State of Illinois
92nd General Assembly

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[ Introduced ][ Engrossed ][ Senate Amendment 002 ]


HB1276 Enrolled                                LRB9203258SMdv

 1        AN ACT in relation to taxes.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 5.  The Property Tax Code is amended by  changing
 5    Sections 9-195 and  15-60 as follows:

 6        (35 ILCS 200/9-195)
 7        Sec. 9-195.  Leasing of exempt property.
 8        (a)  Except  as provided in Sections 15-35, 15-55, 15-60,
 9    15-100, and  15-103,  when  property  which  is  exempt  from
10    taxation  is  leased to another whose property is not exempt,
11    and the leasing of which does not make the property  taxable,
12    the leasehold estate and the appurtenances shall be listed as
13    the  property  of the lessee thereof, or his or her assignee.
14    Taxes on that property shall be collected in the same  manner
15    as  on  property  that is not exempt, and the lessee shall be
16    liable for those taxes.  However, no tax lien shall attach to
17    the exempt real estate. The changes made by  this  amendatory
18    Act  of  1997  and by this amendatory Act of the 91st General
19    Assembly  are declaratory of existing law and  shall  not  be
20    construed  as  a  new  enactment.  The changes made by Public
21    Acts 88-221  and  88-420  that  are  incorporated  into  this
22    Section  by  this  amendatory  Act of 1993 are declarative of
23    existing law and are not a new enactment.
24        (b)  The provisions of this Section regarding taxation of
25    leasehold interests in exempt property do not  apply  to  any
26    leasehold   interest  created  pursuant  to  any  transaction
27    described in subsection  (e)  of  Section  15-35,  subsection
28    (c-5)  of Section 15-60, subsection (b) of Section 15-100, or
29    Section 15-103.
30    (Source: P.A. 90-562, eff. 12-16-97; 91-513, eff. 8-13-99.)
HB1276 Enrolled            -2-                 LRB9203258SMdv
 1        (35 ILCS 200/15-60)
 2        Sec.  15-60.   Taxing  district  property.  All  property
 3    belonging to any county or municipality used exclusively  for
 4    the  maintenance  of  the  poor is exempt, as is all property
 5    owned by a taxing district that  is  being  held  for  future
 6    expansion  or  development,  except  if  leased by the taxing
 7    district to lessees for use for other than public purposes.
 8        Also exempt are:
 9        (a)  all swamp  or  overflowed  lands  belonging  to  any
10    county;
11        (b)  all   public  buildings  belonging  to  any  county,
12    township, or municipality,  with  the  ground  on  which  the
13    buildings are erected;
14        (c)  all  property  owned  by  any  municipality  located
15    within  its incorporated limits.  Any such property leased by
16    a  municipality  shall  remain  exempt,  and  the   leasehold
17    interest  of the lessee shall be assessed under Section 9-195
18    of this Act, (i) for a lease entered into on or after January
19    1, 1994,  unless  the  lease  expressly  provides  that  this
20    exemption  shall  not apply; (ii) for a lease entered into on
21    or after the effective date of Public Act 87-1280 and  before
22    January  1,  1994,  unless  the lease expressly provides that
23    this exemption shall not apply or unless evidence other  than
24    the  lease  itself substantiates the intent of the parties to
25    the lease that this exemption shall not apply; and (iii)  for
26    a  lease entered into before the effective date of Public Act
27    87-1280, if the terms of the lease do not bind the lessee  to
28    pay  the  taxes on the leased property or if, notwithstanding
29    the terms  of  the  lease,  the  municipality  has  filed  or
30    hereafter files a timely exemption petition or complaint with
31    respect  to  property  consisting  of or including the leased
32    property for an assessment year which includes part or all of
33    the first 12 months  of  the  lease  period.   The  foregoing
34    clause (iii) added by Public Act 87-1280 shall not operate to
HB1276 Enrolled            -3-                 LRB9203258SMdv
 1    exempt property for any assessment year as to which no timely
 2    exemption  petition  or  complaint  has  been  filed  by  the
 3    municipality  or  as  to  which  an  administrative  or court
 4    decision   denying   exemption   has   become    final    and
 5    nonappealable.  For  each  assessment year or portion thereof
 6    that property is made exempt by operation  of  the  foregoing
 7    clause (iii), whether such year or portion is before or after
 8    the  effective  date  of  Public  Act  87-1280, the leasehold
 9    interest of the lessee shall,  if  necessary,  be  considered
10    omitted property for purposes of this Act;
11        (c-5)  Notwithstanding  clause (i) of subsection (c), all
12    property owned by a municipality with a  population  of  over
13    500,000  that  is  used for toll road or toll bridge purposes
14    and that is leased for those purposes to another entity whose
15    property is not exempt shall remain exempt, and any leasehold
16    interest in the property shall not  be  subject  to  taxation
17    under Section 9-195 of this Act;
18        (d)  all  property  owned  by  any  municipality  located
19    outside  its  incorporated  limits but within the same county
20    when used  as  a  tuberculosis  sanitarium,  farm  colony  in
21    connection with a house of correction, or nursery, garden, or
22    farm,   or   for  the  growing  of  shrubs,  trees,  flowers,
23    vegetables, and plants for use in  beautifying,  maintaining,
24    and  operating  playgrounds, parks, parkways, public grounds,
25    buildings,  and  institutions  owned  or  controlled  by  the
26    municipality; and
27        (e)  all property owned by a  township  and  operated  as
28    senior  citizen  housing under Sections 35-50 through 35-50.6
29    of the Township Code.
30        All property owned by any  municipality  outside  of  its
31    corporate  limits is exempt if used exclusively for municipal
32    or public purposes.
33        For purposes of this  Section,  "municipality"   means  a
34    municipality,  as  defined  in  Section 1-1-2 of the Illinois
HB1276 Enrolled            -4-                 LRB9203258SMdv
 1    Municipal Code.
 2    (Source: P.A. 89-165, eff. 1-1-96; 90-176, eff. 1-1-98.)

 3        Section 10.  The Illinois Municipal Code  is  amended  by
 4    changing Section 8-11-6 as follows:

 5        (65 ILCS 5/8-11-6) (from Ch. 24, par. 8-11-6)
 6        Sec. 8-11-6.  Home Rule Municipal Use Tax Act.
 7        (a)  The   corporate   authorities   of   a   home   rule
 8    municipality may impose a tax upon the privilege of using, in
 9    such  municipality,  any  item  of tangible personal property
10    which is purchased at retail from a retailer,  and  which  is
11    titled  or  registered  at  a  location  within the corporate
12    limits of such home rule municipality with an agency of  this
13    State's  government,  at a rate which is an increment of 1/4%
14    and based on the selling  price  of  such  tangible  personal
15    property,  as  "selling price" is defined in the Use Tax Act.
16    In  home  rule  municipalities  with  less   than   2,000,000
17    inhabitants,  the  tax shall be collected by the municipality
18    imposing the tax from  persons  whose  Illinois  address  for
19    titling  or  registration  purposes is given as being in such
20    municipality.
21        (b)  In home rule municipalities with 2,000,000  or  more
22    inhabitants,  the  corporate  authorities of the municipality
23    may additionally impose a tax beginning July 1, 1991 upon the
24    privilege of using in the municipality, any item of  tangible
25    personal  property,  other  than  tangible  personal property
26    titled  or  registered  with  an  agency   of   the   State's
27    government,  that  is  purchased  at  retail  from a retailer
28    located outside the corporate limits of the municipality,  at
29    a  rate  that  is  an  increment of 1/4% not to exceed 1% and
30    based on the selling price of the tangible personal property,
31    as "selling price" is defined in the Use Tax Act.   Such  tax
32    shall  be collected from the purchaser or the retailer either
HB1276 Enrolled            -5-                 LRB9203258SMdv
 1    by the municipality imposing such tax or by the Department of
 2    Revenue pursuant to an agreement between the  Department  and
 3    the municipality.
 4        To prevent multiple home rule taxation, the use in a home
 5    rule  municipality  of  tangible  personal  property  that is
 6    acquired outside the municipality and caused  to  be  brought
 7    into the municipality by a person who has already paid a home
 8    rule  municipal tax in another municipality in respect to the
 9    sale, purchase, or use of that property, shall be  exempt  to
10    the  extent of the amount of the tax properly due and paid in
11    the other home rule municipality.
12        (c)  If  a  municipality   having   2,000,000   or   more
13    inhabitants  imposes  the  tax  authorized by subsection (a),
14    then the tax shall be collected by the Illinois Department of
15    Revenue when the property  is  purchased  at  retail  from  a
16    retailer  in  the  county in which the home rule municipality
17    imposing the tax is located, and in all contiguous  counties.
18    The  tax  shall  be  remitted  to  the State, or an exemption
19    determination must be obtained from the Department before the
20    title or certificate of registration for the property may  be
21    issued.   The tax or proof of exemption may be transmitted to
22    the Department by way of the  State  agency  with  which,  or
23    State  officer with whom, the tangible personal property must
24    be titled or registered if the Department and that agency  or
25    State officer determine that this procedure will expedite the
26    processing of applications for title or registration.
27        The  Department  shall  have full power to administer and
28    enforce this Section to  collect  all  taxes,  penalties  and
29    interest  due  hereunder,  to dispose of taxes, penalties and
30    interest so collected in the manner hereinafter provided, and
31    determine all rights to credit memoranda or  refunds  arising
32    on  account  of  the  erroneous  payment  of  tax, penalty or
33    interest hereunder.  In the administration of and  compliance
34    with  this Section the Department and persons who are subject
HB1276 Enrolled            -6-                 LRB9203258SMdv
 1    to  this  Section  shall  have  the  same  rights,  remedies,
 2    privileges, immunities, powers and duties, and be subject  to
 3    the same conditions, restrictions, limitations, penalties and
 4    definitions  of terms, and employ the same modes of procedure
 5    as are prescribed in Sections 2  (except  the  definition  of
 6    "retailer  maintaining a place of business in this State"), 3
 7    (except provisions pertaining to the State rate of  tax,  and
 8    except  provisions  concerning collection or refunding of the
 9    tax by retailers), 4, 11, 12, 12a, 14, 15, 19, 20, 21 and  22
10    of  the  Use  Tax  Act,  which are not inconsistent with this
11    Section,  as  fully  as  if  provisions  contained  in  those
12    Sections of the Use Tax Act were set forth herein.
13        Whenever the Department determines that a refund shall be
14    made under this Section to a claimant instead  of  issuing  a
15    credit  memorandum,  the  Department  shall  notify the State
16    Comptroller, who shall cause the order to be  drawn  for  the
17    amount   specified,   and   to  the  person  named,  in  such
18    notification from the Department.  Such refund shall be  paid
19    by  the  State  Treasurer  out  of  the  home  rule municipal
20    retailers' occupation tax fund.
21        The Department shall forthwith  pay  over  to  the  State
22    Treasurer,  ex  officio, as trustee, all taxes, penalties and
23    interest collected hereunder.  On or before the 25th  day  of
24    each calendar month, the Department shall prepare and certify
25    to  the  State Comptroller the disbursement of stated sums of
26    money to  named  municipalities,  the  municipality  in  each
27    instance  to  be  that municipality from which the Department
28    during  the  second  preceding  calendar   month,   collected
29    municipal  use tax from any person whose Illinois address for
30    titling or registration purposes is given as  being  in  such
31    municipality.   The  amount  to  be paid to each municipality
32    shall  be  the  amount  (not  including   credit   memoranda)
33    collected  hereunder  during  the  second  preceding calendar
34    month by the Department, and not including an amount equal to
HB1276 Enrolled            -7-                 LRB9203258SMdv
 1    the amount  of  refunds  made  during  the  second  preceding
 2    calendar   month   by   the  Department  on  behalf  of  such
 3    municipality, less the  amount  expended  during  the  second
 4    preceding  month  by  the  Department  to  be  paid  from the
 5    appropriation to the Department from the Home Rule  Municipal
 6    Retailers'  Occupation  Tax Trust Fund.  The appropriation to
 7    cover the costs incurred by the Department  in  administering
 8    and  enforcing this Section shall not exceed 2% of the amount
 9    estimated to  be  deposited  into  the  Home  Rule  Municipal
10    Retailers'  Occupation  Tax Trust Fund during the fiscal year
11    for which the appropriation is made.  Within  10  days  after
12    receipt   by   the  State  Comptroller  of  the  disbursement
13    certification to the  municipalities  provided  for  in  this
14    Section   to  be  given  to  the  State  Comptroller  by  the
15    Department, the State Comptroller shall cause the  orders  to
16    be  drawn  for  the respective amounts in accordance with the
17    directions contained in that certification.
18        Any ordinance imposing or discontinuing  any  tax  to  be
19    collected  and  enforced by the Department under this Section
20    shall be adopted and a certified copy thereof filed with  the
21    Department  on  or before October 1, whereupon the Department
22    of Revenue shall  proceed  to  administer  and  enforce  this
23    Section  on behalf of the municipalities as of January 1 next
24    following such adoption and filing.  Beginning April 1, 1998,
25    any  ordinance  imposing  or  discontinuing  any  tax  to  be
26    collected and enforced by the Department under  this  Section
27    shall  either  (i)  be  adopted  and a certified copy thereof
28    filed with the Department on or before April 1, whereupon the
29    Department of Revenue shall proceed to administer and enforce
30    this Section on behalf of the municipalities  as  of  July  1
31    next  following  the  adoption and filing; or (ii) be adopted
32    and a certified copy thereof filed with the Department on  or
33    before  October  1, whereupon the Department of Revenue shall
34    proceed to administer and enforce this Section on  behalf  of
HB1276 Enrolled            -8-                 LRB9203258SMdv
 1    the  municipalities  as  of  January  1  next  following  the
 2    adoption and filing.
 3        Nothing  in this subsection (c) shall prevent a home rule
 4    municipality from collecting the tax pursuant  to  subsection
 5    (a)  in  any situation where such tax is not collected by the
 6    Department of Revenue under this subsection (c).
 7        (d)  Any unobligated balance remaining in  the  Municipal
 8    Retailers'  Occupation  Tax  Fund on December 31, 1989, which
 9    fund was abolished by Public Act 85-1135, and all receipts of
10    municipal tax as a result  of  audits  of  liability  periods
11    prior  to  January  1,  1990,  shall  be  paid into the Local
12    Government Tax Fund, for distribution  as  provided  by  this
13    Section  prior  to  the  enactment of Public Act 85-1135. All
14    receipts of municipal tax as a result of  an  assessment  not
15    arising from an audit, for liability periods prior to January
16    1, 1990, shall be paid into the Local Government Tax Fund for
17    distribution before July 1, 1990, as provided by this Section
18    prior  to  the  enactment  of  Public Act 85-1135, and on and
19    after July 1, 1990, all such receipts shall be distributed as
20    provided in Section 6z-18 of the State Finance Act.
21        (e)  As   used   in   this   Section,   "Municipal"   and
22    "Municipality" means a city, village  or  incorporated  town,
23    including  an  incorporated town which has superseded a civil
24    township.
25        (f)  This Section shall be known and may be cited as  the
26    Home Rule Municipal Use Tax Act.
27    (Source: P.A. 91-51, eff. 6-30-99; 92-221, eff. 8-2-01.)

28        Section  90.  The State Mandates Act is amended by adding
29    Section 8.26 as follows:

30        (30 ILCS 805/8.26 new)
31        Sec. 8.26. Exempt mandate.   Notwithstanding  Sections  6
32    and  8 of this Act, no reimbursement by the State is required
HB1276 Enrolled            -9-                 LRB9203258SMdv
 1    for  the  implementation  of  any  mandate  created  by  this
 2    amendatory Act of the 92nd General Assembly.

 3        Section 99.  Effective date.  This Act takes effect  upon
 4    becoming law.

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