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Full Text of SB0157  102nd General Assembly

SB0157ham001 102ND GENERAL ASSEMBLY

Rep. Jehan Gordon-Booth

Filed: 5/18/2021

 

 


 

 


 
10200SB0157ham001LRB102 10128 HLH 26531 a

1
AMENDMENT TO SENATE BILL 157

2    AMENDMENT NO. ______. Amend Senate Bill 157 on page 1,
3line 5, by replacing "Section 221" with "Sections 220, 221,
4and 228"; and
 
5on page 1, immediately below line 5, by inserting the
6following:
 
7    "(35 ILCS 5/220)
8    Sec. 220. Angel investment credit.
9    (a) As used in this Section:
10    "Applicant" means a corporation, partnership, limited
11liability company, or a natural person that makes an
12investment in a qualified new business venture. The term
13"applicant" does not include (i) a corporation, partnership,
14limited liability company, or a natural person who has a
15direct or indirect ownership interest of at least 51% in the
16profits, capital, or value of the qualified new business

 

 

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1venture receiving the investment or (ii) a related member.
2    "Claimant" means an applicant certified by the Department
3who files a claim for a credit under this Section.
4    "Department" means the Department of Commerce and Economic
5Opportunity.
6    "Investment" means money (or its equivalent) given to a
7qualified new business venture, at a risk of loss, in
8consideration for an equity interest of the qualified new
9business venture. The Department may adopt rules to permit
10certain forms of contingent equity investments to be
11considered eligible for a tax credit under this Section.
12    "Qualified new business venture" means a business that is
13registered with the Department under this Section.
14    "Related member" means a person that, with respect to the
15applicant, is any one of the following:
16        (1) An individual, if the individual and the members
17    of the individual's family (as defined in Section 318 of
18    the Internal Revenue Code) own directly, indirectly,
19    beneficially, or constructively, in the aggregate, at
20    least 50% of the value of the outstanding profits,
21    capital, stock, or other ownership interest in the
22    qualified new business venture that is the recipient of
23    the applicant's investment.
24        (2) A partnership, estate, or trust and any partner or
25    beneficiary, if the partnership, estate, or trust and its
26    partners or beneficiaries own directly, indirectly,

 

 

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1    beneficially, or constructively, in the aggregate, at
2    least 50% of the profits, capital, stock, or other
3    ownership interest in the qualified new business venture
4    that is the recipient of the applicant's investment.
5        (3) A corporation, and any party related to the
6    corporation in a manner that would require an attribution
7    of stock from the corporation under the attribution rules
8    of Section 318 of the Internal Revenue Code, if the
9    applicant and any other related member own, in the
10    aggregate, directly, indirectly, beneficially, or
11    constructively, at least 50% of the value of the
12    outstanding stock of the qualified new business venture
13    that is the recipient of the applicant's investment.
14        (4) A corporation and any party related to that
15    corporation in a manner that would require an attribution
16    of stock from the corporation to the party or from the
17    party to the corporation under the attribution rules of
18    Section 318 of the Internal Revenue Code, if the
19    corporation and all such related parties own, in the
20    aggregate, at least 50% of the profits, capital, stock, or
21    other ownership interest in the qualified new business
22    venture that is the recipient of the applicant's
23    investment.
24        (5) A person to or from whom there is attribution of
25    ownership of stock in the qualified new business venture
26    that is the recipient of the applicant's investment in

 

 

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1    accordance with Section 1563(e) of the Internal Revenue
2    Code, except that for purposes of determining whether a
3    person is a related member under this paragraph, "20%"
4    shall be substituted for "5%" whenever "5%" appears in
5    Section 1563(e) of the Internal Revenue Code.
6    (b) For taxable years beginning after December 31, 2010,
7and ending on or before December 31, 2024 December 31, 2021,
8subject to the limitations provided in this Section, a
9claimant may claim, as a credit against the tax imposed under
10subsections (a) and (b) of Section 201 of this Act, an amount
11equal to 25% of the claimant's investment made directly in a
12qualified new business venture. In order for an investment in
13a qualified new business venture to be eligible for tax
14credits, the business must have applied for and received
15certification under subsection (e) for the taxable year in
16which the investment was made prior to the date on which the
17investment was made. The credit under this Section may not
18exceed the taxpayer's Illinois income tax liability for the
19taxable year. If the amount of the credit exceeds the tax
20liability for the year, the excess may be carried forward and
21applied to the tax liability of the 5 taxable years following
22the excess credit year. The credit shall be applied to the
23earliest year for which there is a tax liability. If there are
24credits from more than one tax year that are available to
25offset a liability, the earlier credit shall be applied first.
26In the case of a partnership or Subchapter S Corporation, the

 

 

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1credit is allowed to the partners or shareholders in
2accordance with the determination of income and distributive
3share of income under Sections 702 and 704 and Subchapter S of
4the Internal Revenue Code.
5    (c) The minimum amount an applicant must invest in any
6single qualified new business venture in order to be eligible
7for a credit under this Section is $10,000. The maximum amount
8of an applicant's total investment made in any single
9qualified new business venture that may be used as the basis
10for a credit under this Section is $2,000,000.
11    (d) The Department shall implement a program to certify an
12applicant for an angel investment credit. Upon satisfactory
13review, the Department shall issue a tax credit certificate
14stating the amount of the tax credit to which the applicant is
15entitled. The Department shall annually certify that: (i) each
16qualified new business venture that receives an angel
17investment under this Section has maintained a minimum
18employment threshold, as defined by rule, in the State (and
19continues to maintain a minimum employment threshold in the
20State for a period of no less than 3 years from the issue date
21of the last tax credit certificate issued by the Department
22with respect to such business pursuant to this Section); and
23(ii) the claimant's investment has been made and remains,
24except in the event of a qualifying liquidity event, in the
25qualified new business venture for no less than 3 years.
26    If an investment for which a claimant is allowed a credit

 

 

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1under subsection (b) is held by the claimant for less than 3
2years, other than as a result of a permitted sale of the
3investment to person who is not a related member, the claimant
4shall pay to the Department of Revenue, in the manner
5prescribed by the Department of Revenue, the aggregate amount
6of the disqualified credits that the claimant received related
7to the subject investment.
8    If the Department determines that a qualified new business
9venture failed to maintain a minimum employment threshold in
10the State through the date which is 3 years from the issue date
11of the last tax credit certificate issued by the Department
12with respect to the subject business pursuant to this Section,
13the claimant or claimants shall pay to the Department of
14Revenue, in the manner prescribed by the Department of
15Revenue, the aggregate amount of the disqualified credits that
16claimant or claimants received related to investments in that
17business.
18    (e) The Department shall implement a program to register
19qualified new business ventures for purposes of this Section.
20A business desiring registration under this Section shall be
21required to submit a full and complete application to the
22Department. A submitted application shall be effective only
23for the taxable year in which it is submitted, and a business
24desiring registration under this Section shall be required to
25submit a separate application in and for each taxable year for
26which the business desires registration. Further, if at any

 

 

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1time prior to the acceptance of an application for
2registration under this Section by the Department one or more
3events occurs which makes the information provided in that
4application materially false or incomplete (in whole or in
5part), the business shall promptly notify the Department of
6the same. Any failure of a business to promptly provide the
7foregoing information to the Department may, at the discretion
8of the Department, result in a revocation of a previously
9approved application for that business, or disqualification of
10the business from future registration under this Section, or
11both. The Department may register the business only if all of
12the following conditions are satisfied:
13        (1) it has its principal place of business in this
14    State;
15        (2) at least 51% of the employees employed by the
16    business are employed in this State;
17        (3) the business has the potential for increasing jobs
18    in this State, increasing capital investment in this
19    State, or both, as determined by the Department, and
20    either of the following apply:
21            (A) it is principally engaged in innovation in any
22        of the following: manufacturing; biotechnology;
23        nanotechnology; communications; agricultural
24        sciences; clean energy creation or storage technology;
25        processing or assembling products, including medical
26        devices, pharmaceuticals, computer software, computer

 

 

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1        hardware, semiconductors, other innovative technology
2        products, or other products that are produced using
3        manufacturing methods that are enabled by applying
4        proprietary technology; or providing services that are
5        enabled by applying proprietary technology; or
6            (B) it is undertaking pre-commercialization
7        activity related to proprietary technology that
8        includes conducting research, developing a new product
9        or business process, or developing a service that is
10        principally reliant on applying proprietary
11        technology;
12        (4) it is not principally engaged in real estate
13    development, insurance, banking, lending, lobbying,
14    political consulting, professional services provided by
15    attorneys, accountants, business consultants, physicians,
16    or health care consultants, wholesale or retail trade,
17    leisure, hospitality, transportation, or construction,
18    except construction of power production plants that derive
19    energy from a renewable energy resource, as defined in
20    Section 1 of the Illinois Power Agency Act;
21        (5) at the time it is first certified:
22            (A) it has fewer than 100 employees;
23            (B) it has been in operation in Illinois for not
24        more than 10 consecutive years prior to the year of
25        certification; and
26            (C) it has received not more than $10,000,000 in

 

 

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1        aggregate investments;
2        (5.1) it agrees to maintain a minimum employment
3    threshold in the State of Illinois prior to the date which
4    is 3 years from the issue date of the last tax credit
5    certificate issued by the Department with respect to that
6    business pursuant to this Section;
7        (6) (blank); and
8        (7) it has received not more than $4,000,000 in
9    investments that qualified for tax credits under this
10    Section.
11    (f) The Department, in consultation with the Department of
12Revenue, shall adopt rules to administer this Section. The
13aggregate amount of the tax credits that may be claimed under
14this Section for investments made in qualified new business
15ventures shall be limited at $10,000,000 per calendar year, of
16which $500,000 shall be reserved for investments made in
17qualified new business ventures which are minority-owned
18businesses, women-owned businesses, or businesses owned by a
19person with a disability (as those terms are used and defined
20in the Business Enterprise for Minorities, Women, and Persons
21with Disabilities Act), and an additional $500,000 shall be
22reserved for investments made in qualified new business
23ventures with their principal place of business in counties
24with a population of not more than 250,000. The foregoing
25annual allowable amounts shall be allocated by the Department,
26on a per calendar quarter basis and prior to the commencement

 

 

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1of each calendar year, in such proportion as determined by the
2Department, provided that: (i) the amount initially allocated
3by the Department for any one calendar quarter shall not
4exceed 35% of the total allowable amount; (ii) any portion of
5the allocated allowable amount remaining unused as of the end
6of any of the first 3 calendar quarters of a given calendar
7year shall be rolled into, and added to, the total allocated
8amount for the next available calendar quarter; and (iii) the
9reservation of tax credits for investments in minority-owned
10businesses, women-owned businesses, businesses owned by a
11person with a disability, and in businesses in counties with a
12population of not more than 250,000 is limited to the first 3
13calendar quarters of a given calendar year, after which they
14may be claimed by investors in any qualified new business
15venture.
16    (g) A claimant may not sell or otherwise transfer a credit
17awarded under this Section to another person.
18    (h) On or before March 1 of each year, the Department shall
19report to the Governor and to the General Assembly on the tax
20credit certificates awarded under this Section for the prior
21calendar year.
22        (1) This report must include, for each tax credit
23    certificate awarded:
24            (A) the name of the claimant and the amount of
25        credit awarded or allocated to that claimant;
26            (B) the name and address (including the county) of

 

 

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1        the qualified new business venture that received the
2        investment giving rise to the credit, the North
3        American Industry Classification System (NAICS) code
4        applicable to that qualified new business venture, and
5        the number of employees of the qualified new business
6        venture; and
7            (C) the date of approval by the Department of each
8        claimant's tax credit certificate.
9        (2) The report must also include:
10            (A) the total number of applicants and the total
11        number of claimants, including the amount of each tax
12        credit certificate awarded to a claimant under this
13        Section in the prior calendar year;
14            (B) the total number of applications from
15        businesses seeking registration under this Section,
16        the total number of new qualified business ventures
17        registered by the Department, and the aggregate amount
18        of investment upon which tax credit certificates were
19        issued in the prior calendar year; and
20            (C) the total amount of tax credit certificates
21        sought by applicants, the amount of each tax credit
22        certificate issued to a claimant, the aggregate amount
23        of all tax credit certificates issued in the prior
24        calendar year and the aggregate amount of tax credit
25        certificates issued as authorized under this Section
26        for all calendar years.

 

 

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1    (i) For each business seeking registration under this
2Section after December 31, 2016, the Department shall require
3the business to include in its application the North American
4Industry Classification System (NAICS) code applicable to the
5business and the number of employees of the business at the
6time of application. Each business registered by the
7Department as a qualified new business venture that receives
8an investment giving rise to the issuance of a tax credit
9certificate pursuant to this Section shall, for each of the 3
10years following the issue date of the last tax credit
11certificate issued by the Department with respect to such
12business pursuant to this Section, report to the Department
13the following:
14        (1) the number of employees and the location at which
15    those employees are employed, both as of the end of each
16    year;
17        (2) the amount of additional new capital investment
18    raised as of the end of each year, if any; and
19        (3) the terms of any liquidity event occurring during
20    such year; for the purposes of this Section, a "liquidity
21    event" means any event that would be considered an exit
22    for an illiquid investment, including any event that
23    allows the equity holders of the business (or any material
24    portion thereof) to cash out some or all of their
25    respective equity interests.
26(Source: P.A. 100-328, eff. 1-1-18; 100-686, eff. 1-1-19;

 

 

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1100-863, eff. 8-14-18; 101-81, eff. 7-12-19.)"; and
 
2on page 1, line 21, by replacing "January 1, 2027" with
3"January 1, 2025"; and
 
4on page 8, immediately below line 11, by inserting the
5following:
 
6    "(35 ILCS 5/228)
7    Sec. 228. Historic preservation credit. For tax years
8beginning on or after January 1, 2019 and ending on or before
9December 31, 2023, a taxpayer who qualifies for a credit under
10the Historic Preservation Tax Credit Act is entitled to a
11credit against the taxes imposed under subsections (a) and (b)
12of Section 201 of this Act as provided in that Act. If the
13taxpayer is a partnership, or Subchapter S corporation, or a
14limited liability company the credit shall be allowed to the
15partners, or shareholders, or members in accordance with the
16determination of income and distributive share of income under
17Sections 702 and 704 and Subchapter S of the Internal Revenue
18Code provided that credits granted to a partnership, a limited
19liability company taxed as a partnership, or other multiple
20owners of property shall be passed through to the partners,
21members, or owners respectively on a pro rata basis or
22pursuant to an executed agreement among the partners, members,
23or owners documenting any alternate distribution method. If

 

 

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1the amount of any tax credit awarded under this Section
2exceeds the qualified taxpayer's income tax liability for the
3year in which the qualified rehabilitation plan was placed in
4service, the excess amount may be carried forward as provided
5in the Historic Preservation Tax Credit Act.
6(Source: P.A. 100-629, eff. 1-1-19; 101-81, eff. 7-12-19.)
 
7    Section 10. The Historic Preservation Tax Credit Act is
8amended by changing Sections 5, 10, 20, and 25 as follows:
 
9    (35 ILCS 31/5)
10    Sec. 5. Definitions. As used in this Act, unless the
11context clearly indicates otherwise:
12    "Director" means the Director of Natural Resources or his
13or her designee.
14    "Division" means the State Historic Preservation Office
15within the Department of Natural Resources.
16    "Phased rehabilitation" means a project that is completed
17in phases, as defined under Section 47 of the federal Internal
18Revenue Code and pursuant to National Park Service regulations
19at 36 C.F.R. 67.
20    "Placed in service" means the date when the property is
21placed in a condition or state of readiness and availability
22for a specifically assigned function as defined under Section
2347 of the federal Internal Revenue Code and federal Treasury
24Regulation Sections 1.46 and 1.48.

 

 

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1    "Qualified expenditures" means all the costs and expenses
2defined as qualified rehabilitation expenditures under Section
347 of the federal Internal Revenue Code that were incurred in
4connection with a qualified rehabilitation plan historic
5structure.
6    "Qualified historic structure" means any structure that is
7located in Illinois and is defined as a certified historic
8structure under Section 47(c)(3) of the federal Internal
9Revenue Code.
10    "Qualified rehabilitation plan" means a project that is
11approved by the Department of Natural Resources and the
12National Park Service as being consistent with the United
13States Secretary of the Interior's Standards for
14Rehabilitation.
15    "Qualified taxpayer" means the owner of the qualified
16historic structure or any other person or entity who may
17qualify for the federal rehabilitation credit allowed by
18Section 47 of the federal Internal Revenue Code.
19    "Recapture event" means any of the following events
20occurring during the recapture period:
21        (1) failure to place in service the rehabilitated
22    portions of the qualified historic structure, or failure
23    to maintain the rehabilitated portions of the qualified
24    historic structure in service after they are placed in
25    service; provided that a recapture event under this
26    paragraph (1) shall not include a removal from service for

 

 

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1    a reasonable period of time to conduct maintenance and
2    repairs that are reasonably necessary to protect the
3    health and safety of the public or to protect the
4    structural integrity of the qualified historic structure
5    or a neighboring structure;
6        (2) demolition or other alteration of the qualified
7    historic structure in a manner that is inconsistent with
8    the qualified rehabilitation plan or the Secretary of the
9    Interior's Standards for Rehabilitation;
10        (3) disposition of the rehabilitated qualified
11    historic structure in whole or a proportional disposition
12    of a partnership interest therein, except as otherwise
13    permitted by this Section; or
14        (4) use of the qualified historic structure in a
15    manner that is inconsistent with the qualified
16    rehabilitation plan or that is otherwise inconsistent with
17    the provisions and intent of this Section.
18    A recapture event occurring in one taxable year shall be
19deemed continuing to subsequent taxable years unless and until
20corrected.
21    The following dispositions of a qualified historic
22structure shall not be deemed to be a recapture event for
23purposes of this Section:
24        (1) a transfer by reason of death;
25        (2) a transfer between spouses incident to divorce;
26        (3) a sale by and leaseback to an entity that, when the

 

 

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1    rehabilitated portions of the qualified historic structure
2    are placed in service, will be a lessee of the qualified
3    historic structure, but only for so long as the entity
4    continues to be a lessee; and
5        (4) a mere change in the form of conducting the trade
6    or business by the owner (or, if applicable, the lessee)
7    of the qualified historic structure, so long as the
8    property interest in such qualified historic structure is
9    retained in such trade or business and the owner or lessee
10    retains a substantial interest in such trade or business.
11    "Recapture period" means the 5-year period beginning on
12the date that the qualified historic structure or
13rehabilitated portions of the qualified historic structure are
14placed in service.
15    "Substantial rehabilitation" means that the qualified
16rehabilitation expenditures during the 24-month period
17selected by the taxpayer at the time and in the manner
18prescribed by rule and ending with or within the taxable year
19exceed the greater of (i) the adjusted basis of the building
20and its structural components or (ii) $5,000. The adjusted
21basis of the building and its structural components shall be
22determined as of the beginning of the first day of such
2324-month period or as of the beginning of the first day of the
24holding period of the building, whichever is later. For
25purposes of determining the adjusted basis, the determination
26of the beginning of the holding period shall be made without

 

 

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1regard to any reconstruction by the taxpayer in connection
2with the rehabilitation. In the case of any phased
3rehabilitation, with phases set forth in architectural plans
4and specifications completed before the rehabilitation begins,
5this definition shall be applied by substituting "60-month
6period" for "24-month period" wherever that term occurs in the
7definition.
8(Source: P.A. 100-629, eff. 1-1-19.)
 
9    (35 ILCS 31/10)
10    Sec. 10. Allowable credit.
11    (a) To the extent authorized by this Act, for taxable
12years beginning on or after January 1, 2019 and ending on or
13before December 31, 2023, there shall be allowed a tax credit
14to the qualified taxpayer against the tax imposed by
15subsections (a) and (b) of Section 201 of the Illinois Income
16Tax Act in an aggregate amount equal to 25% of qualified
17expenditures, but not to exceed $3,000,000, incurred by a
18qualified taxpayer undertaking a qualified rehabilitation plan
19of a qualified historic structure, provided that the total
20amount of such expenditures must (i) equal $5,000 or more and
21or (ii) exceed the adjusted basis of the qualified historic
22structure on the first day the qualified rehabilitation plan
23commenced. If the qualified rehabilitation plan spans multiple
24years, the aggregate credit for the entire project shall be
25allowed in the last taxable year.

 

 

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1    (b) To obtain a tax credit certificate pursuant to this
2Section, the qualified taxpayer must apply with the Division.
3The Division shall determine the amount of eligible
4rehabilitation expenditures within 45 days after receipt of a
5complete application. The taxpayer must provide to the
6Division a third-party cost certification conducted by a
7certified public accountant verifying (i) the qualified and
8non-qualified rehabilitation expenses and (ii) that the
9qualified expenditures exceed the adjusted basis of the
10qualified historic structure on the first day the qualified
11rehabilitation plan commenced. The accountant shall provide
12appropriate review and testing of invoices. The Division is
13authorized, but not required, to accept this third-party cost
14certification to determine the amount of qualified
15expenditures. The Division and the National Park Service shall
16determine whether the rehabilitation is consistent with the
17Standards of the Secretary of the United States Department of
18the Interior.
19    (c) If the amount of any tax credit awarded under this Act
20exceeds the qualified taxpayer's income tax liability for the
21year in which the qualified rehabilitation plan was placed in
22service, the excess amount may be carried forward for
23deduction from the taxpayer's income tax liability in the next
24succeeding year or years until the total amount of the credit
25has been used, except that a credit may not be carried forward
26for deduction after the tenth taxable year after the taxable

 

 

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1year in which the qualified rehabilitation plan was placed in
2service. Upon completion of the project and approval of the
3complete application review of the project, the Division shall
4issue a single certificate in the amount of the eligible
5credits equal to 25% of the qualified expenditures incurred
6during the eligible taxable years, not to exceed the lesser of
7the allocated amount or $3,000,000 per single qualified
8rehabilitation plan. Prior to the issuance of the tax credit
9certificate, the qualified taxpayer must provide to the
10Division verification that the rehabilitated structure is a
11qualified historic structure. At the time the certificate is
12issued, an issuance fee up to the maximum amount of 2% of the
13amount of the credits issued by the certificate may be
14collected from the qualified taxpayer applicant to administer
15the Act. If collected, this issuance fee shall be directed to
16the Division Historic Property Administrative Fund or other
17such fund as appropriate for use of the Division in the
18administration of the Historic Preservation Tax Credit
19Program. The taxpayer must attach the certificate or legal
20documentation of her or his proportional share of the
21certificate to the tax return on which the credits are to be
22claimed. The tax credit under this Section may not reduce the
23taxpayer's liability to less than zero. If the amount of the
24credit exceeds the tax liability for the year, the excess
25credit may be carried forward and applied to the tax liability
26of the 10 taxable years following the first excess credit

 

 

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1year. The taxpayer is not eligible to receive credits under
2this Section and under Section 221 of the Illinois Income Tax
3Act for the same qualified expenditures or qualified
4rehabilitation plan.
5    (d) If the taxpayer is (i) a corporation having an
6election in effect under Subchapter S of the federal Internal
7Revenue Code, (ii) a partnership, or (iii) a limited liability
8company, the credit provided under this Act may be claimed by
9the shareholders of the corporation, the partners of the
10partnership, or the members of the limited liability company
11in the same manner as those shareholders, partners, or members
12account for their proportionate shares of the income or losses
13of the corporation, partnership, or limited liability company,
14or as provided in the bylaws or other executed agreement of the
15corporation, partnership, or limited liability company.
16Credits granted to a partnership, a limited liability company
17taxed as a partnership, or other multiple owners of property
18shall be passed through to the partners, members, or owners
19respectively on a pro rata basis or pursuant to an executed
20agreement among the partners, members, or owners documenting
21any alternate distribution method.
22    (e) If a recapture event occurs during the recapture
23period with respect to a qualified historic structure, then
24for any taxable year in which the credits are allowed as
25specified in this Act, the tax under the applicable Section of
26this Act shall be increased by applying the recapture

 

 

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1percentage set forth below to the tax decrease resulting from
2the application of credits allowed under this Act to the
3taxable year in question.
4    For the purposes of this subsection, the recapture
5percentage shall be determined as follows:
6        (1) if the recapture event occurs within the first
7    year after commencement of the recapture period, then the
8    recapture percentage is 100%;
9        (2) if the recapture event occurs within the second
10    year after commencement of the recapture period, then the
11    recapture percentage is 80%;
12        (3) if the recapture event occurs within the third
13    year after commencement of the recapture period, then the
14    recapture percentage is 60%;
15        (4) if the recapture event occurs within the fourth
16    year after commencement of the recapture period, then the
17    recapture percentage is 40%; and
18        (5) if the recapture event occurs within the fifth
19    year after commencement of the recapture period, then the
20    recapture percentage is 20%.
21    In the case of any recapture event, the carryforwards
22under this Act shall be adjusted by reason of such event.
23    (f) The Division may adopt rules to implement this Section
24in addition to the rules expressly authorized herein.
25(Source: P.A. 100-629, eff. 1-1-19; 101-81, eff. 7-12-19.)
 

 

 

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1    (35 ILCS 31/20)
2    Sec. 20. Limitations, reporting, and monitoring.
3    (a) In every calendar year that this program is in effect,
4the Division is authorized to allocate $15,000,000 in tax
5credits in addition to any unallocated, returned, or rescinded
6allocations from previous years, pursuant to qualified
7rehabilitation plans. The Division shall award not more than
8an aggregate of $15,000,000 in total annual tax credits
9pursuant to qualified rehabilitation plans for qualified
10historic structures. The Division shall not allocate or award
11award not more than $3,000,000 in tax credits with regard to a
12single qualified rehabilitation plan. In allocating awarding
13tax credits under this Act, the Division must prioritize
14applications projects that meet one or more of the following:
15        (1) the qualified historic structure is located in a
16    county that borders a State with a historic
17    income-producing property rehabilitation credit;
18        (2) the qualified historic structure was previously
19    owned by a federal, state, or local governmental entity
20    for no less than 6 months;
21        (3) the qualified historic structure is located in a
22    census tract that has a median family income at or below
23    the State median family income; data from the most recent
24    5-year estimate from the American Community Survey (ACS),
25    published by the U.S. Census Bureau, shall be used to
26    determine eligibility;

 

 

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1        (4) the qualified rehabilitation plan includes in the
2    development partnership a Community Development Entity or
3    a low-profit (B Corporation) or not-for-profit
4    organization, as defined by Section 501(c)(3) of the
5    Internal Revenue Code; or
6        (5) the qualified historic structure is located in an
7    area declared under an Emergency Declaration or Major
8    Disaster Declaration under the federal Robert T. Stafford
9    Disaster Relief and Emergency Assistance Act. The
10    declaration must be no older than 3 years at the time of
11    application.
12    (b) The annual aggregate authorization program allocation
13of $15,000,000 set forth in subsection (a) shall be allocated
14by the Division, in such proportion as determined by the
15Director Department, on a per calendar basis twice in each
16calendar year that the program is in effect, provided that:
17(i) the amount initially allocated by the Division for the
18first any one calendar year application period shall not
19exceed 65% of the total allowable amount available for
20allocation. Any unallocated and (ii) any portion of the
21allocated allowable amount remaining unused as of the end of
22any of the second calendar application period of a given
23calendar year shall be rolled over into and added to the total
24authorized allocated amount for the next available calendar
25year. The qualified rehabilitation plan must meet a readiness
26test, as defined in the rules created by the Division, in order

 

 

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1for the application Applicant to qualify. In any given
2application period, applications Applicants that qualify under
3this Act will be prioritized as set forth in subsection (a) and
4placed in a queue based on the date and time the application is
5received. Applicants whose applications qualify but do not
6receive an allocation until such time as the application
7period total allowable amount is reached. Applicants must
8reapply to be considered in subsequent for each application
9periods period.
10    (c) Subject On or before December 31, 2019, and on or
11before December 31 of each odd-numbered year thereafter
12through 2023, subject to appropriation and prior to equal
13disbursement to the Division, moneys in the Historic Property
14Administrative Fund shall be used, on a biennial basis,
15beginning at the end of the second first fiscal year after the
16effective date of this Act, to hire a qualified third party to
17prepare a biennial report to assess the overall impact
18effectiveness of this Act from the qualified rehabilitation
19plans projects under this Act completed in that year and in
20previous years. Baseline data of the metrics in the report
21shall be collected at the initiation of a qualified
22rehabilitation plan project. The overall economic impact shall
23include at least:
24        (1) the number of applications, project locations, and
25    proposed use of qualified historic structures;
26        (2) the amount of credits awarded and the number and

 

 

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1    location of projects receiving credit allocations;
2        (3) the status of ongoing projects and projected
3    qualifying expenditures for ongoing projects;
4        (4) for completed projects, the total amount of
5    qualifying rehabilitation expenditures and non-qualifying
6    expenditures, the number of housing units created and the
7    number of housing units that qualify as affordable, and
8    the total square footage rehabilitated and developed;
9        (5) direct, indirect, and induced economic impacts;
10        (6) temporary, permanent, and construction jobs
11    created; and
12        (7) sales, income, and property tax generation before
13    construction, during construction, and after completion.
14    The report to the General Assembly shall be filed with the
15Clerk of the House of Representatives and the Secretary of the
16Senate in electronic form only, in the manner that the Clerk
17and the Secretary shall direct.
18    (d) Any time prior to issuance of a tax credit
19certificate, the Director of the Division, the State Historic
20Preservation Officer, or staff of the Division may, upon
21reasonable notice to the project owner of not less than 3
22business days, conduct a site visit to the project to inspect
23and evaluate the project.
24    (e) Any time prior to the issuance of a tax credit
25certificate and for a period of 4 years following the
26effective date of a project tax credit certificate, the

 

 

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1Director may, upon reasonable notice of not less than 30
2calendar days, request a status report from the Applicant
3consisting of information and updates relevant to the status
4of the project. Status reports shall not be requested more
5than twice yearly.
6    (f) In order to demonstrate sufficient evidence of
7reviewable progress within 12 months after the date the
8Applicant received notification of allocation approval from
9the Division, the Director may require the Applicant to shall
10provide all of the following:
11        (1) a viable financial plan which demonstrates by way
12    of an executed agreement that all financing has been
13    secured for the project; such financing shall include, but
14    not be limited to, equity investment as demonstrated by
15    letters of commitment from the owner of the property,
16    investment partners, and equity investors;
17        (2) (blank); final construction drawings or approved
18    building permits that demonstrate the complete
19    rehabilitation of the full scope of the application; and
20        (3) all historic approvals, including all federal and
21    State rehabilitation documents required by the Division.
22    The Director shall review the submitted evidence and may
23request additional documentation from the Applicant if
24necessary. The Applicant will have 30 calendar days to provide
25the information requested, otherwise the allocation approval
26may be rescinded at the discretion of the Director.

 

 

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1    (g) In order to demonstrate sufficient evidence of
2reviewable progress within 24 18 months after the date the
3application received notification of approval from the
4Division, the Director may require the Applicant is required
5to provide detailed evidence that the Applicant has secured
6and closed on financing for the complete scope of
7rehabilitation for the project. To demonstrate evidence that
8the Applicant has secured and closed on financing, the
9Applicant will need to provide signed and processed loan
10agreements, bank financing documents or other legal and
11contractual evidence to demonstrate that adequate financing is
12available to complete the project. The Director shall review
13the submitted evidence and may request additional
14documentation from the Applicant if necessary. The Applicant
15will have 30 calendar days to provide the information
16requested, otherwise the allocation approval may be rescinded
17at the discretion of the Director.
18    If the Applicant fails to document reviewable progress
19within 24 18 months of approval, the Director may notify the
20Applicant that the allocation application is rescinded.
21However, should financing and construction be imminent, the
22Director may elect to grant the Applicant no more than 5 months
23to close on financing and commence construction. If the
24Applicant fails to meet these conditions in the required
25timeframe, the Director shall notify the Applicant that the
26allocation application is rescinded. Any such rescinded

 

 

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1allocation shall be added to the aggregate amount of credits
2available for allocation for the year in which the forfeiture
3occurred.
4    The amount of the qualified expenditures identified in the
5qualified taxpayer's Applicant's certification of completion
6and reflected on the Historic Preservation Tax Credit
7certificate issued by the Director is subject to inspection,
8examination, and audit by the Department of Revenue.
9    The qualified taxpayer Applicant shall establish and
10maintain for a period of 4 years following the effective date
11on a project tax credit certificate such records as required
12by the Director. Such records include, but are not limited to,
13records documenting project expenditures and compliance with
14the U.S. Secretary of the Interior's Standards. The qualified
15taxpayer Applicant shall make such records available for
16review and verification by the Director, the State Historic
17Preservation Officer, the Department of Revenue, or
18appropriate staff, as well as other appropriate State
19agencies. In the event the Director determines an Applicant
20has submitted a status an annual report containing erroneous
21information or data not supported by records established and
22maintained under this Act, the Director may, after providing
23notice, require the Applicant to resubmit corrected reports.
24(Source: P.A. 100-629, eff. 1-1-19.)
 
25    (35 ILCS 31/25)

 

 

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1    Sec. 25. Powers. The Division may shall adopt rules for
2the administration of this Act. The Division may enter into an
3intergovernmental agreement with the Department of Commerce
4and Economic Opportunity, the Department of Revenue, or both,
5for the administration of this Act. Such intergovernmental
6agreement may allow for the distribution of all or a portion of
7the issuance fee imposed under Section 10 to the Department of
8Commerce and Economic Opportunity or the Department of
9Revenue, as applicable.
10(Source: P.A. 100-629, eff. 1-1-19.)".