Section 125.20  Definitions

 

The following definitions are applicable to this Part.

 

"Act" means the Invest in Illinois Act [30 ILCS 751].

 

"Agreement" means an agreement between an applicant and the Department pursuant to this Part and Section 30 of the Act.

 

"Applicant" means a taxpayer that operates or plans to operate an eligible business in the State.

 

"Business" means a sole proprietorship, partnership, corporation, or limited liability company.

 

"Capital improvement" means:

 

i)          the purchase, renovation, rehabilitation, or construction, at an approved project site in the State, of land, buildings, structures, equipment, or furnishings; and

 

ii)         goods or services that are normally capitalized, including organizational costs and research and development costs incurred in Illinois. "Capital improvement" does not include land, buildings, structures, and equipment that are leased, unless the term of the lease equals or exceeds the term of the agreement. For land, buildings, structures, and equipment that are leased and are considered capital improvements, the cost of the property shall be determined from the present value of the lease payments, using the corporate interest rate prevailing at the time of the application.

 

"Capital investment" means the expenditure of money for capital improvements.

 

"Department" means the Department of Commerce and Economic Opportunity. [30 ILCS 751]

 

"Domestic bank" shall mean any branch or office within the United States of any of the following which is not a national of a designated foreign country; any bank or trust company incorporated under the banking laws of the United States or any State, territory, or district of the United States, or any private bank or banker subject to supervision and examination under the banking laws of the United States or of any State, territory or district of the United States.

 

"Director" means the Director of the Department of Commerce and Economic Opportunity.

 

"Full-time employee" means an individual who is employed for consideration for at least 35 hours each week or who renders any other standard of service generally accepted by industry custom or practice as full-time employment. Annually scheduled periods for inventory or repairs, vacations, holidays, and paid time for sick leave, vacation, or other leave shall be included in this computation of full-time employment. An individual for whom a W-2 is issued by a Professional Employer Organization is a full-time employee if employed in the service of the applicant for consideration for at least 35 hours each week. [30 ILCS 751]

 

"Performance Condition" means any term, provision, or clause of the agreement that the awardee must comply with before receiving an award.

 

"Project" means for-profit economic development activity or activities at a single site. For-profit economic development activity or activities of one or more taxpayers at multiple sites may be considered a project if the economic activities are vertically integrated and designated by the Department as a project and as the subject of an agreement that includes capital improvement requirements and job creation requirements and, if applicable, job retention requirements for the project location or locations. The employees subject to the agreement must be assigned to a specific project location and work there as their primary location.

 

"Taxpayer" means a business that is subject to any tax or fee collected by the Department of Revenue or that will be subject to any tax or fee collected by the Department of Revenue upon the location of the business in the State. [30 ILCS 751]

 

Section 125.30  Eligibility

 

a)         The Department may make non-competitive economic incentive awards, including, but not limited to, grants and loans, to assist applicants that pledge to make capital investments and create new jobs in this State or retain jobs in this State. "Non-competitive" means the Department determines the recipient of the award and is not required to follow a competitive application process. [30 ILCS 751/15(a)]

 

b)         To qualify for an incentive award, the applicant must:

 

1)         be in good standing under the laws of this State and the laws of all other states where the applicant was formed or is organized; and

 

2)         owe no delinquent taxes to the State of Illinois.

 

c)         The Department may not award an incentive award to an applicant that:

 

1)         closes operations at one location in the State or reduces those operations by more than 50% within the last 12 months; and

 

2)         relocates substantially the same operations to another location in the State.

 

This prohibition does not apply if the applicant moves its operations from one location in the State to another location in the State for the purpose of expanding its operations in the State and the Department determines that expansion could not reasonably be accommodated within the municipality or county where the business was located prior to the relocation. In making its determination, the Department shall confer with the chief executive officer of the municipality or county where the business was located prior to the relocation and take into consideration any evidence offered by the municipality or county regarding its ability to accommodate expansion within the municipality or county. [30 ILCS 751/15(c)]

 

d)         The Department shall only disburse the award to the applicant's domestic bank.

 

Section 125.40  Form of Application

 

An applicant seeking an economic incentive under this Act shall submit a detailed application to the Department. [30 ILCS 751/20] The application will be provided by the Department. The application shall contain:

 

a)         the location of the project;

 

b)         the amount of the capital investment the applicant will make in the project;

 

c)         the number of new jobs that will be created as a result of the project;

 

d)         the number of jobs retained by an existing applicant; and

 

e)         the average salary of the jobs to be created or retained. [30 ILCS 751/20]

 

Section 125.50  Application Review

 

The Department shall determine which projects will benefit the State and are eligible to receive an award. In making this determination, the Department will consider:

 

a)         the number of jobs to be created by the project;

 

b)         the number of jobs to be retained by the project;

 

c)         the average salary of jobs created by the project;

 

d)         the average salary of jobs retained by the project;

 

e)         the total capital investment to be made by the applicant;

 

f)         the likelihood of other businesses locating within the same vicinity or within the State as a result of the business activity to be conducted by the applicant receiving the economic incentive;

 

g)         the impact on the economy of the area or community where the project is located; and

 

h)         any other factors the Department determines to be relevant to the goals established in the purpose statement of the Act. [30 ILCS 751/25]

 

Section 125.60  Incentive Agreement

 

The Department and each taxpayer whom the Department determines qualifies for an incentive under the Act shall enter into an agreement that specifies terms and conditions regarding the provision of the incentive and defines the rights and responsibilities of the taxpayer and the Department. Provisions that the taxpayer will be contractually bound to comply with include, but are not limited to, the following:

 

a)         a detailed description of the project that is the subject of the agreement;

 

b)         the performance conditions that must be met to obtain the award, including, but not limited to, the number of new jobs created or retained, the average salary of the new jobs created, and the total capital investment;

 

c)         the schedule of payments;

 

d)         a requirement that the awardee maintain operations at the project location for a minimum number of years;

 

e)         a specific method for determining the number of new employees and, if applicable, the number of retained employees, to be employed during each taxable year covered by the agreement;

 

f)         a requirement that the awardee annually report to the Department the number of new employees and any other information the Department deems necessary and appropriate to perform its duties under this Act;

 

g)         a detailed description of the number of new employees to be hired and the occupation and payroll of full-time jobs to be created or retained because of the project;

 

h)         the minimum capital investment the awardee will make, the time period for placing the property in service, and the designated location in Illinois for the capital investment;

 

i)          a requirement that the awardee provide written notice to the Director and the Director's designee not more than 30 days after the awardee determines that the minimum job creation, job retention, employment payroll, or capital investment is no longer or will no longer be achieved or maintained as required in the agreement and include in that notice the number of layoffs, the date of the layoffs, and the awardee's efforts to provide career and training counseling to the impacted workers with industry-related certifications and trainings;

 

j)          a claw-back provision, pursuant to Section 125.180, to recapture the award, in whole or in part, for failure to comply with the agreement; and

 

k)         a provision that the agreement shall not take effect, nor may any funds be expended or transferred under the agreement, if the Department fails to comply with the notification requirements under Section 32 of the Act and under Subpart E of these rules, or if the Speaker of the House of Representatives or the Senate President (or their designees, if applicable) submit a letter of rejection. [30 ILCS 751/30]

 

Section 125.70  Noncompliance with the Agreement

 

a)         If the Department determines that a taxpayer is not complying with the terms of the agreement, then the applicant may be required to repay some or all of the award along with any applicable interest to the State at the agreed upon rate and on the agreed terms set forth in the agreement. The amount of the incentive that the applicant will be required to repay shall be set forth in the agreement.

 

b)         In addition to the rights of the Department set forth in subsection (a), if the taxpayer fails to comply with any of the other terms of the agreement, the Department may:

 

1)         obtain a lien or other interest in the capital improvements in proportion to the percentage of the incentive amount used to pay for those capital improvements; and

 

2)         If the taxpayer sells the capital improvements, require the taxpayer to:

 

A)        repay to the State the funds used to pay for the capital improvement, with interest at the rate and according to the other terms provided by the agreement; and

 

B)        share with the State a proportionate amount of any profit realized from the sale