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92_SB1285enr SB1285 Enrolled LRB9207332SMtm 1 AN ACT concerning economic development. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 1. Short title. This Act may be cited as the 5 Corporate Headquarters Relocation Act. 6 Section 5. Purpose. The General Assembly has determined 7 that the relocation of the international headquarters of 8 large, multinational corporations from outside of Illinois to 9 a location within Illinois creates a substantial public 10 benefit and will foster economic growth and development 11 within the State. Specifically, these relocations will 12 foster a positive image of the State of Illinois and its 13 human and natural resources throughout the United States and 14 the world; contribute to a strong residential housing market; 15 directly and indirectly create jobs and additional taxes 16 within the State; encourage the relocation of other similar 17 businesses to the State; and otherwise foster the development 18 of commerce and industry within the State of Illinois. These 19 relocations should be encouraged through the use of 20 incentives that encourage long-term commitments by business 21 and industry to Illinois and that would otherwise not be 22 available through existing incentives programs. 23 Section 10. Definitions. As used in this Act: 24 "Corporate headquarters" means the building or buildings 25 that the principal executive officers of an eligible business 26 have designated as their principal offices and that has at 27 least 250 employees who are principally located in that 28 building or those buildings. The principal executive 29 officers may include, by way of example and not of 30 limitation, the chief executive officer, the chief operating SB1285 Enrolled -2- LRB9207332SMtm 1 officer, and other senior officer-level employees of the 2 eligible business. "Corporate headquarters" may also include 3 ancillary transportation facilities owned or leased by the 4 eligible business whether or not physically adjacent to the 5 principal office building or buildings used by the principal 6 executive officers. The ancillary transportation facilities 7 may include, but are not limited to, airplane hangars, 8 helipads or heliports, fixed base operations, maintenance 9 facilities, and other aviation-related facilities. All 10 employees of the eligible business may count toward the 11 satisfaction of the numeric requirement of this definition, 12 including but not limited to support staff and other 13 personnel who work in or from the office building or 14 buildings or transportation facilities. 15 "Department" means the Department of Commerce and 16 Community Affairs. 17 "Director" means the Director of Commerce and Community 18 Affairs. 19 "Eligible business" means a business that: (i) is engaged 20 in interstate or intrastate commerce; (ii) maintains its 21 corporate headquarters in a state other than Illinois as of 22 the effective date of this Act; (iii) had annual worldwide 23 revenues of at least $25,000,000,000 for the year immediately 24 preceding its application to the Department for the benefits 25 authorized by this Act; and (iv) is prepared to commit 26 contractually to relocating its corporate headquarters to the 27 State of Illinois in consideration of the benefits authorized 28 by this Act. 29 "Fund" means the Corporate Headquarters Relocation 30 Assistance Fund. 31 "Qualifying project" means the relocation of the 32 corporate headquarters of an eligible business from a 33 location outside of Illinois to a location within Illinois, 34 whether to an existing structure or otherwise. When the SB1285 Enrolled -3- LRB9207332SMtm 1 relocation involves an initial interim facility within 2 Illinois and a subsequent further relocation within 5 years 3 after the effective date of this Act to a permanent facility 4 also within Illinois, all those activities collectively 5 constitute a "qualifying project" under this Act. 6 "Relocation costs" means the expenses incurred by an 7 eligible business for a qualifying project, including, but 8 not limited to, the following: moving costs and related 9 expenses; purchase of new or replacement equipment; outside 10 professional fees and commissions; premiums for property and 11 casualty insurance coverage; capital investment costs; 12 financing costs; property assembly and development costs, 13 including, but not limited to, the purchase, lease, and 14 construction of equipment, buildings, and land, 15 infrastructure improvements and site development costs, 16 leasehold improvements costs, rehabilitation costs, and costs 17 of studies, surveys, development of plans, and professional 18 services costs such as architectural, engineering, legal, 19 financial, planning, or other related services; "relocation 20 costs", however, does not include moving costs associated 21 with the relocation of the personal residences of the 22 employees of the eligible business and does not include any 23 costs that do not directly result from the relocation of the 24 business to a location within Illinois. In determining 25 whether costs directly result from the relocation of the 26 business, the Department shall consider whether the costs 27 would likely have been incurred by the business if it had not 28 relocated from its original location. 29 Section 15. Powers of the Department. The Department, 30 in addition to the powers granted under the Civil 31 Administrative Code of Illinois, has all the powers necessary 32 and convenient to carry out and effectuate the purposes and 33 provisions of this Act, including, but not limited to, the SB1285 Enrolled -4- LRB9207332SMtm 1 power to: 2 (1) promulgate rules and establish procedures 3 deemed necessary and appropriate for the administration 4 of this Act; 5 (2) negotiate and execute any term, agreement, or 6 other document with any person, entity, or body politic 7 necessary or appropriate to accomplish the purposes of 8 this Act; 9 (3) fix, determine, charge, and collect premiums, 10 fees, charges, costs, and expenses from eligible 11 businesses, including, without limitation, application 12 fees, commitment fees, program fees, financing charges, 13 or publication fees as deemed appropriate to pay expenses 14 necessary or incident to the administration of the 15 Department's activities and duties under this Act, 16 including the preparation and enforcement of any 17 agreement, or for consultation services, legal services, 18 or other costs; 19 (4) require eligible businesses, upon written 20 request, to issue any necessary authorization to the 21 appropriate federal, state, or local authority for the 22 release of information concerning a qualifying project; 23 and 24 (5) take whatever actions are necessary or 25 appropriate to protect the State's interest in the event 26 of bankruptcy, default, foreclosure, or noncompliance 27 with the terms and conditions of any agreement entered 28 into pursuant to this Act, including the power to sell, 29 dispose, lease, or rent, upon terms and conditions 30 determined by the Director to be appropriate, real or 31 personal property that the Department may receive as a 32 result of these actions. 33 Section 20. Reimbursement for relocation costs. SB1285 Enrolled -5- LRB9207332SMtm 1 (a) The initial application of an eligible business 2 proposing a qualifying project must be filed with the 3 Department no later than July 1, 2004. 4 (b) Upon receipt and approval of an application from an 5 eligible business proposing a qualifying project, the 6 Department may enter into an agreement with the eligible 7 business wherein the Department agrees to reimburse the 8 eligible business for its relocation costs subject to the 9 following terms, conditions, and limitations: 10 (1) The eligible business must apply to the 11 Department for reimbursement of its relocation costs. 12 (2) The application submitted by the eligible 13 business must identify with specificity the relocation 14 costs for which reimbursement is sought, and the eligible 15 business must provide the Department with all supporting 16 documentation as requested by the Department. The 17 eligible business may amend its application for 18 reimbursement from time to time in order to cover 19 additional relocation costs incurred after the submission 20 of an initial application. 21 (3) The Department reserves the right to approve or 22 disapprove specific items and categories of relocation 23 costs. 24 (4) The eligible business must in fact relocate its 25 corporate headquarters to the State of Illinois within a 26 time frame specified by the Department. 27 (5) The eligible business may receive reimbursement 28 for not greater than 50% of its documented relocation 29 costs. 30 (6) The agreement between the Department and the 31 eligible business must provide that reimbursement will be 32 provided by means of one or more grants that shall be 33 issued annually by the Department for a period not to 34 exceed 10 years or until 50% of the eligible business' SB1285 Enrolled -6- LRB9207332SMtm 1 relocation costs are reimbursed, whichever occurs first. 2 (7) The amount of the annual grant that may be 3 issued to the eligible business by the Department may not 4 exceed 50% of the total amount withheld from employees of 5 the eligible business employed at the corporate 6 headquarters during the preceding calendar year under 7 Article 7 of the Illinois Income Tax Act. 8 (8) In applying to the Department for 9 reimbursement, the eligible business must certify the 10 total amount withheld during the preceding calendar year 11 under Article 7 of the Illinois Income Tax Act from its 12 employees employed at the corporate headquarters. 13 (9) The Department may issue grants from the 14 Corporate Headquarters Relocation Assistance Fund to 15 eligible businesses for reimbursement of relocation costs 16 as provided by this Act. 17 Section 25. Review of application for reimbursement. No 18 eligible business is eligible for reimbursement of relocation 19 costs under this Act unless the Department determines at the 20 time of the eligible business' initial application that, if 21 not for that reimbursement, the eligible business would not 22 have determined to relocate its corporate headquarters to 23 Illinois. The eligible business may satisfy this requirement 24 by, among other means, presenting evidence to the Department 25 that the eligible business has or had multi-state location 26 options and could reasonably and efficiently have located its 27 corporate headquarters to a state other than Illinois; by a 28 demonstration that at least one other state is or was being 29 considered for the location of its corporate headquarters; or 30 through evidence that receipt of the benefits authorized by 31 this Act is an important factor in the eligible business' 32 decision to locate its corporate headquarters to Illinois, 33 and that without that assistance, the eligible business SB1285 Enrolled -7- LRB9207332SMtm 1 likely would not establish its corporate headquarters in 2 Illinois. 3 Section 30. Transfers to Corporate Headquarters 4 Relocation Assistance Fund. Upon receipt of a certification 5 by the eligible business of the aggregate amount withheld 6 from its employees employed at the corporate headquarters 7 during the preceding calendar year under Article 7 of the 8 Illinois Income Tax Act, the Department shall then certify to 9 the State Treasurer that 50% of that amount is eligible to be 10 transferred from the General Revenue Fund to the Corporate 11 Headquarters Relocation Assistance Fund. This amount shall 12 be referred to as the "certified transfer amount". Upon 13 receipt of the certification from the Department, the 14 Treasurer shall transfer the certified transfer amount within 15 30 days from the General Revenue Fund to the Corporate 16 Headquarters Relocation Assistance Fund. 17 Section 35. Corporate Headquarters Relocation Assistance 18 Fund; creation. The Corporate Headquarters Relocation 19 Assistance Fund is created as a separate fund within the 20 State treasury. From the Fund and pursuant to the provisions 21 of this Act, the Department may issue grants to reimburse 22 eligible businesses for relocation costs incurred in 23 connection with the relocation of a corporate headquarters to 24 the State of Illinois. 25 Section 40. Other incentives. Nothing in this Act 26 precludes an eligible business with respect to a qualifying 27 project from applying for or receiving any other federal, 28 State, or local assistance or incentives in connection with 29 the relocation of its corporate headquarters to the State of 30 Illinois. SB1285 Enrolled -8- LRB9207332SMtm 1 Section 905. The State Finance Act is amended by adding 2 Section 5.545 as follows: 3 (30 ILCS 105/5.545 new) 4 Sec. 5.545. The Corporate Headquarters Relocation 5 Assistance Fund. 6 Section 910. The Illinois Income Tax Act is amended by 7 changing Section 211 as follows: 8 (35 ILCS 5/211) 9 Sec. 211. Economic Development for a Growing Economy Tax 10 Credit. For tax years beginning on or after January 1, 1999, 11 a Taxpayer who has entered into an Agreement under the 12 Economic Development for a Growing Economy Tax Credit Act is 13 entitled to a credit against the taxes imposed under 14 subsections (a) and (b) of Section 201 of this Act in an 15 amount to be determined in the Agreement. If the Taxpayer is 16 a partnership or Subchapter S corporation, the credit shall 17 be allowed to the partners or shareholders in accordance with 18 the determination of income and distributive share of income 19 under Sections 702 and 704 and subchapter S of the Internal 20 Revenue Code. The Department, in cooperation with the 21 Department of Commerce and Community Affairs, shall prescribe 22 rules to enforce and administer the provisions of this 23 Section. This Section is exempt from the provisions of 24 Section 250 of this Act. 25 The credit shall be subject to the conditions set forth 26 in the Agreement and the following limitations: 27 (1) The tax credit shall not exceed the Incremental 28 Income Tax (as defined in Section 5-5 of the Economic 29 Development for a Growing Economy Tax Credit Act) with 30 respect to the project. 31 (2) The amount of the credit allowed during the tax SB1285 Enrolled -9- LRB9207332SMtm 1 year plus the sum of all amounts allowed in prior years 2 shall not exceed 100% of the aggregate amount expended by 3 the Taxpayer during all prior tax years on approved costs 4 defined by Agreement. 5 (3) The amount of the credit shall be determined on 6 an annual basis. Except as applied in a carryover year 7 pursuant to Section 211(4) of this Act; however, the 8 credit may not be applied against any State income tax 9 liability in more thanmay not extend beyond10 taxable 10 years; provided, however, that (i) an eligible business 11 certified by the Department of Commerce and Community 12 Affairs under the Corporate Headquarters Relocation Act 13 may not apply the credit against any of its State income 14 tax liability in more than 15 taxable years and (ii) 15 credits allowed to that eligible business are subject to 16 the conditions and requirements set forth in Sections 17 5-35 and 5-45 of the Economic Development for a Growing 18 Economy Tax Credit Actafter the project is first19approved and may not extend beyond the expiration of the20Agreement. 21 (4) The credit may not exceed the amount of taxes 22 imposed pursuant to subsections (a) and (b) of Section 23 201 of this Act. Any credit that is unused in the year 24 the credit is computed may be carried forward and applied 25 to the tax liability of the 5 taxable years following the 26 excess credit year. The credit shall be applied to the 27 earliest year for which there is a tax liability. If 28 there are credits from more than one tax year that are 29 available to offset a liability, the earlier credit shall 30 be applied first. 31 (5) No credit shall be allowed with respect to any 32 Agreement for any taxable year ending after the 33 Noncompliance Date. Upon receiving notification by the 34 Department of Commerce and Community Affairs of the SB1285 Enrolled -10- LRB9207332SMtm 1 noncompliance of a Taxpayer with an Agreement, the 2 Department shall notify the Taxpayer that no credit is 3 allowed with respect to that Agreement for any taxable 4 year ending after the Noncompliance Date, as stated in 5 such notification. If any credit has been allowed with 6 respect to an Agreement for a taxable year ending after 7 the Noncompliance Date for that Agreement, any refund 8 paid to the Taxpayer for that taxable year shall, to the 9 extent of that credit allowed, be an erroneous refund 10 within the meaning of Section 912 of this Act. 11 (6) For purposes of this Section, the terms 12 "Agreement", "Incremental Income Tax", and 13 "Noncompliance Date" have the same meaning as when used 14 in the Economic Development for a Growing Economy Tax 15 Credit Act. 16 (Source: P.A. 91-476, eff. 8-11-99.) 17 Section 915. The Economic Development for a Growing 18 Economy Tax Credit Act is amended by changing Sections 5-35 19 and 5-45 as follows: 20 (35 ILCS 10/5-35) 21 Sec. 5-35. Relocation of jobs in Illinois. A taxpayer 22 is not entitled to claim the credit provided by this Act with 23 respect to any jobs that the taxpayer relocates from one 24 site in Illinois to another site in Illinois. A taxpayer with 25 respect to a qualifying project certified under the Corporate 26 Headquarters Relocation Act, however, is not subject to the 27 requirements of this Section but is nevertheless considered 28 an applicant for purposes of this Act. Moreover, any 29 full-time employee of an eligible business relocated to 30 Illinois in connection with that qualifying project is deemed 31 to be a new employee for purposes of this Act. Determinations 32 under this Section shall be made by the Department. SB1285 Enrolled -11- LRB9207332SMtm 1 (Source: P.A. 91-476, eff. 8-11-99.) 2 (35 ILCS 10/5-45) 3 Sec. 5-45. Amount and duration of the credit. 4 (a) The Department shall determine the amount and 5 duration of the credit awarded under this Act. The duration 6 of the credit may not exceed 10 taxable years. The credit may 7 be stated as a percentage of the Incremental Income Tax 8 attributable to the applicant's project and may include a 9 fixed dollar limitation. 10 (b) Notwithstanding subsection (a), and except as the 11 credit may be applied in a carryover year pursuant to Section 12 211(4) of the Illinois Income Tax Act, the credit may be 13 applied against the State income tax liability in more than 14 10 taxable years but not in more than 15 taxable years for an 15 eligible business that (i) qualifies under this Act and the 16 Corporate Headquarters Relocation Act and has in fact 17 undertaken a qualifying project within the time frame 18 specified by the Department of Commerce and Community Affairs 19 under that Act, and (ii) applies against its State income tax 20 liability, during the entire 15-year period, no more than 60% 21 of the maximum credit per year that would otherwise be 22 available under this Act. 23 (Source: P.A. 91-476, eff. 8-11-99.) 24 Section 920. The Property Tax Code is amended by 25 changing Section 18-165 as follows: 26 (35 ILCS 200/18-165) 27 Sec. 18-165. Abatement of taxes. 28 (a) Any taxing district, upon a majority vote of its 29 governing authority, may, after the determination of the 30 assessed valuation of its property, order the clerk of that 31 county to abate any portion of its taxes on the following SB1285 Enrolled -12- LRB9207332SMtm 1 types of property: 2 (1) Commercial and industrial. 3 (A) The property of any commercial or 4 industrial firm, including but not limited to the 5 property of any firm that is used for collecting, 6 separating, storing, or processing recycable 7 materials, locating within the taxing district 8 during the immediately preceding year from another 9 state, territory, or country, or having been newly 10 created within this State during the immediately 11 preceding year, or expanding an existing facility. 12 The abatement shall not exceed a period of 10 years 13 and the aggregate amount of abated taxes for all 14 taxing districts combined shall not exceed 15 $4,000,000; or 16 (B) The property of any commercial or 17 industrial development of at least 500 acres having 18 been created within the taxing district. The 19 abatement shall not exceed a period of 20 years and 20 the aggregate amount of abated taxes for all taxing 21 districts combined shall not exceed $12,000,000. 22 (C) The property of any commercial or 23 industrial firm currently located in the taxing 24 district that expands a facility or its number of 25 employees. The abatement shall not exceed a period 26 of 10 years and the aggregate amount of abated taxes 27 for all taxing districts combined shall not exceed 28 $4,000,000. The abatement period may be renewed at 29 the option of the taxing districts. 30 (2) Horse racing. Any property in the taxing 31 district which is used for the racing of horses and upon 32 which capital improvements consisting of expansion, 33 improvement or replacement of existing facilities have 34 been made since July 1, 1987. The combined abatements SB1285 Enrolled -13- LRB9207332SMtm 1 for such property from all taxing districts in any county 2 shall not exceed $5,000,000 annually and shall not exceed 3 a period of 10 years. 4 (3) Auto racing. Any property designed exclusively 5 for the racing of motor vehicles. Such abatement shall 6 not exceed a period of 10 years. 7 (4) Academic or research institute. The property 8 of any academic or research institute in the taxing 9 district that (i) is an exempt organization under 10 paragraph (3) of Section 501(c) of the Internal Revenue 11 Code, (ii) operates for the benefit of the public by 12 actually and exclusively performing scientific research 13 and making the results of the research available to the 14 interested public on a non-discriminatory basis, and 15 (iii) employs more than 100 employees. An abatement 16 granted under this paragraph shall be for at least 15 17 years and the aggregate amount of abated taxes for all 18 taxing districts combined shall not exceed $5,000,000. 19 (5) Housing for older persons. Any property in the 20 taxing district that is devoted exclusively to affordable 21 housing for older households. For purposes of this 22 paragraph, "older households" means those households (i) 23 living in housing provided under any State or federal 24 program that the Department of Human Rights determines is 25 specifically designed and operated to assist elderly 26 persons and is solely occupied by persons 55 years of age 27 or older and (ii) whose annual income does not exceed 80% 28 of the area gross median income, adjusted for family 29 size, as such gross income and median income are 30 determined from time to time by the United States 31 Department of Housing and Urban Development. The 32 abatement shall not exceed a period of 15 years, and the 33 aggregate amount of abated taxes for all taxing districts 34 shall not exceed $3,000,000. SB1285 Enrolled -14- LRB9207332SMtm 1 (6) Historical society. For assessment years 1998 2 through 2000, the property of an historical society 3 qualifying as an exempt organization under Section 4 501(c)(3) of the federal Internal Revenue Code. 5 (7) Recreational facilities. Any property in the 6 taxing district (i) that is used for a municipal airport, 7 (ii) that is subject to a leasehold assessment under 8 Section 9-195 of this Code and (iii) which is sublet from 9 a park district that is leasing the property from a 10 municipality, but only if the property is used 11 exclusively for recreational facilities or for parking 12 lots used exclusively for those facilities. The 13 abatement shall not exceed a period of 10 years. 14 (8) Relocated corporate headquarters. If approval 15 occurs within 5 years after the effective date of this 16 amendatory Act of the 92nd General Assembly, any property 17 or a portion of any property in a taxing district that is 18 used by an eligible business for a corporate headquarters 19 as defined in the Corporate Headquarters Relocation Act. 20 Instead of an abatement under this paragraph (8), a 21 taxing district may enter into an agreement with an 22 eligible business to make annual payments to that 23 eligible business in an amount not to exceed the property 24 taxes paid directly or indirectly by that eligible 25 business to the taxing district and any other taxing 26 districts for premises occupied pursuant to a written 27 lease and may make those payments without the need for an 28 annual appropriation. No school district, however, may 29 enter into an agreement with, or abate taxes for, an 30 eligible business unless the municipality in which the 31 corporate headquarters is located agrees to provide 32 funding to the school district in an amount equal to the 33 amount abated or paid by the school district as provided 34 in this paragraph (8). Any abatement ordered or SB1285 Enrolled -15- LRB9207332SMtm 1 agreement entered into under this paragraph (8) may be 2 effective for the entire term specified by the taxing 3 district, except the term of the abatement or annual 4 payments may not exceed 20 years. 5 (b) Upon a majority vote of its governing authority, any 6 municipality may, after the determination of the assessed 7 valuation of its property, order the county clerk to abate 8 any portion of its taxes on any property that is located 9 within the corporate limits of the municipality in accordance 10 with Section 8-3-18 of the Illinois Municipal Code. 11 (Source: P.A. 90-46, eff. 7-3-97; 90-415, eff. 8-15-97; 12 90-568, eff. 1-1-99; 90-655, eff. 7-30-98; 91-644, eff. 13 8-20-99; 91-885, eff. 7-6-00.) 14 Section 999. Effective date. This Act takes effect upon 15 becoming law.