SB2445 102ND GENERAL ASSEMBLY

LRB102 17214 HLH 22672 b

102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
SB2445

Introduced 2/26/2021, by Sen. Mattie Hunter - Ann Gillespie - Sara Feigenholtz

SYNOPSIS AS INTRODUCED:

New Act
20 ILCS 3805/13.1 new
35 ILCS 5/232 new
35 ILCS 120/5m new
35 ILCS 200/15-178 new
215 ILCS 5/409	from Ch. 73, par. 1021
215 ILCS 5/444	from Ch. 73, par. 1056
310 ILCS 67/15
310 ILCS 67/25
310 ILCS 67/50
310 ILCS 67/70 new

Creates the Build Illinois Homes Tax Credit Act. Provides that owners of qualified low-income housing developments are eligible for credits against (i) State income taxes and (ii) any privilege tax or retaliatory tax, penalty, fee, charge, or payment imposed under the Illinois Insurance Code. Amends the Illinois Housing Development Act. Provides that the Illinois Housing Development Authority shall develop a form and include it with certain financing agreements. Amends the Retailers' Occupation Tax Act. Creates an exemption for building materials to be incorporated into an 100% affordable housing project by rehabilitation or new construction. Amends the Property Tax Code. Provides for a reduction in assessed value for affordable rental housing construction or rehabilitation. Amends the Affordable Housing Planning and Appeal Act. Provides that an affordable housing plan, or any revision thereof, shall not be adopted by a non-exempt local government until notice and opportunity for public hearing have first been afforded. Makes other changes. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

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

Article 1. Build Illinois Homes Tax Credit Act

Section 1-1. Short title. This Act may be cited as the Build Illinois Homes Tax Credit Act. References in this Article to "this Act" mean this Article.

Section 1-5. Definitions. As used in this Act, unless the context clearly requires otherwise:

"Allocation" means an award of tax credits to the owner of a qualified development in any allocation round, to be claimed ratably annually over the credit period.

"Allocation round" means all allocations by the Authority of credits under this Act to qualified developments in any calendar year.

"Allocation schedule certification" means the certification issued by the owner of a qualified development or its designee pursuant to subsection (d) of Section 1-10 of this Act.

"Authority" means:

(1) the Illinois Housing Development Authority; or

(2) the City of Chicago Department of Housing.

"Credit" means the credit allowed pursuant to this Act.

"Credit period" means the period of 10 taxable years beginning with the taxable year in which a qualified development is placed in service. If a qualified development consists of more than one building, the qualified development is deemed to be placed in service in the taxable year during which the last building of the qualified development is placed in service.

"Department" means the Department of Revenue.

"Federal tax credit" means the federal low-income housing tax credit provided by Section 42 of the federal Internal Revenue Code, including federal low-income housing tax credits issued pursuant to 26 U.S.C. 42(h)(3) and 26 U.S.C. 42(h)(4).

"Qualified allocation plan" means the qualified allocation plan adopted by the Authority pursuant to Section 42(m) of the federal Internal Revenue Code of 1986.

"Qualified basis" means the qualified basis of the qualified development as determined pursuant to Section 42 of the federal Internal Revenue Code of 1986.

"Qualified development" means a qualified low-income housing project, as that term is defined in Section 42 of the federal Internal Revenue Code of 1986, that is located in the State and is determined to be eligible for the federal tax credit set forth in Section 42 of the Internal Revenue Code, whether or not a federal tax credit is allocated with respect to that qualified development.

"Qualified taxpayer" means an individual, person, firm, corporation, or other entity that owns an interest, direct or indirect, in a qualified development and is subject to any or all of the following: (i) the taxes imposed by the Illinois Income Tax Act; or (ii) any privilege tax or retaliatory tax, penalty, fee, charge or payment imposed by the Illinois Insurance Code.

"State credit eligibility statement" means a statement issued by the Authority under Section 1-7.

"State tax return" means the income tax return filed with the Department or the privilege and retaliatory tax return filed with the Department of Insurance, as applicable.

Section 1-7. State credit eligibility statements. A State credit eligibility statement shall be issued by the Authority with respect to each building within the qualified development following construction or rehabilitation of the qualified development certifying that each such building within that qualified development qualifies for the credit and specifying:

(1) the calendar year in which the last building of the qualified development was placed in service;

(2) the amount of the credit allowed for each year of the credit period;

(3) the maximum qualified basis of the qualified development taken into account in determining such annual credit amount; and

(4) a unique identification number for each State credit eligibility statement issued.

The State credit eligibility statement shall be issued by the Authority simultaneously with IRS Form 8609 if the qualified development was also allocated federal tax credits.

The State credit eligibility statement shall include a Section to be completed by the owner of the qualified development annually for each year of the credit period certifying that the qualified development was in conformance with all compliance requirements. That certification shall be filed with the project owner's State tax return annually of each year of the credit period.

Section 1-10. Credit for low-income housing developments.

(a) The Authority shall include the credit in its annual qualified allocation plan each year until expiration of this Act. Each allocation round shall be simultaneous with allocations of federal tax credits.

(b) For taxable years beginning on or after January 1, 2021, the Authority may allocate a credit to the owner of a qualified development in any allocation round in an amount determined by the Authority, subject to the following guidelines:

(1) the Authority must find that the credit is necessary for the financial feasibility of the qualified development;

(2) the aggregate sum of credits allocated to qualified developments in any allocation round shall not exceed $35,000,000, plus the amount of unallocated credits, if any, from the preceding allocation round, plus the amount of any credit recaptured or otherwise returned to the Authority since the previous allocation round;

(3) of the $35,000,000 annual allocation: (i) 75.5% of the available credits in each allocation round shall be allocated by the Illinois Housing Development Authority, plus any credits the Illinois Housing Development Authority did not allocate from the previous allocation round, plus the amount of any credits recaptured or otherwise returned to the Illinois Housing Development Authority since the previous allocation round; and (ii) 24.5% of the available credits in each allocation round shall be allocated by the City of Chicago Department of Housing, plus any credits the City of Chicago Department of Housing did not allocate from the previous allocation round, plus the amount of any credits recaptured or otherwise returned to the City of Chicago Department of Housing since the previous allocation round; and

(4) unless otherwise provided in this Act, or unless the context clearly requires otherwise, the Authority must determine eligibility for credits and allocate credits in accordance with the standards and requirements set forth in Section 42 of the federal Internal Revenue Code of 1986.

(c) For tax years during the credit period, any qualified taxpayer is allowed a credit as provided in this Act against any or all of the following: (i) the taxes imposed by subsections (a) and (b) of Section 201 of the Illinois Income Tax Act; or (ii) any privilege tax or retaliatory tax, penalty, fee, charge, or payment imposed under the Illinois Insurance Code.

(d) If a taxpayer receiving an allocation of a credit is (i) a corporation that has an election in effect under Subchapter S of the federal Internal Revenue Code, (ii) a partnership, or (iii) a limited liability company that is taxed as a partnership, the credit provided under this Act may be claimed by the shareholders of the corporation, the partners of the partnership, or the members of the limited liability company as such terms are defined under applicable State law in the same manner as those shareholders, partners, or members account for their proportionate shares of the income or losses of the corporation, partnership, or limited liability company, or as provided in the bylaws or other executed agreement of the corporation, partnership, or limited liability company. Credits granted to a partnership, a limited liability company taxed as a partnership, or other multiple owners of property shall be passed through to the partners, members, or owners respectively on a pro rata basis or pursuant to an executed agreement among the partners, members, or owners documenting any alternative distribution method. A qualified taxpayer may claim a credit so long as its direct or indirect interest in the qualified development is acquired prior to the filing of its tax return claiming the credit. On or before February 28th following each year of the credit period, the owner must submit an allocation schedule certification in an electronic format prescribed by the Department and the Department of Insurance to the Department and the Department of Insurance detailing the amount of credit allocated to each qualified taxpayer for the applicable year and whether each qualified taxpayer intends to apply the credit to income tax or insurance premium tax, or the owner must notify the Department and the Department of Insurance that it has assigned the duty of the allocation schedule certification to its designee who must provide such allocation schedule certification to the Department and the Department of Insurance by the deadline. Such allocation schedule certification may be amended in the event the State credit eligibility statement for a project is received after the deadline for filing the allocation schedule certification. Any such amendment shall be filed prior to any taxpayer attempting to claim tax credits associated with the applicable State credit eligibility statement. Each qualified taxpayer is allowed to claim its allocated amount of credit subject to any restrictions set forth in this Section.

(e) No credit may be allocated pursuant to this Act unless the qualified development is the subject of a recorded restrictive covenant requiring the development to be maintained and operated as a qualified development; this requirement for a recorded restrictive covenant may be satisfied by the agreement for an extended low-income housing commitment required for the federal tax credits as defined in Section 42(h)(6)(B) of the federal Internal Revenue Code of 1986.

(f) If, during a taxable year, there is a determination that no recorded restrictive covenant meeting the requirements of subsection (e) was in effect as of the beginning of that year, such determination shall not apply to any period before that year and subsection (e) shall be applied without regard to that determination if the failure is corrected within one year from the date of the determination.

(g) The credit amount may be taken against the taxes imposed by the Illinois Income Tax Act for each taxable year of the credit period. The credit amount may be taken against the taxes, penalties, fees, charges, and payments imposed by the Illinois Insurance Code for each reporting period in the credit period. Any credit amount that exceeds the tax due for a taxable year may be carried forward as a tax credit against payments due for up to 5 taxable years following the tax year to which the credit relates and must be applied first to the earliest reporting periods possible. Credits that are not claimed may not be refunded to the qualified taxpayer.

(h) By January 15, 2022 and by January 15 of each year thereafter, the Authority shall provide to the Department and the Department of Insurance an electronic file containing all data related to all State credit eligibility statements issued during the preceding year in the manner and form as provided by the Department.

Section 1-15. Recapture. If, under Section 42 of the Internal Revenue Code of 1986, a portion of any federal tax credit claimed with respect to a qualified development is required to be recaptured during the first 10 years after a project is placed in service, then the Authority shall provide written notice, upon a form created by the Authority, to the Department and the Department of Insurance of the amount to be recaptured. The amount of credit subject to recapture shall be proportionately equal to the amount of the qualified development's federal tax credits which are subject to recapture. The Department and the Department of Insurance, as applicable, shall notify the qualified taxpayer that claimed the credit of the amount recaptured, and the qualified taxpayer subject to recapture shall increase the qualified taxpayer's tax by the amount of any credit wrongfully claimed in the tax year the qualified taxpayer is notified of the recapture.

Section 1-20. Filing requirements. An owner of a qualified development that has received an allocation and each qualified taxpayer claiming any portion of the credit must file with their State tax returns a copy of the State credit eligibility statement issued by the Authority for that qualified development. A qualified taxpayer receiving an allocation of credit through a pass-through entity shall attach to its State tax return a copy of the Schedule K-1-P or other written statement from the pass-through entity stating the portion of the annual credit shown on the State credit eligibility statement that is allocated to that partner, member or shareholder for that taxable year. In addition, the owner of a qualified development or its designee shall file a copy of the allocation schedule certification prior to any tax return being filed claiming a State credit for such qualified development.

Section 1-25. Rules. The Illinois Housing Development Authority, the Department, and the Department of Insurance, in consultation with each other, shall adopt such rules as are necessary to carry out their respective responsibilities under this Act.

Section 1-30. Compliance monitoring. The Authority, in consultation with the Department, shall monitor and oversee compliance with the provisions of this Act and shall report specific occurrences of noncompliance to the Department and the Department of Insurance.

Section 1-35. Report to the General Assembly.

(a) The Illinois Housing Development Authority and the Chicago Department of Housing must, by December 31 of each allocation year, provide a written report to the General Assembly and must publish that report on their websites.

(b) The report shall:

(1) set forth the number of qualified developments that have been allocated tax credits under this Act during the allocation year and the total number of units supported by each qualified development;

(2) describe each qualified development that has been allocated tax credits under this Act including, without limitation, the geographic location of the qualified development, the household type and any specific demographic information available about residents intended to be served by the qualified development, the income levels intended to be served by the qualified development, and the rents or set-asides authorized for each qualified development;

(3) provide housing market and demographic information that demonstrates how the qualified developments supported by the tax credits are addressing the need for affordable housing within the communities they are intended to serve as well as information about any remaining disparities in the affordability of housing within those communities; and

(4) provide information on the percentage of qualified developments allocated credits that received incentive scoring points in the qualified allocation plan as a result of the general contractor, property manager, architect, or sponsor being certified under the Business Enterprise Program for Minorities, Females, and Persons with a Disability.

Section 1-40. Exempt from automatic sunset. The credit under this Act is exempt from the provisions of Section 250 of the Illinois Income Tax Act.

Article 90. Amendatory Provisions

Section 90-5. The Illinois Housing Development Act is amended by adding Section 13.1 as follows:

(20 ILCS 3805/13.1 new)

Sec. 13.1. Form for local agencies. The Authority shall develop a form and include it with the final financing agreement that summarizes the terms of the financing agreement, which should include the following: the length of the affordability period guaranteed under the financing agreement; a legal description; if then available, the address and property index numbers for all applicable property contemplated by the agreement; and any other information that may be relevant for a local county assessor's office and local county and municipal housing development authority to qualify or evidence eligibility for an applicable reduction in the assessed value of an affordable rental housing. This form may vary by county only if the Authority deems necessary. The nonprofit corporation, housing corporation, limited-profit entity, developer, or other entity receiving financing or other assistance under this Act shall file the form with the local county assessor's office and, where applicable, the local county and municipal housing authority for the county in which the property is located. No fees shall be levied against the nonprofit corporation, housing corporation, limited-profit entity, developer, or other entity for filing the form with the county assessor's office of local housing authority.

Section 90-10. The Illinois Income Tax Act is amended by adding Section 232 as follows:

(35 ILCS 5/232 new)

Sec. 232. Build Illinois Homes Tax Credit Act.

(a) For taxable years beginning on or after January 1, 2022, any eligible taxpayer with respect to a credit awarded in accordance with the Build Illinois Homes Tax Credit Act on or after January 1, 2021 that is named on the allocation schedule certification for a particular tax year is entitled to a credit against the taxes imposed by subsections (a) and (b) of Section 201 as provided in the Build Illinois Homes Tax Credit Act.

(b) The taxpayer shall attach a copy of the allocation schedule certification and the State credit eligibility certificate issued under the Build Illinois Homes Tax Credit Act to the tax return on which the credits are to be claimed.

(c) If, during any taxable year, a taxpayer is notified of a recapture of a credit previously claimed on a State income tax return in accordance with the Build Illinois Homes Tax Credit Act, the tax imposed under subsections (a) and (b) of Section 201 for that taxpayer for that taxable year shall be increased. The amount of the increase shall be determined by (i) recomputing the Build Illinois Homes Tax Credit that would have been allowed for the year in which the credit was originally allowed by eliminating the recaptured amount from such computation, and (ii) subtracting that recomputed credit from the amount of credit previously allowed. No Build Illinois Homes tax Credit shall be allowed with respect to any credit subject to a recapture notice for any taxable year ending after the issuance of a recapture notice.

(d) This Section is exempt from the provisions of Section 250.

Section 90-15. The Retailers' Occupation Tax Act is amended by changing Section 5m as follows:

(35 ILCS 120/5m new)

Sec. 5m. Building materials exemption; affordable housing.

(a) Beginning July 1, 2022, each retailer located within a disproportionately impacted area who makes a qualified sale of building materials to be incorporated into an 100% affordable housing project by rehabilitation or new construction, may deduct receipts from those sales when calculating the tax imposed by this Act. For purposes of this Section, "qualified sale" means a sale of building materials from a business located in a disproportionately impacted area that will be incorporated an 100% affordable housing project for which an Affordable Housing Building Materials Exemption Certificate has been issued to the purchaser by the Department. A construction contractor or other entity shall not make tax-free purchases unless it has an active exemption certificate issued by the Department at the time of the purchase.

(b) To document the exemption allowed under this Section, the retailer must obtain from the purchaser the certification required under subsection (c), which must contain the Affordable Housing Building Materials Exemption Certificate number issued to the purchaser by the Department. The Department shall make the exemption certificates available directly to each construction contractor or other entity. The request for an Affordable Housing Building Materials Exemption Certificate from the Department must include the following information:

(1) the name and address of the construction contractor or other entity;

(2) the name and location or address of the 100% affordable housing project;

(3) the estimated amount of the exemption for each construction contractor or other entity for which a request for exemption certificate is made, based on a stated estimated average tax rate and the percentage of the contract that consists of materials;

(4) the period of time over which supplies for the project are expected to be purchased;

(5) statement demonstrating the commitment to provide affordable units that will remain affordable 10 years after being put into service; this statement must provide evidence by a financing agreement with the State or unit of local government, certification from a local housing development authority, or other documentation as determined by the Department; and

(6) other reasonable information as the Department may require, including, but not limited to FEIN numbers, to determine if the contractor or other entity, or any partner, or a corporate officer, and in the case of a limited liability company, any manager or member, of the construction contractor or other entity, is or has been the owner, a partner, a corporate officer, and in the case of a limited liability company, a manager or member, of a person that is in default for moneys due to the Department under this Act or any other tax or fee Act administered by the Department.

The Department shall issue the Affordable Housing Building Materials Exemption Certificate within 5 business days after receipt of a request to the Department. This requirement does not apply in circumstances where the Department, for reasonable cause, is unable to issue the exemption certificate within 5 business days. The Department may refuse to issue an exemption certificate under this Section if the owner, any partner, any corporate officer, or, in the case of a limited liability company, any manager or member, of the construction contractor or other entity is or has been the owner, a partner, a corporate officer, or, in the case of a limited liability company, a manager or member, of a person that is in default for moneys due to the Department under this Act or any other tax or fee Act administered by the Department.

The Department, in its discretion, may require that requests for Affordable Housing Building Materials Exemption Certificates be submitted electronically. The Department may, in its discretion, issue exemption certificates electronically. The Affordable Housing Building Materials Exemption Certificate number shall be designed in such a way that the Department can identify, from the unique number on the exemption certificate issued to a given construction contractor or other entity, the project for which the exemption certificate is issued and the construction contractor or other entity to whom the exemption certificate is issued. The exemption certificate shall contain an expiration date, which shall be no more than 2 years after the date of issuance. The Department may adopt rules allowing a contractor or other entity to renew an exemption certificate. A contractor or other entity may request that the Department rescind an Affordable Housing Building Materials Exemption Certificate previously issued by the Department that has not yet expired.

If the Department determines that a construction contractor or other entity that was issued an Affordable Housing Building Materials Exemption Certificate made a tax-exempt purchase, as described in this Section, that was not eligible for exemption under this Section or allowed another person to make a tax-exempt purchase, as described in this Section, that was not eligible for exemption under this Section, then, in addition to any tax or other penalty imposed, the construction contractor or other entity is subject to a penalty equal to the tax that would have been paid by the retailer under this Act as well as any applicable local retailers' occupation tax on the purchase that was not eligible for the exemption. The Affordable Housing Building Materials Exemption Certificate shall contain language stating that if the construction contractor or other entity who is issued the exemption certificate makes a tax-exempt purchase, as described in this Section, that is not eligible for exemption under this Section or allows another person to make a tax-exempt purchase, as described in this Section, that is not eligible for exemption under this Section, then, in addition to any tax or other penalty imposed, the construction contractor or other entity is subject to a penalty equal to the tax that would have been paid by the retailer under this Act as well as any applicable local retailers' occupation tax on the purchase that is not eligible for the exemption.

(c) In addition, the retailer must obtain certification from the purchaser that contains:

(1) a statement that the building materials are being purchased for a 100% affordable housing project;

(2) the location or address of the real estate into which the building materials will be incorporated;

(3) a description of the building materials being purchased;

(4) the purchaser's Affordable Housing Building Materials Exemption Certificate number issued by the Department; and

(5) the purchaser's signature and date of purchase.

(d) The deduction allowed by this Section for the sale of building materials may be limited, to the extent authorized by ordinance adopted after the effective date of this amendatory Act of the 102nd General Assembly, by a municipality or county located in a disproportionately impacted area into which the building materials will be incorporated. The ordinance may neither require nor prohibit the purchase of building materials from any retailer or class of retailers in order to qualify for the exemption allowed under this Section. The provisions of this Section are exempt from Section 2-70.

(e) For the purposes of this Section, the following terms have the same meanings given to those terms in the Illinois Affordable Housing Act: "affordable housing"; "low-income household"; and "very low-income household".

In addition, the following terms have the following meanings:

"Disproportionately impacted area" means a census tract or comparable geographic area that meets at least one of the following criteria, as determined by the Department of Commerce and Economic Opportunity:

(1) the area has a poverty rate of at least 20% according to the latest federal decennial census; or

(2) 75% or more of the children in the area participate in the federal free lunch program according to reported statistics from the State Board of Education; or

(3) at least 20% of the households in the area receive assistance under the Supplemental Nutrition Assistance Program; or

(4) the area has an average unemployment rate, as determined by the Department of Employment Security, that is more than 120% of the national unemployment average, as determined by the United States Department of Labor, for a period of at least 2 consecutive calendar years preceding the date of the application.

"One hundred percent affordable housing project" means a residential housing project that, after rehabilitation or new construction will lead to 100% of the units being utilized as affordable housing units. These units must remain affordable housing for 10 years commencing from the time a unit is put into operation.

Section 90-20. The Property Tax Code is amended by adding Section 15-178 as follows:

(35 ILCS 200/15-178 new)

Sec. 15-178. Reduction in assessed value for affordable rental housing construction or rehabilitation.

(a) The General Assembly finds that there is a shortage of high quality affordable rental homes for low-income and very-low-income households throughout Illinois; that owners and developers of rental housing face significant challenges building newly constructed apartments or undertaking rehabilitation of existing properties that results in rents that are affordable for low-income and very-low-income households; and that it will help Cook County and other parts of Illinois address the extreme shortage of affordable rental housing by developing a Statewide policy to determine the assessed value for newly constructed and rehabilitated affordable rental housing that both encourages investment and incentivizes property owners to keep rents affordable.

(b) Each chief county assessment officer shall implement special assessment programs to reduce the assessed value of all eligible newly-constructed residential real property or qualifying rehabilitation to all eligible existing residential real property in accordance with subsection (c) for 10 taxable years after the newly constructed residential real property or improvements to existing residential real property are put in service. Any county with less than 3,000,000 inhabitants may decide not to implement one or both of the special assessment programs defined in in subparagraph (1) of subsection (c) of this Section and subparagraph (2) of subsection (c) of this Section upon passage of an ordinance by a majority vote of the county board. Subsequent to a vote to opt-out of this special assessment program, any county with less than 3,000,000 inhabitants may decide to implement one or both of the special assessment programs defined in in subparagraph (1) of subsection (c) of this Section and subparagraph (2) of subsection (c) of this Section upon passage of an ordinance by a majority vote of the county board. Property is eligible for the special assessment program if and only if all of the following factors have been met:

(1) at the conclusion of the new construction or qualifying rehabilitation, the property consists of a newly-constructed multifamily building containing 7 or more rental dwelling units or an existing multifamily building that has undergone qualifying rehabilitation resulting in 7 or more rental dwelling units; and

(2) the property meets the application requirements defined in subsection (f).

(c) For those counties that are required to implement the special assessment program and do not opt-out of such special assessment program, the chief county assessment officer for that county shall require that residential real property is eligible for the special assessment program if and only if one of the additional factors have been met:

(1) except as defined in subparagraphs (E), (F), and (G) of paragraph (5) of subsection (f) of this Section, prior to the newly-constructed residential real property or improvements to existing residential real property being put in service, the owner of the residential real property commits that, for a period of 10 years, at least 15% of the multifamily building's units will have rents as defined in this Section that are at or below maximum rents and are occupied by households with household incomes at or below maximum income limits; or

(2) except as defined in subparagraphs (E), (F), and (G) of paragraph (5) of subsection (f) of this Section, prior to the newly constructed residential real property located in a low affordability community being put in service, the owner of the residential real property commits that, for a period of 30 years after the newly constructed residential real property or improvements to existing residential real property are put in service, at least 20% of the multifamily building's units will have rents as defined in this Section that are at or below maximum rents and are occupied by households with household incomes at or below maximum income limits.

If a reduction in assessed value is granted under one special assessment program provided for in this Section, then that same residential real property is not eligible for an additional special assessment program under this Section at the same time.

(d) The amount of the reduction in assessed value for residential real property meeting the conditions set forth in subparagraph (1) of subsection (c) shall be calculated as follows:

(1) if the owner of the residential real property commits for a period of at least 10 years that at least 15% but fewer than 35% of the multifamily building's units have rents at or below maximum rents and are occupied by households with household incomes at or below maximum income limits, the assessed value of the property used to calculate the tax bill shall be reduced by an amount equal to 25% of the assessed value of the property as determined by the assessor for the property in the current taxable year for the newly-constructed residential real property or based on the improvements to an existing residential real property; and

(2) if the owner of the residential real property commits for a period of at least 10 years that at least 35% of the multifamily building's units have rents at or below maximum rents and are occupied by households with household incomes at or below maximum income limits, the assessed value of the property used to calculate the tax bill shall be reduced by an amount equal to 35% of the assessed value of the property as determined by the assessor for the property in the current assessment year for the newly constructed residential real property or based on the improvements to an existing residential real property.

(e) The amount of the reduction for residential real property meeting the conditions set forth in subparagraph (2) of subsection (c) shall be calculated as follows:

(1) for the first, second, and third taxable year after the residential real property or improvements are placed in service, the residential real property is entitled to a reduction in its assessed value in an amount equal to the difference between the assessed value in the year for which the incentive is sought and the assessed value for the residential real property in the base year;

(2) for the fourth, fifth, and sixth taxable year after the residential real property or improvements are placed in service, the property is entitled to a reduction in its assessed value in an amount equal to 80% of the difference between the assessed value in the year for which the incentive is sought and the assessed value for the residential real property in the base year;

(3) for the seventh, eighth, and ninth taxable year after the property or improvements are placed in service, the residential real property is entitled to a reduction in its assessed value in an amount equal to 60% of the difference between the assessed value in the year for which the incentive is sought and the assessed value for the residential real property in the base year;

(4) for the tenth, eleventh, and twelfth taxable year after the residential real property or improvements are placed in service, the residential real property is entitled to a reduction in its assessed value in an amount equal to 40% of the difference between the assessed value in the year for which the incentive is sought and the assessed value for the residential real property in the base year; and

(5) for the thirteenth through the thirtieth taxable year after the residential real property or improvements are placed in service, the residential real property is entitled to a reduction in its assessed value in an amount equal to 20% of the difference between the assessed value in the year for which the incentive is sought and the assessed value for the residential real property in the base year.

(f) Application requirements.

(1) In order to receive the reduced valuation under this Section, the owner must submit an application containing the following information to the chief county assessment officer for review in the form and by the date required by the chief county assessment officer:

(A) the owner's name;

(B) the postal address and permanent index number or numbers of the parcel or parcels for which the owner is applying to receive reduced valuation under this Section;

(C) a deed or other instrument conveying the parcel or parcels to the current owner;

(D) written evidence that the new construction or qualifying rehabilitation has been completed with respect to the residential real property, including, but not limited to, copies of building permits, a notarized contractor's sworn affidavit, and photographs of the interior and exterior of the building after new construction or rehabilitation is completed;

(E) written evidence that the residential real property meets local building codes, or if there are no local building codes, Housing Quality Standards, as determined by the United States Department of Housing and Urban Development;

(F) a list identifying the affordable units in residential real property and a written statement that the affordable units are comparable to the market rate units in terms of unit type, number of bedrooms per unit, quality of exterior appearance, energy efficiency, and overall quality of construction;

(G) a written schedule certifying the rents in each affordable unit and a written statement that these rents do not exceed the maximum rents allowable for the area in which the residential real property is located;

(H) documentation from the administering agency verifying the owner's participation in a qualifying income-based rental subsidy program as defined in subsection (e) of this Section if units receiving rental subsidies are to be counted among the affordable units in order to meet the thresholds defined in this Section;

(I) a written statement identifying the household income for every household occupying an affordable unit and certifying that the household income does not exceed the maximum income limits allowable for the area in which the residential real property is located;

(J) a written statement that the owner has verified and retained documentation of household income for every household occupying an affordable unit; and

(K) any additional information consistent with this Section as reasonably required by the chief county assessment officer, including, but not limited to, any information necessary to ensure compliance with applicable local ordinances and to ensure the owner is complying with the provisions of subparagraph (F) of paragraph (4) of subsection (d) of this Section.

(2) The application requirements contained in paragraph (1) of subsection (f) are continuing requirements for the duration of the reduction in assessed value received and may be annually or periodically verified by the chief county assessment officer for the county whereby the benefit is being issued.

(3) In lieu of submitting an application containing the information prescribed in paragraph (1) of subsection (f), the chief county assessment officer may allow for submission of a substantially similar certification granted by the Illinois Housing Development Authority or a comparable local authority provided that the chief county assessment officer independently verifies the veracity of the certification with the Illinois Housing Development Authority or comparable local authority.

(4) The chief county assessment officer shall notify the owner as to whether or not the property meets the requirements of this Section. If the property does not meet the requirements of this Section, the chief county assessment officer shall provide written notice of any deficiencies to the owner, who shall then have 30 days from the date of notification to provide supplemental information showing compliance with this Section. The chief county assessment officer shall, in its discretion, grant additional time to cure any deficiency. If the owner does not exercise this right to cure the deficiency, or if the information submitted, in the sole judgment of the chief county assessment officer, is insufficient to meet the requirements of this Section, the chief county assessment officer shall provide a written explanation of the reasons for denial.

(5) The chief county assessment officer may charge a reasonable application fee to offset the administrative expenses associated with the program.

(6) The reduced valuation conferred by this Section is limited as follows:

(A) The owner is eligible to apply for the reduced valuation conferred by this Section beginning in the first assessment year after the effective date of this amendatory Act of the 102nd General Assembly through December 31, 2031. If approved, the reduction will be effective for the current assessment year, which will be reflected in the tax bill issued in the following calendar year. Owners that are approved for the reduced valuation under this Section before December 31, 2031 shall, at minimum, be eligible for annual renewal of the reduced valuation during an initial 10-year period if annual certification requirements are met for each of the 10 years, as described in subparagraph (B) of paragraph (4) of subsection (d) of this Section until December 31, 2041.

(B) Property receiving a reduction outlined in paragraph (1) of subsection (c) of this Section shall continue to be eligible for an initial period of up to 10 years if annual certification requirements are met for each of the 10 years, but shall be extended for up to 2 additional 10-year periods with annual renewals if the owner continues to meet the requirements of this Section, including annual certifications, and excluding the requirements regarding new construction or qualifying rehabilitation defined in subparagraph (D) of paragraph (1) of this subsection.

(C) The annual certification materials in the year prior to final year of eligibility for the reduction in assessed value must include a dated copy of the written notice provided to tenants informing them of the date of the termination if the owner is not seeking a renewal.

(D) If the property is sold or transferred, the purchaser or transferee must comply with all requirements of this Section, excluding the requirements regarding new construction or qualifying rehabilitation defined in subparagraph (D) of paragraph (1) of this subsection, in order to continue receiving the reduction in assessed value. Purchasers and transferees who comply with all requirements of this Section excluding the requirements regarding new construction or qualifying rehabilitation defined in subparagraph (D) of paragraph (1) of this subsection are eligible to apply for renewal on the schedule set by the initial application.

(E) The owner may apply for the reduced valuation if the residential real property meets all requirements of this Section and the newly-constructed residential real property or improvements to existing residential real property were put in service on or after January 1, 2015. However, the initial 10-year eligibility period shall be reduced by the number of years between the placed in service date and the date the owner first receives this reduced valuation.

(F) The owner may apply for the reduced valuation within 2 years after the newly-constructed residential real property or improvements to existing residential real property are put in service. However, the initial 10 year eligibility period shall be reduced for the number of years between the placed in service date and the date the owner first receives this reduced valuation.

(G) Owners of a multifamily building receiving a reduced valuation through the Cook County Class 9 program during the year in which this amendatory Act of the 102nd General Assembly takes effect shall be deemed automatically eligible for the reduced valuation defined in this Section in terms of meeting the criteria for new construction or substantial rehabilitation for a specific multifamily building regardless of when the newly-constructed residential real property or improvements to existing residential real property were put in service. If a Cook County Class 9 owner had Class 9 status revoked on or after January 1, 2017 but can provide documents sufficient to prove that the revocation was in error or any deficiencies leading to the revocation have been cured, the chief county assessment officer may deem the owner to be eligible. However, owners may not receive both the reduced valuation under this Section and the reduced valuation under the Cook County Class 9 program in any single assessment year. In addition, the number of years during which an owner has participated in the Class 9 program shall count against the 3 10-year periods of eligibility for the reduced valuation as defined in subparagraph (1) of subsection (c) of this Section.

(H) At the completion of the assessment reduction period described in this Section, the entire parcel will be assessed as otherwise provided by law.

(e) For the purposes of this Section,

"Affordable units" means units that have rents that do not exceed the maximum rents as defined in this Section.

"Household income" includes the annual income for all the people who occupy a housing unit that is anticipated to be received from a source outside of the family during the 12-month period following admission or the annual recertification, including related family members and all the unrelated people who share the housing unit. Household income includes the sum total of the following income sources: wages, salaries and tips before any payroll deductions; net business income; interest and dividends; payments in lieu of earnings, such as unemployment and disability compensation, worker's compensation and severance pay; Social Security income, including lump sum payments; payments from insurance policies, annuities, pensions, disability benefits and other types of periodic payments, alimony, child support, and other regular monetary contributions; and public assistance, except for assistance from the Supplemental Nutrition Assistance Program (SNAP). "Household income" does not include: earnings of children under age 18; temporary income such as cash gifts; reimbursement for medical expenses; lump sums from inheritance, insurance payments, settlements for personal or property losses; student financial assistance paid directly to the student or to an educational institution; foster child care payments; receipts from government-funded training programs; assistance from the Supplemental Nutrition Assistance Program (SNAP).

"Low affordability community" means (1) a municipality or jurisdiction in which 40% or less of its total year-round housing units are affordable, as determined by the Illinois Housing Development Authority during the exemption determination process under the Affordable Housing Planning and Appeal Act; or (2) a jurisdiction located in a municipality with 1,000,000 or more inhabitants that has been designated as a low affordability community by passage of a local ordinance by that municipality, specifying the census tract or property by permanent index number or numbers.

"Maximum income limits" means the maximum regular income limits for 60% of area median income for the geographic area in which the multifamily building is located for multifamily programs as determined by the United States Department of Housing and Urban Development and published annually by the Illinois Housing Development Authority.

"Maximum rent" means the maximum regular rent for 60% of the area median income for the geographic area in which the multifamily building is located for multifamily programs as determined by the United States Department of Housing and Urban Development and published annually by the Illinois Housing Development Authority. To be eligible for the reduced valuation defined in this Section, maximum rents are to be consistent with the Illinois Housing Development Authority's rules; or if the owner is leasing an affordable unit to a household with an income at or below the maximum income limit who is participating in qualifying income-based rental subsidy program, "maximum rent" means the maximum rents allowable under the guidelines of the qualifying income-based rental subsidy program.

"Qualifying income-based rental subsidy program" means a Housing Choice Voucher issued by a housing authority under Section 8 of the United States Housing Act of 1937, a tenant voucher converted to a project-based voucher by a housing authority or any other program administered or funded by a housing authority, the Illinois Housing Development Authority, another State agency, a federal agency, or a unit of local government where participation is limited to households with incomes at or below the maximum income limits as defined in this Section and the tenants' portion of the rent payment is based on a percentage of their income or a flat amount that does not exceed the maximum rent as defined in this Section.

"Qualifying rehabilitation" means, at a minimum, compliance with local building codes and the replacement or renovation of at least 2 primary building systems to be approved for the reduced valuation under paragraph (1) of subsection (c) of this Section and at least 5 primary building systems to be approved for the reduced valuation under paragraph (2) of subsection (c) of this Section. Although the cost of each primary building system may vary, to be approved for the reduced valuation under paragraph (1) of subsection (c) of this Section, the combined expenditure for making the building compliant with local codes and replacing primary building systems must be at least $8 per square foot for work completed between January 1 of the year in which this amendatory Act of the 102nd General Assembly takes effect and December 31 of the year in which this amendatory Act of the 102nd General Assembly takes effect and, in subsequent years, $8 adjusted by the Consumer Price Index for All Urban Consumers, as published annually by the U.S. Department of Labor. To be approved for the reduced valuation under paragraph (2) of subsection (c) of this Section, the combined expenditure for making the building compliant with local codes and replacing primary building systems must be at least $60 per square foot for work completed between January 1 of the year that this amendatory Act of the 102nd General Assembly becomes effective and December 31 of the year that this amendatory Act of the 102nd General Assembly becomes effective and, in subsequent years, $60 adjusted by the Consumer Price Index for All Urban Consumers, as published annually by the U.S. Department of Labor. "Primary building systems", together with their related rehabilitations, specifically approved for this program are:

(1) Electrical. All electrical work must comply with applicable codes; it may consist of a combination of any of the following alternatives:

(A) installing individual equipment and appliance branch circuits as required by code (the minimum being a kitchen appliance branch circuit);

(B) installing a new emergency service, including emergency lighting with all associated conduits and wiring;

(C) rewiring all existing feeder conduits ("home runs") from the main switchgear to apartment area distribution panels;

(D) installing new in-wall conduits for receptacles, switches, appliances, equipment, and fixtures;

(E) replacing power wiring for receptacles, switches, appliances, equipment, and fixtures;

(F) installing new light fixtures throughout the building including closets and central areas;

(G) replacing, adding, or doing work as necessary to bring all receptacles, switches, and other electrical devices into code compliance;

(H) installing a new main service, including conduit, cables into the building, and main disconnect switch; and

(I) installing new distribution panels, including all panel wiring, terminals, circuit breakers, and all other panel devices.

(2) Heating. All heating work must comply with applicable codes; it may consist of a combination of any of the following alternatives:

(A) installing a new system to replace one of the following heat distribution systems:

(i) piping and heat radiating units, including new main line venting and radiator venting; or

(ii) duct work, diffusers, and cold air returns; or

(iii) any other type of existing heat distribution and radiation/diffusion components; or

(B) installing a new system to replace one of the following heat generating units:

(i) hot water/steam boiler;

(ii) gas furnace; or

(iii) any other type of existing heat generating unit.

(3) Plumbing. All plumbing work must comply with applicable codes. Replace all or a part of the in-wall supply and waste plumbing; however, main supply risers, waste stacks and vents, and code-conforming waste lines need not be replaced.

(4) Roofing. All roofing work must comply with applicable codes; it may consist of either of the following alternatives, separately or in combination:

(A) replacing all rotted roof decks and insulation; or

(B) replacing or repairing leaking roof membranes (10% is the suggested minimum replacement of membrane); restoration of the entire roof is an acceptable substitute for membrane replacement.

(5) Exterior doors and windows. Replace the exterior doors and windows. Renovation of ornate entry doors is an acceptable substitute for replacement.

(6) Floors, walls, and ceilings. Finishes must be replaced or covered over with new material. Acceptable replacement or covering materials are as follows:

(A) floors must have new carpeting, vinyl tile, ceramic, refurbished wood finish, or a similar substitute;

(B) walls must have new drywall, including joint taping and painting; or

(C) new ceilings must be either drywall, suspended type, or a similar

(7) Exterior walls.

(A) replace loose or crumbling mortar and masonry with new material;

(B) replace or paint wall siding and trim as needed;

(C) bring porches and balconies to a sound condition; or

(D) any combination of (A), (B), and (C).

(8) Elevators. Where applicable, at least 4 of the following 7 alternatives must be accomplished:

(A) replace or rebuild the machine room controls and refurbish the elevator machine (or equivalent mechanisms in the case of hydraulic elevators);

(B) replace hoistway electro-mechanical items including: ropes, switches, limits, buffers, levelers, and deflector sheaves (or equivalent mechanisms in the case of hydraulic elevators);

(C) replace hoistway wiring;

(D) replace door operators and linkage;

(E) replace door panels at each opening;

(F) replace hall stations, car stations, and signal fixtures; or

(G) rebuild the car shell and refinish the interior.

(9) Health and safety.

(A) install or replace fire suppression systems;

(B) install or replace security systems; or

(C) environmental remediation of lead-based paint, asbestos, leaking underground storage tanks, or radon.

(10) Energy conservation improvements undertaken to limit the amount of solar energy absorbed by a building's roof or to reduce energy use for the property, including, but not limited to, any of the following activities:

(A) installing or replacing reflective roof coatings (flat roofs);

(B) installing or replacing R-49 roof insulation;

(C) installing or replacing R-19 perimeter wall insulation;

(D) installing or replacing insulated entry doors;

(E) installing or replacing Low E, insulated windows;

(F) installing or replacing WaterSense labeled plumbing fixtures;

(G) installing or replacing 90% or better sealed combustion heating systems;

(H) installing Energy Star hot water heaters;

(I) installing or replacing mechanical ventilation to exterior for kitchens and baths;

(J) installing or replacing Energy Star appliances;

(K) installing or replacing Energy Star certified lighting in common areas; or

(L) installing or replacing grading and landscaping to promote on-site water retention if the retained water is used to replace water that is provided from a municipal source.

(11) Accessibility improvements. All accessibility improvements must comply with applicable codes. An owner may make accessibility improvements to residential real property to increase access for people with disabilities. As used in this paragraph (11), "disability" has the meaning given to that term in the Illinois Human Rights Act. As used in this paragraph (11), "accessibility improvements" means a home modification listed under the Home Services Program administered by the Department of Human Services (Part 686 of Title 89 of the Illinois Administrative Code) including, but not limited to: installation of ramps, grab bars, or wheelchair lifts; widening doorways or hallways; re-configuring rooms and closets; and any other changes to enhance the independence of people with disabilities.

(12) Any applicant who has purchased the property in an arm's length transaction not more than 90 days before applying for this reduced valuation may use the cost of rehabilitation or repairs required by documented code violations, up to a maximum of $2 per square foot, to meet the qualifying rehabilitation requirements.

Section 90-25. The Illinois Insurance Code is amended by changing Sections 409 and 444 as follows:

(215 ILCS 5/409) (from Ch. 73, par. 1021)

Sec. 409. Annual privilege tax payable by companies.

(1) As of January 1, 1999 for all health maintenance organization premiums written; as of July 1, 1998 for all premiums written as accident and health business, voluntary health service plan business, dental service plan business, or limited health service organization business; and as of January 1, 1998 for all other types of insurance premiums written, every company doing any form of insurance business in this State, including, but not limited to, every risk retention group, and excluding all fraternal benefit societies, all farm mutual companies, all religious charitable risk pooling trusts, and excluding all statutory residual market and special purpose entities in which companies are statutorily required to participate, whether incorporated or otherwise, shall pay, for the privilege of doing business in this State, to the Director for the State treasury a State tax equal to 0.5% of the net taxable premium written, together with any amounts due under Section 444 of this Code, except that the tax to be paid on any premium derived from any accident and health insurance or on any insurance business written by any company operating as a health maintenance organization, voluntary health service plan, dental service plan, or limited health service organization shall be equal to 0.4% of such net taxable premium written, together with any amounts due under Section 444. Upon the failure of any company to pay any such tax due, the Director may, by order, revoke or suspend the company's certificate of authority after giving 20 days written notice to the company, or commence proceedings for the suspension of business in this State under the procedures set forth by Section 401.1 of this Code. The gross taxable premium written shall be the gross amount of premiums received on direct business during the calendar year on contracts covering risks in this State, except premiums on annuities, premiums on which State premium taxes are prohibited by federal law, premiums paid by the State for health care coverage for Medicaid eligible insureds as described in Section 5-2 of the Illinois Public Aid Code, premiums paid for health care services included as an element of tuition charges at any university or college owned and operated by the State of Illinois, premiums on group insurance contracts under the State Employees Group Insurance Act of 1971, and except premiums for deferred compensation plans for employees of the State, units of local government, or school districts. The net taxable premium shall be the gross taxable premium written reduced only by the following:

(a) the amount of premiums returned thereon which shall be limited to premiums returned during the same preceding calendar year and shall not include the return of cash surrender values or death benefits on life policies including annuities;

(b) dividends on such direct business that have been paid in cash, applied in reduction of premiums or left to accumulate to the credit of policyholders or annuitants. In the case of life insurance, no deduction shall be made for the payment of deferred dividends paid in cash to policyholders on maturing policies; dividends left to accumulate to the credit of policyholders or annuitants shall be included as gross taxable premium written when such dividend accumulations are applied to purchase paid-up insurance or to shorten the endowment or premium paying period.

(2) The annual privilege tax payment due from a company under subsection (4) of this Section may be reduced by: (a) the excess amount, if any, by which the aggregate income taxes paid by the company, on a cash basis, for the preceding calendar year under Sections 601 and 803 of the Illinois Income Tax Act exceed 1.5% of the company's net taxable premium written for that prior calendar year, as determined under subsection (1) of this Section; and (b) the amount of any fire department taxes paid by the company during the preceding calendar year under Section 11-10-1 of the Illinois Municipal Code. Any deductible amount or offset allowed under items (a) and (b) of this subsection for any calendar year will not be allowed as a deduction or offset against the company's privilege tax liability for any other taxing period or calendar year.

(3) If a company survives or was formed by a merger, consolidation, reorganization, or reincorporation, the premiums received and amounts returned or paid by all companies party to the merger, consolidation, reorganization, or reincorporation shall, for purposes of determining the amount of the tax imposed by this Section, be regarded as received, returned, or paid by the surviving or new company.

(4)(a) All companies subject to the provisions of this Section shall make an annual return for the preceding calendar year on or before March 15 setting forth such information on such forms as the Director may reasonably require. Payments of quarterly installments of the taxpayer's total estimated tax for the current calendar year shall be due on or before April 15, June 15, September 15, and December 15 of such year, except that all companies transacting insurance in this State whose annual tax for the immediately preceding calendar year was less than $5,000 shall make only an annual return. Failure of a company to make the annual payment, or to make the quarterly payments, if required, of at least 25% of either (i) the total tax paid during the previous calendar year or (ii) 80% of the actual tax for the current calendar year shall subject it to the penalty provisions set forth in Section 412 of this Code.

(b) Notwithstanding the foregoing provisions, no annual return shall be required or made on March 15, 1998, under this subsection. For the calendar year 1998:

(i) each health maintenance organization shall have no estimated tax installments;

(ii) all companies subject to the tax as of July 1, 1998 as set forth in subsection (1) shall have estimated tax installments due on September 15 and December 15 of 1998 which installments shall each amount to no less than one-half of 80% of the actual tax on its net taxable premium written during the period July 1, 1998, through December 31, 1998; and

(iii) all other companies shall have estimated tax installments due on June 15, September 15, and December 15 of 1998 which installments shall each amount to no less than one-third of 80% of the actual tax on its net taxable premium written during the calendar year 1998.

In the year 1999 and thereafter all companies shall make annual and quarterly installments of their estimated tax as provided by paragraph (a) of this subsection.

(5) In addition to the authority specifically granted under Article XXV of this Code, the Director shall have such authority to adopt rules and establish forms as may be reasonably necessary for purposes of determining the allocation of Illinois corporate income taxes paid under subsections (a) through (d) of Section 201 of the Illinois Income Tax Act amongst members of a business group that files an Illinois corporate income tax return on a unitary basis, for purposes of regulating the amendment of tax returns, for purposes of defining terms, and for purposes of enforcing the provisions of Article XXV of this Code. The Director shall also have authority to defer, waive, or abate the tax imposed by this Section if in his opinion the company's solvency and ability to meet its insured obligations would be immediately threatened by payment of the tax due.

(6) This Section is subject to the provisions of Section 10 of the New Markets Development Program Act.

(7) This Section is subject to the provisions of the Build Illinois Homes Tax Credit Act. For taxable years beginning on or after January 1, 2022, qualified taxpayers are entitled to claim credits awarded in accordance with the Build Illinois Homes Tax Credit on or after January 1, 2021 against the taxes imposed by this Section as provided in the Build Illinois Homes Tax Credit Act. Companies claiming a credit under the Build Illinois Homes Tax Credit Act are not required to pay any additional tax as a result of claiming the credit. The credit may fully offset any amounts imposed under this Section.

(Source: P.A. 97-813, eff. 7-13-12; 98-1169, eff. 1-9-15.)

(215 ILCS 5/444) (from Ch. 73, par. 1056)

Sec. 444. Retaliation.

(1) Whenever the existing or future laws of any other state or country shall require of companies incorporated or organized under the laws of this State as a condition precedent to their doing business in such other state or country, compliance with laws, rules, regulations, and prohibitions more onerous or burdensome than the rules and regulations imposed by this State on foreign or alien companies, or shall require any deposit of securities or other obligations in such state or country, for the protection of policyholders or otherwise or require of such companies or agents thereof or brokers the payment of penalties, fees, charges, or taxes greater than the penalties, fees, charges, or taxes required in the aggregate for like purposes by this Code or any other law of this State, of foreign or alien companies, agents thereof or brokers, then such laws, rules, regulations, and prohibitions of said other state or country shall apply to companies incorporated or organized under the laws of such state or country doing business in this State, and all such companies, agents thereof, or brokers doing business in this State, shall be required to make deposits, pay penalties, fees, charges, and taxes, in amounts equal to those required in the aggregate for like purposes of Illinois companies doing business in such state or country, agents thereof or brokers. Whenever any other state or country shall refuse to permit any insurance company incorporated or organized under the laws of this State to transact business according to its usual plan in such other state or country, the director may, if satisfied that such company of this State is solvent, properly managed, and can operate legally under the laws of such other state or country, forthwith suspend or cancel the license of every insurance company doing business in this State which is incorporated or organized under the laws of such other state or country to the extent that it insures in this State against any of the risks or hazards which are sought to be insured against by the company of this State in such other state or country.

(2) The provisions of this Section shall not apply to residual market or special purpose assessments or guaranty fund or guaranty association assessments, both under the laws of this State and under the laws of any other state or country, and any tax offset or credit for any such assessment shall, for purposes of this Section, be treated as a tax paid both under the laws of this State and under the laws of any other state or country.

(3) The terms "penalties", "fees", "charges", and "taxes" in subsection (1) of this Section shall include: the penalties, fees, charges, and taxes collected on a cash basis under State law and referenced within Article XXV exclusive of any items referenced by subsection (2) of this Section, but including any tax offset allowed under Section 531.13 of this Code; the aggregate Illinois corporate income taxes paid under Sections 601 and 803 of the Illinois Income Tax Act during the calendar year for which the retaliatory tax calculation is being made, less the recapture of any Illinois corporate income tax cash refunds to the extent that the amount of tax refunded was reported as part of the Illinois basis in the calculation of the retaliatory tax for a prior tax year, provided that such recaptured refund shall not exceed the amount necessary for equivalence of the Illinois basis with the state of incorporation basis in such tax year, and after any tax offset allowed under Section 531.13 of this Code; income or personal property taxes imposed by other states or countries; penalties, fees, charges, and taxes of other states or countries imposed for purposes like those of the penalties, fees, charges, and taxes specified in Article XXV of this Code exclusive of any item referenced in subsection (2) of this Section; and any penalties, fees, charges, and taxes required as a franchise, privilege, or licensing tax for conducting the business of insurance whether calculated as a percentage of income, gross receipts, premium, or otherwise.

(4) Nothing contained in this Section or Section 409 or Section 444.1 is intended to authorize or expand any power of local governmental units or municipalities to impose taxes, fees, or charges.

(5) This Section is subject to the provisions of Section 10 of the New Markets Development Program Act.

(6) This Section is subject to the provisions of the Build Illinois Homes Tax Credit Act. For taxable years beginning on or after January 1, 2022, qualified taxpayers are entitled to claim credits awarded in accordance with the Build Illinois Homes Tax Credit on or after January 1, 2021 against the taxes imposed by this Section as provided in the Build Illinois Homes Tax Credit Act. Companies claiming a credit under the Build Illinois Homes Tax Credit Act are not required to pay any additional tax as a result of claiming the credit. The credit may fully offset any amounts imposed under this Section.

(Source: P.A. 98-1169, eff. 1-9-15.)

Section 90-30. The Affordable Housing Planning and Appeal Act is amended by changing Sections 15, 25, and 50 and by adding Section 70 as follows:

(310 ILCS 67/15)

Sec. 15. Definitions. As used in this Act:

"Affordable housing" means housing that has a value or cost or rental amount that is within the means of a household that may occupy moderate-income or low-income housing. In the case of owner-occupied dwelling units, housing that is affordable means housing in which mortgage, amortization, taxes, insurance, and condominium or association fees, if any, constitute no more than 30% of the gross annual household income for a household of the size that may occupy the unit. In the case of dwelling units for rent, housing that is affordable means housing for which the rent, any required parking, maintenance, landlord-imposed fees, and utilities constitute no more than 30% of the gross annual household income for a household of the size that may occupy the unit.

"Affordable housing developer" means a nonprofit entity, limited equity cooperative or public agency, or private individual, firm, corporation, or other entity seeking to build an affordable housing development.

"Affordable housing development" means (i) any housing that is subsidized by the federal or State government or (ii) any housing in which at least 20% of the dwelling units are subject to covenants or restrictions that require that the dwelling units be sold or rented at prices that preserve them as affordable housing for a period of at least 15 years, in the case of owner-occupied housing, and at least 30 years, in the case of rental housing.

"Approving authority" means the governing body of the county or municipality.

"Area median household income" means the median household income adjusted for family size for applicable income limit areas as determined annually by the federal Department of Housing and Urban Development under Section 8 of the United States Housing Act of 1937.

"Community land trust" means a private, not-for-profit corporation organized exclusively for charitable, cultural, and other purposes and created to acquire and own land for the benefit of the local government, including the creation and preservation of affordable housing.

"Development" means any building, construction, renovation, or excavation or any material change in any structure or land, or change in the use of such structure or land, that results in a net increase in the number of dwelling units in a structure or on a parcel of land by more than one dwelling unit.

"Exempt local government" means any local government in which at least 10% of its total year-round housing units are affordable, as determined by the Illinois Housing Development Authority pursuant to Section 20 of this Act; or any municipality under 1,000 population.

"Household" means the person or persons occupying a dwelling unit.

"Housing trust fund" means a separate fund, either within a local government or between local governments pursuant to intergovernmental agreement, established solely for the purposes authorized in subsection (d) of Section 25, including, without limitation, the holding and disbursing of financial resources to address the affordable housing needs of individuals or households that may occupy low-income or moderate-income housing.

"Local government" means a county or municipality.

"Low-income housing" means housing that is affordable, according to the federal Department of Housing and Urban Development, for either home ownership or rental, and that is occupied, reserved, or marketed for occupancy by households with a gross household income that does not exceed 50% of the area median household income.

"Moderate-income housing" means housing that is affordable, according to the federal Department of Housing and Urban Development, for either home ownership or rental, and that is occupied, reserved, or marketed for occupancy by households with a gross household income that is greater than 50% but does not exceed 80% of the area median household income.

"Non-appealable local government requirements" means all essential requirements that protect the public health and safety, including any local building, electrical, fire, or plumbing code requirements or those requirements that are critical to the protection or preservation of the environment.

(Source: P.A. 98-287, eff. 8-9-13.)

(310 ILCS 67/25)

Sec. 25. Affordable housing plan.

(a) Prior to April 1, 2005, all non-exempt local governments must approve an affordable housing plan. Any local government that is determined by the Illinois Housing Development Authority under Section 20 to be non-exempt for the first time based on the recalculation of U.S. Census Bureau data after 2010 shall have 18 months from the date of notification of its non-exempt status to approve an affordable housing plan under this Act. On and after the effective date of this amendatory Act of the 102nd General Assembly, an affordable housing plan, or any revision thereof, shall not be adopted by a non-exempt local government until notice and opportunity for public hearing have first been afforded.

(b) For the purposes of this Act, the affordable housing plan shall consist of at least the following:

(i) a statement of the total number of affordable housing units that are necessary to exempt the local government from the operation of this Act as defined in Section 15 and Section 20;

(ii) an identification of lands within the jurisdiction that are most appropriate for the construction of affordable housing and of existing structures most appropriate for conversion to, or rehabilitation for, affordable housing, including a consideration of lands and structures of developers who have expressed a commitment to provide affordable housing and lands and structures that are publicly or semi-publicly owned;

(iii) incentives that local governments may provide for the purpose of attracting affordable housing to their jurisdiction; and

(iv) a goal of a minimum of 15% of all new development or redevelopment within the local government that would be defined as affordable housing in this Act; or a minimum of a 3 percentage point increase in the overall percentage of affordable housing within its jurisdiction, as described in subsection (b) of Section 20 of this Act; or a minimum of a total of 10% affordable housing within its jurisdiction as described in subsection (b) of Section 20 of this Act. These goals may be met, in whole or in part, through the creation of affordable housing units under intergovernmental agreements as described in subsection (e) of this Section.

(c) Within 60 days after the adoption of an affordable housing plan or revisions to its affordable housing plan, the local government must submit a copy of that plan to the Illinois Housing Development Authority.

(d) In order to promote the goals of this Act and to maximize the creation, establishment, or preservation of affordable housing throughout the State of Illinois, a local government, whether exempt or non-exempt under this Act, may adopt the following measures to address the need for affordable housing:

(1) Local governments may individually or jointly create or participate in a housing trust fund or otherwise provide funding or support for the purpose of supporting affordable housing, including, without limitation, to support the following affordable housing activities:

(A) Housing production, including, without limitation, new construction, rehabilitation, and adaptive re-use.

(B) Acquisition, including, without limitation, land, single-family homes, multi-unit buildings, and other existing structures that may be used in whole or in part for residential use.

(C) Rental payment assistance.

(D) Home-ownership purchase assistance.

(E) Preservation of existing affordable housing.

(F) Weatherization.

(G) Emergency repairs.

(H) Housing related support services, including homeownership education and financial counseling.

(I) Grants or loans to not-for-profit organizations engaged in addressing the affordable housing needs of low-income and moderate-income households.

Local governments may authorize housing trust funds to accept and utilize funds, property, and other resources from all proper and lawful public and private sources so long as those funds are used solely for addressing the affordable housing needs of individuals or households that may occupy low-income or moderate-income housing.

(2) A local government may create a community land trust, which may: acquire developed or undeveloped interests in real property and hold them for affordable housing purposes; convey such interests under long-term leases, including ground leases; convey such interests for affordable housing purposes; and retain an option to reacquire any such real property interests at a price determined by a formula ensuring that such interests may be utilized for affordable housing purposes.

(3) A local government may use its zoning powers to require the creation and preservation of affordable housing as authorized under Section 5-12001 of the Counties Code and Section 11-13-1 of the Illinois Municipal Code.

(4) A local government may accept donations of money or land for the purpose of addressing the affordable housing needs of individuals or households that may occupy low-income or moderate-income housing. These donations may include, without limitation, donations of money or land from persons, as long as the donations are demonstrably used to preserve, create, or subsidize low-income housing or moderate-income housing within the jurisdiction in lieu of building affordable housing.

(e) In order to encourage regional cooperation and the maximum creation of affordable housing in areas lacking such housing in the State of Illinois, any non-exempt local government may enter into intergovernmental agreements under subsection (e) of Section 25 with local governments within 10 miles of its corporate boundaries in order to create affordable housing units to meet the goals of this Act. A non-exempt local government may not enter into an intergovernmental agreement, however, with any local government that contains more than 25% affordable housing as determined under Section 20 of this Act. All intergovernmental agreements entered into to create affordable housing units to meet the goals of this Act must also specify the basis for determining how many of the affordable housing units created will be credited to each local government participating in the agreement for purposes of complying with this Act. All intergovernmental agreements entered into to create affordable housing units to meet the goals of this Act must also specify the anticipated number of newly created affordable housing units that are to be credited to each local government participating in the agreement for purposes of complying with this Act. In specifying how many affordable housing units will be credited to each local government, the same affordable housing unit may not be counted by more than one local government.

(f) To enforce compliance with the provisions of this Section, and to encourage local governments to submit their affordable housing plans to the Illinois Housing Development Authority in a timely manner, the Illinois Housing Development Authority shall notify any local government and may notify the Office of the Attorney General that the local government is in violation of State law if the Illinois Housing Development Authority finds that the affordable housing plan submitted is not in substantial compliance with this Section or that the local government failed to submit an affordable housing plan. The Attorney General may enforce this provision of the Act by an action for mandamus or injunction or by means of other appropriate relief.

(Source: P.A. 98-287, eff. 8-9-13.)

(310 ILCS 67/50)

Sec. 50. Housing Appeals Board.

(a) Prior to January 1, 2008, a Housing Appeals Board shall be created consisting of 7 members appointed by the Governor as follows:

(1) a retired circuit judge or retired appellate judge, who shall act as chairperson;

(2) a zoning board of appeals member;

(3) a planning board member;

(4) a mayor or municipal council or board member;

(5) a county board member;

(6) an affordable housing developer; and

(7) an affordable housing advocate.

In addition, the Chairman of the Illinois Housing Development Authority, ex officio, shall serve as a non-voting member. No more than 4 of the appointed members may be from the same political party. Appointments under items (2), (3), and (4) shall be from local governments that are not exempt under this Act.

(b) Initial terms of 4 members designated by the Governor shall be for 2 years. Initial terms of 3 members designated by the Governor shall be for one year. Thereafter, members shall be appointed for terms of 2 years. After a member's term expires, the member shall continue to serve until a successor is appointed. There shall be no limit to the number of terms an appointee may serve. A member shall receive no compensation for his or her services, but shall be reimbursed by the State for all reasonable expenses actually and necessarily incurred in the performance of his or her official duties. The board shall hear all petitions for review filed under this Act and shall conduct all hearings in accordance with the rules and regulations established by the chairperson. The Illinois Housing Development Authority shall provide space and clerical and other assistance that the Board may require.

(c) (Blank).

(d) Any vacancies in the Housing Appeals Board shall be filled within 90 days of the vacancy.

(Source: P.A. 98-287, eff. 8-9-13.)

(310 ILCS 67/70 new)

Sec. 70. Home rule application. Unless otherwise provided under this Act or otherwise in accordance with State law, a unit of local government, including a home rule unit, or any non-home rule county within the unincorporated territory of the county, may not regulate the activities described in this Act in a manner more restrictive than the regulation of those activities by the State under this Act. This Section is a limitation under subsection (i) of Section 6 of Article VII of the Illinois Constitution on the concurrent exercise by home rule units of powers and functions exercised by the State.

Article 99. Effective Date

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