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91_SB0372
LRB9101402JSpc
1 AN ACT to amend the Public Utilities Act by changing
2 Section 8-403.1.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Public Utilities Act is amended by
6 changing Section 8-403.1 as follows:
7 (220 ILCS 5/8-403.1) (from Ch. 111 2/3, par. 8-403.1)
8 Sec. 8-403.1. Electricity purchased from qualified solid
9 waste energy facility; tax credit; distributions for economic
10 development.
11 (a) It is hereby declared to be the policy of this State
12 to encourage the development of alternate energy production
13 facilities in order to conserve our energy resources and to
14 provide for their most efficient use.
15 (b) For the purpose of this Section and Section 9-215.1,
16 "qualified solid waste energy facility" means a facility
17 determined by the Illinois Commerce Commission to qualify as
18 such under the Local Solid Waste Disposal Act, to use methane
19 gas generated from landfills as its primary fuel, and to
20 possess characteristics that would enable it to qualify as a
21 cogeneration or small power production facility under federal
22 law. The Commission may not make a determination under this
23 Section after July 1, 1999.
24 (c) In furtherance of the policy declared in this
25 Section, the Illinois Commerce Commission shall require
26 electric utilities to enter into long-term contracts to
27 purchase electricity from qualified solid waste energy
28 facilities located in the electric utility's service area,
29 for a period beginning on the date that the facility begins
30 generating electricity and having a duration of not less than
31 10 years in the case of facilities fueled by
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1 landfill-generated methane, or 20 years in the case of
2 facilities fueled by methane generated from a landfill owned
3 by a forest preserve district. The purchase rate contained
4 in such contracts shall be equal to the average amount per
5 kilowatt-hour paid from time to time by the unit or units of
6 local government in which the electricity generating
7 facilities are located, excluding amounts paid for street
8 lighting and pumping service.
9 (d) Whenever a public utility is required to purchase
10 electricity pursuant to subsection (c) above, it shall be
11 entitled to credits in respect of its obligations to remit to
12 the State taxes it has collected under the Electricity Excise
13 Tax Law equal to the amounts, if any, by which payments for
14 such electricity exceed (i) the then current rate at which
15 the utility must purchase the output of qualified facilities
16 pursuant to the federal Public Utility Regulatory Policies
17 Act of 1978, less (ii) any costs, expenses, losses, damages
18 or other amounts incurred by the utility, or for which it
19 becomes liable, arising out of its failure to obtain such
20 electricity from such other sources. The amount of any such
21 credit shall, in the first instance, be determined by the
22 utility, which shall make a monthly report of such credits to
23 the Illinois Commerce Commission and, on its monthly tax
24 return, to the Illinois Department of Revenue. Under no
25 circumstances shall a utility be required to purchase
26 electricity from a qualified solid waste energy facility at
27 the rate prescribed in subsection (c) of this Section if such
28 purchase would result in estimated tax credits that exceed,
29 on a monthly basis, the utility's estimated obligation to
30 remit to the State taxes it has collected under the
31 Electricity Excise Tax Law. The owner or operator shall
32 negotiate facility operating conditions with the purchasing
33 utility in accordance with that utility's posted standard
34 terms and conditions for small power producers. If the
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1 Department of Revenue disputes the amount of any such credit,
2 such dispute shall be decided by the Illinois Commerce
3 Commission. Whenever a qualified solid waste energy facility
4 has paid or otherwise satisfied in full the capital costs or
5 indebtedness incurred in developing and implementing the
6 qualified facility, the qualified facility shall reimburse
7 the Public Utility Fund and the General Revenue Fund in the
8 State treasury for the actual reduction in payments to those
9 Funds caused by this subsection (d) in a manner to be
10 determined by the Illinois Commerce Commission and based on
11 the manner in which revenues for those Funds were reduced.
12 (e) The Illinois Commerce Commission shall not require
13 an electric utility to purchase electricity from any
14 qualified solid waste energy facility which is owned or
15 operated by an entity that is primarily engaged in the
16 business of producing or selling electricity, gas, or useful
17 thermal energy from a source other than one or more qualified
18 solid waste energy facilities.
19 (f) This Section does not require an electric utility to
20 construct additional facilities unless those facilities are
21 paid for by the owner or operator of the affected qualified
22 solid waste energy facility.
23 (g) The Illinois Commerce Commission shall require that:
24 (1) electric utilities use the electricity purchased from a
25 qualified solid waste energy facility to displace electricity
26 generated from nuclear power or coal mined and purchased
27 outside the boundaries of the State of Illinois before
28 displacing electricity generated from coal mined and
29 purchased within the State of Illinois, to the extent
30 possible, and (2) electric utilities report annually to the
31 Commission on the extent of such displacements.
32 (h) Nothing in this Section is intended to cause an
33 electric utility that is required to purchase power hereunder
34 to incur any economic loss as a result of its purchase. All
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1 amounts paid for power which a utility is required to
2 purchase pursuant to subparagraph (c) shall be deemed to be
3 costs prudently incurred for purposes of computing charges
4 under rates authorized by Section 9-220 of this Act. Tax
5 credits provided for herein shall be reflected in charges
6 made pursuant to rates so authorized to the extent such
7 credits are based upon a cost which is also reflected in such
8 charges.
9 (i) Beginning in February 1999 and through January 2009,
10 each qualified solid waste energy facility that sells
11 electricity to an electric utility at the purchase rate
12 described in subsection (c) shall file with the State
13 Treasurer on or before the 15th of each month a form,
14 prescribed by the State Treasurer, that states the number of
15 kilowatt hours of electricity for which payment was received
16 at that purchase rate from electric utilities in Illinois
17 during the immediately preceding month. This form shall be
18 accompanied by a payment from the qualified solid waste
19 energy facility in an amount equal to six-tenths of a mill
20 ($0.0006) per kilowatt hour of electricity stated on the
21 form. Payments received by the State Treasurer shall be
22 deposited into the Municipal Economic Development Fund, a
23 trust fund created outside the State treasury. The State
24 Treasurer may invest the moneys in the Fund in any investment
25 authorized by the Public Funds Investment Act, and investment
26 income shall be deposited into and become part of the Fund.
27 Moneys in the Fund shall be used by the State Treasurer as
28 provided in subsection (j). The obligation of a qualified
29 solid waste energy facility to make payments into the
30 Municipal Economic Development Fund shall terminate upon
31 either: (1) expiration or termination of a facility's
32 contract to sell electricity to an electric utility at the
33 purchase rate described in subsection (c); or (2) entry of an
34 enforceable, final, and non-appealable order by a court of
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1 competent jurisdiction that Public Act 89-448 is invalid.
2 Payments by a qualified solid waste energy facility into the
3 Municipal Economic Development Fund do not relieve the
4 qualified solid waste energy facility of its obligation to
5 reimburse the Public Utility Fund and the General Revenue
6 Fund for the actual reduction in payments to those Funds as a
7 result of credits received by electric utilities under
8 subsection (d).
9 (j) The State Treasurer, without appropriation, must
10 make distributions immediately after January 15, April 15,
11 July 15, and October 15 of each year, up to maximum aggregate
12 distributions of $500,000 for the distributions made in the 4
13 quarters beginning with the April distribution and ending
14 with the January distribution, from the Municipal Economic
15 Development Fund to each city, village, or incorporated town
16 that has within its boundaries an incinerator that: (1) uses
17 municipal waste as its primary fuel to generate electricity;
18 (2) was determined by the Illinois Commerce Commission to
19 qualify as a qualified solid waste energy facility prior to
20 the effective date of Public Act 89-448; and (3) commenced
21 operation prior to January 1, 1998. Total distributions in
22 the aggregate to all qualified cities, villages, and
23 incorporated towns in the 4 quarters beginning with the April
24 distribution and ending with the January distribution shall
25 not exceed $500,000. The amount of each distribution shall
26 be determined pro rata based on the population of the city,
27 village, or incorporated town compared to the total
28 population of all cities, villages, and incorporated towns
29 eligible to receive a distribution. Distributions received
30 by a city, village, or incorporated town must be held in a
31 separate account and may be used only to promote and enhance
32 industrial, commercial, residential, service, transportation,
33 and recreational activities and facilities within its
34 boundaries, thereby enhancing the employment opportunities,
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1 public health and general welfare, and economic development
2 within the community, including administrative expenditures
3 exclusively to further these activities. These funds,
4 however, shall not be used by the city, village, or
5 incorporated town, directly or indirectly, to purchase,
6 lease, operate, or in any way subsidize the operation of any
7 incinerator, and these funds shall not be paid, directly or
8 indirectly, by the city, village, or incorporated town to the
9 owner, operator, lessee, shareholder, or bondholder of any
10 incinerator. Moreover, these funds shall not be used to pay
11 attorneys fees in any litigation relating to the validity of
12 Public Act 89-448. Nothing in this Section prevents a city,
13 village, or incorporated town from using other corporate
14 funds for any legitimate purpose. For purposes of this
15 subsection, the term "municipal waste" has the meaning
16 ascribed to it in Section 3.21 of the Environmental
17 Protection Act.
18 (k) If maximum aggregate distributions of $500,000 under
19 subsection (j) have been made after the January distribution
20 from the Municipal Economic Development Fund, then the
21 balance in the Fund shall be refunded to the qualified solid
22 waste energy facilities that made payments that were
23 deposited into the Fund during the previous 12-month period.
24 The refunds shall be prorated based upon the facility's
25 payments in relation to total payments for that 12-month
26 period.
27 (l) Beginning January 1, 2000, and each January 1
28 thereafter, each city, village, or incorporated town that
29 received distributions from the Municipal Economic
30 Development Fund, continued to hold any of those
31 distributions, or made expenditures from those distributions
32 during the immediately preceding year shall submit to a
33 financial and compliance and program audit of those
34 distributions performed by the Auditor General at no cost to
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1 the city, village, or incorporated town that received the
2 distributions. The audit should be completed by June 30 or
3 as soon thereafter as possible. The audit shall be submitted
4 to the State Treasurer and those officers enumerated in
5 Section 3-14 of the Illinois State Auditing Act. If the
6 Auditor General finds that distributions have been expended
7 in violation of this Section, the Auditor General shall refer
8 the matter to the Attorney General. The Attorney General may
9 recover, in a civil action, 3 times the amount of any
10 distributions illegally expended. For purposes of this
11 subsection, the terms "financial audit," "compliance audit",
12 and "program audit" have the meanings ascribed to them in
13 Sections 1-13 and 1-15 of the Illinois State Auditing Act.
14 (Source: P.A. 89-448, eff. 3-14-96; 90-813, eff. 1-29-99.)
15 Section 99. Effective date. This Act takes effect upon
16 becoming law.