HB0826ham001 101ST GENERAL ASSEMBLY

Rep. Michael J. Zalewski

Filed: 3/27/2019

10100HB0826ham001 LRB101 00256 AWJ 58035 a

AMENDMENT TO HOUSE BILL 826

AMENDMENT NO. ______. Amend House Bill 826 by replacing everything after the enacting clause with the following:

"Section 5. The Illinois Municipal Code is amended by adding Section 8-11-2.7 as follows:

(65 ILCS 5/8-11-2.7 new)

Sec. 8-11-2.7. Non-Home Rule Municipal Gas Use Tax.

(a) This Section may be cited as the Non-Home Rule Municipal Gas Use Tax Law.

(b) As used in this Section:

"Delivering supplier" means a person engaged in the business of delivering gas to another person for use or consumption and not for resale, and who, in any case where more than one person participates in the delivery of gas to a specific purchaser, is the last of the suppliers engaged in delivering the gas prior to its receipt by the purchaser.

"Delivering supplier maintaining a place of business in this State" means any delivering supplier having or maintaining within this State, directly or by a subsidiary, an office, distribution facility, sales office, or other place of business, or any employee, agent, or other representative operating within this State under the authority of the delivering supplier or the delivering supplier's subsidiary, irrespective of whether the place of business or agent or other representative is located in this State permanently or temporarily, or whether the delivering supplier or the delivering supplier's subsidiary is licensed to do business in this State.

"Gas" means any gaseous fuel distributed through a pipeline system.

"Person" means any natural individual, firm, trust, estate, partnership, association, joint stock company, joint adventure, corporation, or limited liability company, any receiver, trustee, guardian, or other representative appointed by order of any court, or any city, town, county, or other political subdivision of this State.

"Purchase of out-of-state gas" means a transaction for the purchase of gas from any supplier in a manner that does not subject the seller of that gas to liability for a tax imposed under paragraph 2 of Section 8-11-2 of the Illinois Municipal Code.

"Purchase price" means the consideration paid for the distribution, supply, furnishing, sale, transportation, or delivery of gas to a person for use or consumption and not for resale, and for all services directly related to the production, transportation, or distribution of gas distributed, supplied, furnished, sold, transmitted, or delivered for use or consumption, including cash, services, and property of every kind and nature. "Purchase price" does not include consideration paid for:

(1) a charge for a dishonored check;

(2) a finance or credit charge, penalty, charge for delayed payment, or discount for prompt payment;

(3) a charge for reconnection of service or for replacement or relocation of facilities;

(4) an advance or contribution in aid of construction;

(5) repair, inspection, or servicing of equipment located on customer premises;

(6) leasing or rental of equipment, the leasing or rental of which is not necessary to furnishing, supplying, or selling gas;

(7) a purchase by a purchaser if the supplier is prohibited by a federal or State constitution, treaty, convention, statute, or court decision from recovering the related tax liability from such purchaser; or

(8) an amount added to a purchaser's bill because of changes made pursuant to the tax imposed by the municipality.

(c) The privilege of using or consuming gas acquired in a purchase at retail and used or consumed within the corporate limits of a non-home rule municipality may be taxed at rates not to exceed the maximum rates, calculated on a monthly basis for each purchaser, as provided in this Section.

(d) Beginning January 1, 2020, a non-home rule municipality may impose upon the privilege of using in the municipality gas obtained in a purchase of out-of-state gas at the rate per therm established by the non-home rule municipality or 5% of the purchase price for the billing period, whichever is the lower rate. This tax rate is the self-assessing purchaser tax rate. Beginning with bills issued by delivering suppliers on and after January 1, 2020 to purchasers within a municipality imposing a tax pursuant to this Section, purchasers may elect an alternate tax rate per therm established by the non-home rule municipality to be paid under the provisions of subsection (e) to a delivering supplier maintaining a place of business in this State. The non-home rule municipality shall establish this alternate tax rate, not less than annually, a rate per therm that would not exceed a tax imposed at the rate of 5% of the gross receipts for the purchase price for the billing period.

(e) Beginning with bills issued on and after January 1, 2020, a delivering supplier maintaining a place of business in this State shall collect from the purchasers within a municipality imposing a tax pursuant to this Section who have elected the alternate tax rate provided in subsection (d) the tax that is imposed by the municipality at the alternate tax rate. The tax imposed at the alternate tax rate shall, when collected, be stated as a distinct and separate item apart from the selling price of the gas. The tax collected by a delivering supplier shall constitute a debt owed by that person to the municipality imposing the tax. Upon receipt by a delivering supplier of a copy of a certificate of registration issued to a self-assessing purchaser under subsection (f), the delivering supplier is relieved of the duty to collect the alternate tax from that self-assessing purchaser beginning with bills issued to that self-assessing purchaser 30 or more days after receipt of the copy of that certificate of registration.

(f) Any purchaser who does not elect the alternate tax rate to be paid to a delivering supplier shall register with the municipality imposing the tax as a self-assessing purchaser and pay the tax imposed directly to the municipality imposing the tax at the self-assessing purchaser rate.

Application for a certificate of registration as a self-assessing purchaser shall be made to the municipality imposing the tax on forms furnished by the municipality and shall contain any reasonable information that the municipality requires. The self-assessing purchaser shall disclose the name of the delivering supplier or suppliers who are delivering the gas upon which the self-assessing purchaser will be paying tax to the municipality imposing the tax.

Upon receipt of an application for a certificate of registration in proper form, the municipality imposing the tax shall issue to the applicant a certificate of registration as a self-assessing purchaser. The applicant shall provide a copy of the certificate of registration as a self-assessing purchaser to the applicant's delivering supplier or suppliers. A purchaser registering as a self-assessing purchaser may not revoke the registration for at least one year after registration.

(g) Except for purchasers who have chosen the alternate tax rate to be paid to a delivering supplier maintaining a place of business in this State, the tax imposed by the municipality pursuant to subsection (d) shall be paid to the municipality imposing the tax directly by each self-assessing purchaser that is subject to the tax imposed by the municipality. Each self-assessing purchaser shall, on or before the 15th day of each month, make a return to the municipality imposing the tax for the preceding calendar month, stating the following:

(1) the self-assessing purchaser's name and principal address;

(2) the total number of therms used by the self-assessing purchaser during the preceding calendar month and upon the basis of which the tax is imposed;

(3) the purchase price of gas used by the self-assessing purchaser during the preceding calendar month and upon the basis of which the tax is imposed;

(4) amount of tax (computed upon items (2) and (3)); and

(5) any other reasonable information the municipality imposing the tax may require.

(h) A delivering supplier maintaining a place of business in this State who engages in the delivery of gas to customers within a municipality imposing the tax in this State shall register with the municipality imposing the tax. A delivering supplier, if required to otherwise register pursuant to a tax imposed under Section 8-11-2 of this Code, need not obtain an additional certificate of registration under this Section, but shall be deemed to be sufficiently registered by virtue of that registration with the municipality imposing the tax.

Application for a certificate of registration shall be made to the municipality imposing the tax on forms furnished by the municipality and shall contain any reasonable information the municipality may require. Upon receipt of a completed application for a certificate of registration, the municipality imposing the tax shall issue to the applicant a certificate of registration. The municipality imposing the tax may deny a certificate of registration to any applicant if the applicant is in default for moneys due under this Section. A person aggrieved by a decision of the municipality imposing the tax under this subsection may, within 20 days after notice of the decision, protest and request a hearing, whereupon the municipality imposing the tax shall give notice to the person of the time and place fixed for the hearing, shall hold a hearing in conformity with the provisions of this Section, and then issue its final administrative decision in the matter to the person. In the absence of a protest within 20 days, the municipality's decision shall become final without any further determination being made or notice given.

(i) A delivering supplier who is required under subsection (e) to collect the tax imposed by the municipality shall make a return to the municipality imposing the tax on or before the 15th day of each month for the preceding calendar month stating the following:

(1) the delivering supplier's name;

(2) the address of the delivering supplier's principal place of business and the address of the principal place of business (if that is a different address) from which the delivering supplier engages in the business of delivering gas to persons for use or consumption and not for resale;

(3) the total number of therms of gas delivered to purchasers within a municipality imposing a tax pursuant to this Section during the preceding calendar month and upon the basis of which the tax is imposed;

(4) the amount of tax computed upon item (3); and

(5) any other reasonable information as the municipality imposing the tax may require.

In making the return, the delivering supplier engaged in the business of delivering gas to persons for use or consumption and not for resale may use any reasonable method to derive reportable therms from the delivering supplier's billing and payment records.

Notwithstanding any other provision in this Section concerning the time within which a delivering supplier may file its return, in the case of a delivering supplier who ceases to engage in a kind of business that makes it responsible for filing returns with a municipality imposing a tax under this Section, the delivering supplier shall file a final return under this Section with the affected municipality not more than one month after discontinuing a kind of business that makes it responsible for filing returns with a municipality.

The delivering supplier making the return provided for in this Section shall, at the time of making the return, pay to the municipality the amount of tax imposed by the municipality.

Section 10. The Public Utilities Act is amended by changing Section 9-221 as follows:

(220 ILCS 5/9-221) (from Ch. 111 2/3, par. 9-221)

Sec. 9-221. Whenever a municipality pursuant to Section 8-11-2 or 8-11-2.7 of the Illinois Municipal Code, as heretofore and hereafter amended, imposes a tax on any public utility, such utility may charge its customers, other than customers who are certified business enterprises under paragraph (e) of Section 8-11-2 of the Illinois Municipal Code or are exempted from those taxes under paragraph (f) of that Section, to the extent of such exemption and during the period in which such exemption is in effect, in addition to any rate authorized by this Act, an additional charge equal to the sum of (1) an amount equal to such municipal tax, or any part thereof (2) 3% of such tax, or any part thereof, as the case may be, to cover costs of accounting, and (3) an amount equal to the increase in taxes and other payments to governmental bodies resulting from the amount of such additional charge. Such utility shall file with the Commission a true and correct copy of the municipal ordinance imposing such tax; and also shall file with the Commission a supplemental schedule applicable to such municipality which shall specify such additional charge and which shall become effective upon filing without further notice. Such additional charge shall be shown separately on the utility bill to each customer. The Commission shall have power to investigate whether or not such supplemental schedule correctly specifies such additional charge, but shall have no power to suspend such supplemental schedule. If the Commission finds, after a hearing, that such supplemental schedule does not correctly specify such additional charge, it shall by order require a refund to the appropriate customers of the excess, if any, with interest, in such manner as it shall deem just and reasonable, and in and by such order shall require the utility to file an amended supplemental schedule corresponding to the finding and order of the Commission.

(Source: P.A. 87-895; 88-132.)

Section 99. Effective date. This Act takes effect January 1, 2020.".