Illinois General Assembly - Full Text of HB6224
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Full Text of HB6224  99th General Assembly

HB6224 99TH GENERAL ASSEMBLY

  
  

 


 
99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB6224

 

Introduced 2/11/2016, by Rep. Jay Hoffman

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 450/2-10

    Amends the Illinois Hydraulic Fracturing Tax Act. Changes the definition of "Illinois construction worker" to mean a construction worker domiciled in Illinois for 60 months (instead of 24 months) prior to the date of the issuance of a high volume horizontal hydraulic fracturing permit for the well site on which the construction is performed. Effective immediately.


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A BILL FOR

 

HB6224LRB099 19414 HLH 43806 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 Illinois Hydraulic Fracturing Tax Act is
5amended by changing Section 2-10 as follows:
 
6    (35 ILCS 450/2-10)
7    Sec. 2-10. Definitions. For the purposes of this Act,
8unless the context otherwise requires:
9    "Barrel" for oil measurement means a barrel of 42 U.S.
10gallons of 231 cubic inches per gallon, computed at a
11temperature of 60 degrees Fahrenheit.
12    "Construction" means any constructing, altering,
13reconstructing, repairing, rehabilitating, refinishing,
14refurbishing, remodeling, remediating, renovating, custom
15fabricating, maintaining, landscaping, improving, drilling,
16testing, moving, wrecking, painting, decorating, demolishing,
17and adding to or subtracting from any building, structure,
18highway, roadway, street, bridge, alley, sewer, ditch, water
19works, parking facility, railroad, excavation or other
20structure, project, development, real property or improvement,
21or to do any part thereof, whether or not the performance of
22the construction involves the addition to, or fabrication into,
23any structure, project, development, real property or

 

 

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1improvement herein described performed or done on behalf of an
2operator in connection with and at the location of a well site
3subject to the tax imposed by this Act.
4    "Construction worker" means a person performing
5construction.
6    "Department" means the Illinois Department of Revenue.
7    "Fracturing" or "hydraulic fracturing" means the
8propagation of fractures in a rock layer, by a pressurized
9fluid used to release petroleum or natural gas (including shale
10gas, tight gas, and coal seam gas), for extraction.
11    "Gas" means natural gas taken from below the surface of the
12earth or water in this State, regardless of whether the gas is
13taken from a gas well or from a well also productive of oil or
14any other product.
15    "General prevailing rate of hourly wages" has the meaning
16ascribed to it in Section 2 of the Prevailing Wage Act, as
17determined by the Director of the Department of Labor under
18Section 9 of the Prevailing Wage Act for the county in which
19the construction occurs.
20    "Illinois construction worker" means a construction
21worker, as defined in this Section, domiciled in Illinois for
2260 24 months prior to the date of the issuance of a high volume
23horizontal hydraulic fracturing permit for the well site on
24which the construction is performed.
25    "Lease number" means the number assigned by the purchaser
26to identify each production unit.

 

 

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1    "Oil" means petroleum or other crude oil, condensate,
2casinghead gasoline, or other mineral oil that is severed or
3withdrawn from below the surface of the soil or water in this
4State.
5    "Operator" means the person primarily responsible for the
6management and operation of oil or gas productions from a
7production unit.
8    "Person" means any natural individual, firm, partnership,
9association, joint stock company, joint adventure, public or
10private corporation, limited liability company, or a receiver,
11executor, trustee, guardian, or other representative appointed
12by order of any court.
13    "Producer" means any person owning, controlling, managing,
14or leasing any oil or gas property or oil or gas well, and any
15person who severs in any manner any oil or gas in this State,
16and shall include any person owning any direct and beneficial
17interest in any oil or gas produced, whether severed by such
18person or some other person on their behalf, either by lease,
19contract, or otherwise, including working interest owners,
20overriding royalty owners, or royalty owners.
21    "Production unit" means a unit of property designated by
22the Department of Natural Resources from which oil or gas is
23severed.
24    "Purchaser" means a person who is the first purchaser of a
25product after severance from a production unit.
26    "Remove" or "removal" means the physical transportation of

 

 

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1oil or gas off of the production unit where severed; and if the
2oil or gas is used on the premises where severed, or if the
3manufacture or conversion of oil or gas into refined products
4occurs on the premises where severed, oil or gas shall be
5deemed to have been removed on the date such use, manufacture,
6or conversion begins.
7    "Severed" or "severing" means: (1) the production of oil
8through extraction or withdrawal of the same, whether such
9extraction or withdrawal is by natural flow, mechanical flow,
10forced flow, pumping, or any other means employed to get the
11oil from below the surface of the soil or water and shall
12include the withdrawal by any means whatsoever of oil upon
13which the tax has not been paid, from any surface reservoir,
14natural or artificial, or from a water surface; and (2) the
15production of gas through the extraction or withdrawal of the
16same by any means whatsoever, from below the surface of the
17earth or water.
18    "Severance" means the taking of oil or gas from below the
19surface of the soil or water in any manner whatsoever.
20    "Total workforce hours" means all hours worked by
21construction workers on a well site, beginning on the date an
22application for a permit to perform high volume horizontal
23hydraulic fracturing operations at the well is filed under
24Section 1-35 of the Hydraulic Fracturing Regulatory Act and
25ending on the date of first production following initial
26drilling or any reworking of the well.

 

 

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1    "Value" means the sale price of oil or gas at the time of
2removal of the oil or gas from the production unit and if oil
3or gas is exchanged for something other than cash, or if no
4sale occurs at the time of removal, or if the Department
5determines that the relationship between the buyer and the
6seller is such that the consideration paid, if any, is not
7indicative of the true value or market price, then the
8Department shall determine the value of the oil or gas subject
9to tax based on the cash price paid to one or more producers
10for the oil or gas or based on the cash price paid to producers
11for like quality oil or gas in the vicinity of the production
12unit at the time of the removal of the oil or gas from the
13production unit.
14    "Well site" has the meaning ascribed to the term in Section
151-5 of the Hydraulic Fracturing Regulatory Act.
16    "Working interest" means any interest in or any right to
17the production of oil and gas, excluding royalty or overriding
18royalty interests.
19(Source: P.A. 98-22, eff. 6-17-13.)
 
20    Section 99. Effective date. This Act takes effect upon
21becoming law.