SB0509sam001 103RD GENERAL ASSEMBLY

Sen. Don Harmon

Filed: 11/1/2023

 

 


 

 


 
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1
AMENDMENT TO SENATE BILL 509

2    AMENDMENT NO. ______. Amend Senate Bill 509 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Innovation Development and Economy Act is
5amended by changing Sections 10 and 20 as follows:
 
6    (50 ILCS 470/10)
7    Sec. 10. Definitions. As used in this Act, the following
8words and phrases shall have the following meanings unless a
9different meaning clearly appears from the context:
10    "Base year" means the calendar year immediately prior to
11the calendar year in which the STAR bond district is
12established.
13    "Commence work" means the manifest commencement of actual
14operations on the development site, such as, erecting a
15building, general on-site and off-site grading and utility
16installations, commencing design and construction

 

 

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1documentation, ordering lead-time materials, excavating the
2ground to lay a foundation or a basement, or work of like
3description which a reasonable person would recognize as being
4done with the intention and purpose to continue work until the
5project is completed.
6    "County" means the county in which a proposed STAR bond
7district is located.
8    "De minimis" means an amount less than 15% of the land area
9within a STAR bond district.
10    "Department of Revenue" means the Department of Revenue of
11the State of Illinois.
12    "Destination user" means an owner, operator, licensee,
13co-developer, subdeveloper, or tenant (i) that operates a
14business within a STAR bond district that is a retail store
15having at least 150,000 square feet of sales floor area; (ii)
16that at the time of opening does not have another Illinois
17location within a 70 mile radius; (iii) that has an annual
18average of not less than 30% of customers who travel from at
19least 75 miles away or from out-of-state, as demonstrated by
20data from a comparable existing store or stores, or, if there
21is no comparable existing store, as demonstrated by an
22economic analysis that shows that the proposed retailer will
23have an annual average of not less than 30% of customers who
24travel from at least 75 miles away or from out-of-state; and
25(iv) that makes an initial capital investment, including
26project costs and other direct costs, of not less than

 

 

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1$30,000,000 for such retail store.
2    "Destination hotel" means a hotel (as that term is defined
3in Section 2 of the Hotel Operators' Occupation Tax Act)
4complex having at least 150 guest rooms and which also
5includes a venue for entertainment attractions, rides, or
6other activities oriented toward the entertainment and
7amusement of its guests and other patrons.
8    "Developer" means any individual, corporation, trust,
9estate, partnership, limited liability partnership, limited
10liability company, or other entity. The term does not include
11a not-for-profit entity, political subdivision, or other
12agency or instrumentality of the State.
13    "Director" means the Director of Revenue, who shall
14consult with the Director of Commerce and Economic Opportunity
15in any approvals or decisions required by the Director under
16this Act.
17    "Economic impact study" means a study conducted by an
18independent economist to project the financial benefit of the
19proposed STAR bond project to the local, regional, and State
20economies, consider the proposed adverse impacts on similar
21projects and businesses, as well as municipalities within the
22projected market area, and draw conclusions about the net
23effect of the proposed STAR bond project on the local,
24regional, and State economies. A copy of the economic impact
25study shall be provided to the Director for review.
26    "Eligible area" means any improved or vacant area that (i)

 

 

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1is contiguous and is not, in the aggregate, less than 250 acres
2nor more than 500 acres which must include only parcels of real
3property directly and substantially benefited by the proposed
4STAR bond district plan, (ii) is adjacent to a federal
5interstate highway, (iii) is within one mile of 2 State
6highways, (iv) is within one mile of an entertainment user, or
7a major or minor league sports stadium or other similar
8entertainment venue that had an initial capital investment of
9at least $20,000,000, and (v) includes land that was
10previously surface or strip mined. The area may be bisected by
11streets, highways, roads, alleys, railways, bike paths,
12streams, rivers, and other waterways and still be deemed
13contiguous. In addition, in order to constitute an eligible
14area one of the following requirements must be satisfied and
15all of which are subject to the review and approval of the
16Director as provided in subsection (d) of Section 15:
17        (a) the governing body of the political subdivision
18    shall have determined that the area meets the requirements
19    of a "blighted area" as defined under the Tax Increment
20    Allocation Redevelopment Act; or
21        (b) the governing body of the political subdivision
22    shall have determined that the area is a blighted area as
23    determined under the provisions of Section 11-74.3-5 of
24    the Illinois Municipal Code; or
25        (c) the governing body of the political subdivision
26    shall make the following findings:

 

 

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1            (i) that the vacant portions of the area have
2        remained vacant for at least one year, or that any
3        building located on a vacant portion of the property
4        was demolished within the last year and that the
5        building would have qualified under item (ii) of this
6        subsection;
7            (ii) if portions of the area are currently
8        developed, that the use, condition, and character of
9        the buildings on the property are not consistent with
10        the purposes set forth in Section 5;
11            (iii) that the STAR bond district is expected to
12        create or retain job opportunities within the
13        political subdivision;
14            (iv) that the STAR bond district will serve to
15        further the development of adjacent areas;
16            (v) that without the availability of STAR bonds,
17        the projects described in the STAR bond district plan
18        would not be possible;
19            (vi) that the master developer meets high
20        standards of creditworthiness and financial strength
21        as demonstrated by one or more of the following: (i)
22        corporate debenture ratings of BBB or higher by
23        Standard & Poor's Corporation or Baa or higher by
24        Moody's Investors Service, Inc.; (ii) a letter from a
25        financial institution with assets of $10,000,000 or
26        more attesting to the financial strength of the master

 

 

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1        developer; or (iii) specific evidence of equity
2        financing for not less than 10% of the estimated total
3        STAR bond project costs;
4            (vii) that the STAR bond district will strengthen
5        the commercial sector of the political subdivision;
6            (viii) that the STAR bond district will enhance
7        the tax base of the political subdivision; and
8            (ix) that the formation of a STAR bond district is
9        in the best interest of the political subdivision.
10    "Entertainment user" means an owner, operator, licensee,
11co-developer, subdeveloper, or tenant that operates a business
12within a STAR bond district that has a primary use of providing
13a venue for entertainment attractions, rides, or other
14activities oriented toward the entertainment and amusement of
15its patrons, occupies at least 20 acres of land in the STAR
16bond district, and makes an initial capital investment,
17including project costs and other direct and indirect costs,
18of not less than $25,000,000 for that venue.
19    "Feasibility study" means a feasibility study as defined
20in subsection (b) of Section 20.
21    "Infrastructure" means the public improvements and private
22improvements that serve the public purposes set forth in
23Section 5 of this Act and that benefit the STAR bond district
24or any STAR bond projects, including, but not limited to,
25streets, drives and driveways, traffic and directional signs
26and signals, parking lots and parking facilities,

 

 

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1interchanges, highways, sidewalks, bridges, underpasses and
2overpasses, bike and walking trails, sanitary storm sewers and
3lift stations, drainage conduits, channels, levees, canals,
4storm water detention and retention facilities, utilities and
5utility connections, water mains and extensions, and street
6and parking lot lighting and connections.
7    "Local sales taxes" means any locally-imposed taxes
8received by a municipality, county, or other local
9governmental entity arising from sales by retailers and
10servicemen within a STAR bond district, including business
11district sales taxes and STAR bond occupation taxes, and that
12portion of the net revenue realized under the Retailers'
13Occupation Tax Act, the Use Tax Act, the Service Use Tax Act,
14and the Service Occupation Tax Act from transactions at places
15of business located within a STAR bond district, including
16that portion of the net revenue that would have been realized
17but for the reduction of the rate to 0% under this amendatory
18Act of the 102nd General Assembly, that is deposited or, under
19this amendatory Act of the 102nd General Assembly, transferred
20into the Local Government Tax Fund and the County and Mass
21Transit District Fund. For the purpose of this Act, "local
22sales taxes" does not include (i) any taxes authorized
23pursuant to the Local Mass Transit District Act or the
24Metro-East Park and Recreation District Act for so long as the
25applicable taxing district does not impose a tax on real
26property, (ii) county school facility and resources occupation

 

 

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1taxes imposed pursuant to Section 5-1006.7 of the Counties
2Code, or (iii) any taxes authorized under the Flood Prevention
3District Act.
4    "Local sales tax increment" means, except as otherwise
5provided in this Section, with respect to local sales taxes
6administered by the Illinois Department of Revenue, (i) all of
7the local sales tax paid (plus all of the local sales tax that
8would have been paid but for the reduction of the rate to 0%
9under this amendatory Act of the 102nd General Assembly) by
10destination users, destination hotels, and entertainment users
11that is in excess of the local sales tax paid (plus all of the
12local sales tax that would have been paid but for the reduction
13of the rate to 0% under this amendatory Act of the 102nd
14General Assembly) by destination users, destination hotels,
15and entertainment users for the same month in the base year, as
16determined by the Illinois Department of Revenue, (ii) in the
17case of a municipality forming a STAR bond district that is
18wholly within the corporate boundaries of the municipality and
19in the case of a municipality and county forming a STAR bond
20district that is only partially within such municipality, that
21portion of the local sales tax paid (plus the local sales tax
22that would have been paid but for the reduction of the rate to
230% under this amendatory Act of the 102nd General Assembly) by
24taxpayers that are not destination users, destination hotels,
25or entertainment users that is in excess of the local sales tax
26paid (plus the local sales tax that would have been paid but

 

 

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1for the reduction of the rate to 0% under this amendatory Act
2of the 102nd General Assembly) by taxpayers that are not
3destination users, destination hotels, or entertainment users
4for the same month in the base year, as determined by the
5Illinois Department of Revenue, and (iii) in the case of a
6county in which a STAR bond district is formed that is wholly
7within a municipality, that portion of the local sales tax
8paid by taxpayers that are not destination users, destination
9hotels, or entertainment users that is in excess of the local
10sales tax paid by taxpayers that are not destination users,
11destination hotels, or entertainment users for the same month
12in the base year, as determined by the Illinois Department of
13Revenue, but only if the corporate authorities of the county
14adopts an ordinance, and files a copy with the Department
15within the same time frames as required for STAR bond
16occupation taxes under Section 31, that designates the taxes
17referenced in this clause (iii) as part of the local sales tax
18increment under this Act. "Local sales tax increment" means,
19with respect to local sales taxes administered by a
20municipality, county, or other unit of local government, that
21portion of the local sales tax that is in excess of the local
22sales tax for the same month in the base year, as determined by
23the respective municipality, county, or other unit of local
24government. If any portion of local sales taxes are, at the
25time of formation of a STAR bond district, already subject to
26tax increment financing under the Tax Increment Allocation

 

 

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1Redevelopment Act, then the local sales tax increment for such
2portion shall be frozen at the base year established in
3accordance with this Act, and all future incremental increases
4shall be included in the "local sales tax increment" under
5this Act. Any party otherwise entitled to receipt of
6incremental local sales tax revenues through an existing tax
7increment financing district shall be entitled to continue to
8receive such revenues up to the amount frozen in the base year.
9Nothing in this Act shall affect the prior qualification of
10existing redevelopment project costs incurred that are
11eligible for reimbursement under the Tax Increment Allocation
12Redevelopment Act. In such event, prior to approving a STAR
13bond district, the political subdivision forming the STAR bond
14district shall take such action as is necessary, including
15amending the existing tax increment financing district
16redevelopment plan, to carry out the provisions of this Act.
17The Illinois Department of Revenue shall allocate the local
18sales tax increment only if the local sales tax is
19administered by the Department. "Local sales tax increment"
20does not include taxes and penalties collected on aviation
21fuel, as defined in Section 3 of the Retailers' Occupation
22Tax, sold on or after December 1, 2019 and through December 31,
232020.
24    "Market study" means a study to determine the ability of
25the proposed STAR bond project to gain market share locally
26and regionally and to remain profitable past the term of

 

 

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1repayment of STAR bonds.
2    "Master developer" means a developer cooperating with a
3political subdivision to plan, develop, and implement a STAR
4bond project plan for a STAR bond district. Subject to the
5limitations of Section 25, the master developer may work with
6and transfer certain development rights to other developers
7for the purpose of implementing STAR bond project plans and
8achieving the purposes of this Act. A master developer for a
9STAR bond district shall be appointed by a political
10subdivision in the resolution establishing the STAR bond
11district, and the master developer must, at the time of
12appointment, own or have control of, through purchase
13agreements, option contracts, or other means, not less than
1450% of the acreage within the STAR bond district and the master
15developer or its affiliate must have ownership or control on
16June 1, 2010.
17    "Master development agreement" means an agreement between
18the master developer and the political subdivision to govern a
19STAR bond district and any STAR bond projects.
20    "Municipality" means the city, village, or incorporated
21town in which a proposed STAR bond district is located.
22    "Pledged STAR revenues" means those sales tax and revenues
23and other sources of funds pledged to pay debt service on STAR
24bonds or to pay project costs pursuant to Section 30.
25Notwithstanding any provision to the contrary, the following
26revenues shall not constitute pledged STAR revenues or be

 

 

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1available to pay principal and interest on STAR bonds: any
2State sales tax increment or local sales tax increment from a
3retail entity initiating operations in a STAR bond district
4while terminating operations at another Illinois location
5within 25 miles of the STAR bond district. For purposes of this
6paragraph, "terminating operations" means a closing of a
7retail operation that is directly related to the opening of
8the same operation or like retail entity owned or operated by
9more than 50% of the original ownership in a STAR bond district
10within one year before or after initiating operations in the
11STAR bond district, but it does not mean closing an operation
12for reasons beyond the control of the retail entity, as
13documented by the retail entity, subject to a reasonable
14finding by the municipality (or county if such retail
15operation is not located within a municipality) in which the
16terminated operations were located that the closed location
17contained inadequate space, had become economically obsolete,
18or was no longer a viable location for the retailer or
19serviceman.
20    "Political subdivision" means a municipality or county
21which undertakes to establish a STAR bond district pursuant to
22the provisions of this Act.
23    "Project costs" means and includes the sum total of all
24costs incurred or estimated to be incurred on or following the
25date of establishment of a STAR bond district that are
26reasonable or necessary to implement a STAR bond district plan

 

 

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1or any STAR bond project plans, or both, including costs
2incurred for public improvements and private improvements that
3serve the public purposes set forth in Section 5 of this Act.
4Such costs include without limitation the following:
5        (a) costs of studies, surveys, development of plans
6    and specifications, formation, implementation, and
7    administration of a STAR bond district, STAR bond district
8    plan, any STAR bond projects, or any STAR bond project
9    plans, including, but not limited to, staff and
10    professional service costs for architectural, engineering,
11    legal, financial, planning, or other services, provided
12    however that no charges for professional services may be
13    based on a percentage of the tax increment collected and
14    no contracts for professional services, excluding
15    architectural and engineering services, may be entered
16    into if the terms of the contract extend beyond a period of
17    3 years;
18        (b) property assembly costs, including, but not
19    limited to, acquisition of land and other real property or
20    rights or interests therein, located within the boundaries
21    of a STAR bond district, demolition of buildings, site
22    preparation, site improvements that serve as an engineered
23    barrier addressing ground level or below ground
24    environmental contamination, including, but not limited
25    to, parking lots and other concrete or asphalt barriers,
26    the clearing and grading of land, and importing additional

 

 

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1    soil and fill materials, or removal of soil and fill
2    materials from the site;
3        (c) subject to paragraph (d), costs of buildings and
4    other vertical improvements that are located within the
5    boundaries of a STAR bond district and owned by a
6    political subdivision or other public entity, including
7    without limitation police and fire stations, educational
8    facilities, and public restrooms and rest areas;
9        (c-1) costs of buildings and other vertical
10    improvements that are located within the boundaries of a
11    STAR bond district and owned by a destination user or
12    destination hotel; except that only 2 destination users in
13    a STAR bond district and one destination hotel are
14    eligible to include the cost of those vertical
15    improvements as project costs;
16        (c-5) costs of buildings; rides and attractions, which
17    include carousels, slides, roller coasters, displays,
18    models, towers, works of art, and similar theme and
19    amusement park improvements; and other vertical
20    improvements that are located within the boundaries of a
21    STAR bond district and owned by an entertainment user;
22    except that only one entertainment user in a STAR bond
23    district is eligible to include the cost of those vertical
24    improvements as project costs;
25        (d) costs of the design and construction of
26    infrastructure and public works located within the

 

 

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1    boundaries of a STAR bond district that are reasonable or
2    necessary to implement a STAR bond district plan or any
3    STAR bond project plans, or both, except that project
4    costs shall not include the cost of constructing a new
5    municipal public building principally used to provide
6    offices, storage space, or conference facilities or
7    vehicle storage, maintenance, or repair for
8    administrative, public safety, or public works personnel
9    and that is not intended to replace an existing public
10    building unless the political subdivision makes a
11    reasonable determination in a STAR bond district plan or
12    any STAR bond project plans, supported by information that
13    provides the basis for that determination, that the new
14    municipal building is required to meet an increase in the
15    need for public safety purposes anticipated to result from
16    the implementation of the STAR bond district plan or any
17    STAR bond project plans;
18        (e) costs of the design and construction of the
19    following improvements located outside the boundaries of a
20    STAR bond district, provided that the costs are essential
21    to further the purpose and development of a STAR bond
22    district plan and either (i) part of and connected to
23    sewer, water, or utility service lines that physically
24    connect to the STAR bond district or (ii) significant
25    improvements for adjacent offsite highways, streets,
26    roadways, and interchanges that are approved by the

 

 

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1    Illinois Department of Transportation. No other cost of
2    infrastructure and public works improvements located
3    outside the boundaries of a STAR bond district may be
4    deemed project costs;
5        (f) costs of job training and retraining projects,
6    including the cost of "welfare to work" programs
7    implemented by businesses located within a STAR bond
8    district;
9        (g) financing costs, including, but not limited to,
10    all necessary and incidental expenses related to the
11    issuance of obligations and which may include payment of
12    interest on any obligations issued hereunder including
13    interest accruing during the estimated period of
14    construction of any improvements in a STAR bond district
15    or any STAR bond projects for which such obligations are
16    issued and for not exceeding 36 months thereafter and
17    including reasonable reserves related thereto;
18        (h) to the extent the political subdivision by written
19    agreement accepts and approves the same, all or a portion
20    of a taxing district's capital costs resulting from a STAR
21    bond district or STAR bond projects necessarily incurred
22    or to be incurred within a taxing district in furtherance
23    of the objectives of a STAR bond district plan or STAR bond
24    project plans;
25        (i) interest cost incurred by a developer for project
26    costs related to the acquisition, formation,

 

 

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1    implementation, development, construction, and
2    administration of a STAR bond district, STAR bond district
3    plan, STAR bond projects, or any STAR bond project plans
4    provided that:
5            (i) payment of such costs in any one year may not
6        exceed 30% of the annual interest costs incurred by
7        the developer with regard to the STAR bond district or
8        any STAR bond projects during that year; and
9            (ii) the total of such interest payments paid
10        pursuant to this Act may not exceed 30% of the total
11        cost paid or incurred by the developer for a STAR bond
12        district or STAR bond projects, plus project costs,
13        excluding any property assembly costs incurred by a
14        political subdivision pursuant to this Act;
15        (j) costs of common areas located within the
16    boundaries of a STAR bond district;
17        (k) costs of landscaping and plantings, retaining
18    walls and fences, man-made lakes and ponds, shelters,
19    benches, lighting, and similar amenities located within
20    the boundaries of a STAR bond district;
21        (l) costs of mounted building signs, site monument,
22    and pylon signs located within the boundaries of a STAR
23    bond district; or
24        (m) if included in the STAR bond district plan and
25    approved in writing by the Director, salaries or a portion
26    of salaries for local government employees to the extent

 

 

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1    the same are directly attributable to the work of such
2    employees on the establishment and management of a STAR
3    bond district or any STAR bond projects.
4    Except as specified in items (a) through (m), "project
5costs" shall not include:
6        (i) the cost of construction of buildings that are
7    privately owned or owned by a municipality and leased to a
8    developer or retail user for non-entertainment retail
9    uses;
10        (ii) moving expenses for employees of the businesses
11    locating within the STAR bond district;
12        (iii) property taxes for property located in the STAR
13    bond district;
14        (iv) lobbying costs; and
15        (v) general overhead or administrative costs of the
16    political subdivision that would still have been incurred
17    by the political subdivision if the political subdivision
18    had not established a STAR bond district.
19    "Project development agreement" means any one or more
20agreements, including any amendments thereto, between a master
21developer and any co-developer or subdeveloper in connection
22with a STAR bond project, which project development agreement
23may include the political subdivision as a party.
24    "Project labor agreement" means a prehire collective
25bargaining agreement that covers all terms and conditions of
26employment between the general contractor and all

 

 

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1subcontractors hired by the master developer, developer,
2co-developer, or subdeveloper, as applicable, of a STAR bond
3project and the local building and construction trades council
4having geographic jurisdiction over a STAR bond project. A
5"project labor agreement" must include the following
6provisions: (1) a provision establishing the minimum hourly
7wage for each class of labor organization employee; (2) a
8provision establishing the benefits and other compensation for
9each class of labor organization employee; (3) a provision
10requiring that no strike or dispute will be engaged in by the
11labor organization employees; (4) a provision requiring that
12no lockout or dispute will be engaged in by the general
13contractor and all subcontractors building the project; and
14(5) a provision establishing goals for apprenticeship hours to
15be performed by minority persons and women, as those terms are
16defined under the Business Enterprise for Minorities, Women,
17and Persons with Disabilities Act, and goals for total hours
18to be performed by minority persons and women. A "project
19labor agreement" may include other terms and conditions as the
20appropriate building and construction trades council and the
21general contractor building the STAR bond project deem
22necessary.
23    "Projected market area" means any area within the State in
24which a STAR bond district or STAR bond project is projected to
25have a significant fiscal or market impact as determined by
26the Director.

 

 

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1    "Resolution" means a resolution, order, ordinance, or
2other appropriate form of legislative action of a political
3subdivision or other applicable public entity approved by a
4vote of a majority of a quorum at a meeting of the governing
5body of the political subdivision or applicable public entity.
6    "STAR bond" means a sales tax and revenue bond, note, or
7other obligation payable from pledged STAR revenues and issued
8by a political subdivision, the proceeds of which shall be
9used only to pay project costs as defined in this Act.
10    "STAR bond district" means the specific area declared to
11be an eligible area as determined by the political
12subdivision, and approved by the Director, in which the
13political subdivision may develop one or more STAR bond
14projects.
15    "STAR bond district plan" means the preliminary or
16conceptual plan that generally identifies the proposed STAR
17bond project areas and identifies in a general manner the
18buildings, facilities, and improvements to be constructed or
19improved in each STAR bond project area.
20    "STAR bond project" means a project within a STAR bond
21district which is approved pursuant to Section 20.
22    "STAR bond project area" means the geographic area within
23a STAR bond district in which there may be one or more STAR
24bond projects.
25    "STAR bond project plan" means the written plan adopted by
26a political subdivision for the development of a STAR bond

 

 

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1project in a STAR bond district; the plan may include, but is
2not limited to, (i) project costs incurred prior to the date of
3the STAR bond project plan and estimated future STAR bond
4project costs, (ii) proposed sources of funds to pay those
5costs, (iii) the nature and estimated term of any obligations
6to be issued by the political subdivision to pay those costs,
7(iv) the most recent equalized assessed valuation of the STAR
8bond project area, (v) an estimate of the equalized assessed
9valuation of the STAR bond district or applicable project area
10after completion of a STAR bond project, (vi) a general
11description of the types of any known or proposed developers,
12users, or tenants of the STAR bond project or projects
13included in the plan, (vii) a general description of the type,
14structure, and character of the property or facilities to be
15developed or improved, (viii) a description of the general
16land uses to apply to the STAR bond project, and (ix) a general
17description or an estimate of the type, class, and number of
18employees to be employed in the operation of the STAR bond
19project, and (x) a project labor agreement.
20    "State sales tax" means all of the net revenue realized
21under the Retailers' Occupation Tax Act, the Use Tax Act, the
22Service Use Tax Act, and the Service Occupation Tax Act from
23transactions at places of business located within a STAR bond
24district, excluding that portion of the net revenue realized
25under the Retailers' Occupation Tax Act, the Use Tax Act, the
26Service Use Tax Act, and the Service Occupation Tax Act from

 

 

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1transactions at places of business located within a STAR bond
2district that is deposited into the Local Government Tax Fund
3and the County and Mass Transit District Fund.
4    "State sales tax increment" means (i) 100% of that portion
5of the State sales tax that is in excess of the State sales tax
6for the same month in the base year, as determined by the
7Department of Revenue, from transactions at up to 2
8destination users, one destination hotel, and one
9entertainment user located within a STAR bond district, which
10destination users, destination hotel, and entertainment user
11shall be designated by the master developer and approved by
12the political subdivision and the Director in conjunction with
13the applicable STAR bond project approval, and (ii) 25% of
14that portion of the State sales tax that is in excess of the
15State sales tax for the same month in the base year, as
16determined by the Department of Revenue, from all other
17transactions within a STAR bond district. If any portion of
18State sales taxes are, at the time of formation of a STAR bond
19district, already subject to tax increment financing under the
20Tax Increment Allocation Redevelopment Act, then the State
21sales tax increment for such portion shall be frozen at the
22base year established in accordance with this Act, and all
23future incremental increases shall be included in the State
24sales tax increment under this Act. Any party otherwise
25entitled to receipt of incremental State sales tax revenues
26through an existing tax increment financing district shall be

 

 

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1entitled to continue to receive such revenues up to the amount
2frozen in the base year. Nothing in this Act shall affect the
3prior qualification of existing redevelopment project costs
4incurred that are eligible for reimbursement under the Tax
5Increment Allocation Redevelopment Act. In such event, prior
6to approving a STAR bond district, the political subdivision
7forming the STAR bond district shall take such action as is
8necessary, including amending the existing tax increment
9financing district redevelopment plan, to carry out the
10provisions of this Act.
11    "Substantial change" means a change wherein the proposed
12STAR bond project plan differs substantially in size, scope,
13or use from the approved STAR bond district plan or STAR bond
14project plan.
15    "Taxpayer" means an individual, partnership, corporation,
16limited liability company, trust, estate, or other entity that
17is subject to the Illinois Income Tax Act.
18    "Total development costs" means the aggregate public and
19private investment in a STAR bond district, including project
20costs and other direct and indirect costs related to the
21development of the STAR bond district.
22    "Traditional retail use" means the operation of a business
23that derives at least 90% of its annual gross revenue from
24sales at retail, as that phrase is defined by Section 1 of the
25Retailers' Occupation Tax Act, but does not include the
26operations of destination users, entertainment users,

 

 

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1restaurants, hotels, retail uses within hotels, or any other
2non-retail uses.
3    "Vacant" means that portion of the land in a proposed STAR
4bond district that is not occupied by a building, facility, or
5other vertical improvement.
6(Source: P.A. 101-10, eff. 6-5-19; 101-455, eff. 8-23-19;
7101-604, eff. 12-13-19; 102-700, eff. 4-19-22.)
 
8    (50 ILCS 470/20)
9    Sec. 20. Approval of STAR bond projects. The governing
10body of a political subdivision may establish one or more STAR
11bond projects in any STAR bond district. A STAR bond project
12which is partially outside the boundaries of a municipality
13must also be approved by the governing body of the county by
14resolution.
15    (a) After the establishment of a STAR bond district, the
16master developer may propose one or more STAR bond projects to
17a political subdivision and the master developer shall, in
18cooperation with the political subdivision, prepare a STAR
19bond project plan in consultation with the planning commission
20of the political subdivision, if any. The STAR bond project
21plan may be implemented in separate development stages.
22    (b) Any political subdivision considering a STAR bond
23project within a STAR bond district shall notify the
24Department, which shall cause to be prepared an independent
25feasibility study by a feasibility consultant with certified

 

 

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1copies provided to the political subdivision, the Director,
2and the Department of Commerce and Economic Opportunity. The
3feasibility study shall include the following:
4        (1) the estimated amount of pledged STAR revenues
5    expected to be collected in each year through the maturity
6    date of the proposed STAR bonds;
7        (2) a statement of how the jobs and taxes obtained
8    from the STAR bond project will contribute significantly
9    to the economic development of the State and region;
10        (3) visitation expectations;
11        (4) the unique quality of the project;
12        (5) an economic impact study;
13        (6) a market study;
14        (7) integration and collaboration with other resources
15    or businesses;
16        (8) the quality of service and experience provided, as
17    measured against national consumer standards for the
18    specific target market;
19        (9) project accountability, measured according to best
20    industry practices;
21        (10) the expected return on State and local investment
22    that the STAR bond project is anticipated to produce; and
23        (11) an anticipated principal and interest payment
24    schedule on the STAR bonds.
25    The feasibility consultant, along with the independent
26economist and any other consultants commissioned to perform

 

 

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1the studies and other analysis required by the feasibility
2study, shall be selected by the Director with the approval of
3the political subdivision. The consultants shall be retained
4by the Director and the Department shall be reimbursed by the
5master developer for the costs to retain the consultants.
6    The failure to include all information enumerated in this
7subsection in the feasibility study for a STAR bond project
8shall not affect the validity of STAR bonds issued pursuant to
9this Act.
10    (c) If the political subdivision determines the STAR bond
11project is feasible, the STAR bond project plan shall include:
12        (1) a summary of the feasibility study;
13        (2) a reference to the STAR bond district plan that
14    identifies the STAR bond project area that is set forth in
15    the STAR bond project plan that is being considered;
16        (3) a legal description and map of the STAR bond
17    project area to be developed or redeveloped;
18        (4) a description of the buildings and facilities
19    proposed to be constructed or improved in such STAR bond
20    project area, including destination users and an
21    entertainment user, as applicable;
22        (5) a copy of letters of intent to locate within the
23    STAR bond district signed by both the master developer and
24    the appropriate corporate officer of at least one
25    destination user for the first STAR bond project proposed
26    within the district; and

 

 

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1        (6) any other information the governing body of the
2    political subdivision deems reasonable and necessary to
3    advise the public of the intent of the STAR bond project
4    plan.
5    (d) Before a political subdivision may hold a public
6hearing to consider a STAR bond project plan, the political
7subdivision must apply to the Department for approval of the
8STAR bond project plan. An application for approval of a STAR
9bond project plan must not be approved unless all of the
10components of the feasibility study set forth in items (1)
11through (11) of subsection (b) have been completed and
12submitted to the Department for review. In addition to
13reviewing all of the other elements of the STAR bond project
14plan required under subsection (c), which must be included in
15the application (which plan must include a letter or letters
16of intent as required under subdivision (c)(5) in order to
17receive Director approval), the Director must review the
18feasibility study and consider all of the components of the
19feasibility study set forth in items (1) through (11) of
20subsection (b) of Section 20, including, without limitation,
21the economic impact study and the financial benefit of the
22proposed STAR bond project to the local, regional, and State
23economies, the proposed adverse impacts on similar businesses
24and projects as well as municipalities within the market area,
25and the net effect of the proposed STAR bond project on the
26local, regional, and State economies. In addition to the

 

 

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1economic impact study, the political subdivision must also
2submit to the Department, as part of its application, the
3financial and other information that substantiates the basis
4for the conclusion of the economic impact study, in the form
5and manner as required by the Department, so that the
6Department can verify the results of the study. In addition to
7any other criteria in this subsection, to approve any STAR
8bond project plan submitted on or after the effective date of
9this amendatory Act of the 103rd General Assembly, the
10political subdivision must also submit to the Department, as
11part of its application, a signed project labor agreement. In
12addition to any other criteria in this subsection, to approve
13the STAR bond project plan, the Director must be satisfied
14that the proposed destination user is in fact a true
15destination user and also find that the STAR bond project plan
16is in accordance with the purpose of this Act and the public
17interest. The Director shall either approve or deny the STAR
18bond project plan based on the criteria in this subsection. In
19granting its approval, the Department may require the
20political subdivision to execute a binding agreement or
21memorandum of understanding with the State. The terms of the
22agreement or memorandum may include, among other things, the
23political subdivision's repayment of the State sales tax
24increment distributed to it should any violation of the
25agreement or memorandum or this Act occur.
26    (e) Upon a finding by the planning and zoning commission

 

 

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1of the political subdivision that the STAR bond project plan
2is consistent with the intent of the comprehensive plan for
3the development of the political subdivision and upon issuance
4of written approval of the STAR bond project plan from the
5Director pursuant to subsection (d) of Section 20, the
6governing body of the political subdivision shall adopt a
7resolution stating that the political subdivision is
8considering the adoption of the STAR bond project plan. The
9resolution shall:
10        (1) give notice that a public hearing will be held to
11    consider the adoption of the STAR bond project plan and
12    fix the date, hour, and place of the public hearing;
13        (2) describe the general boundaries of the STAR bond
14    district within which the STAR bond project will be
15    located and the date of establishment of the STAR bond
16    district;
17        (3) describe the general boundaries of the area
18    proposed to be included within the STAR bond project area;
19        (4) provide that the STAR bond project plan and map of
20    the area to be redeveloped or developed are available for
21    inspection during regular office hours in the offices of
22    the political subdivision; and
23        (5) contain a summary of the terms and conditions of
24    any proposed project development agreement with the
25    political subdivision.
26    (f) A public hearing shall be conducted to consider the

 

 

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1adoption of any STAR bond project plan.
2        (1) The date fixed for the public hearing to consider
3    the adoption of the STAR bond project plan shall be not
4    less than 20 nor more than 90 days following the date of
5    the adoption of the resolution fixing the date of the
6    hearing.
7        (2) A copy of the political subdivision's resolution
8    providing for the public hearing shall be sent by
9    certified mail, return receipt requested, to the governing
10    body of the county. A copy of the political subdivision's
11    resolution providing for the public hearing shall be sent
12    by certified mail, return receipt requested, to each
13    person or persons in whose name the general taxes for the
14    last preceding year were paid on each parcel of land lying
15    within the proposed STAR bond project area within 10 days
16    following the date of the adoption of the resolution. The
17    resolution shall be published once in a newspaper of
18    general circulation in the political subdivision not less
19    than one week nor more than 3 weeks preceding the date
20    fixed for the public hearing. A map or aerial photo
21    clearly delineating the area of land proposed to be
22    included within the STAR bond project area shall be
23    published with the resolution.
24        (3) The hearing shall be held at a location that is
25    within 20 miles of the STAR bond district, in a facility
26    that can accommodate a large crowd, and in a facility that

 

 

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1    is accessible to persons with disabilities.
2        (4) At the public hearing, a representative of the
3    political subdivision or master developer shall present
4    the STAR bond project plan. Following the presentation of
5    the STAR bond project plan, all interested persons shall
6    be given an opportunity to be heard. The governing body
7    may continue the date and time of the public hearing.
8    (g) Upon conclusion of the public hearing, the governing
9body of the political subdivision may adopt the STAR bond
10project plan by a resolution approving the STAR bond project
11plan.
12    (h) After the adoption by the corporate authorities of the
13political subdivision of a STAR bond project plan, the
14political subdivision may enter into a project development
15agreement if the master developer has requested the political
16subdivision to be a party to the project development agreement
17pursuant to subsection (b) of Section 25.
18    (i) Within 30 days after the adoption by the political
19subdivision of a STAR bond project plan, the clerk of the
20political subdivision shall transmit a copy of the legal
21description of the land and a list of all new and existing
22mailing addresses within the STAR bond district, a copy of the
23resolution adopting the STAR bond project plan, and a map or
24plat indicating the boundaries of the STAR bond project area
25to the clerk, treasurer, and governing body of the county and
26to the Department of Revenue. Within 30 days of creation of any

 

 

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1new mailing addresses within a STAR bond district, the clerk
2of the political subdivision shall provide written notice of
3such new addresses to the Department of Revenue.
4    If a certified copy of the resolution adopting the STAR
5bond project plan is filed with the Department on or before the
6first day of April, the Department, if all other requirements
7of this subsection are met, shall proceed to collect and
8allocate any local sales tax increment and any State sales tax
9increment in accordance with the provisions of this Act as of
10the first day of July next following the adoption and filing.
11If a certified copy of the resolution adopting the STAR bond
12project plan is filed with the Department after April 1 but on
13or before the first day of October, the Department, if all
14other requirements of this subsection are met, shall proceed
15to collect and allocate any local sales tax increment and any
16State sales tax increment in accordance with the provisions of
17this Act as of the first day of January next following the
18adoption and filing.
19    Any substantial changes to a STAR bond project plan as
20adopted shall be subject to a public hearing following
21publication of notice thereof in a newspaper of general
22circulation in the political subdivision and approval by
23resolution of the governing body of the political subdivision.
24    The Department of Revenue shall not collect or allocate
25any local sales tax increment or State sales tax increment
26until the political subdivision also provides, in the manner

 

 

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1prescribed by the Department, the boundaries of the STAR bond
2project area and each address in the STAR bond project area in
3such a way that the Department can determine by its address
4whether a business is located in the STAR bond project area.
5The political subdivision must provide this boundary and
6address information to the Department on or before April 1 for
7administration and enforcement under this Act by the
8Department beginning on the following July 1 and on or before
9October 1 for administration and enforcement under this Act by
10the Department beginning on the following January 1. The
11Department of Revenue shall not administer or enforce any
12change made to the boundaries of a STAR bond project or any
13address change, addition, or deletion until the political
14subdivision reports the boundary change or address change,
15addition, or deletion to the Department in the manner
16prescribed by the Department. The political subdivision must
17provide this boundary change or address change, addition, or
18deletion information to the Department on or before April 1
19for administration and enforcement by the Department of the
20change, addition, or deletion beginning on the following July
211 and on or before October 1 for administration and
22enforcement by the Department of the change, addition, or
23deletion beginning on the following January 1. If a retailer
24is incorrectly included or excluded from the list of those
25located in the STAR bond project, the Department of Revenue
26shall be held harmless if it reasonably relied on information

 

 

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1provided by the political subdivision.
2    (j) Any STAR bond project must be approved by the
3political subdivision prior to that date which is 23 years
4from the date of the approval of the STAR bond district,
5provided however that any amendments to such STAR bond project
6may occur following such date.
7    (k) Any developer of a STAR bond project shall commence
8work on the STAR bond project within 3 years from the date of
9adoption of the STAR bond project plan. Before commencing work
10on a STAR bond project, the developer must enter into a project
11labor agreement. If the developer fails to commence work on
12the STAR bond project within the 3-year period, funding for
13the project shall cease and the developer of the project or
14complex shall have one year to appeal to the political
15subdivision for reapproval of the project and funding. If the
16project is reapproved, the 3-year period for commencement
17shall begin again on the date of the reapproval.
18    (l) After the adoption by the corporate authorities of the
19political subdivision of a STAR bond project plan and approval
20of the Director pursuant to subsection (d) of Section 20, the
21political subdivision may authorize the issuance of the STAR
22bonds in one or more series to finance the STAR bond project in
23accordance with the provisions of this Act, except the
24corporate authorities of the political subdivision may only
25authorize the issuance of STAR bonds if the master developer,
26co-developer, or subdeveloper, as applicable, has entered into

 

 

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1a project labor agreement.
2    (m) The maximum maturity of STAR bonds issued to finance a
3STAR bond project shall not exceed 23 years from the first date
4of distribution of State sales tax revenues from such STAR
5bond project to the political subdivision unless the political
6subdivision extends such maturity by resolution up to a
7maximum of 35 years from such first distribution date. Any
8such extension shall require the approval of the Director. In
9no event shall the maximum maturity date for any STAR bonds
10exceed that date which is 35 years from the first distribution
11date of the first STAR bonds issued in a STAR bond district.
12(Source: P.A. 103-8, eff. 6-7-23.)
 
13    Section 99. Effective date. This Act takes effect upon
14becoming law.".