103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB3905

 

Introduced 2/28/2024, by Sen. Cristina Castro

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 17/10-10
35 ILCS 17/10-20

    Amends the Live Theater Production Tax Credit Act. Provides that a pre-Broadway production must be performed with the goal of having a presentation scheduled for Broadway's Theater District in New York City after its Illinois presentation (currently, the production must have a presentation scheduled for Broadway's Theater District in New York City within 12 months after its Illinois presentation). Provides that the total amount of tax credits awarded pursuant to the Act for the State fiscal year ending on June 30, 2024 shall not exceed $4,000,000 (currently, $2,000,000). Effective immediately.


LRB103 37820 HLH 67950 b

 

 

A BILL FOR

 

SB3905LRB103 37820 HLH 67950 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Live Theater Production Tax Credit Act is
5amended by changing Sections 10-10 and 10-20 as follows:
 
6    (35 ILCS 17/10-10)
7    Sec. 10-10. Definitions. As used in this Act:
8    "Accredited theater production" means a for-profit live
9stage presentation in a qualified production facility, as
10defined in this Section, that is either (i) a pre-Broadway
11production or (ii) a long-run production for which the
12aggregate Illinois labor and marketing expenditures exceed
13$100,000. For credits awarded under this Act in State Fiscal
14Year 2023, "accredited theater production" also includes any
15commercial Broadway touring show.
16    "Commercial Broadway touring show" means a production that
17(i) is performed in a qualified production facility and plays
18in more than 2 other markets in North America outside of
19Illinois within 12 months of its Illinois presentation and
20(ii) has Illinois production spending of not less than
21$100,000, as shown on the applicant's application for the
22credit.
23    "Pre-Broadway production" means a live stage production

 

 

SB3905- 2 -LRB103 37820 HLH 67950 b

1that, in its original or adaptive version, is performed in a
2qualified production facility with the goal of having a
3presentation scheduled for Broadway's Theater District in New
4York City within 12 months after its Illinois presentation.
5    "Long-run production" means a live stage production that
6is performed in a qualified production facility for longer
7than 8 weeks, with at least 6 performances per week, and
8includes a production that spans the end of one tax year and
9the commencement of a new tax year that, in combination, meets
10the criteria set forth in this definition making it a long-run
11production eligible for a theater tax credit award in each tax
12year or portion thereof.
13    "Accredited theater production certificate" means a
14certificate issued by the Department certifying that the
15production is an accredited theater production that meets the
16guidelines of this Act.
17    "Applicant" means a taxpayer that is a theater producer,
18owner, licensee, operator, or presenter that is presenting or
19has presented a live stage presentation located within the
20State of Illinois who:
21        (1) owns or licenses the theatrical rights of the
22    stage presentation for the Illinois production period; or
23        (2) has contracted or will contract directly with the
24    owner or licensee of the theatrical rights or a person
25    acting on behalf of the owner or licensee to provide live
26    performances of the production.

 

 

SB3905- 3 -LRB103 37820 HLH 67950 b

1    An applicant that directly or indirectly owns, controls,
2or operates multiple qualified production facilities shall be
3presumed to be and considered for the purposes of this Act to
4be a single applicant; provided, however, that as to each of
5the applicant's qualified production facilities, the applicant
6shall be eligible to separately and contemporaneously (i)
7apply for and obtain accredited theater production
8certificates, (ii) stage accredited theater productions, and
9(iii) apply for and receive a tax credit award certificate for
10each of the applicant's accredited theater productions
11performed at each of the applicant's qualified production
12facilities.
13    "Department" means the Department of Commerce and Economic
14Opportunity.
15    "Director" means the Director of the Department.
16    "Illinois labor expenditure" means gross salary or wages
17including, but not limited to, taxes, benefits, and any other
18consideration incurred or paid to non-talent employees of the
19applicant for services rendered to and on behalf of the
20accredited theater production. To qualify as an Illinois labor
21expenditure, the expenditure must be:
22        (1) incurred or paid by the applicant on or after the
23    effective date of the Act for services related to any
24    portion of an accredited theater production from its
25    pre-production stages, including, but not limited to, the
26    writing of the script, casting, hiring of service

 

 

SB3905- 4 -LRB103 37820 HLH 67950 b

1    providers, purchases from vendors, marketing, advertising,
2    public relations, load in, rehearsals, performances, other
3    accredited theater production related activities, and load
4    out;
5        (2) directly attributable to the accredited theater
6    production;
7        (3) limited to the first $100,000 of wages incurred or
8    paid to each employee of an accredited theater production
9    in each tax year;
10        (4) included in the federal income tax basis of the
11    property;
12        (5) paid in the tax year for which the applicant is
13    claiming the tax credit award, or no later than 60 days
14    after the end of the tax year;
15        (6) paid to persons residing in Illinois at the time
16    payments were made; and
17        (7) reasonable in the circumstances.
18    "Illinois production spending" means any and all expenses
19directly or indirectly incurred relating to an accredited
20theater production presented in any qualified production
21facility of the applicant, including, but not limited to,
22expenditures for:
23        (1) national marketing, public relations, and the
24    creation and placement of print, electronic, television,
25    billboard, and other forms of advertising; and
26        (2) the construction and fabrication of scenic

 

 

SB3905- 5 -LRB103 37820 HLH 67950 b

1    materials and elements; provided, however, that the
2    maximum amount of expenditures attributable to the
3    construction and fabrication of scenic materials and
4    elements eligible for a tax credit award shall not exceed
5    $500,000 per applicant per production in any single tax
6    year.
7    "Qualified production facility" means a facility located
8in the State in which live theatrical productions are, or are
9intended to be, exclusively presented that contains at least
10one stage, a seating capacity of 1,200 or more seats, and
11dressing rooms, storage areas, and other ancillary amenities
12necessary for the accredited theater production.
13    "Tax credit award" means the issuance to a taxpayer by the
14Department of a tax credit award in conformance with Sections
1510-40 and 10-45 of this Act.
16    "Tax year" means a calendar year for the period January 1
17to and including December 31.
18(Source: P.A. 102-1112, eff. 12-21-22.)
 
19    (35 ILCS 17/10-20)
20    Sec. 10-20. Tax credit award. Subject to the conditions
21set forth in this Act, an applicant is entitled to a tax credit
22award as approved by the Department for qualifying Illinois
23labor expenditures and Illinois production spending for each
24tax year in which the applicant is awarded an accredited
25theater production certificate issued by the Department. The

 

 

SB3905- 6 -LRB103 37820 HLH 67950 b

1amount of tax credits awarded pursuant to this Act shall not
2exceed $2,000,000 in any State fiscal year, except that the
3amount of tax credits awarded pursuant to this Act for the
4State fiscal year ending on June 30, 2023 and the State fiscal
5year ending on June 30, 2024 shall not exceed $4,000,000 in
6either of those fiscal years. For the State fiscal year ending
7on June 30, 2023 and the State fiscal year ending on June 30,
82024, no more than $2,000,000 in credits may be awarded in
9either of those fiscal years to accredited theater productions
10that are not commercial Broadway touring shows, and no more
11than $2,000,000 in credits may be awarded in either of those
12fiscal years to commercial Broadway touring shows. Credits
13shall be awarded on a first-come, first-served basis.
14Notwithstanding the foregoing, if the amount of credits
15applied for in any fiscal year exceeds the amount authorized
16to be awarded under this Section, the excess credit amount
17shall be awarded in the next fiscal year in which credits
18remain available for award and shall be treated as having been
19applied for on the first day of that fiscal year.
20(Source: P.A. 102-700, eff. 4-19-22; 102-1112, eff. 12-21-22.)
 
21    Section 99. Effective date. This Act takes effect upon
22becoming law.