97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB1089

 

Introduced 02/04/11, by Rep. Thomas Holbrook

 

SYNOPSIS AS INTRODUCED:
 
New Act
35 ILCS 5/221 new

    Creates the Efficient and Green Illinois Tax Credit Act. Authorizes the Department of Commerce and Economic Opportunity to award income tax credits based on 25% of the cost of qualifying expenditures for energy efficient projects, such as solar energy equipment, Energy Star certified heat pumps, lighting retrofit projects, and wind equipment. Authorizes the Department to adopt rules. Provides that the credit may be carried forward for up to 5 taxable years. Amends the Illinois Income Tax Act to make conforming changes. Provides that the credit is exempt from the Act's automatic sunset provisions. Effective immediately.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

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1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the
5Efficient and Green Illinois Tax Credit Act.
 
6    Section 5. Purpose. The General Assembly finds that the
7Illinois economy and environment are greatly enhanced by the
8installation of energy efficiency measures and by the support
9of renewable energy resources. The purpose of this Act is to
10expand the adoption of energy efficiency measures in the
11private sector, as well as to encourage use of renewable energy
12resources. It is the policy of this State to promote and
13encourage the adoption of energy efficiency measures as well as
14the voluntary use of renewable energy resources.
 
15    Section 10. Definitions. As used in this Act:
16    "Energy efficiency project" includes any of the following:
17            (A) Solar energy equipment that uses solar
18        radiation as a substitute for traditional energy for
19        water heating, active space heating and cooling,
20        passive heating, day-lighting, generating electricity,
21        distillation, desalinization, or the production of
22        industrial or commercial process heat, as well as

 

 

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1        related devices necessary for collecting, storing,
2        exchanging, conditioning, or converting solar energy
3        to other useful forms of energy.
4            (B) Energy Star certified geothermal heat pump
5        systems.
6            (C) Lighting retrofit projects. "Lighting retrofit
7        project" means a lighting retrofit system that employs
8        dual switching (ability to switch roughly half the
9        lights off and still have fairly uniform light
10        distribution), de-lamping, day-lighting, re-lamping,
11        or other controls or processes that reduce annual
12        energy and power consumption by 30% compared to the
13        American Society of Heating, Refrigerating, and Air
14        Conditioning Engineers 2004 standard (ASHRAE
15        90.1.2004).
16            (D) Wind equipment required to capture and convert
17        wind energy into electricity or mechanical power as
18        well as related devices that may be required for
19        converting, conditioning, and storing the electricity
20        produced by wind equipment.
21    "Cost" means:
22            (A) In the case of clean energy property owned by
23        the taxpayer, cost is the aggregate funds actually
24        invested and expended by a taxpayer in that taxable
25        year to put into service the clean energy property.
26            (B) In the case of clean energy property the

 

 

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1        taxpayer leases from another, cost is 8 times the net
2        annual rental rate, which is the annual rental rate
3        paid by the taxpayer less any annual rental rate
4        received by the taxpayer from sub-rentals.
5    "Credit" means:
6            (A) For an energy efficiency project approved by
7        the Department, the amount equal to 25% of the cost of
8        that project.
9            (B) For renewable energy resources usage approved
10        by the Department, an amount equal to 25% of the cost
11        paid for the environmental attributes of those
12        renewable energy resources during the tax year.
13    "Department" means the Department of Commerce and Economic
14Opportunity.
15    "Renewable energy resources" means the same as it does in
16Section 1-10 of the Illinois Power Agency Act.
 
17    Section 15. Powers of the Department. The Department, in
18addition to those powers granted under the Civil Administrative
19Code of Illinois, is granted and has all the powers necessary
20or convenient to carry out and effectuate the purposes and
21provisions of this Act, including, but not limited to, power
22and authority to:
23        (1) Adopt rules deemed necessary and appropriate for
24    the administration of the tax credit program; establish
25    forms for applications, notifications, contracts, or any

 

 

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1    other agreements; and accept applications at any time
2    during the year.
3        (2) Assist applicants pursuant to the provisions of
4    this Act to promote, foster, and support energy efficiency
5    measures and renewable energy resources and related job
6    creation or retention within the State.
7        (3) Provide for sufficient personnel to permit
8    administration, staffing, operation, and related support
9    required to adequately discharge its duties and
10    responsibilities described in this Act from funds as may be
11    appropriated to the Department for the administration of
12    this Act.
13        (4) Require that an applicant must at all times keep
14    proper books of record and account in accordance with
15    generally accepted accounting principles consistently
16    applied, with the books, records, or papers related to the
17    accredited production in the custody or control of the
18    taxpayer open for reasonable Department inspection and
19    audits.
 
20    Section 20. Tax credit awards. Subject to the conditions
21set forth in this Act, for taxable years beginning on or after
22January 1, 2011, an applicant is entitled to a credit against
23the tax imposed under subsections (a) and (b) of Section 201 of
24the Illinois Income Tax Act, in an amount approved by the
25Department under Section 40 of this Act.
 

 

 

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1    Section 35. Issuance of tax credit certificate.
2    (a) In order to qualify for a tax credit under this Act, an
3applicant must file an application, on forms prescribed by the
4Department, providing information necessary to calculate the
5tax credit, and any additional information as required by the
6Department.
7    (b) Upon satisfactory review of the application, the
8Department shall issue a tax credit certificate.
 
9    Section 40. Amount and duration of the credit. The amount
10of the credit awarded under this Act is based on the cost of
11the qualifying expenditures under this Act. The credit shall be
12awarded for the taxable year in which the expenditure is made.
13The tax credit may not reduce the taxpayer's liability to less
14than zero. If the amount of the tax credit exceeds the
15taxpayer's Illinois income tax liability for the year, the
16excess may be carried forward and applied to the tax liability
17of the 5 taxable years following the excess credit year. The
18credit must be applied to the earliest year for which there is
19a tax liability. If there are credits from more than one tax
20year that are available to offset a liability, then the earlier
21credit must be applied first. This Act is exempt from the
22provisions of Section 250 of the Illinois Income Tax Act.
 
23    Section 80. The Illinois Income Tax Act is amended by

 

 

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1adding Section 221 as follows:
 
2    (35 ILCS 5/221 new)
3    Sec. 221. Efficient and Green Illinois Tax Credit Act. For
4tax years beginning on or after January 1, 2011, a taxpayer who
5has been awarded a credit under the Efficient and Green
6Illinois Tax Credit Act is entitled to a credit against the
7taxes imposed under subsections (a) and (b) of Section 201 of
8this Act in an amount to be determined under that Act. If the
9taxpayer is a partnership or Subchapter S corporation, the
10credit shall be allowed to the partners or shareholders in
11accordance with the determination of income and distributive
12share of income under Sections 702 and 704 and subchapter S of
13the Internal Revenue Code. This Section is exempt from the
14provisions of Section 250 of this Act.
 
15    Section 99. Effective date. This Act takes effect upon
16becoming law.