State of Illinois
91st General Assembly
Legislation

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91_HB3121

 
                                               LRB9111356SMdv

 1        AN ACT concerning taxation.

 2        Be it enacted by the People of  the  State  of  Illinois,
 3    represented in the General Assembly:

 4        Section  5.   The  Use  Tax  Act  is  amended by changing
 5    Section 3-5 as follows:

 6        (35 ILCS 105/3-5) (from Ch. 120, par. 439.3-5)
 7        Sec. 3-5.  Exemptions.  Use  of  the  following  tangible
 8    personal property is exempt from the tax imposed by this Act:
 9        (1)  Personal  property  purchased  from  a  corporation,
10    society,    association,    foundation,    institution,    or
11    organization, other than a limited liability company, that is
12    organized and operated as a not-for-profit service enterprise
13    for  the  benefit  of persons 65 years of age or older if the
14    personal property was not purchased by the enterprise for the
15    purpose of resale by the enterprise.
16        (2)  Personal  property  purchased  by  a  not-for-profit
17    Illinois county  fair  association  for  use  in  conducting,
18    operating, or promoting the county fair.
19        (3)  Personal property purchased by a not-for-profit arts
20    or  cultural organization that establishes, by proof required
21    by the Department by rule, that it has received an  exemption
22    under Section 501(c)(3) of the Internal Revenue Code and that
23    is  organized and operated for the presentation or support of
24    arts or cultural programming, activities, or services.  These
25    organizations include, but are  not  limited  to,  music  and
26    dramatic  arts  organizations such as symphony orchestras and
27    theatrical groups, arts and cultural  service  organizations,
28    local  arts  councils,  visual  arts organizations, and media
29    arts organizations.
30        (4)  Personal property purchased by a governmental  body,
31    by   a  corporation,  society,  association,  foundation,  or
 
                            -2-                LRB9111356SMdv
 1    institution   organized   and   operated   exclusively    for
 2    charitable,  religious,  or  educational  purposes,  or  by a
 3    not-for-profit corporation, society, association, foundation,
 4    institution, or organization that has no compensated officers
 5    or employees and that is organized and operated primarily for
 6    the recreation of persons 55 years of age or older. A limited
 7    liability company may qualify for the  exemption  under  this
 8    paragraph  only if the limited liability company is organized
 9    and operated exclusively for  educational  purposes.  On  and
10    after July 1, 1987, however, no entity otherwise eligible for
11    this exemption shall make tax-free purchases unless it has an
12    active   exemption   identification   number  issued  by  the
13    Department.
14        (5)  A passenger car that is a replacement vehicle to the
15    extent that the purchase price of the car is subject  to  the
16    Replacement Vehicle Tax.
17        (6)  Graphic  arts  machinery  and  equipment,  including
18    repair   and  replacement  parts,  both  new  and  used,  and
19    including that manufactured on special  order,  certified  by
20    the   purchaser   to  be  used  primarily  for  graphic  arts
21    production, and including machinery and  equipment  purchased
22    for lease.
23        (7)  Farm chemicals.
24        (8)  Legal  tender,  currency,  medallions,  or  gold  or
25    silver   coinage   issued  by  the  State  of  Illinois,  the
26    government of the United States of America, or the government
27    of any foreign country, and bullion.
28        (9)  Personal property purchased from a teacher-sponsored
29    student  organization  affiliated  with  an   elementary   or
30    secondary school located in Illinois.
31        (10)  A  motor  vehicle  of  the  first division, a motor
32    vehicle of the second division that is a self-contained motor
33    vehicle designed or permanently converted to  provide  living
34    quarters  for  recreational,  camping,  or  travel  use, with
 
                            -3-                LRB9111356SMdv
 1    direct walk through to the living quarters from the  driver's
 2    seat,  or  a  motor vehicle of the second division that is of
 3    the van configuration designed for the transportation of  not
 4    less  than  7  nor  more  than  16  passengers, as defined in
 5    Section 1-146 of the Illinois Vehicle Code, that is used  for
 6    automobile  renting,  as  defined  in  the Automobile Renting
 7    Occupation and Use Tax Act.
 8        (11)  Farm machinery and equipment, both  new  and  used,
 9    including  that  manufactured  on special order, certified by
10    the purchaser to be used primarily for production agriculture
11    or  State  or  federal   agricultural   programs,   including
12    individual replacement parts for the machinery and equipment,
13    including  machinery  and  equipment purchased for lease, and
14    including implements of husbandry defined in Section 1-130 of
15    the Illinois Vehicle Code, farm  machinery  and  agricultural
16    chemical  and fertilizer spreaders, and nurse wagons required
17    to be registered under Section 3-809 of the Illinois  Vehicle
18    Code,  but  excluding  other  motor  vehicles  required to be
19    registered under the  Illinois  Vehicle  Code.  Horticultural
20    polyhouses  or  hoop houses used for propagating, growing, or
21    overwintering plants shall be considered farm  machinery  and
22    equipment  under this item (11). Agricultural chemical tender
23    tanks and dry boxes shall include units sold separately  from
24    a  motor  vehicle  required  to  be  licensed  and units sold
25    mounted on a motor vehicle required to  be  licensed  if  the
26    selling price of the tender is separately stated.
27        Farm  machinery  and  equipment  shall  include precision
28    farming equipment  that  is  installed  or  purchased  to  be
29    installed  on farm machinery and equipment including, but not
30    limited  to,  tractors,   harvesters,   sprayers,   planters,
31    seeders,  or spreaders. Precision farming equipment includes,
32    but is not  limited  to,  soil  testing  sensors,  computers,
33    monitors,  software,  global positioning and mapping systems,
34    and other such equipment.
 
                            -4-                LRB9111356SMdv
 1        Farm machinery and  equipment  also  includes  computers,
 2    sensors,  software,  and  related equipment used primarily in
 3    the computer-assisted  operation  of  production  agriculture
 4    facilities,  equipment,  and  activities  such  as,  but  not
 5    limited  to,  the  collection, monitoring, and correlation of
 6    animal and crop data for the purpose  of  formulating  animal
 7    diets  and  agricultural chemicals.  This item (11) is exempt
 8    from the provisions of Section 3-90.
 9        (12)  Fuel and petroleum products sold to or used  by  an
10    air  common  carrier, certified by the carrier to be used for
11    consumption, shipment, or  storage  in  the  conduct  of  its
12    business  as an air common carrier, for a flight destined for
13    or returning from a location or locations outside the  United
14    States  without  regard  to  previous  or subsequent domestic
15    stopovers.
16        (13)  Proceeds of mandatory  service  charges  separately
17    stated  on  customers' bills for the purchase and consumption
18    of food and beverages purchased at retail from a retailer, to
19    the extent that the proceeds of the  service  charge  are  in
20    fact  turned  over as tips or as a substitute for tips to the
21    employees who participate  directly  in  preparing,  serving,
22    hosting  or  cleaning  up  the food or beverage function with
23    respect to which the service charge is imposed.
24        (14)  Oil field  exploration,  drilling,  and  production
25    equipment, including (i) rigs and parts of rigs, rotary rigs,
26    cable  tool  rigs,  and  workover rigs, (ii) pipe and tubular
27    goods, including casing and drill strings,  (iii)  pumps  and
28    pump-jack  units,  (iv) storage tanks and flow lines, (v) any
29    individual  replacement  part  for  oil  field   exploration,
30    drilling,  and  production  equipment, and (vi) machinery and
31    equipment purchased for lease; but excluding  motor  vehicles
32    required to be registered under the Illinois Vehicle Code.
33        (15)  Photoprocessing  machinery and equipment, including
34    repair and replacement parts, both new  and  used,  including
 
                            -5-                LRB9111356SMdv
 1    that   manufactured   on  special  order,  certified  by  the
 2    purchaser to  be  used  primarily  for  photoprocessing,  and
 3    including  photoprocessing  machinery and equipment purchased
 4    for lease.
 5        (16)  Coal  exploration,  mining,   offhighway   hauling,
 6    processing, maintenance, and reclamation equipment, including
 7    replacement  parts  and  equipment,  and  including equipment
 8    purchased for lease, but excluding motor vehicles required to
 9    be registered under the Illinois Vehicle Code.
10        (17)  Distillation machinery and  equipment,  sold  as  a
11    unit   or  kit,  assembled  or  installed  by  the  retailer,
12    certified by the user to be used only for the  production  of
13    ethyl alcohol that will be used for consumption as motor fuel
14    or  as  a component of motor fuel for the personal use of the
15    user, and not subject to sale or resale.
16        (18)  Manufacturing   and   assembling   machinery    and
17    equipment  used  primarily in the process of manufacturing or
18    assembling tangible personal property for wholesale or retail
19    sale or lease, whether that sale or lease is made directly by
20    the  manufacturer  or  by  some  other  person,  whether  the
21    materials used in the process are owned by  the  manufacturer
22    or  some  other person, or whether that sale or lease is made
23    apart from or as an incident to the seller's engaging in  the
24    service  occupation of producing machines, tools, dies, jigs,
25    patterns, gauges, or other similar  items  of  no  commercial
26    value on special order for a particular purchaser.
27        (19)  Personal  property  delivered  to  a  purchaser  or
28    purchaser's donee inside Illinois when the purchase order for
29    that  personal  property  was  received  by a florist located
30    outside Illinois who has a florist  located  inside  Illinois
31    deliver the personal property.
32        (20)  Semen used for artificial insemination of livestock
33    for direct agricultural production.
34        (21)  Horses, or interests in horses, registered with and
 
                            -6-                LRB9111356SMdv
 1    meeting  the  requirements  of  any of the Arabian Horse Club
 2    Registry of America, Appaloosa Horse Club,  American  Quarter
 3    Horse  Association,  United  States  Trotting Association, or
 4    Jockey Club, as appropriate, used for purposes of breeding or
 5    racing for prizes.
 6        (22)  Computers and communications equipment utilized for
 7    any hospital purpose and equipment  used  in  the  diagnosis,
 8    analysis,  or  treatment  of hospital patients purchased by a
 9    lessor who leases the equipment, under a lease of one year or
10    longer executed or in effect at the  time  the  lessor  would
11    otherwise  be  subject  to  the tax imposed by this Act, to a
12    hospital  that  has  been  issued  an  active  tax  exemption
13    identification  number  by the Department under Section 1g of
14    the Retailers' Occupation  Tax  Act.   If  the  equipment  is
15    leased  in  a manner that does not qualify for this exemption
16    or is used in any other non-exempt manner, the  lessor  shall
17    be  liable  for the tax imposed under this Act or the Service
18    Use Tax Act, as the case may be, based  on  the  fair  market
19    value  of  the  property  at  the time the non-qualifying use
20    occurs.  No lessor shall collect or  attempt  to  collect  an
21    amount  (however  designated) that purports to reimburse that
22    lessor for the tax imposed by this Act or the Service Use Tax
23    Act, as the case may be, if the tax has not been paid by  the
24    lessor.  If a lessor improperly collects any such amount from
25    the  lessee,  the  lessee shall have a legal right to claim a
26    refund of that amount from the  lessor.   If,  however,  that
27    amount  is  not  refunded  to  the lessee for any reason, the
28    lessor is liable to pay that amount to the Department.
29        (23)  Personal property purchased by a lessor who  leases
30    the  property,  under a lease of  one year or longer executed
31    or in effect at  the  time  the  lessor  would  otherwise  be
32    subject  to  the  tax  imposed by this Act, to a governmental
33    body that has been  issued  an  active  sales  tax  exemption
34    identification  number  by the Department under Section 1g of
 
                            -7-                LRB9111356SMdv
 1    the Retailers' Occupation Tax Act. If the property is  leased
 2    in  a manner that does not qualify for this exemption or used
 3    in any other non-exempt manner, the lessor  shall  be  liable
 4    for  the  tax  imposed  under this Act or the Service Use Tax
 5    Act, as the case may be, based on the fair  market  value  of
 6    the  property  at the time the non-qualifying use occurs.  No
 7    lessor shall collect or attempt to collect an amount (however
 8    designated) that purports to reimburse that  lessor  for  the
 9    tax  imposed  by  this Act or the Service Use Tax Act, as the
10    case may be, if the tax has not been paid by the lessor.   If
11    a lessor improperly collects any such amount from the lessee,
12    the lessee shall have a legal right to claim a refund of that
13    amount  from  the  lessor.   If,  however, that amount is not
14    refunded to the lessee for any reason, the lessor  is  liable
15    to pay that amount to the Department.
16        (24)  Beginning  with  taxable  years  ending on or after
17    December 31, 1995 and ending with taxable years ending on  or
18    before  December  31, 2004, personal property that is donated
19    for disaster relief to  be  used  in  a  State  or  federally
20    declared disaster area in Illinois or bordering Illinois by a
21    manufacturer  or retailer that is registered in this State to
22    a   corporation,   society,   association,   foundation,   or
23    institution that  has  been  issued  a  sales  tax  exemption
24    identification  number by the Department that assists victims
25    of the disaster who reside within the declared disaster area.
26        (25)  Beginning with taxable years  ending  on  or  after
27    December  31, 1995 and ending with taxable years ending on or
28    before December 31, 2004, personal property that is  used  in
29    the  performance  of  infrastructure  repairs  in this State,
30    including but not limited to  municipal  roads  and  streets,
31    access  roads,  bridges,  sidewalks,  waste disposal systems,
32    water and  sewer  line  extensions,  water  distribution  and
33    purification  facilities,  storm water drainage and retention
34    facilities, and sewage treatment facilities, resulting from a
 
                            -8-                LRB9111356SMdv
 1    State or federally declared disaster in Illinois or bordering
 2    Illinois  when  such  repairs  are  initiated  on  facilities
 3    located in the declared disaster area within 6  months  after
 4    the disaster.
 5        (26)  Beginning   July   1,  1999,  game  or  game  birds
 6    purchased at a "game breeding and hunting preserve  area"  or
 7    an  "exotic game hunting area" as those terms are used in the
 8    Wildlife Code or at  a  hunting  enclosure  approved  through
 9    rules  adopted  by the Department of Natural Resources.  This
10    paragraph is exempt from the provisions of Section 3-90.
11        (27) (26)  A motor vehicle, as that term  is  defined  in
12    Section  1-146  of the Illinois Vehicle Code, that is donated
13    to  a  corporation,  limited  liability   company,   society,
14    association, foundation, or institution that is determined by
15    the  Department  to be organized and operated exclusively for
16    educational purposes.  For purposes  of  this  exemption,  "a
17    corporation, limited liability company, society, association,
18    foundation, or institution organized and operated exclusively
19    for  educational  purposes"  means  all  tax-supported public
20    schools, private schools that offer systematic instruction in
21    useful branches of  learning  by  methods  common  to  public
22    schools  and  that  compare  favorably  in  their  scope  and
23    intensity with the course of study presented in tax-supported
24    schools,  and  vocational  or technical schools or institutes
25    organized and operated exclusively to  provide  a  course  of
26    study  of  not  less  than  6  weeks duration and designed to
27    prepare individuals to follow a trade or to pursue a  manual,
28    technical,  mechanical,  industrial,  business, or commercial
29    occupation.
30        (28) (27)  Beginning January 1, 2000,  personal property,
31    including food, purchased through fundraising events for  the
32    benefit  of  a  public  or  private  elementary  or secondary
33    school, a group of those  schools,  or  one  or  more  school
34    districts if the events are sponsored by an entity recognized
 
                            -9-                LRB9111356SMdv
 1    by  the school district that consists primarily of volunteers
 2    and includes parents and teachers  of  the  school  children.
 3    This  paragraph  does not apply to fundraising events (i) for
 4    the benefit of private home instruction or (ii) for which the
 5    fundraising entity purchases the personal  property  sold  at
 6    the  events  from  another individual or entity that sold the
 7    property for the purpose of resale by the fundraising  entity
 8    and  that  profits  from  the sale to the fundraising entity.
 9    This paragraph is exempt from the provisions of Section 3-90.
10        (29)  (26)  Beginning  January  1,  2000,  new  or   used
11    automatic  vending  machines  that prepare and serve hot food
12    and beverages, including coffee, soup, and other  items,  and
13    replacement  parts  for  these  machines.   This paragraph is
14    exempt from the provisions of Section 3-90.
15        (30)  Beginning  January  1,  2001,   tangible   personal
16    property   and   its   component   parts   purchased   by   a
17    telecommunications carrier if the property and parts are used
18    directly and primarily in transmitting, receiving, switching,
19    or   recording   any   interactive,  two-way  electromagnetic
20    communications,   including   voice,   image,    data,    and
21    information,  through  the  use of any medium, including, but
22    not limited to, poles, wires,  cables,  switching  equipment,
23    computers,  and  record  storage  devices  and  media.   This
24    paragraph is exempt from the provisions of Section 3-90.
25    (Source:  P.A.  90-14,  eff.  7-1-97;  90-552, eff. 12-12-97;
26    90-605, eff.  6-30-98;  91-51,  eff.  6-30-99;  91-200,  eff.
27    7-20-99;  91-439,  eff. 8-6-99; 91-637, eff. 8-20-99; 91-644,
28    eff. 8-20-99; revised 9-29-99.)

29        Section 10.  The  Service  Use  Tax  Act  is  amended  by
30    changing Section 3-5 as follows:

31        (35 ILCS 110/3-5) (from Ch. 120, par. 439.33-5)
32        Sec.  3-5.   Exemptions.   Use  of the following tangible
 
                            -10-               LRB9111356SMdv
 1    personal property is exempt from the tax imposed by this Act:
 2        (1)  Personal  property  purchased  from  a  corporation,
 3    society,    association,    foundation,    institution,    or
 4    organization, other than a limited liability company, that is
 5    organized and operated as a not-for-profit service enterprise
 6    for the benefit of persons 65 years of age or  older  if  the
 7    personal property was not purchased by the enterprise for the
 8    purpose of resale by the enterprise.
 9        (2)  Personal property purchased by a non-profit Illinois
10    county  fair association for use in conducting, operating, or
11    promoting the county fair.
12        (3)  Personal property purchased by a not-for-profit arts
13    or cultural organization that establishes, by proof  required
14    by  the Department by rule, that it has received an exemption
15    under Section 501(c)(3) of the Internal Revenue Code and that
16    is organized and operated for the presentation or support  of
17    arts or cultural programming, activities, or services.  These
18    organizations  include,  but  are  not  limited to, music and
19    dramatic arts organizations such as symphony  orchestras  and
20    theatrical  groups,  arts and cultural service organizations,
21    local arts councils, visual  arts  organizations,  and  media
22    arts organizations.
23        (4)  Legal  tender,  currency,  medallions,  or  gold  or
24    silver   coinage   issued  by  the  State  of  Illinois,  the
25    government of the United States of America, or the government
26    of any foreign country, and bullion.
27        (5)  Graphic  arts  machinery  and  equipment,  including
28    repair  and  replacement  parts,  both  new  and  used,   and
29    including that manufactured on special order or purchased for
30    lease,  certified  by  the purchaser to be used primarily for
31    graphic arts production.
32        (6)  Personal property purchased from a teacher-sponsored
33    student  organization  affiliated  with  an   elementary   or
34    secondary school located in Illinois.
 
                            -11-               LRB9111356SMdv
 1        (7)  Farm  machinery  and  equipment,  both new and used,
 2    including that manufactured on special  order,  certified  by
 3    the purchaser to be used primarily for production agriculture
 4    or   State   or   federal  agricultural  programs,  including
 5    individual replacement parts for the machinery and equipment,
 6    including machinery and equipment purchased  for  lease,  and
 7    including implements of husbandry defined in Section 1-130 of
 8    the  Illinois  Vehicle  Code, farm machinery and agricultural
 9    chemical and fertilizer spreaders, and nurse wagons  required
10    to  be registered under Section 3-809 of the Illinois Vehicle
11    Code, but excluding  other  motor  vehicles  required  to  be
12    registered  under  the  Illinois  Vehicle Code. Horticultural
13    polyhouses or hoop houses used for propagating,  growing,  or
14    overwintering  plants  shall be considered farm machinery and
15    equipment under this item (7). Agricultural  chemical  tender
16    tanks  and dry boxes shall include units sold separately from
17    a motor vehicle  required  to  be  licensed  and  units  sold
18    mounted  on  a  motor  vehicle required to be licensed if the
19    selling price of the tender is separately stated.
20        Farm machinery  and  equipment  shall  include  precision
21    farming  equipment  that  is  installed  or  purchased  to be
22    installed on farm machinery and equipment including, but  not
23    limited   to,   tractors,   harvesters,  sprayers,  planters,
24    seeders, or spreaders. Precision farming equipment  includes,
25    but  is  not  limited  to,  soil  testing sensors, computers,
26    monitors, software, global positioning and  mapping  systems,
27    and other such equipment.
28        Farm  machinery  and  equipment  also includes computers,
29    sensors, software, and related equipment  used  primarily  in
30    the  computer-assisted  operation  of  production agriculture
31    facilities,  equipment,  and  activities  such  as,  but  not
32    limited to, the collection, monitoring,  and  correlation  of
33    animal  and  crop  data for the purpose of formulating animal
34    diets and agricultural chemicals.  This item  (7)  is  exempt
 
                            -12-               LRB9111356SMdv
 1    from the provisions of Section 3-75.
 2        (8)  Fuel  and  petroleum  products sold to or used by an
 3    air common carrier, certified by the carrier to be  used  for
 4    consumption,  shipment,  or  storage  in  the  conduct of its
 5    business as an air common carrier, for a flight destined  for
 6    or  returning from a location or locations outside the United
 7    States without regard  to  previous  or  subsequent  domestic
 8    stopovers.
 9        (9)  Proceeds  of  mandatory  service  charges separately
10    stated on customers' bills for the purchase  and  consumption
11    of food and beverages acquired as an incident to the purchase
12    of  a  service  from  a  serviceman,  to  the extent that the
13    proceeds of the service charge are in  fact  turned  over  as
14    tips  or  as  a  substitute  for  tips  to  the employees who
15    participate  directly  in  preparing,  serving,  hosting   or
16    cleaning  up  the  food  or beverage function with respect to
17    which the service charge is imposed.
18        (10)  Oil field  exploration,  drilling,  and  production
19    equipment, including (i) rigs and parts of rigs, rotary rigs,
20    cable  tool  rigs,  and  workover rigs, (ii) pipe and tubular
21    goods, including casing and drill strings,  (iii)  pumps  and
22    pump-jack  units,  (iv) storage tanks and flow lines, (v) any
23    individual  replacement  part  for  oil  field   exploration,
24    drilling,  and  production  equipment, and (vi) machinery and
25    equipment purchased for lease; but excluding  motor  vehicles
26    required to be registered under the Illinois Vehicle Code.
27        (11)  Proceeds from the sale of photoprocessing machinery
28    and  equipment,  including repair and replacement parts, both
29    new and used, including that manufactured on  special  order,
30    certified   by   the  purchaser  to  be  used  primarily  for
31    photoprocessing, and including photoprocessing machinery  and
32    equipment purchased for lease.
33        (12)  Coal   exploration,   mining,  offhighway  hauling,
34    processing, maintenance, and reclamation equipment, including
 
                            -13-               LRB9111356SMdv
 1    replacement parts  and  equipment,  and  including  equipment
 2    purchased for lease, but excluding motor vehicles required to
 3    be registered under the Illinois Vehicle Code.
 4        (13)  Semen used for artificial insemination of livestock
 5    for direct agricultural production.
 6        (14)  Horses, or interests in horses, registered with and
 7    meeting  the  requirements  of  any of the Arabian Horse Club
 8    Registry of America, Appaloosa Horse Club,  American  Quarter
 9    Horse  Association,  United  States  Trotting Association, or
10    Jockey Club, as appropriate, used for purposes of breeding or
11    racing for prizes.
12        (15)  Computers and communications equipment utilized for
13    any hospital purpose and equipment  used  in  the  diagnosis,
14    analysis,  or  treatment  of hospital patients purchased by a
15    lessor who leases the equipment, under a lease of one year or
16    longer executed or in effect at the  time  the  lessor  would
17    otherwise  be  subject  to  the tax imposed by this Act, to a
18    hospital  that  has  been  issued  an  active  tax  exemption
19    identification number by the Department under Section  1g  of
20    the Retailers' Occupation Tax Act. If the equipment is leased
21    in  a  manner  that does not qualify for this exemption or is
22    used in any other non-exempt  manner,  the  lessor  shall  be
23    liable for the tax imposed under this Act or the Use Tax Act,
24    as  the  case  may  be, based on the fair market value of the
25    property at the  time  the  non-qualifying  use  occurs.   No
26    lessor shall collect or attempt to collect an amount (however
27    designated)  that  purports  to reimburse that lessor for the
28    tax imposed by this Act or the Use Tax Act, as the  case  may
29    be,  if the tax has not been paid by the lessor.  If a lessor
30    improperly collects any such  amount  from  the  lessee,  the
31    lessee  shall  have  a  legal right to claim a refund of that
32    amount from the lessor.  If,  however,  that  amount  is  not
33    refunded  to  the lessee for any reason, the lessor is liable
34    to pay that amount to the Department.
 
                            -14-               LRB9111356SMdv
 1        (16)  Personal property purchased by a lessor who  leases
 2    the property, under a lease of one year or longer executed or
 3    in  effect  at the time the lessor would otherwise be subject
 4    to the tax imposed by this Act, to a governmental  body  that
 5    has been issued an active tax exemption identification number
 6    by   the  Department  under  Section  1g  of  the  Retailers'
 7    Occupation Tax Act.  If the property is leased  in  a  manner
 8    that  does  not  qualify for this exemption or is used in any
 9    other non-exempt manner, the lessor shall be liable  for  the
10    tax  imposed  under  this Act or the Use Tax Act, as the case
11    may be, based on the fair market value of the property at the
12    time the non-qualifying use occurs.  No lessor shall  collect
13    or  attempt  to  collect  an amount (however designated) that
14    purports to reimburse that lessor for the tax imposed by this
15    Act or the Use Tax Act, as the case may be, if  the  tax  has
16    not been paid by the lessor.  If a lessor improperly collects
17    any  such  amount  from  the  lessee, the lessee shall have a
18    legal right to claim a refund of that amount from the lessor.
19    If, however, that amount is not refunded to  the  lessee  for
20    any  reason,  the  lessor is liable to pay that amount to the
21    Department.
22        (17)  Beginning with taxable years  ending  on  or  after
23    December  31, 1995 and ending with taxable years ending on or
24    before December 31, 2004, personal property that  is  donated
25    for  disaster  relief  to  be  used  in  a State or federally
26    declared disaster area in Illinois or bordering Illinois by a
27    manufacturer or retailer that is registered in this State  to
28    a   corporation,   society,   association,   foundation,   or
29    institution  that  has  been  issued  a  sales  tax exemption
30    identification number by the Department that assists  victims
31    of the disaster who reside within the declared disaster area.
32        (18)  Beginning  with  taxable  years  ending on or after
33    December 31, 1995 and ending with taxable years ending on  or
34    before  December  31, 2004, personal property that is used in
 
                            -15-               LRB9111356SMdv
 1    the performance of  infrastructure  repairs  in  this  State,
 2    including  but  not  limited  to municipal roads and streets,
 3    access roads, bridges,  sidewalks,  waste  disposal  systems,
 4    water  and  sewer  line  extensions,  water  distribution and
 5    purification facilities, storm water drainage  and  retention
 6    facilities, and sewage treatment facilities, resulting from a
 7    State or federally declared disaster in Illinois or bordering
 8    Illinois  when  such  repairs  are  initiated  on  facilities
 9    located  in  the declared disaster area within 6 months after
10    the disaster.
11        (19)  Beginning  July  1,  1999,  game  or   game   birds
12    purchased  at  a "game breeding and hunting preserve area" or
13    an "exotic game hunting area" as those terms are used in  the
14    Wildlife  Code  or  at  a  hunting enclosure approved through
15    rules adopted by the Department of Natural  Resources.   This
16    paragraph is exempt from the provisions of Section 3-75.
17        (20)  (19)  A  motor  vehicle, as that term is defined in
18    Section 1-146 of the Illinois Vehicle Code, that  is  donated
19    to   a   corporation,  limited  liability  company,  society,
20    association, foundation, or institution that is determined by
21    the Department to be organized and operated  exclusively  for
22    educational  purposes.   For  purposes  of this exemption, "a
23    corporation, limited liability company, society, association,
24    foundation, or institution organized and operated exclusively
25    for educational  purposes"  means  all  tax-supported  public
26    schools, private schools that offer systematic instruction in
27    useful  branches  of  learning  by  methods  common to public
28    schools  and  that  compare  favorably  in  their  scope  and
29    intensity with the course of study presented in tax-supported
30    schools, and vocational or technical  schools  or  institutes
31    organized  and  operated  exclusively  to provide a course of
32    study of not less than  6  weeks  duration  and  designed  to
33    prepare  individuals to follow a trade or to pursue a manual,
34    technical, mechanical, industrial,  business,  or  commercial
 
                            -16-               LRB9111356SMdv
 1    occupation.
 2        (21) (20)  Beginning January 1, 2000,  personal property,
 3    including  food, purchased through fundraising events for the
 4    benefit of  a  public  or  private  elementary  or  secondary
 5    school,  a  group  of  those  schools,  or one or more school
 6    districts if the events are sponsored by an entity recognized
 7    by the school district that consists primarily of  volunteers
 8    and  includes  parents  and  teachers of the school children.
 9    This paragraph does not apply to fundraising events  (i)  for
10    the benefit of private home instruction or (ii) for which the
11    fundraising  entity  purchases  the personal property sold at
12    the events from another individual or entity  that  sold  the
13    property  for the purpose of resale by the fundraising entity
14    and that profits from the sale  to  the  fundraising  entity.
15    This paragraph is exempt from the provisions of Section 3-75.
16        (22)   (19)  Beginning  January  1,  2000,  new  or  used
17    automatic vending machines that prepare and  serve  hot  food
18    and  beverages,  including coffee, soup, and other items, and
19    replacement parts for  these  machines.   This  paragraph  is
20    exempt from the provisions of Section 3-75.
21        (23)  Beginning   January   1,  2001,  tangible  personal
22    property   and   its   component   parts   purchased   by   a
23    telecommunications carrier if the property and parts are used
24    directly and primarily in transmitting, receiving, switching,
25    or  recording  any   interactive,   two-way   electromagnetic
26    communications,    including    voice,   image,   data,   and
27    information, through the use of any  medium,  including,  but
28    not  limited  to,  poles, wires, cables, switching equipment,
29    computers,  and  record  storage  devices  and  media.   This
30    paragraph is exempt from the provisions of Section 3-75.
31    (Source: P.A. 90-14,  eff.  7-1-97;  90-552,  eff.  12-12-97;
32    90-605,  eff.  6-30-98;  91-51,  eff.  6-30-99;  91-200, eff.
33    7-20-99; 91-439, eff. 8-6-99; 91-637, eff.  8-20-99;  91-644,
34    eff. 8-20-99; revised 9-29-99.)
 
                            -17-               LRB9111356SMdv
 1        Section 15.  The Service Occupation Tax Act is amended by
 2    changing Section 3-5 as follows:

 3        (35 ILCS 115/3-5) (from Ch. 120, par. 439.103-5)
 4        Sec.  3-5.   Exemptions.  The following tangible personal
 5    property is exempt from the tax imposed by this Act:
 6        (1)  Personal property sold by  a  corporation,  society,
 7    association,  foundation, institution, or organization, other
 8    than a limited  liability  company,  that  is  organized  and
 9    operated  as  a  not-for-profit  service  enterprise  for the
10    benefit of persons 65 years of age or older if  the  personal
11    property  was not purchased by the enterprise for the purpose
12    of resale by the enterprise.
13        (2)  Personal  property  purchased  by  a  not-for-profit
14    Illinois county  fair  association  for  use  in  conducting,
15    operating, or promoting the county fair.
16        (3)  Personal  property  purchased  by any not-for-profit
17    arts or cultural  organization  that  establishes,  by  proof
18    required  by  the Department by rule, that it has received an
19    exemption  under Section 501(c)(3) of  the  Internal  Revenue
20    Code  and that is organized and operated for the presentation
21    or support of arts or cultural  programming,  activities,  or
22    services.   These  organizations include, but are not limited
23    to, music and dramatic arts organizations  such  as  symphony
24    orchestras  and  theatrical groups, arts and cultural service
25    organizations,   local    arts    councils,    visual    arts
26    organizations, and media arts organizations.
27        (4)  Legal  tender,  currency,  medallions,  or  gold  or
28    silver   coinage   issued  by  the  State  of  Illinois,  the
29    government of the United States of America, or the government
30    of any foreign country, and bullion.
31        (5)  Graphic  arts  machinery  and  equipment,  including
32    repair  and  replacement  parts,  both  new  and  used,   and
33    including that manufactured on special order or purchased for
 
                            -18-               LRB9111356SMdv
 1    lease,  certified  by  the purchaser to be used primarily for
 2    graphic arts production.
 3        (6)  Personal  property  sold  by   a   teacher-sponsored
 4    student   organization   affiliated  with  an  elementary  or
 5    secondary school located in Illinois.
 6        (7)  Farm machinery and equipment,  both  new  and  used,
 7    including  that  manufactured  on special order, certified by
 8    the purchaser to be used primarily for production agriculture
 9    or  State  or  federal   agricultural   programs,   including
10    individual replacement parts for the machinery and equipment,
11    including  machinery  and  equipment purchased for lease, and
12    including implements of husbandry defined in Section 1-130 of
13    the Illinois Vehicle Code, farm  machinery  and  agricultural
14    chemical  and fertilizer spreaders, and nurse wagons required
15    to be registered under Section 3-809 of the Illinois  Vehicle
16    Code,  but  excluding  other  motor  vehicles  required to be
17    registered under the  Illinois  Vehicle  Code.  Horticultural
18    polyhouses  or  hoop houses used for propagating, growing, or
19    overwintering plants shall be considered farm  machinery  and
20    equipment  under  this item (7). Agricultural chemical tender
21    tanks and dry boxes shall include units sold separately  from
22    a  motor  vehicle  required  to  be  licensed  and units sold
23    mounted on a motor vehicle required to  be  licensed  if  the
24    selling price of the tender is separately stated.
25        Farm  machinery  and  equipment  shall  include precision
26    farming equipment  that  is  installed  or  purchased  to  be
27    installed  on farm machinery and equipment including, but not
28    limited  to,  tractors,   harvesters,   sprayers,   planters,
29    seeders,  or spreaders. Precision farming equipment includes,
30    but is not  limited  to,  soil  testing  sensors,  computers,
31    monitors,  software,  global positioning and mapping systems,
32    and other such equipment.
33        Farm machinery and  equipment  also  includes  computers,
34    sensors,  software,  and  related equipment used primarily in
 
                            -19-               LRB9111356SMdv
 1    the computer-assisted  operation  of  production  agriculture
 2    facilities,  equipment,  and  activities  such  as,  but  not
 3    limited  to,  the  collection, monitoring, and correlation of
 4    animal and crop data for the purpose  of  formulating  animal
 5    diets  and  agricultural  chemicals.  This item (7) is exempt
 6    from the provisions of Section 3-55.
 7        (8)  Fuel and petroleum products sold to or  used  by  an
 8    air  common  carrier, certified by the carrier to be used for
 9    consumption, shipment, or  storage  in  the  conduct  of  its
10    business  as an air common carrier, for a flight destined for
11    or returning from a location or locations outside the  United
12    States  without  regard  to  previous  or subsequent domestic
13    stopovers.
14        (9)  Proceeds of  mandatory  service  charges  separately
15    stated  on  customers' bills for the purchase and consumption
16    of food and beverages, to the extent that the proceeds of the
17    service charge are in fact  turned  over  as  tips  or  as  a
18    substitute for tips to the employees who participate directly
19    in  preparing,  serving,  hosting  or cleaning up the food or
20    beverage function with respect to which the service charge is
21    imposed.
22        (10)  Oil field  exploration,  drilling,  and  production
23    equipment, including (i) rigs and parts of rigs, rotary rigs,
24    cable  tool  rigs,  and  workover rigs, (ii) pipe and tubular
25    goods, including casing and drill strings,  (iii)  pumps  and
26    pump-jack  units,  (iv) storage tanks and flow lines, (v) any
27    individual  replacement  part  for  oil  field   exploration,
28    drilling,  and  production  equipment, and (vi) machinery and
29    equipment purchased for lease; but excluding  motor  vehicles
30    required to be registered under the Illinois Vehicle Code.
31        (11)  Photoprocessing  machinery and equipment, including
32    repair and replacement parts, both new  and  used,  including
33    that   manufactured   on  special  order,  certified  by  the
34    purchaser to  be  used  primarily  for  photoprocessing,  and
 
                            -20-               LRB9111356SMdv
 1    including  photoprocessing  machinery and equipment purchased
 2    for lease.
 3        (12)  Coal  exploration,  mining,   offhighway   hauling,
 4    processing, maintenance, and reclamation equipment, including
 5    replacement  parts  and  equipment,  and  including equipment
 6    purchased for lease, but excluding motor vehicles required to
 7    be registered under the Illinois Vehicle Code.
 8        (13)  Food for human consumption that is to  be  consumed
 9    off  the  premises  where  it  is  sold (other than alcoholic
10    beverages, soft drinks and food that has  been  prepared  for
11    immediate  consumption) and prescription and non-prescription
12    medicines, drugs,  medical  appliances,  and  insulin,  urine
13    testing  materials,  syringes, and needles used by diabetics,
14    for human use, when purchased for use by a  person  receiving
15    medical assistance under Article 5 of the Illinois Public Aid
16    Code  who  resides  in a licensed long-term care facility, as
17    defined in the Nursing Home Care Act.
18        (14)  Semen used for artificial insemination of livestock
19    for direct agricultural production.
20        (15)  Horses, or interests in horses, registered with and
21    meeting the requirements of any of  the  Arabian  Horse  Club
22    Registry  of  America, Appaloosa Horse Club, American Quarter
23    Horse Association, United  States  Trotting  Association,  or
24    Jockey Club, as appropriate, used for purposes of breeding or
25    racing for prizes.
26        (16)  Computers and communications equipment utilized for
27    any  hospital  purpose  and  equipment used in the diagnosis,
28    analysis, or treatment of hospital patients sold to a  lessor
29    who leases the equipment, under a lease of one year or longer
30    executed  or  in  effect  at  the  time of the purchase, to a
31    hospital  that  has  been  issued  an  active  tax  exemption
32    identification number by the Department under Section  1g  of
33    the Retailers' Occupation Tax Act.
34        (17)  Personal  property  sold to a lessor who leases the
 
                            -21-               LRB9111356SMdv
 1    property, under a lease of one year or longer executed or  in
 2    effect  at  the  time of the purchase, to a governmental body
 3    that has been issued an active tax  exemption  identification
 4    number  by  the Department under Section 1g of the Retailers'
 5    Occupation Tax Act.
 6        (18)  Beginning with taxable years  ending  on  or  after
 7    December  31, 1995 and ending with taxable years ending on or
 8    before December 31, 2004, personal property that  is  donated
 9    for  disaster  relief  to  be  used  in  a State or federally
10    declared disaster area in Illinois or bordering Illinois by a
11    manufacturer or retailer that is registered in this State  to
12    a   corporation,   society,   association,   foundation,   or
13    institution  that  has  been  issued  a  sales  tax exemption
14    identification number by the Department that assists  victims
15    of the disaster who reside within the declared disaster area.
16        (19)  Beginning  with  taxable  years  ending on or after
17    December 31, 1995 and ending with taxable years ending on  or
18    before  December  31, 2004, personal property that is used in
19    the performance of  infrastructure  repairs  in  this  State,
20    including  but  not  limited  to municipal roads and streets,
21    access roads, bridges,  sidewalks,  waste  disposal  systems,
22    water  and  sewer  line  extensions,  water  distribution and
23    purification facilities, storm water drainage  and  retention
24    facilities, and sewage treatment facilities, resulting from a
25    State or federally declared disaster in Illinois or bordering
26    Illinois  when  such  repairs  are  initiated  on  facilities
27    located  in  the declared disaster area within 6 months after
28    the disaster.
29        (20)  Beginning July 1, 1999, game or game birds sold  at
30    a  "game  breeding  and  hunting preserve area" or an "exotic
31    game hunting area" as those terms are used  in  the  Wildlife
32    Code or at a hunting enclosure approved through rules adopted
33    by  the  Department  of Natural Resources.  This paragraph is
34    exempt from the provisions of Section 3-55.
 
                            -22-               LRB9111356SMdv
 1        (21) (20)  A motor vehicle, as that term  is  defined  in
 2    Section  1-146  of the Illinois Vehicle Code, that is donated
 3    to  a  corporation,  limited  liability   company,   society,
 4    association, foundation, or institution that is determined by
 5    the  Department  to be organized and operated exclusively for
 6    educational purposes.  For purposes  of  this  exemption,  "a
 7    corporation, limited liability company, society, association,
 8    foundation, or institution organized and operated exclusively
 9    for  educational  purposes"  means  all  tax-supported public
10    schools, private schools that offer systematic instruction in
11    useful branches of  learning  by  methods  common  to  public
12    schools  and  that  compare  favorably  in  their  scope  and
13    intensity with the course of study presented in tax-supported
14    schools,  and  vocational  or technical schools or institutes
15    organized and operated exclusively to  provide  a  course  of
16    study  of  not  less  than  6  weeks duration and designed to
17    prepare individuals to follow a trade or to pursue a  manual,
18    technical,  mechanical,  industrial,  business, or commercial
19    occupation.
20        (22) (21)  Beginning January 1, 2000,  personal property,
21    including food, purchased through fundraising events for  the
22    benefit  of  a  public  or  private  elementary  or secondary
23    school, a group of those  schools,  or  one  or  more  school
24    districts if the events are sponsored by an entity recognized
25    by  the school district that consists primarily of volunteers
26    and includes parents and teachers  of  the  school  children.
27    This  paragraph  does not apply to fundraising events (i) for
28    the benefit of private home instruction or (ii) for which the
29    fundraising entity purchases the personal  property  sold  at
30    the  events  from  another individual or entity that sold the
31    property for the purpose of resale by the fundraising  entity
32    and  that  profits  from  the sale to the fundraising entity.
33    This paragraph is exempt from the provisions of Section 3-55.
34        (23)  (20)  Beginning  January  1,  2000,  new  or   used
 
                            -23-               LRB9111356SMdv
 1    automatic  vending  machines  that prepare and serve hot food
 2    and beverages, including coffee, soup, and other  items,  and
 3    replacement  parts  for  these  machines.   This paragraph is
 4    exempt from the provisions of Section 3-55.
 5        (24)  Beginning  January  1,  2001,   tangible   personal
 6    property   and   its   component   parts   purchased   by   a
 7    telecommunications carrier if the property and parts are used
 8    directly and primarily in transmitting, receiving, switching,
 9    or   recording   any   interactive,  two-way  electromagnetic
10    communications,   including   voice,   image,    data,    and
11    information,  through  the  use of any medium, including, but
12    not limited to, poles, wires,  cables,  switching  equipment,
13    computers,  and  record  storage  devices  and  media.   This
14    paragraph is exempt from the provisions of Section 3-55.
15    (Source: P.A.  90-14,  eff.  7-1-97;  90-552,  eff. 12-12-97;
16    90-605, eff.  6-30-98;  91-51,  eff.  6-30-99;  91-200,  eff.
17    7-20-99;  91-439,  eff. 8-6-99; 91-533, eff. 8-13-99; 91-637,
18    eff. 8-20-99; 91-644, eff. 8-20-99; revised 9-29-99.)

19        Section 20.  The Retailers' Occupation Tax Act is amended
20    by changing Section 2-5 as follows:

21        (35 ILCS 120/2-5) (from Ch. 120, par. 441-5)
22        Sec. 2-5.  Exemptions.  Gross receipts from proceeds from
23    the sale of the  following  tangible  personal  property  are
24    exempt from the tax imposed by this Act:
25        (1)  Farm chemicals.
26        (2)  Farm  machinery  and  equipment,  both new and used,
27    including that manufactured on special  order,  certified  by
28    the purchaser to be used primarily for production agriculture
29    or   State   or   federal  agricultural  programs,  including
30    individual replacement parts for the machinery and equipment,
31    including machinery and equipment purchased  for  lease,  and
32    including implements of husbandry defined in Section 1-130 of
 
                            -24-               LRB9111356SMdv
 1    the  Illinois  Vehicle  Code, farm machinery and agricultural
 2    chemical and fertilizer spreaders, and nurse wagons  required
 3    to  be registered under Section 3-809 of the Illinois Vehicle
 4    Code, but excluding  other  motor  vehicles  required  to  be
 5    registered  under  the  Illinois  Vehicle Code. Horticultural
 6    polyhouses or hoop houses used for propagating,  growing,  or
 7    overwintering  plants  shall be considered farm machinery and
 8    equipment under this item (2). Agricultural  chemical  tender
 9    tanks  and dry boxes shall include units sold separately from
10    a motor vehicle  required  to  be  licensed  and  units  sold
11    mounted  on  a  motor vehicle required to be licensed, if the
12    selling price of the tender is separately stated.
13        Farm machinery  and  equipment  shall  include  precision
14    farming  equipment  that  is  installed  or  purchased  to be
15    installed on farm machinery and equipment including, but  not
16    limited   to,   tractors,   harvesters,  sprayers,  planters,
17    seeders, or spreaders. Precision farming equipment  includes,
18    but  is  not  limited  to,  soil  testing sensors, computers,
19    monitors, software, global positioning and  mapping  systems,
20    and other such equipment.
21        Farm  machinery  and  equipment  also includes computers,
22    sensors, software, and related equipment  used  primarily  in
23    the  computer-assisted  operation  of  production agriculture
24    facilities,  equipment,  and  activities  such  as,  but  not
25    limited to, the collection, monitoring,  and  correlation  of
26    animal  and  crop  data for the purpose of formulating animal
27    diets and agricultural chemicals.  This item  (7)  is  exempt
28    from the provisions of Section 2-70.
29        (3)  Distillation machinery and equipment, sold as a unit
30    or  kit, assembled or installed by the retailer, certified by
31    the user to be used only for the production of ethyl  alcohol
32    that  will  be  used  for  consumption  as motor fuel or as a
33    component of motor fuel for the personal use of the user, and
34    not subject to sale or resale.
 
                            -25-               LRB9111356SMdv
 1        (4)  Graphic  arts  machinery  and  equipment,  including
 2    repair  and  replacement  parts,  both  new  and  used,   and
 3    including that manufactured on special order or purchased for
 4    lease,  certified  by  the purchaser to be used primarily for
 5    graphic arts production.
 6        (5)  A motor vehicle  of  the  first  division,  a  motor
 7    vehicle of the second division that is a self-contained motor
 8    vehicle  designed  or permanently converted to provide living
 9    quarters for  recreational,  camping,  or  travel  use,  with
10    direct  walk  through  access to the living quarters from the
11    driver's seat, or a motor vehicle of the second division that
12    is of the van configuration designed for  the  transportation
13    of not less than 7 nor more than 16 passengers, as defined in
14    Section  1-146 of the Illinois Vehicle Code, that is used for
15    automobile renting, as  defined  in  the  Automobile  Renting
16    Occupation and Use Tax Act.
17        (6)  Personal   property   sold  by  a  teacher-sponsored
18    student  organization  affiliated  with  an   elementary   or
19    secondary school located in Illinois.
20        (7)  Proceeds  of  that portion of the selling price of a
21    passenger car the sale of which is subject to the Replacement
22    Vehicle Tax.
23        (8)  Personal property sold to an  Illinois  county  fair
24    association  for  use  in conducting, operating, or promoting
25    the county fair.
26        (9)  Personal property sold to a not-for-profit  arts  or
27    cultural  organization that establishes, by proof required by
28    the Department by rule, that it  has  received  an  exemption
29    under Section 501(c)(3) of the Internal Revenue Code and that
30    is  organized and operated for the presentation or support of
31    arts or cultural programming, activities, or services.  These
32    organizations include, but are  not  limited  to,  music  and
33    dramatic  arts  organizations such as symphony orchestras and
34    theatrical groups, arts and cultural  service  organizations,
 
                            -26-               LRB9111356SMdv
 1    local  arts  councils,  visual  arts organizations, and media
 2    arts organizations.
 3        (10)  Personal property sold by a  corporation,  society,
 4    association,  foundation, institution, or organization, other
 5    than a limited  liability  company,  that  is  organized  and
 6    operated  as  a  not-for-profit  service  enterprise  for the
 7    benefit of persons 65 years of age or older if  the  personal
 8    property  was not purchased by the enterprise for the purpose
 9    of resale by the enterprise.
10        (11)  Personal property sold to a governmental body, to a
11    corporation, society, association, foundation, or institution
12    organized and operated exclusively for charitable, religious,
13    or educational purposes, or to a not-for-profit  corporation,
14    society,    association,    foundation,    institution,    or
15    organization  that  has  no compensated officers or employees
16    and  that  is  organized  and  operated  primarily  for   the
17    recreation  of  persons  55  years of age or older. A limited
18    liability company may qualify for the  exemption  under  this
19    paragraph  only if the limited liability company is organized
20    and operated exclusively for  educational  purposes.  On  and
21    after July 1, 1987, however, no entity otherwise eligible for
22    this exemption shall make tax-free purchases unless it has an
23    active identification number issued by the Department.
24        (12)  Personal  property  sold to interstate carriers for
25    hire for use as rolling stock moving in  interstate  commerce
26    or  to lessors under leases of one year or longer executed or
27    in effect at the time of purchase by interstate carriers  for
28    hire  for  use as rolling stock moving in interstate commerce
29    and equipment  operated  by  a  telecommunications  provider,
30    licensed  as  a  common carrier by the Federal Communications
31    Commission, which is permanently installed in or  affixed  to
32    aircraft moving in interstate commerce.
33        (13)  Proceeds from sales to owners, lessors, or shippers
34    of  tangible personal property that is utilized by interstate
 
                            -27-               LRB9111356SMdv
 1    carriers  for  hire  for  use  as  rolling  stock  moving  in
 2    interstate   commerce   and   equipment   operated    by    a
 3    telecommunications  provider, licensed as a common carrier by
 4    the Federal Communications Commission, which  is  permanently
 5    installed  in  or  affixed  to  aircraft moving in interstate
 6    commerce.
 7        (14)  Machinery and equipment that will be  used  by  the
 8    purchaser,  or  a  lessee  of the purchaser, primarily in the
 9    process of  manufacturing  or  assembling  tangible  personal
10    property  for  wholesale or retail sale or lease, whether the
11    sale or lease is made directly by the manufacturer or by some
12    other person, whether the materials used in the  process  are
13    owned  by  the  manufacturer or some other person, or whether
14    the sale or lease is made apart from or as an incident to the
15    seller's engaging in  the  service  occupation  of  producing
16    machines,  tools,  dies,  jigs,  patterns,  gauges,  or other
17    similar items of no commercial value on special order  for  a
18    particular purchaser.
19        (15)  Proceeds  of  mandatory  service charges separately
20    stated on customers' bills for purchase  and  consumption  of
21    food  and  beverages,  to the extent that the proceeds of the
22    service charge are in fact  turned  over  as  tips  or  as  a
23    substitute for tips to the employees who participate directly
24    in  preparing,  serving,  hosting  or cleaning up the food or
25    beverage function with respect to which the service charge is
26    imposed.
27        (16)  Petroleum products  sold  to  a  purchaser  if  the
28    seller  is prohibited by federal law from charging tax to the
29    purchaser.
30        (17)  Tangible personal property sold to a common carrier
31    by rail or motor that receives the physical possession of the
32    property in Illinois and that  transports  the  property,  or
33    shares  with  another common carrier in the transportation of
34    the property, out of Illinois on a standard uniform  bill  of
 
                            -28-               LRB9111356SMdv
 1    lading  showing  the seller of the property as the shipper or
 2    consignor of the property to a destination outside  Illinois,
 3    for use outside Illinois.
 4        (18)  Legal  tender,  currency,  medallions,  or  gold or
 5    silver  coinage  issued  by  the  State  of   Illinois,   the
 6    government of the United States of America, or the government
 7    of any foreign country, and bullion.
 8        (19)  Oil  field  exploration,  drilling,  and production
 9    equipment, including (i) rigs and parts of rigs, rotary rigs,
10    cable tool rigs, and workover rigs,  (ii)  pipe  and  tubular
11    goods,  including  casing  and drill strings, (iii) pumps and
12    pump-jack units, (iv) storage tanks and flow lines,  (v)  any
13    individual   replacement  part  for  oil  field  exploration,
14    drilling, and production equipment, and  (vi)  machinery  and
15    equipment  purchased  for lease; but excluding motor vehicles
16    required to be registered under the Illinois Vehicle Code.
17        (20)  Photoprocessing machinery and equipment,  including
18    repair  and  replacement  parts, both new and used, including
19    that  manufactured  on  special  order,  certified   by   the
20    purchaser  to  be  used  primarily  for  photoprocessing, and
21    including photoprocessing machinery and  equipment  purchased
22    for lease.
23        (21)  Coal   exploration,   mining,  offhighway  hauling,
24    processing, maintenance, and reclamation equipment, including
25    replacement parts  and  equipment,  and  including  equipment
26    purchased for lease, but excluding motor vehicles required to
27    be registered under the Illinois Vehicle Code.
28        (22)  Fuel  and  petroleum products sold to or used by an
29    air  carrier,  certified  by  the  carrier  to  be  used  for
30    consumption, shipment, or  storage  in  the  conduct  of  its
31    business  as an air common carrier, for a flight destined for
32    or returning from a location or locations outside the  United
33    States  without  regard  to  previous  or subsequent domestic
34    stopovers.
 
                            -29-               LRB9111356SMdv
 1        (23)  A  transaction  in  which  the  purchase  order  is
 2    received by a florist who is located  outside  Illinois,  but
 3    who has a florist located in Illinois deliver the property to
 4    the purchaser or the purchaser's donee in Illinois.
 5        (24)  Fuel  consumed  or  used in the operation of ships,
 6    barges, or vessels that are used  primarily  in  or  for  the
 7    transportation  of  property or the conveyance of persons for
 8    hire on rivers  bordering  on  this  State  if  the  fuel  is
 9    delivered  by  the  seller to the purchaser's barge, ship, or
10    vessel while it is afloat upon that bordering river.
11        (25)  A motor vehicle sold in this State to a nonresident
12    even though the motor vehicle is delivered to the nonresident
13    in this State, if the motor vehicle is not to  be  titled  in
14    this  State, and if a driveaway decal permit is issued to the
15    motor vehicle as provided in Section 3-603  of  the  Illinois
16    Vehicle  Code  or  if  the  nonresident purchaser has vehicle
17    registration plates to transfer to  the  motor  vehicle  upon
18    returning  to  his  or  her  home state.  The issuance of the
19    driveaway   decal   permit   or   having   the   out-of-state
20    registration plates to be transferred is prima facie evidence
21    that the motor vehicle will not be titled in this State.
22        (26)  Semen used for artificial insemination of livestock
23    for direct agricultural production.
24        (27)  Horses, or interests in horses, registered with and
25    meeting the requirements of any of  the  Arabian  Horse  Club
26    Registry  of  America, Appaloosa Horse Club, American Quarter
27    Horse Association, United  States  Trotting  Association,  or
28    Jockey Club, as appropriate, used for purposes of breeding or
29    racing for prizes.
30        (28)  Computers and communications equipment utilized for
31    any  hospital  purpose  and  equipment used in the diagnosis,
32    analysis, or treatment of hospital patients sold to a  lessor
33    who leases the equipment, under a lease of one year or longer
34    executed  or  in  effect  at  the  time of the purchase, to a
 
                            -30-               LRB9111356SMdv
 1    hospital  that  has  been  issued  an  active  tax  exemption
 2    identification number by the Department under Section  1g  of
 3    this Act.
 4        (29)  Personal  property  sold to a lessor who leases the
 5    property, under a lease of one year or longer executed or  in
 6    effect  at  the  time of the purchase, to a governmental body
 7    that has been issued an active tax  exemption  identification
 8    number by the Department under Section 1g of this Act.
 9        (30)  Beginning  with  taxable  years  ending on or after
10    December 31, 1995 and ending with taxable years ending on  or
11    before  December  31, 2004, personal property that is donated
12    for disaster relief to  be  used  in  a  State  or  federally
13    declared disaster area in Illinois or bordering Illinois by a
14    manufacturer  or retailer that is registered in this State to
15    a   corporation,   society,   association,   foundation,   or
16    institution that  has  been  issued  a  sales  tax  exemption
17    identification  number by the Department that assists victims
18    of the disaster who reside within the declared disaster area.
19        (31)  Beginning with taxable years  ending  on  or  after
20    December  31, 1995 and ending with taxable years ending on or
21    before December 31, 2004, personal property that is  used  in
22    the  performance  of  infrastructure  repairs  in this State,
23    including but not limited to  municipal  roads  and  streets,
24    access  roads,  bridges,  sidewalks,  waste disposal systems,
25    water and  sewer  line  extensions,  water  distribution  and
26    purification  facilities,  storm water drainage and retention
27    facilities, and sewage treatment facilities, resulting from a
28    State or federally declared disaster in Illinois or bordering
29    Illinois  when  such  repairs  are  initiated  on  facilities
30    located in the declared disaster area within 6  months  after
31    the disaster.
32        (32)  Beginning  July 1, 1999, game or game birds sold at
33    a "game breeding and hunting preserve  area"  or  an  "exotic
34    game  hunting  area"  as those terms are used in the Wildlife
 
                            -31-               LRB9111356SMdv
 1    Code or at a hunting enclosure approved through rules adopted
 2    by the Department of Natural Resources.   This  paragraph  is
 3    exempt from the provisions of Section 2-70.
 4        (33)  (32)  A  motor  vehicle, as that term is defined in
 5    Section 1-146 of the Illinois Vehicle Code, that  is  donated
 6    to   a   corporation,  limited  liability  company,  society,
 7    association, foundation, or institution that is determined by
 8    the Department to be organized and operated  exclusively  for
 9    educational  purposes.   For  purposes  of this exemption, "a
10    corporation, limited liability company, society, association,
11    foundation, or institution organized and operated exclusively
12    for educational  purposes"  means  all  tax-supported  public
13    schools, private schools that offer systematic instruction in
14    useful  branches  of  learning  by  methods  common to public
15    schools  and  that  compare  favorably  in  their  scope  and
16    intensity with the course of study presented in tax-supported
17    schools, and vocational or technical  schools  or  institutes
18    organized  and  operated  exclusively  to provide a course of
19    study of not less than  6  weeks  duration  and  designed  to
20    prepare  individuals to follow a trade or to pursue a manual,
21    technical, mechanical, industrial,  business,  or  commercial
22    occupation.
23        (34) (33)  Beginning January 1, 2000,  personal property,
24    including  food, purchased through fundraising events for the
25    benefit of  a  public  or  private  elementary  or  secondary
26    school,  a  group  of  those  schools,  or one or more school
27    districts if the events are sponsored by an entity recognized
28    by the school district that consists primarily of  volunteers
29    and  includes  parents  and  teachers of the school children.
30    This paragraph does not apply to fundraising events  (i)  for
31    the benefit of private home instruction or (ii) for which the
32    fundraising  entity  purchases  the personal property sold at
33    the events from another individual or entity  that  sold  the
34    property  for the purpose of resale by the fundraising entity
 
                            -32-               LRB9111356SMdv
 1    and that profits from the sale  to  the  fundraising  entity.
 2    This paragraph is exempt from the provisions of Section 2-70.
 3        (35)   (32)  Beginning  January  1,  2000,  new  or  used
 4    automatic vending machines that prepare and  serve  hot  food
 5    and  beverages,  including coffee, soup, and other items, and
 6    replacement parts for  these  machines.   This  paragraph  is
 7    exempt from the provisions of Section 2-70.
 8        (36)  Beginning   January   1,  2001,  tangible  personal
 9    property   and   its   component   parts   purchased   by   a
10    telecommunications carrier if the property and parts are used
11    directly and primarily in transmitting, receiving, switching,
12    or  recording  any   interactive,   two-way   electromagnetic
13    communications,    including    voice,   image,   data,   and
14    information, through the use of any  medium,  including,  but
15    not  limited  to,  poles, wires, cables, switching equipment,
16    computers,  and  record  storage  devices  and  media.   This
17    paragraph is exempt from the provisions of Section 2-70.
18    (Source: P.A.  90-14,  eff.  7-1-97;  90-519,  eff.   6-1-98;
19    90-552,  eff.  12-12-97;  90-605,  eff.  6-30-98; 91-51, eff.
20    6-30-99; 91-200, eff. 7-20-99; 91-439, eff.  8-6-99;  91-533,
21    eff.  8-13-99;  91-637,  eff.  8-20-99; 91-644, eff. 8-20-99;
22    revised 9-28-99.)

23        Section 90.  The State Mandates Act is amended by  adding
24    Section 8.24 as follows:

25        (30 ILCS 805/8.24 new)
26        Sec.  8.24.  Exempt  mandate.  Notwithstanding Sections 6
27    and 8 of this Act, no reimbursement by the State is  required
28    for  the  implementation  of  any  mandate  created  by  this
29    amendatory Act of the 91st General Assembly.

30        Section  99.  Effective date.  This Act takes effect upon
31    becoming law.

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