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093_HB0235ham001
LRB093 02644 AMC 10063 a
1 AMENDMENT TO HOUSE BILL 235
2 AMENDMENT NO. . Amend House Bill 235 by replacing
3 the title with the following:
4 "AN ACT concerning corporations."; and
5 by replacing everything after the enacting clause with the
6 following:
7 "Section 1. Short title. This Act may be cited as the
8 Corporate Accountability for Tax Expenditures Act.
9 Section 5. Definitions. As used in this Act:
10 "Affiliated group" means the recipient, its corporate
11 parent (if any), all other subsidiaries such corporate parent
12 owns, and all other businesses with substantially similar
13 ownership.
14 "Base years" means the first 2 complete calendar years
15 following the effective date of a recipient receiving
16 development assistance.
17 "Corporate parent" means any person or legal entity,
18 organization, business, partnership, group, or corporate
19 entity recognized by law, or combination thereof, that
20 possesses, owns, or controls an interest greater than 50% of
21 the recipient.
-2- LRB093 02644 AMC 10063 a
1 "Date of assistance" means the date upon which a granting
2 body transmits the first dollar value of development
3 assistance to a recipient.
4 "Default" means that a recipient has not achieved its job
5 creation or wage or benefit goals, or the affiliated group
6 has not maintained 90% of its State employment, as long as
7 the subsidy is in effect, or 10 years, whichever is longer.
8 "Development assistance" means any form of public
9 assistance, including both direct and indirect on-budget and
10 off-budget assistance, including tax expenditures, made for
11 the purpose of stimulating economic development of a given
12 corporation, industry, geographic jurisdiction, or other
13 subset of the State's economy, including but not limited to
14 industrial development bonds, training grants, loans, loan
15 guarantees, enterprise zones, empowerment zones, tax
16 increment financing, grants, fee waivers, land price
17 subsidies, infrastructure whose principal beneficiary is a
18 single business or defined group of businesses at the time it
19 is built or improved, matching funds, tax abatements, tax
20 credits, and tax discounts of every kind, including corporate
21 income, personal income, sales, use, raw materials, job
22 creation, industrial investment, excise, utility, inventory,
23 accelerated depreciation, and research and development tax
24 credits and discounts.
25 "Full-time, permanent job" means a job in which the new
26 employee works for the recipient at a rate of at least 35
27 hours per week.
28 "Granting body" means any public entity within the State,
29 including local governments, regional development
30 organizations, State and local public corporations, the State
31 government, and any State department or agency that provides
32 development assistance, including but not limited to the
33 Department of Commerce and Community Affairs, Department of
34 Employment Security, workforce development boards, economic
-3- LRB093 02644 AMC 10063 a
1 development commissions, industrial development authorities,
2 regional development authorities, and finance authorities.
3 "In effect" refers to any calendar year within the
4 duration of the development assistance, including but not
5 limited to the duration of any loan, loan guarantee, tax
6 credit or tax credit carryforward, property tax reduction or
7 abatement, or tax increment financing. For one-time forms of
8 development assistance such as grants and land price
9 subsidies, "in effect" refers to a period of not less than 5
10 years from the date of assistance.
11 "Part-time job" means a job in which the new employee
12 works for the recipient at a rate of less than 35 hours per
13 week.
14 "Permanent job" means a job in which a new employee works
15 for the recipient, not as an independent contractor or on a
16 consulting basis, at a rate of at least 35 hours per week
17 with the intention that such employment shall continue and
18 that the employee will receive all health insurance, pension,
19 profit sharing, and other benefits offered to other
20 full-time, permanent employees.
21 "Property-taxing entity" means every entity in the State
22 that levies taxes upon real property.
23 "Recipient" means any business that claims development
24 assistance. A business is any corporation, limited liability
25 company, partnership, joint venture, association, sole
26 proprietorship, or other legally recognized entity that
27 claims any development assistance.
28 "Small businesses" means those corporations whose
29 corporate parents, and all subsidiaries thereof, employed
30 fewer than an average of 49 full-time, permanent equivalent
31 employees.
32 "Specific project site" means that distinct operational
33 unit to which any development assistance is applied.
34 "Subsidiary" means any person or legal entity,
-4- LRB093 02644 AMC 10063 a
1 organization, business, partnership, group, or corporate
2 entity recognized by law, or any combination thereof, in
3 which the affiliated group possesses, owns, or controls an
4 interest greater than 50%.
5 "Substantially similar" means at least 51% of equity
6 interests are owned either legally or beneficially by the
7 same individual or entities.
8 "Temporary job" means a job in which the new employee is
9 hired for a specific duration of time or season.
10 "Value of assistance" means the face value of any form of
11 development assistance, such as a bond amount.
12 "New employee" means a full-time, permanent employee who
13 represents a net increase in the number of the affiliated
14 group's employees statewide. "New employee" includes an
15 employee who previously filled a new employee position with
16 any member of the affiliated group who was rehired or called
17 back from a layoff that occurs during or following the base
18 years.
19 The term "New Employee" does not include any of the
20 following:
21 (1) An employee of the affiliated group who
22 performs a job that was previously performed by another
23 employee, if that job existed for at least 6 months
24 before hiring the employee.
25 (2) An employee of the recipient who was previously
26 employed in Illinois by the affiliated group and whose
27 employment was shifted to the recipient after the
28 recipient entered into any sort of agreement to receive
29 development assistance.
30 (3) A child, grandchild, parent, or spouse, other
31 than a spouse who is legally separated from the
32 individual, of any individual who has a direct or
33 indirect ownership interest of at least 5% in the
34 profits, capital, or value of any member of the
-5- LRB093 02644 AMC 10063 a
1 affiliated group.
2 (4) An employee of the recipient who previously
3 worked for any member of the affiliated group outside of
4 Illinois prior to the Date of Assistance.
5 Section 10. Unified Economic Development Budget.
6 (a) The Department of Revenue shall submit an annual
7 Unified Economic Development Budget to the General Assembly
8 no later than 3 months after the end of the State's fiscal
9 year. The report shall present all types of development
10 assistance for economic development during the prior fiscal
11 year, including but not limited to:
12 (1) The amount of uncollected or diverted state tax
13 revenues resulting from development assistance provided
14 by the State or a local governmental unit including but
15 not limited to gross receipts, income, sales, use, raw
16 materials, excise, property, utility, and inventory
17 taxes.
18 (2) The name of each recipient that claimed any
19 development assistance under subdivision (1) of any value
20 equal to or greater than $50,000, whether from single or
21 multiple sources, together with the dollar amount
22 received by each such recipient.
23 (3) Any development assistance received by a
24 recipient totaling less than $50,000 each shall not be
25 itemized. The Department of Revenue shall report an
26 aggregate dollar amount of such development assistance
27 and the number of recipients so aggregated for each type
28 of development assistance.
29 (4) All State appropriated development assistance
30 for economic development, including line-item budgets for
31 every State-funded entity concerned with economic
32 development, including but not limited to State
33 Department of Commerce, State Department of Employment
-6- LRB093 02644 AMC 10063 a
1 and Training, vocational education programs, State
2 university research programs, manufacturing extension
3 service, Workforce Investment Boards, Economic
4 Development Commissions, Industrial Development
5 Authorities, Regional Development Authorities, and
6 Finance Authorities.
7 (b) All data produced by the Department of Revenue and
8 received by the General Assembly in compliance with this Act
9 shall be fully subject to the Freedom of Information Act.
10 Section 15. Disclosure of property tax reductions and
11 abatements.
12 (a) On or before April 1, 2004, the Department of
13 Revenue shall promulgate a standardized disclosure registry
14 for use by all property-taxing entities. The form shall
15 require, but not be limited to, the following data:
16 (1) The name of the property owner.
17 (2) The address and description of the property.
18 (3) The date upon which any individual property tax
19 reduction or abatement first took effect.
20 (4) The date upon which any individual property tax
21 reduction or abatement is scheduled to expire.
22 (5) The rate or schedule of each individual
23 property tax reduction or abatement for the period
24 between the date it took effect and the date it is
25 scheduled to expire.
26 (6) The entity's aggregate foregone revenue for the
27 calendar year as a result of each property tax reduction
28 or abatement.
29 (7) A compilation and summary of the entity's total
30 foregone revenue as a result of all property tax
31 reductions or abatements, including a summary of foregone
32 revenue for each kind of reduction or abatement.
33 (8) The respective shares of the entity's property
-7- LRB093 02644 AMC 10063 a
1 tax revenues in the reported year that went to each
2 designated public agency, including but not limited to
3 school boards, general funds, public safety agencies,
4 fire departments, park districts, and general
5 administration.
6 (b) Beginning April 1, 2004 and for each year
7 thereafter, every property-taxing entity in the State shall
8 employ this standardized registry to report to the State
9 Department of Revenue all property tax reductions or
10 abatements that had effect during the previous calendar year.
11 (c) The Department of Revenue shall, by June 1, 2004 and
12 each year thereafter, compile and publish all data in all of
13 the disclosure registries in both written and electronic
14 form.
15 (d) If a property-taxing entity fails to comply with
16 subsection (b) of this Section, the Department of Revenue
17 shall, within 10 working days after the April 1 filing
18 deadline, notify the Department of Commerce and Community
19 Affairs of that failure. Upon receipt of the notice, the
20 Department of Commerce and Community Affairs shall suspend
21 within 33 working days any current development assistance
22 activities under its control in the property-taxing entity's
23 jurisdiction, and shall be prohibited from completing any
24 current development assistance or providing any future
25 development assistance in the non-compliant jurisdiction
26 until it receives proof from the Department of Revenue that
27 the property taxing entity has complied with subsection (b)
28 of this Section.
29 (e) All data generated in compliance with subsections
30 (a) and (b) are fully subject to the Freedom of Information
31 Act.
32 Section 20. Standardized applications for on-budget
33 development.
-8- LRB093 02644 AMC 10063 a
1 (a) On or before April 1, 2004, the Department of
2 Commerce and Community Affairs shall promulgate a
3 standardized application form for on-budget development
4 assistance for use by all granting bodies. The form shall
5 require, but not be limited to, the following data:
6 (1) An application tracking number that is specific
7 to both the granting agency and to each application.
8 (2) The name, street and mailing addresses, phone
9 number, and chief officer of the granting body.
10 (3) The name, street and mailing addresses, phone
11 number, and chief officer of the corporate parent of the
12 applicant corporation.
13 (4) The name, street and mailing addresses, phone
14 number, 4-digit SIC number, and chief officer of the
15 applicant corporation at the specific project site for
16 which development assistance is sought.
17 (5) The applicant corporation's total number of
18 employees at the specific project site on the date of the
19 application, broken down by full-time, permanent,
20 part-time, and temporary.
21 (6) The total number of employees in the State of
22 the applicant corporation's corporate parent, and all
23 subsidiaries thereof, as of December 1 of the year
24 preceding the date of application, broken down by
25 full-time, permanent, part-time, and temporary.
26 (7) The kind of development assistance and value of
27 assistance being applied for.
28 (8) The number of new jobs to be created by the
29 development assistance, broken down by full-time,
30 permanent, part-time, and temporary.
31 (9) The average hourly wage to be paid within one
32 year of hiring to the new employees, broken down by
33 number of full-time, permanent, part-time, and temporary
34 employees, and broken down by wage bands as follows: $6
-9- LRB093 02644 AMC 10063 a
1 or less an hour, $6.01 to $7 an hour, $7.01 to $8 an
2 hour, $8.01 to $9 an hour, $9.01 to $10 an hour, $10.01
3 to $11 an hour, $11.01 to $12 an hour, $12.01 to $13 an
4 hour, $13.01 to $14 an hour, and $14.01 or more per hour.
5 (10) For applicant project sites located in a
6 Metropolitan Statistical Area, as defined by the U.S.
7 Census Bureau, the average hourly wage paid to non-
8 managerial employees in the applicant's industry in the
9 State, as most recently provided by the U.S. Bureau of
10 Labor Statistics to the 2 or 3-digit SIC number
11 specification, as available.
12 (11) For applicant project sites located outside of
13 Metropolitan Statistical Areas, the average weekly wage
14 paid in the county, as most recently reported by the U.S.
15 Department of Commerce in its County Business Patterns
16 reports.
17 (12) The nature of employer-paid health care
18 coverage to be provided within 90 days of hiring to the
19 employees filling the new jobs, including any costs to be
20 borne by the new employees.
21 (13) A list of all other forms of development
22 assistance the applicant corporation is seeking for the
23 specific project site, and the name of each granting body
24 from which that development assistance is being sought.
25 (14) A narrative, if necessary, describing how the
26 applicant's use of the development assistance may reduce
27 employment at any site in any United States jurisdiction
28 controlled by the applicant corporation or its corporate
29 parent, including but not limited to events such as
30 automation, consolidation, merger, acquisition, product
31 line movement, business activity movement, or
32 restructuring by either the applicant corporation or its
33 corporate parent.
34 (15) Individual certifications by the chief
-10- LRB093 02644 AMC 10063 a
1 officers of both the applicant corporation and the
2 granting body as to the accuracy of the application,
3 under penalty of perjury.
4 (b) Beginning April 1, 2004, every granting body in the
5 State, jointly with applicant corporations, shall fill out
6 the standardized application form as prescribed in this
7 Section each time a corporation applies for development
8 assistance.
9 Section 25. On-budget development assistance disclosure.
10 (a) Beginning February 1, 2005 and each year thereafter,
11 every granting body in the State shall submit to the
12 Department of Commerce and Community Affairs copies of all
13 the standardized applications forms for development
14 assistance that it has received in the previous calendar
15 year. Upon each form, the granting body shall designate
16 whether the development assistance is pending, was approved,
17 or was not approved, and for those applications that were
18 approved, the date of assistance if the date of assistance
19 occurred in the previous calendar year.
20 (b) For those applications that were approved but for
21 which the date of assistance did not occur in the same
22 calendar year, each granting body shall report in its next
23 subsequent February 1 annual report to the Department
24 relevant dates of assistance.
25 (c) For each development assistance application that was
26 approved, except for small businesses as defined in this Act,
27 and for which the date of assistance has occurred in a
28 reporting year, each granting agency shall submit to the
29 Department of Commerce and Community Affairs a progress
30 report that shall include, but not limited to, the following
31 data:
32 (1) The application tracking number.
33 (2) The name, street and mailing addresses, phone
-11- LRB093 02644 AMC 10063 a
1 number, and chief officer of the granting body.
2 (3) The name, street and mailing addresses, phone
3 number, 4-digit SIC number, and chief officer of the
4 corporation at the specific project site for which the
5 development assistance was approved.
6 (4) The kind of development assistance and value of
7 assistance that was approved.
8 (5) The applicant's total level of employment at
9 the specific project site on the date of the application
10 and the applicant's total level of employment at the
11 specific project site on the date of the report, broken
12 down by full-time, permanent, part-time, and temporary,
13 and a computation of the gain or loss in each category.
14 (6) The number of new jobs the applicant
15 corporation stated in its application would be created by
16 the development assistance, broken down by full-time,
17 permanent, part-time, and temporary.
18 (7) The total level of employment in the State of
19 the applicant's corporate parent, and all subsidiaries
20 thereof, as of December 31 of the year preceding the date
21 of application and the total level of employment in the
22 State of the applicant's corporate parent, and all
23 subsidiaries thereof, as of each December 31 up through
24 the reporting year, broken down by full-time, permanent,
25 part-time, and temporary, and a statement of the gain or
26 loss in each category from the earliest reported year to
27 the most recent.
28 (8) The average hourly wage paid as of December 31
29 of the reporting year to employees filling the new jobs
30 at the specific project site, broken down by full- time,
31 permanent, part-time, and temporary, and broken down by
32 wage bands as follows: $6.00 or less an hour, $6.01 to $7
33 an hour; $7.01 to $8.00 an hour; $8.01 to $9.00 an hour;
34 $9.01 to $10 an hour; $10.01 to $11.00 an hour; $11.01 to
-12- LRB093 02644 AMC 10063 a
1 $12.00 an hour; $13.01 to $13.00 an hour; $13.01 to
2 $14.00 an hour; and $14.01 or more an hour. The average
3 hourly wage paid as of December 31 of the reporting year
4 to employees filling the new jobs at the specific project
5 site, broken down by full-time, permanent, part-time, and
6 temporary.
7 (9) The nature of employer-paid health care
8 coverage being provided within 90 days of hiring to the
9 employees filling the new jobs, including any costs being
10 borne by the new employees.
11 (10) A narrative, if necessary, describing how the
12 recipient's use of the development assistance during the
13 reporting year has reduced employment at any site in any
14 United States jurisdiction controlled by the applicant or
15 its corporate parent, including but not limited to events
16 such as automation, consolidation, merger, acquisition,
17 product line movement, business activity movement, or
18 restructuring by either the applicant or its corporate
19 parent.
20 (11) Signed individual certifications by the chief
21 officers of both the applicant corporation and the
22 granting body as to the accuracy of the progress report,
23 under penalty of perjury.
24 (d) The granting body and the Department of Commerce and
25 Community Affairs, or any successor agency, all have full
26 investigative authority to verify the applicant's progress
27 report data, including but not limited to inspection of the
28 specific project site and analysis of tax and payroll
29 records.
30 (e) By June 1, 2005 and by June 1 of each year
31 thereafter, the Department of Commerce and Community Affairs
32 shall compile and publish all data in all of the development
33 assistance progress reports in both written and electronic
34 form.
-13- LRB093 02644 AMC 10063 a
1 (f) Every aspect all development assistance
2 applications, progress reports, and the Department of
3 Commerce and Community Affairs' compilation of applications
4 and progress reports shall be fully subject to the Freedom of
5 Information Act.
6 (g) If a granting body fails to comply with subsections
7 (a) through (c), the Department of Commerce and Community
8 Affairs shall, within 10 working days of the February 1
9 filing deadline, suspend any current development assistance
10 activities under its control in the body's jurisdiction, and
11 shall be prohibited from proceeding with any current or
12 future development assistance activities under its control in
13 the granting body's jurisdiction, until it receives proof
14 that the negligent granting body or recipient has complied
15 with this Act.
16 Section 30. Job creation and job quality standards.
17 (a) In considering development assistance applications,
18 all granting bodies shall perform 2 analyses concerning the
19 projected wages and benefits. Specifically:
20 (1) In considering development assistance
21 applications, all granting bodies shall compare the
22 aggregate projected wage with existing wages. To derive
23 the aggregate projected wage, the granting body shall
24 compute the weighted hourly average wage for all new
25 employees, including full-time, permanent, part-time, and
26 temporary employees. If the aggregate projected wage is
27 less than 85% of existing wages, the application shall be
28 denied. For small businesses, if the aggregate projected
29 wage is less than 75% of existing wages, the application
30 shall be denied.
31 (2) In considering development assistance
32 applications, all granting bodies shall perform a second
33 wage computation to consider the value of health care
-14- LRB093 02644 AMC 10063 a
1 coverage provided to full-time, permanent employees. If
2 the applicant corporation is not providing health care
3 coverage to full-time, permanent employees, the granting
4 body shall subtract $1.50 an hour from the projected
5 wage. If the recipient projects some health care costs to
6 be borne by the new full-time, permanent employees, the
7 granting body shall, based on data from the applicant
8 corporation, estimate the hourly cost to the new
9 full-time, permanent employee of those costs and subtract
10 that amount from the projected wage. If the amount
11 resulting from the subtraction is less than 80% of
12 existing wages, the application shall be denied. For
13 small Businesses, if the amount resulting from the
14 subtraction is less than 70% of existing wages, the
15 application shall be denied.
16 (b) Granting bodies shall perform a third eligibility
17 analysis. In considering development assistance applications,
18 all granting bodies shall divide the value of assistance by
19 the number of projected full-time, permanent jobs. If the
20 resulting sum exceeds $35,000, the application shall be
21 denied.
22 (c) Nothing in this Act shall be read to require or
23 authorize any recipient corporation to reduce wages
24 established by any collective bargaining agreement or state
25 or federal prevailing wage law.
26 Section 35. Recapture.
27 (a) Recipients are required to achieve their job
28 creation and wage and benefit goals within 2 years after the
29 date of assistance. They are also required to maintain their
30 wage and benefit goals as long as the benefit is in effect,
31 or 5 years, whichever is longer. Affiliated groups of
32 recipients are required to maintain at least 90% of their
33 original State employment.
-15- LRB093 02644 AMC 10063 a
1 (b) Granting bodies shall within 10 working days after
2 the second anniversary of the date of assistance, fill out a
3 standardized progress report and the recipient shall sign it
4 and certify its accuracy under penalty of perjury. This
5 second anniversary progress report shall be filed by the
6 granting body with the Department of Commerce and Community
7 Affairs along with the granting body's next annual filing of
8 progress reports.
9 (c) The granting body shall indicate on this second
10 anniversary progress report whether the recipient has
11 achieved its job creation and wage and benefit goals, and
12 whether the affiliated group has maintained 90% of its State
13 employment.
14 (d) On all subsequent annual progress reports, the
15 granting body shall indicate whether or not the recipient
16 corporation is still in compliance with its job creation and
17 wage and benefit goals, and whether the corporate parent is
18 still in compliance with its State employment maintenance
19 requirement.
20 (e) If on any progress report occasion, beginning with
21 the second anniversary progress report, a granting body finds
22 that a recipient corporation has not achieved its job
23 creation or wage or benefit goals, or the affiliated group
24 has not maintained 90% of its State employment the granting
25 body must, within 10 working days, file a finding of
26 development assistance default with the Department of Revenue
27 and the recipient.
28 (f) If a recipient defaults on development assistance,
29 it must pay back to the granting body that fraction of the
30 development assistance that accrued to its benefit for the
31 calendar year in which the default occurred. For one time
32 forms of development assistance such as grants or land price
33 discounts, a defaulting recipient must pay back to the
34 granting body three-quarters of the value of assistance.
-16- LRB093 02644 AMC 10063 a
1 Remittance of the payback by the recipient corporation to the
2 granting body shall take place within 60 calendar days of the
3 delivery of the default notice to the recipient, unless the
4 granting body agrees, in writing, to extend such repayment
5 period for cause, up to a maximum of 365 days. For purposes
6 of the preceding, "cause" will mean imminent and demonstrable
7 hardship to the recipient that may result in such recipient's
8 insolvency or discharge of workers.
9 (g) If a recipient defaults on development assistance,
10 in 3 consecutive calendar years, the granting body shall
11 declare the development assistance void, and shall so notify
12 the Department of Commerce and Community Affairs and the
13 recipient. Upon this declaration, the recipient must pay back
14 to the granting body all remaining value of the development
15 assistance it has not already paid back. Remittance of the
16 void payback by the recipient corporation to the granting
17 body shall take place within 180 calendar days of the
18 delivery of the notice to the recipient, unless the granting
19 body agrees, in writing, to extend such repayment period for
20 cause, up to a maximum of 730 days. For purposes of the
21 preceding, "cause" will mean imminent and demonstrable
22 hardship to the recipient that may result in such recipient's
23 insolvency or discharge of workers.
24 (h) Every aspect of all development assistance default
25 notices, recapture remittances, associated correspondence,
26 and related proceedings shall be fully subject to the Freedom
27 of Information Act.
28 Section 99. Effective date. This Act takes effect upon
29 becoming law.".
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