Illinois General Assembly - Full Text of SB1983
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Full Text of SB1983  102nd General Assembly




SB1983 EngrossedLRB102 16117 HLH 21492 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 Corporate Accountability for Tax
5Expenditures Act is amended by changing Section 25 as follows:
6    (20 ILCS 715/25)
7    Sec. 25. Recapture.
8    (a) All development assistance agreements shall contain,
9at a minimum, the following recapture provisions:
10        (1) The recipient must (i) make the level of capital
11    investment in the economic development project specified
12    in the development assistance agreement; (ii) create or
13    retain, or both, the requisite number of jobs, paying not
14    less than specified wages for the created and retained
15    jobs, within and for the duration of the time period
16    specified in the legislation authorizing, or the
17    administrative rules implementing, the development
18    assistance programs and the development assistance
19    agreement.
20        (2) If the recipient fails to create or retain the
21    requisite number of jobs within and for the time period
22    specified, in the legislation authorizing, or the
23    administrative rules implementing, the development



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1    assistance programs and the development assistance
2    agreement, the recipient shall be deemed to no longer
3    qualify for the State economic assistance and the
4    applicable recapture provisions shall take effect.
5        (3) If the recipient receives State economic
6    assistance in the form of a High Impact Business
7    designation pursuant to Section 5.5 of the Illinois
8    Enterprise Zone Act and the business receives the benefit
9    of the exemption authorized under Section 5l of the
10    Retailers' Occupation Tax Act (for the sale of building
11    materials incorporated into a High Impact Business
12    location) or the utility tax exemption authorized under
13    Section 9-222.1A of the Public Utilities Act and the
14    recipient fails to create or retain the requisite number
15    of jobs, as determined by the legislation authorizing the
16    development assistance programs or the administrative
17    rules implementing such legislation, or both, within the
18    requisite period of time, the recipient shall be required
19    to pay to the State the full amount of both the State tax
20    exemption and the utility tax exemption that it received
21    as a result of the High Impact Business designation.
22        (4) If the recipient receives a grant or loan pursuant
23    to the Large Business Development Program, the Business
24    Development Public Infrastructure Program, or the
25    Industrial Training Program and the recipient fails to
26    create or retain the requisite number of jobs for the



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1    requisite time period, as provided in the legislation
2    authorizing the development assistance programs or the
3    administrative rules implementing such legislation, or
4    both, or in the development assistance agreement, the
5    recipient shall be required to repay to the State a pro
6    rata amount of the grant; that amount shall reflect the
7    percentage of the deficiency between the requisite number
8    of jobs to be created or retained by the recipient and the
9    actual number of such jobs in existence as of the date the
10    Department determines the recipient is in breach of the
11    job creation or retention covenants contained in the
12    development assistance agreement. If the recipient of
13    development assistance under the Large Business
14    Development Program, the Business Development Public
15    Infrastructure Program, or the Industrial Training Program
16    ceases operations at the specific project site, during the
17    5-year period commencing on the date of assistance, the
18    recipient shall be required to repay the entire amount of
19    the grant or to accelerate repayment of the loan back to
20    the State.
21        (5) Except as provided in paragraph (5.1), if If the
22    recipient receives a tax credit under the Economic
23    Development for a Growing Economy tax credit program, the
24    development assistance agreement must provide that (i) if
25    the number of new or retained employees falls below the
26    requisite number set forth in the development assistance



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1    agreement, the allowance of the credit shall be
2    automatically suspended until the number of new and
3    retained employees equals or exceeds the requisite number
4    in the development assistance agreement; (ii) if the
5    recipient discontinues operations at the specific project
6    site during the 5-year period after the beginning of the
7    first tax year for which the Department issues a tax
8    credit certificate, the recipient shall forfeit all
9    credits taken by the recipient during such 5-year period;
10    and (iii) in the event of a revocation or suspension of the
11    credit, the Department shall contact the Director of
12    Revenue to initiate proceedings against the recipient to
13    recover wrongfully exempted Illinois State income taxes
14    and the recipient shall promptly repay to the Department
15    of Revenue any wrongfully exempted Illinois State income
16    taxes. The forfeited amount of credits shall be deemed
17    assessed on the date the Department contacts the
18    Department of Revenue and the recipient shall promptly
19    repay to the Department of Revenue any wrongfully exempted
20    Illinois State income taxes.
21        (5.1) For taxable years that begin on or after January
22    1, 2020 and begin prior to January 1, 2022, credits
23    awarded under the Economic Development for a Growing
24    Economy tax credit program shall not be revoked or
25    suspended as a result of the recipient's failure to meet
26    the requirements for new or retained employees if that



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1    failure is due to a direct and substantial hardship caused
2    by the COVID-19 pandemic and the Taxpayer maintains job
3    creation and retention at the level of 85% of the
4    Agreement requirements. For the Department to grant relief
5    under this paragraph (5.1), proof of a direct and
6    substantial hardship caused by the COVID-19 pandemic must
7    be submitted to the Department during the annual
8    certificate of verification issuance process.
9    (b) The Director may elect to waive enforcement of any
10contractual provision arising out of the development
11assistance agreement required by this Act based on a finding
12that the waiver is necessary to avert an imminent and
13demonstrable hardship to the recipient that may result in such
14recipient's insolvency or discharge of workers. If a waiver is
15granted, the recipient must agree to a contractual
16modification, including recapture provisions, to the
17development assistance agreement. The existence of any waiver
18granted pursuant to this subsection (b), the date of the
19granting of such waiver, and a brief summary of the reasons
20supporting the granting of such waiver shall be disclosed
21consistent with the provisions of Section 25 of this Act.
22    (b-5) The Department shall post, on its website, (i) the
23identity of each recipient from whom amounts were recaptured
24under this Section on or after the effective date of this
25amendatory Act of the 97th General Assembly, (ii) the date of
26the recapture, (iii) a summary of the reasons supporting the



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1recapture, and (iv) the amount recaptured from those
3    (c) Beginning June 1, 2004, the Department shall annually
4compile a report on the outcomes and effectiveness of
5recapture provisions by program, including but not limited to:
6(i) the total number of companies that receive development
7assistance as defined in this Act; (ii) the total number of
8recipients in violation of development agreements with the
9Department; (iii) the total number of completed recapture
10efforts; (iv) the total number of recapture efforts initiated;
11and (v) the number of waivers granted. This report shall be
12disclosed consistent with the provisions of Section 20 of this
14    (d) For the purposes of this Act, recapture provisions do
15not include the Illinois Department of Transportation Economic
16Development Program, any grants under the Industrial Training
17Program that are not given as an incentive to a recipient
18business organization, or any successor programs as described
19in the term "development assistance" in Section 5 of this Act.
20(Source: P.A. 97-2, eff. 5-6-11; 97-721, eff. 6-29-12; 98-109,
21eff. 7-25-13; 98-463, eff. 8-16-13.)
22    Section 10. The Economic Development for a Growing Economy
23Tax Credit Act is amended by changing Section 5-55 as follows:
24    (35 ILCS 10/5-55)



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1    Sec. 5-55. Certificate of verification; submission to the
2Department of Revenue. A Taxpayer claiming a Credit under this
3Act shall submit to the Department of Revenue a copy of the
4Director's certificate of verification under this Act for the
5taxable year. However, failure to submit a copy of the
6certificate with the Taxpayer's tax return shall not
7invalidate a claim for a Credit.
8    For a Taxpayer to be eligible for a certificate of
9verification, the Taxpayer shall provide proof as required by
10the Department prior to the end of each calendar year,
11including, but not limited to, attestation by the Taxpayer
13        (1) The project has substantially achieved the level
14    of new full-time jobs specified in its Agreement.
15        (2) The project has substantially achieved the level
16    of annual payroll in Illinois specified in its Agreement.
17        (3) The project has substantially achieved the level
18    of capital investment in Illinois specified in its
19    Agreement.
20        (4) For taxable years that begin on or after January
21    1, 2020 and begin prior to January 1, 2022, the Department
22    shall not find a Taxpayer out of compliance with an
23    Agreement on the basis of a failure to maintain the job
24    creation or retention requirements of an Agreement so long
25    as the level of job creation or retention is maintained at
26    85% of the Agreement requirements during the modification



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1    period and the Taxpayer demonstrates to the Department, to
2    the Department's satisfaction, that the failure to
3    maintain the contractually required job creation and
4    retention levels is due to a direct and substantial
5    hardship caused by the COVID-19 pandemic. The Department
6    shall require proof of a direct and substantial hardship
7    caused by the COVID-19 pandemic; that determination shall
8    be left to the sole and absolute discretion of the
9    Department.
10(Source: P.A. 91-476, eff. 8-11-99.)
11    Section 99. Effective date. This Act takes effect upon
12becoming law.