Illinois General Assembly - Full Text of HB3437
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Full Text of HB3437  102nd General Assembly

HB3437ham002 102ND GENERAL ASSEMBLY

Rep. Lawrence Walsh, Jr.

Filed: 4/20/2021

 

 


 

 


 
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1
AMENDMENT TO HOUSE BILL 3437

2    AMENDMENT NO. ______. Amend House Bill 3437, AS AMENDED,
3by replacing everything after the enacting clause with the
4following:
 
5
"ARTICLE 1. INVESTING IN ILLINOIS WORKS TAX CREDIT ACT

 
6    Section 1-1. Short title. This Article may be cited as the
7Investing in Illinois Works Tax Credit Act. References in this
8Article to "this Act" mean this Article.
 
9    Section 1-3. Legislative findings. The General Assembly
10finds that:
11    Economic research indicates that registered apprenticeship
12programs have positive economic impacts, and countries with
13more widespread usage of apprenticeship programs have shown to
14be more successful at transitioning young workers into stable
15jobs, resulting in lower youth unemployment rates.

 

 

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1    The demographics of registered apprenticeship programs in
2our State do not mirror the diversity of Illinoisans.
3According to data from the U.S. Department of Labor's Office
4of Apprenticeship, from 2000 through 2016, only 8.8% of all
5construction apprentices were African-American, 17.6% were
6Hispanic or Latino/Latina, while 69.6% were white.
7    In order to work toward a level playing field for all who
8seek the training and economic stability apprenticeships
9provide, Illinois created the Illinois Works Preapprenticeship
10Program, which funds preapprenticeship skills training through
11community-based organizations serving populations that have,
12historically, been met with barriers to entry or advancement
13in the workforce.
14    By targeting historically underutilized communities whose
15members seek to access the upward mobility and career
16advancement apprenticeships bring, the Illinois Works
17Preapprenticeship Program is one part of many State
18initiatives to increase diversity in apprenticeship programs
19and careers in the construction and building trades.
20    The Investing in Illinois Works Tax Credit expands the
21goals of the Illinois Works Preapprenticeship Program to
22private construction projects and highly skilled training
23programs by incentivizing contractors to utilize graduates of
24the Illinois Works Preapprenticeship Program or graduates of
25the U.S. Department of Labor's Office of Apprenticeship as
26part of their skilled and trained workforces on projects at

 

 

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1high-hazard facilities.
 
2    Section 1-5. Definitions. As used in this Act:
3    "Apprenticeship program" has the same meaning as provided
4in Section 10-5 of the Illinois Hazardous Materials Workforce
5Training Act.
6    "Department" means the Department of Commerce and Economic
7Opportunity.
8    "Illinois Works Preapprenticeship Program" means a network
9of community-based, nonprofit organizations throughout
10Illinois that receive grant funding from the Illinois
11Department of Commerce and Economic Opportunity to recruit,
12pre-screen, and provide preapprenticeship skill training to
13create a qualified, diverse pipeline of workers who are
14prepared for careers in the construction and building trades
15as prescribed in Section 20-15 Illinois Works Jobs Program
16Act.
17    "Inflation adjustment" means for any calendar year the
18percentage, if any, by which the Consumer Price Index for All
19Urban Consumers, as issued by the United States Department of
20Labor, for the preceding calendar year exceeds the Consumer
21Price Index for All Urban Consumers for calendar year 2021.
22    "Owner or operator" has the meaning provided in Section 5
23of the Illinois Hazardous Materials Workforce Training Act.
24    "Qualifying employee" means a qualifying graduate who was
25continuously employed by the owner or operator, or a

 

 

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1contractor employed by the owner or operator, in Illinois
2during all 4 reporting periods occurring in the calendar year
3directly preceding the calendar year in which the credit is
4claimed.
5    "Qualifying graduate" means an individual from an
6underrepresented population who has successfully completed a
7preapprenticeship program through the Illinois Works
8Preapprenticeship Program in compliance with the requirements
9of Section 20-15 of the Illinois Works Jobs Programs Act and
10who is a registered apprentice as defined under Section 10-5
11of the Illinois Hazardous Materials Workforce Training Act or
12has successfully completed an apprenticeship program approved
13by and registered with the United States Department of Labor's
14Office of Apprenticeship.
15    "Reporting period" means the quarter for which a return is
16required to be filed under subsection (b) of Section 704A of
17the Illinois Income Tax Act.
18    "Skilled and trained workforce" has the same meaning
19provided in Section 10-5 of the Illinois Hazardous Materials
20Workforce Training Act.
21    "Tax credit certificate" means the certificate awarded by
22the Department pursuant to Section 1-20 of this Act.
23    "Underrepresented population" has the meaning provided in
24Section 20-10 of the Illinois Works Job Program Act.
 
25    Section 1-10. Credit amount. For reporting periods

 

 

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1beginning on or after January 1, 2022, subject to the
2limitations provided in this Act, an owner or operator may
3claim as a credit against the tax imposed under Section 704A of
4the Illinois Income Tax Act an amount equal to $2,500 for each
5qualifying employee, plus any applicable inflation adjustment,
6as certified by the Department on a tax credit certificate
7awarded pursuant to this Act.
 
8    Section 1-15. Application process.
9    (a) An owner or operator may apply to the Department for a
10certificate to receive a credit under Section 1-10.
11    (b) The Department shall establish an application process
12to certify an owner or operator for the credit under Section
131-10 as necessary for implementation of this Act. As part of
14the application process, the Department shall require the
15owner or operator to provide:
16        (1) the name, year, and community-based organization
17    or union through which each qualifying employee completed
18    his or her Illinois Works Preapprenticeship Program or
19    apprenticeship program;
20        (2) the certificate of completion from the Department
21    of Labor that the qualifying employee has completed the
22    minimum approved safety training required by the Illinois
23    Hazardous Materials Workforce Training Act;
24        (3) the hours worked by the qualifying employee that
25    go to meeting his or her apprenticeship requirements at

 

 

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1    the time of the application;
2        (4) a signed affidavit from the owner or operator
3    attesting that: (i) the qualifying employee was employed
4    by the owner and operator or a contractor reemployed by
5    the owner or operator during all 4 reporting periods
6    occurring during the calendar year preceding the calendar
7    year in which the credit will be applied; (ii) the
8    qualifying employee performed work in his or her
9    prevailing wage classification for the duration of his or
10    her employment in the calendar year preceding the calendar
11    year in which the credit will be applied; (iii) the
12    documents provided in the application are true; and (iv)
13    the owner or operator will comply with all applicable
14    laws; and
15        (5) any other material required by the Department.
 
16    Section 1-20. Credit awards.
17    (a) Upon satisfactory review, the Department shall issue a
18tax credit certificate stating the amount of the tax credit to
19which an owner or operator is entitled under this Act. Each
20certificate shall include a unique identifying number. The
21credit shall be claimed for the first reporting period
22beginning on or after the date on which the certificate is
23issued by the Department. The credit shall be equal to the
24amount shown on the certificate but may not reduce the
25taxpayer's obligation for any payment due under Section 704A

 

 

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1of the Illinois Income Tax Act to less than zero. If the amount
2of the credit exceeds the total payments due under this
3Section with respect to amounts withheld during the reporting
4period, the excess may be carried forward and applied against
5the taxpayer's liability under Section 704A of the Illinois
6Income Tax Act in the 5 succeeding calendar years. The credit
7shall be applied to the earliest reporting period for which
8there is a tax liability. If there are credits from more than
9one reporting period that are available to offset a liability,
10the earlier credit shall be applied first. No credit awarded
11under this Act shall be sold or otherwise transferred.
12    (b) This Section is exempt from the provisions of Section
13250 of the Illinois Income Tax Act.
14    (c) The Department shall award not more than an aggregate
15of $20,000,000 in total annual tax credits pursuant to this
16Act, increased annually by any applicable inflation
17adjustment. If applications for a greater amount are received,
18credits shall be allowed on a first-come, first-served basis
19based on the date on which each properly completed application
20for certification is received by the Department. If more than
21one properly completed application for certification is
22received on the same day, the credits shall be awarded based on
23the time of submission for that particular day.
 
24    Section 1-25. Penalties; recapture.
25    (a) False or fraudulent claims for credits under this Act

 

 

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1may be subject to penalties as provided under Sections 3-5 or
23-6 of the Uniform Penalty and Interest Act, as applicable.
3    (b) If the Department determines that an owner or operator
4who has received a credit under this Act does not comply with
5the requirements of this Act or that a certification the owner
6or operator made in his or her application are false, the
7Department may initiate recapture procedures against the owner
8or operator and, after notice and an opportunity for hearing,
9recapture the entire credit amount awarded pursuant to any tax
10credit certificate under issued under this Act. The Department
11shall notify the Department of Revenue of any credits
12recaptured pursuant to this subsection.
13    (c) If a previously awarded credit is required to be
14recaptured under subsection (b), the owner or operator shall
15increase the next withholding payment required under Section
16704A of the Illinois Income Tax Act by the amount of the
17recaptured credit.
 
18    Section 1-30. Rulemaking. The Department shall adopt rules
19for the implementation and administration of this Act. In
20order to provide for the expeditious and timely implementation
21of this Act, the Department, the Department of Labor, and the
22Department of Revenue may adopt emergency rules. The adoption
23of emergency rules authorized by this Section is deemed to be
24necessary for the public interest, safety, and welfare.
 

 

 

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1
ARTICLE 5. ACCESS TO APPRENTICESHIP ACT

 
2    Section 5-1. Short title. This Article may be cited as the
3Access to Apprenticeship Act. References in this Article to
4"this Act" mean this Article.
 
5    Section 5-5. Restrictions on application requirements.
6Notwithstanding any law to the contrary, in order to ensure
7fair and equal access to apprenticeship programs, no
8application for a preapprenticeship or apprenticeship program,
9whether run by the State, a community-based organization, a
10community college, a public university, a private employer, a
11union, or joint labor-management program, may require a
12recommendation from a union member or any other person as a
13condition of acceptance to the preapprenticeship or
14apprenticeship program. An intent to hire letter from a
15signatory contractor shall not be considered a recommendation
16for purposes of this Act.
 
17    Section 5-97. Severability. The provisions of this Act are
18severable under Section 1.31 of the Statute on Statutes.
 
19
ARTICLE 10. ILLINOIS HAZARDOUS MATERIALS WORKFORCE TRAINING
20
ACT

 
21    Section 10-1. Short title. This Article may be cited as

 

 

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1the Illinois Hazardous Materials Workforce Training Act.
2References in this Article to "this Act" mean this Article.
 
3    Section 10-5. Definitions. As used in this Act:
4    "Apprenticeable occupation" means an occupation in the
5building and construction trades for which training and
6apprenticeship programs have been approved by and registered
7with the U.S. Department of Labor's Office of Apprenticeship.
8    "Apprenticeship program" means an applicable training and
9apprenticeship program approved by and registered with the
10U.S. Department of Labor's Office of Apprenticeship.
11    "Building and construction trades council" means any labor
12organization that represents multiple construction trades and
13monitors or is attentive to compliance with public or workers'
14safety laws, wage and hour requirements, or other statutory
15requirements and negotiates and maintains collective
16bargaining agreements.
17    "Construction" means all work at a stationary source
18involving laborers, workers, or mechanics, including any
19maintenance, repair, assembly, or disassembly work performed
20on equipment whether owned, leased, or rented.
21    "Department" means the Department of Labor.
22    "Director" means the Director of Labor.
23    "Labor agreement" means a form of prehire collective
24bargaining agreement covering all terms and conditions of
25employment.

 

 

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1    "Labor organization" means an organization that is the
2exclusive representative of an employer's employees recognized
3or certified under the federal National Labor Relations Act of
41935.
5    "Minimum approved safety training for workers at high
6hazard facilities" means a minimum 30-hour OSHA Outreach
7Training Program for the Construction class consisting of a
8curriculum of OSHA-designated training topics with training
9performed by an authorized OSHA Outreach Training Program
10Trainer and that is intended to provide workers with
11information about their rights, employer responsibilities,
12safety and health hazards a worker may encounter on a work
13site, as well as how to identify, abate, avoid, and prevent
14job-related hazards by emphasizing hazard identification,
15avoidance, control, and prevention.
16    "OSHA" means the United States Department of Labor's
17Occupational Safety and Health Administration.
18    "Owner or operator" means an owner or operator of a
19stationary source that is engaged in activities described in
20Code 324110, 325110, 325193, or 325199 of the 2017 North
21American Industry Classification System (NAICS), and has one
22or more covered processes that are required to prepare and
23submit a Risk Management Plan. "Owner or operator" does not
24include oil and gas extraction operations.
25    "Prevailing hourly wage rate" has the same meaning as
26"general prevailing rate of hourly wages" as defined in

 

 

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1Section 2 of the Prevailing Wage Act.
2    "Registered apprentice" means an apprentice registered in
3an applicable apprenticeship program for an apprenticeable
4occupation approved by and registered with the U.S. Department
5of Labor's Office of Apprenticeship.
6    "Shift" means a set standard period of time an employer
7requires its employees to perform his or her work-related
8duties on a daily basis. For purposes of this definition,
9there may be multiple shifts per day.
10    "Skilled journeyperson" means a worker who meets all of
11the following criteria:
12        (1) the worker either graduated from an approved
13    apprenticeship and training program approved by and
14    registered with the U.S. Department of Labor's Office of
15    Apprenticeship for the applicable occupation, or has at
16    least as many hours of on-the-job experience in the
17    applicable occupation that would be required to graduate
18    from an apprenticeship program approved by and registered
19    with the U.S. Department of Labor's Office of
20    Apprenticeship for the applicable occupation;
21        (2) the worker is being paid at least a rate
22    equivalent to the prevailing hourly wage rate for a
23    journeyperson in the applicable occupation and locality;
24    and
25        (3) beginning on or after July 1, 2024, the worker has
26    completed, within the prior 3 calendar years, minimum

 

 

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1    approved safety training for workers at high hazard
2    facilities and has filed a certificate of completion with
3    the Department.
4    "Skilled and trained workforce" means a workforce that
5meets all of the following criteria:
6        (1) all the workers are either registered apprentices
7    or skilled journeypersons;
8        (2) beginning on July 1, 2022, at least 45% of the
9    skilled journeypersons are graduates of an apprenticeship
10    program for the applicable occupation;
11        (3) beginning on July 1, 2023, at least 60% of the
12    skilled journeypersons are graduates of an apprenticeship
13    program for the applicable occupation; and
14        (4) beginning on July 1, 2024, at least 80% of the
15    skilled journeypersons are graduates of an apprenticeship
16    program for the applicable occupation.
17    "Stationary source" means that term as it is defined under
18Section 39.5 of the Environmental Protection Act.
 
19    Section 10-10. Minimum approved safety training.
20    (a) A person who has completed minimum approved safety
21training for workers at high hazard facilities shall file his
22or her certificate of completion with the Department in a
23manner prescribed by the Department.
24    (b) The owner or operator, when contracting for the
25performance of construction work at the stationary source,

 

 

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1shall require that its contractors and any subcontractors use
2a skilled and trained workforce to perform all onsite work
3within an apprenticeable occupation in the building and
4construction trades.
5    (c) The requirements of this Section shall not immediately
6apply to contracts awarded before July 1, 2022, unless the
7contract is extended or renewed after that date. Contracts
8awarded before July 1, 2022 shall meet the requirements of
9this Section no later than July 1, 2023.
10    (d) The requirements of this Section shall only apply to
11the skilled and trained workforce, contracted with an owner or
12operator to perform construction work at the stationary source
13site.
14    (e) The skilled and trained workforce requirements under
15this Section shall not apply to:
16        (1) Contractors that have requested qualified workers
17    from the local hiring halls that dispatch workers in the
18    apprenticeable occupation and, due to workforce shortages,
19    the contractor is unable to obtain sufficient qualified
20    workers within 48 hours of the request, Saturdays,
21    Sundays, and holidays excepted. This Act shall not prevent
22    contractors from obtaining workers from any source.
23        (2) An emergency where compliance is impracticable;
24    namely, an emergency requires immediate action to prevent
25    imminent harm to public health or safety or to the
26    environment. Within 14 days of an emergency, the Illinois

 

 

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1    Department of Labor must certify that the emergency
2    warranted noncompliance with this Act. The employer must
3    provide necessary documentation of the emergency to the
4    Illinois Department of Labor.
 
5    Section 10-15. Enforcement. Any interested party may file
6a complaint with the Department of Labor against an owner,
7operator, or construction contractor covered under this Act if
8there is reasonable belief that the owner, operator, or
9construction contractor is in violation of this Act. Upon
10receiving the complaint, the Department of Labor shall request
11a copy of any contract at issue that was entered into between
12the owner, operator, or construction contractor to ensure that
13training requirements under this Act were included in the
14contract's terms. The Department of Labor shall request from
15the construction contractor a copy of the construction
16contractor's payroll, broken down by any registered apprentice
17and skilled journeyperson on the job site. If the Department
18of Labor finds that an owner, operator, or construction
19contractor has not complied with this Act, the Department
20shall refer the matter to the Attorney General for
21enforcement.
 
22    Section 10-20. Exemptions. This Act does not apply to any
23owner or operator that has an executed national or local labor
24agreement in effect pertaining to the performance of

 

 

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1construction work at a given facility or site under the terms
2of the agreement. The labor agreement must be negotiated with
3and approved by a local building and construction trades
4council that has geographic jurisdiction over the stationary
5source.
 
6    Section 10-21. Reporting.
7    (a) Any applicable apprenticeship and training program
8approved by and registered with the U.S. Department of Labor's
9Office of Apprenticeship providing minimum approved safety
10training for workers in high hazard facilities and any
11contractor who employs workers operating at high hazard
12facilities shall file an annual report with the Department and
13the Illinois Works Review Panel, in the form and manner
14required by the Department, within 6 months after the
15effective date of this Act and on January 31 of each year
16thereafter. The report shall contain the following
17information:
18        (1) A description of the applicable apprenticeship and
19    training program, approved by and registered with the U.S.
20    Department of Labor's Office of Apprenticeship, or the
21    contractor's recruitment efforts, screening efforts, and a
22    general description of training efforts.
23        (2) The applicable apprenticeship and training
24    program, approved by and registered with the U.S.
25    Department of Labor's Office of Apprenticeship, shall

 

 

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1    provide the number of individuals who apply to,
2    participate in, and complete the minimum approved safety
3    training for workers at high hazard facilities, broken
4    down by race, gender, jurisdiction, age, and veteran
5    status. A contractor under this paragraph shall provide
6    the number of workers who the contractor employs to work
7    at high hazard facilities, within the last calendar year,
8    broken down by race, gender, jurisdiction, age, and
9    veteran status.
10        (3) The demographic data of the jurisdiction.
11        (4) For the applicable apprenticeship and training
12    program, approved by and registered with the U.S.
13    Department of Labor's Office of Apprenticeship, a
14    statement of the minimum diversity goal that participation
15    in the minimum approved safety training for workers in
16    high hazard facilities is equal to the demographics of its
17    jurisdiction. For a contractor under this paragraph, a
18    statement of the minimum diversity goal that the workers
19    employed by the contractor to work at high hazard
20    facilities are equal to of the demographics of the
21    contractor's jurisdiction.
22        (5) An action plan to increase diversity and meet or
23    exceed the stated minimum diversity goal, inclusive of,
24    but not limited to, the following actions if the diversity
25    goal is not met:
26            (A) Providing information on this Act for all high

 

 

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1        schools and field offices of the Department of
2        Employment Security in the jurisdiction.
3            (B) Entering into a joint agreement with the
4        Department of Employment Security for outreach and
5        employment.
6            (C) Entering into a joint agreement with
7        educational institutions or approved Illinois Works
8        Preapprenticeship Programs established under
9        subsection (a) of Section 20-15 of the Illinois Works
10        Jobs Program Act in the jurisdiction to enhance
11        recruitment efforts.
12            (D) Eliminating experience requirements, when
13        feasible, to permit increased participation by
14        minorities.
15    (b) If the Department and the Illinois Works Review Panel
16conclude that the report submitted under this Section does not
17meet or is unlikely to meet the minimum diversity goal under
18paragraph (4) of subsection (a) within 12 months after filing
19its report, or that the action plan was not followed, the
20Department and the Illinois Works Review Panel shall recommend
21that the action plan be revised to provide additional steps
22and opportunities for minority participation.
23    (c) An applicable apprenticeship and training program,
24approved by and registered with the U.S. Department of Labor's
25Office of Apprenticeship, providing workers in a high hazard
26facility or a contractor operating at high hazard facility

 

 

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1shall be deemed unfit to provide workers or operate at high
2hazard facilities and may be subject to a penalty of up to one
3year's prohibition from providing workers or operating at high
4hazard facilities. If the Department and the Illinois Works
5Review Panel conclude that the applicable apprenticeship and
6training program, approved by and registered with the U.S.
7Department of Labor's Office of Apprenticeship, providing
8workers in a high hazard facility or the contractor operating
9at a high hazard facility failed to follow its action plan
10under paragraph (5) of subsection (a) or the recommendations
11to its action plan provided by the Department and the Illinois
12Works Review Panel under subsection (b) within 12 months after
13filing the entity's report, then the applicable apprenticeship
14and training program or contractor shall be deemed unfit to
15provide workers or operate at high hazard facilities and may
16be subject to a penalty of up to one year's prohibition from
17providing workers or operating at high hazard facilities.
18    (d) For reporting purposes, the jurisdiction is the
19Illinois county where the applicable apprenticeship and
20training program, approved by and registered with the U.S.
21Department of Labor's Office of Apprenticeship, is located.
22For a contractor, the jurisdiction is the county where the
23contractor's workers perform the majority of work in a high
24hazard facility within the last calendar year.
 
25    Section 10-25. Penalties; noncompliant reporting;

 

 

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1reinstatement.
2    (a) Except as provided in subsection (b), an owner or
3operator who violates the requirements of this Act shall be
4subject to a minimum civil penalty of $10,000 for each
5violation. Each shift a violation of this Act occurs shall be
6considered a separate violation. The penalty may be recovered
7in a civil action brought by the Director in any circuit court.
8In the civil action, the Director shall be represented by the
9Attorney General. All moneys received by the Department as
10fees and civil penalties under this Act shall be deposited
11into the Illinois Works Fund to be used to recruit, prescreen,
12and provide preapprenticeship skills training for which
13participants may attend free of charge and receive a stipend
14to create a qualified, diverse pipeline of workers who are
15prepared to work in high hazard facilities.
16    (b) Notwithstanding subsection (a), if the Department and
17the Illinois Works Review Panel determine that there is a
18violation of Section 10-21, the Department and the Illinois
19Works Review Panel shall provide reasonable notice of
20noncompliance to the violator within 90 days after the
21violation and inform the violator that the violator has 45
22days to comply with Section 10-21 without penalty. If the
23noncompliance is not remedied, the violator may be deemed
24unfit to provide workers or operate at high hazard facilities
25for a period of up to one year. If the Department and the
26Illinois Works Review Panel determine that the violator has

 

 

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1remedied the violation and is in compliance with Section
210-21, the Department shall have 45 days to reinstate the
3authorization for the violator to provide workers or operate
4at high hazard facilities. The Department and the Illinois
5Works Review Panel may not unreasonably withhold reinstatement
6under this subsection when the applicable apprenticeship and
7training program, approved by and registered with the U.S.
8Department of Labor's Office of Apprenticeship, providing
9workers in high hazard facilities or the contractor operating
10at high hazard facilities is found to be in compliance with
11Section 10-21.
 
12    Section 10-97. Severability. The provisions of this Act
13are severable under Section 1.31 of the Statute on Statutes.
 
14
ARTICLE 15. AMENDATORY PROVISIONS

 
15    Section 15-5. The Illinois Administrative Procedure Act is
16amended by adding Section 5-45.8 as follows:
 
17    (5 ILCS 100/5-45.8 new)
18    Sec. 5-45.8. Emergency rulemaking. To provide for the
19expeditious and timely implementation of this amendatory Act
20of the 102nd General Assembly, the Department of Commerce and
21Economic Opportunity shall, and the Department of Labor and
22the Department of Revenue may, adopt emergency rules. The

 

 

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1adoption of emergency rules authorized by this Section is
2deemed to be necessary for the public interest, safety, and
3welfare.
4    This Section is repealed on January 1, 2026.
 
5    Section 15-10. The Illinois Income Tax Act is amended by
6changing Section 704A as follows:
 
7    (35 ILCS 5/704A)
8    Sec. 704A. Employer's return and payment of tax withheld.
9    (a) In general, every employer who deducts and withholds
10or is required to deduct and withhold tax under this Act on or
11after January 1, 2008 shall make those payments and returns as
12provided in this Section.
13    (b) Returns. Every employer shall, in the form and manner
14required by the Department, make returns with respect to taxes
15withheld or required to be withheld under this Article 7 for
16each quarter beginning on or after January 1, 2008, on or
17before the last day of the first month following the close of
18that quarter.
19    (c) Payments. With respect to amounts withheld or required
20to be withheld on or after January 1, 2008:
21        (1) Semi-weekly payments. For each calendar year, each
22    employer who withheld or was required to withhold more
23    than $12,000 during the one-year period ending on June 30
24    of the immediately preceding calendar year, payment must

 

 

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1    be made:
2            (A) on or before each Friday of the calendar year,
3        for taxes withheld or required to be withheld on the
4        immediately preceding Saturday, Sunday, Monday, or
5        Tuesday;
6            (B) on or before each Wednesday of the calendar
7        year, for taxes withheld or required to be withheld on
8        the immediately preceding Wednesday, Thursday, or
9        Friday.
10        Beginning with calendar year 2011, payments made under
11    this paragraph (1) of subsection (c) must be made by
12    electronic funds transfer.
13        (2) Semi-weekly payments. Any employer who withholds
14    or is required to withhold more than $12,000 in any
15    quarter of a calendar year is required to make payments on
16    the dates set forth under item (1) of this subsection (c)
17    for each remaining quarter of that calendar year and for
18    the subsequent calendar year.
19        (3) Monthly payments. Each employer, other than an
20    employer described in items (1) or (2) of this subsection,
21    shall pay to the Department, on or before the 15th day of
22    each month the taxes withheld or required to be withheld
23    during the immediately preceding month.
24        (4) Payments with returns. Each employer shall pay to
25    the Department, on or before the due date for each return
26    required to be filed under this Section, any tax withheld

 

 

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1    or required to be withheld during the period for which the
2    return is due and not previously paid to the Department.
3    (d) Regulatory authority. The Department may, by rule:
4        (1) Permit employers, in lieu of the requirements of
5    subsections (b) and (c), to file annual returns due on or
6    before January 31 of the year for taxes withheld or
7    required to be withheld during the previous calendar year
8    and, if the aggregate amounts required to be withheld by
9    the employer under this Article 7 (other than amounts
10    required to be withheld under Section 709.5) do not exceed
11    $1,000 for the previous calendar year, to pay the taxes
12    required to be shown on each such return no later than the
13    due date for such return.
14        (2) Provide that any payment required to be made under
15    subsection (c)(1) or (c)(2) is deemed to be timely to the
16    extent paid by electronic funds transfer on or before the
17    due date for deposit of federal income taxes withheld
18    from, or federal employment taxes due with respect to, the
19    wages from which the Illinois taxes were withheld.
20        (3) Designate one or more depositories to which
21    payment of taxes required to be withheld under this
22    Article 7 must be paid by some or all employers.
23        (4) Increase the threshold dollar amounts at which
24    employers are required to make semi-weekly payments under
25    subsection (c)(1) or (c)(2).
26    (e) Annual return and payment. Every employer who deducts

 

 

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1and withholds or is required to deduct and withhold tax from a
2person engaged in domestic service employment, as that term is
3defined in Section 3510 of the Internal Revenue Code, may
4comply with the requirements of this Section with respect to
5such employees by filing an annual return and paying the taxes
6required to be deducted and withheld on or before the 15th day
7of the fourth month following the close of the employer's
8taxable year. The Department may allow the employer's return
9to be submitted with the employer's individual income tax
10return or to be submitted with a return due from the employer
11under Section 1400.2 of the Unemployment Insurance Act.
12    (f) Magnetic media and electronic filing. With respect to
13taxes withheld in calendar years prior to 2017, any W-2 Form
14that, under the Internal Revenue Code and regulations
15promulgated thereunder, is required to be submitted to the
16Internal Revenue Service on magnetic media or electronically
17must also be submitted to the Department on magnetic media or
18electronically for Illinois purposes, if required by the
19Department.
20    With respect to taxes withheld in 2017 and subsequent
21calendar years, the Department may, by rule, require that any
22return (including any amended return) under this Section and
23any W-2 Form that is required to be submitted to the Department
24must be submitted on magnetic media or electronically.
25    The due date for submitting W-2 Forms shall be as
26prescribed by the Department by rule.

 

 

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1    (g) For amounts deducted or withheld after December 31,
22009, a taxpayer who makes an election under subsection (f) of
3Section 5-15 of the Economic Development for a Growing Economy
4Tax Credit Act for a taxable year shall be allowed a credit
5against payments due under this Section for amounts withheld
6during the first calendar year beginning after the end of that
7taxable year equal to the amount of the credit for the
8incremental income tax attributable to full-time employees of
9the taxpayer awarded to the taxpayer by the Department of
10Commerce and Economic Opportunity under the Economic
11Development for a Growing Economy Tax Credit Act for the
12taxable year and credits not previously claimed and allowed to
13be carried forward under Section 211(4) of this Act as
14provided in subsection (f) of Section 5-15 of the Economic
15Development for a Growing Economy Tax Credit Act. The credit
16or credits may not reduce the taxpayer's obligation for any
17payment due under this Section to less than zero. If the amount
18of the credit or credits exceeds the total payments due under
19this Section with respect to amounts withheld during the
20calendar year, the excess may be carried forward and applied
21against the taxpayer's liability under this Section in the
22succeeding calendar years as allowed to be carried forward
23under paragraph (4) of Section 211 of this Act. The credit or
24credits shall be applied to the earliest year for which there
25is a tax liability. If there are credits from more than one
26taxable year that are available to offset a liability, the

 

 

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1earlier credit shall be applied first. Each employer who
2deducts and withholds or is required to deduct and withhold
3tax under this Act and who retains income tax withholdings
4under subsection (f) of Section 5-15 of the Economic
5Development for a Growing Economy Tax Credit Act must make a
6return with respect to such taxes and retained amounts in the
7form and manner that the Department, by rule, requires and pay
8to the Department or to a depositary designated by the
9Department those withheld taxes not retained by the taxpayer.
10For purposes of this subsection (g), the term taxpayer shall
11include taxpayer and members of the taxpayer's unitary
12business group as defined under paragraph (27) of subsection
13(a) of Section 1501 of this Act. This Section is exempt from
14the provisions of Section 250 of this Act. No credit awarded
15under the Economic Development for a Growing Economy Tax
16Credit Act for agreements entered into on or after January 1,
172015 may be credited against payments due under this Section.
18    (h) An employer may claim a credit against payments due
19under this Section for amounts withheld during the first
20calendar year ending after the date on which a tax credit
21certificate was issued under Section 35 of the Small Business
22Job Creation Tax Credit Act. The credit shall be equal to the
23amount shown on the certificate, but may not reduce the
24taxpayer's obligation for any payment due under this Section
25to less than zero. If the amount of the credit exceeds the
26total payments due under this Section with respect to amounts

 

 

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1withheld during the calendar year, the excess may be carried
2forward and applied against the taxpayer's liability under
3this Section in the 5 succeeding calendar years. The credit
4shall be applied to the earliest year for which there is a tax
5liability. If there are credits from more than one calendar
6year that are available to offset a liability, the earlier
7credit shall be applied first. This Section is exempt from the
8provisions of Section 250 of this Act.
9    (i) Each employer with 50 or fewer full-time equivalent
10employees during the reporting period may claim a credit
11against the payments due under this Section for each qualified
12employee in an amount equal to the maximum credit allowable.
13The credit may be taken against payments due for reporting
14periods that begin on or after January 1, 2020, and end on or
15before December 31, 2027. An employer may not claim a credit
16for an employee who has worked fewer than 90 consecutive days
17immediately preceding the reporting period; however, such
18credits may accrue during that 90-day period and be claimed
19against payments under this Section for future reporting
20periods after the employee has worked for the employer at
21least 90 consecutive days. In no event may the credit exceed
22the employer's liability for the reporting period. Each
23employer who deducts and withholds or is required to deduct
24and withhold tax under this Act and who retains income tax
25withholdings under this subsection must make a return with
26respect to such taxes and retained amounts in the form and

 

 

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1manner that the Department, by rule, requires and pay to the
2Department or to a depositary designated by the Department
3those withheld taxes not retained by the employer.
4    For each reporting period, the employer may not claim a
5credit or credits for more employees than the number of
6employees making less than the minimum or reduced wage for the
7current calendar year during the last reporting period of the
8preceding calendar year. Notwithstanding any other provision
9of this subsection, an employer shall not be eligible for
10credits for a reporting period unless the average wage paid by
11the employer per employee for all employees making less than
12$55,000 during the reporting period is greater than the
13average wage paid by the employer per employee for all
14employees making less than $55,000 during the same reporting
15period of the prior calendar year.
16    For purposes of this subsection (i):
17    "Compensation paid in Illinois" has the meaning ascribed
18to that term under Section 304(a)(2)(B) of this Act.
19    "Employer" and "employee" have the meaning ascribed to
20those terms in the Minimum Wage Law, except that "employee"
21also includes employees who work for an employer with fewer
22than 4 employees. Employers that operate more than one
23establishment pursuant to a franchise agreement or that
24constitute members of a unitary business group shall aggregate
25their employees for purposes of determining eligibility for
26the credit.

 

 

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1    "Full-time equivalent employees" means the ratio of the
2number of paid hours during the reporting period and the
3number of working hours in that period.
4    "Maximum credit" means the percentage listed below of the
5difference between the amount of compensation paid in Illinois
6to employees who are paid not more than the required minimum
7wage reduced by the amount of compensation paid in Illinois to
8employees who were paid less than the current required minimum
9wage during the reporting period prior to each increase in the
10required minimum wage on January 1. If an employer pays an
11employee more than the required minimum wage and that employee
12previously earned less than the required minimum wage, the
13employer may include the portion that does not exceed the
14required minimum wage as compensation paid in Illinois to
15employees who are paid not more than the required minimum
16wage.
17        (1) 25% for reporting periods beginning on or after
18    January 1, 2020 and ending on or before December 31, 2020;
19        (2) 21% for reporting periods beginning on or after
20    January 1, 2021 and ending on or before December 31, 2021;
21        (3) 17% for reporting periods beginning on or after
22    January 1, 2022 and ending on or before December 31, 2022;
23        (4) 13% for reporting periods beginning on or after
24    January 1, 2023 and ending on or before December 31, 2023;
25        (5) 9% for reporting periods beginning on or after
26    January 1, 2024 and ending on or before December 31, 2024;

 

 

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1        (6) 5% for reporting periods beginning on or after
2    January 1, 2025 and ending on or before December 31, 2025.
3    The amount computed under this subsection may continue to
4be claimed for reporting periods beginning on or after January
51, 2026 and:
6        (A) ending on or before December 31, 2026 for
7    employers with more than 5 employees; or
8        (B) ending on or before December 31, 2027 for
9    employers with no more than 5 employees.
10    "Qualified employee" means an employee who is paid not
11more than the required minimum wage and has an average wage
12paid per hour by the employer during the reporting period
13equal to or greater than his or her average wage paid per hour
14by the employer during each reporting period for the
15immediately preceding 12 months. A new qualified employee is
16deemed to have earned the required minimum wage in the
17preceding reporting period.
18    "Reporting period" means the quarter for which a return is
19required to be filed under subsection (b) of this Section.
20    (j) An employer may claim a credit against payments due
21under this Section for amounts withheld during the first
22reporting period beginning after the date on which a tax
23credit certificate was issued under the Investing in Illinois
24Works Tax Credit Act. The credit shall be equal to the amount
25shown on the certificate but may not reduce the taxpayer's
26obligation for any payment due under this Section to less than

 

 

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1zero. If the amount of the credit exceeds the total payments
2due under this Section with respect to amounts withheld during
3the reporting period, the excess may be carried forward and
4applied against the taxpayer's liability under this Section in
5the 5 succeeding calendar years. The credit shall be applied
6to the earliest reporting period for which there is a tax
7liability. If there are credits from more than one reporting
8period that are available to offset a liability, the earlier
9credit shall be applied first. This Section is exempt from the
10provisions of Section 250 of this Act.
11(Source: P.A. 100-303, eff. 8-24-17; 100-511, eff. 9-18-17;
12100-863, eff. 8-14-18; 101-1, eff. 2-19-19.)
 
13
ARTICLE 99. EFFECTIVE DATE

 
14    Section 99-99. Effective date. This Act takes effect
15January 1, 2022.".