be required, in connection with the public facilities, for use by the county for the furnishing of governmental services to its citizens, including but not limited to museums and nursing homes.

(j) The Department may promulgate rules to implement Public Act 95-1002 this amendatory Act of the 95th General Assembly only to the extent necessary to apply the existing rules for the Special County Retailers' Occupation Tax for Public Safety to this new purpose for public facilities.

(Source: P.A. 95-474, eff. 1-1-08; 95-1002, eff. 11-20-08; 96-124, eff. 8-4-09; 96-622, eff. 8-24-09; revised 11-3-09.)

(Text of Section after amendment by P.A. 96-845)

Sec. 5-1006.5. Special County Retailers' Occupation Tax For Public Safety, Public Facilities, or Transportation.

(a) The county board of any county may impose a tax upon all persons engaged in the business of selling tangible personal property, other than personal property titled or registered with an agency of this State's government, at retail in the county on the gross receipts from the sales made in the course of business to provide revenue to be used exclusively for public safety, public facility, or transportation purposes in that county, if a proposition for the tax has been submitted to the electors of that county and approved by a majority of those voting on the question. If imposed, this tax shall be imposed only in one-quarter percent increments. By resolution, the county board may order the proposition to be submitted at any election. If the tax is imposed for transportation purposes for expenditures for public highways or as authorized under the Illinois Highway Code, the county board must publish notice of the existence of its long-range highway transportation plan as required or described in Section 5-301 of the Illinois Highway Code and must make the plan publicly available prior to approval of the ordinance or resolution imposing the tax. If the tax is imposed for transportation purposes for expenditures for passenger rail transportation, the county board must publish notice of the existence of its long-range passenger rail transportation plan and must make the plan publicly available prior to approval of the ordinance or resolution imposing the tax.

If a tax is imposed for public facilities purposes, then the name of the project may be included in the proposition at the discretion of the county board as determined in the enabling resolution. For example, the "XXX Nursing Home" or the "YYY Museum".

The county clerk shall certify the question to the proper election authority, who shall submit the proposition at an election in accordance with the general election law.

(1) The proposition for public safety purposes shall be in substantially the following form:

"To pay for public safety purpo