100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB5618

 

Introduced , by Rep. Sonya M. Harper

 

SYNOPSIS AS INTRODUCED:
 
See Index

    Amends the Illinois Municipal Code. Provides that a municipality may create urban agricultural zones (UAZ) composed of organizations or persons who grow produce or other agricultural products; who raise livestock or poultry; who process livestock or poultry; or that sell a minimum of 75% locally grown food. Provides for the creation of a UAZ board to advise the corporate authorities of a municipality on UAZs. Provides for UAZ application requirements, including the number of jobs to be created, the types of products to be produced, and if applying for a vending UAZ, the ability to accept food stamps under the provisions of the Supplemental Nutrition Assistance Program if selling products to consumers, the geographic description of the area that will be included in the UAZ, and other requirements. Provides for public hearing and notice requirements before adoption of an ordinance to establish a UAZ. Provides that property taxes on property that is used for growing or raising of agricultural products located within a UAZ shall not be increased, if authorized in the UAZ ordinance, for a period of up to 25 years. Provides that sales tax amounts received from the sale of agricultural products grown or produced in a UAZ shall be deposited in the Urban Agricultural Zone Fund and specifies distribution to the municipality or school districts under specified circumstances. Allows for wholesale water rates and a reduction in water connection charges for water users who grow or raise agricultural products in the UAZ. Amends the State Finance Act by making conforming changes. Effective immediately.


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FISCAL NOTE ACT MAY APPLY
HOUSING AFFORDABILITY IMPACT NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB5618LRB100 19851 AWJ 35943 b

1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The State Finance Act is amended by adding
5Section 5.886 as follows:
 
6    (30 ILCS 105/5.886 new)
7    Sec. 5.886. The Urban Agricultural Zone Fund.
 
8    Section 10. The Illinois Municipal Code is amended by
9adding Division 15.4 to Article 11 as follows:
 
10    (65 ILCS 5/Art. 11 Div. 15.4 heading new)
11
DIVISION 15.4. MUNICIPAL URBAN AGRICULTURAL ZONES

 
12    (65 ILCS 5/11-15.4-5 new)
13    Sec. 11-15.4-5. Definitions. As used in this Division:
14    "Agricultural product" means an agricultural,
15horticultural, viticultural, or vegetable product either in
16its natural or processed state, that has been produced,
17processed, or otherwise had value added to it in this State.
18"Agricultural product" includes, but is not limited to, growing
19of grapes that will be processed into wine; bees; honey; fish
20or other aquacultural product; planting seed; livestock or

 

 

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1livestock product; forestry product; and poultry or poultry
2product.
3    "Aquaculture" and "aquatic products" have the meanings
4given to those terms in Section 4 of the Aquaculture
5Development Act.
6    "Blighted area" means that portion of a municipality within
7which the corporate authorities of the municipality determines
8that by reason of age, obsolescence, inadequate or outmoded
9design, or physical deterioration have become economic and
10social liabilities, and that these conditions are conducive to
11ill health, transmission of disease, crime, or inability to pay
12reasonable taxes. "Blighted area" does not include farmland
13assessed under Section 10-110 of the Property Tax Code.
14    "Department" means the Department of Agriculture.
15    "Domesticated animal" means cattle; calves; sheep; swine;
16ratite birds, including, but not limited to, ostrich and emu;
17llamas; alpaca; buffalo; elk documented as obtained from a
18legal source and not from the wild; goats; horses and other
19equines; or rabbits raised in confinement for human
20consumption.
21    "Grower UAZ" means a type of UAZ:
22        (1) that can either grow produce, raise livestock, or
23    produce other value-added agricultural products; and
24        (2) that does not exceed 50 laying hens, 650 broiler
25    chickens, or 30 domesticated animals.
26    "Livestock" means cattle; calves; sheep; swine; ratite

 

 

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1birds including but not limited to ostrich and emu; aquatic
2products obtained through aquaculture; llamas; alpaca;
3buffalo; elk documented as obtained from a legal source and not
4from the wild; goats; horses and other equines; or rabbits
5raised in confinement for human consumption.
6    "Locally grown" means a product that was grown or raised in
7the same county or adjoining county in which the UAZ is
8located.
9    "Meat" means any edible portion of livestock or poultry
10carcass.
11    "Meat product" means anything containing meat intended for
12or capable of use for human consumption, which is derived, in
13whole or in part, from livestock or poultry.
14    "Poultry" means any domesticated bird intended for human
15consumption.
16    "Processing UAZ" means a type of UAZ:
17        (1) that processes livestock or poultry for human
18    consumption;
19        (2) that meets federal and State processing laws and
20    standards; or
21        (3) that is a qualifying small business approved by the
22    Department.
23    "Public colleges and universities" has the meaning given to
24that term in Section 5 of the Higher Education Veterans Service
25Act.
26    "Qualifying small business" means those enterprises which

 

 

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1are established within an Urban Agricultural Zone subsequent to
2its creation, and which meet the definition established for the
3federal Small Business Administration and set forth in Section
4121.301 of Part 121 of Title 13 of the Code of Federal
5Regulations.
6    "Sales tax amounts" means the amount of taxes paid under
7the Retailers' Occupation Tax Act, the Use Tax Act, the Service
8Use Tax Act, the Service Occupation Tax Act, the Municipal
9Retailers' Occupation Tax Act, and the Municipal Service
10Occupation Tax Act by retailers and servicemen on transactions
11at places located in a UAZ.
12    "Urban agricultural zone" or "UAZ" means a zone within a
13metropolitan statistical area, as defined by the United States
14Office of Budget and Management, which has one or more of the
15following entities that is a qualifying small business, and
16approved by the Department, as follows:
17        (1) any organization or person who grows produce or
18    other agricultural products;
19        (2) any organization or person that raises livestock or
20    poultry;
21        (3) any organization or person who processes livestock
22    or poultry; or
23        (4) any organization that sells at a minimum 75%
24    locally grown food.
25    "Value-added agricultural products" means any product or
26products that are the result of:

 

 

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1        (1) using an agricultural product grown in this State
2    to produce a meat or dairy product in this State;
3        (2) a change in the physical state or form of the
4    original agricultural product;
5        (3) an agricultural product grown in this State which
6    has had its value enhanced by special production methods
7    such as organically grown products; or
8        (4) a physical segregation of a commodity or
9    agricultural product grown in this State that enhances its
10    value such as identity preserved marketing systems.
11    "Vending UAZ" means a type of UAZ:
12        (1) that sells produce, meat, or locally grown
13    value-added agricultural products;
14        (2) that is able to accept food stamps under the
15    provisions of the Supplemental Nutrition Assistance
16    Program as a form of payment; and
17        (3) that is a qualifying small business that is
18    approved by the Department for a UAZ vendor license.
 
19    (65 ILCS 5/11-15.4-10 new)
20    Sec. 11-15.4-10. Urban agricultural zone board.
21    (a) The corporate authorities of a municipality planning to
22seek designation of an urban agricultural zone shall establish
23an urban agricultural zone board. There shall be 7 members on
24the board. One member of the board shall be appointed by the
25school district or districts located within the area proposed

 

 

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1for designation as an urban agricultural zone. Two members of
2the board shall be appointed by other affected taxing units of
3local government. The remaining 4 members shall be appointed by
4the president or mayor of the municipality. The 4 members
5chosen by the president or mayor shall all be residents of the
6municipality in which the UAZ is to be located, and at least
7one of the 4 members shall have experience in or represent an
8organization associated with sustainable agriculture, urban
9farming, community gardening, or any of the activities or
10products authorized by this Division for UAZs.
11    (b) The school district member and the 2 affected taxing
12unit of local government members shall each have initial terms
13of 5 years. Of the 4 members appointed by the president or
14mayor, 2 shall have initial terms of 4 years, and 2 shall have
15initial terms of 3 years. Thereafter, members shall serve terms
16of 5 years. Each member shall hold office until a successor has
17been appointed. All vacancies shall be filled in the same
18manner as the original appointment. For inefficiency, neglect
19of duty, or misconduct in office, a member of the board may be
20removed by the applicable appointing authority.
21    (c) The members of the board annually shall elect a chair
22from among the members.
23    (d) A majority of the members shall constitute a quorum of
24the board for the purpose of conducting business and exercising
25the powers of the board and for all other purposes. Action may
26be taken by the board upon a vote of a majority of the members

 

 

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1present.
2    (e) The role of the board shall be to conduct the
3activities necessary to advise the corporate authorities of the
4municipality on the designation of an urban agricultural zone
5and any other advisory duties as determined by the corporate
6authorities of the municipality. The role of the board after
7the designation of an urban agricultural zone shall be review
8and assessment of zone activities.
 
9    (65 ILCS 5/11-15.4-15 new)
10    Sec. 11-15.4-15. Application for an urban agricultural
11zone; review; dissolution.
12    (a) A person or organization may submit to the municipal
13clerk an application to develop a UAZ in a blighted area. The
14application shall demonstrate or identify:
15        (1) if the person or organization is a grower UAZ,
16    processing UAZ, vending UAZ, or a combination of all three
17    types of UAZs in which case the person or organization
18    shall meet the requirements of each type of UAZ in order to
19    qualify;
20        (2) the number of jobs to be created;
21        (3) the types of products to be produced;
22        (4) if applying for a vending UAZ, the ability to
23    accept food stamps under the provisions of the Supplemental
24    Nutrition Assistance Program if selling products to
25    consumers;

 

 

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1        (5) the geographic description of the area that will be
2    included in the UAZ;
3        (6) all taxing units of local government impacted by
4    the proposed UAZ; and
5        (7) the amount of property taxes to be abated, if any,
6    under Section 11-15.4-25, including which taxing units of
7    local government would be impacted by the abatement.
8    (b) A municipality shall review and modify the application
9as necessary before either approving or denying the request to
10establish a UAZ.
11    (c) Approval of the UAZ by a municipality shall be reviewed
125 and 10 years after the development of the UAZ. After 25
13years, the UAZ shall dissolve. If the municipality finds during
14its review that the UAZ is not meeting the requirements set out
15in this Division, the municipality may dissolve the UAZ by
16ordinance or resolution.
 
17    (65 ILCS 5/11-15.4-20 new)
18    Sec. 11-15.4-20. Notice and public hearing; urban
19agricultural zone ordinance. Prior to the adoption of an
20ordinance designating an urban agricultural zone, the urban
21agricultural zone board shall fix a time and place for a public
22hearing and notify each taxing unit of local government located
23wholly or partially within the boundaries of the proposed urban
24agricultural zone. The board shall send, by certified mail, a
25notice of the hearing to all taxing units of local government

 

 

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1and shall publish notice of such hearing in a newspaper of
2general circulation in the area to be affected by the
3designation at least 20 days prior to the hearing but not more
4than 30 days prior to the hearing. The notice shall state the
5time, location, date, and purpose of the hearing. At the public
6hearing, any interested person or affected taxing unit of local
7government may file with the board written objections or
8comments and may be heard orally in respect to, any issues
9embodied in the notice. The board shall hear and consider all
10objections, comments, and other evidence presented at the
11hearing. The hearing may be continued to another date without
12further notice other than a motion to be entered upon the
13minutes fixing the time and place of the subsequent hearing.
14    Following the conclusion of the public hearing required
15under this Section, the corporate authorities of the
16municipality may adopt an ordinance designating an urban
17agricultural zone.
 
18    (65 ILCS 5/11-15.4-25 new)
19    Sec. 11-15.4-25. Taxation of property; water rates and
20charges.
21    (a) If authorized by the urban agricultural zone ordinance
22under Section 11-15.4-20, real property located within a UAZ
23that is used for growing or raising of agricultural products is
24not subject to assessment or payment of ad valorem taxes on
25real property imposed by the State or units of local government

 

 

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1specified in the ordinance for a period of tax abatement of up
2to 25 years as specified by ordinance under Section 11-15.4-20
3except in an amount not greater than the amount of taxes
4assessed in the levy year immediately preceding the levy year
5during which the UAZ was designated. The amounts of the tax
6assessed used for growing or raising of agricultural products
7may not be increased during the period stated in the ordinance
8as long as the real property is used in furtherance of the
9activities provided under this Division. At the conclusion of
10the period of abatement provided by the ordinance, the property
11used for growing or raising of agricultural products shall then
12be reassessed. If only a portion of real property is used as a
13UAZ, then only that portion of real property shall be exempt
14from assessment or payment of ad valorem taxes on the property
15as provided by this Section. Parcels of property assessed under
16Section 10-110 of the Property Tax Code are not eligible for
17the abatement provided in this subsection (a).
18    (b) Any sales tax amounts received from the sale of
19agricultural products grown or produced and sold in the UAZ
20shall be deposited in the Urban Agricultural Zone Fund
21established in Section 11-15.4-30 of this Division. An amount
22equal to 1% shall be retained by the Director of the Department
23of Revenue for deposit in the General Revenue Fund to offset
24the costs of collection.
25    (c) Any entity providing water to the UAZ may authorize a
26water user who grows or raises agricultural products in the UAZ

 

 

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1to (1) pay wholesale water rates, if available, or (2) pay 50%
2of the standard connection charge.
 
3    (65 ILCS 5/11-15.4-30 new)
4    Sec. 11-15.4-30. The Urban Agricultural Zone Fund.
5    (a) The Urban Agricultural Zone Fund, a special fund
6created in the State treasury, shall consist of moneys
7collected under Section 5-45025 of Article 5 of the Counties
8Code and Section 11-15.4-25 of this Division. Except as
9provided for in subsection (b), the Comptroller shall order
10transferred before the end of each quarter of the fiscal year,
11and the Treasurer shall transfer, an amount equal to the moneys
12collected from the municipal UAZs within the previous quarter.
13    (b) A school district or school districts that have a UAZ
14in their district territory may apply to the Department for
15money in the fund to be used for the development of curriculum
16on or the implementation of urban farming practices under the
17guidance of a public college or university. The funds are to be
18distributed on a competitive basis within the school district
19or districts in which the UAZ is located pursuant to rules
20published by the Department, with special consideration given
21to the relative number of students eligible for free and
22reduced-price lunches attending the schools within the
23district or districts. The Department may designate up to 10%
24of moneys from quarterly sales tax amounts in the Agricultural
25Zone Fund to school districts under this subsection (b). The

 

 

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1Department shall notify the Comptroller of any moneys awarded
2to a school district under this subsection (b) no later than 14
3days before the end of each quarter and the Comptroller shall
4reduce the amount ordered transferred to the municipality by
5that amount.
 
6    (65 ILCS 5/11-15.4-35 new)
7    Sec. 11-15.4-35. Severability. The provisions of this
8Division are severable under Section 1.31 of the Statute on
9Statutes.
 
10    Section 99. Effective date. This Act takes effect July 1,
112017.

 

 

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1 INDEX
2 Statutes amended in order of appearance
3    30 ILCS 105/5.886 new
4    65 ILCS 5/Art. 11 Div.
5    15.4 heading new
6    65 ILCS 5/11-15.4-5 new
7    65 ILCS 5/11-15.4-10 new
8    65 ILCS 5/11-15.4-15 new
9    65 ILCS 5/11-15.4-20 new
10    65 ILCS 5/11-15.4-25 new
11    65 ILCS 5/11-15.4-30 new
12    65 ILCS 5/11-15.4-35 new