HB3239 97TH GENERAL ASSEMBLY

LRB097 10544 HLH 50884 b

97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB3239

Introduced 2/24/2011, by Rep. Chad Hays

SYNOPSIS AS INTRODUCED:

35 ILCS 120/1f	from Ch. 120, par. 440f
220 ILCS 5/9-222.1	from Ch. 111 2/3, par. 9-222.1

Amends the Retailers' Occupation Tax Act. Provides that the exemption for property used in an enterprise zone applies to businesses that make investments of at least $20,000,000 and cause the creation of a minimum of 40 (instead of 200) full-time jobs in Illinois or make investments that cause the retention of a minimum of 500 (instead of 2,000) full-time jobs in Illinois. Amends the Public Utilities Act. Provides that the exemption for businesses located in an enterprise zone applies to businesses that (i) make investments of at least $20,000,000 and cause the creation of a minimum of 40 (instead of 200) full-time equivalent jobs in Illinois, (ii) make investments of at least $175,000,000 which cause the creation of a minimum of 30 (instead of 150) full-time equivalent jobs in Illinois, or (iii) make investments of at least $100,000,000 which cause the retention of a minimum of 200 (instead of 1,000) full-time jobs in Illinois.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Retailers' Occupation Tax Act is amended by changing Section 1f as follows:

(35 ILCS 120/1f) (from Ch. 120, par. 440f)

Sec. 1f. Except for High Impact Businesses, the exemption stated in Sections 1d and 1e of this Act shall only apply to business enterprises which:

(1) either (i) make investments of at least $20,000,000 which cause the creation of a minimum of 40 200 full-time equivalent jobs in Illinois or (ii) make investments which cause the retention of a minimum of 500 2000 full-time jobs in Illinois or (iii) make investments of a minimum of $40,000,000 and retain at least 90% of the jobs in place on the date on which the exemption is granted and for the duration of the exemption; and

(2) are located in an Enterprise Zone established pursuant to the Illinois Enterprise Zone Act; and

(3) are certified by the Department of Commerce and Economic Opportunity as complying with the requirements specified in clauses (1), (2) and (3).

Any business enterprise seeking to avail itself of the exemptions stated in Sections 1d or 1e, or both, shall make application to the Department of Commerce and Economic Opportunity in such form and providing such information as may be prescribed by the Department of Commerce and Economic Opportunity. However, no business enterprise shall be required, as a condition for certification under clause (4) of this Section, to attest that its decision to invest under clause (1) of this Section and to locate under clause (2) of this Section is predicated upon the availability of the exemptions authorized by Sections 1d or 1e.

The Department of Commerce and Economic Opportunity shall determine whether the business enterprise meets the criteria prescribed in this Section. If the Department of Commerce and Economic Opportunity determines that such business enterprise meets the criteria, it shall issue a certificate of eligibility for exemption to the business enterprise in such form as is prescribed by the Department of Revenue. The Department of Commerce and Economic Opportunity shall act upon such certification requests within 60 days after receipt of the application, and shall file with the Department of Revenue a copy of each certificate of eligibility for exemption.

The Department of Commerce and Economic Opportunity shall have the power to promulgate rules and regulations to carry out the provisions of this Section including the power to define the amounts and types of eligible investments not specified in this Section which business enterprises must make in order to receive the exemptions stated in Sections 1d and 1e of this Act; and to require that any business enterprise that is granted a tax exemption repay the exempted tax if the business enterprise fails to comply with the terms and conditions of the certification.

Such certificate of eligibility for exemption shall be presented by the business enterprise to its supplier when making the initial purchase of tangible personal property for which an exemption is granted by Section 1d or Section 1e, or both, together with a certification by the business enterprise that such tangible personal property is exempt from taxation under Section 1d or Section 1e and by indicating the exempt status of each subsequent purchase on the face of the purchase order.

The Department of Commerce and Economic Opportunity shall determine the period during which such exemption from the taxes imposed under this Act is in effect which shall not exceed 20 years.

(Source: P.A. 94-793, eff. 5-19-06.)

Section 10. The Public Utilities Act is amended by changing Section 9-222.1 as follows:

(220 ILCS 5/9-222.1) (from Ch. 111 2/3, par. 9-222.1)

Sec. 9-222.1. A business enterprise which is located within an area designated by a county or municipality as an enterprise zone pursuant to the Illinois Enterprise Zone Act or located in a federally designated Foreign Trade Zone or Sub-Zone shall be exempt from the additional charges added to the business enterprise's utility bills as a pass-on of municipal and State utility taxes under Sections 9-221 and 9-222 of this Act, to the extent such charges are exempted by ordinance adopted in accordance with paragraph (e) of Section 8-11-2 of the Illinois Municipal Code in the case of municipal utility taxes, and to the extent such charges are exempted by the percentage specified by the Department of Commerce and Economic Opportunity in the case of State utility taxes, provided such business enterprise meets the following criteria:

(1) it (i) makes investments of at least $20,000,000 which cause the creation of a minimum of 40 200 full-time equivalent jobs in Illinois; (ii) makes investments of at least $175,000,000 which cause the creation of a minimum of 30 150 full-time equivalent jobs in Illinois; (iii) makes investments that cause the retention of a minimum of 300 full-time equivalent jobs in the manufacturing sector, as defined by the North American Industry Classification System, in an area in Illinois in which the unemployment rate is above 9% and makes an application to the Department within 3 months after the effective date of this amendatory Act of the 96th General Assembly and certifies relocation of the 300 full-time equivalent jobs within 36 months after the application; (iv) makes investments of at least $100,000,000 which cause the retention of a minimum of 200 1,000 full-time jobs in Illinois; or (v) makes an application to the Department within 2 months after the effective date of this amendatory Act of the 96th General Assembly and makes investments that cause the retention of a minimum of 500 full-time equivalent jobs in 2009 and 2010, 675 full-time jobs in Illinois in 2011, 850 full-time jobs in 2012, and 1,000 full-time jobs in 2013, in the manufacturing sector as defined by the North American Industry Classification System; and

(2) it is either (i) located in an Enterprise Zone established pursuant to the Illinois Enterprise Zone Act or (ii) located in a federally designated Foreign Trade Zone or Sub-Zone and is designated a High Impact Business by the Department of Commerce and Economic Opportunity; and

(3) it is certified by the Department of Commerce and Economic Opportunity as complying with the requirements specified in clauses (1) and (2) of this Section.

The Department of Commerce and Economic Opportunity shall determine the period during which such exemption from the charges imposed under Section 9-222 is in effect which shall not exceed 30 years or the certified term of the enterprise zone, whichever period is shorter, except that the exemption period for a business enterprise qualifying under item (iii) of clause (1) of this Section shall not exceed 30 years.

The Department of Commerce and Economic Opportunity shall have the power to promulgate rules and regulations to carry out the provisions of this Section including procedures for complying with the requirements specified in clauses (1) and (2) of this Section and procedures for applying for the exemptions authorized under this Section; to define the amounts and types of eligible investments which business enterprises must make in order to receive State utility tax exemptions pursuant to Sections 9-222 and 9-222.1 of this Act; to approve such utility tax exemptions for business enterprises whose investments are not yet placed in service; and to require that business enterprises granted tax exemptions repay the exempted tax should the business enterprise fail to comply with the terms and conditions of the certification. However, no business enterprise shall be required, as a condition for certification under clause (3) of this Section, to attest that its decision to invest under clause (1) of this Section and to locate under clause (2) of this Section is predicated upon the availability of the exemptions authorized by this Section.

A business enterprise shall be exempt, in whole or in part, from the pass-on charges of municipal utility taxes imposed under Section 9-221, only if it meets the criteria specified in clauses (1) through (3) of this Section and the municipality has adopted an ordinance authorizing the exemption under paragraph (e) of Section 8-11-2 of the Illinois Municipal Code. Upon certification of the business enterprises by the Department of Commerce and Economic Opportunity, the Department of Commerce and Economic Opportunity shall notify the Department of Revenue of such certification. The Department of Revenue shall notify the public utilities of the exemption status of business enterprises from the pass-on charges of State and municipal utility taxes. Such exemption status shall be effective within 3 months after certification of the business enterprise.

(Source: P.A. 96-716, eff. 8-25-09; 96-865, eff. 1-21-10.)