102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB1988

 

Introduced 2/17/2021, by Rep. Stephanie A. Kifowit

 

SYNOPSIS AS INTRODUCED:
 
65 ILCS 5/11-74.4-8  from Ch. 24, par. 11-74.4-8

    Amends the Tax Increment Allocation Redevelopment Act of the Illinois Municipal Code. Provides that, after the effective date of the amendatory Act, the municipal treasurer shall pay: (i) 25% of the money attributable to the increase in the current equalized assessed valuation of each taxable lot, block, tract, or parcel of real property in a redevelopment project area directly to school districts within the redevelopment project area in proportion to the percent of that amount that each school district would have received if there was no redevelopment project area; and (ii) the remaining 75% into the special tax allocation fund for the purpose of paying redevelopment project costs and obligations incurred in the payment thereof. Provides that, for redevelopment project areas established after the effective date of the amendatory Act, a school district within a proposed redevelopment project area may negotiate an additional percentage of money for the school district.


LRB102 13438 AWJ 18785 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB1988LRB102 13438 AWJ 18785 b

1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Municipal Code is amended by
5changing Section 11-74.4-8 as follows:
 
6    (65 ILCS 5/11-74.4-8)   (from Ch. 24, par. 11-74.4-8)
7    Sec. 11-74.4-8. Tax increment allocation financing. A
8municipality may not adopt tax increment financing in a
9redevelopment project area after July 30, 1997 (the effective
10date of Public Act 90-258) this amendatory Act of 1997 that
11will encompass an area that is currently included in an
12enterprise zone created under the Illinois Enterprise Zone Act
13unless that municipality, pursuant to Section 5.4 of the
14Illinois Enterprise Zone Act, amends the enterprise zone
15designating ordinance to limit the eligibility for tax
16abatements as provided in Section 5.4.1 of the Illinois
17Enterprise Zone Act. A municipality, at the time a
18redevelopment project area is designated, may adopt tax
19increment allocation financing by passing an ordinance
20providing that the ad valorem taxes, if any, arising from the
21levies upon taxable real property in such redevelopment
22project area by taxing districts and tax rates determined in
23the manner provided in paragraph (c) of Section 11-74.4-9 each

 

 

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1year after the effective date of the ordinance until
2redevelopment project costs and all municipal obligations
3financing redevelopment project costs incurred under this
4Division have been paid shall be divided as follows, provided,
5however, that with respect to any redevelopment project area
6located within a transit facility improvement area established
7pursuant to Section 11-74.4-3.3 in a municipality with a
8population of 1,000,000 or more, ad valorem taxes, if any,
9arising from the levies upon taxable real property in such
10redevelopment project area shall be allocated as specifically
11provided in this Section:
12        (a) That portion of taxes levied upon each taxable
13    lot, block, tract, or parcel of real property which is
14    attributable to the lower of the current equalized
15    assessed value or the initial equalized assessed value of
16    each such taxable lot, block, tract, or parcel of real
17    property in the redevelopment project area shall be
18    allocated to and when collected shall be paid by the
19    county collector to the respective affected taxing
20    districts in the manner required by law in the absence of
21    the adoption of tax increment allocation financing.
22        (b) Except from a tax levied by a township to retire
23    bonds issued to satisfy court-ordered damages, that
24    portion, if any, of such taxes which is attributable to
25    the increase in the current equalized assessed valuation
26    of each taxable lot, block, tract, or parcel of real

 

 

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1    property in the redevelopment project area over and above
2    the initial equalized assessed value of each property in
3    the project area shall be allocated to and when collected
4    shall be paid to the municipal treasurer who shall deposit
5    said taxes into a special fund called the special tax
6    allocation fund of the municipality for the purpose of
7    paying redevelopment project costs and obligations
8    incurred in the payment thereof; except that, after the
9    effective date of this amendatory Act of the 102nd General
10    Assembly, the treasurer shall pay: (i) 25% of the money
11    attributable to the increase in the current equalized
12    assessed valuation of each taxable lot, block, tract, or
13    parcel of real property in the redevelopment project area
14    directly to school districts within the redevelopment
15    project area in proportion to the percent of that amount
16    that each school district would have received if there was
17    no redevelopment project area; and (ii) the remaining 75%
18    into the special tax allocation fund for the purpose of
19    paying redevelopment project costs and obligations
20    incurred in the payment thereof. For redevelopment project
21    areas established after the effective date of this
22    amendatory Act of the 102nd General Assembly, a school
23    district within a proposed redevelopment project area may
24    negotiate an additional percentage of the money
25    attributable to the increase in the current equalized
26    assessed valuation of each taxable lot, block, tract, or

 

 

HB1988- 4 -LRB102 13438 AWJ 18785 b

1    parcel of real property in the redevelopment project other
2    than allowed by this subsection. In any county with a
3    population of 3,000,000 or more that has adopted a
4    procedure for collecting taxes that provides for one or
5    more of the installments of the taxes to be billed and
6    collected on an estimated basis, the municipal treasurer
7    shall be paid for deposit in the special tax allocation
8    fund of the municipality, from the taxes collected from
9    estimated bills issued for property in the redevelopment
10    project area, the difference between the amount actually
11    collected from each taxable lot, block, tract, or parcel
12    of real property within the redevelopment project area and
13    an amount determined by multiplying the rate at which
14    taxes were last extended against the taxable lot, block,
15    tract track, or parcel of real property in the manner
16    provided in subsection (c) of Section 11-74.4-9 by the
17    initial equalized assessed value of the property divided
18    by the number of installments in which real estate taxes
19    are billed and collected within the county; provided that
20    the payments on or before December 31, 1999 to a municipal
21    treasurer shall be made only if each of the following
22    conditions are met:
23            (1) The total equalized assessed value of the
24        redevelopment project area as last determined was not
25        less than 175% of the total initial equalized assessed
26        value.

 

 

HB1988- 5 -LRB102 13438 AWJ 18785 b

1            (2) Not more than 50% of the total equalized
2        assessed value of the redevelopment project area as
3        last determined is attributable to a piece of property
4        assigned a single real estate index number.
5            (3) The municipal clerk has certified to the
6        county clerk that the municipality has issued its
7        obligations to which there has been pledged the
8        incremental property taxes of the redevelopment
9        project area or taxes levied and collected on any or
10        all property in the municipality or the full faith and
11        credit of the municipality to pay or secure payment
12        for all or a portion of the redevelopment project
13        costs. The certification shall be filed annually no
14        later than September 1 for the estimated taxes to be
15        distributed in the following year; however, for the
16        year 1992 the certification shall be made at any time
17        on or before March 31, 1992.
18            (4) The municipality has not requested that the
19        total initial equalized assessed value of real
20        property be adjusted as provided in subsection (b) of
21        Section 11-74.4-9.
22        The conditions of paragraphs (1) through (4) do not
23    apply after December 31, 1999 to payments to a municipal
24    treasurer made by a county with 3,000,000 or more
25    inhabitants that has adopted an estimated billing
26    procedure for collecting taxes. If a county that has

 

 

HB1988- 6 -LRB102 13438 AWJ 18785 b

1    adopted the estimated billing procedure makes an erroneous
2    overpayment of tax revenue to the municipal treasurer,
3    then the county may seek a refund of that overpayment. The
4    county shall send the municipal treasurer a notice of
5    liability for the overpayment on or before the mailing
6    date of the next real estate tax bill within the county.
7    The refund shall be limited to the amount of the
8    overpayment.
9        It is the intent of this Division that after July 29,
10    1988 (the effective date of Public Act 85-1142) this
11    amendatory Act of 1988 a municipality's own ad valorem tax
12    arising from levies on taxable real property be included
13    in the determination of incremental revenue in the manner
14    provided in paragraph (c) of Section 11-74.4-9. If the
15    municipality does not extend such a tax, it shall annually
16    deposit in the municipality's Special Tax Increment Fund
17    an amount equal to 10% of the total contributions to the
18    fund from all other taxing districts in that year. The
19    annual 10% deposit required by this paragraph shall be
20    limited to the actual amount of municipally produced
21    incremental tax revenues available to the municipality
22    from taxpayers located in the redevelopment project area
23    in that year if: (a) the plan for the area restricts the
24    use of the property primarily to industrial purposes, (b)
25    the municipality establishing the redevelopment project
26    area is a home rule home-rule community with a 1990

 

 

HB1988- 7 -LRB102 13438 AWJ 18785 b

1    population of between 25,000 and 50,000, (c) the
2    municipality is wholly located within a county with a 1990
3    population of over 750,000 and (d) the redevelopment
4    project area was established by the municipality prior to
5    June 1, 1990. This payment shall be in lieu of a
6    contribution of ad valorem taxes on real property. If no
7    such payment is made, any redevelopment project area of
8    the municipality shall be dissolved.
9        If a municipality has adopted tax increment allocation
10    financing by ordinance and the County Clerk thereafter
11    certifies the "total initial equalized assessed value as
12    adjusted" of the taxable real property within such
13    redevelopment project area in the manner provided in
14    paragraph (b) of Section 11-74.4-9, each year after the
15    date of the certification of the total initial equalized
16    assessed value as adjusted until redevelopment project
17    costs and all municipal obligations financing
18    redevelopment project costs have been paid the ad valorem
19    taxes, if any, arising from the levies upon the taxable
20    real property in such redevelopment project area by taxing
21    districts and tax rates determined in the manner provided
22    in paragraph (c) of Section 11-74.4-9 shall be divided as
23    follows, provided, however, that with respect to any
24    redevelopment project area located within a transit
25    facility improvement area established pursuant to Section
26    11-74.4-3.3 in a municipality with a population of

 

 

HB1988- 8 -LRB102 13438 AWJ 18785 b

1    1,000,000 or more, ad valorem taxes, if any, arising from
2    the levies upon the taxable real property in such
3    redevelopment project area shall be allocated as
4    specifically provided in this Section:
5            (1) That portion of the taxes levied upon each
6        taxable lot, block, tract, or parcel of real property
7        which is attributable to the lower of the current
8        equalized assessed value or "current equalized
9        assessed value as adjusted" or the initial equalized
10        assessed value of each such taxable lot, block, tract,
11        or parcel of real property existing at the time tax
12        increment financing was adopted, minus the total
13        current homestead exemptions under Article 15 of the
14        Property Tax Code in the redevelopment project area
15        shall be allocated to and when collected shall be paid
16        by the county collector to the respective affected
17        taxing districts in the manner required by law in the
18        absence of the adoption of tax increment allocation
19        financing.
20            (2) That portion, if any, of such taxes which is
21        attributable to the increase in the current equalized
22        assessed valuation of each taxable lot, block, tract,
23        or parcel of real property in the redevelopment
24        project area, over and above the initial equalized
25        assessed value of each property existing at the time
26        tax increment financing was adopted, minus the total

 

 

HB1988- 9 -LRB102 13438 AWJ 18785 b

1        current homestead exemptions pertaining to each piece
2        of property provided by Article 15 of the Property Tax
3        Code in the redevelopment project area, shall be
4        allocated to and when collected shall be paid to the
5        municipal Treasurer, who shall deposit said taxes into
6        a special fund called the special tax allocation fund
7        of the municipality for the purpose of paying
8        redevelopment project costs and obligations incurred
9        in the payment thereof; except that, after the
10        effective date of this amendatory Act of the 102nd
11        General Assembly, the treasurer shall pay: (i) 25%
12        such taxes directly to school districts within the
13        redevelopment project area in proportion to the
14        percent of that amount that each school district would
15        have received if there was no redevelopment project
16        area; and (ii) the remaining 75% into the special tax
17        allocation fund of the municipality for the purpose of
18        paying redevelopment project costs and obligations
19        incurred in the payment thereof. For redevelopment
20        project areas established after the effective date of
21        this amendatory Act of the 102nd General Assembly, a
22        school district within a proposed redevelopment
23        project area may negotiate an additional percentage of
24        such taxes other than allowed by this paragraph.
25        The municipality may pledge in the ordinance the funds
26    in and to be deposited in the special tax allocation fund

 

 

HB1988- 10 -LRB102 13438 AWJ 18785 b

1    for the payment of such costs and obligations. No part of
2    the current equalized assessed valuation of each property
3    in the redevelopment project area attributable to any
4    increase above the total initial equalized assessed value,
5    or the total initial equalized assessed value as adjusted,
6    of such properties shall be used in calculating the
7    general State aid formula, provided for in Section 18-8 of
8    the School Code, or the evidence-based funding formula,
9    provided for in Section 18-8.15 of the School Code, until
10    such time as all redevelopment project costs have been
11    paid as provided for in this Section.
12        Whenever a municipality issues bonds for the purpose
13    of financing redevelopment project costs, such
14    municipality may provide by ordinance for the appointment
15    of a trustee, which may be any trust company within the
16    State, and for the establishment of such funds or accounts
17    to be maintained by such trustee as the municipality shall
18    deem necessary to provide for the security and payment of
19    the bonds. If such municipality provides for the
20    appointment of a trustee, such trustee shall be considered
21    the assignee of any payments assigned by the municipality
22    pursuant to such ordinance and this Section. Any amounts
23    paid to such trustee as assignee shall be deposited in the
24    funds or accounts established pursuant to such trust
25    agreement, and shall be held by such trustee in trust for
26    the benefit of the holders of the bonds, and such holders

 

 

HB1988- 11 -LRB102 13438 AWJ 18785 b

1    shall have a lien on and a security interest in such funds
2    or accounts so long as the bonds remain outstanding and
3    unpaid. Upon retirement of the bonds, the trustee shall
4    pay over any excess amounts held to the municipality for
5    deposit in the special tax allocation fund.
6        When such redevelopment projects costs, including,
7    without limitation, all municipal obligations financing
8    redevelopment project costs incurred under this Division,
9    have been paid, all surplus funds then remaining in the
10    special tax allocation fund shall be distributed by being
11    paid by the municipal treasurer to the Department of
12    Revenue, the municipality and the county collector; first
13    to the Department of Revenue and the municipality in
14    direct proportion to the tax incremental revenue received
15    from the State and the municipality, but not to exceed the
16    total incremental revenue received from the State or the
17    municipality less any annual surplus distribution of
18    incremental revenue previously made; with any remaining
19    funds to be paid to the County Collector who shall
20    immediately thereafter pay said funds to the taxing
21    districts in the redevelopment project area in the same
22    manner and proportion as the most recent distribution by
23    the county collector to the affected districts of real
24    property taxes from real property in the redevelopment
25    project area.
26        Upon the payment of all redevelopment project costs,

 

 

HB1988- 12 -LRB102 13438 AWJ 18785 b

1    the retirement of obligations, the distribution of any
2    excess monies pursuant to this Section, and final closing
3    of the books and records of the redevelopment project
4    area, the municipality shall adopt an ordinance dissolving
5    the special tax allocation fund for the redevelopment
6    project area and terminating the designation of the
7    redevelopment project area as a redevelopment project
8    area. Title to real or personal property and public
9    improvements acquired by or for the municipality as a
10    result of the redevelopment project and plan shall vest in
11    the municipality when acquired and shall continue to be
12    held by the municipality after the redevelopment project
13    area has been terminated. Municipalities shall notify
14    affected taxing districts prior to November 1 if the
15    redevelopment project area is to be terminated by December
16    31 of that same year. If a municipality extends estimated
17    dates of completion of a redevelopment project and
18    retirement of obligations to finance a redevelopment
19    project, as allowed by Public Act 87-1272 this amendatory
20    Act of 1993, that extension shall not extend the property
21    tax increment allocation financing authorized by this
22    Section. Thereafter the rates of the taxing districts
23    shall be extended and taxes levied, collected and
24    distributed in the manner applicable in the absence of the
25    adoption of tax increment allocation financing.
26        If a municipality with a population of 1,000,000 or

 

 

HB1988- 13 -LRB102 13438 AWJ 18785 b

1    more has adopted by ordinance tax increment allocation
2    financing for a redevelopment project area located in a
3    transit facility improvement area established pursuant to
4    Section 11-74.4-3.3, for each year after the effective
5    date of the ordinance until redevelopment project costs
6    and all municipal obligations financing redevelopment
7    project costs have been paid, the ad valorem taxes, if
8    any, arising from the levies upon the taxable real
9    property in that redevelopment project area by taxing
10    districts and tax rates determined in the manner provided
11    in paragraph (c) of Section 11-74.4-9 shall be divided as
12    follows:
13            (1) That portion of the taxes levied upon each
14        taxable lot, block, tract, or parcel of real property
15        which is attributable to the lower of (i) the current
16        equalized assessed value or "current equalized
17        assessed value as adjusted" or (ii) the initial
18        equalized assessed value of each such taxable lot,
19        block, tract, or parcel of real property existing at
20        the time tax increment financing was adopted, minus
21        the total current homestead exemptions under Article
22        15 of the Property Tax Code in the redevelopment
23        project area shall be allocated to and when collected
24        shall be paid by the county collector to the
25        respective affected taxing districts in the manner
26        required by law in the absence of the adoption of tax

 

 

HB1988- 14 -LRB102 13438 AWJ 18785 b

1        increment allocation financing.
2            (2) That portion, if any, of such taxes which is
3        attributable to the increase in the current equalized
4        assessed valuation of each taxable lot, block, tract,
5        or parcel of real property in the redevelopment
6        project area, over and above the initial equalized
7        assessed value of each property existing at the time
8        tax increment financing was adopted, minus the total
9        current homestead exemptions pertaining to each piece
10        of property provided by Article 15 of the Property Tax
11        Code in the redevelopment project area, shall be
12        allocated to and when collected shall be paid by the
13        county collector as follows:
14                (A) First, that portion which would be payable
15            to a school district whose boundaries are
16            coterminous with such municipality in the absence
17            of the adoption of tax increment allocation
18            financing, shall be paid to such school district
19            in the manner required by law in the absence of the
20            adoption of tax increment allocation financing;
21            then
22                (B) 80% of the remaining portion shall be paid
23            to the municipal Treasurer, who shall deposit said
24            taxes into a special fund called the special tax
25            allocation fund of the municipality for the
26            purpose of paying redevelopment project costs and

 

 

HB1988- 15 -LRB102 13438 AWJ 18785 b

1            obligations incurred in the payment thereof; and
2            then
3                (C) 20% of the remaining portion shall be paid
4            to the respective affected taxing districts, other
5            than the school district described in clause (a)
6            above, in the manner required by law in the
7            absence of the adoption of tax increment
8            allocation financing.
9    Nothing in this Section shall be construed as relieving
10property in such redevelopment project areas from being
11assessed as provided in the Property Tax Code or as relieving
12owners of such property from paying a uniform rate of taxes, as
13required by Section 4 of Article IX of the Illinois
14Constitution.
15(Source: P.A. 99-792, eff. 8-12-16; 100-465, eff. 8-31-17;
16revised 8-8-19.)