HB5864 100TH GENERAL ASSEMBLY

  
  

 


 
100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB5864

 

Introduced , by Rep. Keith R. Wheeler - Lindsay Parkhurst - Terri Bryant - Michael P. McAuliffe - Dave Severin

 

SYNOPSIS AS INTRODUCED:
 
20 ILCS 655/5.5  from Ch. 67 1/2, par. 609.1
20 ILCS 655/13 new
35 ILCS 5/201  from Ch. 120, par. 2-201
35 ILCS 5/211
35 ILCS 5/221
35 ILCS 10/5-5
35 ILCS 10/5-51 new
35 ILCS 10/5-56 new
65 ILCS 115/10-3
65 ILCS 115/10-10.3 new
65 ILCS 115/10-10.4 new

    Amends the Illinois Enterprise Zone Act. Creates a High Impact Business construction jobs credit and an Enterprise Zone construction jobs credit against the taxpayer's Illinois income taxes based on the incremental income tax attributable to laborers or workers employed at certain construction sites located in Enterprise Zones. Amends the Economic Development for a Growing Economy Tax Credit Act. Creates a New Construction EDGE Credit based on the incremental income tax attributable to laborers or workers employed at construction sites associated with EDGE projects. Amends the River Edge Redevelopment Zone Act. Creates a River Edge construction jobs credit based on the incremental income tax attributable to laborers or workers employed at certain construction sites in a River Edge Redevelopment Zone. Requires contractors and subcontractors associated with projects that receive credits under the amendatory Act to file certified payroll information with the Department of Labor and the Department of Commerce and Economic Opportunity.


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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. This Act may be referred to as the Blue Collar
5Jobs Act.
 
6    Section 5. The Illinois Enterprise Zone Act is amended by
7changing Section 5.5 and by adding Section 13 as follows:
 
8    (20 ILCS 655/5.5)   (from Ch. 67 1/2, par. 609.1)
9    Sec. 5.5. High Impact Business.
10    (a) In order to respond to unique opportunities to assist
11in the encouragement, development, growth and expansion of the
12private sector through large scale investment and development
13projects, the Department is authorized to receive and approve
14applications for the designation of "High Impact Businesses" in
15Illinois subject to the following conditions:
16        (1) such applications may be submitted at any time
17    during the year;
18        (2) such business is not located, at the time of
19    designation, in an enterprise zone designated pursuant to
20    this Act;
21        (3) the business intends to do one or more of the
22    following:

 

 

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1            (A) the business intends to make a minimum
2        investment of $12,000,000 which will be placed in
3        service in qualified property and intends to create 500
4        full-time equivalent jobs at a designated location in
5        Illinois or intends to make a minimum investment of
6        $30,000,000 which will be placed in service in
7        qualified property and intends to retain 1,500
8        full-time retained jobs at a designated location in
9        Illinois. The business must certify in writing that the
10        investments would not be placed in service in qualified
11        property and the job creation or job retention would
12        not occur without the tax credits and exemptions set
13        forth in subsection (b) of this Section. The terms
14        "placed in service" and "qualified property" have the
15        same meanings as described in subsection (h) of Section
16        201 of the Illinois Income Tax Act; or
17            (B) the business intends to establish a new
18        electric generating facility at a designated location
19        in Illinois. "New electric generating facility", for
20        purposes of this Section, means a newly-constructed
21        electric generation plant or a newly-constructed
22        generation capacity expansion at an existing electric
23        generation plant, including the transmission lines and
24        associated equipment that transfers electricity from
25        points of supply to points of delivery, and for which
26        such new foundation construction commenced not sooner

 

 

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1        than July 1, 2001. Such facility shall be designed to
2        provide baseload electric generation and shall operate
3        on a continuous basis throughout the year; and (i)
4        shall have an aggregate rated generating capacity of at
5        least 1,000 megawatts for all new units at one site if
6        it uses natural gas as its primary fuel and foundation
7        construction of the facility is commenced on or before
8        December 31, 2004, or shall have an aggregate rated
9        generating capacity of at least 400 megawatts for all
10        new units at one site if it uses coal or gases derived
11        from coal as its primary fuel and shall support the
12        creation of at least 150 new Illinois coal mining jobs,
13        or (ii) shall be funded through a federal Department of
14        Energy grant before December 31, 2010 and shall support
15        the creation of Illinois coal-mining jobs, or (iii)
16        shall use coal gasification or integrated
17        gasification-combined cycle units that generate
18        electricity or chemicals, or both, and shall support
19        the creation of Illinois coal-mining jobs. The
20        business must certify in writing that the investments
21        necessary to establish a new electric generating
22        facility would not be placed in service and the job
23        creation in the case of a coal-fueled plant would not
24        occur without the tax credits and exemptions set forth
25        in subsection (b-5) of this Section. The term "placed
26        in service" has the same meaning as described in

 

 

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1        subsection (h) of Section 201 of the Illinois Income
2        Tax Act; or
3            (B-5) the business intends to establish a new
4        gasification facility at a designated location in
5        Illinois. As used in this Section, "new gasification
6        facility" means a newly constructed coal gasification
7        facility that generates chemical feedstocks or
8        transportation fuels derived from coal (which may
9        include, but are not limited to, methane, methanol, and
10        nitrogen fertilizer), that supports the creation or
11        retention of Illinois coal-mining jobs, and that
12        qualifies for financial assistance from the Department
13        before December 31, 2010. A new gasification facility
14        does not include a pilot project located within
15        Jefferson County or within a county adjacent to
16        Jefferson County for synthetic natural gas from coal;
17        or
18            (C) the business intends to establish production
19        operations at a new coal mine, re-establish production
20        operations at a closed coal mine, or expand production
21        at an existing coal mine at a designated location in
22        Illinois not sooner than July 1, 2001; provided that
23        the production operations result in the creation of 150
24        new Illinois coal mining jobs as described in
25        subdivision (a)(3)(B) of this Section, and further
26        provided that the coal extracted from such mine is

 

 

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1        utilized as the predominant source for a new electric
2        generating facility. The business must certify in
3        writing that the investments necessary to establish a
4        new, expanded, or reopened coal mine would not be
5        placed in service and the job creation would not occur
6        without the tax credits and exemptions set forth in
7        subsection (b-5) of this Section. The term "placed in
8        service" has the same meaning as described in
9        subsection (h) of Section 201 of the Illinois Income
10        Tax Act; or
11            (D) the business intends to construct new
12        transmission facilities or upgrade existing
13        transmission facilities at designated locations in
14        Illinois, for which construction commenced not sooner
15        than July 1, 2001. For the purposes of this Section,
16        "transmission facilities" means transmission lines
17        with a voltage rating of 115 kilovolts or above,
18        including associated equipment, that transfer
19        electricity from points of supply to points of delivery
20        and that transmit a majority of the electricity
21        generated by a new electric generating facility
22        designated as a High Impact Business in accordance with
23        this Section. The business must certify in writing that
24        the investments necessary to construct new
25        transmission facilities or upgrade existing
26        transmission facilities would not be placed in service

 

 

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1        without the tax credits and exemptions set forth in
2        subsection (b-5) of this Section. The term "placed in
3        service" has the same meaning as described in
4        subsection (h) of Section 201 of the Illinois Income
5        Tax Act; or
6            (E) the business intends to establish a new wind
7        power facility at a designated location in Illinois.
8        For purposes of this Section, "new wind power facility"
9        means a newly constructed electric generation
10        facility, or a newly constructed expansion of an
11        existing electric generation facility, placed in
12        service on or after July 1, 2009, that generates
13        electricity using wind energy devices, and such
14        facility shall be deemed to include all associated
15        transmission lines, substations, and other equipment
16        related to the generation of electricity from wind
17        energy devices. For purposes of this Section, "wind
18        energy device" means any device, with a nameplate
19        capacity of at least 0.5 megawatts, that is used in the
20        process of converting kinetic energy from the wind to
21        generate electricity; or
22            (F) the business commits to (i) make a minimum
23        investment of $500,000,000, which will be placed in
24        service in a qualified property, (ii) create 125
25        full-time equivalent jobs at a designated location in
26        Illinois, (iii) establish a fertilizer plant at a

 

 

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1        designated location in Illinois that complies with the
2        set-back standards as described in Table 1: Initial
3        Isolation and Protective Action Distances in the 2012
4        Emergency Response Guidebook published by the United
5        States Department of Transportation, (iv) pay a
6        prevailing wage for employees at that location who are
7        engaged in construction activities, and (v) secure an
8        appropriate level of general liability insurance to
9        protect against catastrophic failure of the fertilizer
10        plant or any of its constituent systems; in addition,
11        the business must agree to enter into a construction
12        project labor agreement including provisions
13        establishing wages, benefits, and other compensation
14        for employees performing work under the project labor
15        agreement at that location; for the purposes of this
16        Section, "fertilizer plant" means a newly constructed
17        or upgraded plant utilizing gas used in the production
18        of anhydrous ammonia and downstream nitrogen
19        fertilizer products for resale; for the purposes of
20        this Section, "prevailing wage" means the hourly cash
21        wages plus fringe benefits for training and
22        apprenticeship programs approved by the U.S.
23        Department of Labor, Bureau of Apprenticeship and
24        Training, health and welfare, insurance, vacations and
25        pensions paid generally, in the locality in which the
26        work is being performed, to employees engaged in work

 

 

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1        of a similar character on public works; this paragraph
2        (F) applies only to businesses that submit an
3        application to the Department within 60 days after the
4        effective date of this amendatory Act of the 98th
5        General Assembly; and
6        (4) no later than 90 days after an application is
7    submitted, the Department shall notify the applicant of the
8    Department's determination of the qualification of the
9    proposed High Impact Business under this Section.
10    (b) Businesses designated as High Impact Businesses
11pursuant to subdivision (a)(3)(A) of this Section shall qualify
12for the credits and exemptions described in the following Acts:
13Section 9-222 and Section 9-222.1A of the Public Utilities Act,
14subsection (h) of Section 201 of the Illinois Income Tax Act,
15and Section 1d of the Retailers' Occupation Tax Act; provided
16that these credits and exemptions described in these Acts shall
17not be authorized until the minimum investments set forth in
18subdivision (a)(3)(A) of this Section have been placed in
19service in qualified properties and, in the case of the
20exemptions described in the Public Utilities Act and Section 1d
21of the Retailers' Occupation Tax Act, the minimum full-time
22equivalent jobs or full-time retained jobs set forth in
23subdivision (a)(3)(A) of this Section have been created or
24retained. Businesses designated as High Impact Businesses
25under this Section shall also qualify for the exemption
26described in Section 5l of the Retailers' Occupation Tax Act.

 

 

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1The credit provided in subsection (h) of Section 201 of the
2Illinois Income Tax Act shall be applicable to investments in
3qualified property as set forth in subdivision (a)(3)(A) of
4this Section.
5    (b-5) Businesses designated as High Impact Businesses
6pursuant to subdivisions (a)(3)(B), (a)(3)(B-5), (a)(3)(C),
7and (a)(3)(D) of this Section shall qualify for the credits and
8exemptions described in the following Acts: Section 51 of the
9Retailers' Occupation Tax Act, Section 9-222 and Section
109-222.1A of the Public Utilities Act, and subsection (h) of
11Section 201 of the Illinois Income Tax Act; however, the
12credits and exemptions authorized under Section 9-222 and
13Section 9-222.1A of the Public Utilities Act, and subsection
14(h) of Section 201 of the Illinois Income Tax Act shall not be
15authorized until the new electric generating facility, the new
16gasification facility, the new transmission facility, or the
17new, expanded, or reopened coal mine is operational, except
18that a new electric generating facility whose primary fuel
19source is natural gas is eligible only for the exemption under
20Section 5l of the Retailers' Occupation Tax Act.
21    (b-6) Businesses designated as High Impact Businesses
22pursuant to subdivision (a)(3)(E) of this Section shall qualify
23for the exemptions described in Section 5l of the Retailers'
24Occupation Tax Act; any business so designated as a High Impact
25Business being, for purposes of this Section, a "Wind Energy
26Business".

 

 

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1    (b-7) Businesses designated as High Impact Businesses by
2the Department shall qualify for the High Impact Business
3construction jobs credit under subsection (h-5) of Section 201
4of the Illinois Income Tax Act if the business meets the
5criteria set forth in subsection (i) of this Section.
6    (c) High Impact Businesses located in federally designated
7foreign trade zones or sub-zones are also eligible for
8additional credits, exemptions and deductions as described in
9the following Acts: Section 9-221 and Section 9-222.1 of the
10Public Utilities Act; and subsection (g) of Section 201, and
11Section 203 of the Illinois Income Tax Act.
12    (d) Except for businesses contemplated under subdivision
13(a)(3)(E) of this Section, existing Illinois businesses which
14apply for designation as a High Impact Business must provide
15the Department with the prospective plan for which 1,500
16full-time retained jobs would be eliminated in the event that
17the business is not designated.
18    (e) Except for new wind power facilities contemplated under
19subdivision (a)(3)(E) of this Section, new proposed facilities
20which apply for designation as High Impact Business must
21provide the Department with proof of alternative non-Illinois
22sites which would receive the proposed investment and job
23creation in the event that the business is not designated as a
24High Impact Business.
25    (f) Except for businesses contemplated under subdivision
26(a)(3)(E) of this Section, in the event that a business is

 

 

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1designated a High Impact Business and it is later determined
2after reasonable notice and an opportunity for a hearing as
3provided under the Illinois Administrative Procedure Act, that
4the business would have placed in service in qualified property
5the investments and created or retained the requisite number of
6jobs without the benefits of the High Impact Business
7designation, the Department shall be required to immediately
8revoke the designation and notify the Director of the
9Department of Revenue who shall begin proceedings to recover
10all wrongfully exempted State taxes with interest. The business
11shall also be ineligible for all State funded Department
12programs for a period of 10 years.
13    (g) The Department shall revoke a High Impact Business
14designation if the participating business fails to comply with
15the terms and conditions of the designation. However, the
16penalties for new wind power facilities or Wind Energy
17Businesses for failure to comply with any of the terms or
18conditions of the Illinois Prevailing Wage Act shall be only
19those penalties identified in the Illinois Prevailing Wage Act,
20and the Department shall not revoke a High Impact Business
21designation as a result of the failure to comply with any of
22the terms or conditions of the Illinois Prevailing Wage Act in
23relation to a new wind power facility or a Wind Energy
24Business.
25    (h) Prior to designating a business, the Department shall
26provide the members of the General Assembly and Commission on

 

 

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1Government Forecasting and Accountability with a report
2setting forth the terms and conditions of the designation and
3guarantees that have been received by the Department in
4relation to the proposed business being designated.
5    (i) High Impact Business construction jobs credit. A High
6Impact Business may receive a tax credit against the tax
7imposed under subsections (a) and (b) of Section 201 of the
8Illinois Income Tax Act in an amount equal to 50% of the amount
9of the incremental income tax attributable to High Impact
10Business construction jobs credit employees employed in the
11course of completing a High Impact Business construction jobs
12project. However, the High Impact Business construction jobs
13credit may equal 75% of the amount of the incremental income
14tax attributable to High Impact Business construction jobs
15credit employees if the High Impact Business construction jobs
16credit project is located in an underserved area.
17    The Department shall certify to the Department of Revenue:
18(1) the identity of taxpayers that are eligible for the High
19Impact Business construction jobs credit; and (2) the amount of
20High Impact Business construction jobs credits that are claimed
21pursuant to subsection (h-5) of Section 201 of the Illinois
22Income Tax Act in each taxable year. Any business entity that
23receives a High Impact Business construction jobs credit shall
24maintain a certified payroll pursuant to subsection (j) of this
25Section.
26    As used in this subsection (i):

 

 

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1    "High Impact Business construction jobs credit" means an
2amount equal to 50% (or 75% if the High Impact Business
3construction project is located in an underserved area) of the
4incremental income tax attributable to High Impact Business
5construction job employees.
6    "High Impact Business construction job employee" means a
7laborer or worker who is employed by an Illinois contractor or
8subcontractor in the actual construction work on the site of a
9High Impact Business construction job project.
10    "High Impact Business construction jobs project" means
11building a structure or building or making improvements of any
12kind to real property, undertaken and commissioned by a
13business that was designated as a High Impact Business by the
14Department. The term "High Impact Business construction jobs
15project" does not include the routine operation, routine
16repair, or routine maintenance of existing structures,
17buildings, or real property.
18    "Incremental income tax" means the total amount withheld
19during the taxable year from the compensation of High Impact
20Business construction job employees.
21    "Underserved area" means a geographic area that meets one
22or more of the following conditions:
23        (1) the area has a poverty rate of at least 20%
24    according to the latest federal decennial census;
25        (2) 75% or more of the children in the area participate
26    in the federal free lunch program according to reported

 

 

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1    statistics from the State Board of Education;
2        (3) at least 20% of the households in the area receive
3    assistance under the Supplemental Nutrition Assistance
4    Program (SNAP); or
5        (4) the area has an average unemployment rate, as
6    determined by the Illinois Department of Employment
7    Security, that is more than 120% of the national
8    unemployment average, as determined by the U.S. Department
9    of Labor, for a period of at least 2 consecutive calendar
10    years preceding the date of the application.
11    (j) Each contractor and subcontractor who is engaged in and
12executing a High Impact Business Construction jobs project, as
13defined under subsection (i) of this Section, for a business
14that is entitled to a credit pursuant to subsection (i) of this
15Section shall:
16        (1) make and keep, for a period of 5 years from the
17    date of the last payment made on or after the effective
18    date of this amendatory Act of the 100th General Assembly
19    on a contract or subcontract for a High Impact Business
20    Construction Jobs Project, records for all laborers and
21    other workers employed by the contractor or subcontractor
22    on the project; the records shall include:
23            (A) the worker's name;
24            (B) the worker's address;
25            (C) the worker's telephone number, if available;
26            (D) the worker's social security number;

 

 

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1            (E) the worker's classification or
2        classifications;
3            (F) the worker's gross and net wages paid in each
4        pay period;
5            (G) the worker's number of hours worked each day;
6            (H) the worker's starting and ending times of work
7        each day;
8            (I) the worker's hourly wage rate; and
9            (J) the worker's hourly overtime wage rate;
10        (2) no later than the 15th day of each calendar month,
11    provide a certified payroll for the immediately preceding
12    month to the taxpayer in charge of the High Impact Business
13    construction jobs project; within 5 business days after
14    receiving the certified payroll, the taxpayer shall file
15    the certified payroll with the Department of Labor and the
16    Department of Commerce and Economic Opportunity; a
17    certified payroll must be filed for only those calendar
18    months during which construction on a High Impact Business
19    construction jobs project has occurred; the certified
20    payroll shall consist of a complete copy of the records
21    identified in paragraph (1) of this subsection (j), but may
22    exclude the starting and ending times of work each day; the
23    certified payroll shall be accompanied by a statement
24    signed by the contractor or subcontractor or an officer,
25    employee, or agent of the contractor or subcontractor which
26    avers that:

 

 

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1            (A) he or she has examined the certified payroll
2        records required to be submitted by the Act and such
3        records are true and accurate; and
4            (B) the contractor or subcontractor is aware that
5        filing a certified payroll that he or she knows to be
6        false is a Class A misdemeanor.
7    A general contractor is not prohibited from relying on a
8certified payroll of a lower-tier subcontractor, provided the
9general contractor does not knowingly rely upon a
10subcontractor's false certification.
11    Any contractor or subcontractor subject to this
12subsection, and any officer, employee, or agent of such
13contractor or subcontractor whose duty as an officer, employee,
14or agent it is to file a certified payroll under this
15subsection, who willfully fails to file such a certified
16payroll on or before the date such certified payroll is
17required by this paragraph to be filed and any person who
18willfully files a false certified payroll that is false as to
19any material fact is in violation of this Act and guilty of a
20Class A misdemeanor.
21    The taxpayer in charge of the project shall keep the
22records submitted in accordance with this subsection on or
23after the effective date of this Act of the 100th General
24Assembly for a period of 5 years from the date of the last
25payment for work on a contract or subcontract for the High
26Impact Business construction jobs project.

 

 

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1    The records submitted in accordance with this subsection
2shall be considered public records, except an employee's
3address, telephone number, and social security number, and made
4available in accordance with the Freedom of Information Act.
5The Department of Labor shall accept any reasonable submissions
6by the contractor that meet the requirements of this subsection
7(j) and shall share the information with the Department in
8order to comply with the awarding of a High Impact Business
9construction jobs credit. A contractor, subcontractor, or
10public body may retain records required under this Section in
11paper or electronic format.
12    (k) Upon 7 business days' notice, each contractor and
13subcontractor shall make available for inspection and copying
14at a location within this State during reasonable hours, the
15records identified in this subsection (j) to the taxpayer in
16charge of the High Impact Business construction jobs project,
17its officers and agents, the Director of the Department of
18Labor and his deputies and agents, and to federal, State, or
19local law enforcement agencies and prosecutors.
20(Source: P.A. 97-905, eff. 8-7-12; 98-109, eff. 7-25-13.)
 
21    (20 ILCS 655/13 new)
22    Sec. 13. Enterprise Zone construction jobs credit.
23    (a) A business entity in a certified Enterprise Zone that
24makes a capital investment of at least $10,000,000 in an
25Enterprise Zone construction jobs project may receive an

 

 

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1Enterprise Zone construction jobs credit against the tax
2imposed under subsections (a) and (b) of Section 201 of the
3Illinois Income Tax Act in an amount equal to 50% of the amount
4of the incremental income tax attributable to Enterprise Zone
5construction jobs credit employees employed in the course of
6completing an Enterprise Zone construction jobs project.
7However, the Enterprise Zone construction jobs credit may equal
875% of the amount of the incremental income tax attributable to
9Enterprise Zone construction jobs credit employees if the
10project is located in an underserved area.
11    (b) A business entity seeking a credit under this Section
12must submit an application to the Department and must receive
13approval from the designating municipality or county and the
14Department for the Enterprise Zone construction jobs credit
15project. The application must describe the nature and benefit
16of the project to the certified Enterprise Zone and its
17potential contributors.
18    Within 45 days after receipt of an application, the
19Department shall give notice to the applicant as to whether the
20application has been approved or disapproved. If the Department
21disapproves the application, it shall specify the reasons for
22this decision and allow 60 days for the applicant to amend and
23resubmit its application. The Department shall provide
24assistance upon request to applicants. Resubmitted
25applications shall receive the Department's approval or
26disapproval within 30 days after the application is

 

 

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1resubmitted. Those resubmitted applications satisfying initial
2Department objectives shall be approved unless reasonable
3circumstances warrant disapproval.
4    On an annual basis, the designated zone organization shall
5furnish a statement to the Department on the programmatic and
6financial status of any approved project and an audited
7financial statement of the project.
8    The Department shall certify to the Department of Revenue
9the identity of taxpayers who are eligible for the credits and
10the amount of credits that are claimed pursuant to subparagraph
11(8) of subsection (f) of Section 201 the Illinois Income Tax
12Act.
13    The Enterprise Zone construction jobs credit project must
14be undertaken by the business entity in the course of
15completing a project that complies with the criteria contained
16in Section 4 of this Act and is undertaken in a certified
17Enterprise Zone. The Department shall adopt any necessary rules
18for the implementation of this subsection (b).
19    (c) Any business entity that receives an Enterprise Zone
20construction jobs credit shall maintain a certified payroll
21pursuant to subsection (d) of this Section.
22    (d) Each contractor and subcontractor who is engaged in and
23is executing an Enterprise Zone Construction jobs credit
24project for a business that is entitled to a credit pursuant to
25this Section shall:
26        (1) make and keep, for a period of 5 years from the

 

 

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1    date of the last payment made on or after the effective
2    date of this amendatory Act of the 100th General Assembly
3    on a contract or subcontract for an Enterprise Zone
4    construction jobs credit project, records for all laborers
5    and other workers employed by them on the project; the
6    records shall include:
7            (A) the worker's name;
8            (B) the worker's address;
9            (C) the worker's telephone number, if available;
10            (D) the worker's social security number;
11            (E) the worker's classification or
12        classifications;
13            (F) the worker's gross and net wages paid in each
14        pay period;
15            (G) the worker's number of hours worked each day;
16            (H) the worker's starting and ending times of work
17        each day;
18            (I) the worker's hourly wage rate; and
19            (J) the worker's hourly overtime wage rate;
20        (2) no later than the 15th day of each calendar month,
21    provide a certified payroll for the immediately preceding
22    month to the taxpayer in charge of the project; within 5
23    business days after receiving the certified payroll, the
24    taxpayer shall file the certified payroll with the
25    Department of Labor and the Department of Commerce and
26    Economic Opportunity; a certified payroll must be filed for

 

 

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1    only those calendar months during which construction on an
2    Enterprise Zone construction jobs project has occurred;
3    the certified payroll shall consist of a complete copy of
4    the records identified in paragraph (1) of this subsection
5    (d), but may exclude the starting and ending times of work
6    each day; the certified payroll shall be accompanied by a
7    statement signed by the contractor or subcontractor or an
8    officer, employee, or agent of the contractor or
9    subcontractor which avers that:
10            (A) he or she has examined the certified payroll
11        records required to be submitted by the Act and such
12        records are true and accurate; and
13            (B) the contractor or subcontractor is aware that
14        filing a certified payroll that he or she knows to be
15        false is a Class A misdemeanor.
16    A general contractor is not prohibited from relying on a
17certified payroll of a lower-tier subcontractor, provided the
18general contractor does not knowingly rely upon a
19subcontractor's false certification.
20    Any contractor or subcontractor subject to this
21subsection, and any officer, employee, or agent of such
22contractor or subcontractor whose duty as an officer, employee,
23or agent it is to file a certified payroll under this
24subsection, who willfully fails to file such a certified
25payroll on or before the date such certified payroll is
26required by this paragraph to be filed and any person who

 

 

HB5864- 22 -LRB100 21647 AXK 38878 b

1willfully files a false certified payroll that is false as to
2any material fact is in violation of this Act and guilty of a
3Class A misdemeanor.
4    The taxpayer in charge of the project shall keep the
5records submitted in accordance with this subsection on or
6after the effective date of this Act of the 100th General
7Assembly for a period of 5 years from the date of the last
8payment for work on a contract or subcontract for the project.
9    The records submitted in accordance with this subsection
10shall be considered public records, except an employee's
11address, telephone number, and social security number, and made
12available in accordance with the Freedom of Information Act.
13The Department of Labor shall accept any reasonable submissions
14by the contractor that meet the requirements of this subsection
15and shall share the information with the Department in order to
16comply with the awarding of Enterprise Zone construction jobs
17credits. A contractor, subcontractor, or public body may retain
18records required under this Section in paper or electronic
19format.
20    Upon 7 business days' notice, the contractor and each
21subcontractor shall make available for inspection and copying
22at a location within this State during reasonable hours, the
23records identified in paragraph (1) of this subsection to the
24taxpayer in charge of the project, its officers and agents, the
25Director of Labor and his deputies and agents, and to federal,
26State, or local law enforcement agencies and prosecutors.

 

 

HB5864- 23 -LRB100 21647 AXK 38878 b

1    (e) As used in this Section:
2    "Enterprise Zone construction jobs credit" means an amount
3equal to 50% (or 75% if the project is located in an
4underserved area) of the incremental income tax attributable to
5Enterprise Zone construction jobs credit employees.
6    "Enterprise Zone construction jobs credit employee" means
7a laborer or worker who is employed by an Illinois contractor
8or subcontractor in the actual construction work on the site of
9an Enterprise Zone construction jobs credit project.
10    "Enterprise Zone construction jobs credit project" means
11building a structure or building or making improvements of any
12kind to real property commissioned and paid for by a business
13that has applied and been approved for an Enterprise Zone
14construction jobs credit pursuant to this Section. "Enterprise
15Zone construction jobs credit project" does not include the
16routine operation, routine repair, or routine maintenance of
17existing structures, buildings, or real property.
18    "Incremental income tax" means the total amount withheld
19during the taxable year from the compensation of Enterprise
20Zone construction jobs credit employees.
21    "Underserved area" means a geographic area that meets one
22or more of the following conditions:
23        (1) the area has a poverty rate of at least 20%
24    according to the latest federal decennial census;
25        (2) 75% or more of the children in the area participate
26    in the federal free lunch program according to reported

 

 

HB5864- 24 -LRB100 21647 AXK 38878 b

1    statistics from the State Board of Education;
2        (3) at least 20% of the households in the area receive
3    assistance under the Supplemental Nutrition Assistance
4    Program (SNAP); or
5        (4) the area has an average unemployment rate, as
6    determined by the Illinois Department of Employment
7    Security, that is more than 120% of the national
8    unemployment average, as determined by the U.S. Department
9    of Labor, for a period of at least 2 consecutive calendar
10    years preceding the date of the application.
 
11    Section 10. The Illinois Income Tax Act is amended by
12changing Sections 201, 211, and 221 as follows:
 
13    (35 ILCS 5/201)  (from Ch. 120, par. 2-201)
14    Sec. 201. Tax imposed.
15    (a) In general. A tax measured by net income is hereby
16imposed on every individual, corporation, trust and estate for
17each taxable year ending after July 31, 1969 on the privilege
18of earning or receiving income in or as a resident of this
19State. Such tax shall be in addition to all other occupation or
20privilege taxes imposed by this State or by any municipal
21corporation or political subdivision thereof.
22    (b) Rates. The tax imposed by subsection (a) of this
23Section shall be determined as follows, except as adjusted by
24subsection (d-1):

 

 

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1        (1) In the case of an individual, trust or estate, for
2    taxable years ending prior to July 1, 1989, an amount equal
3    to 2 1/2% of the taxpayer's net income for the taxable
4    year.
5        (2) In the case of an individual, trust or estate, for
6    taxable years beginning prior to July 1, 1989 and ending
7    after June 30, 1989, an amount equal to the sum of (i) 2
8    1/2% of the taxpayer's net income for the period prior to
9    July 1, 1989, as calculated under Section 202.3, and (ii)
10    3% of the taxpayer's net income for the period after June
11    30, 1989, as calculated under Section 202.3.
12        (3) In the case of an individual, trust or estate, for
13    taxable years beginning after June 30, 1989, and ending
14    prior to January 1, 2011, an amount equal to 3% of the
15    taxpayer's net income for the taxable year.
16        (4) In the case of an individual, trust, or estate, for
17    taxable years beginning prior to January 1, 2011, and
18    ending after December 31, 2010, an amount equal to the sum
19    of (i) 3% of the taxpayer's net income for the period prior
20    to January 1, 2011, as calculated under Section 202.5, and
21    (ii) 5% of the taxpayer's net income for the period after
22    December 31, 2010, as calculated under Section 202.5.
23        (5) In the case of an individual, trust, or estate, for
24    taxable years beginning on or after January 1, 2011, and
25    ending prior to January 1, 2015, an amount equal to 5% of
26    the taxpayer's net income for the taxable year.

 

 

HB5864- 26 -LRB100 21647 AXK 38878 b

1        (5.1) In the case of an individual, trust, or estate,
2    for taxable years beginning prior to January 1, 2015, and
3    ending after December 31, 2014, an amount equal to the sum
4    of (i) 5% of the taxpayer's net income for the period prior
5    to January 1, 2015, as calculated under Section 202.5, and
6    (ii) 3.75% of the taxpayer's net income for the period
7    after December 31, 2014, as calculated under Section 202.5.
8        (5.2) In the case of an individual, trust, or estate,
9    for taxable years beginning on or after January 1, 2015,
10    and ending prior to July 1, 2017, an amount equal to 3.75%
11    of the taxpayer's net income for the taxable year.
12        (5.3) In the case of an individual, trust, or estate,
13    for taxable years beginning prior to July 1, 2017, and
14    ending after June 30, 2017, an amount equal to the sum of
15    (i) 3.75% of the taxpayer's net income for the period prior
16    to July 1, 2017, as calculated under Section 202.5, and
17    (ii) 4.95% of the taxpayer's net income for the period
18    after June 30, 2017, as calculated under Section 202.5.
19        (5.4) In the case of an individual, trust, or estate,
20    for taxable years beginning on or after July 1, 2017, an
21    amount equal to 4.95% of the taxpayer's net income for the
22    taxable year.
23        (6) In the case of a corporation, for taxable years
24    ending prior to July 1, 1989, an amount equal to 4% of the
25    taxpayer's net income for the taxable year.
26        (7) In the case of a corporation, for taxable years

 

 

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1    beginning prior to July 1, 1989 and ending after June 30,
2    1989, an amount equal to the sum of (i) 4% of the
3    taxpayer's net income for the period prior to July 1, 1989,
4    as calculated under Section 202.3, and (ii) 4.8% of the
5    taxpayer's net income for the period after June 30, 1989,
6    as calculated under Section 202.3.
7        (8) In the case of a corporation, for taxable years
8    beginning after June 30, 1989, and ending prior to January
9    1, 2011, an amount equal to 4.8% of the taxpayer's net
10    income for the taxable year.
11        (9) In the case of a corporation, for taxable years
12    beginning prior to January 1, 2011, and ending after
13    December 31, 2010, an amount equal to the sum of (i) 4.8%
14    of the taxpayer's net income for the period prior to
15    January 1, 2011, as calculated under Section 202.5, and
16    (ii) 7% of the taxpayer's net income for the period after
17    December 31, 2010, as calculated under Section 202.5.
18        (10) In the case of a corporation, for taxable years
19    beginning on or after January 1, 2011, and ending prior to
20    January 1, 2015, an amount equal to 7% of the taxpayer's
21    net income for the taxable year.
22        (11) In the case of a corporation, for taxable years
23    beginning prior to January 1, 2015, and ending after
24    December 31, 2014, an amount equal to the sum of (i) 7% of
25    the taxpayer's net income for the period prior to January
26    1, 2015, as calculated under Section 202.5, and (ii) 5.25%

 

 

HB5864- 28 -LRB100 21647 AXK 38878 b

1    of the taxpayer's net income for the period after December
2    31, 2014, as calculated under Section 202.5.
3        (12) In the case of a corporation, for taxable years
4    beginning on or after January 1, 2015, and ending prior to
5    July 1, 2017, an amount equal to 5.25% of the taxpayer's
6    net income for the taxable year.
7        (13) In the case of a corporation, for taxable years
8    beginning prior to July 1, 2017, and ending after June 30,
9    2017, an amount equal to the sum of (i) 5.25% of the
10    taxpayer's net income for the period prior to July 1, 2017,
11    as calculated under Section 202.5, and (ii) 7% of the
12    taxpayer's net income for the period after June 30, 2017,
13    as calculated under Section 202.5.
14        (14) In the case of a corporation, for taxable years
15    beginning on or after July 1, 2017, an amount equal to 7%
16    of the taxpayer's net income for the taxable year.
17    The rates under this subsection (b) are subject to the
18provisions of Section 201.5.
19    (c) Personal Property Tax Replacement Income Tax.
20Beginning on July 1, 1979 and thereafter, in addition to such
21income tax, there is also hereby imposed the Personal Property
22Tax Replacement Income Tax measured by net income on every
23corporation (including Subchapter S corporations), partnership
24and trust, for each taxable year ending after June 30, 1979.
25Such taxes are imposed on the privilege of earning or receiving
26income in or as a resident of this State. The Personal Property

 

 

HB5864- 29 -LRB100 21647 AXK 38878 b

1Tax Replacement Income Tax shall be in addition to the income
2tax imposed by subsections (a) and (b) of this Section and in
3addition to all other occupation or privilege taxes imposed by
4this State or by any municipal corporation or political
5subdivision thereof.
6    (d) Additional Personal Property Tax Replacement Income
7Tax Rates. The personal property tax replacement income tax
8imposed by this subsection and subsection (c) of this Section
9in the case of a corporation, other than a Subchapter S
10corporation and except as adjusted by subsection (d-1), shall
11be an additional amount equal to 2.85% of such taxpayer's net
12income for the taxable year, except that beginning on January
131, 1981, and thereafter, the rate of 2.85% specified in this
14subsection shall be reduced to 2.5%, and in the case of a
15partnership, trust or a Subchapter S corporation shall be an
16additional amount equal to 1.5% of such taxpayer's net income
17for the taxable year.
18    (d-1) Rate reduction for certain foreign insurers. In the
19case of a foreign insurer, as defined by Section 35A-5 of the
20Illinois Insurance Code, whose state or country of domicile
21imposes on insurers domiciled in Illinois a retaliatory tax
22(excluding any insurer whose premiums from reinsurance assumed
23are 50% or more of its total insurance premiums as determined
24under paragraph (2) of subsection (b) of Section 304, except
25that for purposes of this determination premiums from
26reinsurance do not include premiums from inter-affiliate

 

 

HB5864- 30 -LRB100 21647 AXK 38878 b

1reinsurance arrangements), beginning with taxable years ending
2on or after December 31, 1999, the sum of the rates of tax
3imposed by subsections (b) and (d) shall be reduced (but not
4increased) to the rate at which the total amount of tax imposed
5under this Act, net of all credits allowed under this Act,
6shall equal (i) the total amount of tax that would be imposed
7on the foreign insurer's net income allocable to Illinois for
8the taxable year by such foreign insurer's state or country of
9domicile if that net income were subject to all income taxes
10and taxes measured by net income imposed by such foreign
11insurer's state or country of domicile, net of all credits
12allowed or (ii) a rate of zero if no such tax is imposed on such
13income by the foreign insurer's state of domicile. For the
14purposes of this subsection (d-1), an inter-affiliate includes
15a mutual insurer under common management.
16        (1) For the purposes of subsection (d-1), in no event
17    shall the sum of the rates of tax imposed by subsections
18    (b) and (d) be reduced below the rate at which the sum of:
19            (A) the total amount of tax imposed on such foreign
20        insurer under this Act for a taxable year, net of all
21        credits allowed under this Act, plus
22            (B) the privilege tax imposed by Section 409 of the
23        Illinois Insurance Code, the fire insurance company
24        tax imposed by Section 12 of the Fire Investigation
25        Act, and the fire department taxes imposed under
26        Section 11-10-1 of the Illinois Municipal Code,

 

 

HB5864- 31 -LRB100 21647 AXK 38878 b

1    equals 1.25% for taxable years ending prior to December 31,
2    2003, or 1.75% for taxable years ending on or after
3    December 31, 2003, of the net taxable premiums written for
4    the taxable year, as described by subsection (1) of Section
5    409 of the Illinois Insurance Code. This paragraph will in
6    no event increase the rates imposed under subsections (b)
7    and (d).
8        (2) Any reduction in the rates of tax imposed by this
9    subsection shall be applied first against the rates imposed
10    by subsection (b) and only after the tax imposed by
11    subsection (a) net of all credits allowed under this
12    Section other than the credit allowed under subsection (i)
13    has been reduced to zero, against the rates imposed by
14    subsection (d).
15    This subsection (d-1) is exempt from the provisions of
16Section 250.
17    (e) Investment credit. A taxpayer shall be allowed a credit
18against the Personal Property Tax Replacement Income Tax for
19investment in qualified property.
20        (1) A taxpayer shall be allowed a credit equal to .5%
21    of the basis of qualified property placed in service during
22    the taxable year, provided such property is placed in
23    service on or after July 1, 1984. There shall be allowed an
24    additional credit equal to .5% of the basis of qualified
25    property placed in service during the taxable year,
26    provided such property is placed in service on or after

 

 

HB5864- 32 -LRB100 21647 AXK 38878 b

1    July 1, 1986, and the taxpayer's base employment within
2    Illinois has increased by 1% or more over the preceding
3    year as determined by the taxpayer's employment records
4    filed with the Illinois Department of Employment Security.
5    Taxpayers who are new to Illinois shall be deemed to have
6    met the 1% growth in base employment for the first year in
7    which they file employment records with the Illinois
8    Department of Employment Security. The provisions added to
9    this Section by Public Act 85-1200 (and restored by Public
10    Act 87-895) shall be construed as declaratory of existing
11    law and not as a new enactment. If, in any year, the
12    increase in base employment within Illinois over the
13    preceding year is less than 1%, the additional credit shall
14    be limited to that percentage times a fraction, the
15    numerator of which is .5% and the denominator of which is
16    1%, but shall not exceed .5%. The investment credit shall
17    not be allowed to the extent that it would reduce a
18    taxpayer's liability in any tax year below zero, nor may
19    any credit for qualified property be allowed for any year
20    other than the year in which the property was placed in
21    service in Illinois. For tax years ending on or after
22    December 31, 1987, and on or before December 31, 1988, the
23    credit shall be allowed for the tax year in which the
24    property is placed in service, or, if the amount of the
25    credit exceeds the tax liability for that year, whether it
26    exceeds the original liability or the liability as later

 

 

HB5864- 33 -LRB100 21647 AXK 38878 b

1    amended, such excess may be carried forward and applied to
2    the tax liability of the 5 taxable years following the
3    excess credit years if the taxpayer (i) makes investments
4    which cause the creation of a minimum of 2,000 full-time
5    equivalent jobs in Illinois, (ii) is located in an
6    enterprise zone established pursuant to the Illinois
7    Enterprise Zone Act and (iii) is certified by the
8    Department of Commerce and Community Affairs (now
9    Department of Commerce and Economic Opportunity) as
10    complying with the requirements specified in clause (i) and
11    (ii) by July 1, 1986. The Department of Commerce and
12    Community Affairs (now Department of Commerce and Economic
13    Opportunity) shall notify the Department of Revenue of all
14    such certifications immediately. For tax years ending
15    after December 31, 1988, the credit shall be allowed for
16    the tax year in which the property is placed in service,
17    or, if the amount of the credit exceeds the tax liability
18    for that year, whether it exceeds the original liability or
19    the liability as later amended, such excess may be carried
20    forward and applied to the tax liability of the 5 taxable
21    years following the excess credit years. The credit shall
22    be applied to the earliest year for which there is a
23    liability. If there is credit from more than one tax year
24    that is available to offset a liability, earlier credit
25    shall be applied first.
26        (2) The term "qualified property" means property

 

 

HB5864- 34 -LRB100 21647 AXK 38878 b

1    which:
2            (A) is tangible, whether new or used, including
3        buildings and structural components of buildings and
4        signs that are real property, but not including land or
5        improvements to real property that are not a structural
6        component of a building such as landscaping, sewer
7        lines, local access roads, fencing, parking lots, and
8        other appurtenances;
9            (B) is depreciable pursuant to Section 167 of the
10        Internal Revenue Code, except that "3-year property"
11        as defined in Section 168(c)(2)(A) of that Code is not
12        eligible for the credit provided by this subsection
13        (e);
14            (C) is acquired by purchase as defined in Section
15        179(d) of the Internal Revenue Code;
16            (D) is used in Illinois by a taxpayer who is
17        primarily engaged in manufacturing, or in mining coal
18        or fluorite, or in retailing, or was placed in service
19        on or after July 1, 2006 in a River Edge Redevelopment
20        Zone established pursuant to the River Edge
21        Redevelopment Zone Act; and
22            (E) has not previously been used in Illinois in
23        such a manner and by such a person as would qualify for
24        the credit provided by this subsection (e) or
25        subsection (f).
26        (3) For purposes of this subsection (e),

 

 

HB5864- 35 -LRB100 21647 AXK 38878 b

1    "manufacturing" means the material staging and production
2    of tangible personal property by procedures commonly
3    regarded as manufacturing, processing, fabrication, or
4    assembling which changes some existing material into new
5    shapes, new qualities, or new combinations. For purposes of
6    this subsection (e) the term "mining" shall have the same
7    meaning as the term "mining" in Section 613(c) of the
8    Internal Revenue Code. For purposes of this subsection (e),
9    the term "retailing" means the sale of tangible personal
10    property for use or consumption and not for resale, or
11    services rendered in conjunction with the sale of tangible
12    personal property for use or consumption and not for
13    resale. For purposes of this subsection (e), "tangible
14    personal property" has the same meaning as when that term
15    is used in the Retailers' Occupation Tax Act, and, for
16    taxable years ending after December 31, 2008, does not
17    include the generation, transmission, or distribution of
18    electricity.
19        (4) The basis of qualified property shall be the basis
20    used to compute the depreciation deduction for federal
21    income tax purposes.
22        (5) If the basis of the property for federal income tax
23    depreciation purposes is increased after it has been placed
24    in service in Illinois by the taxpayer, the amount of such
25    increase shall be deemed property placed in service on the
26    date of such increase in basis.

 

 

HB5864- 36 -LRB100 21647 AXK 38878 b

1        (6) The term "placed in service" shall have the same
2    meaning as under Section 46 of the Internal Revenue Code.
3        (7) If during any taxable year, any property ceases to
4    be qualified property in the hands of the taxpayer within
5    48 months after being placed in service, or the situs of
6    any qualified property is moved outside Illinois within 48
7    months after being placed in service, the Personal Property
8    Tax Replacement Income Tax for such taxable year shall be
9    increased. Such increase shall be determined by (i)
10    recomputing the investment credit which would have been
11    allowed for the year in which credit for such property was
12    originally allowed by eliminating such property from such
13    computation and, (ii) subtracting such recomputed credit
14    from the amount of credit previously allowed. For the
15    purposes of this paragraph (7), a reduction of the basis of
16    qualified property resulting from a redetermination of the
17    purchase price shall be deemed a disposition of qualified
18    property to the extent of such reduction.
19        (8) Unless the investment credit is extended by law,
20    the basis of qualified property shall not include costs
21    incurred after December 31, 2018, except for costs incurred
22    pursuant to a binding contract entered into on or before
23    December 31, 2018.
24        (9) Each taxable year ending before December 31, 2000,
25    a partnership may elect to pass through to its partners the
26    credits to which the partnership is entitled under this

 

 

HB5864- 37 -LRB100 21647 AXK 38878 b

1    subsection (e) for the taxable year. A partner may use the
2    credit allocated to him or her under this paragraph only
3    against the tax imposed in subsections (c) and (d) of this
4    Section. If the partnership makes that election, those
5    credits shall be allocated among the partners in the
6    partnership in accordance with the rules set forth in
7    Section 704(b) of the Internal Revenue Code, and the rules
8    promulgated under that Section, and the allocated amount of
9    the credits shall be allowed to the partners for that
10    taxable year. The partnership shall make this election on
11    its Personal Property Tax Replacement Income Tax return for
12    that taxable year. The election to pass through the credits
13    shall be irrevocable.
14        For taxable years ending on or after December 31, 2000,
15    a partner that qualifies its partnership for a subtraction
16    under subparagraph (I) of paragraph (2) of subsection (d)
17    of Section 203 or a shareholder that qualifies a Subchapter
18    S corporation for a subtraction under subparagraph (S) of
19    paragraph (2) of subsection (b) of Section 203 shall be
20    allowed a credit under this subsection (e) equal to its
21    share of the credit earned under this subsection (e) during
22    the taxable year by the partnership or Subchapter S
23    corporation, determined in accordance with the
24    determination of income and distributive share of income
25    under Sections 702 and 704 and Subchapter S of the Internal
26    Revenue Code. This paragraph is exempt from the provisions

 

 

HB5864- 38 -LRB100 21647 AXK 38878 b

1    of Section 250.
2    (f) Investment credit; Enterprise Zone; River Edge
3Redevelopment Zone.
4        (1) A taxpayer shall be allowed a credit against the
5    tax imposed by subsections (a) and (b) of this Section for
6    investment in qualified property which is placed in service
7    in an Enterprise Zone created pursuant to the Illinois
8    Enterprise Zone Act or, for property placed in service on
9    or after July 1, 2006, a River Edge Redevelopment Zone
10    established pursuant to the River Edge Redevelopment Zone
11    Act. For partners, shareholders of Subchapter S
12    corporations, and owners of limited liability companies,
13    if the liability company is treated as a partnership for
14    purposes of federal and State income taxation, there shall
15    be allowed a credit under this subsection (f) to be
16    determined in accordance with the determination of income
17    and distributive share of income under Sections 702 and 704
18    and Subchapter S of the Internal Revenue Code. The credit
19    shall be .5% of the basis for such property. The credit
20    shall be available only in the taxable year in which the
21    property is placed in service in the Enterprise Zone or
22    River Edge Redevelopment Zone and shall not be allowed to
23    the extent that it would reduce a taxpayer's liability for
24    the tax imposed by subsections (a) and (b) of this Section
25    to below zero. For tax years ending on or after December
26    31, 1985, the credit shall be allowed for the tax year in

 

 

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1    which the property is placed in service, or, if the amount
2    of the credit exceeds the tax liability for that year,
3    whether it exceeds the original liability or the liability
4    as later amended, such excess may be carried forward and
5    applied to the tax liability of the 5 taxable years
6    following the excess credit year. The credit shall be
7    applied to the earliest year for which there is a
8    liability. If there is credit from more than one tax year
9    that is available to offset a liability, the credit
10    accruing first in time shall be applied first.
11        (2) The term qualified property means property which:
12            (A) is tangible, whether new or used, including
13        buildings and structural components of buildings;
14            (B) is depreciable pursuant to Section 167 of the
15        Internal Revenue Code, except that "3-year property"
16        as defined in Section 168(c)(2)(A) of that Code is not
17        eligible for the credit provided by this subsection
18        (f);
19            (C) is acquired by purchase as defined in Section
20        179(d) of the Internal Revenue Code;
21            (D) is used in the Enterprise Zone or River Edge
22        Redevelopment Zone by the taxpayer; and
23            (E) has not been previously used in Illinois in
24        such a manner and by such a person as would qualify for
25        the credit provided by this subsection (f) or
26        subsection (e).

 

 

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1        (3) The basis of qualified property shall be the basis
2    used to compute the depreciation deduction for federal
3    income tax purposes.
4        (4) If the basis of the property for federal income tax
5    depreciation purposes is increased after it has been placed
6    in service in the Enterprise Zone or River Edge
7    Redevelopment Zone by the taxpayer, the amount of such
8    increase shall be deemed property placed in service on the
9    date of such increase in basis.
10        (5) The term "placed in service" shall have the same
11    meaning as under Section 46 of the Internal Revenue Code.
12        (6) If during any taxable year, any property ceases to
13    be qualified property in the hands of the taxpayer within
14    48 months after being placed in service, or the situs of
15    any qualified property is moved outside the Enterprise Zone
16    or River Edge Redevelopment Zone within 48 months after
17    being placed in service, the tax imposed under subsections
18    (a) and (b) of this Section for such taxable year shall be
19    increased. Such increase shall be determined by (i)
20    recomputing the investment credit which would have been
21    allowed for the year in which credit for such property was
22    originally allowed by eliminating such property from such
23    computation, and (ii) subtracting such recomputed credit
24    from the amount of credit previously allowed. For the
25    purposes of this paragraph (6), a reduction of the basis of
26    qualified property resulting from a redetermination of the

 

 

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1    purchase price shall be deemed a disposition of qualified
2    property to the extent of such reduction.
3        (7) There shall be allowed an additional credit equal
4    to 0.5% of the basis of qualified property placed in
5    service during the taxable year in a River Edge
6    Redevelopment Zone, provided such property is placed in
7    service on or after July 1, 2006, and the taxpayer's base
8    employment within Illinois has increased by 1% or more over
9    the preceding year as determined by the taxpayer's
10    employment records filed with the Illinois Department of
11    Employment Security. Taxpayers who are new to Illinois
12    shall be deemed to have met the 1% growth in base
13    employment for the first year in which they file employment
14    records with the Illinois Department of Employment
15    Security. If, in any year, the increase in base employment
16    within Illinois over the preceding year is less than 1%,
17    the additional credit shall be limited to that percentage
18    times a fraction, the numerator of which is 0.5% and the
19    denominator of which is 1%, but shall not exceed 0.5%.
20        (8) For taxable years beginning on or after the
21    effective date of this amendatory Act of the 100th General
22    Assembly, there shall be allowed an Enterprise Zone
23    construction jobs credit against the taxes imposed under
24    subsections (a) and (b) of this Section as provided in
25    Section 13 of the Illinois Enterprise Zone Act.
26        The credit or credits may not reduce the taxpayer's

 

 

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1    liability to less than zero. If the amount of the credit or
2    credits exceeds the taxpayer's liability, the excess may be
3    carried forward and applied against the taxpayer's
4    liability in succeeding calendar years in the same manner
5    provided under paragraph (4) of Section 211 of this Act.
6    The credit or credits shall be applied to the earliest year
7    for which there is a tax liability. If there are credits
8    from more than one taxable year that are available to
9    offset a liability, the earlier credit shall be applied
10    first.
11        This paragraph (8) is exempt from the provisions of
12    Section 250.
13    (g) (Blank).
14    (h) Investment credit; High Impact Business.
15        (1) Subject to subsections (b) and (b-5) of Section 5.5
16    of the Illinois Enterprise Zone Act, a taxpayer shall be
17    allowed a credit against the tax imposed by subsections (a)
18    and (b) of this Section for investment in qualified
19    property which is placed in service by a Department of
20    Commerce and Economic Opportunity designated High Impact
21    Business. The credit shall be .5% of the basis for such
22    property. The credit shall not be available (i) until the
23    minimum investments in qualified property set forth in
24    subdivision (a)(3)(A) of Section 5.5 of the Illinois
25    Enterprise Zone Act have been satisfied or (ii) until the
26    time authorized in subsection (b-5) of the Illinois

 

 

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1    Enterprise Zone Act for entities designated as High Impact
2    Businesses under subdivisions (a)(3)(B), (a)(3)(C), and
3    (a)(3)(D) of Section 5.5 of the Illinois Enterprise Zone
4    Act, and shall not be allowed to the extent that it would
5    reduce a taxpayer's liability for the tax imposed by
6    subsections (a) and (b) of this Section to below zero. The
7    credit applicable to such investments shall be taken in the
8    taxable year in which such investments have been completed.
9    The credit for additional investments beyond the minimum
10    investment by a designated high impact business authorized
11    under subdivision (a)(3)(A) of Section 5.5 of the Illinois
12    Enterprise Zone Act shall be available only in the taxable
13    year in which the property is placed in service and shall
14    not be allowed to the extent that it would reduce a
15    taxpayer's liability for the tax imposed by subsections (a)
16    and (b) of this Section to below zero. For tax years ending
17    on or after December 31, 1987, the credit shall be allowed
18    for the tax year in which the property is placed in
19    service, or, if the amount of the credit exceeds the tax
20    liability for that year, whether it exceeds the original
21    liability or the liability as later amended, such excess
22    may be carried forward and applied to the tax liability of
23    the 5 taxable years following the excess credit year. The
24    credit shall be applied to the earliest year for which
25    there is a liability. If there is credit from more than one
26    tax year that is available to offset a liability, the

 

 

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1    credit accruing first in time shall be applied first.
2        Changes made in this subdivision (h)(1) by Public Act
3    88-670 restore changes made by Public Act 85-1182 and
4    reflect existing law.
5        (2) The term qualified property means property which:
6            (A) is tangible, whether new or used, including
7        buildings and structural components of buildings;
8            (B) is depreciable pursuant to Section 167 of the
9        Internal Revenue Code, except that "3-year property"
10        as defined in Section 168(c)(2)(A) of that Code is not
11        eligible for the credit provided by this subsection
12        (h);
13            (C) is acquired by purchase as defined in Section
14        179(d) of the Internal Revenue Code; and
15            (D) is not eligible for the Enterprise Zone
16        Investment Credit provided by subsection (f) of this
17        Section.
18        (3) The basis of qualified property shall be the basis
19    used to compute the depreciation deduction for federal
20    income tax purposes.
21        (4) If the basis of the property for federal income tax
22    depreciation purposes is increased after it has been placed
23    in service in a federally designated Foreign Trade Zone or
24    Sub-Zone located in Illinois by the taxpayer, the amount of
25    such increase shall be deemed property placed in service on
26    the date of such increase in basis.

 

 

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1        (5) The term "placed in service" shall have the same
2    meaning as under Section 46 of the Internal Revenue Code.
3        (6) If during any taxable year ending on or before
4    December 31, 1996, any property ceases to be qualified
5    property in the hands of the taxpayer within 48 months
6    after being placed in service, or the situs of any
7    qualified property is moved outside Illinois within 48
8    months after being placed in service, the tax imposed under
9    subsections (a) and (b) of this Section for such taxable
10    year shall be increased. Such increase shall be determined
11    by (i) recomputing the investment credit which would have
12    been allowed for the year in which credit for such property
13    was originally allowed by eliminating such property from
14    such computation, and (ii) subtracting such recomputed
15    credit from the amount of credit previously allowed. For
16    the purposes of this paragraph (6), a reduction of the
17    basis of qualified property resulting from a
18    redetermination of the purchase price shall be deemed a
19    disposition of qualified property to the extent of such
20    reduction.
21        (7) Beginning with tax years ending after December 31,
22    1996, if a taxpayer qualifies for the credit under this
23    subsection (h) and thereby is granted a tax abatement and
24    the taxpayer relocates its entire facility in violation of
25    the explicit terms and length of the contract under Section
26    18-183 of the Property Tax Code, the tax imposed under

 

 

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1    subsections (a) and (b) of this Section shall be increased
2    for the taxable year in which the taxpayer relocated its
3    facility by an amount equal to the amount of credit
4    received by the taxpayer under this subsection (h).
5    (h-5) High Impact Business constructions jobs credit. For
6taxable years beginning on or after the effective date of this
7amendatory act of the 100th General Assembly, there shall also
8be allowed a High Impact Business construction jobs credit
9against the tax imposed under subsections (a) and (b) of this
10Section as provided in subsections (i) and (j) of Section 5.5
11of the Illinois Enterprise Zone Act.
12    The credit or credits may not reduce the taxpayer's
13liability to less than zero. If the amount of the credit or
14credits exceeds the taxpayer's liability, the excess may be
15carried forward and applied against the taxpayer's liability in
16succeeding calendar years in the manner provided under
17paragraph (4) of Section 211 of this Act. The credit or credits
18shall be applied to the earliest year for which there is a tax
19liability. If there are credits from more than one taxable year
20that are available to offset a liability, the earlier credit
21shall be applied first.
22    This subsection (h-5) is exempt from the provisions of
23Section 250.
24    (i) Credit for Personal Property Tax Replacement Income
25Tax. For tax years ending prior to December 31, 2003, a credit
26shall be allowed against the tax imposed by subsections (a) and

 

 

HB5864- 47 -LRB100 21647 AXK 38878 b

1(b) of this Section for the tax imposed by subsections (c) and
2(d) of this Section. This credit shall be computed by
3multiplying the tax imposed by subsections (c) and (d) of this
4Section by a fraction, the numerator of which is base income
5allocable to Illinois and the denominator of which is Illinois
6base income, and further multiplying the product by the tax
7rate imposed by subsections (a) and (b) of this Section.
8    Any credit earned on or after December 31, 1986 under this
9subsection which is unused in the year the credit is computed
10because it exceeds the tax liability imposed by subsections (a)
11and (b) for that year (whether it exceeds the original
12liability or the liability as later amended) may be carried
13forward and applied to the tax liability imposed by subsections
14(a) and (b) of the 5 taxable years following the excess credit
15year, provided that no credit may be carried forward to any
16year ending on or after December 31, 2003. This credit shall be
17applied first to the earliest year for which there is a
18liability. If there is a credit under this subsection from more
19than one tax year that is available to offset a liability the
20earliest credit arising under this subsection shall be applied
21first.
22    If, during any taxable year ending on or after December 31,
231986, the tax imposed by subsections (c) and (d) of this
24Section for which a taxpayer has claimed a credit under this
25subsection (i) is reduced, the amount of credit for such tax
26shall also be reduced. Such reduction shall be determined by

 

 

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1recomputing the credit to take into account the reduced tax
2imposed by subsections (c) and (d). If any portion of the
3reduced amount of credit has been carried to a different
4taxable year, an amended return shall be filed for such taxable
5year to reduce the amount of credit claimed.
6    (j) Training expense credit. Beginning with tax years
7ending on or after December 31, 1986 and prior to December 31,
82003, a taxpayer shall be allowed a credit against the tax
9imposed by subsections (a) and (b) under this Section for all
10amounts paid or accrued, on behalf of all persons employed by
11the taxpayer in Illinois or Illinois residents employed outside
12of Illinois by a taxpayer, for educational or vocational
13training in semi-technical or technical fields or semi-skilled
14or skilled fields, which were deducted from gross income in the
15computation of taxable income. The credit against the tax
16imposed by subsections (a) and (b) shall be 1.6% of such
17training expenses. For partners, shareholders of subchapter S
18corporations, and owners of limited liability companies, if the
19liability company is treated as a partnership for purposes of
20federal and State income taxation, there shall be allowed a
21credit under this subsection (j) to be determined in accordance
22with the determination of income and distributive share of
23income under Sections 702 and 704 and subchapter S of the
24Internal Revenue Code.
25    Any credit allowed under this subsection which is unused in
26the year the credit is earned may be carried forward to each of

 

 

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1the 5 taxable years following the year for which the credit is
2first computed until it is used. This credit shall be applied
3first to the earliest year for which there is a liability. If
4there is a credit under this subsection from more than one tax
5year that is available to offset a liability the earliest
6credit arising under this subsection shall be applied first. No
7carryforward credit may be claimed in any tax year ending on or
8after December 31, 2003.
9    (k) Research and development credit. For tax years ending
10after July 1, 1990 and prior to December 31, 2003, and
11beginning again for tax years ending on or after December 31,
122004, and ending prior to January 1, 2022, a taxpayer shall be
13allowed a credit against the tax imposed by subsections (a) and
14(b) of this Section for increasing research activities in this
15State. The credit allowed against the tax imposed by
16subsections (a) and (b) shall be equal to 6 1/2% of the
17qualifying expenditures for increasing research activities in
18this State. For partners, shareholders of subchapter S
19corporations, and owners of limited liability companies, if the
20liability company is treated as a partnership for purposes of
21federal and State income taxation, there shall be allowed a
22credit under this subsection to be determined in accordance
23with the determination of income and distributive share of
24income under Sections 702 and 704 and subchapter S of the
25Internal Revenue Code.
26    For purposes of this subsection, "qualifying expenditures"

 

 

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1means the qualifying expenditures as defined for the federal
2credit for increasing research activities which would be
3allowable under Section 41 of the Internal Revenue Code and
4which are conducted in this State, "qualifying expenditures for
5increasing research activities in this State" means the excess
6of qualifying expenditures for the taxable year in which
7incurred over qualifying expenditures for the base period,
8"qualifying expenditures for the base period" means the average
9of the qualifying expenditures for each year in the base
10period, and "base period" means the 3 taxable years immediately
11preceding the taxable year for which the determination is being
12made.
13    Any credit in excess of the tax liability for the taxable
14year may be carried forward. A taxpayer may elect to have the
15unused credit shown on its final completed return carried over
16as a credit against the tax liability for the following 5
17taxable years or until it has been fully used, whichever occurs
18first; provided that no credit earned in a tax year ending
19prior to December 31, 2003 may be carried forward to any year
20ending on or after December 31, 2003.
21    If an unused credit is carried forward to a given year from
222 or more earlier years, that credit arising in the earliest
23year will be applied first against the tax liability for the
24given year. If a tax liability for the given year still
25remains, the credit from the next earliest year will then be
26applied, and so on, until all credits have been used or no tax

 

 

HB5864- 51 -LRB100 21647 AXK 38878 b

1liability for the given year remains. Any remaining unused
2credit or credits then will be carried forward to the next
3following year in which a tax liability is incurred, except
4that no credit can be carried forward to a year which is more
5than 5 years after the year in which the expense for which the
6credit is given was incurred.
7    No inference shall be drawn from this amendatory Act of the
891st General Assembly in construing this Section for taxable
9years beginning before January 1, 1999.
10    It is the intent of the General Assembly that the research
11and development credit under this subsection (k) shall apply
12continuously for all tax years ending on or after December 31,
132004 and ending prior to January 1, 2022, including, but not
14limited to, the period beginning on January 1, 2016 and ending
15on the effective date of this amendatory Act of the 100th
16General Assembly. All actions taken in reliance on the
17continuation of the credit under this subsection (k) by any
18taxpayer are hereby validated.
19    (l) Environmental Remediation Tax Credit.
20        (i) For tax years ending after December 31, 1997 and on
21    or before December 31, 2001, a taxpayer shall be allowed a
22    credit against the tax imposed by subsections (a) and (b)
23    of this Section for certain amounts paid for unreimbursed
24    eligible remediation costs, as specified in this
25    subsection. For purposes of this Section, "unreimbursed
26    eligible remediation costs" means costs approved by the

 

 

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1    Illinois Environmental Protection Agency ("Agency") under
2    Section 58.14 of the Environmental Protection Act that were
3    paid in performing environmental remediation at a site for
4    which a No Further Remediation Letter was issued by the
5    Agency and recorded under Section 58.10 of the
6    Environmental Protection Act. The credit must be claimed
7    for the taxable year in which Agency approval of the
8    eligible remediation costs is granted. The credit is not
9    available to any taxpayer if the taxpayer or any related
10    party caused or contributed to, in any material respect, a
11    release of regulated substances on, in, or under the site
12    that was identified and addressed by the remedial action
13    pursuant to the Site Remediation Program of the
14    Environmental Protection Act. After the Pollution Control
15    Board rules are adopted pursuant to the Illinois
16    Administrative Procedure Act for the administration and
17    enforcement of Section 58.9 of the Environmental
18    Protection Act, determinations as to credit availability
19    for purposes of this Section shall be made consistent with
20    those rules. For purposes of this Section, "taxpayer"
21    includes a person whose tax attributes the taxpayer has
22    succeeded to under Section 381 of the Internal Revenue Code
23    and "related party" includes the persons disallowed a
24    deduction for losses by paragraphs (b), (c), and (f)(1) of
25    Section 267 of the Internal Revenue Code by virtue of being
26    a related taxpayer, as well as any of its partners. The

 

 

HB5864- 53 -LRB100 21647 AXK 38878 b

1    credit allowed against the tax imposed by subsections (a)
2    and (b) shall be equal to 25% of the unreimbursed eligible
3    remediation costs in excess of $100,000 per site, except
4    that the $100,000 threshold shall not apply to any site
5    contained in an enterprise zone as determined by the
6    Department of Commerce and Community Affairs (now
7    Department of Commerce and Economic Opportunity). The
8    total credit allowed shall not exceed $40,000 per year with
9    a maximum total of $150,000 per site. For partners and
10    shareholders of subchapter S corporations, there shall be
11    allowed a credit under this subsection to be determined in
12    accordance with the determination of income and
13    distributive share of income under Sections 702 and 704 and
14    subchapter S of the Internal Revenue Code.
15        (ii) A credit allowed under this subsection that is
16    unused in the year the credit is earned may be carried
17    forward to each of the 5 taxable years following the year
18    for which the credit is first earned until it is used. The
19    term "unused credit" does not include any amounts of
20    unreimbursed eligible remediation costs in excess of the
21    maximum credit per site authorized under paragraph (i).
22    This credit shall be applied first to the earliest year for
23    which there is a liability. If there is a credit under this
24    subsection from more than one tax year that is available to
25    offset a liability, the earliest credit arising under this
26    subsection shall be applied first. A credit allowed under

 

 

HB5864- 54 -LRB100 21647 AXK 38878 b

1    this subsection may be sold to a buyer as part of a sale of
2    all or part of the remediation site for which the credit
3    was granted. The purchaser of a remediation site and the
4    tax credit shall succeed to the unused credit and remaining
5    carry-forward period of the seller. To perfect the
6    transfer, the assignor shall record the transfer in the
7    chain of title for the site and provide written notice to
8    the Director of the Illinois Department of Revenue of the
9    assignor's intent to sell the remediation site and the
10    amount of the tax credit to be transferred as a portion of
11    the sale. In no event may a credit be transferred to any
12    taxpayer if the taxpayer or a related party would not be
13    eligible under the provisions of subsection (i).
14        (iii) For purposes of this Section, the term "site"
15    shall have the same meaning as under Section 58.2 of the
16    Environmental Protection Act.
17    (m) Education expense credit. Beginning with tax years
18ending after December 31, 1999, a taxpayer who is the custodian
19of one or more qualifying pupils shall be allowed a credit
20against the tax imposed by subsections (a) and (b) of this
21Section for qualified education expenses incurred on behalf of
22the qualifying pupils. The credit shall be equal to 25% of
23qualified education expenses, but in no event may the total
24credit under this subsection claimed by a family that is the
25custodian of qualifying pupils exceed (i) $500 for tax years
26ending prior to December 31, 2017, and (ii) $750 for tax years

 

 

HB5864- 55 -LRB100 21647 AXK 38878 b

1ending on or after December 31, 2017. In no event shall a
2credit under this subsection reduce the taxpayer's liability
3under this Act to less than zero. Notwithstanding any other
4provision of law, for taxable years beginning on or after
5January 1, 2017, no taxpayer may claim a credit under this
6subsection (m) if the taxpayer's adjusted gross income for the
7taxable year exceeds (i) $500,000, in the case of spouses
8filing a joint federal tax return or (ii) $250,000, in the case
9of all other taxpayers. This subsection is exempt from the
10provisions of Section 250 of this Act.
11    For purposes of this subsection:
12    "Qualifying pupils" means individuals who (i) are
13residents of the State of Illinois, (ii) are under the age of
1421 at the close of the school year for which a credit is
15sought, and (iii) during the school year for which a credit is
16sought were full-time pupils enrolled in a kindergarten through
17twelfth grade education program at any school, as defined in
18this subsection.
19    "Qualified education expense" means the amount incurred on
20behalf of a qualifying pupil in excess of $250 for tuition,
21book fees, and lab fees at the school in which the pupil is
22enrolled during the regular school year.
23    "School" means any public or nonpublic elementary or
24secondary school in Illinois that is in compliance with Title
25VI of the Civil Rights Act of 1964 and attendance at which
26satisfies the requirements of Section 26-1 of the School Code,

 

 

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1except that nothing shall be construed to require a child to
2attend any particular public or nonpublic school to qualify for
3the credit under this Section.
4    "Custodian" means, with respect to qualifying pupils, an
5Illinois resident who is a parent, the parents, a legal
6guardian, or the legal guardians of the qualifying pupils.
7    (n) River Edge Redevelopment Zone site remediation tax
8credit.
9        (i) For tax years ending on or after December 31, 2006,
10    a taxpayer shall be allowed a credit against the tax
11    imposed by subsections (a) and (b) of this Section for
12    certain amounts paid for unreimbursed eligible remediation
13    costs, as specified in this subsection. For purposes of
14    this Section, "unreimbursed eligible remediation costs"
15    means costs approved by the Illinois Environmental
16    Protection Agency ("Agency") under Section 58.14a of the
17    Environmental Protection Act that were paid in performing
18    environmental remediation at a site within a River Edge
19    Redevelopment Zone for which a No Further Remediation
20    Letter was issued by the Agency and recorded under Section
21    58.10 of the Environmental Protection Act. The credit must
22    be claimed for the taxable year in which Agency approval of
23    the eligible remediation costs is granted. The credit is
24    not available to any taxpayer if the taxpayer or any
25    related party caused or contributed to, in any material
26    respect, a release of regulated substances on, in, or under

 

 

HB5864- 57 -LRB100 21647 AXK 38878 b

1    the site that was identified and addressed by the remedial
2    action pursuant to the Site Remediation Program of the
3    Environmental Protection Act. Determinations as to credit
4    availability for purposes of this Section shall be made
5    consistent with rules adopted by the Pollution Control
6    Board pursuant to the Illinois Administrative Procedure
7    Act for the administration and enforcement of Section 58.9
8    of the Environmental Protection Act. For purposes of this
9    Section, "taxpayer" includes a person whose tax attributes
10    the taxpayer has succeeded to under Section 381 of the
11    Internal Revenue Code and "related party" includes the
12    persons disallowed a deduction for losses by paragraphs
13    (b), (c), and (f)(1) of Section 267 of the Internal Revenue
14    Code by virtue of being a related taxpayer, as well as any
15    of its partners. The credit allowed against the tax imposed
16    by subsections (a) and (b) shall be equal to 25% of the
17    unreimbursed eligible remediation costs in excess of
18    $100,000 per site.
19        (ii) A credit allowed under this subsection that is
20    unused in the year the credit is earned may be carried
21    forward to each of the 5 taxable years following the year
22    for which the credit is first earned until it is used. This
23    credit shall be applied first to the earliest year for
24    which there is a liability. If there is a credit under this
25    subsection from more than one tax year that is available to
26    offset a liability, the earliest credit arising under this

 

 

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1    subsection shall be applied first. A credit allowed under
2    this subsection may be sold to a buyer as part of a sale of
3    all or part of the remediation site for which the credit
4    was granted. The purchaser of a remediation site and the
5    tax credit shall succeed to the unused credit and remaining
6    carry-forward period of the seller. To perfect the
7    transfer, the assignor shall record the transfer in the
8    chain of title for the site and provide written notice to
9    the Director of the Illinois Department of Revenue of the
10    assignor's intent to sell the remediation site and the
11    amount of the tax credit to be transferred as a portion of
12    the sale. In no event may a credit be transferred to any
13    taxpayer if the taxpayer or a related party would not be
14    eligible under the provisions of subsection (i).
15        (iii) For purposes of this Section, the term "site"
16    shall have the same meaning as under Section 58.2 of the
17    Environmental Protection Act.
18    (o) For each of taxable years during the Compassionate Use
19of Medical Cannabis Pilot Program, a surcharge is imposed on
20all taxpayers on income arising from the sale or exchange of
21capital assets, depreciable business property, real property
22used in the trade or business, and Section 197 intangibles of
23an organization registrant under the Compassionate Use of
24Medical Cannabis Pilot Program Act. The amount of the surcharge
25is equal to the amount of federal income tax liability for the
26taxable year attributable to those sales and exchanges. The

 

 

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1surcharge imposed does not apply if:
2        (1) the medical cannabis cultivation center
3    registration, medical cannabis dispensary registration, or
4    the property of a registration is transferred as a result
5    of any of the following:
6            (A) bankruptcy, a receivership, or a debt
7        adjustment initiated by or against the initial
8        registration or the substantial owners of the initial
9        registration;
10            (B) cancellation, revocation, or termination of
11        any registration by the Illinois Department of Public
12        Health;
13            (C) a determination by the Illinois Department of
14        Public Health that transfer of the registration is in
15        the best interests of Illinois qualifying patients as
16        defined by the Compassionate Use of Medical Cannabis
17        Pilot Program Act;
18            (D) the death of an owner of the equity interest in
19        a registrant;
20            (E) the acquisition of a controlling interest in
21        the stock or substantially all of the assets of a
22        publicly traded company;
23            (F) a transfer by a parent company to a wholly
24        owned subsidiary; or
25            (G) the transfer or sale to or by one person to
26        another person where both persons were initial owners

 

 

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1        of the registration when the registration was issued;
2        or
3        (2) the cannabis cultivation center registration,
4    medical cannabis dispensary registration, or the
5    controlling interest in a registrant's property is
6    transferred in a transaction to lineal descendants in which
7    no gain or loss is recognized or as a result of a
8    transaction in accordance with Section 351 of the Internal
9    Revenue Code in which no gain or loss is recognized.
10(Source: P.A. 100-22, eff. 7-6-17.)
 
11    (35 ILCS 5/211)
12    Sec. 211. Economic Development for a Growing Economy Tax
13Credit. For tax years beginning on or after January 1, 1999, a
14Taxpayer who has entered into an Agreement (including a New
15Construction EDGE Agreement) under the Economic Development
16for a Growing Economy Tax Credit Act is entitled to a credit
17against the taxes imposed under subsections (a) and (b) of
18Section 201 of this Act in an amount to be determined in the
19Agreement. If the Taxpayer is a partnership or Subchapter S
20corporation, the credit shall be allowed to the partners or
21shareholders in accordance with the determination of income and
22distributive share of income under Sections 702 and 704 and
23subchapter S of the Internal Revenue Code. The Department, in
24cooperation with the Department of Commerce and Economic
25Opportunity, shall prescribe rules to enforce and administer

 

 

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1the provisions of this Section. This Section is exempt from the
2provisions of Section 250 of this Act.
3    The credit shall be subject to the conditions set forth in
4the Agreement and the following limitations:
5        (1) The tax credit shall not exceed the Incremental
6    Income Tax (as defined in Section 5-5 of the Economic
7    Development for a Growing Economy Tax Credit Act) with
8    respect to the project; additionally, the New Construction
9    EDGE Credit shall not exceed the New Construction EDGE
10    Incremental Income Tax (as defined in Section 5-5 of the
11    Economic Development for a Growing Economy Tax Credit Act).
12        (2) The amount of the credit allowed during the tax
13    year plus the sum of all amounts allowed in prior years
14    shall not exceed 100% of the aggregate amount expended by
15    the Taxpayer during all prior tax years on approved costs
16    defined by Agreement.
17        (3) The amount of the credit shall be determined on an
18    annual basis. Except as applied in a carryover year
19    pursuant to Section 211(4) of this Act, the credit may not
20    be applied against any State income tax liability in more
21    than 10 taxable years; provided, however, that (i) an
22    eligible business certified by the Department of Commerce
23    and Economic Opportunity under the Corporate Headquarters
24    Relocation Act may not apply the credit against any of its
25    State income tax liability in more than 15 taxable years
26    and (ii) credits allowed to that eligible business are

 

 

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1    subject to the conditions and requirements set forth in
2    Sections 5-35 and 5-45 of the Economic Development for a
3    Growing Economy Tax Credit Act and Section 5-51 as
4    applicable to New Construction EDGE Credits.
5        (4) The credit may not exceed the amount of taxes
6    imposed pursuant to subsections (a) and (b) of Section 201
7    of this Act. Any credit that is unused in the year the
8    credit is computed may be carried forward and applied to
9    the tax liability of the 5 taxable years following the
10    excess credit year. The credit shall be applied to the
11    earliest year for which there is a tax liability. If there
12    are credits from more than one tax year that are available
13    to offset a liability, the earlier credit shall be applied
14    first.
15        (5) No credit shall be allowed with respect to any
16    Agreement for any taxable year ending after the
17    Noncompliance Date. Upon receiving notification by the
18    Department of Commerce and Economic Opportunity of the
19    noncompliance of a Taxpayer with an Agreement, the
20    Department shall notify the Taxpayer that no credit is
21    allowed with respect to that Agreement for any taxable year
22    ending after the Noncompliance Date, as stated in such
23    notification. If any credit has been allowed with respect
24    to an Agreement for a taxable year ending after the
25    Noncompliance Date for that Agreement, any refund paid to
26    the Taxpayer for that taxable year shall, to the extent of

 

 

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1    that credit allowed, be an erroneous refund within the
2    meaning of Section 912 of this Act.
3        (6) For purposes of this Section, the terms
4    "Agreement", "Incremental Income Tax", "New Construction
5    EDGE Agreement", "New Construction EDGE Credit", "New
6    Construction EDGE Incremental Income Tax", and
7    "Noncompliance Date" have the same meaning as when used in
8    the Economic Development for a Growing Economy Tax Credit
9    Act.
10(Source: P.A. 94-793, eff. 5-19-06.)
 
11    (35 ILCS 5/221)
12    Sec. 221. Rehabilitation costs; qualified historic
13properties; River Edge Redevelopment Zone.
14    (a) For taxable years beginning on or after January 1, 2012
15and ending prior to January 1, 2022, there shall be allowed a
16tax credit against the tax imposed by subsections (a) and (b)
17of Section 201 in an amount equal to 25% of qualified
18expenditures incurred by a qualified taxpayer during the
19taxable year in the restoration and preservation of a qualified
20historic structure located in a River Edge Redevelopment Zone
21pursuant to a qualified rehabilitation plan, provided that the
22total amount of such expenditures (i) must equal $5,000 or more
23and (ii) must exceed 50% of the purchase price of the property.
24    (a-1) For taxable years beginning on or after the effective
25date of this amendatory act of the 100th General Assembly and

 

 

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1ending prior to January 1, 2022, there shall be allowed a tax
2credit against the tax imposed by subsections (a) and (b) of
3Section 201 as provided in Section 10-10.3 of the River Edge
4Redevelopment Zone Act. The credit allowed under this
5subsection (a-1) shall apply only to taxpayers that make a
6capital investment of at least $1,000,000 in a qualified
7rehabilitation plan.
8    The credit or credits may not reduce the taxpayer's
9liability to less than zero. If the amount of the credit or
10credits exceeds the taxpayer's liability, the excess may be
11carried forward and applied against the taxpayer's liability in
12succeeding calendar years in the manner provided under
13paragraph (4) of Section 211 of this Act. The credit or credits
14shall be applied to the earliest year for which there is a tax
15liability. If there are credits from more than one taxable year
16that are available to offset a liability, the earlier credit
17shall be applied first.
18    (b) To obtain a tax credit pursuant to this Section, the
19taxpayer must apply with the Department of Commerce and
20Economic Opportunity. The Department of Commerce and Economic
21Opportunity, in consultation with the Historic Preservation
22Agency, shall determine the amount of eligible rehabilitation
23costs and expenses in addition to the amount of the River Edge
24construction jobs credit. The Historic Preservation Agency
25shall determine whether the rehabilitation is consistent with
26the standards of the Secretary of the United States Department

 

 

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1of the Interior for rehabilitation. Upon completion and review
2of the project, the Department of Commerce and Economic
3Opportunity shall issue a certificate in the amount of the
4eligible credits. At the time the certificate is issued, an
5issuance fee up to the maximum amount of 2% of the amount of
6the credits issued by the certificate may be collected from the
7applicant to administer the provisions of this Section. If
8collected, this issuance fee shall be deposited into the
9Historic Property Administrative Fund, a special fund created
10in the State treasury. Subject to appropriation, moneys in the
11Historic Property Administrative Fund shall be evenly divided
12between the Department of Commerce and Economic Opportunity and
13the Historic Preservation Agency to reimburse the Department of
14Commerce and Economic Opportunity and the Historic
15Preservation Agency for the costs associated with
16administering this Section. The taxpayer must attach the
17certificate to the tax return on which the credits are to be
18claimed. The Department of Commerce and Economic Opportunity
19may adopt rules to implement this Section.
20    (c) The tax credit under this Section may not reduce the
21taxpayer's liability to less than zero.
22    (d) As used in this Section, the following terms have the
23following meanings.
24    "Qualified expenditure" means all the costs and expenses
25defined as qualified rehabilitation expenditures under Section
2647 of the federal Internal Revenue Code that were incurred in

 

 

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1connection with a qualified historic structure.
2    "Qualified historic structure" means a certified historic
3structure as defined under Section 47(c)(3) of the federal
4Internal Revenue Code.
5    "Qualified rehabilitation plan" means a project that is
6approved by the Historic Preservation Agency as being
7consistent with the standards in effect on the effective date
8of this amendatory Act of the 97th General Assembly for
9rehabilitation as adopted by the federal Secretary of the
10Interior.
11    "Qualified taxpayer" means the owner of the qualified
12historic structure or any other person who qualifies for the
13federal rehabilitation credit allowed by Section 47 of the
14federal Internal Revenue Code with respect to that qualified
15historic structure. Partners, shareholders of subchapter S
16corporations, and owners of limited liability companies (if the
17limited liability company is treated as a partnership for
18purposes of federal and State income taxation) are entitled to
19a credit under this Section to be determined in accordance with
20the determination of income and distributive share of income
21under Sections 702 and 703 and subchapter S of the Internal
22Revenue Code, provided that credits granted to a partnership, a
23limited liability company taxed as a partnership, or other
24multiple owners of property shall be passed through to the
25partners, members, or owners respectively on a pro rata basis
26or pursuant to an executed agreement among the partners,

 

 

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1members, or owners documenting any alternate distribution
2method.
3(Source: P.A. 99-914, eff. 12-20-16; 100-236, eff. 8-18-17.)
 
4    Section 15. The Economic Development for a Growing Economy
5Tax Credit Act is amended by changing Section 5-5 and by adding
6Sections 5-51 and 5-56 as follows:
 
7    (35 ILCS 10/5-5)
8    Sec. 5-5. Definitions. As used in this Act:
9    "Agreement" means the Agreement between a Taxpayer and the
10Department under the provisions of Section 5-50 of this Act.
11    "Applicant" means a Taxpayer that is operating a business
12located or that the Taxpayer plans to locate within the State
13of Illinois and that is engaged in interstate or intrastate
14commerce for the purpose of manufacturing, processing,
15assembling, warehousing, or distributing products, conducting
16research and development, providing tourism services, or
17providing services in interstate commerce, office industries,
18or agricultural processing, but excluding retail, retail food,
19health, or professional services. "Applicant" does not include
20a Taxpayer who closes or substantially reduces an operation at
21one location in the State and relocates substantially the same
22operation to another location in the State. This does not
23prohibit a Taxpayer from expanding its operations at another
24location in the State, provided that existing operations of a

 

 

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1similar nature located within the State are not closed or
2substantially reduced. This also does not prohibit a Taxpayer
3from moving its operations from one location in the State to
4another location in the State for the purpose of expanding the
5operation provided that the Department determines that
6expansion cannot reasonably be accommodated within the
7municipality in which the business is located, or in the case
8of a business located in an incorporated area of the county,
9within the county in which the business is located, after
10conferring with the chief elected official of the municipality
11or county and taking into consideration any evidence offered by
12the municipality or county regarding the ability to accommodate
13expansion within the municipality or county.
14    "Committee" means the Illinois Business Investment
15Committee created under Section 5-25 of this Act within the
16Illinois Economic Development Board.
17    "Credit" means the amount agreed to between the Department
18and Applicant under this Act, but not to exceed the lesser of:
19(1) the sum of (i) 50% of the Incremental Income Tax
20attributable to New Employees at the Applicant's project and
21(ii) 10% of the training costs of New Employees; or (2) 100% of
22the Incremental Income Tax attributable to New Employees at the
23Applicant's project. However, if the project is located in an
24underserved area, then the amount of the Credit may not exceed
25the lesser of: (1) the sum of (i) 75% of the Incremental Income
26Tax attributable to New Employees at the Applicant's project

 

 

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1and (ii) 10% of the training costs of New Employees; or (2)
2100% of the Incremental Income Tax attributable to New
3Employees at the Applicant's project. If an Applicant agrees to
4hire the required number of New Employees, then the maximum
5amount of the Credit for that Applicant may be increased by an
6amount not to exceed 25% of the Incremental Income Tax
7attributable to retained employees at the Applicant's project;
8provided that, in order to receive the increase for retained
9employees, the Applicant must provide the additional evidence
10required under paragraph (3) of subsection (b) of Section 5-25.
11    "Department" means the Department of Commerce and Economic
12Opportunity.
13    "Director" means the Director of Commerce and Economic
14Opportunity.
15    "Full-time Employee" means an individual who is employed
16for consideration for at least 35 hours each week or who
17renders any other standard of service generally accepted by
18industry custom or practice as full-time employment. An
19individual for whom a W-2 is issued by a Professional Employer
20Organization (PEO) is a full-time employee if employed in the
21service of the Applicant for consideration for at least 35
22hours each week or who renders any other standard of service
23generally accepted by industry custom or practice as full-time
24employment to Applicant.
25    "Incremental Income Tax" means the total amount withheld
26during the taxable year from the compensation of New Employees

 

 

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1and, if applicable, retained employees under Article 7 of the
2Illinois Income Tax Act arising from employment at a project
3that is the subject of an Agreement.
4    "New Construction EDGE Agreement" means the Agreement
5between a Taxpayer and the Department under the provisions of
6Section 5-51 of this Act.
7    "New Construction EDGE Credit" means an amount agreed to
8between the Department and the Applicant under this Act as part
9of a New Construction EDGE Agreement that does not exceed 50%
10of the Incremental Income Tax attributable to New Construction
11EDGE Employees at the Applicant's project; however, if the New
12Construction EDGE Project is located in an underserved area,
13then the amount of the New Construction EDGE Credit may not
14exceed 75% of the Incremental Income Tax attributable to New
15Construction EDGE Employees at the Applicant's New
16Construction EDGE Project.
17    "New Construction EDGE Employee" means a laborer or worker
18who is employed by an Illinois contractor or subcontractor in
19the actual construction work on the site of a New Construction
20EDGE Project, pursuant to a New Construction EDGE Agreement.
21    "New Construction EDGE Incremental Income Tax" means the
22total amount withheld during the taxable year from the
23compensation of New Construction EDGE Employees.
24    "New Construction EDGE Project" means the building of a
25Taxpayer's structure or building, or making improvements of any
26kind to real property. "New Construction EDGE Project" does not

 

 

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1include the routine operation, routine repair, or routine
2maintenance of existing structures, buildings, or real
3property.
4    "New Employee" means:
5        (a) A Full-time Employee first employed by a Taxpayer
6    in the project that is the subject of an Agreement and who
7    is hired after the Taxpayer enters into the tax credit
8    Agreement.
9        (b) The term "New Employee" does not include:
10            (1) an employee of the Taxpayer who performs a job
11        that was previously performed by another employee, if
12        that job existed for at least 6 months before hiring
13        the employee;
14            (2) an employee of the Taxpayer who was previously
15        employed in Illinois by a Related Member of the
16        Taxpayer and whose employment was shifted to the
17        Taxpayer after the Taxpayer entered into the tax credit
18        Agreement; or
19            (3) a child, grandchild, parent, or spouse, other
20        than a spouse who is legally separated from the
21        individual, of any individual who has a direct or an
22        indirect ownership interest of at least 5% in the
23        profits, capital, or value of the Taxpayer.
24        (c) Notwithstanding paragraph (1) of subsection (b),
25    an employee may be considered a New Employee under the
26    Agreement if the employee performs a job that was

 

 

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1    previously performed by an employee who was:
2            (1) treated under the Agreement as a New Employee;
3        and
4            (2) promoted by the Taxpayer to another job.
5        (d) Notwithstanding subsection (a), the Department may
6    award Credit to an Applicant with respect to an employee
7    hired prior to the date of the Agreement if:
8            (1) the Applicant is in receipt of a letter from
9        the Department stating an intent to enter into a credit
10        Agreement;
11            (2) the letter described in paragraph (1) is issued
12        by the Department not later than 15 days after the
13        effective date of this Act; and
14            (3) the employee was hired after the date the
15        letter described in paragraph (1) was issued.
16    "Noncompliance Date" means, in the case of a Taxpayer that
17is not complying with the requirements of the Agreement or the
18provisions of this Act, the day following the last date upon
19which the Taxpayer was in compliance with the requirements of
20the Agreement and the provisions of this Act, as determined by
21the Director, pursuant to Section 5-65.
22    "Pass Through Entity" means an entity that is exempt from
23the tax under subsection (b) or (c) of Section 205 of the
24Illinois Income Tax Act.
25    "Professional Employer Organization" (PEO) means an
26employee leasing company, as defined in Section 206.1(A)(2) of

 

 

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1the Illinois Unemployment Insurance Act.
2    "Related Member" means a person that, with respect to the
3Taxpayer during any portion of the taxable year, is any one of
4the following:
5        (1) An individual stockholder, if the stockholder and
6    the members of the stockholder's family (as defined in
7    Section 318 of the Internal Revenue Code) own directly,
8    indirectly, beneficially, or constructively, in the
9    aggregate, at least 50% of the value of the Taxpayer's
10    outstanding stock.
11        (2) A partnership, estate, or trust and any partner or
12    beneficiary, if the partnership, estate, or trust, and its
13    partners or beneficiaries own directly, indirectly,
14    beneficially, or constructively, in the aggregate, at
15    least 50% of the profits, capital, stock, or value of the
16    Taxpayer.
17        (3) A corporation, and any party related to the
18    corporation in a manner that would require an attribution
19    of stock from the corporation to the party or from the
20    party to the corporation under the attribution rules of
21    Section 318 of the Internal Revenue Code, if the Taxpayer
22    owns directly, indirectly, beneficially, or constructively
23    at least 50% of the value of the corporation's outstanding
24    stock.
25        (4) A corporation and any party related to that
26    corporation in a manner that would require an attribution

 

 

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1    of stock from the corporation to the party or from the
2    party to the corporation under the attribution rules of
3    Section 318 of the Internal Revenue Code, if the
4    corporation and all such related parties own in the
5    aggregate at least 50% of the profits, capital, stock, or
6    value of the Taxpayer.
7        (5) A person to or from whom there is attribution of
8    stock ownership in accordance with Section 1563(e) of the
9    Internal Revenue Code, except, for purposes of determining
10    whether a person is a Related Member under this paragraph,
11    20% shall be substituted for 5% wherever 5% appears in
12    Section 1563(e) of the Internal Revenue Code.
13    "Taxpayer" means an individual, corporation, partnership,
14or other entity that has any Illinois Income Tax liability.
15    "Underserved area" means a geographic area that meets one
16or more of the following conditions:
17        (1) the area has a poverty rate of at least 20%
18    according to the latest federal decennial census;
19        (2) 75% or more of the children in the area participate
20    in the federal free lunch program according to reported
21    statistics from the State Board of Education;
22        (3) at least 20% of the households in the area receive
23    assistance under the Supplemental Nutrition Assistance
24    Program (SNAP); or
25        (4) the area has an average unemployment rate, as
26    determined by the Illinois Department of Employment

 

 

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1    Security, that is more than 120% of the national
2    unemployment average, as determined by the U.S. Department
3    of Labor, for a period of at least 2 consecutive calendar
4    years preceding the date of the application.
5(Source: P.A. 100-511, eff. 9-18-17.)
 
6    (35 ILCS 10/5-51 new)
7    Sec. 5-51. New Construction EDGE Agreement.
8    (a) Notwithstanding any other provisions of this Act, and
9in addition to any Credit otherwise allowed under this Act,
10there is allowed a New Construction EDGE Credit for eligible
11Applicants that meet the following criteria:
12        (1) the Department has certified that the Applicant
13    meets all requirements of Sections 5-15, 5-20, and 5-25;
14    and
15        (2) the Department has certified that, pursuant to
16    Section 5-20, the Applicant's Agreement includes a capital
17    investment of at least $10,000,000 in a New Construction
18    EDGE Project to be placed in service within the State as a
19    direct result of an Agreement entered into pursuant to this
20    Section.
21    (b) The Department shall notify each Applicant during the
22application process that their project is eligible for a New
23Construction EDGE Credit. The Department shall create a
24separate application to be filled out by the Applicant
25regarding the New Construction EDGE credit. The Application

 

 

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1shall include the following:
2        (1) a detailed description of the New Construction EDGE
3    Project that is subject to the New Construction EDGE
4    Agreement, including the location and amount of the
5    investment and jobs created or retained;
6        (2) the duration of the New Construction EDGE Credit
7    and the first taxable year for which the Credit may be
8    claimed;
9        (3) the New Construction EDGE Credit amount that will
10    be allowed for each taxable year;
11        (4) a requirement that the Director is authorized to
12    verify with the appropriate State agencies the amount of
13    the incremental income tax withheld by a Taxpayer, and
14    after doing so, shall issue a certificate to the Taxpayer
15    stating that the amounts have been verified;
16        (5) the amount of the capital investment, which may at
17    no point be less than $10,000,000, the time period of
18    placing the New Construction EDGE Project in service, and
19    the designated location in Illinois for the investment;
20        (6) a requirement that the Taxpayer shall provide
21    written notification to the Director not more than 30 days
22    after the Taxpayer determines that the capital investment
23    of at least $10,000,000 is not or will not be achieved or
24    maintained as set forth in the terms and conditions of the
25    Agreement;
26        (7) a detailed provision that the Taxpayer shall be

 

 

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1    awarded a New Construction EDGE Credit upon the verified
2    completion and occupancy of a New Construction EDGE
3    Project; and
4        (8) any other performance conditions, including the
5    ability to verify that a New Construction EDGE Project is
6    built and completed, or that contract provisions as the
7    Department determines are appropriate.
8    (c) The Department shall post on its website the terms of
9each New Construction EDGE Agreement entered into under this
10Act on or after the effective date of this amendatory Act of
11the 100th General Assembly. Such information shall be posted
12within 10 days after entering into the Agreement and must
13include the following:
14        (1) the name of the recipient business;
15        (2) the location of the project;
16        (3) the estimated value of the credit; and
17        (4) whether or not the project is located in an
18    underserved area.
19    (d) The Department, in collaboration with the Department of
20Labor, shall require that certified payroll reporting,
21pursuant to Section 5-56 of this Act, be completed in order to
22verify the wages and any other necessary information which the
23Department may deem necessary to ascertain and certify the
24total number of New Construction EDGE Employees subject to a
25New Construction EDGE Agreement and amount of a New
26Construction EDGE Credit.
 

 

 

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1    (35 ILCS 10/5-56 new)
2    Sec. 5-56. Certified payroll.
3    (a) Each contractor and subcontractor that is engaged in
4and is executing a New Construction EDGE Project for a
5Taxpayer, pursuant to a New Construction EDGE Agreement shall:
6        (1) make and keep, for a period of 5 years from the
7    date of the last payment made on or after the effective
8    date of this amendatory Act of the 100th General Assembly
9    on a contract or subcontract for a New Construction EDGE
10    Project pursuant to a New Construction EDGE Agreement,
11    records of all laborers and other workers employed by the
12    contractor or subcontractor on the project; the records
13    shall include:
14            (A) the worker's name;
15            (B) the worker's address;
16            (C) the worker's telephone number, if available;
17            (D) the worker's social security number;
18            (E) the worker's classification or
19        classifications;
20            (F) the worker's gross and net wages paid in each
21        pay period;
22            (G) the worker's number of hours worked each day;
23            (H) the worker's starting and ending times of work
24        each day;
25            (I) the worker's hourly wage rate; and

 

 

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1            (J) the worker's hourly overtime wage rate; and
2        (2) no later than the 15th day of each calendar month,
3    provide a certified payroll for the immediately preceding
4    month to the taxpayer in charge of the project; within 5
5    business days after receiving the certified payroll, the
6    taxpayer shall file the certified payroll with the
7    Department of Labor and the Department of Commerce and
8    Economic Opportunity; a certified payroll must be filed for
9    only those calendar months during which construction on a
10    New Construction EDGE Project has occurred; the certified
11    payroll shall consist of a complete copy of the records
12    identified in paragraph (1), but may exclude the starting
13    and ending times of work each day; the certified payroll
14    shall be accompanied by a statement signed by the
15    contractor or subcontractor or an officer, employee, or
16    agent of the contractor or subcontractor which avers that:
17            (A) he or she has examined the certified payroll
18        records required to be submitted by the Act and such
19        records are true and accurate; and
20            (B) the contractor or subcontractor is aware that
21        filing a certified payroll that he or she knows to be
22        false is a Class A misdemeanor.
23    A general contractor is not prohibited from relying on a
24certified payroll of a lower-tier subcontractor, provided the
25general contractor does not knowingly rely upon a
26subcontractor's false certification.

 

 

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1    Any contractor or subcontractor subject to this Section,
2and any officer, employee, or agent of such contractor or
3subcontractor whose duty as an officer, employee, or agent it
4is to file a certified payroll under this Section, who
5willfully fails to file such a certified payroll on or before
6the date such certified payroll is required to be filed and any
7person who willfully files a false certified payroll that is
8false as to any material fact is in violation of this Act and
9guilty of a Class A misdemeanor.
10    The taxpayer in charge of the project shall keep the
11records submitted in accordance with this subsection on or
12after the effective date of this Act of the 100th General
13Assembly for a period of 5 years from the date of the last
14payment for work on a contract or subcontract for the project.
15    The records submitted in accordance with this subsection
16shall be considered public records, except an employee's
17address, telephone number, and social security number, and made
18available in accordance with the Freedom of Information Act.
19The Department of Labor shall accept any reasonable submissions
20by the contractor that meet the requirements of this subsection
21and shall share the information with the Department in order to
22comply with the awarding of New Construction EDGE Credits. A
23contractor, subcontractor, or public body may retain records
24required under this Section in paper or electronic format.
25    Upon 7 business days' notice, the contractor and each
26subcontractor shall make available for inspection and copying

 

 

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1at a location within this State during reasonable hours, the
2records identified in paragraph (1) of this subsection to the
3taxpayer in charge of the project, its officers and agents, the
4Director of Labor and his deputies and agents, and to federal,
5State, or local law enforcement agencies and prosecutors.
 
6    Section 20. The River Edge Redevelopment Zone Act is
7amended by changing Section 10-3 and by adding Sections 10-10.3
8and 10-10.4 as follows:
 
9    (65 ILCS 115/10-3)
10    Sec. 10-3. Definitions. As used in this Act:
11    "Department" means the Department of Commerce and Economic
12Opportunity.
13    "River Edge Redevelopment Zone" means an area of the State
14certified by the Department as a River Edge Redevelopment Zone
15pursuant to this Act.
16    "Designated zone organization" means an association or
17entity: (1) the members of which are substantially all
18residents of the River Edge Redevelopment Zone or of the
19municipality in which the River Edge Redevelopment Zone is
20located; (2) the board of directors of which is elected by the
21members of the organization; (3) that satisfies the criteria
22set forth in Section 501(c) (3) or 501(c) (4) of the Internal
23Revenue Code; and (4) that exists primarily for the purpose of
24performing within the zone, for the benefit of the residents

 

 

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1and businesses thereof, any of the functions set forth in
2Section 8 of this Act.
3    "Incremental income tax" means the total amount withheld
4during the taxable year from the compensation of River Edge
5Construction Jobs Employees.
6    "Agency" means: each officer, board, commission, and
7agency created by the Constitution, in the executive branch of
8State government, other than the State Board of Elections; each
9officer, department, board, commission, agency, institution,
10authority, university, and body politic and corporate of the
11State; each administrative unit or corporate outgrowth of the
12State government that is created by or pursuant to statute,
13other than units of local government and their officers, school
14districts, and boards of election commissioners; and each
15administrative unit or corporate outgrowth of the above and as
16may be created by executive order of the Governor. No entity is
17an "agency" for the purposes of this Act unless the entity is
18authorized by law to make rules or regulations.
19    "River Edge construction jobs credit" means an amount equal
20to 50% of the incremental income tax attributable to River Edge
21construction employees employed on a River Edge construction
22jobs project. However, the amount may equal 75% of the
23incremental income tax attributable to River Edge construction
24employees employed on a River Edge construction jobs project
25located in an underserved area.
26    "River Edge construction jobs employee" means a laborer or

 

 

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1worker who is employed by an Illinois contractor or
2subcontractor in the actual construction work on the site of a
3River Edge construction jobs project.
4    "River Edge construction jobs project" means building a
5structure or building, or making improvements of any kind to
6real property, in a River Edge Redevelopment Zone that is built
7or improved in the course of completing a qualified
8rehabilitation plan. "River Edge construction jobs project"
9does not include the routine operation, routine repair, or
10routine maintenance of existing structures, buildings, or real
11property.
12    "Rule" means each agency statement of general
13applicability that implements, applies, interprets, or
14prescribes law or policy, but does not include (i) statements
15concerning only the internal management of an agency and not
16affecting private rights or procedures available to persons or
17entities outside the agency, (ii) intra-agency memoranda, or
18(iii) the prescription of standardized forms.
19    "Underserved area" means a geographic area that meets one
20or more of the following conditions:
21        (1) the area has a poverty rate of at least 20%
22    according to the latest federal decennial census;
23        (2) 75% or more of the children in the area participate
24    in the federal free lunch program according to reported
25    statistics from the State Board of Education;
26        (3) at least 20% of the households in the area receive

 

 

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1    assistance under the Supplemental Nutrition Assistance
2    Program (SNAP); or
3        (4) the area has an average unemployment rate, as
4    determined by the Illinois Department of Employment
5    Security, that is more than 120% of the national
6    unemployment average, as determined by the U.S. Department
7    of Labor, for a period of at least 2 consecutive calendar
8    years preceding the date of the application.
9(Source: P.A. 94-1021, eff. 7-12-06.)
 
10    (65 ILCS 115/10-10.3 new)
11    Sec. 10-10.3. River Edge Construction Jobs Credit.
12    (a) A business entity may receive a tax credit against the
13tax imposed under subsections (a) and (b) of Section 201 in an
14amount equal to 50% (or 75% if the project is located in an
15underserved area) of the amount of the incremental income tax
16attributable to River Edge construction jobs employees
17employed in the course of completing a River Edge construction
18jobs project. The credit allowed under this Section shall apply
19only to taxpayers that make a capital investment of at least
20$1,000,000 in a qualified rehabilitation plan.
21    (b) A business entity seeking a credit under this Section
22must submit an application to the Department describing the
23nature and benefit of the River Edge construction jobs project
24to the qualified rehabilitation project and the River Edge
25Redevelopment Zone. The Department may adopt any necessary

 

 

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1rules in order to administer the provisions of this Section.
2    (c) Within 45 days after the receipt of an application, the
3Department shall give notice to the applicant as to whether the
4application has been approved or disapproved. If the Department
5disapproves the application, it shall specify the reasons for
6this decision and allow 60 days for the applicant to amend and
7resubmit its application. The Department shall provide
8assistance upon request to applicants. Resubmitted
9applications shall receive the Department's approval or
10disapproval within 30 days of resubmission. Those resubmitted
11applications satisfying initial Department objectives shall be
12approved unless reasonable circumstances warrant disapproval.
13    (d) On an annual basis, the designated zone organization
14shall furnish a statement to the Department on the programmatic
15and financial status of any approved project and an audited
16financial statement of the project.
17    (e) The Department shall certify to the Department of
18Revenue the identity of the taxpayers who are eligible for
19River Edge construction jobs credits and the amounts of River
20Edge construction jobs credits awarded in each taxable year.
21    (f) The Department, in collaboration with the Department of
22Labor, shall require certified payroll reporting, pursuant to
23Section 10-10.4 of this Act, be completed in order to verify
24the wages and any other necessary information which the
25Department may deem necessary to ascertain and certify the
26total number of River Edge construction jobs employees and

 

 

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1determine the amount of a River Edge construction jobs credit.
 
2    (65 ILCS 115/10-10.4 new)
3    Sec. 10-10.4. Certified payroll.
4    (a) Any contractor and each subcontractor who is engaged in
5and is executing a River Edge construction jobs project for a
6taxpayer that is entitled to a credit pursuant to Section
710-10.3 of this Act shall:
8        (1) make and keep, for a period of 5 years from the
9    date of the last payment made on or after the effective
10    date of this amendatory Act of the 100th General Assembly
11    on a contract or subcontract for a River Edge Construction
12    Jobs Project in a River Edge Redevelopment Zone records of
13    all laborers and other workers employed by them on the
14    project; the records shall include:
15            (A) the worker's name;
16            (B) the worker's address;
17            (C) the worker's telephone number, if available;
18            (D) the worker's social security number;
19            (E) the worker's classification or
20        classifications;
21            (F) the worker's gross and net wages paid in each
22        pay period;
23            (G) the worker's number of hours worked each day;
24            (H) the worker's starting and ending times of work
25        each day;

 

 

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1            (I) the worker's hourly wage rate; and
2            (J) the worker's hourly overtime wage rate;
3        (2) no later than the 15th day of each calendar month,
4    provide a certified payroll for the immediately preceding
5    month to the taxpayer in charge of the project; within 5
6    business days after receiving the certified payroll, the
7    taxpayer shall file the certified payroll with the
8    Department of Labor and the Department of Commerce and
9    Economic Opportunity; a certified payroll must be filed for
10    only those calendar months during which construction on a
11    River Edge Construction Jobs Project has occurred; the
12    certified payroll shall consist of a complete copy of the
13    records identified in paragraph (1), but may exclude the
14    starting and ending times of work each day; the certified
15    payroll shall be accompanied by a statement signed by the
16    contractor or subcontractor or an officer, employee, or
17    agent of the contractor or subcontractor which avers that:
18            (A) he or she has examined the certified payroll
19        records required to be submitted and such records are
20        true and accurate; and
21            (B) the contractor or subcontractor is aware that
22        filing a certified payroll that he or she knows to be
23        false is a Class A misdemeanor.
24    A general contractor is not prohibited from relying on a
25certified payroll of a lower-tier subcontractor, provided the
26general contractor does not knowingly rely upon a

 

 

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1subcontractor's false certification.
2    Any contractor or subcontractor subject to this Section,
3and any officer, employee, or agent of such contractor or
4subcontractor whose duty as an officer, employee, or agent it
5is to file a certified payroll under this Section, who
6willfully fails to file such a certified payroll on or before
7the date such certified payroll is required to be filed and any
8person who willfully files a false certified payroll that is
9false as to any material fact is in violation of this Act and
10guilty of a Class A misdemeanor.
11    The taxpayer in charge of the project shall keep the
12records submitted in accordance with this Section on or after
13the effective date of this Act of the 100th General Assembly
14for a period of 5 years from the date of the last payment for
15work on a contract or subcontract for the project.
16    The records submitted in accordance with this subsection
17shall be considered public records, except an employee's
18address, telephone number, and social security number, and made
19available in accordance with the Freedom of Information Act.
20The Department of Labor shall accept any reasonable submissions
21by the contractor that meet the requirements of this subsection
22and shall share the information with the Department in order to
23comply with the awarding of River Edge construction jobs
24credits. A contractor, subcontractor, or public body may retain
25records required under this Section in paper or electronic
26format.

 

 

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1    Upon 7 business days' notice, the contractor and each
2subcontractor shall make available for inspection and copying
3at a location within this State during reasonable hours, the
4records identified in paragraph (1) of this subsection to the
5taxpayer in charge of the project, its officers and agents, the
6Director of Labor and his deputies and agents, and to federal,
7State, or local law enforcement agencies and prosecutors.