Public Act 93-0533

HB0860 Enrolled                      LRB093 05730 SJM 05823 b

    AN ACT in relation to taxes.

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

    Section  5.  The Property Tax Code is amended by changing
Sections 10-235, 10-245, and 10-250 as follows:

    (35 ILCS 200/10-235)
    Sec.  10-235.  Section  515  Low-income  housing  project
valuation policy; intent. It is the policy of this State that
low-income housing projects that qualify for  the  low-income
housing  tax  credit under Section 42 of the Internal Revenue
Code under Section 515 of the federal Housing  Act  shall  be
valued  at  33 and one-third percent of the fair market value
of their economic productivity to the owners of the  projects
to  help  insure  that  their valuation for property taxation
does not result in taxes so high that  rent  levels  must  be
raised  to cover this project expense, which can cause excess
vacancies, project loan defaults, and eventual loss of rental
housing facilities for those most in need of them, low-income
families and the elderly.  It is the  intent  of  this  State
that  the  valuation required by this Division is the closest
representation of cash value  required  by  law  and  is  the
method established as proper and fair.
(Source: P.A. 91-651, eff. 1-1-00; 92-16, eff. 6-28-01.)

    (35 ILCS 200/10-245)
    Sec.   10-245.   Method   of  valuation  of  Section  515
low-income housing projects.   Notwithstanding  Section  1-55
and except in counties with a population of more than 200,000
that  classify  property  for  the  purposes  of taxation, to
determine 33 and one-third percent of the fair cash value  of
any Section 515 low-income housing project that qualifies for
the  low-income  housing  tax  credit under Section 42 of the
Internal  Revenue  Code,  in  assessing  the  project,  local
assessment officers must consider the actual or probable  net
operating income attributable to the project, using a vacancy
rate of not more than 5%, capitalized at normal market rates.
The  interest rate to be used in developing the normal market
value capitalization rate shall  be  one  that  reflects  the
prevailing  cost  of  cash for other types of commercial real
estate in the  geographic  market  in  which  the  low-income
housing Section 515 project is located.
(Source: P.A. 91-651, eff. 1-1-00; 91-884, eff. 6-30-00.)

    (35 ILCS 200/10-250)
    Sec.  10-250.  Certification procedure and effective date
of implementation.
    (a)  After  (i)  an  application  for   a   Section   515
low-income  housing  project  certificate  is  filed with the
State Director of the United States Department of Agriculture
Rural Development Office in a manner and form  prescribed  in
regulations  issued by the office and (ii) the certificate is
issued  certifying  that  the  housing  is  a   Section   515
low-income  housing  project  as defined in Section 2 of this
Act, the certificate must be  presented  to  the  appropriate
local  assessment  officer to receive the property assessment
valuation under this Division. The local  assessment  officer
must  assess the property according to this Act. Beginning on
January 1, 2000 and through taxable year 2003, all  certified
Section  515 low-income housing projects shall be assessed in
accordance with Section 10-245.
    (b) Beginning with  taxable  year  2004,  all  low-income
housing  projects that qualify for the low-income housing tax
credit under Section 42 of the Internal Revenue Code shall be
assessed in accordance with Section 10-245 if  the  owner  or
owners  of  the  low-income  housing  project  certify to the
appropriate local assessment officer that the owner or  owner
that  qualifies  for  the low-income housing tax credit under
Section 42 of the Internal Revenue Code for the property.
(Source: P.A. 91-651, eff. 1-1-00; 91-884, eff. 6-30-00.)

    Section 99.  Effective date.  This Act  takes  effect  on
January 1, 2004.