97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB5834

 

Introduced 2/16/2012, by Rep. Richard Morthland

 

SYNOPSIS AS INTRODUCED:
 
20 ILCS 655/5.3  from Ch. 67 1/2, par. 608
35 ILCS 120/1f  from Ch. 120, par. 440f
220 ILCS 5/9-222.1  from Ch. 111 2/3, par. 9-222.1

    Amends the Illinois Enterprise Zone Act. Provides that an Enterprise Zone shall be extended for an additional 20 years upon application by the corporate authorities of the county or municipality that designated the Enterprise Zone. Amends the Retailers' Occupation Tax Act. Provides that exemptions granted under the Act for tangible personal property used or consumed in an Enterprise Zone may be in effect for not more than the term of the enterprise zone. Amends the Public Utilities Act and the Retailers' Occupation Tax Act to make conforming changes in provisions concerning tax exemptions for businesses located in Enterprise Zones. Effective immediately.


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FISCAL NOTE ACT MAY APPLY
HOUSING AFFORDABILITY IMPACT 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 5. The Illinois Enterprise Zone Act is amended by
5changing Section 5.3 as follows:
 
6    (20 ILCS 655/5.3)  (from Ch. 67 1/2, par. 608)
7    Sec. 5.3. Certification of Enterprise Zones; Effective
8date.
9    (a) Approval of designated Enterprise Zones shall be made
10by the Department by certification of the designating
11ordinance. The Department shall promptly issue a certificate
12for each Enterprise Zone upon its approval. The certificate
13shall be signed by the Director of the Department, shall make
14specific reference to the designating ordinance, which shall be
15attached thereto, and shall be filed in the office of the
16Secretary of State. A certified copy of the Enterprise Zone
17Certificate, or a duplicate original thereof, shall be recorded
18in the office of recorder of deeds of the county in which the
19Enterprise Zone lies.
20    (b) An Enterprise Zone shall be effective upon its
21certification. The Department shall transmit a copy of the
22certification to the Department of Revenue, and to the
23designating municipality or county.

 

 

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1    Upon certification of an Enterprise Zone, the terms and
2provisions of the designating ordinance shall be in effect, and
3may not be amended or repealed except in accordance with
4Section 5.4.
5    (c) An Enterprise Zone shall be in effect for 30 calendar
6years, or for a lesser number of years specified in the
7certified designating ordinance. Enterprise Zones shall
8terminate at midnight of December 31 of the final calendar year
9of the certified term, except as provided in Section 5.4. The
10Department shall grant, upon application by the corporate
11authorities of the county or municipality that adopted the
12ordinance designating the Enterprise Zone, a one-time
13extension of 20 additional calendar years for each Zone.
14    (d) No more than 12 Enterprise Zones may be certified by
15the Department in calendar year 1984, no more than 12
16Enterprise Zones may be certified by the Department in calendar
17year 1985, no more than 13 Enterprise Zones may be certified by
18the Department in calendar year 1986, no more than 15
19Enterprise Zones may be certified by the Department in calendar
20year 1987, and no more than 20 Enterprise Zones may be
21certified by the Department in calendar year 1990. In other
22calendar years, no more than 13 Enterprise Zones may be
23certified by the Department. The Department may also designate
24up to 8 additional Enterprise Zones outside the regular
25application cycle if warranted by the extreme economic
26circumstances as determined by the Department. The Department

 

 

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1may also designate one additional Enterprise Zone outside the
2regular application cycle if an aircraft manufacturer agrees to
3locate an aircraft manufacturing facility in the proposed
4Enterprise Zone. Notwithstanding any other provision of this
5Act, no more than 89 Enterprise Zones may be certified by the
6Department for the 10 calendar years commencing with 1983. The
77 additional Enterprise Zones authorized by Public Act 86-15
8shall not lie within municipalities or unincorporated areas of
9counties that abut or are contiguous to Enterprise Zones
10certified pursuant to this Section prior to June 30, 1989. The
117 additional Enterprise Zones (excluding the additional
12Enterprise Zone which may be designated outside the regular
13application cycle) authorized by Public Act 86-1030 shall not
14lie within municipalities or unincorporated areas of counties
15that abut or are contiguous to Enterprise Zones certified
16pursuant to this Section prior to February 28, 1990. Beginning
17in calendar year 2004 and until December 31, 2008, one
18additional enterprise zone may be certified by the Department.
19In any calendar year, the Department may not certify more than
203 Zones located within the same municipality. The Department
21may certify Enterprise Zones in each of the 10 calendar years
22commencing with 1983. The Department may not certify more than
23a total of 18 Enterprise Zones located within the same county
24(whether within municipalities or within unincorporated
25territory) for the 10 calendar years commencing with 1983.
26Thereafter, the Department may not certify any additional

 

 

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1Enterprise Zones, but may amend and rescind certifications of
2existing Enterprise Zones in accordance with Section 5.4.
3    (e) Notwithstanding any other provision of law, if (i) the
4county board of any county in which a current military base is
5located, in part or in whole, or in which a military base that
6has been closed within 20 years of the effective date of this
7amendatory Act of 1998 is located, in part or in whole, adopts
8a designating ordinance in accordance with Section 5 of this
9Act to designate the military base in that county as an
10enterprise zone and (ii) the property otherwise meets the
11qualifications for an enterprise zone as prescribed in Section
124 of this Act, then the Department may certify the designating
13ordinance or ordinances, as the case may be.
14(Source: P.A. 92-16, eff. 6-28-01; 92-777, eff. 1-1-03; 93-436,
15eff. 1-1-04.)
 
16    Section 15. The Retailers' Occupation Tax Act is amended by
17changing Section 1f as follows:
 
18    (35 ILCS 120/1f)  (from Ch. 120, par. 440f)
19    Sec. 1f. Except for High Impact Businesses, the exemption
20stated in Sections 1d and 1e of this Act shall only apply to
21business enterprises which:
22        (1) either (i) make investments which cause the
23    creation of a minimum of 200 full-time equivalent jobs in
24    Illinois or (ii) make investments which cause the retention

 

 

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1    of a minimum of 2000 full-time jobs in Illinois or (iii)
2    make investments of a minimum of $40,000,000 and retain at
3    least 90% of the jobs in place on the date on which the
4    exemption is granted and for the duration of the exemption;
5    and
6        (2) are located in an Enterprise Zone established
7    pursuant to the Illinois Enterprise Zone Act; and
8        (3) are certified by the Department of Commerce and
9    Economic Opportunity as complying with the requirements
10    specified in clauses (1), (2) and (3).
11    Any business enterprise seeking to avail itself of the
12exemptions stated in Sections 1d or 1e, or both, shall make
13application to the Department of Commerce and Economic
14Opportunity in such form and providing such information as may
15be prescribed by the Department of Commerce and Economic
16Opportunity. However, no business enterprise shall be
17required, as a condition for certification under clause (4) of
18this Section, to attest that its decision to invest under
19clause (1) of this Section and to locate under clause (2) of
20this Section is predicated upon the availability of the
21exemptions authorized by Sections 1d or 1e.
22    The Department of Commerce and Economic Opportunity shall
23determine whether the business enterprise meets the criteria
24prescribed in this Section. If the Department of Commerce and
25Economic Opportunity determines that such business enterprise
26meets the criteria, it shall issue a certificate of eligibility

 

 

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1for exemption to the business enterprise in such form as is
2prescribed by the Department of Revenue. The Department of
3Commerce and Economic Opportunity shall act upon such
4certification requests within 60 days after receipt of the
5application, and shall file with the Department of Revenue a
6copy of each certificate of eligibility for exemption.
7    The Department of Commerce and Economic Opportunity shall
8have the power to promulgate rules and regulations to carry out
9the provisions of this Section including the power to define
10the amounts and types of eligible investments not specified in
11this Section which business enterprises must make in order to
12receive the exemptions stated in Sections 1d and 1e of this
13Act; and to require that any business enterprise that is
14granted a tax exemption repay the exempted tax if the business
15enterprise fails to comply with the terms and conditions of the
16certification.
17    Such certificate of eligibility for exemption shall be
18presented by the business enterprise to its supplier when
19making the initial purchase of tangible personal property for
20which an exemption is granted by Section 1d or Section 1e, or
21both, together with a certification by the business enterprise
22that such tangible personal property is exempt from taxation
23under Section 1d or Section 1e and by indicating the exempt
24status of each subsequent purchase on the face of the purchase
25order.
26    The Department of Commerce and Economic Opportunity shall

 

 

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1determine the period during which such exemption from the taxes
2imposed under this Act is in effect which shall not exceed 50
320 years or the certified term of the enterprise zone
4(including any extensions granted under subsection (c) of
5Section 5.3 of the Illinois Enterprise Zone Act), whichever
6period is shorter.
7(Source: P.A. 94-793, eff. 5-19-06.)
 
8    Section 25. The Public Utilities Act is amended by changing
9Section 9-222.1 as follows:
 
10    (220 ILCS 5/9-222.1)  (from Ch. 111 2/3, par. 9-222.1)
11    Sec. 9-222.1. A business enterprise which is located within
12an area designated by a county or municipality as an enterprise
13zone pursuant to the Illinois Enterprise Zone Act or located in
14a federally designated Foreign Trade Zone or Sub-Zone shall be
15exempt from the additional charges added to the business
16enterprise's utility bills as a pass-on of municipal and State
17utility taxes under Sections 9-221 and 9-222 of this Act, to
18the extent such charges are exempted by ordinance adopted in
19accordance with paragraph (e) of Section 8-11-2 of the Illinois
20Municipal Code in the case of municipal utility taxes, and to
21the extent such charges are exempted by the percentage
22specified by the Department of Commerce and Economic
23Opportunity in the case of State utility taxes, provided such
24business enterprise meets the following criteria:

 

 

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1        (1) it (i) makes investments which cause the creation
2    of a minimum of 200 full-time equivalent jobs in Illinois;
3    (ii) makes investments of at least $175,000,000 which cause
4    the creation of a minimum of 150 full-time equivalent jobs
5    in Illinois; (iii) makes investments that cause the
6    retention of a minimum of 300 full-time equivalent jobs in
7    the manufacturing sector, as defined by the North American
8    Industry Classification System, in an area in Illinois in
9    which the unemployment rate is above 9% and makes an
10    application to the Department within 3 months after the
11    effective date of this amendatory Act of the 96th General
12    Assembly and certifies relocation of the 300 full-time
13    equivalent jobs within 36 months after the application;
14    (iv) makes investments which cause the retention of a
15    minimum of 1,000 full-time jobs in Illinois; or (v) makes
16    an application to the Department within 2 months after the
17    effective date of this amendatory Act of the 96th General
18    Assembly and makes investments that cause the retention of
19    a minimum of 500 full-time equivalent jobs in 2009 and
20    2010, 675 full-time jobs in Illinois in 2011, 850 full-time
21    jobs in 2012, and 1,000 full-time jobs in 2013, in the
22    manufacturing sector as defined by the North American
23    Industry Classification System; and
24        (2) it is either (i) located in an Enterprise Zone
25    established pursuant to the Illinois Enterprise Zone Act or
26    (ii) located in a federally designated Foreign Trade Zone

 

 

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1    or Sub-Zone and is designated a High Impact Business by the
2    Department of Commerce and Economic Opportunity; and
3        (3) it is certified by the Department of Commerce and
4    Economic Opportunity as complying with the requirements
5    specified in clauses (1) and (2) of this Section.
6    The Department of Commerce and Economic Opportunity shall
7determine the period during which such exemption from the
8charges imposed under Section 9-222 is in effect which shall
9not exceed 50 30 years or the certified term of the enterprise
10zone (including any extensions granted under subsection (c) of
11Section 5.3 of the Illinois Enterprise Zone Act), whichever
12period is shorter, except that the exemption period for a
13business enterprise qualifying under item (iii) of clause (1)
14of this Section shall not exceed 50 30 years.
15    The Department of Commerce and Economic Opportunity shall
16have the power to promulgate rules and regulations to carry out
17the provisions of this Section including procedures for
18complying with the requirements specified in clauses (1) and
19(2) of this Section and procedures for applying for the
20exemptions authorized under this Section; to define the amounts
21and types of eligible investments which business enterprises
22must make in order to receive State utility tax exemptions
23pursuant to Sections 9-222 and 9-222.1 of this Act; to approve
24such utility tax exemptions for business enterprises whose
25investments are not yet placed in service; and to require that
26business enterprises granted tax exemptions repay the exempted

 

 

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1tax should the business enterprise fail to comply with the
2terms and conditions of the certification. However, no business
3enterprise shall be required, as a condition for certification
4under clause (3) of this Section, to attest that its decision
5to invest under clause (1) of this Section and to locate under
6clause (2) of this Section is predicated upon the availability
7of the exemptions authorized by this Section.
8    A business enterprise shall be exempt, in whole or in part,
9from the pass-on charges of municipal utility taxes imposed
10under Section 9-221, only if it meets the criteria specified in
11clauses (1) through (3) of this Section and the municipality
12has adopted an ordinance authorizing the exemption under
13paragraph (e) of Section 8-11-2 of the Illinois Municipal Code.
14Upon certification of the business enterprises by the
15Department of Commerce and Economic Opportunity, the
16Department of Commerce and Economic Opportunity shall notify
17the Department of Revenue of such certification. The Department
18of Revenue shall notify the public utilities of the exemption
19status of business enterprises from the pass-on charges of
20State and municipal utility taxes. Such exemption status shall
21be effective within 3 months after certification of the
22business enterprise.
23(Source: P.A. 96-716, eff. 8-25-09; 96-865, eff. 1-21-10.)
 
24    Section 99. Effective date. This Act takes effect upon
25becoming law.