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Full Text of HB0789  96th General Assembly

HB0789enr 96TH GENERAL ASSEMBLY



 


 
HB0789 Enrolled LRB096 05803 JDS 15881 b

1     AN ACT concerning safety.
 
2     Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
 
4     Section 5. The Public Utilities Act is amended by changing
5 Section 8-403.1 as follows:
 
6     (220 ILCS 5/8-403.1)  (from Ch. 111 2/3, par. 8-403.1)
7     Sec. 8-403.1. Electricity purchased from qualified solid
8 waste energy facility; tax credit; distributions for economic
9 development.
10     (a) It is hereby declared to be the policy of this State to
11 encourage the development of alternate energy production
12 facilities in order to conserve our energy resources and to
13 provide for their most efficient use.
14     (b) For the purpose of this Section and Section 9-215.1,
15 "qualified solid waste energy facility" means a facility
16 determined by the Illinois Commerce Commission to qualify as
17 such under the Local Solid Waste Disposal Act, to use methane
18 gas generated from landfills as its primary fuel, and to
19 possess characteristics that would enable it to qualify as a
20 cogeneration or small power production facility under federal
21 law.
22     (c) In furtherance of the policy declared in this Section,
23 the Illinois Commerce Commission shall require electric

 

 

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1 utilities to enter into long-term contracts to purchase
2 electricity from qualified solid waste energy facilities
3 located in the electric utility's service area, for a period
4 beginning on the date that the facility begins generating
5 electricity and having a duration of not less than 10 years in
6 the case of facilities fueled by landfill-generated methane, or
7 20 years in the case of facilities fueled by methane generated
8 from a landfill owned by a forest preserve district. The
9 purchase rate contained in such contracts shall be equal to the
10 average amount per kilowatt-hour paid from time to time by the
11 unit or units of local government in which the electricity
12 generating facilities are located, excluding amounts paid for
13 street lighting and pumping service.
14     (d) Whenever a public utility is required to purchase
15 electricity pursuant to subsection (c) above, it shall be
16 entitled to credits in respect of its obligations to remit to
17 the State taxes it has collected under the Electricity Excise
18 Tax Law equal to the amounts, if any, by which payments for
19 such electricity exceed (i) the then current rate at which the
20 utility must purchase the output of qualified facilities
21 pursuant to the federal Public Utility Regulatory Policies Act
22 of 1978, less (ii) any costs, expenses, losses, damages or
23 other amounts incurred by the utility, or for which it becomes
24 liable, arising out of its failure to obtain such electricity
25 from such other sources. The amount of any such credit shall,
26 in the first instance, be determined by the utility, which

 

 

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1 shall make a monthly report of such credits to the Illinois
2 Commerce Commission and, on its monthly tax return, to the
3 Illinois Department of Revenue. Under no circumstances shall a
4 utility be required to purchase electricity from a qualified
5 solid waste energy facility at the rate prescribed in
6 subsection (c) of this Section if such purchase would result in
7 estimated tax credits that exceed, on a monthly basis, the
8 utility's estimated obligation to remit to the State taxes it
9 has collected under the Electricity Excise Tax Law. The owner
10 or operator shall negotiate facility operating conditions with
11 the purchasing utility in accordance with that utility's posted
12 standard terms and conditions for small power producers. If the
13 Department of Revenue disputes the amount of any such credit,
14 such dispute shall be decided by the Illinois Commerce
15 Commission. Whenever a qualified solid waste energy facility
16 has paid or otherwise satisfied in full the capital costs or
17 indebtedness incurred in developing and implementing the
18 qualified solid waste energy facility, whenever the qualified
19 solid waste energy facility ceases to operate and produce
20 electricity from methane gas generated from landfills, or at
21 the end of the contract entered into pursuant to subsection (c)
22 of this Section, whichever occurs first, the qualified solid
23 waste energy facility shall reimburse the Public Utility Fund
24 and the General Revenue Fund in the State treasury for the
25 actual reduction in payments to those Funds caused by this
26 subsection (d) in a manner to be determined by the Illinois

 

 

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1 Commerce Commission and based on the manner in which revenues
2 for those Funds were reduced. The payments shall be made to the
3 Illinois Commerce Commission, which shall determine the
4 appropriate disbursements to the Public Utility Fund and the
5 General Revenue Fund based on this subsection (d).
6     (e) The Illinois Commerce Commission shall not require an
7 electric utility to purchase electricity from any qualified
8 solid waste energy facility which is owned or operated by an
9 entity that is primarily engaged in the business of producing
10 or selling electricity, gas, or useful thermal energy from a
11 source other than one or more qualified solid waste energy
12 facilities.
13     (e-5) A qualified solid waste energy facility may receive
14 the purchase rate provided in subsection (c) of this Section
15 only for kilowatt-hours generated by the use of methane gas
16 generated from landfills. The purchase rate provided in
17 subsection (c) of this Section does not apply to electricity
18 generated by the use of a fuel that is not methane gas
19 generated from landfills. If the Illinois Commerce Commission
20 determines that a qualified solid waste energy facility has
21 violated the requirement regarding the use of methane gas
22 generated from a landfill as set forth in this subsection
23 (e-5), then the Commission shall issue an order requiring that
24 the qualified solid waste energy facility repay the State for
25 all dollar amounts of electricity sales that are determined by
26 the Commission to be the result of the violation. As part of

 

 

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1 that order, the Commission shall have the authority to revoke
2 the facility's approval to act as a qualified solid waste
3 energy facility granted by the Commission under this Section.
4 If the amount owed by the qualified solid waste energy facility
5 is not received by the Commission within 90 days after the date
6 of the Commission's order that requires repayment, then the
7 Commission shall issue an order that revokes the facility's
8 approval to act as a qualified solid waste energy facility
9 granted by the Commission under this Section. The Commission's
10 action that vacates prior qualified solid waste energy facility
11 approval does not excuse the repayment to the State treasury
12 required by subsection (d) of this Section for utility tax
13 credits accumulated up to the time of the Commission's action.
14 A qualified solid waste energy facility must receive Commission
15 approval before it may use any fuel in addition to methane gas
16 generated from a landfill in order to generate electricity. If
17 a qualified solid waste energy facility petitions the
18 Commission to use any fuel in addition to methane gas generated
19 from a landfill to generate electricity, then the Commission
20 shall have the authority to do the following:
21         (1) establish the methodology for determining the
22     amount of electricity that is generated by the use of
23     methane gas generated from a landfill and the amount that
24     is generated by the use of other fuel;
25         (2) determine all reporting requirements for the
26     qualified solid waste energy facility that are necessary

 

 

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1     for the Commission to determine the amount of electricity
2     that is generated by the use of methane gas from a landfill
3     and the amount that is generated by the use of other fuel
4     and the resulting payments to the qualified solid waste
5     energy facility; and
6         (3) require that the qualified solid waste energy
7     facility, at the qualified solid waste energy facility's
8     expense, install metering equipment that the Commission
9     determines is necessary to enforce compliance with this
10     subsection (e-5).
11     A public utility that is required to enter into a long-term
12 purchase contract with a qualified solid waste energy facility
13 has no duty to determine whether the electricity being
14 purchased was generated by the use of methane gas generated
15 from a landfill or was generated by the use of some other fuel
16 in violation of the requirements of this subsection (e-5).
17     (f) This Section does not require an electric utility to
18 construct additional facilities unless those facilities are
19 paid for by the owner or operator of the affected qualified
20 solid waste energy facility.
21     (g) The Illinois Commerce Commission shall require that:
22 (1) electric utilities use the electricity purchased from a
23 qualified solid waste energy facility to displace electricity
24 generated from nuclear power or coal mined and purchased
25 outside the boundaries of the State of Illinois before
26 displacing electricity generated from coal mined and purchased

 

 

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1 within the State of Illinois, to the extent possible, and (2)
2 electric utilities report annually to the Commission on the
3 extent of such displacements.
4     (h) Nothing in this Section is intended to cause an
5 electric utility that is required to purchase power hereunder
6 to incur any economic loss as a result of its purchase. All
7 amounts paid for power which a utility is required to purchase
8 pursuant to subparagraph (c) shall be deemed to be costs
9 prudently incurred for purposes of computing charges under
10 rates authorized by Section 9-220 of this Act. Tax credits
11 provided for herein shall be reflected in charges made pursuant
12 to rates so authorized to the extent such credits are based
13 upon a cost which is also reflected in such charges.
14     (i) Beginning in February 1999 and through January 2013
15 2009, each qualified solid waste energy facility that sells
16 electricity to an electric utility at the purchase rate
17 described in subsection (c) shall file with the Department of
18 Revenue on or before the 15th of each month a form, prescribed
19 by the Department of Revenue, that states the number of
20 kilowatt hours of electricity for which payment was received at
21 that purchase rate from electric utilities in Illinois during
22 the immediately preceding month. This form shall be accompanied
23 by a payment from the qualified solid waste energy facility in
24 an amount equal to six-tenths of a mill ($0.0006) per kilowatt
25 hour of electricity stated on the form. Beginning on the
26 effective date of this amendatory Act of the 92nd General

 

 

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1 Assembly, a qualified solid waste energy facility must file the
2 form required under this subsection (i) before the 15th of each
3 month regardless of whether the facility received any payment
4 in the previous month. Payments received by the Department of
5 Revenue shall be deposited into the Municipal Economic
6 Development Fund, a trust fund created outside the State
7 treasury. The State Treasurer may invest the moneys in the Fund
8 in any investment authorized by the Public Funds Investment
9 Act, and investment income shall be deposited into and become
10 part of the Fund. Moneys in the Fund shall be used by the State
11 Treasurer as provided in subsection (j).
12     Beginning on July 1, 2006 through January 31, 2013 2009,
13 each month the State Treasurer shall certify the following to
14 the State Comptroller:
15         (A) the amount received by the Department of Revenue
16     under this subsection (i) during the immediately preceding
17     month; and
18         (B) the amount received by the Department of Revenue
19     under this subsection (i) in the corresponding month in
20     calendar year 2002.
21 As soon as practicable after receiving the certification from
22 the State Treasurer, the State Comptroller shall transfer from
23 the General Revenue Fund to the Municipal Economic Development
24 Fund in the State treasury an amount equal to the amount by
25 which the amount calculated under item (B) of this paragraph
26 exceeds the amount calculated under item (A) of this paragraph,

 

 

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1 if any.
2     The obligation of a qualified solid waste energy facility
3 to make payments into the Municipal Economic Development Fund
4 shall terminate upon either: (1) expiration or termination of a
5 facility's contract to sell electricity to an electric utility
6 at the purchase rate described in subsection (c); or (2) entry
7 of an enforceable, final, and non-appealable order by a court
8 of competent jurisdiction that Public Act 89-448 is invalid.
9 Payments by a qualified solid waste energy facility into the
10 Municipal Economic Development Fund do not relieve the
11 qualified solid waste energy facility of its obligation to
12 reimburse the Public Utility Fund and the General Revenue Fund
13 for the actual reduction in payments to those Funds as a result
14 of credits received by electric utilities under subsection (d).
15     A qualified solid waste energy facility that fails to
16 timely file the requisite form and payment as required by this
17 subsection (i) shall be subject to penalties and interest in
18 conformance with the provisions of the Illinois Uniform Penalty
19 and Interest Act.
20     Every qualified solid waste energy facility subject to the
21 provisions of this subsection (i) shall keep and maintain
22 records and books of its sales pursuant to subsection (c),
23 including payments received from those sales and the
24 corresponding tax payments made in accordance with this
25 subsection (i), and for purposes of enforcement of this
26 subsection (i) all such books and records shall be subject to

 

 

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1 inspection by the Department of Revenue or its duly authorized
2 agents or employees.
3     When a qualified solid waste energy facility fails to file
4 the form or make the payment required under this subsection
5 (i), the Department of Revenue, to the extent that it is
6 practical, may enforce the payment obligation in a manner
7 consistent with Section 5 of the Retailers' Occupation Tax Act,
8 and if necessary may impose and enforce a tax lien in a manner
9 consistent with Sections 5a, 5b, 5c, 5d, 5e, 5f, 5g, and 5i of
10 the Retailers' Occupation Tax Act. No tax lien may be imposed
11 or enforced, however, unless a qualified solid waste energy
12 facility fails to make the payment required under this
13 subsection (i). Only to the extent necessary and for the
14 purpose of enforcing this subsection (i), the Department of
15 Revenue may secure necessary information from a qualified solid
16 waste energy facility in a manner consistent with Section 10 of
17 the Retailers' Occupation Tax Act.
18     All information received by the Department of Revenue in
19 its administration and enforcement of this subsection (i) shall
20 be confidential in a manner consistent with Section 11 of the
21 Retailers' Occupation Tax Act. The Department of Revenue may
22 adopt rules to implement the provisions of this subsection (i).
23     For purposes of implementing the maximum aggregate
24 distribution provisions in subsections (j) and (k), when a
25 qualified solid waste energy facility makes a late payment to
26 the Department of Revenue for deposit into the Municipal

 

 

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1 Economic Development Fund, that payment and deposit shall be
2 attributed to the month and corresponding quarter in which the
3 payment should have been made, and the Treasurer shall make
4 retroactive distributions or refunds, as the case may be,
5 whenever such late payments so require.
6     (j) The State Treasurer, without appropriation, must make
7 distributions immediately after January 15, April 15, July 15,
8 and October 15 of each year, up to maximum aggregate
9 distributions of $500,000 for the distributions made in the 4
10 quarters beginning with the April distribution and ending with
11 the January distribution, from the Municipal Economic
12 Development Fund to each city, village, or incorporated town
13 located in Cook County that has approved construction within
14 its boundaries of an incinerator that will burn recovered wood
15 processed for fuel to generate electricity and will commence
16 operation after 2009 : (1) uses or, on the effective date of
17 Public Act 90-813, used municipal waste as its primary fuel to
18 generate electricity; (2) was determined by the Illinois
19 Commerce Commission to qualify as a qualified solid waste
20 energy facility prior to the effective date of Public Act
21 89-448; and (3) commenced operation prior to January 1, 1998.
22 Total distributions in the aggregate to all qualified cities,
23 villages, and incorporated towns in the 4 quarters beginning
24 with the April distribution and ending with the January
25 distribution shall not exceed $500,000. The amount of each
26 distribution shall be determined pro rata based on the

 

 

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1 population of the city, village, or incorporated town compared
2 to the total population of all cities, villages, and
3 incorporated towns eligible to receive a distribution.
4 Distributions received by a city, village, or incorporated town
5 must be held in a separate account and may be used only to
6 promote and enhance industrial, commercial, residential,
7 service, transportation, and recreational activities and
8 facilities within its boundaries, thereby enhancing the
9 employment opportunities, public health and general welfare,
10 and economic development within the community, including
11 administrative expenditures exclusively to further these
12 activities. Distributions may also be used for cleanup of open
13 dumping from vacant properties and the removal of structures
14 condemned by the city, village, or incorporated town. These
15 funds, however, shall not be used by the city, village, or
16 incorporated town, directly or indirectly, to purchase, lease,
17 operate, or in any way subsidize the operation of any
18 incinerator, and these funds shall not be paid, directly or
19 indirectly, by the city, village, or incorporated town to the
20 owner, operator, lessee, shareholder, or bondholder of any
21 incinerator. Moreover, these funds shall not be used to pay
22 attorneys fees in any litigation relating to the validity of
23 Public Act 89-448. Nothing in this Section prevents a city,
24 village, or incorporated town from using other corporate funds
25 for any legitimate purpose. For purposes of this subsection,
26 the term "municipal waste" has the meaning ascribed to it in

 

 

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1 Section 3.290 of the Environmental Protection Act.
2     (k) If maximum aggregate distributions of $500,000 under
3 subsection (j) have been made after the January distribution
4 from the Municipal Economic Development Fund, then the balance
5 in the Fund shall be refunded to the qualified solid waste
6 energy facilities that made payments that were deposited into
7 the Fund during the previous 12-month period. The refunds shall
8 be prorated based upon the facility's payments in relation to
9 total payments for that 12-month period.
10     (l) Beginning January 1, 2000, and each January 1
11 thereafter, each city, village, or incorporated town that
12 received distributions from the Municipal Economic Development
13 Fund, continued to hold any of those distributions, or made
14 expenditures from those distributions during the immediately
15 preceding year shall submit to a financial and compliance and
16 program audit of those distributions performed by the Auditor
17 General at no cost to the city, village, or incorporated town
18 that received the distributions. The audit should be completed
19 by June 30 or as soon thereafter as possible. The audit shall
20 be submitted to the State Treasurer and those officers
21 enumerated in Section 3-14 of the Illinois State Auditing Act.
22 If the Auditor General finds that distributions have been
23 expended in violation of this Section, the Auditor General
24 shall refer the matter to the Attorney General. The Attorney
25 General may recover, in a civil action, 3 times the amount of
26 any distributions illegally expended. For purposes of this

 

 

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1 subsection, the terms "financial audit," "compliance audit",
2 and "program audit" have the meanings ascribed to them in
3 Sections 1-13 and 1-15 of the Illinois State Auditing Act.
4     (m) On and after the effective date of this amendatory Act
5 of the 94th General Assembly, beginning on the first date on
6 which renewable energy certificates or other saleable
7 representations are sold by a qualified solid waste energy
8 facility, with or without the electricity generated by the
9 facility, and utilized by an electric utility or another
10 electric supplier to comply with a renewable energy portfolio
11 standard mandated by Illinois law or mandated by order of the
12 Illinois Commerce Commission, that qualified solid waste
13 energy facility may not sell electricity pursuant to this
14 Section and shall be exempt from the requirements of
15 subsections (a) through (l) of this Section, except that it
16 shall remain obligated for any reimbursements required under
17 subsection (d) of this Section. All of the provisions of this
18 Section shall remain in full force and effect with respect to
19 any qualified solid waste energy facility that sold electric
20 energy pursuant to this Section at any time before July 1, 2006
21 and that does not sell renewable energy certificates or other
22 saleable representations to meet the requirements of a
23 renewable energy portfolio standard mandated by Illinois law or
24 mandated by order of the Illinois Commerce Commission.
25     (n) Notwithstanding any other provision of law to the
26 contrary, beginning on July 1, 2006, the Illinois Commerce

 

 

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1 Commission shall not issue any order determining that a
2 facility is a qualified solid waste energy facility unless the
3 qualified solid waste energy facility was determined by the
4 Illinois Commerce Commission to be a qualified solid waste
5 energy facility before July 1, 2006. As a guide to the intent,
6 interpretation, and application of this amendatory Act of the
7 94th General Assembly, it is hereby declared to be the policy
8 of this State to honor each qualified solid waste energy
9 facility contract in existence on the effective date of this
10 amendatory Act of the 94th General Assembly if the qualified
11 solid waste energy facility continues to meet the requirements
12 of this Section for the duration of its respective contract
13 term.
14 (Source: P.A. 94-836, eff. 6-6-06.)
 
15     Section 99. Effective date. This Act takes effect upon
16 becoming law.