Section 520.1600  Definitions

The following definitions are applicable to Subpart P.

"Act" means Sections 1i and 1j of the Retailers' Occupation Tax Act [35 ILCS 120/li and lj].

"Business enterprise", for the purpose of determining whether the minimum  eligible investment has been made at the High Impact Service Facility, means the taxpayer and any related corporation. For purposes of this definition, related corporation includes any wholly-owned subsidiary of the taxpayer, any corporation that wholly owns the taxpayer, or any corporation that is wholly-owned by the same common parent corporation as the taxpayer.

"Business enterprise project" means a facility used primarily for the sorting, handling and redistribution of mail, freight, cargo or other parcels received from agents or employees of the handler or shipper for processing at a common location and redistribution to other employees or agents for delivery to an ultimate destination on an item-by-item basis, and that consists of an investment of $100 million or more and will cause the creation of 750 or more jobs in an Enterprise Zone established pursuant to the Illinois Enterprise Zone Act and certified by the Department.

"Contractually obligated" means the business enterprise has entered into a legally binding agreement with the Department to comply with Section 1i of the Retailers' Occupation Tax Act.

"Department" means the Department of Commerce and Community Affairs.

"Eligible investment" means:

Investments in qualified property that will be placed in service at a High Impact Service Facility located in an Enterprise Zone. Qualified properties are statutorily defined in Section 201(f) and (h) of the Illinois Income Tax Act [35 ILCS 5/201(f) and (h)]; or

Noncapital/nonroutine investments, and associated service costs (direct labor or contractual fees), that will be placed in service at a High Impact Service Facility located in an Enterprise Zone and made for the improvement or renovation of qualified properties. These activities are undertaken for the purposes of improving productive capacity, efficiency, product quality, or competitive position, and cannot be repetitious, commonplace, or associated with regular maintenance expenditures; or

Includes motor driven heavy equipment, not considered rolling stock, used for transporting parcels, machinery, or equipment, or is used to maintain and provide in-house services within the confines of the facility; and automated machinery and equipment used for the purposes of transporting parcels within the facility, along with all components contained in the electronic control systems.

"Full-time employee" means a person, employed by the taxpayer or any wholly-owned subsidiary of the taxpayer, who works a minimum of 35 hours per week for 52 weeks for a minimum total of 1,820 hours per year. Vacations, paid holidays, and sick time are included in this computation. Overtime is not considered a part of regular hours.

"Full-time equivalent job" means the number of employees required to equal one full-time employee employed at the High Impact Service Facility. For purposes of this definition, employee means a person employed by the taxpayer, any wholly-owned subsidiary of the taxpayer, any corporation that wholly owns the taxpayer, or any corporation that is wholly-owned by the same common parent corporation as the taxpayer, irrespective of the number of hours per week or number of weeks per year worked by such person.

"High Impact Service Facility" means a facility used primarily for the sorting, handling, and redistribution of mail, freight, cargo, or other parcels received from agents or employees of the handler or shipper for processing at a common location and redistribution to other employees or agents for delivery to an ultimate destination on an item-by-item basis [35 ILCS 120/li].

"Job creation" means at least 750 or more full-time equivalent employees have been hired in an Enterprise Zone over the number of full-time equivalent employees that were employed by the applicant in the Enterprise Zone as of July 1, 1989 or the date the Enterprise Zone was certified, whichever is later. Job titles being filled or refilled as a result of strikes or layoffs or replacement workers to replace company locked out employees cannot be counted as job creation.

"Placed in service" means the state or condition of readiness and availability for a specifically assigned function as defined in 26 CFR 1.167(a)-11, Code of Federal Regulations Vol. 2, April 1, 2001. An eligible investment, as defined in this Section, shall be considered placed in service on the earlier of:

The date the property is placed in a condition of readiness and availability for use; or

The date on which the depreciation period of that property begins.

(Source:  Added at 27 Ill. Reg. 3282, effective February 14, 2003)