Public Act 93-0167

HB2866 Enrolled                      LRB093 09861 SJM 10109 b

    AN ACT concerning coal.

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

    Section  5.  The  Department  of  Commerce  and Community
Affairs Law of the Civil Administrative Code of  Illinois  is
amended by changing Section 605-332 as follows:

    (20 ILCS 605/605-332)
    Sec.  605-332.  Financial assistance to energy generation
facilities.
    (a)  As used in this Section:
    "New    electric    generating    facility"    means    a
newly-constructed  electric  generation  plant  or  a   newly
constructed  generation  capacity  expansion  at  an existing
facility, including the  transmission  lines  and  associated
equipment that transfers electricity from points of supply to
points  of  delivery,  and  for which foundation construction
commenced not sooner than July 1, 2001, which is designed  to
provide   baseload   electric   generation   operating  on  a
continuous basis  throughout  the  year;  and  which  has  an
aggregate rated generating capacity of at least 400 megawatts
for  all  new  units  at one site, uses coal or gases derived
from coal as  its  primary  fuel  source,  and  supports  the
creation of at least 150 new Illinois coal mining jobs.
    "Eligible  business"  means  an  entity  that proposes to
construct a new electric generating  facility  and  that  has
applied  to  the  Department  to receive financial assistance
pursuant to this Section. With respect to use and  occupation
taxes, wherever there is a reference to taxes, that reference
means  only those taxes paid on Illinois-mined coal used in a
new electric generating facility.
    "Department" means the Illinois  Department  of  Commerce
and Community Affairs.
    (b)  The  Department  is  authorized to provide financial
assistance to eligible businesses for new electric generating
facilities from funds appropriated by the General Assembly as
further provided in this Section.
    An eligible business seeking qualification for  financial
assistance  for  a  new  electric  generating  facility,  for
purposes  of this Section only, shall apply to the Department
in the manner specified by the  Department.  Any  projections
provided  by  an eligible business as part of the application
shall be independently verified in a manner as set  forth  by
the  Department.  An  application  shall  include, but not be
limited to:
         (1)  the projected or actual completion date of  the
    new  electric  generating  facility  for  which financial
    assistance is sought;
         (2)  copies of documentation  deemed  acceptable  by
    the  Department  establishing  either (i) the total State
    occupation and use taxes paid on Illinois-mined coal used
    at the new electric generating facility for a minimum  of
    4  preceding  calendar  quarters  or  (ii)  the projected
    amount  of  State  occupation  and  use  taxes  paid   on
    Illinois-mined  coal  used at the new electric generating
    facility in 4 calendar year quarters after completion  of
    the  new  electric  generating  facility.  Bond  proceeds
    subject  to  this  Section  shall  not be allocated to an
    eligible  business  until  the  eligible   business   has
    demonstrated the revenue stream sufficient to service the
    debt on the bonds; and
         (3)  the  actual  or  projected  amount  of  capital
    investment  by  the eligible business in the new electric
    generating facility.
    The Department shall  determine  the  maximum  amount  of
financial  assistance  for  eligible businesses in accordance
with  this  paragraph.   The  Department  shall  not  provide
financial assistance from general obligation  bond  funds  to
any   eligible   business   unless   it  receives  a  written
certification from the Director of the Bureau of  the  Budget
that  80%  of the State occupation and use tax receipts for a
minimum of the preceding 4 calendar quarters for all eligible
businesses  or  as  included  in  projections   on   approved
applications  by  eligible businesses equal or exceed 110% of
the maximum annual debt  service  required  with  respect  to
general  obligation  bonds  issued  for  that  purpose.   The
Department may provide financial assistance not to exceed the
amount  of State general obligation debt calculated as above,
the amount of actual or projected capital investment  in  the
energy  generation  facility,  or  $100,000,000, whichever is
less. Financial assistance received pursuant to this  Section
may  be  used for capital facilities consisting of buildings,
structures, durable equipment, and land at the  new  electric
generating   facility.  Subject  to  the  provisions  of  the
agreement covering the financial assistance, a portion of the
financial assistance may be required  to  be  repaid  to  the
State  if  certain conditions for the governmental purpose of
the assistance were not met.
    An eligible business shall file a monthly report with the
Illinois  Department  of  Revenue  stating  the   amount   of
Illinois-mined  coal  purchased during the previous month for
use in the new electric  generating  facility,  the  purchase
price  of  that  coal, the amount of State occupation and use
taxes  paid  on  that  purchase  to   the   seller   of   the
Illinois-mined  coal,  and  such  other  information  as that
Department   may   reasonably   require.    In    sales    of
Illinois-mined  coal  between  related  parties, the purchase
price of the coal must have been determined in an arms-length
transaction.  The report shall be  filed  with  the  Illinois
Department of Revenue on or before the 20th day of each month
on  a  form  provided by that Department.  However, no report
need be filed by an eligible business in a month when it made
no reportable purchases of coal in the  previous  month.  The
Illinois  Department  of  Revenue  shall provide a summary of
such reports to the Bureau of the Budget.
    Upon  granting  financial  assistance  to   an   eligible
business,  the  Department  shall  certify  the  name  of the
eligible business to  the  Illinois  Department  of  Revenue.
Beginning  with  the  receipt  of  the  first report of State
occupation and use taxes paid by  an  eligible  business  and
continuing  for  a 25-year period, the Illinois Department of
Revenue shall each month pay into the  Energy  Infrastructure
Fund  80%  of the net revenue realized from the 6.25% general
rate on the selling price of  Illinois-mined  coal  that  was
sold to an eligible business.
(Source: P.A. 92-12, eff. 7-1-01.)

    Section  10.   The Illinois Development Finance Authority
Act is amended by changing Section 7.90 as follows:

    (20 ILCS 3505/7.90)
    Sec. 7.90.  Clean Coal and Energy Project Financing.
    (a)  Findings and declaration of policy.   It  is  hereby
found  and declared that Illinois has abundant coal resources
and, in some areas of Illinois, the demand for power  exceeds
the   generating   capacity.   Incentives  to  encourage  the
construction of  coal-fired  electric  generating  plants  in
Illinois  to ensure power-generating capacity into the future
are in the best interests of all of the citizens of Illinois.
The Authority is authorized to issue bonds  to  help  finance
Clean  Coal  and Energy projects pursuant to this Section and
under this Act.
    (b)  Definition. "Clean Coal and Energy  projects"  means
new  electric  generating  facilities,  as defined in Section
605-332 of the Department of Commerce and  Community  Affairs
Law  of  the Civil Administrative Code of Illinois, which may
include mine-mouth power plants, projects that employ the use
of clean coal technology,  projects  to  develop  alternative
energy sources, including renewable energy projects, projects
to provide scrubber technology for existing energy generating
plants,   or   projects   to  provide  electric  transmission
facilities.
    (c)  Creation  of  reserve  funds.   The  Authority   may
establish  and  maintain one or more reserve funds to enhance
bonds issued by the  Authority  for  Clean  Coal  and  Energy
projects  under  this  Section.   There  may  be  one or more
accounts in  these  reserve  funds  in  which  there  may  be
deposited:
         (1)  any  proceeds  of bonds issued by the Authority
    required to be deposited therein  by  the  terms  of  any
    contract between the Authority and its bondholders or any
    resolution of the Authority;
         (2)  any other moneys or funds of the Authority that
    it  may  determine  to  deposit  therein  from  any other
    source; and
         (3)  any other moneys or funds made available to the
    Authority.
    Subject to the terms of any pledge to the owners  of  any
bonds,  moneys in any reserve fund may be held and applied to
the payment of the interest, premium, if any, or principal of
bonds or for any other purpose authorized by the Authority.
    (d)  Powers and duties.  The Authority has the power:
         (1)  To issue bonds in one or more  series  pursuant
    to one or more resolutions of the Authority for any Clean
    Coal  and  Energy projects authorized under this Section,
    within  the  authorization  set  forth   in   subsections
    subsection (e) and (e-5).
         (2)  To  provide  for the funding of any reserves or
    other funds or accounts deemed necessary by the Authority
    in connection with any bonds issued by the Authority.
         (3)  To pledge any funds of the Authority  or  funds
    made  available  to  the Authority that may be applied to
    such purpose as security for any bonds or any guarantees,
    letters of credit, insurance contracts, or similar credit
    support or liquidity instruments securing the bonds.
         (4)  To enter  into  agreements  or  contracts  with
    third  parties,  whether  public  or  private, including,
    without limitation, the United  States  of  America,  the
    State, or any department or agency thereof, to obtain any
    appropriations,  grants,  loans,  or  guarantees that are
    deemed necessary or desirable by the Authority.  Any such
    guarantee, agreement, or contract may contain  terms  and
    provisions  necessary or desirable in connection with the
    program, subject to the requirements established  by  the
    Act.
         (5)  To  exercise such other powers as are necessary
    or incidental to the foregoing.
    (e)  Clean  Coal  and  Energy  bond   authorization   and
financing  limits.  In addition to any other bonds authorized
to  be  issued  under  this  Act,  the  Authority  may   have
outstanding, at any time, bonds for the purpose enumerated in
this  subsection (e) Section in an aggregate principal amount
that shall not exceed $3,000,000,000, of which no  more  than
$300,000,000   may   be   issued   to   finance  transmission
facilities, no  more  than  $500,000,000  may  be  issued  to
finance scrubbers at existing generating plants, no more than
$500,000,000  may  be  issued  to  finance alternative energy
sources, including renewable energy  projects,  and  no  more
than  $1,700,000,000  may  be  issued to finance new electric
generating facilities, as defined in Section 605-332  of  the
Department of Commerce and Community Affairs Law of the Civil
Administrative Code of Illinois, which may include mine-mouth
power  plants.   An application for a loan financed from bond
proceeds from a borrower or its affiliates for a  Clean  Coal
and  Energy  project may not be approved by the Authority for
an amount in excess of $450,000,000 for any borrower  or  its
affiliates.  These bonds shall not constitute an indebtedness
or  obligation  of  the  State  of  Illinois  and it shall be
plainly stated on the face of each  bond  that  it  does  not
constitute  an  indebtedness  or  obligation  of the State of
Illinois but is payable solely from the revenues, income,  or
other assets of the Authority pledged therefor.
    (e-5) Additional Clean Coal and Energy bond authorization
and   financing  limits.  In  addition  to  any  other  bonds
authorized to be issued under subsection (e),  the  Authority
may issue bonds for the purposes enumerated in subsection (e)
in  an  aggregate  principal  amount  that  shall  not exceed
$300,000,000.
    In the event that the Authority determines that the funds
pledged, intercepted, or otherwise received or to be received
by the Authority for the payment of the  principal,  premium,
if any, and interest during the next State fiscal year on any
bonds issued by the Authority under this subsection (e-5) for
the  specific  purposes  identified  in this subsection (e-5)
will not be sufficient for those payments, the  Chairman,  as
soon  as  is  practical,  shall  certify  to the Governor the
amount required by the Authority to  enable  it  to  pay  the
principal,  premium,  if any, and interest falling due on the
bonds. The Governor shall submit the amount so  certified  to
the  General Assembly as soon as practical, but no later than
the end of the current  State  fiscal  year.  This  paragraph
shall  not apply to any bonds as to which the Authority shall
have  determined,  in  the   resolution   authorizing   their
issuance,  that  this paragraph shall not apply. Whenever the
Authority makes such a  determination,  that  fact  shall  be
plainly  stated  on the face of the bonds and that fact shall
also be reported to the Governor.
    In the event of  a  withdrawal  of  moneys  from  a  debt
service reserve fund established with respect to any issue or
issues  of bonds of the Authority under this subsection (e-5)
to pay principal and interest on those bonds,  the  Chairman,
as  soon  as  is practical, shall certify to the Governor the
amount required to restore the  reserve  fund  to  the  level
required  in  the resolution or indenture securing the bonds.
The Governor shall submit the  amount  so  certified  to  the
General Assembly as soon as practical, but not later than the
end of the current State fiscal year.
    (f)  Criteria   for   participation   in   the   program.
Applications to the Authority for financing of any Clean Coal
and  Energy project shall be reviewed by the Authority.  Upon
submission of any such application, the Authority staff shall
review the application for its completeness and may,  at  the
discretion  of  the  Authority staff, request such additional
information as it deems necessary  or  advisable  to  aid  in
review.  If the Authority receives applications for financing
for  Clean  Coal  and  Energy  projects in excess of the bond
authorization available for such financing at any  one  time,
it shall consider applications in the order of priority as it
shall determine, in consultation with other State agencies.
(Source: P.A. 92-12, eff. 7-1-01.)

    Section  99.  Effective  date.   This Act takes effect on
July 1, 2003.