100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB2766

 

Introduced , by Rep. Brandon W. Phelps

 

SYNOPSIS AS INTRODUCED:
 
55 ILCS 5/5-1006.7

    Amends the Counties Code. Provides that 1% of the school facility occupation taxes collected shall be distributed to the regional superintendent of schools (currently, these moneys are deposited into the Tax Compliance and Administration Fund) to cover the costs in administering and enforcing the provisions of the school facility occupation taxes Section of the Code.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB2766LRB100 10944 AWJ 21181 b

1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Counties Code is amended by changing Section
55-1006.7 as follows:
 
6    (55 ILCS 5/5-1006.7)
7    Sec. 5-1006.7. School facility occupation taxes.
8    (a) In any county, a tax shall be imposed upon all persons
9engaged in the business of selling tangible personal property,
10other than personal property titled or registered with an
11agency of this State's government, at retail in the county on
12the gross receipts from the sales made in the course of
13business to provide revenue to be used exclusively for school
14facility purposes if a proposition for the tax has been
15submitted to the electors of that county and approved by a
16majority of those voting on the question as provided in
17subsection (c). The tax under this Section shall be imposed
18only in one-quarter percent increments and may not exceed 1%.
19    This additional tax may not be imposed on the sale of food
20for human consumption that is to be consumed off the premises
21where it is sold (other than alcoholic beverages, soft drinks,
22and food that has been prepared for immediate consumption) and
23prescription and non-prescription medicines, drugs, medical

 

 

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1appliances and insulin, urine testing materials, syringes and
2needles used by diabetics. The Department of Revenue has full
3power to administer and enforce this subsection, to collect all
4taxes and penalties due under this subsection, to dispose of
5taxes and penalties so collected in the manner provided in this
6subsection, and to determine all rights to credit memoranda
7arising on account of the erroneous payment of a tax or penalty
8under this subsection. The Department shall deposit all taxes
9and penalties collected under this subsection into a special
10fund created for that purpose.
11    In the administration of and compliance with this
12subsection, the Department and persons who are subject to this
13subsection (i) have the same rights, remedies, privileges,
14immunities, powers, and duties, (ii) are subject to the same
15conditions, restrictions, limitations, penalties, and
16definitions of terms, and (iii) shall employ the same modes of
17procedure as are set forth in Sections 1 through 1o, 2 through
182-70 (in respect to all provisions contained in those Sections
19other than the State rate of tax), 2a through 2h, 3 (except as
20to the disposition of taxes and penalties collected), 4, 5, 5a,
215b, 5c, 5d, 5e, 5f, 5g, 5h, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 6d,
227, 8, 9, 10, 11, 11a, 12, and 13 of the Retailers' Occupation
23Tax Act and all provisions of the Uniform Penalty and Interest
24Act as if those provisions were set forth in this subsection.
25    The certificate of registration that is issued by the
26Department to a retailer under the Retailers' Occupation Tax

 

 

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1Act permits the retailer to engage in a business that is
2taxable without registering separately with the Department
3under an ordinance or resolution under this subsection.
4    Persons subject to any tax imposed under the authority
5granted in this subsection may reimburse themselves for their
6seller's tax liability by separately stating that tax as an
7additional charge, which may be stated in combination, in a
8single amount, with State tax that sellers are required to
9collect under the Use Tax Act, pursuant to any bracketed
10schedules set forth by the Department.
11    (b) If a tax has been imposed under subsection (a), then a
12service occupation tax must also be imposed at the same rate
13upon all persons engaged, in the county, in the business of
14making sales of service, who, as an incident to making those
15sales of service, transfer tangible personal property within
16the county as an incident to a sale of service.
17    This tax may not be imposed on sales of food for human
18consumption that is to be consumed off the premises where it is
19sold (other than alcoholic beverages, soft drinks, and food
20prepared for immediate consumption) and prescription and
21non-prescription medicines, drugs, medical appliances and
22insulin, urine testing materials, syringes, and needles used by
23diabetics.
24    The tax imposed under this subsection and all civil
25penalties that may be assessed as an incident thereof shall be
26collected and enforced by the Department and deposited into a

 

 

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1special fund created for that purpose. The Department has full
2power to administer and enforce this subsection, to collect all
3taxes and penalties due under this subsection, to dispose of
4taxes and penalties so collected in the manner provided in this
5subsection, and to determine all rights to credit memoranda
6arising on account of the erroneous payment of a tax or penalty
7under this subsection.
8    In the administration of and compliance with this
9subsection, the Department and persons who are subject to this
10subsection shall (i) have the same rights, remedies,
11privileges, immunities, powers and duties, (ii) be subject to
12the same conditions, restrictions, limitations, penalties and
13definition of terms, and (iii) employ the same modes of
14procedure as are set forth in Sections 2 (except that that
15reference to State in the definition of supplier maintaining a
16place of business in this State means the county), 2a through
172d, 3 through 3-50 (in respect to all provisions contained in
18those Sections other than the State rate of tax), 4 (except
19that the reference to the State shall be to the county), 5, 7,
208 (except that the jurisdiction to which the tax is a debt to
21the extent indicated in that Section 8 is the county), 9
22(except as to the disposition of taxes and penalties
23collected), 10, 11, 12 (except the reference therein to Section
242b of the Retailers' Occupation Tax Act), 13 (except that any
25reference to the State means the county), Section 15, 16, 17,
2618, 19, and 20 of the Service Occupation Tax Act and all

 

 

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1provisions of the Uniform Penalty and Interest Act, as fully as
2if those provisions were set forth herein.
3    Persons subject to any tax imposed under the authority
4granted in this subsection may reimburse themselves for their
5serviceman's tax liability by separately stating the tax as an
6additional charge, which may be stated in combination, in a
7single amount, with State tax that servicemen are authorized to
8collect under the Service Use Tax Act, pursuant to any
9bracketed schedules set forth by the Department.
10    (c) The tax under this Section may not be imposed until the
11question of imposing the tax has been submitted to the electors
12of the county at a regular election and approved by a majority
13of the electors voting on the question. For all regular
14elections held prior to August 23, 2011 (the effective date of
15Public Act 97-542), upon a resolution by the county board or a
16resolution by school district boards that represent at least
1751% of the student enrollment within the county, the county
18board must certify the question to the proper election
19authority in accordance with the Election Code.
20    For all regular elections held prior to August 23, 2011
21(the effective date of Public Act 97-542), the election
22authority must submit the question in substantially the
23following form:
24        Shall (name of county) be authorized to impose a
25    retailers' occupation tax and a service occupation tax
26    (commonly referred to as a "sales tax") at a rate of

 

 

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1    (insert rate) to be used exclusively for school facility
2    purposes?
3The election authority must record the votes as "Yes" or "No".
4    If a majority of the electors voting on the question vote
5in the affirmative, then the county may, thereafter, impose the
6tax.
7    For all regular elections held on or after August 23, 2011
8(the effective date of Public Act 97-542), the regional
9superintendent of schools for the county must, upon receipt of
10a resolution or resolutions of school district boards that
11represent more than 50% of the student enrollment within the
12county, certify the question to the proper election authority
13for submission to the electors of the county at the next
14regular election at which the question lawfully may be
15submitted to the electors, all in accordance with the Election
16Code.
17    For all regular elections held on or after August 23, 2011
18(the effective date of Public Act 97-542), the election
19authority must submit the question in substantially the
20following form:
21        Shall a retailers' occupation tax and a service
22    occupation tax (commonly referred to as a "sales tax") be
23    imposed in (name of county) at a rate of (insert rate) to
24    be used exclusively for school facility purposes?
25The election authority must record the votes as "Yes" or "No".
26    If a majority of the electors voting on the question vote

 

 

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1in the affirmative, then the tax shall be imposed at the rate
2set forth in the question.
3    For the purposes of this subsection (c), "enrollment" means
4the head count of the students residing in the county on the
5last school day of September of each year, which must be
6reported on the Illinois State Board of Education Public School
7Fall Enrollment/Housing Report.
8    (d) The Department shall immediately pay over to the State
9Treasurer, ex officio, as trustee, all taxes and penalties
10collected under this Section to be deposited into the School
11Facility Occupation Tax Fund, which shall be an unappropriated
12trust fund held outside the State treasury.
13    On or before the 25th day of each calendar month, the
14Department shall prepare and certify to the Comptroller the
15disbursement of stated sums of money to the regional
16superintendents of schools in counties from which retailers or
17servicemen have paid taxes or penalties to the Department
18during the second preceding calendar month. The amount to be
19paid to each regional superintendent of schools and disbursed
20to him or her in accordance with Section 3-14.31 of the School
21Code, is equal to the amount (not including credit memoranda)
22collected from the county under this Section during the second
23preceding calendar month by the Department, (i) less 2% of that
24amount, of which 1% shall be deposited into the Tax Compliance
25and Administration Fund and shall be used by the Department,
26subject to appropriation, to cover the costs of the Department

 

 

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1in administering and enforcing the provisions of this Section,
2on behalf of the county, and 1% shall be distributed to the
3regional superintendent of schools to cover the costs in
4administering and enforcing the provisions of this Section,
5(ii) plus an amount that the Department determines is necessary
6to offset any amounts that were erroneously paid to a different
7taxing body; (iii) less an amount equal to the amount of
8refunds made during the second preceding calendar month by the
9Department on behalf of the county; and (iv) less any amount
10that the Department determines is necessary to offset any
11amounts that were payable to a different taxing body but were
12erroneously paid to the county. When certifying the amount of a
13monthly disbursement to a regional superintendent of schools
14under this Section, the Department shall increase or decrease
15the amounts by an amount necessary to offset any miscalculation
16of previous disbursements within the previous 6 months from the
17time a miscalculation is discovered.
18    Within 10 days after receipt by the Comptroller from the
19Department of the disbursement certification to the regional
20superintendents of the schools provided for in this Section,
21the Comptroller shall cause the orders to be drawn for the
22respective amounts in accordance with directions contained in
23the certification.
24    If the Department determines that a refund should be made
25under this Section to a claimant instead of issuing a credit
26memorandum, then the Department shall notify the Comptroller,

 

 

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1who shall cause the order to be drawn for the amount specified
2and to the person named in the notification from the
3Department. The refund shall be paid by the Treasurer out of
4the School Facility Occupation Tax Fund.
5    (e) For the purposes of determining the local governmental
6unit whose tax is applicable, a retail sale by a producer of
7coal or another mineral mined in Illinois is a sale at retail
8at the place where the coal or other mineral mined in Illinois
9is extracted from the earth. This subsection does not apply to
10coal or another mineral when it is delivered or shipped by the
11seller to the purchaser at a point outside Illinois so that the
12sale is exempt under the United States Constitution as a sale
13in interstate or foreign commerce.
14    (f) Nothing in this Section may be construed to authorize a
15tax to be imposed upon the privilege of engaging in any
16business that under the Constitution of the United States may
17not be made the subject of taxation by this State.
18    (g) If a county board imposes a tax under this Section
19pursuant to a referendum held before August 23, 2011 (the
20effective date of Public Act 97-542) at a rate below the rate
21set forth in the question approved by a majority of electors of
22that county voting on the question as provided in subsection
23(c), then the county board may, by ordinance, increase the rate
24of the tax up to the rate set forth in the question approved by
25a majority of electors of that county voting on the question as
26provided in subsection (c). If a county board imposes a tax

 

 

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1under this Section pursuant to a referendum held before August
223, 2011 (the effective date of Public Act 97-542), then the
3board may, by ordinance, discontinue or reduce the rate of the
4tax. If a tax is imposed under this Section pursuant to a
5referendum held on or after August 23, 2011 (the effective date
6of Public Act 97-542), then the county board may reduce or
7discontinue the tax, but only in accordance with subsection
8(h-5) of this Section. If, however, a school board issues bonds
9that are secured by the proceeds of the tax under this Section,
10then the county board may not reduce the tax rate or
11discontinue the tax if that rate reduction or discontinuance
12would adversely affect the school board's ability to pay the
13principal and interest on those bonds as they become due or
14necessitate the extension of additional property taxes to pay
15the principal and interest on those bonds. If the county board
16reduces the tax rate or discontinues the tax, then a referendum
17must be held in accordance with subsection (c) of this Section
18in order to increase the rate of the tax or to reimpose the
19discontinued tax.
20    Until January 1, 2014, the results of any election that
21imposes, reduces, or discontinues a tax under this Section must
22be certified by the election authority, and any ordinance that
23increases or lowers the rate or discontinues the tax must be
24certified by the county clerk and, in each case, filed with the
25Illinois Department of Revenue either (i) on or before the
26first day of April, whereupon the Department shall proceed to

 

 

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1administer and enforce the tax or change in the rate as of the
2first day of July next following the filing; or (ii) on or
3before the first day of October, whereupon the Department shall
4proceed to administer and enforce the tax or change in the rate
5as of the first day of January next following the filing.
6    Beginning January 1, 2014, the results of any election that
7imposes, reduces, or discontinues a tax under this Section must
8be certified by the election authority, and any ordinance that
9increases or lowers the rate or discontinues the tax must be
10certified by the county clerk and, in each case, filed with the
11Illinois Department of Revenue either (i) on or before the
12first day of May, whereupon the Department shall proceed to
13administer and enforce the tax or change in the rate as of the
14first day of July next following the filing; or (ii) on or
15before the first day of October, whereupon the Department shall
16proceed to administer and enforce the tax or change in the rate
17as of the first day of January next following the filing.
18    (h) For purposes of this Section, "school facility
19purposes" means (i) the acquisition, development,
20construction, reconstruction, rehabilitation, improvement,
21financing, architectural planning, and installation of capital
22facilities consisting of buildings, structures, and durable
23equipment and for the acquisition and improvement of real
24property and interest in real property required, or expected to
25be required, in connection with the capital facilities and (ii)
26the payment of bonds or other obligations heretofore or

 

 

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1hereafter issued, including bonds or other obligations
2heretofore or hereafter issued to refund or to continue to
3refund bonds or other obligations issued, for school facility
4purposes, provided that the taxes levied to pay those bonds are
5abated by the amount of the taxes imposed under this Section
6that are used to pay those bonds. "School-facility purposes"
7also includes fire prevention, safety, energy conservation,
8accessibility, school security, and specified repair purposes
9set forth under Section 17-2.11 of the School Code.
10    (h-5) A county board in a county where a tax has been
11imposed under this Section pursuant to a referendum held on or
12after August 23, 2011 (the effective date of Public Act 97-542)
13may, by ordinance or resolution, submit to the voters of the
14county the question of reducing or discontinuing the tax. In
15the ordinance or resolution, the county board shall certify the
16question to the proper election authority in accordance with
17the Election Code. The election authority must submit the
18question in substantially the following form:
19        Shall the school facility retailers' occupation tax
20    and service occupation tax (commonly referred to as the
21    "school facility sales tax") currently imposed in (name of
22    county) at a rate of (insert rate) be (reduced to (insert
23    rate))(discontinued)?
24If a majority of the electors voting on the question vote in
25the affirmative, then, subject to the provisions of subsection
26(g) of this Section, the tax shall be reduced or discontinued

 

 

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1as set forth in the question.
2    (i) This Section does not apply to Cook County.
3    (j) This Section may be cited as the County School Facility
4Occupation Tax Law.
5(Source: P.A. 98-584, eff. 8-27-13; 99-143, eff. 7-27-15;
699-217, eff. 7-31-15; 99-642, eff. 7-28-16.)