HB4161 103RD GENERAL ASSEMBLY

LRB103 34685 AWJ 64530 b

103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB4161

Introduced , by Rep. La Shawn K. Ford

SYNOPSIS AS INTRODUCED:

See Index

Amends the Industrial Hemp Act. Changes the short title of the Act to the Hemp Act. Permits the wholesale and retail sale of cannabinoids, hemp concentrate, or any other intermediate hemp cannabinoid products. Provides that no person shall offer or sell cannabinoid products, particularly packaged hemp products, to consumers in the State unless the person applies for and holds a hemp retailer license issued by the Department of Financial and Professional Regulation. Provides that no person shall sell ready-to-eat hemp products to end consumers without applying for and holding a hemp food establishment license issued by the Department of Public Health. Provides that no person shall sell cannabinoid product to any person under the age of 21 unless the person is a medical cardholder registered under the Compassionate Use of Medical Cannabis Program Act. Provides that the Department of Agriculture may not limit the number of hemp farm licenses. Provides that no person shall cultivate or grow hemp for commercial purposes unless licensed by the Department of Agriculture and subject to the rules of the Department. Provides that hemp farms may not create hemp extractions without a processor license. Provides that hemp farms may not engage in retail sales without a hemp retailer license. Provides that hemp farms may not create hemp extractions without a processor license. Provides that hemp farms may not engage in retail sales without a hemp retailer license. Creates in the State treasury a special fund known as the Hemp Social Equity Fund. Provides that 25% of all moneys deposited into the Hemp Regulatory Fund shall be transferred into the Hemp Social Equity Fund. Provides that, beginning on July 1, 2024, a tax is imposed upon purchases of all hemp cannabinoid products (hemp cannabinoid products for inhalation, hemp cannabinoid products for ingestion, and ready-to-eat hemp cannabinoid products) at a rate of 5% of the purchase price of the cannabinoid products. Defines terms. Preempts home rule powers. Amends the State Finance Act, Cannabis Regulation and Tax Act, the Illinois Noxious Weed Law, the Cannabis Control Act, the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act to make conforming changes. Effective immediately.

A BILL FOR

AN ACT concerning regulation.

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

Section 5. The Use Tax Act is amended by changing Section 9 as follows:

(35 ILCS 105/9) (from Ch. 120, par. 439.9)

Sec. 9. Except as to motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, each retailer required or authorized to collect the tax imposed by this Act shall pay to the Department the amount of such tax (except as otherwise provided) at the time when he is required to file his return for the period during which such tax was collected, less a discount of 2.1% prior to January 1, 1990, and 1.75% on and after January 1, 1990, or $5 per calendar year, whichever is greater, which is allowed to reimburse the retailer for expenses incurred in collecting the tax, keeping records, preparing and filing returns, remitting the tax and supplying data to the Department on request. When determining the discount allowed under this Section, retailers shall include the amount of tax that would have been due at the 6.25% rate but for the 1.25% rate imposed on sales tax holiday items under Public Act 102-700 this amendatory Act of the 102nd General Assembly. The discount under this Section is not allowed for the 1.25% portion of taxes paid on aviation fuel that is subject to the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133. When determining the discount allowed under this Section, retailers shall include the amount of tax that would have been due at the 1% rate but for the 0% rate imposed under Public Act 102-700 this amendatory Act of the 102nd General Assembly. In the case of retailers who report and pay the tax on a transaction by transaction basis, as provided in this Section, such discount shall be taken with each such tax remittance instead of when such retailer files his periodic return. The discount allowed under this Section is allowed only for returns that are filed in the manner required by this Act. The Department may disallow the discount for retailers whose certificate of registration is revoked at the time the return is filed, but only if the Department's decision to revoke the certificate of registration has become final. A retailer need not remit that part of any tax collected by him to the extent that he is required to remit and does remit the tax imposed by the Retailers' Occupation Tax Act, with respect to the sale of the same property.

Where such tangible personal property is sold under a conditional sales contract, or under any other form of sale wherein the payment of the principal sum, or a part thereof, is extended beyond the close of the period for which the return is filed, the retailer, in collecting the tax (except as to motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State), may collect for each tax return period, only the tax applicable to that part of the selling price actually received during such tax return period.

Except as provided in this Section, on or before the twentieth day of each calendar month, such retailer shall file a return for the preceding calendar month. Such return shall be filed on forms prescribed by the Department and shall furnish such information as the Department may reasonably require. The return shall include the gross receipts on food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, food consisting of or infused with adult use cannabis, soft drinks, and food that has been prepared for immediate consumption) which were received during the preceding calendar month, quarter, or year, as appropriate, and upon which tax would have been due but for the 0% rate imposed under Public Act 102-700 this amendatory Act of the 102nd General Assembly. The return shall also include the amount of tax that would have been due on food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, food consisting of or infused with adult use cannabis, soft drinks, and food that has been prepared for immediate consumption) but for the 0% rate imposed under Public Act 102-700 this amendatory Act of the 102nd General Assembly.

On and after January 1, 2018, except for returns required to be filed prior to January 1, 2023 for motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, with respect to retailers whose annual gross receipts average $20,000 or more, all returns required to be filed pursuant to this Act shall be filed electronically. On and after January 1, 2023, with respect to retailers whose annual gross receipts average $20,000 or more, all returns required to be filed pursuant to this Act, including, but not limited to, returns for motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, shall be filed electronically. Retailers who demonstrate that they do not have access to the Internet or demonstrate hardship in filing electronically may petition the Department to waive the electronic filing requirement.

The Department may require returns to be filed on a quarterly basis. If so required, a return for each calendar quarter shall be filed on or before the twentieth day of the calendar month following the end of such calendar quarter. The taxpayer shall also file a return with the Department for each of the first two months of each calendar quarter, on or before the twentieth day of the following calendar month, stating:

1. The name of the seller;

2. The address of the principal place of business from which he engages in the business of selling tangible personal property at retail in this State;

3. The total amount of taxable receipts received by him during the preceding calendar month from sales of tangible personal property by him during such preceding calendar month, including receipts from charge and time sales, but less all deductions allowed by law;

4. The amount of credit provided in Section 2d of this Act;

5. The amount of tax due;

5-5. The signature of the taxpayer; and

6. Such other reasonable information as the Department may require.

Each retailer required or authorized to collect the tax imposed by this Act on aviation fuel sold at retail in this State during the preceding calendar month shall, instead of reporting and paying tax on aviation fuel as otherwise required by this Section, report and pay such tax on a separate aviation fuel tax return. The requirements related to the return shall be as otherwise provided in this Section. Notwithstanding any other provisions of this Act to the contrary, retailers collecting tax on aviation fuel shall file all aviation fuel tax returns and shall make all aviation fuel tax payments by electronic means in the manner and form required by the Department. For purposes of this Section, "aviation fuel" means jet fuel and aviation gasoline.

If a taxpayer fails to sign a return within 30 days after the proper notice and demand for signature by the Department, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed.

Notwithstanding any other provision of this Act to the contrary, retailers subject to tax on cannabis shall file all cannabis tax returns and shall make all cannabis tax payments by electronic means in the manner and form required by the Department.

Notwithstanding any other provision of this Act to the contrary, retailers subject to a cannabinoid retail tax under the Hemp Act shall file all cannabinoid retail tax returns and shall make all cannabinoid retail tax payments by electronic means in the manner and form required by the Department.

Beginning October 1, 1993, a taxpayer who has an average monthly tax liability of $150,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1994, a taxpayer who has an average monthly tax liability of $100,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1995, a taxpayer who has an average monthly tax liability of $50,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 2000, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments required by rules of the Department by electronic funds transfer. The term "annual tax liability" shall be the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year. The term "average monthly tax liability" means the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year divided by 12. Beginning on October 1, 2002, a taxpayer who has a tax liability in the amount set forth in subsection (b) of Section 2505-210 of the Department of Revenue Law shall make all payments required by rules of the Department by electronic funds transfer.

Before August 1 of each year beginning in 1993, the Department shall notify all taxpayers required to make payments by electronic funds transfer. All taxpayers required to make payments by electronic funds transfer shall make those payments for a minimum of one year beginning on October 1.

Any taxpayer not required to make payments by electronic funds transfer may make payments by electronic funds transfer with the permission of the Department.

All taxpayers required to make payment by electronic funds transfer and any taxpayers authorized to voluntarily make payments by electronic funds transfer shall make those payments in the manner authorized by the Department.

The Department shall adopt such rules as are necessary to effectuate a program of electronic funds transfer and the requirements of this Section.

Before October 1, 2000, if the taxpayer's average monthly tax liability to the Department under this Act, the Retailers' Occupation Tax Act, the Service Occupation Tax Act, the Service Use Tax Act was $10,000 or more during the preceding 4 complete calendar quarters, he shall file a return with the Department each month by the 20th day of the month next following the month during which such tax liability is incurred and shall make payments to the Department on or before the 7th, 15th, 22nd and last day of the month during which such liability is incurred. On and after October 1, 2000, if the taxpayer's average monthly tax liability to the Department under this Act, the Retailers' Occupation Tax Act, the Service Occupation Tax Act, and the Service Use Tax Act was $20,000 or more during the preceding 4 complete calendar quarters, he shall file a return with the Department each month by the 20th day of the month next following the month during which such tax liability is incurred and shall make payment to the Department on or before the 7th, 15th, 22nd and last day of the month during which such liability is incurred. If the month during which such tax liability is incurred began prior to January 1, 1985, each payment shall be in an amount equal to 1/4 of the taxpayer's actual liability for the month or an amount set by the Department not to exceed 1/4 of the average monthly liability of the taxpayer to the Department for the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability in such 4 quarter period). If the month during which such tax liability is incurred begins on or after January 1, 1985, and prior to January 1, 1987, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 27.5% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1987, and prior to January 1, 1988, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 26.25% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1988, and prior to January 1, 1989, or begins on or after January 1, 1996, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1989, and prior to January 1, 1996, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year or 100% of the taxpayer's actual liability for the quarter monthly reporting period. The amount of such quarter monthly payments shall be credited against the final tax liability of the taxpayer's return for that month. Before October 1, 2000, once applicable, the requirement of the making of quarter monthly payments to the Department shall continue until such taxpayer's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $9,000, or until such taxpayer's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarter period is less than $10,000. However, if a taxpayer can show the Department that a substantial change in the taxpayer's business has occurred which causes the taxpayer to anticipate that his average monthly tax liability for the reasonably foreseeable future will fall below the $10,000 threshold stated above, then such taxpayer may petition the Department for change in such taxpayer's reporting status. On and after October 1, 2000, once applicable, the requirement of the making of quarter monthly payments to the Department shall continue until such taxpayer's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $19,000 or until such taxpayer's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarter period is less than $20,000. However, if a taxpayer can show the Department that a substantial change in the taxpayer's business has occurred which causes the taxpayer to anticipate that his average monthly tax liability for the reasonably foreseeable future will fall below the $20,000 threshold stated above, then such taxpayer may petition the Department for a change in such taxpayer's reporting status. The Department shall change such taxpayer's reporting status unless it finds that such change is seasonal in nature and not likely to be long term. Quarter monthly payment status shall be determined under this paragraph as if the rate reduction to 1.25% in Public Act 102-700 this amendatory Act of the 102nd General Assembly on sales tax holiday items had not occurred. For quarter monthly payments due on or after July 1, 2023 and through June 30, 2024, "25% of the taxpayer's liability for the same calendar month of the preceding year" shall be determined as if the rate reduction to 1.25% in Public Act 102-700 this amendatory Act of the 102nd General Assembly on sales tax holiday items had not occurred. Quarter monthly payment status shall be determined under this paragraph as if the rate reduction to 0% in Public Act 102-700 this amendatory Act of the 102nd General Assembly on food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, food consisting of or infused with adult use cannabis, soft drinks, and food that has been prepared for immediate consumption) had not occurred. For quarter monthly payments due under this paragraph on or after July 1, 2023 and through June 30, 2024, "25% of the taxpayer's liability for the same calendar month of the preceding year" shall be determined as if the rate reduction to 0% in Public Act 102-700 this amendatory Act of the 102nd General Assembly had not occurred. If any such quarter monthly payment is not paid at the time or in the amount required by this Section, then the taxpayer shall be liable for penalties and interest on the difference between the minimum amount due and the amount of such quarter monthly payment actually and timely paid, except insofar as the taxpayer has previously made payments for that month to the Department in excess of the minimum payments previously due as provided in this Section. The Department shall make reasonable rules and regulations to govern the quarter monthly payment amount and quarter monthly payment dates for taxpayers who file on other than a calendar monthly basis.

If any such payment provided for in this Section exceeds the taxpayer's liabilities under this Act, the Retailers' Occupation Tax Act, the Service Occupation Tax Act and the Service Use Tax Act, as shown by an original monthly return, the Department shall issue to the taxpayer a credit memorandum no later than 30 days after the date of payment, which memorandum may be submitted by the taxpayer to the Department in payment of tax liability subsequently to be remitted by the taxpayer to the Department or be assigned by the taxpayer to a similar taxpayer under this Act, the Retailers' Occupation Tax Act, the Service Occupation Tax Act or the Service Use Tax Act, in accordance with reasonable rules and regulations to be prescribed by the Department, except that if such excess payment is shown on an original monthly return and is made after December 31, 1986, no credit memorandum shall be issued, unless requested by the taxpayer. If no such request is made, the taxpayer may credit such excess payment against tax liability subsequently to be remitted by the taxpayer to the Department under this Act, the Retailers' Occupation Tax Act, the Service Occupation Tax Act or the Service Use Tax Act, in accordance with reasonable rules and regulations prescribed by the Department. If the Department subsequently determines that all or any part of the credit taken was not actually due to the taxpayer, the taxpayer's 2.1% or 1.75% vendor's discount shall be reduced by 2.1% or 1.75% of the difference between the credit taken and that actually due, and the taxpayer shall be liable for penalties and interest on such difference.

If the retailer is otherwise required to file a monthly return and if the retailer's average monthly tax liability to the Department does not exceed $200, the Department may authorize his returns to be filed on a quarter annual basis, with the return for January, February, and March of a given year being due by April 20 of such year; with the return for April, May and June of a given year being due by July 20 of such year; with the return for July, August and September of a given year being due by October 20 of such year, and with the return for October, November and December of a given year being due by January 20 of the following year.

If the retailer is otherwise required to file a monthly or quarterly return and if the retailer's average monthly tax liability to the Department does not exceed $50, the Department may authorize his returns to be filed on an annual basis, with the return for a given year being due by January 20 of the following year.

Such quarter annual and annual returns, as to form and substance, shall be subject to the same requirements as monthly returns.

Notwithstanding any other provision in this Act concerning the time within which a retailer may file his return, in the case of any retailer who ceases to engage in a kind of business which makes him responsible for filing returns under this Act, such retailer shall file a final return under this Act with the Department not more than one month after discontinuing such business.

In addition, with respect to motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, except as otherwise provided in this Section, every retailer selling this kind of tangible personal property shall file, with the Department, upon a form to be prescribed and supplied by the Department, a separate return for each such item of tangible personal property which the retailer sells, except that if, in the same transaction, (i) a retailer of aircraft, watercraft, motor vehicles or trailers transfers more than one aircraft, watercraft, motor vehicle or trailer to another aircraft, watercraft, motor vehicle or trailer retailer for the purpose of resale or (ii) a retailer of aircraft, watercraft, motor vehicles, or trailers transfers more than one aircraft, watercraft, motor vehicle, or trailer to a purchaser for use as a qualifying rolling stock as provided in Section 3-55 of this Act, then that seller may report the transfer of all the aircraft, watercraft, motor vehicles or trailers involved in that transaction to the Department on the same uniform invoice-transaction reporting return form. For purposes of this Section, "watercraft" means a Class 2, Class 3, or Class 4 watercraft as defined in Section 3-2 of the Boat Registration and Safety Act, a personal watercraft, or any boat equipped with an inboard motor.

In addition, with respect to motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, every person who is engaged in the business of leasing or renting such items and who, in connection with such business, sells any such item to a retailer for the purpose of resale is, notwithstanding any other provision of this Section to the contrary, authorized to meet the return-filing requirement of this Act by reporting the transfer of all the aircraft, watercraft, motor vehicles, or trailers transferred for resale during a month to the Department on the same uniform invoice-transaction reporting return form on or before the 20th of the month following the month in which the transfer takes place. Notwithstanding any other provision of this Act to the contrary, all returns filed under this paragraph must be filed by electronic means in the manner and form as required by the Department.

The transaction reporting return in the case of motor vehicles or trailers that are required to be registered with an agency of this State, shall be the same document as the Uniform Invoice referred to in Section 5-402 of the Illinois Vehicle Code and must show the name and address of the seller; the name and address of the purchaser; the amount of the selling price including the amount allowed by the retailer for traded-in property, if any; the amount allowed by the retailer for the traded-in tangible personal property, if any, to the extent to which Section 2 of this Act allows an exemption for the value of traded-in property; the balance payable after deducting such trade-in allowance from the total selling price; the amount of tax due from the retailer with respect to such transaction; the amount of tax collected from the purchaser by the retailer on such transaction (or satisfactory evidence that such tax is not due in that particular instance, if that is claimed to be the fact); the place and date of the sale; a sufficient identification of the property sold; such other information as is required in Section 5-402 of the Illinois Vehicle Code, and such other information as the Department may reasonably require.

The transaction reporting return in the case of watercraft and aircraft must show the name and address of the seller; the name and address of the purchaser; the amount of the selling price including the amount allowed by the retailer for traded-in property, if any; the amount allowed by the retailer for the traded-in tangible personal property, if any, to the extent to which Section 2 of this Act allows an exemption for the value of traded-in property; the balance payable after deducting such trade-in allowance from the total selling price; the amount of tax due from the retailer with respect to such transaction; the amount of tax collected from the purchaser by the retailer on such transaction (or satisfactory evidence that such tax is not due in that particular instance, if that is claimed to be the fact); the place and date of the sale, a sufficient identification of the property sold, and such other information as the Department may reasonably require.

Such transaction reporting return shall be filed not later than 20 days after the date of delivery of the item that is being sold, but may be filed by the retailer at any time sooner than that if he chooses to do so. The transaction reporting return and tax remittance or proof of exemption from the tax that is imposed by this Act may be transmitted to the Department by way of the State agency with which, or State officer with whom, the tangible personal property must be titled or registered (if titling or registration is required) if the Department and such agency or State officer determine that this procedure will expedite the processing of applications for title or registration.

With each such transaction reporting return, the retailer shall remit the proper amount of tax due (or shall submit satisfactory evidence that the sale is not taxable if that is the case), to the Department or its agents, whereupon the Department shall issue, in the purchaser's name, a tax receipt (or a certificate of exemption if the Department is satisfied that the particular sale is tax exempt) which such purchaser may submit to the agency with which, or State officer with whom, he must title or register the tangible personal property that is involved (if titling or registration is required) in support of such purchaser's application for an Illinois certificate or other evidence of title or registration to such tangible personal property.

No retailer's failure or refusal to remit tax under this Act precludes a user, who has paid the proper tax to the retailer, from obtaining his certificate of title or other evidence of title or registration (if titling or registration is required) upon satisfying the Department that such user has paid the proper tax (if tax is due) to the retailer. The Department shall adopt appropriate rules to carry out the mandate of this paragraph.

If the user who would otherwise pay tax to the retailer wants the transaction reporting return filed and the payment of tax or proof of exemption made to the Department before the retailer is willing to take these actions and such user has not paid the tax to the retailer, such user may certify to the fact of such delay by the retailer, and may (upon the Department being satisfied of the truth of such certification) transmit the information required by the transaction reporting return and the remittance for tax or proof of exemption directly to the Department and obtain his tax receipt or exemption determination, in which event the transaction reporting return and tax remittance (if a tax payment was required) shall be credited by the Department to the proper retailer's account with the Department, but without the 2.1% or 1.75% discount provided for in this Section being allowed. When the user pays the tax directly to the Department, he shall pay the tax in the same amount and in the same form in which it would be remitted if the tax had been remitted to the Department by the retailer.

Where a retailer collects the tax with respect to the selling price of tangible personal property which he sells and the purchaser thereafter returns such tangible personal property and the retailer refunds the selling price thereof to the purchaser, such retailer shall also refund, to the purchaser, the tax so collected from the purchaser. When filing his return for the period in which he refunds such tax to the purchaser, the retailer may deduct the amount of the tax so refunded by him to the purchaser from any other use tax which such retailer may be required to pay or remit to the Department, as shown by such return, if the amount of the tax to be deducted was previously remitted to the Department by such retailer. If the retailer has not previously remitted the amount of such tax to the Department, he is entitled to no deduction under this Act upon refunding such tax to the purchaser.

Any retailer filing a return under this Section shall also include (for the purpose of paying tax thereon) the total tax covered by such return upon the selling price of tangible personal property purchased by him at retail from a retailer, but as to which the tax imposed by this Act was not collected from the retailer filing such return, and such retailer shall remit the amount of such tax to the Department when filing such return.

If experience indicates such action to be practicable, the Department may prescribe and furnish a combination or joint return which will enable retailers, who are required to file returns hereunder and also under the Retailers' Occupation Tax Act, to furnish all the return information required by both Acts on the one form.

Where the retailer has more than one business registered with the Department under separate registration under this Act, such retailer may not file each return that is due as a single return covering all such registered businesses, but shall file separate returns for each such registered business.

Beginning January 1, 1990, each month the Department shall pay into the State and Local Sales Tax Reform Fund, a special fund in the State Treasury which is hereby created, the net revenue realized for the preceding month from the 1% tax imposed under this Act.

Beginning January 1, 1990, each month the Department shall pay into the County and Mass Transit District Fund 4% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property which is purchased outside Illinois at retail from a retailer and which is titled or registered by an agency of this State's government.

Beginning January 1, 1990, each month the Department shall pay into the State and Local Sales Tax Reform Fund, a special fund in the State Treasury, 20% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property, other than (i) tangible personal property which is purchased outside Illinois at retail from a retailer and which is titled or registered by an agency of this State's government and (ii) aviation fuel sold on or after December 1, 2019. This exception for aviation fuel only applies for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

For aviation fuel sold on or after December 1, 2019, each month the Department shall pay into the State Aviation Program Fund 20% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of aviation fuel, less an amount estimated by the Department to be required for refunds of the 20% portion of the tax on aviation fuel under this Act, which amount shall be deposited into the Aviation Fuel Sales Tax Refund Fund. The Department shall only pay moneys into the State Aviation Program Fund and the Aviation Fuels Sales Tax Refund Fund under this Act for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

Beginning August 1, 2000, each month the Department shall pay into the State and Local Sales Tax Reform Fund 100% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol. If, in any month, the tax on sales tax holiday items, as defined in Section 3-6, is imposed at the rate of 1.25%, then the Department shall pay 100% of the net revenue realized for that month from the 1.25% rate on the selling price of sales tax holiday items into the State and Local Sales Tax Reform Fund.

Beginning January 1, 1990, each month the Department shall pay into the Local Government Tax Fund 16% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property which is purchased outside Illinois at retail from a retailer and which is titled or registered by an agency of this State's government.

Beginning October 1, 2009, each month the Department shall pay into the Capital Projects Fund an amount that is equal to an amount estimated by the Department to represent 80% of the net revenue realized for the preceding month from the sale of candy, grooming and hygiene products, and soft drinks that had been taxed at a rate of 1% prior to September 1, 2009 but that are now taxed at 6.25%.

Beginning July 1, 2011, each month the Department shall pay into the Clean Air Act Permit Fund 80% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of sorbents used in Illinois in the process of sorbent injection as used to comply with the Environmental Protection Act or the federal Clean Air Act, but the total payment into the Clean Air Act Permit Fund under this Act and the Retailers' Occupation Tax Act shall not exceed $2,000,000 in any fiscal year.

Beginning July 1, 2013, each month the Department shall pay into the Underground Storage Tank Fund from the proceeds collected under this Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act an amount equal to the average monthly deficit in the Underground Storage Tank Fund during the prior year, as certified annually by the Illinois Environmental Protection Agency, but the total payment into the Underground Storage Tank Fund under this Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act shall not exceed $18,000,000 in any State fiscal year. As used in this paragraph, the "average monthly deficit" shall be equal to the difference between the average monthly claims for payment by the fund and the average monthly revenues deposited into the fund, excluding payments made pursuant to this paragraph.

Beginning July 1, 2015, of the remainder of the moneys received by the Department under this Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act, each month the Department shall deposit $500,000 into the State Crime Laboratory Fund.

Of the remainder of the moneys received by the Department pursuant to this Act, (a) 1.75% thereof shall be paid into the Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on and after July 1, 1989, 3.8% thereof shall be paid into the Build Illinois Fund; provided, however, that if in any fiscal year the sum of (1) the aggregate of 2.2% or 3.8%, as the case may be, of the moneys received by the Department and required to be paid into the Build Illinois Fund pursuant to Section 3 of the Retailers' Occupation Tax Act, Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, and Section 9 of the Service Occupation Tax Act, such Acts being hereinafter called the "Tax Acts" and such aggregate of 2.2% or 3.8%, as the case may be, of moneys being hereinafter called the "Tax Act Amount", and (2) the amount transferred to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall be less than the Annual Specified Amount (as defined in Section 3 of the Retailers' Occupation Tax Act), an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and further provided, that if on the last business day of any month the sum of (1) the Tax Act Amount required to be deposited into the Build Illinois Bond Account in the Build Illinois Fund during such month and (2) the amount transferred during such month to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall have been less than 1/12 of the Annual Specified Amount, an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and, further provided, that in no event shall the payments required under the preceding proviso result in aggregate payments into the Build Illinois Fund pursuant to this clause (b) for any fiscal year in excess of the greater of (i) the Tax Act Amount or (ii) the Annual Specified Amount for such fiscal year; and, further provided, that the amounts payable into the Build Illinois Fund under this clause (b) shall be payable only until such time as the aggregate amount on deposit under each trust indenture securing Bonds issued and outstanding pursuant to the Build Illinois Bond Act is sufficient, taking into account any future investment income, to fully provide, in accordance with such indenture, for the defeasance of or the payment of the principal of, premium, if any, and interest on the Bonds secured by such indenture and on any Bonds expected to be issued thereafter and all fees and costs payable with respect thereto, all as certified by the Director of the Bureau of the Budget (now Governor's Office of Management and Budget). If on the last business day of any month in which Bonds are outstanding pursuant to the Build Illinois Bond Act, the aggregate of the moneys deposited in the Build Illinois Bond Account in the Build Illinois Fund in such month shall be less than the amount required to be transferred in such month from the Build Illinois Bond Account to the Build Illinois Bond Retirement and Interest Fund pursuant to Section 13 of the Build Illinois Bond Act, an amount equal to such deficiency shall be immediately paid from other moneys received by the Department pursuant to the Tax Acts to the Build Illinois Fund; provided, however, that any amounts paid to the Build Illinois Fund in any fiscal year pursuant to this sentence shall be deemed to constitute payments pursuant to clause (b) of the preceding sentence and shall reduce the amount otherwise payable for such fiscal year pursuant to clause (b) of the preceding sentence. The moneys received by the Department pursuant to this Act and required to be deposited into the Build Illinois Fund are subject to the pledge, claim and charge set forth in Section 12 of the Build Illinois Bond Act.

Subject to payment of amounts into the Build Illinois Fund as provided in the preceding paragraph or in any amendment thereto hereafter enacted, the following specified monthly installment of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority provided under Section 8.25f of the State Finance Act, but not in excess of the sums designated as "Total Deposit", shall be deposited in the aggregate from collections under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act into the McCormick Place Expansion Project Fund in the specified fiscal years.

Beginning July 20, 1993 and in each month of each fiscal year thereafter, one-eighth of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority for that fiscal year, less the amount deposited into the McCormick Place Expansion Project Fund by the State Treasurer in the respective month under subsection (g) of Section 13 of the Metropolitan Pier and Exposition Authority Act, plus cumulative deficiencies in the deposits required under this Section for previous months and years, shall be deposited into the McCormick Place Expansion Project Fund, until the full amount requested for the fiscal year, but not in excess of the amount specified above as "Total Deposit", has been deposited.

Subject to payment of amounts into the Capital Projects Fund, the Clean Air Act Permit Fund, the Build Illinois Fund, and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, for aviation fuel sold on or after December 1, 2019, the Department shall each month deposit into the Aviation Fuel Sales Tax Refund Fund an amount estimated by the Department to be required for refunds of the 80% portion of the tax on aviation fuel under this Act. The Department shall only deposit moneys into the Aviation Fuel Sales Tax Refund Fund under this paragraph for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning July 1, 1993 and ending on September 30, 2013, the Department shall each month pay into the Illinois Tax Increment Fund 0.27% of 80% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning with the receipt of the first report of taxes paid by an eligible business and continuing for a 25-year period, the Department shall each month pay into the Energy Infrastructure Fund 80% of the net revenue realized from the 6.25% general rate on the selling price of Illinois-mined coal that was sold to an eligible business. For purposes of this paragraph, the term "eligible business" means a new electric generating facility certified pursuant to Section 605-332 of the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois.

Subject to payment of amounts into the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, and the Energy Infrastructure Fund pursuant to the preceding paragraphs or in any amendments to this Section hereafter enacted, beginning on the first day of the first calendar month to occur on or after August 26, 2014 (the effective date of Public Act 98-1098), each month, from the collections made under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act, the Department shall pay into the Tax Compliance and Administration Fund, to be used, subject to appropriation, to fund additional auditors and compliance personnel at the Department of Revenue, an amount equal to 1/12 of 5% of 80% of the cash receipts collected during the preceding fiscal year by the Audit Bureau of the Department under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, the Retailers' Occupation Tax Act, and associated local occupation and use taxes administered by the Department.

Subject to payments of amounts into the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, beginning on July 1, 2018 the Department shall pay each month into the Downstate Public Transportation Fund the moneys required to be so paid under Section 2-3 of the Downstate Public Transportation Act.

Subject to successful execution and delivery of a public-private agreement between the public agency and private entity and completion of the civic build, beginning on July 1, 2023, of the remainder of the moneys received by the Department under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and this Act, the Department shall deposit the following specified deposits in the aggregate from collections under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act, as required under Section 8.25g of the State Finance Act for distribution consistent with the Public-Private Partnership for Civic and Transit Infrastructure Project Act. The moneys received by the Department pursuant to this Act and required to be deposited into the Civic and Transit Infrastructure Fund are subject to the pledge, claim, and charge set forth in Section 25-55 of the Public-Private Partnership for Civic and Transit Infrastructure Project Act. As used in this paragraph, "civic build", "private entity", "public-private agreement", and "public agency" have the meanings provided in Section 25-10 of the Public-Private Partnership for Civic and Transit Infrastructure Project Act.

Fiscal Year............................Total Deposit

2024....................................$200,000,000

2025....................................$206,000,000

2026....................................$212,200,000

2027....................................$218,500,000

2028....................................$225,100,000

2029....................................$288,700,000

2030....................................$298,900,000

2031....................................$309,300,000

2032....................................$320,100,000

2033....................................$331,200,000

2034....................................$341,200,000

2035....................................$351,400,000

2036....................................$361,900,000

2037....................................$372,800,000

2038....................................$384,000,000

2039....................................$395,500,000

2040....................................$407,400,000

2041....................................$419,600,000

2042....................................$432,200,000

2043....................................$445,100,000

Beginning July 1, 2021 and until July 1, 2022, subject to the payment of amounts into the State and Local Sales Tax Reform Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 16% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2022 and until July 1, 2023, subject to the payment of amounts into the State and Local Sales Tax Reform Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 32% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2023 and until July 1, 2024, subject to the payment of amounts into the State and Local Sales Tax Reform Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 48% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2024 and until July 1, 2025, subject to the payment of amounts into the State and Local Sales Tax Reform Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 64% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning on July 1, 2025, subject to the payment of amounts into the State and Local Sales Tax Reform Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 80% of the net revenue realized from the taxes imposed on motor fuel and gasohol. As used in this paragraph "motor fuel" has the meaning given to that term in Section 1.1 of the Motor Fuel Tax Law, and "gasohol" has the meaning given to that term in Section 3-40 of this Act.

Of the remainder of the moneys received by the Department pursuant to this Act, 75% thereof shall be paid into the State Treasury and 25% shall be reserved in a special account and used only for the transfer to the Common School Fund as part of the monthly transfer from the General Revenue Fund in accordance with Section 8a of the State Finance Act.

As soon as possible after the first day of each month, upon certification of the Department of Revenue, the Comptroller shall order transferred and the Treasurer shall transfer from the General Revenue Fund to the Motor Fuel Tax Fund an amount equal to 1.7% of 80% of the net revenue realized under this Act for the second preceding month. Beginning April 1, 2000, this transfer is no longer required and shall not be made.

Net revenue realized for a month shall be the revenue collected by the State pursuant to this Act, less the amount paid out during that month as refunds to taxpayers for overpayment of liability.

For greater simplicity of administration, manufacturers, importers and wholesalers whose products are sold at retail in Illinois by numerous retailers, and who wish to do so, may assume the responsibility for accounting and paying to the Department all tax accruing under this Act with respect to such sales, if the retailers who are affected do not make written objection to the Department to this arrangement.

(Source: P.A. 101-10, Article 15, Section 15-10, eff. 6-5-19; 101-10, Article 25, Section 25-105, eff. 6-5-19; 101-27, eff. 6-25-19; 101-32, eff. 6-28-19; 101-604, eff. 12-13-19; 101-636, eff. 6-10-20; 102-700, Article 60, Section 60-15, eff. 4-19-22; 102-700, Article 65, Section 65-5, eff. 4-19-22; 102-1019, eff. 1-1-23; revised 12-13-22.)

Section 10. The Service Use Tax Act is amended by changing Section 9 as follows:

(35 ILCS 110/9) (from Ch. 120, par. 439.39)

Sec. 9. Each serviceman required or authorized to collect the tax herein imposed shall pay to the Department the amount of such tax (except as otherwise provided) at the time when he is required to file his return for the period during which such tax was collected, less a discount of 2.1% prior to January 1, 1990 and 1.75% on and after January 1, 1990, or $5 per calendar year, whichever is greater, which is allowed to reimburse the serviceman for expenses incurred in collecting the tax, keeping records, preparing and filing returns, remitting the tax and supplying data to the Department on request. When determining the discount allowed under this Section, servicemen shall include the amount of tax that would have been due at the 1% rate but for the 0% rate imposed under this amendatory Act of the 102nd General Assembly. The discount under this Section is not allowed for the 1.25% portion of taxes paid on aviation fuel that is subject to the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133. The discount allowed under this Section is allowed only for returns that are filed in the manner required by this Act. The Department may disallow the discount for servicemen whose certificate of registration is revoked at the time the return is filed, but only if the Department's decision to revoke the certificate of registration has become final. A serviceman need not remit that part of any tax collected by him to the extent that he is required to pay and does pay the tax imposed by the Service Occupation Tax Act with respect to his sale of service involving the incidental transfer by him of the same property.

Except as provided hereinafter in this Section, on or before the twentieth day of each calendar month, such serviceman shall file a return for the preceding calendar month in accordance with reasonable Rules and Regulations to be promulgated by the Department. Such return shall be filed on a form prescribed by the Department and shall contain such information as the Department may reasonably require. The return shall include the gross receipts which were received during the preceding calendar month or quarter on the following items upon which tax would have been due but for the 0% rate imposed under this amendatory Act of the 102nd General Assembly: (i) food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, food consisting of or infused with adult use cannabis, soft drinks, and food that has been prepared for immediate consumption); and (ii) food prepared for immediate consumption and transferred incident to a sale of service subject to this Act or the Service Occupation Tax Act by an entity licensed under the Hospital Licensing Act, the Nursing Home Care Act, the Assisted Living and Shared Housing Act, the ID/DD Community Care Act, the MC/DD Act, the Specialized Mental Health Rehabilitation Act of 2013, or the Child Care Act of 1969, or an entity that holds a permit issued pursuant to the Life Care Facilities Act. The return shall also include the amount of tax that would have been due on the items listed in the previous sentence but for the 0% rate imposed under this amendatory Act of the 102nd General Assembly.

On and after January 1, 2018, with respect to servicemen whose annual gross receipts average $20,000 or more, all returns required to be filed pursuant to this Act shall be filed electronically. Servicemen who demonstrate that they do not have access to the Internet or demonstrate hardship in filing electronically may petition the Department to waive the electronic filing requirement.

The Department may require returns to be filed on a quarterly basis. If so required, a return for each calendar quarter shall be filed on or before the twentieth day of the calendar month following the end of such calendar quarter. The taxpayer shall also file a return with the Department for each of the first two months of each calendar quarter, on or before the twentieth day of the following calendar month, stating:

1. The name of the seller;

2. The address of the principal place of business from which he engages in business as a serviceman in this State;

3. The total amount of taxable receipts received by him during the preceding calendar month, including receipts from charge and time sales, but less all deductions allowed by law;

4. The amount of credit provided in Section 2d of this Act;

5. The amount of tax due;

5-5. The signature of the taxpayer; and

6. Such other reasonable information as the Department may require.

Each serviceman required or authorized to collect the tax imposed by this Act on aviation fuel transferred as an incident of a sale of service in this State during the preceding calendar month shall, instead of reporting and paying tax on aviation fuel as otherwise required by this Section, report and pay such tax on a separate aviation fuel tax return. The requirements related to the return shall be as otherwise provided in this Section. Notwithstanding any other provisions of this Act to the contrary, servicemen collecting tax on aviation fuel shall file all aviation fuel tax returns and shall make all aviation fuel tax payments by electronic means in the manner and form required by the Department. For purposes of this Section, "aviation fuel" means jet fuel and aviation gasoline.

If a taxpayer fails to sign a return within 30 days after the proper notice and demand for signature by the Department, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed.

Notwithstanding any other provision of this Act to the contrary, servicemen subject to tax on cannabis shall file all cannabis tax returns and shall make all cannabis tax payments by electronic means in the manner and form required by the Department.

Notwithstanding any other provision of this Act to the contrary, servicemen subject to a cannabinoid retail tax under the Hemp Act shall file all cannabinoid retail tax returns and shall make all cannabinoid retail tax payments by electronic means in the manner and form required by the Department.

Beginning October 1, 1993, a taxpayer who has an average monthly tax liability of $150,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1994, a taxpayer who has an average monthly tax liability of $100,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1995, a taxpayer who has an average monthly tax liability of $50,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 2000, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments required by rules of the Department by electronic funds transfer. The term "annual tax liability" shall be the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year. The term "average monthly tax liability" means the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year divided by 12. Beginning on October 1, 2002, a taxpayer who has a tax liability in the amount set forth in subsection (b) of Section 2505-210 of the Department of Revenue Law shall make all payments required by rules of the Department by electronic funds transfer.

Before August 1 of each year beginning in 1993, the Department shall notify all taxpayers required to make payments by electronic funds transfer. All taxpayers required to make payments by electronic funds transfer shall make those payments for a minimum of one year beginning on October 1.

Any taxpayer not required to make payments by electronic funds transfer may make payments by electronic funds transfer with the permission of the Department.

All taxpayers required to make payment by electronic funds transfer and any taxpayers authorized to voluntarily make payments by electronic funds transfer shall make those payments in the manner authorized by the Department.

The Department shall adopt such rules as are necessary to effectuate a program of electronic funds transfer and the requirements of this Section.

If the serviceman is otherwise required to file a monthly return and if the serviceman's average monthly tax liability to the Department does not exceed $200, the Department may authorize his returns to be filed on a quarter annual basis, with the return for January, February and March of a given year being due by April 20 of such year; with the return for April, May and June of a given year being due by July 20 of such year; with the return for July, August and September of a given year being due by October 20 of such year, and with the return for October, November and December of a given year being due by January 20 of the following year.

If the serviceman is otherwise required to file a monthly or quarterly return and if the serviceman's average monthly tax liability to the Department does not exceed $50, the Department may authorize his returns to be filed on an annual basis, with the return for a given year being due by January 20 of the following year.

Such quarter annual and annual returns, as to form and substance, shall be subject to the same requirements as monthly returns.

Notwithstanding any other provision in this Act concerning the time within which a serviceman may file his return, in the case of any serviceman who ceases to engage in a kind of business which makes him responsible for filing returns under this Act, such serviceman shall file a final return under this Act with the Department not more than 1 month after discontinuing such business.

Where a serviceman collects the tax with respect to the selling price of property which he sells and the purchaser thereafter returns such property and the serviceman refunds the selling price thereof to the purchaser, such serviceman shall also refund, to the purchaser, the tax so collected from the purchaser. When filing his return for the period in which he refunds such tax to the purchaser, the serviceman may deduct the amount of the tax so refunded by him to the purchaser from any other Service Use Tax, Service Occupation Tax, retailers' occupation tax or use tax which such serviceman may be required to pay or remit to the Department, as shown by such return, provided that the amount of the tax to be deducted shall previously have been remitted to the Department by such serviceman. If the serviceman shall not previously have remitted the amount of such tax to the Department, he shall be entitled to no deduction hereunder upon refunding such tax to the purchaser.

Any serviceman filing a return hereunder shall also include the total tax upon the selling price of tangible personal property purchased for use by him as an incident to a sale of service, and such serviceman shall remit the amount of such tax to the Department when filing such return.

If experience indicates such action to be practicable, the Department may prescribe and furnish a combination or joint return which will enable servicemen, who are required to file returns hereunder and also under the Service Occupation Tax Act, to furnish all the return information required by both Acts on the one form.

Where the serviceman has more than one business registered with the Department under separate registration hereunder, such serviceman shall not file each return that is due as a single return covering all such registered businesses, but shall file separate returns for each such registered business.

Beginning January 1, 1990, each month the Department shall pay into the State and Local Tax Reform Fund, a special fund in the State Treasury, the net revenue realized for the preceding month from the 1% tax imposed under this Act.

Beginning January 1, 1990, each month the Department shall pay into the State and Local Sales Tax Reform Fund 20% of the net revenue realized for the preceding month from the 6.25% general rate on transfers of tangible personal property, other than (i) tangible personal property which is purchased outside Illinois at retail from a retailer and which is titled or registered by an agency of this State's government and (ii) aviation fuel sold on or after December 1, 2019. This exception for aviation fuel only applies for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

For aviation fuel sold on or after December 1, 2019, each month the Department shall pay into the State Aviation Program Fund 20% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of aviation fuel, less an amount estimated by the Department to be required for refunds of the 20% portion of the tax on aviation fuel under this Act, which amount shall be deposited into the Aviation Fuel Sales Tax Refund Fund. The Department shall only pay moneys into the State Aviation Program Fund and the Aviation Fuel Sales Tax Refund Fund under this Act for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

Beginning August 1, 2000, each month the Department shall pay into the State and Local Sales Tax Reform Fund 100% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol.

Beginning October 1, 2009, each month the Department shall pay into the Capital Projects Fund an amount that is equal to an amount estimated by the Department to represent 80% of the net revenue realized for the preceding month from the sale of candy, grooming and hygiene products, and soft drinks that had been taxed at a rate of 1% prior to September 1, 2009 but that are now taxed at 6.25%.

Beginning July 1, 2013, each month the Department shall pay into the Underground Storage Tank Fund from the proceeds collected under this Act, the Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act an amount equal to the average monthly deficit in the Underground Storage Tank Fund during the prior year, as certified annually by the Illinois Environmental Protection Agency, but the total payment into the Underground Storage Tank Fund under this Act, the Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act shall not exceed $18,000,000 in any State fiscal year. As used in this paragraph, the "average monthly deficit" shall be equal to the difference between the average monthly claims for payment by the fund and the average monthly revenues deposited into the fund, excluding payments made pursuant to this paragraph.

Beginning July 1, 2015, of the remainder of the moneys received by the Department under the Use Tax Act, this Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act, each month the Department shall deposit $500,000 into the State Crime Laboratory Fund.

Of the remainder of the moneys received by the Department pursuant to this Act, (a) 1.75% thereof shall be paid into the Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on and after July 1, 1989, 3.8% thereof shall be paid into the Build Illinois Fund; provided, however, that if in any fiscal year the sum of (1) the aggregate of 2.2% or 3.8%, as the case may be, of the moneys received by the Department and required to be paid into the Build Illinois Fund pursuant to Section 3 of the Retailers' Occupation Tax Act, Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, and Section 9 of the Service Occupation Tax Act, such Acts being hereinafter called the "Tax Acts" and such aggregate of 2.2% or 3.8%, as the case may be, of moneys being hereinafter called the "Tax Act Amount", and (2) the amount transferred to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall be less than the Annual Specified Amount (as defined in Section 3 of the Retailers' Occupation Tax Act), an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and further provided, that if on the last business day of any month the sum of (1) the Tax Act Amount required to be deposited into the Build Illinois Bond Account in the Build Illinois Fund during such month and (2) the amount transferred during such month to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall have been less than 1/12 of the Annual Specified Amount, an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and, further provided, that in no event shall the payments required under the preceding proviso result in aggregate payments into the Build Illinois Fund pursuant to this clause (b) for any fiscal year in excess of the greater of (i) the Tax Act Amount or (ii) the Annual Specified Amount for such fiscal year; and, further provided, that the amounts payable into the Build Illinois Fund under this clause (b) shall be payable only until such time as the aggregate amount on deposit under each trust indenture securing Bonds issued and outstanding pursuant to the Build Illinois Bond Act is sufficient, taking into account any future investment income, to fully provide, in accordance with such indenture, for the defeasance of or the payment of the principal of, premium, if any, and interest on the Bonds secured by such indenture and on any Bonds expected to be issued thereafter and all fees and costs payable with respect thereto, all as certified by the Director of the Bureau of the Budget (now Governor's Office of Management and Budget). If on the last business day of any month in which Bonds are outstanding pursuant to the Build Illinois Bond Act, the aggregate of the moneys deposited in the Build Illinois Bond Account in the Build Illinois Fund in such month shall be less than the amount required to be transferred in such month from the Build Illinois Bond Account to the Build Illinois Bond Retirement and Interest Fund pursuant to Section 13 of the Build Illinois Bond Act, an amount equal to such deficiency shall be immediately paid from other moneys received by the Department pursuant to the Tax Acts to the Build Illinois Fund; provided, however, that any amounts paid to the Build Illinois Fund in any fiscal year pursuant to this sentence shall be deemed to constitute payments pursuant to clause (b) of the preceding sentence and shall reduce the amount otherwise payable for such fiscal year pursuant to clause (b) of the preceding sentence. The moneys received by the Department pursuant to this Act and required to be deposited into the Build Illinois Fund are subject to the pledge, claim and charge set forth in Section 12 of the Build Illinois Bond Act.

Subject to payment of amounts into the Build Illinois Fund as provided in the preceding paragraph or in any amendment thereto hereafter enacted, the following specified monthly installment of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority provided under Section 8.25f of the State Finance Act, but not in excess of the sums designated as "Total Deposit", shall be deposited in the aggregate from collections under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act into the McCormick Place Expansion Project Fund in the specified fiscal years.

Beginning July 20, 1993 and in each month of each fiscal year thereafter, one-eighth of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority for that fiscal year, less the amount deposited into the McCormick Place Expansion Project Fund by the State Treasurer in the respective month under subsection (g) of Section 13 of the Metropolitan Pier and Exposition Authority Act, plus cumulative deficiencies in the deposits required under this Section for previous months and years, shall be deposited into the McCormick Place Expansion Project Fund, until the full amount requested for the fiscal year, but not in excess of the amount specified above as "Total Deposit", has been deposited.

Subject to payment of amounts into the Capital Projects Fund, the Clean Air Act Permit Fund, the Build Illinois Fund, and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, for aviation fuel sold on or after December 1, 2019, the Department shall each month deposit into the Aviation Fuel Sales Tax Refund Fund an amount estimated by the Department to be required for refunds of the 80% portion of the tax on aviation fuel under this Act. The Department shall only deposit moneys into the Aviation Fuel Sales Tax Refund Fund under this paragraph for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning July 1, 1993 and ending on September 30, 2013, the Department shall each month pay into the Illinois Tax Increment Fund 0.27% of 80% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning with the receipt of the first report of taxes paid by an eligible business and continuing for a 25-year period, the Department shall each month pay into the Energy Infrastructure Fund 80% of the net revenue realized from the 6.25% general rate on the selling price of Illinois-mined coal that was sold to an eligible business. For purposes of this paragraph, the term "eligible business" means a new electric generating facility certified pursuant to Section 605-332 of the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois.

Subject to payment of amounts into the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, and the Energy Infrastructure Fund pursuant to the preceding paragraphs or in any amendments to this Section hereafter enacted, beginning on the first day of the first calendar month to occur on or after August 26, 2014 (the effective date of Public Act 98-1098), each month, from the collections made under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act, the Department shall pay into the Tax Compliance and Administration Fund, to be used, subject to appropriation, to fund additional auditors and compliance personnel at the Department of Revenue, an amount equal to 1/12 of 5% of 80% of the cash receipts collected during the preceding fiscal year by the Audit Bureau of the Department under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, the Retailers' Occupation Tax Act, and associated local occupation and use taxes administered by the Department.

Subject to payments of amounts into the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, beginning on July 1, 2018 the Department shall pay each month into the Downstate Public Transportation Fund the moneys required to be so paid under Section 2-3 of the Downstate Public Transportation Act.

Subject to successful execution and delivery of a public-private agreement between the public agency and private entity and completion of the civic build, beginning on July 1, 2023, of the remainder of the moneys received by the Department under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and this Act, the Department shall deposit the following specified deposits in the aggregate from collections under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act, as required under Section 8.25g of the State Finance Act for distribution consistent with the Public-Private Partnership for Civic and Transit Infrastructure Project Act. The moneys received by the Department pursuant to this Act and required to be deposited into the Civic and Transit Infrastructure Fund are subject to the pledge, claim, and charge set forth in Section 25-55 of the Public-Private Partnership for Civic and Transit Infrastructure Project Act. As used in this paragraph, "civic build", "private entity", "public-private agreement", and "public agency" have the meanings provided in Section 25-10 of the Public-Private Partnership for Civic and Transit Infrastructure Project Act.

Fiscal Year............................Total Deposit

2024....................................$200,000,000

2025....................................$206,000,000

2026....................................$212,200,000

2027....................................$218,500,000

2028....................................$225,100,000

2029....................................$288,700,000

2030....................................$298,900,000

2031....................................$309,300,000

2032....................................$320,100,000

2033....................................$331,200,000

2034....................................$341,200,000

2035....................................$351,400,000

2036....................................$361,900,000

2037....................................$372,800,000

2038....................................$384,000,000

2039....................................$395,500,000

2040....................................$407,400,000

2041....................................$419,600,000

2042....................................$432,200,000

2043....................................$445,100,000

Beginning July 1, 2021 and until July 1, 2022, subject to the payment of amounts into the State and Local Sales Tax Reform Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 16% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2022 and until July 1, 2023, subject to the payment of amounts into the State and Local Sales Tax Reform Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 32% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2023 and until July 1, 2024, subject to the payment of amounts into the State and Local Sales Tax Reform Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 48% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2024 and until July 1, 2025, subject to the payment of amounts into the State and Local Sales Tax Reform Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 64% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning on July 1, 2025, subject to the payment of amounts into the State and Local Sales Tax Reform Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 80% of the net revenue realized from the taxes imposed on motor fuel and gasohol. As used in this paragraph "motor fuel" has the meaning given to that term in Section 1.1 of the Motor Fuel Tax Law, and "gasohol" has the meaning given to that term in Section 3-40 of the Use Tax Act.

Of the remainder of the moneys received by the Department pursuant to this Act, 75% thereof shall be paid into the General Revenue Fund of the State Treasury and 25% shall be reserved in a special account and used only for the transfer to the Common School Fund as part of the monthly transfer from the General Revenue Fund in accordance with Section 8a of the State Finance Act.

As soon as possible after the first day of each month, upon certification of the Department of Revenue, the Comptroller shall order transferred and the Treasurer shall transfer from the General Revenue Fund to the Motor Fuel Tax Fund an amount equal to 1.7% of 80% of the net revenue realized under this Act for the second preceding month. Beginning April 1, 2000, this transfer is no longer required and shall not be made.

Net revenue realized for a month shall be the revenue collected by the State pursuant to this Act, less the amount paid out during that month as refunds to taxpayers for overpayment of liability.

(Source: P.A. 101-10, Article 15, Section 15-15, eff. 6-5-19; 101-10, Article 25, Section 25-110, eff. 6-5-19; 101-27, eff. 6-25-19; 101-32, eff. 6-28-19; 101-604, eff. 12-13-19; 101-636, eff. 6-10-20; 102-700, eff. 4-19-22.)

Section 15. The Service Occupation Tax Act is amended by changing Section 9 as follows:

(35 ILCS 115/9) (from Ch. 120, par. 439.109)

Sec. 9. Each serviceman required or authorized to collect the tax herein imposed shall pay to the Department the amount of such tax at the time when he is required to file his return for the period during which such tax was collectible, less a discount of 2.1% prior to January 1, 1990, and 1.75% on and after January 1, 1990, or $5 per calendar year, whichever is greater, which is allowed to reimburse the serviceman for expenses incurred in collecting the tax, keeping records, preparing and filing returns, remitting the tax and supplying data to the Department on request. When determining the discount allowed under this Section, servicemen shall include the amount of tax that would have been due at the 1% rate but for the 0% rate imposed under this amendatory Act of the 102nd General Assembly. The discount under this Section is not allowed for the 1.25% portion of taxes paid on aviation fuel that is subject to the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133. The discount allowed under this Section is allowed only for returns that are filed in the manner required by this Act. The Department may disallow the discount for servicemen whose certificate of registration is revoked at the time the return is filed, but only if the Department's decision to revoke the certificate of registration has become final.

Where such tangible personal property is sold under a conditional sales contract, or under any other form of sale wherein the payment of the principal sum, or a part thereof, is extended beyond the close of the period for which the return is filed, the serviceman, in collecting the tax may collect, for each tax return period, only the tax applicable to the part of the selling price actually received during such tax return period.

Except as provided hereinafter in this Section, on or before the twentieth day of each calendar month, such serviceman shall file a return for the preceding calendar month in accordance with reasonable rules and regulations to be promulgated by the Department of Revenue. Such return shall be filed on a form prescribed by the Department and shall contain such information as the Department may reasonably require. The return shall include the gross receipts which were received during the preceding calendar month or quarter on the following items upon which tax would have been due but for the 0% rate imposed under this amendatory Act of the 102nd General Assembly: (i) food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, food consisting of or infused with adult use cannabis, soft drinks, and food that has been prepared for immediate consumption); and (ii) food prepared for immediate consumption and transferred incident to a sale of service subject to this Act or the Service Use Tax Act by an entity licensed under the Hospital Licensing Act, the Nursing Home Care Act, the Assisted Living and Shared Housing Act, the ID/DD Community Care Act, the MC/DD Act, the Specialized Mental Health Rehabilitation Act of 2013, or the Child Care Act of 1969, or an entity that holds a permit issued pursuant to the Life Care Facilities Act. The return shall also include the amount of tax that would have been due on the items listed in the previous sentence but for the 0% rate imposed under this amendatory Act of the 102nd General Assembly.

On and after January 1, 2018, with respect to servicemen whose annual gross receipts average $20,000 or more, all returns required to be filed pursuant to this Act shall be filed electronically. Servicemen who demonstrate that they do not have access to the Internet or demonstrate hardship in filing electronically may petition the Department to waive the electronic filing requirement.

The Department may require returns to be filed on a quarterly basis. If so required, a return for each calendar quarter shall be filed on or before the twentieth day of the calendar month following the end of such calendar quarter. The taxpayer shall also file a return with the Department for each of the first two months of each calendar quarter, on or before the twentieth day of the following calendar month, stating:

1. The name of the seller;

2. The address of the principal place of business from which he engages in business as a serviceman in this State;

3. The total amount of taxable receipts received by him during the preceding calendar month, including receipts from charge and time sales, but less all deductions allowed by law;

4. The amount of credit provided in Section 2d of this Act;

5. The amount of tax due;

5-5. The signature of the taxpayer; and

6. Such other reasonable information as the Department may require.

Each serviceman required or authorized to collect the tax herein imposed on aviation fuel acquired as an incident to the purchase of a service in this State during the preceding calendar month shall, instead of reporting and paying tax as otherwise required by this Section, report and pay such tax on a separate aviation fuel tax return. The requirements related to the return shall be as otherwise provided in this Section. Notwithstanding any other provisions of this Act to the contrary, servicemen transferring aviation fuel incident to sales of service shall file all aviation fuel tax returns and shall make all aviation fuel tax payments by electronic means in the manner and form required by the Department. For purposes of this Section, "aviation fuel" means jet fuel and aviation gasoline.

If a taxpayer fails to sign a return within 30 days after the proper notice and demand for signature by the Department, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed.

Notwithstanding any other provision of this Act to the contrary, servicemen subject to tax on cannabis shall file all cannabis tax returns and shall make all cannabis tax payments by electronic means in the manner and form required by the Department.

Notwithstanding any other provision of this Act to the contrary, servicemen subject to a cannabinoid retail tax under the Hemp Act shall file all cannabinoid retail tax returns and shall make all cannabinoid retail tax payments by electronic means in the manner and form required by the Department.

Prior to October 1, 2003, and on and after September 1, 2004 a serviceman may accept a Manufacturer's Purchase Credit certification from a purchaser in satisfaction of Service Use Tax as provided in Section 3-70 of the Service Use Tax Act if the purchaser provides the appropriate documentation as required by Section 3-70 of the Service Use Tax Act. A Manufacturer's Purchase Credit certification, accepted prior to October 1, 2003 or on or after September 1, 2004 by a serviceman as provided in Section 3-70 of the Service Use Tax Act, may be used by that serviceman to satisfy Service Occupation Tax liability in the amount claimed in the certification, not to exceed 6.25% of the receipts subject to tax from a qualifying purchase. A Manufacturer's Purchase Credit reported on any original or amended return filed under this Act after October 20, 2003 for reporting periods prior to September 1, 2004 shall be disallowed. Manufacturer's Purchase Credit reported on annual returns due on or after January 1, 2005 will be disallowed for periods prior to September 1, 2004. No Manufacturer's Purchase Credit may be used after September 30, 2003 through August 31, 2004 to satisfy any tax liability imposed under this Act, including any audit liability.

If the serviceman's average monthly tax liability to the Department does not exceed $200, the Department may authorize his returns to be filed on a quarter annual basis, with the return for January, February and March of a given year being due by April 20 of such year; with the return for April, May and June of a given year being due by July 20 of such year; with the return for July, August and September of a given year being due by October 20 of such year, and with the return for October, November and December of a given year being due by January 20 of the following year.

If the serviceman's average monthly tax liability to the Department does not exceed $50, the Department may authorize his returns to be filed on an annual basis, with the return for a given year being due by January 20 of the following year.

Such quarter annual and annual returns, as to form and substance, shall be subject to the same requirements as monthly returns.

Notwithstanding any other provision in this Act concerning the time within which a serviceman may file his return, in the case of any serviceman who ceases to engage in a kind of business which makes him responsible for filing returns under this Act, such serviceman shall file a final return under this Act with the Department not more than 1 month after discontinuing such business.

Beginning October 1, 1993, a taxpayer who has an average monthly tax liability of $150,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1994, a taxpayer who has an average monthly tax liability of $100,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1995, a taxpayer who has an average monthly tax liability of $50,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 2000, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments required by rules of the Department by electronic funds transfer. The term "annual tax liability" shall be the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year. The term "average monthly tax liability" means the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year divided by 12. Beginning on October 1, 2002, a taxpayer who has a tax liability in the amount set forth in subsection (b) of Section 2505-210 of the Department of Revenue Law shall make all payments required by rules of the Department by electronic funds transfer.

Before August 1 of each year beginning in 1993, the Department shall notify all taxpayers required to make payments by electronic funds transfer. All taxpayers required to make payments by electronic funds transfer shall make those payments for a minimum of one year beginning on October 1.

Any taxpayer not required to make payments by electronic funds transfer may make payments by electronic funds transfer with the permission of the Department.

All taxpayers required to make payment by electronic funds transfer and any taxpayers authorized to voluntarily make payments by electronic funds transfer shall make those payments in the manner authorized by the Department.

The Department shall adopt such rules as are necessary to effectuate a program of electronic funds transfer and the requirements of this Section.

Where a serviceman collects the tax with respect to the selling price of tangible personal property which he sells and the purchaser thereafter returns such tangible personal property and the serviceman refunds the selling price thereof to the purchaser, such serviceman shall also refund, to the purchaser, the tax so collected from the purchaser. When filing his return for the period in which he refunds such tax to the purchaser, the serviceman may deduct the amount of the tax so refunded by him to the purchaser from any other Service Occupation Tax, Service Use Tax, Retailers' Occupation Tax or Use Tax which such serviceman may be required to pay or remit to the Department, as shown by such return, provided that the amount of the tax to be deducted shall previously have been remitted to the Department by such serviceman. If the serviceman shall not previously have remitted the amount of such tax to the Department, he shall be entitled to no deduction hereunder upon refunding such tax to the purchaser.

If experience indicates such action to be practicable, the Department may prescribe and furnish a combination or joint return which will enable servicemen, who are required to file returns hereunder and also under the Retailers' Occupation Tax Act, the Use Tax Act or the Service Use Tax Act, to furnish all the return information required by all said Acts on the one form.

Where the serviceman has more than one business registered with the Department under separate registrations hereunder, such serviceman shall file separate returns for each registered business.

Beginning January 1, 1990, each month the Department shall pay into the Local Government Tax Fund the revenue realized for the preceding month from the 1% tax imposed under this Act.

Beginning January 1, 1990, each month the Department shall pay into the County and Mass Transit District Fund 4% of the revenue realized for the preceding month from the 6.25% general rate on sales of tangible personal property other than aviation fuel sold on or after December 1, 2019. This exception for aviation fuel only applies for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

Beginning August 1, 2000, each month the Department shall pay into the County and Mass Transit District Fund 20% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol.

Beginning January 1, 1990, each month the Department shall pay into the Local Government Tax Fund 16% of the revenue realized for the preceding month from the 6.25% general rate on transfers of tangible personal property other than aviation fuel sold on or after December 1, 2019. This exception for aviation fuel only applies for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

For aviation fuel sold on or after December 1, 2019, each month the Department shall pay into the State Aviation Program Fund 20% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of aviation fuel, less an amount estimated by the Department to be required for refunds of the 20% portion of the tax on aviation fuel under this Act, which amount shall be deposited into the Aviation Fuel Sales Tax Refund Fund. The Department shall only pay moneys into the State Aviation Program Fund and the Aviation Fuel Sales Tax Refund Fund under this Act for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

Beginning August 1, 2000, each month the Department shall pay into the Local Government Tax Fund 80% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol.

Beginning October 1, 2009, each month the Department shall pay into the Capital Projects Fund an amount that is equal to an amount estimated by the Department to represent 80% of the net revenue realized for the preceding month from the sale of candy, grooming and hygiene products, and soft drinks that had been taxed at a rate of 1% prior to September 1, 2009 but that are now taxed at 6.25%.

Beginning July 1, 2013, each month the Department shall pay into the Underground Storage Tank Fund from the proceeds collected under this Act, the Use Tax Act, the Service Use Tax Act, and the Retailers' Occupation Tax Act an amount equal to the average monthly deficit in the Underground Storage Tank Fund during the prior year, as certified annually by the Illinois Environmental Protection Agency, but the total payment into the Underground Storage Tank Fund under this Act, the Use Tax Act, the Service Use Tax Act, and the Retailers' Occupation Tax Act shall not exceed $18,000,000 in any State fiscal year. As used in this paragraph, the "average monthly deficit" shall be equal to the difference between the average monthly claims for payment by the fund and the average monthly revenues deposited into the fund, excluding payments made pursuant to this paragraph.

Beginning July 1, 2015, of the remainder of the moneys received by the Department under the Use Tax Act, the Service Use Tax Act, this Act, and the Retailers' Occupation Tax Act, each month the Department shall deposit $500,000 into the State Crime Laboratory Fund.

Of the remainder of the moneys received by the Department pursuant to this Act, (a) 1.75% thereof shall be paid into the Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on and after July 1, 1989, 3.8% thereof shall be paid into the Build Illinois Fund; provided, however, that if in any fiscal year the sum of (1) the aggregate of 2.2% or 3.8%, as the case may be, of the moneys received by the Department and required to be paid into the Build Illinois Fund pursuant to Section 3 of the Retailers' Occupation Tax Act, Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, and Section 9 of the Service Occupation Tax Act, such Acts being hereinafter called the "Tax Acts" and such aggregate of 2.2% or 3.8%, as the case may be, of moneys being hereinafter called the "Tax Act Amount", and (2) the amount transferred to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall be less than the Annual Specified Amount (as defined in Section 3 of the Retailers' Occupation Tax Act), an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and further provided, that if on the last business day of any month the sum of (1) the Tax Act Amount required to be deposited into the Build Illinois Account in the Build Illinois Fund during such month and (2) the amount transferred during such month to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall have been less than 1/12 of the Annual Specified Amount, an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and, further provided, that in no event shall the payments required under the preceding proviso result in aggregate payments into the Build Illinois Fund pursuant to this clause (b) for any fiscal year in excess of the greater of (i) the Tax Act Amount or (ii) the Annual Specified Amount for such fiscal year; and, further provided, that the amounts payable into the Build Illinois Fund under this clause (b) shall be payable only until such time as the aggregate amount on deposit under each trust indenture securing Bonds issued and outstanding pursuant to the Build Illinois Bond Act is sufficient, taking into account any future investment income, to fully provide, in accordance with such indenture, for the defeasance of or the payment of the principal of, premium, if any, and interest on the Bonds secured by such indenture and on any Bonds expected to be issued thereafter and all fees and costs payable with respect thereto, all as certified by the Director of the Bureau of the Budget (now Governor's Office of Management and Budget). If on the last business day of any month in which Bonds are outstanding pursuant to the Build Illinois Bond Act, the aggregate of the moneys deposited in the Build Illinois Bond Account in the Build Illinois Fund in such month shall be less than the amount required to be transferred in such month from the Build Illinois Bond Account to the Build Illinois Bond Retirement and Interest Fund pursuant to Section 13 of the Build Illinois Bond Act, an amount equal to such deficiency shall be immediately paid from other moneys received by the Department pursuant to the Tax Acts to the Build Illinois Fund; provided, however, that any amounts paid to the Build Illinois Fund in any fiscal year pursuant to this sentence shall be deemed to constitute payments pursuant to clause (b) of the preceding sentence and shall reduce the amount otherwise payable for such fiscal year pursuant to clause (b) of the preceding sentence. The moneys received by the Department pursuant to this Act and required to be deposited into the Build Illinois Fund are subject to the pledge, claim and charge set forth in Section 12 of the Build Illinois Bond Act.

Subject to payment of amounts into the Build Illinois Fund as provided in the preceding paragraph or in any amendment thereto hereafter enacted, the following specified monthly installment of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority provided under Section 8.25f of the State Finance Act, but not in excess of the sums designated as "Total Deposit", shall be deposited in the aggregate from collections under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act into the McCormick Place Expansion Project Fund in the specified fiscal years.

Beginning July 20, 1993 and in each month of each fiscal year thereafter, one-eighth of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority for that fiscal year, less the amount deposited into the McCormick Place Expansion Project Fund by the State Treasurer in the respective month under subsection (g) of Section 13 of the Metropolitan Pier and Exposition Authority Act, plus cumulative deficiencies in the deposits required under this Section for previous months and years, shall be deposited into the McCormick Place Expansion Project Fund, until the full amount requested for the fiscal year, but not in excess of the amount specified above as "Total Deposit", has been deposited.

Subject to payment of amounts into the Capital Projects Fund, the Build Illinois Fund, and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, for aviation fuel sold on or after December 1, 2019, the Department shall each month deposit into the Aviation Fuel Sales Tax Refund Fund an amount estimated by the Department to be required for refunds of the 80% portion of the tax on aviation fuel under this Act. The Department shall only deposit moneys into the Aviation Fuel Sales Tax Refund Fund under this paragraph for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning July 1, 1993 and ending on September 30, 2013, the Department shall each month pay into the Illinois Tax Increment Fund 0.27% of 80% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning with the receipt of the first report of taxes paid by an eligible business and continuing for a 25-year period, the Department shall each month pay into the Energy Infrastructure Fund 80% of the net revenue realized from the 6.25% general rate on the selling price of Illinois-mined coal that was sold to an eligible business. For purposes of this paragraph, the term "eligible business" means a new electric generating facility certified pursuant to Section 605-332 of the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois.

Subject to payment of amounts into the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, and the Energy Infrastructure Fund pursuant to the preceding paragraphs or in any amendments to this Section hereafter enacted, beginning on the first day of the first calendar month to occur on or after August 26, 2014 (the effective date of Public Act 98-1098), each month, from the collections made under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act, the Department shall pay into the Tax Compliance and Administration Fund, to be used, subject to appropriation, to fund additional auditors and compliance personnel at the Department of Revenue, an amount equal to 1/12 of 5% of 80% of the cash receipts collected during the preceding fiscal year by the Audit Bureau of the Department under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, the Retailers' Occupation Tax Act, and associated local occupation and use taxes administered by the Department.

Subject to payments of amounts into the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, beginning on July 1, 2018 the Department shall pay each month into the Downstate Public Transportation Fund the moneys required to be so paid under Section 2-3 of the Downstate Public Transportation Act.

Subject to successful execution and delivery of a public-private agreement between the public agency and private entity and completion of the civic build, beginning on July 1, 2023, of the remainder of the moneys received by the Department under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and this Act, the Department shall deposit the following specified deposits in the aggregate from collections under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act, as required under Section 8.25g of the State Finance Act for distribution consistent with the Public-Private Partnership for Civic and Transit Infrastructure Project Act. The moneys received by the Department pursuant to this Act and required to be deposited into the Civic and Transit Infrastructure Fund are subject to the pledge, claim and charge set forth in Section 25-55 of the Public-Private Partnership for Civic and Transit Infrastructure Project Act. As used in this paragraph, "civic build", "private entity", "public-private agreement", and "public agency" have the meanings provided in Section 25-10 of the Public-Private Partnership for Civic and Transit Infrastructure Project Act.

Fiscal Year............................Total Deposit

2024....................................$200,000,000

2025....................................$206,000,000

2026....................................$212,200,000

2027....................................$218,500,000

2028....................................$225,100,000

2029....................................$288,700,000

2030....................................$298,900,000

2031....................................$309,300,000

2032....................................$320,100,000

2033....................................$331,200,000

2034....................................$341,200,000

2035....................................$351,400,000

2036....................................$361,900,000

2037....................................$372,800,000

2038....................................$384,000,000

2039....................................$395,500,000

2040....................................$407,400,000

2041....................................$419,600,000

2042....................................$432,200,000

2043....................................$445,100,000

Beginning July 1, 2021 and until July 1, 2022, subject to the payment of amounts into the County and Mass Transit District Fund, the Local Government Tax Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 16% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2022 and until July 1, 2023, subject to the payment of amounts into the County and Mass Transit District Fund, the Local Government Tax Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 32% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2023 and until July 1, 2024, subject to the payment of amounts into the County and Mass Transit District Fund, the Local Government Tax Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 48% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2024 and until July 1, 2025, subject to the payment of amounts into the County and Mass Transit District Fund, the Local Government Tax Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 64% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning on July 1, 2025, subject to the payment of amounts into the County and Mass Transit District Fund, the Local Government Tax Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 80% of the net revenue realized from the taxes imposed on motor fuel and gasohol. As used in this paragraph "motor fuel" has the meaning given to that term in Section 1.1 of the Motor Fuel Tax Law, and "gasohol" has the meaning given to that term in Section 3-40 of the Use Tax Act.

Of the remainder of the moneys received by the Department pursuant to this Act, 75% shall be paid into the General Revenue Fund of the State Treasury and 25% shall be reserved in a special account and used only for the transfer to the Common School Fund as part of the monthly transfer from the General Revenue Fund in accordance with Section 8a of the State Finance Act.

The Department may, upon separate written notice to a taxpayer, require the taxpayer to prepare and file with the Department on a form prescribed by the Department within not less than 60 days after receipt of the notice an annual information return for the tax year specified in the notice. Such annual return to the Department shall include a statement of gross receipts as shown by the taxpayer's last Federal income tax return. If the total receipts of the business as reported in the Federal income tax return do not agree with the gross receipts reported to the Department of Revenue for the same period, the taxpayer shall attach to his annual return a schedule showing a reconciliation of the 2 amounts and the reasons for the difference. The taxpayer's annual return to the Department shall also disclose the cost of goods sold by the taxpayer during the year covered by such return, opening and closing inventories of such goods for such year, cost of goods used from stock or taken from stock and given away by the taxpayer during such year, pay roll information of the taxpayer's business during such year and any additional reasonable information which the Department deems would be helpful in determining the accuracy of the monthly, quarterly or annual returns filed by such taxpayer as hereinbefore provided for in this Section.

If the annual information return required by this Section is not filed when and as required, the taxpayer shall be liable as follows:

(i) Until January 1, 1994, the taxpayer shall be liable for a penalty equal to 1/6 of 1% of the tax due from such taxpayer under this Act during the period to be covered by the annual return for each month or fraction of a month until such return is filed as required, the penalty to be assessed and collected in the same manner as any other penalty provided for in this Act.

(ii) On and after January 1, 1994, the taxpayer shall be liable for a penalty as described in Section 3-4 of the Uniform Penalty and Interest Act.

The chief executive officer, proprietor, owner or highest ranking manager shall sign the annual return to certify the accuracy of the information contained therein. Any person who willfully signs the annual return containing false or inaccurate information shall be guilty of perjury and punished accordingly. The annual return form prescribed by the Department shall include a warning that the person signing the return may be liable for perjury.

The foregoing portion of this Section concerning the filing of an annual information return shall not apply to a serviceman who is not required to file an income tax return with the United States Government.

As soon as possible after the first day of each month, upon certification of the Department of Revenue, the Comptroller shall order transferred and the Treasurer shall transfer from the General Revenue Fund to the Motor Fuel Tax Fund an amount equal to 1.7% of 80% of the net revenue realized under this Act for the second preceding month. Beginning April 1, 2000, this transfer is no longer required and shall not be made.

Net revenue realized for a month shall be the revenue collected by the State pursuant to this Act, less the amount paid out during that month as refunds to taxpayers for overpayment of liability.

For greater simplicity of administration, it shall be permissible for manufacturers, importers and wholesalers whose products are sold by numerous servicemen in Illinois, and who wish to do so, to assume the responsibility for accounting and paying to the Department all tax accruing under this Act with respect to such sales, if the servicemen who are affected do not make written objection to the Department to this arrangement.

(Source: P.A. 101-10, Article 15, Section 15-20, eff. 6-5-19; 101-10, Article 25, Section 25-115, eff. 6-5-19; 101-27, eff. 6-25-19; 101-32, eff. 6-28-19; 101-604, eff. 12-13-19; 101-636, eff. 6-10-20; 102-700, eff. 4-19-22.)

Section 20. The Retailers' Occupation Tax Act is amended by changing Section 3 as follows:

(35 ILCS 120/3) (from Ch. 120, par. 442)

Sec. 3. Except as provided in this Section, on or before the twentieth day of each calendar month, every person engaged in the business of selling tangible personal property at retail in this State during the preceding calendar month shall file a return with the Department, stating:

1. The name of the seller;

2. His residence address and the address of his principal place of business and the address of the principal place of business (if that is a different address) from which he engages in the business of selling tangible personal property at retail in this State;

3. Total amount of receipts received by him during the preceding calendar month or quarter, as the case may be, from sales of tangible personal property, and from services furnished, by him during such preceding calendar month or quarter;

4. Total amount received by him during the preceding calendar month or quarter on charge and time sales of tangible personal property, and from services furnished, by him prior to the month or quarter for which the return is filed;

5. Deductions allowed by law;

6. Gross receipts which were received by him during the preceding calendar month or quarter and upon the basis of which the tax is imposed, including gross receipts on food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, food consisting of or infused with adult use cannabis, soft drinks, and food that has been prepared for immediate consumption) which were received during the preceding calendar month or quarter and upon which tax would have been due but for the 0% rate imposed under Public Act 102-700 this amendatory Act of the 102nd General Assembly;

7. The amount of credit provided in Section 2d of this Act;

8. The amount of tax due, including the amount of tax that would have been due on food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, food consisting of or infused with adult use cannabis, soft drinks, and food that has been prepared for immediate consumption) but for the 0% rate imposed under Public Act 102-700 this amendatory Act of the 102nd General Assembly;

9. The signature of the taxpayer; and

10. Such other reasonable information as the Department may require.

On and after January 1, 2018, except for returns required to be filed prior to January 1, 2023 for motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, with respect to retailers whose annual gross receipts average $20,000 or more, all returns required to be filed pursuant to this Act shall be filed electronically. On and after January 1, 2023, with respect to retailers whose annual gross receipts average $20,000 or more, all returns required to be filed pursuant to this Act, including, but not limited to, returns for motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, shall be filed electronically. Retailers who demonstrate that they do not have access to the Internet or demonstrate hardship in filing electronically may petition the Department to waive the electronic filing requirement.

If a taxpayer fails to sign a return within 30 days after the proper notice and demand for signature by the Department, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed.

Each return shall be accompanied by the statement of prepaid tax issued pursuant to Section 2e for which credit is claimed.

Prior to October 1, 2003, and on and after September 1, 2004 a retailer may accept a Manufacturer's Purchase Credit certification from a purchaser in satisfaction of Use Tax as provided in Section 3-85 of the Use Tax Act if the purchaser provides the appropriate documentation as required by Section 3-85 of the Use Tax Act. A Manufacturer's Purchase Credit certification, accepted by a retailer prior to October 1, 2003 and on and after September 1, 2004 as provided in Section 3-85 of the Use Tax Act, may be used by that retailer to satisfy Retailers' Occupation Tax liability in the amount claimed in the certification, not to exceed 6.25% of the receipts subject to tax from a qualifying purchase. A Manufacturer's Purchase Credit reported on any original or amended return filed under this Act after October 20, 2003 for reporting periods prior to September 1, 2004 shall be disallowed. Manufacturer's Purchase Credit reported on annual returns due on or after January 1, 2005 will be disallowed for periods prior to September 1, 2004. No Manufacturer's Purchase Credit may be used after September 30, 2003 through August 31, 2004 to satisfy any tax liability imposed under this Act, including any audit liability.

The Department may require returns to be filed on a quarterly basis. If so required, a return for each calendar quarter shall be filed on or before the twentieth day of the calendar month following the end of such calendar quarter. The taxpayer shall also file a return with the Department for each of the first two months of each calendar quarter, on or before the twentieth day of the following calendar month, stating:

1. The name of the seller;

2. The address of the principal place of business from which he engages in the business of selling tangible personal property at retail in this State;

3. The total amount of taxable receipts received by him during the preceding calendar month from sales of tangible personal property by him during such preceding calendar month, including receipts from charge and time sales, but less all deductions allowed by law;

4. The amount of credit provided in Section 2d of this Act;

5. The amount of tax due; and

6. Such other reasonable information as the Department may require.

Every person engaged in the business of selling aviation fuel at retail in this State during the preceding calendar month shall, instead of reporting and paying tax as otherwise required by this Section, report and pay such tax on a separate aviation fuel tax return. The requirements related to the return shall be as otherwise provided in this Section. Notwithstanding any other provisions of this Act to the contrary, retailers selling aviation fuel shall file all aviation fuel tax returns and shall make all aviation fuel tax payments by electronic means in the manner and form required by the Department. For purposes of this Section, "aviation fuel" means jet fuel and aviation gasoline.

Beginning on October 1, 2003, any person who is not a licensed distributor, importing distributor, or manufacturer, as defined in the Liquor Control Act of 1934, but is engaged in the business of selling, at retail, alcoholic liquor shall file a statement with the Department of Revenue, in a format and at a time prescribed by the Department, showing the total amount paid for alcoholic liquor purchased during the preceding month and such other information as is reasonably required by the Department. The Department may adopt rules to require that this statement be filed in an electronic or telephonic format. Such rules may provide for exceptions from the filing requirements of this paragraph. For the purposes of this paragraph, the term "alcoholic liquor" shall have the meaning prescribed in the Liquor Control Act of 1934.

Beginning on October 1, 2003, every distributor, importing distributor, and manufacturer of alcoholic liquor as defined in the Liquor Control Act of 1934, shall file a statement with the Department of Revenue, no later than the 10th day of the month for the preceding month during which transactions occurred, by electronic means, showing the total amount of gross receipts from the sale of alcoholic liquor sold or distributed during the preceding month to purchasers; identifying the purchaser to whom it was sold or distributed; the purchaser's tax registration number; and such other information reasonably required by the Department. A distributor, importing distributor, or manufacturer of alcoholic liquor must personally deliver, mail, or provide by electronic means to each retailer listed on the monthly statement a report containing a cumulative total of that distributor's, importing distributor's, or manufacturer's total sales of alcoholic liquor to that retailer no later than the 10th day of the month for the preceding month during which the transaction occurred. The distributor, importing distributor, or manufacturer shall notify the retailer as to the method by which the distributor, importing distributor, or manufacturer will provide the sales information. If the retailer is unable to receive the sales information by electronic means, the distributor, importing distributor, or manufacturer shall furnish the sales information by personal delivery or by mail. For purposes of this paragraph, the term "electronic means" includes, but is not limited to, the use of a secure Internet website, e-mail, or facsimile.

If a total amount of less than $1 is payable, refundable or creditable, such amount shall be disregarded if it is less than 50 cents and shall be increased to $1 if it is 50 cents or more.

Notwithstanding any other provision of this Act to the contrary, retailers subject to tax on cannabis shall file all cannabis tax returns and shall make all cannabis tax payments by electronic means in the manner and form required by the Department.

Notwithstanding any other provision of this Act to the contrary, retailers subject to a cannabinoid retail tax under the Hemp Act shall file all cannabinoid retail tax returns and shall make all cannabinoid retail tax payments by electronic means in the manner and form required by the Department.

Beginning October 1, 1993, a taxpayer who has an average monthly tax liability of $150,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1994, a taxpayer who has an average monthly tax liability of $100,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1995, a taxpayer who has an average monthly tax liability of $50,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 2000, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments required by rules of the Department by electronic funds transfer. The term "annual tax liability" shall be the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year. The term "average monthly tax liability" shall be the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year divided by 12. Beginning on October 1, 2002, a taxpayer who has a tax liability in the amount set forth in subsection (b) of Section 2505-210 of the Department of Revenue Law shall make all payments required by rules of the Department by electronic funds transfer.

Before August 1 of each year beginning in 1993, the Department shall notify all taxpayers required to make payments by electronic funds transfer. All taxpayers required to make payments by electronic funds transfer shall make those payments for a minimum of one year beginning on October 1.

Any taxpayer not required to make payments by electronic funds transfer may make payments by electronic funds transfer with the permission of the Department.

All taxpayers required to make payment by electronic funds transfer and any taxpayers authorized to voluntarily make payments by electronic funds transfer shall make those payments in the manner authorized by the Department.

The Department shall adopt such rules as are necessary to effectuate a program of electronic funds transfer and the requirements of this Section.

Any amount which is required to be shown or reported on any return or other document under this Act shall, if such amount is not a whole-dollar amount, be increased to the nearest whole-dollar amount in any case where the fractional part of a dollar is 50 cents or more, and decreased to the nearest whole-dollar amount where the fractional part of a dollar is less than 50 cents.

If the retailer is otherwise required to file a monthly return and if the retailer's average monthly tax liability to the Department does not exceed $200, the Department may authorize his returns to be filed on a quarter annual basis, with the return for January, February and March of a given year being due by April 20 of such year; with the return for April, May and June of a given year being due by July 20 of such year; with the return for July, August and September of a given year being due by October 20 of such year, and with the return for October, November and December of a given year being due by January 20 of the following year.

If the retailer is otherwise required to file a monthly or quarterly return and if the retailer's average monthly tax liability with the Department does not exceed $50, the Department may authorize his returns to be filed on an annual basis, with the return for a given year being due by January 20 of the following year.

Such quarter annual and annual returns, as to form and substance, shall be subject to the same requirements as monthly returns.

Notwithstanding any other provision in this Act concerning the time within which a retailer may file his return, in the case of any retailer who ceases to engage in a kind of business which makes him responsible for filing returns under this Act, such retailer shall file a final return under this Act with the Department not more than one month after discontinuing such business.

Where the same person has more than one business registered with the Department under separate registrations under this Act, such person may not file each return that is due as a single return covering all such registered businesses, but shall file separate returns for each such registered business.

In addition, with respect to motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, except as otherwise provided in this Section, every retailer selling this kind of tangible personal property shall file, with the Department, upon a form to be prescribed and supplied by the Department, a separate return for each such item of tangible personal property which the retailer sells, except that if, in the same transaction, (i) a retailer of aircraft, watercraft, motor vehicles or trailers transfers more than one aircraft, watercraft, motor vehicle or trailer to another aircraft, watercraft, motor vehicle retailer or trailer retailer for the purpose of resale or (ii) a retailer of aircraft, watercraft, motor vehicles, or trailers transfers more than one aircraft, watercraft, motor vehicle, or trailer to a purchaser for use as a qualifying rolling stock as provided in Section 2-5 of this Act, then that seller may report the transfer of all aircraft, watercraft, motor vehicles or trailers involved in that transaction to the Department on the same uniform invoice-transaction reporting return form. For purposes of this Section, "watercraft" means a Class 2, Class 3, or Class 4 watercraft as defined in Section 3-2 of the Boat Registration and Safety Act, a personal watercraft, or any boat equipped with an inboard motor.

In addition, with respect to motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, every person who is engaged in the business of leasing or renting such items and who, in connection with such business, sells any such item to a retailer for the purpose of resale is, notwithstanding any other provision of this Section to the contrary, authorized to meet the return-filing requirement of this Act by reporting the transfer of all the aircraft, watercraft, motor vehicles, or trailers transferred for resale during a month to the Department on the same uniform invoice-transaction reporting return form on or before the 20th of the month following the month in which the transfer takes place. Notwithstanding any other provision of this Act to the contrary, all returns filed under this paragraph must be filed by electronic means in the manner and form as required by the Department.

Any retailer who sells only motor vehicles, watercraft, aircraft, or trailers that are required to be registered with an agency of this State, so that all retailers' occupation tax liability is required to be reported, and is reported, on such transaction reporting returns and who is not otherwise required to file monthly or quarterly returns, need not file monthly or quarterly returns. However, those retailers shall be required to file returns on an annual basis.

The transaction reporting return, in the case of motor vehicles or trailers that are required to be registered with an agency of this State, shall be the same document as the Uniform Invoice referred to in Section 5-402 of the Illinois Vehicle Code and must show the name and address of the seller; the name and address of the purchaser; the amount of the selling price including the amount allowed by the retailer for traded-in property, if any; the amount allowed by the retailer for the traded-in tangible personal property, if any, to the extent to which Section 1 of this Act allows an exemption for the value of traded-in property; the balance payable after deducting such trade-in allowance from the total selling price; the amount of tax due from the retailer with respect to such transaction; the amount of tax collected from the purchaser by the retailer on such transaction (or satisfactory evidence that such tax is not due in that particular instance, if that is claimed to be the fact); the place and date of the sale; a sufficient identification of the property sold; such other information as is required in Section 5-402 of the Illinois Vehicle Code, and such other information as the Department may reasonably require.

The transaction reporting return in the case of watercraft or aircraft must show the name and address of the seller; the name and address of the purchaser; the amount of the selling price including the amount allowed by the retailer for traded-in property, if any; the amount allowed by the retailer for the traded-in tangible personal property, if any, to the extent to which Section 1 of this Act allows an exemption for the value of traded-in property; the balance payable after deducting such trade-in allowance from the total selling price; the amount of tax due from the retailer with respect to such transaction; the amount of tax collected from the purchaser by the retailer on such transaction (or satisfactory evidence that such tax is not due in that particular instance, if that is claimed to be the fact); the place and date of the sale, a sufficient identification of the property sold, and such other information as the Department may reasonably require.

Such transaction reporting return shall be filed not later than 20 days after the day of delivery of the item that is being sold, but may be filed by the retailer at any time sooner than that if he chooses to do so. The transaction reporting return and tax remittance or proof of exemption from the Illinois use tax may be transmitted to the Department by way of the State agency with which, or State officer with whom the tangible personal property must be titled or registered (if titling or registration is required) if the Department and such agency or State officer determine that this procedure will expedite the processing of applications for title or registration.

With each such transaction reporting return, the retailer shall remit the proper amount of tax due (or shall submit satisfactory evidence that the sale is not taxable if that is the case), to the Department or its agents, whereupon the Department shall issue, in the purchaser's name, a use tax receipt (or a certificate of exemption if the Department is satisfied that the particular sale is tax exempt) which such purchaser may submit to the agency with which, or State officer with whom, he must title or register the tangible personal property that is involved (if titling or registration is required) in support of such purchaser's application for an Illinois certificate or other evidence of title or registration to such tangible personal property.

No retailer's failure or refusal to remit tax under this Act precludes a user, who has paid the proper tax to the retailer, from obtaining his certificate of title or other evidence of title or registration (if titling or registration is required) upon satisfying the Department that such user has paid the proper tax (if tax is due) to the retailer. The Department shall adopt appropriate rules to carry out the mandate of this paragraph.

If the user who would otherwise pay tax to the retailer wants the transaction reporting return filed and the payment of the tax or proof of exemption made to the Department before the retailer is willing to take these actions and such user has not paid the tax to the retailer, such user may certify to the fact of such delay by the retailer and may (upon the Department being satisfied of the truth of such certification) transmit the information required by the transaction reporting return and the remittance for tax or proof of exemption directly to the Department and obtain his tax receipt or exemption determination, in which event the transaction reporting return and tax remittance (if a tax payment was required) shall be credited by the Department to the proper retailer's account with the Department, but without the 2.1% or 1.75% discount provided for in this Section being allowed. When the user pays the tax directly to the Department, he shall pay the tax in the same amount and in the same form in which it would be remitted if the tax had been remitted to the Department by the retailer.

Refunds made by the seller during the preceding return period to purchasers, on account of tangible personal property returned to the seller, shall be allowed as a deduction under subdivision 5 of his monthly or quarterly return, as the case may be, in case the seller had theretofore included the receipts from the sale of such tangible personal property in a return filed by him and had paid the tax imposed by this Act with respect to such receipts.

Where the seller is a corporation, the return filed on behalf of such corporation shall be signed by the president, vice-president, secretary or treasurer or by the properly accredited agent of such corporation.

Where the seller is a limited liability company, the return filed on behalf of the limited liability company shall be signed by a manager, member, or properly accredited agent of the limited liability company.

Except as provided in this Section, the retailer filing the return under this Section shall, at the time of filing such return, pay to the Department the amount of tax imposed by this Act less a discount of 2.1% prior to January 1, 1990 and 1.75% on and after January 1, 1990, or $5 per calendar year, whichever is greater, which is allowed to reimburse the retailer for the expenses incurred in keeping records, preparing and filing returns, remitting the tax and supplying data to the Department on request. On and after January 1, 2021, a certified service provider, as defined in the Leveling the Playing Field for Illinois Retail Act, filing the return under this Section on behalf of a remote retailer shall, at the time of such return, pay to the Department the amount of tax imposed by this Act less a discount of 1.75%. A remote retailer using a certified service provider to file a return on its behalf, as provided in the Leveling the Playing Field for Illinois Retail Act, is not eligible for the discount. When determining the discount allowed under this Section, retailers shall include the amount of tax that would have been due at the 1% rate but for the 0% rate imposed under Public Act 102-700 this amendatory Act of the 102nd General Assembly. When determining the discount allowed under this Section, retailers shall include the amount of tax that would have been due at the 6.25% rate but for the 1.25% rate imposed on sales tax holiday items under Public Act 102-700 this amendatory Act of the 102nd General Assembly. The discount under this Section is not allowed for the 1.25% portion of taxes paid on aviation fuel that is subject to the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133. Any prepayment made pursuant to Section 2d of this Act shall be included in the amount on which such 2.1% or 1.75% discount is computed. In the case of retailers who report and pay the tax on a transaction by transaction basis, as provided in this Section, such discount shall be taken with each such tax remittance instead of when such retailer files his periodic return. The discount allowed under this Section is allowed only for returns that are filed in the manner required by this Act. The Department may disallow the discount for retailers whose certificate of registration is revoked at the time the return is filed, but only if the Department's decision to revoke the certificate of registration has become final.

Before October 1, 2000, if the taxpayer's average monthly tax liability to the Department under this Act, the Use Tax Act, the Service Occupation Tax Act, and the Service Use Tax Act, excluding any liability for prepaid sales tax to be remitted in accordance with Section 2d of this Act, was $10,000 or more during the preceding 4 complete calendar quarters, he shall file a return with the Department each month by the 20th day of the month next following the month during which such tax liability is incurred and shall make payments to the Department on or before the 7th, 15th, 22nd and last day of the month during which such liability is incurred. On and after October 1, 2000, if the taxpayer's average monthly tax liability to the Department under this Act, the Use Tax Act, the Service Occupation Tax Act, and the Service Use Tax Act, excluding any liability for prepaid sales tax to be remitted in accordance with Section 2d of this Act, was $20,000 or more during the preceding 4 complete calendar quarters, he shall file a return with the Department each month by the 20th day of the month next following the month during which such tax liability is incurred and shall make payment to the Department on or before the 7th, 15th, 22nd and last day of the month during which such liability is incurred. If the month during which such tax liability is incurred began prior to January 1, 1985, each payment shall be in an amount equal to 1/4 of the taxpayer's actual liability for the month or an amount set by the Department not to exceed 1/4 of the average monthly liability of the taxpayer to the Department for the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability in such 4 quarter period). If the month during which such tax liability is incurred begins on or after January 1, 1985 and prior to January 1, 1987, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 27.5% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1987 and prior to January 1, 1988, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 26.25% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1988, and prior to January 1, 1989, or begins on or after January 1, 1996, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1989, and prior to January 1, 1996, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year or 100% of the taxpayer's actual liability for the quarter monthly reporting period. The amount of such quarter monthly payments shall be credited against the final tax liability of the taxpayer's return for that month. Before October 1, 2000, once applicable, the requirement of the making of quarter monthly payments to the Department by taxpayers having an average monthly tax liability of $10,000 or more as determined in the manner provided above shall continue until such taxpayer's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $9,000, or until such taxpayer's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarter period is less than $10,000. However, if a taxpayer can show the Department that a substantial change in the taxpayer's business has occurred which causes the taxpayer to anticipate that his average monthly tax liability for the reasonably foreseeable future will fall below the $10,000 threshold stated above, then such taxpayer may petition the Department for a change in such taxpayer's reporting status. On and after October 1, 2000, once applicable, the requirement of the making of quarter monthly payments to the Department by taxpayers having an average monthly tax liability of $20,000 or more as determined in the manner provided above shall continue until such taxpayer's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $19,000 or until such taxpayer's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarter period is less than $20,000. However, if a taxpayer can show the Department that a substantial change in the taxpayer's business has occurred which causes the taxpayer to anticipate that his average monthly tax liability for the reasonably foreseeable future will fall below the $20,000 threshold stated above, then such taxpayer may petition the Department for a change in such taxpayer's reporting status. The Department shall change such taxpayer's reporting status unless it finds that such change is seasonal in nature and not likely to be long term. Quarter monthly payment status shall be determined under this paragraph as if the rate reduction to 0% in Public Act 102-700 this amendatory Act of the 102nd General Assembly on food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, food consisting of or infused with adult use cannabis, soft drinks, and food that has been prepared for immediate consumption) had not occurred. For quarter monthly payments due under this paragraph on or after July 1, 2023 and through June 30, 2024, "25% of the taxpayer's liability for the same calendar month of the preceding year" shall be determined as if the rate reduction to 0% in Public Act 102-700 this amendatory Act of the 102nd General Assembly had not occurred. Quarter monthly payment status shall be determined under this paragraph as if the rate reduction to 1.25% in Public Act 102-700 this amendatory Act of the 102nd General Assembly on sales tax holiday items had not occurred. For quarter monthly payments due on or after July 1, 2023 and through June 30, 2024, "25% of the taxpayer's liability for the same calendar month of the preceding year" shall be determined as if the rate reduction to 1.25% in Public Act 102-700 this amendatory Act of the 102nd General Assembly on sales tax holiday items had not occurred. If any such quarter monthly payment is not paid at the time or in the amount required by this Section, then the taxpayer shall be liable for penalties and interest on the difference between the minimum amount due as a payment and the amount of such quarter monthly payment actually and timely paid, except insofar as the taxpayer has previously made payments for that month to the Department in excess of the minimum payments previously due as provided in this Section. The Department shall make reasonable rules and regulations to govern the quarter monthly payment amount and quarter monthly payment dates for taxpayers who file on other than a calendar monthly basis.

The provisions of this paragraph apply before October 1, 2001. Without regard to whether a taxpayer is required to make quarter monthly payments as specified above, any taxpayer who is required by Section 2d of this Act to collect and remit prepaid taxes and has collected prepaid taxes which average in excess of $25,000 per month during the preceding 2 complete calendar quarters, shall file a return with the Department as required by Section 2f and shall make payments to the Department on or before the 7th, 15th, 22nd and last day of the month during which such liability is incurred. If the month during which such tax liability is incurred began prior to September 1, 1985 (the effective date of Public Act 84-221), each payment shall be in an amount not less than 22.5% of the taxpayer's actual liability under Section 2d. If the month during which such tax liability is incurred begins on or after January 1, 1986, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 27.5% of the taxpayer's liability for the same calendar month of the preceding calendar year. If the month during which such tax liability is incurred begins on or after January 1, 1987, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 26.25% of the taxpayer's liability for the same calendar month of the preceding year. The amount of such quarter monthly payments shall be credited against the final tax liability of the taxpayer's return for that month filed under this Section or Section 2f, as the case may be. Once applicable, the requirement of the making of quarter monthly payments to the Department pursuant to this paragraph shall continue until such taxpayer's average monthly prepaid tax collections during the preceding 2 complete calendar quarters is $25,000 or less. If any such quarter monthly payment is not paid at the time or in the amount required, the taxpayer shall be liable for penalties and interest on such difference, except insofar as the taxpayer has previously made payments for that month in excess of the minimum payments previously due.

The provisions of this paragraph apply on and after October 1, 2001. Without regard to whether a taxpayer is required to make quarter monthly payments as specified above, any taxpayer who is required by Section 2d of this Act to collect and remit prepaid taxes and has collected prepaid taxes that average in excess of $20,000 per month during the preceding 4 complete calendar quarters shall file a return with the Department as required by Section 2f and shall make payments to the Department on or before the 7th, 15th, 22nd and last day of the month during which the liability is incurred. Each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year. The amount of the quarter monthly payments shall be credited against the final tax liability of the taxpayer's return for that month filed under this Section or Section 2f, as the case may be. Once applicable, the requirement of the making of quarter monthly payments to the Department pursuant to this paragraph shall continue until the taxpayer's average monthly prepaid tax collections during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $19,000 or until such taxpayer's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarters is less than $20,000. If any such quarter monthly payment is not paid at the time or in the amount required, the taxpayer shall be liable for penalties and interest on such difference, except insofar as the taxpayer has previously made payments for that month in excess of the minimum payments previously due.

If any payment provided for in this Section exceeds the taxpayer's liabilities under this Act, the Use Tax Act, the Service Occupation Tax Act and the Service Use Tax Act, as shown on an original monthly return, the Department shall, if requested by the taxpayer, issue to the taxpayer a credit memorandum no later than 30 days after the date of payment. The credit evidenced by such credit memorandum may be assigned by the taxpayer to a similar taxpayer under this Act, the Use Tax Act, the Service Occupation Tax Act or the Service Use Tax Act, in accordance with reasonable rules and regulations to be prescribed by the Department. If no such request is made, the taxpayer may credit such excess payment against tax liability subsequently to be remitted to the Department under this Act, the Use Tax Act, the Service Occupation Tax Act or the Service Use Tax Act, in accordance with reasonable rules and regulations prescribed by the Department. If the Department subsequently determined that all or any part of the credit taken was not actually due to the taxpayer, the taxpayer's 2.1% and 1.75% vendor's discount shall be reduced by 2.1% or 1.75% of the difference between the credit taken and that actually due, and that taxpayer shall be liable for penalties and interest on such difference.

If a retailer of motor fuel is entitled to a credit under Section 2d of this Act which exceeds the taxpayer's liability to the Department under this Act for the month for which the taxpayer is filing a return, the Department shall issue the taxpayer a credit memorandum for the excess.

Beginning January 1, 1990, each month the Department shall pay into the Local Government Tax Fund, a special fund in the State treasury which is hereby created, the net revenue realized for the preceding month from the 1% tax imposed under this Act.

Beginning January 1, 1990, each month the Department shall pay into the County and Mass Transit District Fund, a special fund in the State treasury which is hereby created, 4% of the net revenue realized for the preceding month from the 6.25% general rate other than aviation fuel sold on or after December 1, 2019. This exception for aviation fuel only applies for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

Beginning August 1, 2000, each month the Department shall pay into the County and Mass Transit District Fund 20% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol. If, in any month, the tax on sales tax holiday items, as defined in Section 2-8, is imposed at the rate of 1.25%, then the Department shall pay 20% of the net revenue realized for that month from the 1.25% rate on the selling price of sales tax holiday items into the County and Mass Transit District Fund.

Beginning January 1, 1990, each month the Department shall pay into the Local Government Tax Fund 16% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property other than aviation fuel sold on or after December 1, 2019. This exception for aviation fuel only applies for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

For aviation fuel sold on or after December 1, 2019, each month the Department shall pay into the State Aviation Program Fund 20% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of aviation fuel, less an amount estimated by the Department to be required for refunds of the 20% portion of the tax on aviation fuel under this Act, which amount shall be deposited into the Aviation Fuel Sales Tax Refund Fund. The Department shall only pay moneys into the State Aviation Program Fund and the Aviation Fuel Sales Tax Refund Fund under this Act for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

Beginning August 1, 2000, each month the Department shall pay into the Local Government Tax Fund 80% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol. If, in any month, the tax on sales tax holiday items, as defined in Section 2-8, is imposed at the rate of 1.25%, then the Department shall pay 80% of the net revenue realized for that month from the 1.25% rate on the selling price of sales tax holiday items into the Local Government Tax Fund.

Beginning October 1, 2009, each month the Department shall pay into the Capital Projects Fund an amount that is equal to an amount estimated by the Department to represent 80% of the net revenue realized for the preceding month from the sale of candy, grooming and hygiene products, and soft drinks that had been taxed at a rate of 1% prior to September 1, 2009 but that are now taxed at 6.25%.

Beginning July 1, 2011, each month the Department shall pay into the Clean Air Act Permit Fund 80% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of sorbents used in Illinois in the process of sorbent injection as used to comply with the Environmental Protection Act or the federal Clean Air Act, but the total payment into the Clean Air Act Permit Fund under this Act and the Use Tax Act shall not exceed $2,000,000 in any fiscal year.

Beginning July 1, 2013, each month the Department shall pay into the Underground Storage Tank Fund from the proceeds collected under this Act, the Use Tax Act, the Service Use Tax Act, and the Service Occupation Tax Act an amount equal to the average monthly deficit in the Underground Storage Tank Fund during the prior year, as certified annually by the Illinois Environmental Protection Agency, but the total payment into the Underground Storage Tank Fund under this Act, the Use Tax Act, the Service Use Tax Act, and the Service Occupation Tax Act shall not exceed $18,000,000 in any State fiscal year. As used in this paragraph, the "average monthly deficit" shall be equal to the difference between the average monthly claims for payment by the fund and the average monthly revenues deposited into the fund, excluding payments made pursuant to this paragraph.

Beginning July 1, 2015, of the remainder of the moneys received by the Department under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and this Act, each month the Department shall deposit $500,000 into the State Crime Laboratory Fund.

Of the remainder of the moneys received by the Department pursuant to this Act, (a) 1.75% thereof shall be paid into the Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on and after July 1, 1989, 3.8% thereof shall be paid into the Build Illinois Fund; provided, however, that if in any fiscal year the sum of (1) the aggregate of 2.2% or 3.8%, as the case may be, of the moneys received by the Department and required to be paid into the Build Illinois Fund pursuant to this Act, Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, and Section 9 of the Service Occupation Tax Act, such Acts being hereinafter called the "Tax Acts" and such aggregate of 2.2% or 3.8%, as the case may be, of moneys being hereinafter called the "Tax Act Amount", and (2) the amount transferred to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall be less than the Annual Specified Amount (as hereinafter defined), an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; the "Annual Specified Amount" means the amounts specified below for fiscal years 1986 through 1993: and means the Certified Annual Debt Service Requirement (as defined in Section 13 of the Build Illinois Bond Act) or the Tax Act Amount, whichever is greater, for fiscal year 1994 and each fiscal year thereafter; and further provided, that if on the last business day of any month the sum of (1) the Tax Act Amount required to be deposited into the Build Illinois Bond Account in the Build Illinois Fund during such month and (2) the amount transferred to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall have been less than 1/12 of the Annual Specified Amount, an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and, further provided, that in no event shall the payments required under the preceding proviso result in aggregate payments into the Build Illinois Fund pursuant to this clause (b) for any fiscal year in excess of the greater of (i) the Tax Act Amount or (ii) the Annual Specified Amount for such fiscal year. The amounts payable into the Build Illinois Fund under clause (b) of the first sentence in this paragraph shall be payable only until such time as the aggregate amount on deposit under each trust indenture securing Bonds issued and outstanding pursuant to the Build Illinois Bond Act is sufficient, taking into account any future investment income, to fully provide, in accordance with such indenture, for the defeasance of or the payment of the principal of, premium, if any, and interest on the Bonds secured by such indenture and on any Bonds expected to be issued thereafter and all fees and costs payable with respect thereto, all as certified by the Director of the Bureau of the Budget (now Governor's Office of Management and Budget). If on the last business day of any month in which Bonds are outstanding pursuant to the Build Illinois Bond Act, the aggregate of moneys deposited in the Build Illinois Bond Account in the Build Illinois Fund in such month shall be less than the amount required to be transferred in such month from the Build Illinois Bond Account to the Build Illinois Bond Retirement and Interest Fund pursuant to Section 13 of the Build Illinois Bond Act, an amount equal to such deficiency shall be immediately paid from other moneys received by the Department pursuant to the Tax Acts to the Build Illinois Fund; provided, however, that any amounts paid to the Build Illinois Fund in any fiscal year pursuant to this sentence shall be deemed to constitute payments pursuant to clause (b) of the first sentence of this paragraph and shall reduce the amount otherwise payable for such fiscal year pursuant to that clause (b). The moneys received by the Department pursuant to this Act and required to be deposited into the Build Illinois Fund are subject to the pledge, claim and charge set forth in Section 12 of the Build Illinois Bond Act.

Subject to payment of amounts into the Build Illinois Fund as provided in the preceding paragraph or in any amendment thereto hereafter enacted, the following specified monthly installment of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority provided under Section 8.25f of the State Finance Act, but not in excess of sums designated as "Total Deposit", shall be deposited in the aggregate from collections under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act into the McCormick Place Expansion Project Fund in the specified fiscal years.

Beginning July 20, 1993 and in each month of each fiscal year thereafter, one-eighth of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority for that fiscal year, less the amount deposited into the McCormick Place Expansion Project Fund by the State Treasurer in the respective month under subsection (g) of Section 13 of the Metropolitan Pier and Exposition Authority Act, plus cumulative deficiencies in the deposits required under this Section for previous months and years, shall be deposited into the McCormick Place Expansion Project Fund, until the full amount requested for the fiscal year, but not in excess of the amount specified above as "Total Deposit", has been deposited.

Subject to payment of amounts into the Capital Projects Fund, the Clean Air Act Permit Fund, the Build Illinois Fund, and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, for aviation fuel sold on or after December 1, 2019, the Department shall each month deposit into the Aviation Fuel Sales Tax Refund Fund an amount estimated by the Department to be required for refunds of the 80% portion of the tax on aviation fuel under this Act. The Department shall only deposit moneys into the Aviation Fuel Sales Tax Refund Fund under this paragraph for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning July 1, 1993 and ending on September 30, 2013, the Department shall each month pay into the Illinois Tax Increment Fund 0.27% of 80% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning with the receipt of the first report of taxes paid by an eligible business and continuing for a 25-year period, the Department shall each month pay into the Energy Infrastructure Fund 80% of the net revenue realized from the 6.25% general rate on the selling price of Illinois-mined coal that was sold to an eligible business. For purposes of this paragraph, the term "eligible business" means a new electric generating facility certified pursuant to Section 605-332 of the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois.

Subject to payment of amounts into the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, and the Energy Infrastructure Fund pursuant to the preceding paragraphs or in any amendments to this Section hereafter enacted, beginning on the first day of the first calendar month to occur on or after August 26, 2014 (the effective date of Public Act 98-1098), each month, from the collections made under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act, the Department shall pay into the Tax Compliance and Administration Fund, to be used, subject to appropriation, to fund additional auditors and compliance personnel at the Department of Revenue, an amount equal to 1/12 of 5% of 80% of the cash receipts collected during the preceding fiscal year by the Audit Bureau of the Department under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, the Retailers' Occupation Tax Act, and associated local occupation and use taxes administered by the Department.

Subject to payments of amounts into the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, beginning on July 1, 2018 the Department shall pay each month into the Downstate Public Transportation Fund the moneys required to be so paid under Section 2-3 of the Downstate Public Transportation Act.

Subject to successful execution and delivery of a public-private agreement between the public agency and private entity and completion of the civic build, beginning on July 1, 2023, of the remainder of the moneys received by the Department under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and this Act, the Department shall deposit the following specified deposits in the aggregate from collections under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act, as required under Section 8.25g of the State Finance Act for distribution consistent with the Public-Private Partnership for Civic and Transit Infrastructure Project Act. The moneys received by the Department pursuant to this Act and required to be deposited into the Civic and Transit Infrastructure Fund are subject to the pledge, claim and charge set forth in Section 25-55 of the Public-Private Partnership for Civic and Transit Infrastructure Project Act. As used in this paragraph, "civic build", "private entity", "public-private agreement", and "public agency" have the meanings provided in Section 25-10 of the Public-Private Partnership for Civic and Transit Infrastructure Project Act.

Fiscal Year.............................Total Deposit

2024.....................................$200,000,000

2025....................................$206,000,000

2026....................................$212,200,000

2027....................................$218,500,000

2028....................................$225,100,000

2029....................................$288,700,000

2030....................................$298,900,000

2031....................................$309,300,000

2032....................................$320,100,000

2033....................................$331,200,000

2034....................................$341,200,000

2035....................................$351,400,000

2036....................................$361,900,000

2037....................................$372,800,000

2038....................................$384,000,000

2039....................................$395,500,000

2040....................................$407,400,000

2041....................................$419,600,000

2042....................................$432,200,000

2043....................................$445,100,000

Beginning July 1, 2021 and until July 1, 2022, subject to the payment of amounts into the County and Mass Transit District Fund, the Local Government Tax Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 16% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2022 and until July 1, 2023, subject to the payment of amounts into the County and Mass Transit District Fund, the Local Government Tax Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 32% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2023 and until July 1, 2024, subject to the payment of amounts into the County and Mass Transit District Fund, the Local Government Tax Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 48% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning July 1, 2024 and until July 1, 2025, subject to the payment of amounts into the County and Mass Transit District Fund, the Local Government Tax Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 64% of the net revenue realized from the taxes imposed on motor fuel and gasohol. Beginning on July 1, 2025, subject to the payment of amounts into the County and Mass Transit District Fund, the Local Government Tax Fund, the Build Illinois Fund, the McCormick Place Expansion Project Fund, the Illinois Tax Increment Fund, the Energy Infrastructure Fund, and the Tax Compliance and Administration Fund as provided in this Section, the Department shall pay each month into the Road Fund the amount estimated to represent 80% of the net revenue realized from the taxes imposed on motor fuel and gasohol. As used in this paragraph "motor fuel" has the meaning given to that term in Section 1.1 of the Motor Fuel Tax Law, and "gasohol" has the meaning given to that term in Section 3-40 of the Use Tax Act.

Of the remainder of the moneys received by the Department pursuant to this Act, 75% thereof shall be paid into the State treasury Treasury and 25% shall be reserved in a special account and used only for the transfer to the Common School Fund as part of the monthly transfer from the General Revenue Fund in accordance with Section 8a of the State Finance Act.

The Department may, upon separate written notice to a taxpayer, require the taxpayer to prepare and file with the Department on a form prescribed by the Department within not less than 60 days after receipt of the notice an annual information return for the tax year specified in the notice. Such annual return to the Department shall include a statement of gross receipts as shown by the retailer's last Federal income tax return. If the total receipts of the business as reported in the Federal income tax return do not agree with the gross receipts reported to the Department of Revenue for the same period, the retailer shall attach to his annual return a schedule showing a reconciliation of the 2 amounts and the reasons for the difference. The retailer's annual return to the Department shall also disclose the cost of goods sold by the retailer during the year covered by such return, opening and closing inventories of such goods for such year, costs of goods used from stock or taken from stock and given away by the retailer during such year, payroll information of the retailer's business during such year and any additional reasonable information which the Department deems would be helpful in determining the accuracy of the monthly, quarterly or annual returns filed by such retailer as provided for in this Section.

If the annual information return required by this Section is not filed when and as required, the taxpayer shall be liable as follows:

(i) Until January 1, 1994, the taxpayer shall be liable for a penalty equal to 1/6 of 1% of the tax due from such taxpayer under this Act during the period to be covered by the annual return for each month or fraction of a month until such return is filed as required, the penalty to be assessed and collected in the same manner as any other penalty provided for in this Act.

(ii) On and after January 1, 1994, the taxpayer shall be liable for a penalty as described in Section 3-4 of the Uniform Penalty and Interest Act.

The chief executive officer, proprietor, owner or highest ranking manager shall sign the annual return to certify the accuracy of the information contained therein. Any person who willfully signs the annual return containing false or inaccurate information shall be guilty of perjury and punished accordingly. The annual return form prescribed by the Department shall include a warning that the person signing the return may be liable for perjury.

The provisions of this Section concerning the filing of an annual information return do not apply to a retailer who is not required to file an income tax return with the United States Government.

As soon as possible after the first day of each month, upon certification of the Department of Revenue, the Comptroller shall order transferred and the Treasurer shall transfer from the General Revenue Fund to the Motor Fuel Tax Fund an amount equal to 1.7% of 80% of the net revenue realized under this Act for the second preceding month. Beginning April 1, 2000, this transfer is no longer required and shall not be made.

Net revenue realized for a month shall be the revenue collected by the State pursuant to this Act, less the amount paid out during that month as refunds to taxpayers for overpayment of liability.

For greater simplicity of administration, manufacturers, importers and wholesalers whose products are sold at retail in Illinois by numerous retailers, and who wish to do so, may assume the responsibility for accounting and paying to the Department all tax accruing under this Act with respect to such sales, if the retailers who are affected do not make written objection to the Department to this arrangement.

Any person who promotes, organizes, provides retail selling space for concessionaires or other types of sellers at the Illinois State Fair, DuQuoin State Fair, county fairs, local fairs, art shows, flea markets and similar exhibitions or events, including any transient merchant as defined by Section 2 of the Transient Merchant Act of 1987, is required to file a report with the Department providing the name of the merchant's business, the name of the person or persons engaged in merchant's business, the permanent address and Illinois Retailers Occupation Tax Registration Number of the merchant, the dates and location of the event and other reasonable information that the Department may require. The report must be filed not later than the 20th day of the month next following the month during which the event with retail sales was held. Any person who fails to file a report required by this Section commits a business offense and is subject to a fine not to exceed $250.

Any person engaged in the business of selling tangible personal property at retail as a concessionaire or other type of seller at the Illinois State Fair, county fairs, art shows, flea markets and similar exhibitions or events, or any transient merchants, as defined by Section 2 of the Transient Merchant Act of 1987, may be required to make a daily report of the amount of such sales to the Department and to make a daily payment of the full amount of tax due. The Department shall impose this requirement when it finds that there is a significant risk of loss of revenue to the State at such an exhibition or event. Such a finding shall be based on evidence that a substantial number of concessionaires or other sellers who are not residents of Illinois will be engaging in the business of selling tangible personal property at retail at the exhibition or event, or other evidence of a significant risk of loss of revenue to the State. The Department shall notify concessionaires and other sellers affected by the imposition of this requirement. In the absence of notification by the Department, the concessionaires and other sellers shall file their returns as otherwise required in this Section.

(Source: P.A. 101-10, Article 15, Section 15-25, eff. 6-5-19; 101-10, Article 25, Section 25-120, eff. 6-5-19; 101-27, eff. 6-25-19; 101-32, eff. 6-28-19; 101-604, eff. 12-13-19; 101-636, eff. 6-10-20; 102-634, eff. 8-27-21; 102-700, Article 60, Section 60-30, eff. 4-19-22; 102-700, Article 65, Section 65-10, eff. 4-19-22; 102-813, eff. 5-13-22; 102-1019, eff. 1-1-23; revised 12-13-22.)

Section 25. The Cannabis Regulation and Tax Act is amended by changing Sections 1-10 and 10-10 as follows:

(410 ILCS 705/1-10)

Sec. 1-10. Definitions. In this Act:

"Adult Use Cultivation Center License" means a license issued by the Department of Agriculture that permits a person to act as a cultivation center under this Act and any administrative rule made in furtherance of this Act.

"Adult Use Dispensing Organization License" means a license issued by the Department of Financial and Professional Regulation that permits a person to act as a dispensing organization under this Act and any administrative rule made in furtherance of this Act.

"Advertise" means to engage in promotional activities including, but not limited to: newspaper, radio, Internet and electronic media, and television advertising; the distribution of fliers and circulars; billboard advertising; and the display of window and interior signs. "Advertise" does not mean exterior signage displaying only the name of the licensed cannabis business establishment.

"Application points" means the number of points a Dispensary Applicant receives on an application for a Conditional Adult Use Dispensing Organization License.

"BLS Region" means a region in Illinois used by the United States Bureau of Labor Statistics to gather and categorize certain employment and wage data. The 17 such regions in Illinois are: Bloomington, Cape Girardeau, Carbondale-Marion, Champaign-Urbana, Chicago-Naperville-Elgin, Danville, Davenport-Moline-Rock Island, Decatur, Kankakee, Peoria, Rockford, St. Louis, Springfield, Northwest Illinois nonmetropolitan area, West Central Illinois nonmetropolitan area, East Central Illinois nonmetropolitan area, and South Illinois nonmetropolitan area.

"By lot" means a randomized method of choosing between 2 or more Eligible Tied Applicants or 2 or more Qualifying Applicants.

"Cannabis" means marijuana, hashish, and other substances that are identified as including any parts of the plant Cannabis sativa and including derivatives or subspecies, such as indica, of all strains of cannabis, whether growing or not; the seeds thereof, the resin extracted from any part of the plant; and any compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds, or resin, including tetrahydrocannabinol (THC) and all other naturally produced cannabinol derivatives, whether produced directly or indirectly by extraction; however, "cannabis" does not include the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or preparation of the mature stalks (except the resin extracted from it), fiber, oil or cake, or the sterilized seed of the plant that is incapable of germination. "Cannabis" does not include industrial hemp as defined and authorized under the Industrial Hemp Act. "Cannabis" also means cannabis flower, concentrate, and cannabis-infused products.

"Cannabis business establishment" means a cultivation center, craft grower, processing organization, infuser organization, dispensing organization, or transporting organization.

"Cannabis concentrate" means a product derived from cannabis that is produced by extracting cannabinoids, including tetrahydrocannabinol (THC), from the plant through the use of propylene glycol, glycerin, butter, olive oil, or other typical cooking fats; water, ice, or dry ice; or butane, propane, CO₂, ethanol, or isopropanol and with the intended use of smoking or making a cannabis-infused product. The use of any other solvent is expressly prohibited unless and until it is approved by the Department of Agriculture.

"Cannabis container" means a sealed or resealable, traceable, container, or package used for the purpose of containment of cannabis or cannabis-infused product during transportation.

"Cannabis flower" means marijuana, hashish, and other substances that are identified as including any parts of the plant Cannabis sativa and including derivatives or subspecies, such as indica, of all strains of cannabis; including raw kief, leaves, and buds, but not resin that has been extracted from any part of such plant; nor any compound, manufacture, salt, derivative, mixture, or preparation of such plant, its seeds, or resin.

"Cannabis-infused product" means a beverage, food, oil, ointment, tincture, topical formulation, or another product containing cannabis or cannabis concentrate that is not intended to be smoked.

"Cannabis paraphernalia" means equipment, products, or materials intended to be used for planting, propagating, cultivating, growing, harvesting, manufacturing, producing, processing, preparing, testing, analyzing, packaging, repackaging, storing, containing, concealing, ingesting, or otherwise introducing cannabis into the human body.

"Cannabis plant monitoring system" or "plant monitoring system" means a system that includes, but is not limited to, testing and data collection established and maintained by the cultivation center, craft grower, or processing organization and that is available to the Department of Revenue, the Department of Agriculture, the Department of Financial and Professional Regulation, and the Illinois State Police for the purposes of documenting each cannabis plant and monitoring plant development throughout the life cycle of a cannabis plant cultivated for the intended use by a customer from seed planting to final packaging.

"Cannabis testing facility" means an entity registered by the Department of Agriculture to test cannabis for potency and contaminants.

"Clone" means a plant section from a female cannabis plant not yet rootbound, growing in a water solution or other propagation matrix, that is capable of developing into a new plant.

"Community College Cannabis Vocational Training Pilot Program faculty participant" means a person who is 21 years of age or older, licensed by the Department of Agriculture, and is employed or contracted by an Illinois community college to provide student instruction using cannabis plants at an Illinois Community College.

"Community College Cannabis Vocational Training Pilot Program faculty participant Agent Identification Card" means a document issued by the Department of Agriculture that identifies a person as a Community College Cannabis Vocational Training Pilot Program faculty participant.

"Conditional Adult Use Dispensing Organization License" means a contingent license awarded to applicants for an Adult Use Dispensing Organization License that reserves the right to an Adult Use Dispensing Organization License if the applicant meets certain conditions described in this Act, but does not entitle the recipient to begin purchasing or selling cannabis or cannabis-infused products.

"Conditional Adult Use Cultivation Center License" means a license awarded to top-scoring applicants for an Adult Use Cultivation Center License that reserves the right to an Adult Use Cultivation Center License if the applicant meets certain conditions as determined by the Department of Agriculture by rule, but does not entitle the recipient to begin growing, processing, or selling cannabis or cannabis-infused products.

"Craft grower" means a facility operated by an organization or business that is licensed by the Department of Agriculture to cultivate, dry, cure, and package cannabis and perform other necessary activities to make cannabis available for sale at a dispensing organization or use at a processing organization. A craft grower may contain up to 5,000 square feet of canopy space on its premises for plants in the flowering state. The Department of Agriculture may authorize an increase or decrease of flowering stage cultivation space in increments of 3,000 square feet by rule based on market need, craft grower capacity, and the licensee's history of compliance or noncompliance, with a maximum space of 14,000 square feet for cultivating plants in the flowering stage, which must be cultivated in all stages of growth in an enclosed and secure area. A craft grower may share premises with a processing organization or a dispensing organization, or both, provided each licensee stores currency and cannabis or cannabis-infused products in a separate secured vault to which the other licensee does not have access or all licensees sharing a vault share more than 50% of the same ownership.

"Craft grower agent" means a principal officer, board member, employee, or other agent of a craft grower who is 21 years of age or older.

"Craft Grower Agent Identification Card" means a document issued by the Department of Agriculture that identifies a person as a craft grower agent.

"Cultivation center" means a facility operated by an organization or business that is licensed by the Department of Agriculture to cultivate, process, transport (unless otherwise limited by this Act), and perform other necessary activities to provide cannabis and cannabis-infused products to cannabis business establishments.

"Cultivation center agent" means a principal officer, board member, employee, or other agent of a cultivation center who is 21 years of age or older.

"Cultivation Center Agent Identification Card" means a document issued by the Department of Agriculture that identifies a person as a cultivation center agent.

"Currency" means currency and coin of the United States.

"Dispensary" means a facility operated by a dispensing organization at which activities licensed by this Act may occur.

"Dispensary Applicant" means the Proposed Dispensing Organization Name as stated on an application for a Conditional Adult Use Dispensing Organization License.

"Dispensing organization" means a facility operated by an organization or business that is licensed by the Department of Financial and Professional Regulation to acquire cannabis from a cultivation center, craft grower, processing organization, or another dispensary for the purpose of selling or dispensing cannabis, cannabis-infused products, cannabis seeds, paraphernalia, or related supplies under this Act to purchasers or to qualified registered medical cannabis patients and caregivers. As used in this Act, "dispensing organization" includes a registered medical cannabis organization as defined in the Compassionate Use of Medical Cannabis Program Act or its successor Act that has obtained an Early Approval Adult Use Dispensing Organization License.

"Dispensing organization agent" means a principal officer, employee, or agent of a dispensing organization who is 21 years of age or older.

"Dispensing organization agent identification card" means a document issued by the Department of Financial and Professional Regulation that identifies a person as a dispensing organization agent.

"Disproportionately Impacted Area" means a census tract or comparable geographic area that satisfies the following criteria as determined by the Department of Commerce and Economic Opportunity, that:

(1) meets at least one of the following criteria:

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

(B) 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

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

(D) the area has an average unemployment rate, as determined by the Illinois 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; and

(2) has high rates of arrest, conviction, and incarceration related to the sale, possession, use, cultivation, manufacture, or transport of cannabis.

"Early Approval Adult Use Cultivation Center License" means a license that permits a medical cannabis cultivation center licensed under the Compassionate Use of Medical Cannabis Program Act as of the effective date of this Act to begin cultivating, infusing, packaging, transporting (unless otherwise provided in this Act), processing, and selling cannabis or cannabis-infused product to cannabis business establishments for resale to purchasers as permitted by this Act as of January 1, 2020.

"Early Approval Adult Use Dispensing Organization License" means a license that permits a medical cannabis dispensing organization licensed under the Compassionate Use of Medical Cannabis Program Act as of the effective date of this Act to begin selling cannabis or cannabis-infused product to purchasers as permitted by this Act as of January 1, 2020.

"Early Approval Adult Use Dispensing Organization at a secondary site" means a license that permits a medical cannabis dispensing organization licensed under the Compassionate Use of Medical Cannabis Program Act as of the effective date of this Act to begin selling cannabis or cannabis-infused product to purchasers as permitted by this Act on January 1, 2020 at a different dispensary location from its existing registered medical dispensary location.

"Eligible Tied Applicant" means a Tied Applicant that is eligible to participate in the process by which a remaining available license is distributed by lot pursuant to a Tied Applicant Lottery.

"Enclosed, locked facility" means a room, greenhouse, building, or other enclosed area equipped with locks or other security devices that permit access only by cannabis business establishment agents working for the licensed cannabis business establishment or acting pursuant to this Act to cultivate, process, store, or distribute cannabis.

"Enclosed, locked space" means a closet, room, greenhouse, building, or other enclosed area equipped with locks or other security devices that permit access only by authorized individuals under this Act. "Enclosed, locked space" may include:

(1) a space within a residential building that (i) is the primary residence of the individual cultivating 5 or fewer cannabis plants that are more than 5 inches tall and (ii) includes sleeping quarters and indoor plumbing. The space must only be accessible by a key or code that is different from any key or code that can be used to access the residential building from the exterior; or

(2) a structure, such as a shed or greenhouse, that lies on the same plot of land as a residential building that (i) includes sleeping quarters and indoor plumbing and (ii) is used as a primary residence by the person cultivating 5 or fewer cannabis plants that are more than 5 inches tall, such as a shed or greenhouse. The structure must remain locked when it is unoccupied by people.

"Financial institution" has the same meaning as "financial organization" as defined in Section 1501 of the Illinois Income Tax Act, and also includes the holding companies, subsidiaries, and affiliates of such financial organizations.

"Flowering stage" means the stage of cultivation where and when a cannabis plant is cultivated to produce plant material for cannabis products. This includes mature plants as follows:

(1) if greater than 2 stigmas are visible at each internode of the plant; or

(2) if the cannabis plant is in an area that has been intentionally deprived of light for a period of time intended to produce flower buds and induce maturation, from the moment the light deprivation began through the remainder of the marijuana plant growth cycle.

"Individual" means a natural person.

"Infuser organization" or "infuser" means a facility operated by an organization or business that is licensed by the Department of Agriculture to directly incorporate cannabis or cannabis concentrate into a product formulation to produce a cannabis-infused product.

"Kief" means the resinous crystal-like trichomes that are found on cannabis and that are accumulated, resulting in a higher concentration of cannabinoids, untreated by heat or pressure, or extracted using a solvent.

"Labor peace agreement" means an agreement between a cannabis business establishment and any labor organization recognized under the National Labor Relations Act, referred to in this Act as a bona fide labor organization, that prohibits labor organizations and members from engaging in picketing, work stoppages, boycotts, and any other economic interference with the cannabis business establishment. This agreement means that the cannabis business establishment has agreed not to disrupt efforts by the bona fide labor organization to communicate with, and attempt to organize and represent, the cannabis business establishment's employees. The agreement shall provide a bona fide labor organization access at reasonable times to areas in which the cannabis business establishment's employees work, for the purpose of meeting with employees to discuss their right to representation, employment rights under State law, and terms and conditions of employment. This type of agreement shall not mandate a particular method of election or certification of the bona fide labor organization.

"Limited access area" means a room or other area under the control of a cannabis dispensing organization licensed under this Act and upon the licensed premises where cannabis sales occur with access limited to purchasers, dispensing organization owners and other dispensing organization agents, or service professionals conducting business with the dispensing organization, or, if sales to registered qualifying patients, caregivers, provisional patients, and Opioid Alternative Pilot Program participants licensed pursuant to the Compassionate Use of Medical Cannabis Program Act are also permitted at the dispensary, registered qualifying patients, caregivers, provisional patients, and Opioid Alternative Pilot Program participants.

"Member of an impacted family" means an individual who has a parent, legal guardian, child, spouse, or dependent, or was a dependent of an individual who, prior to the effective date of this Act, was arrested for, convicted of, or adjudicated delinquent for any offense that is eligible for expungement under this Act.

"Mother plant" means a cannabis plant that is cultivated or maintained for the purpose of generating clones, and that will not be used to produce plant material for sale to an infuser or dispensing organization.

"Ordinary public view" means within the sight line with normal visual range of a person, unassisted by visual aids, from a public street or sidewalk adjacent to real property, or from within an adjacent property.

"Ownership and control" means ownership of at least 51% of the business, including corporate stock if a corporation, and control over the management and day-to-day operations of the business and an interest in the capital, assets, and profits and losses of the business proportionate to percentage of ownership.

"Person" means a natural individual, firm, partnership, association, joint stock company, joint venture, public or private corporation, limited liability company, or a receiver, executor, trustee, guardian, or other representative appointed by order of any court.

"Possession limit" means the amount of cannabis under Section 10-10 that may be possessed at any one time by a person 21 years of age or older or who is a registered qualifying medical cannabis patient or caregiver under the Compassionate Use of Medical Cannabis Program Act.

"Principal officer" includes a cannabis business establishment applicant or licensed cannabis business establishment's board member, owner with more than 1% interest of the total cannabis business establishment or more than 5% interest of the total cannabis business establishment of a publicly traded company, president, vice president, secretary, treasurer, partner, officer, member, manager member, or person with a profit sharing, financial interest, or revenue sharing arrangement. The definition includes a person with authority to control the cannabis business establishment, a person who assumes responsibility for the debts of the cannabis business establishment and who is further defined in this Act.

"Primary residence" means a dwelling where a person usually stays or stays more often than other locations. It may be determined by, without limitation, presence, tax filings; address on an Illinois driver's license, an Illinois Identification Card, or an Illinois Person with a Disability Identification Card; or voter registration. No person may have more than one primary residence.

"Processing organization" or "processor" means a facility operated by an organization or business that is licensed by the Department of Agriculture to either extract constituent chemicals or compounds to produce cannabis concentrate or incorporate cannabis or cannabis concentrate into a product formulation to produce a cannabis product.

"Processing organization agent" means a principal officer, board member, employee, or agent of a processing organization.

"Processing organization agent identification card" means a document issued by the Department of Agriculture that identifies a person as a processing organization agent.

"Purchaser" means a person 21 years of age or older who acquires cannabis for a valuable consideration. "Purchaser" does not include a cardholder under the Compassionate Use of Medical Cannabis Program Act.

"Qualifying Applicant" means an applicant that submitted an application pursuant to Section 15-30 that received at least 85% of 250 application points available under Section 15-30 as the applicant's final score and meets the definition of "Social Equity Applicant" as set forth under this Section.

"Qualifying Social Equity Justice Involved Applicant" means an applicant that submitted an application pursuant to Section 15-30 that received at least 85% of 250 application points available under Section 15-30 as the applicant's final score and meets the criteria of either paragraph (1) or (2) of the definition of "Social Equity Applicant" as set forth under this Section.

"Qualified Social Equity Applicant" means a Social Equity Applicant who has been awarded a conditional license under this Act to operate a cannabis business establishment.

"Resided" means an individual's primary residence was located within the relevant geographic area as established by 2 of the following:

(1) a signed lease agreement that includes the applicant's name;

(2) a property deed that includes the applicant's name;

(3) school records;

(4) a voter registration card;

(5) an Illinois driver's license, an Illinois Identification Card, or an Illinois Person with a Disability Identification Card;

(6) a paycheck stub;

(7) a utility bill;

(8) tax records; or

(9) any other proof of residency or other information necessary to establish residence as provided by rule.

"Smoking" means the inhalation of smoke caused by the combustion of cannabis.

"Social Equity Applicant" means an applicant that is an Illinois resident that meets one of the following criteria:

(1) an applicant with at least 51% ownership and control by one or more individuals who have resided for at least 5 of the preceding 10 years in a Disproportionately Impacted Area;

(2) an applicant with at least 51% ownership and control by one or more individuals who:

(i) have been arrested for, convicted of, or adjudicated delinquent for any offense that is eligible for expungement under this Act; or

(ii) is a member of an impacted family;

(3) for applicants with a minimum of 10 full-time employees, an applicant with at least 51% of current employees who:

(i) currently reside in a Disproportionately Impacted Area; or

(ii) have been arrested for, convicted of, or adjudicated delinquent for any offense that is eligible for expungement under this Act or member of an impacted family.

Nothing in this Act shall be construed to preempt or limit the duties of any employer under the Job Opportunities for Qualified Applicants Act. Nothing in this Act shall permit an employer to require an employee to disclose sealed or expunged offenses, unless otherwise required by law.

"Tied Applicant" means an application submitted by a Dispensary Applicant pursuant to Section 15-30 that received the same number of application points under Section 15-30 as the Dispensary Applicant's final score as one or more top-scoring applications in the same BLS Region and would have been awarded a license but for the one or more other top-scoring applications that received the same number of application points. Each application for which a Dispensary Applicant was required to pay a required application fee for the application period ending January 2, 2020 shall be considered an application of a separate Tied Applicant.

"Tied Applicant Lottery" means the process established under 68 Ill. Adm. Code 1291.50 for awarding Conditional Adult Use Dispensing Organization Licenses pursuant to Sections 15-25 and 15-30 among Eligible Tied Applicants.

"Tincture" means a cannabis-infused solution, typically comprised of alcohol, glycerin, or vegetable oils, derived either directly from the cannabis plant or from a processed cannabis extract. A tincture is not an alcoholic liquor as defined in the Liquor Control Act of 1934. A tincture shall include a calibrated dropper or other similar device capable of accurately measuring servings.

"Transporting organization" or "transporter" means an organization or business that is licensed by the Department of Agriculture to transport cannabis or cannabis-infused product on behalf of a cannabis business establishment or a community college licensed under the Community College Cannabis Vocational Training Pilot Program.

"Transporting organization agent" means a principal officer, board member, employee, or agent of a transporting organization.

"Transporting organization agent identification card" means a document issued by the Department of Agriculture that identifies a person as a transporting organization agent.

"Unit of local government" means any county, city, village, or incorporated town.

"Vegetative stage" means the stage of cultivation in which a cannabis plant is propagated to produce additional cannabis plants or reach a sufficient size for production. This includes seedlings, clones, mothers, and other immature cannabis plants as follows:

(1) if the cannabis plant is in an area that has not been intentionally deprived of light for a period of time intended to produce flower buds and induce maturation, it has no more than 2 stigmas visible at each internode of the cannabis plant; or

(2) any cannabis plant that is cultivated solely for the purpose of propagating clones and is never used to produce cannabis.

(Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19; 102-98, eff. 7-15-21; 102-538, eff. 8-20-21; 102-813, eff. 5-13-22.)

(410 ILCS 705/10-10)

Sec. 10-10. Possession limit.

(a) Except if otherwise authorized by this Act, for a person who is 21 years of age or older and a resident of this State, the possession limit is as follows:

(1) 30 grams of cannabis flower;

(2) no more than 500 milligrams of THC contained in cannabis-infused product;

(3) 5 grams of cannabis concentrate; and

(4) for registered qualifying patients, any cannabis produced by cannabis plants grown under subsection (b) of Section 10-5, provided any amount of cannabis produced in excess of 30 grams of raw cannabis or its equivalent must remain secured within the residence or residential property in which it was grown.

(b) For a person who is 21 years of age or older and who is not a resident of this State, the possession limit is:

(1) 15 grams of cannabis flower;

(2) 2.5 grams of cannabis concentrate; and

(3) 250 milligrams of THC contained in a cannabis-infused product.

(c) The possession limits found in subsections (a) and (b) of this Section are to be considered cumulative.

(d) No person shall knowingly obtain, seek to obtain, or possess an amount of cannabis from a dispensing organization or craft grower that would cause him or her to exceed the possession limit under this Section, including cannabis that is cultivated by a person under this Act or obtained under the Compassionate Use of Medical Cannabis Program Act.

(e) Cannabis and cannabis-derived substances regulated under the Industrial Hemp Act are not covered by this Act.

(Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19.)

Section 30. The Industrial Hemp Act is amended by changing Sections 1, 5, 15, 17, 18, and 20 and by adding Sections 3, 6, 7, 10.5, 10.10, 10.15, 10.20, 10.25, 10.30, 10.35, 10.40, 10.45, 10.50, 10.55, 10.60, 10.65, 10.70, 10.75, 10.80, 10.85, 10.90, 10.95, 10.100, 11, 11.5, 11.10, 11.15, 11.20, 12, 13, 15.5, 16, 17.5, 18.5, 28, 30, and 800 as follows:

(505 ILCS 89/1)

Sec. 1. Short title. This Act may be cited as the Industrial Hemp Act.

(Source: P.A. 100-1091, eff. 8-26-18.)

(505 ILCS 89/3 new)

Sec. 3. Findings. The General Assembly finds that:

(1) In the interest of allowing law enforcement to focus on violent and property crimes, generating revenue for education, substance abuse prevention and treatment, freeing public resources to invest in communities and other public purposes, and individual freedom, the use of hemp-derived cannabinoids should be legal for persons 21 years of age or older and should be taxed in a manner similar to beer, wine, spirits, and cannabis.

(2) In the interest of the health and public safety of the residents of Illinois, hemp-derived cannabinoids should be regulated in a manner similar to beer, wine, spirits, and cannabis so that:

(A) persons will have to show proof of age before purchasing hemp-derived cannabinoids;

(B) selling, distributing, or transferring hemp-derived cannabinoids to minors and other persons under 21 years of age shall be illegal;

(C) driving under the influence of hemp-derived cannabinoids, operating a watercraft under the influence of hemp-derived cannabinoids and operating a snowmobile under the influence of hemp-derived cannabinoids shall be illegal;

(D) legitimate, taxpaying business people, and not criminal actors, will conduct the sales of hemp-derived cannabinoids;

(E) hemp-derived cannabinoids sold in the State will be tested, labeled, and subject to additional regulation to ensure that purchasers are informed and protected; and

(F) purchasers shall be informed of any known health risks associated with the use of hemp-derived cannabinoids, as concluded by evidence-based, peer reviewed research.

(3) It is necessary to ensure consistency and fairness in the application of this Act throughout the State and, therefore, the matters by this Act are, except as specified in this Act, matters of statewide concern.

(4) This Act shall not diminish the State's duties and commitment to purchasers and businesses that operate under the Cannabis Regulation and Tax Act or alter the protections granted to them.

(5) This Act shall not diminish the State's duties and commitment to seriously ill patients registered under the Compassionate Use of Medical Cannabis Program Act, nor alter the protections granted to them.

(6) Supporting and encouraging labor neutrality in the hemp-derived cannabinoid industry and employee workplace safety is desirable, and employer workplace policies shall be interpreted broadly to protect employee safety.

(505 ILCS 89/5)

Sec. 5. Definitions. In this Act:

"Batch" means a specific quantity of a specific cannabinoid product that is manufactured at the same time and using the same methods, equipment, and ingredients, that is uniform and intended to meet specifications for identity, strength, purity, and composition, and that is manufactured, packaged, and labeled according to a single batch production record executed and documented during the same cycle of manufacture and produced by a continuous process.

"Batch cycle" means a specific quantity of a specific cannabinoid product that is manufactured using the same methods, equipment, and ingredients, that is uniform and intended to meet specifications for identity, strength, purity, and composition, and that is manufactured, packaged, and labeled according to a batch cycle production record executed and documented during the same cycle of manufacture.

"Cannabinoid menu item" means a restaurant-type food that incorporates ready-to-eat cannabinoids included on a menu or menu board or offered as a self-service food or food on display.

"Cannabinoid retail tax" means a tax of 5% that is assessed on the final retail sale of all products that contain cannabinoids.

"Cottage hemp cannabinoid product" means a type of hemp cannabinoid product available for human consumption, including time/temperature control for safety food as that term is defined in Section 1-201.10 of the 2017 Food Code of the United States Public Health Service of the Food and Drug Administration, that utilize intermediate hemp products as an input and is produced by a cottage hemp food operator and contains THC levels below 0.3% by weight.

"Cottage hemp food operator" means an individual who produces food or drink, other than foods and drinks listed as prohibited by Section 4 of the Food Handling Regulation Enforcement Act, that incorporate intermediate hemp products in a kitchen located in that person's primary domestic residence or another appropriately designed and equipped kitchen on a farm for direct sale by the individual, a family member, or employee.

"Department" means the Department of Agriculture.

"Director" means the Director of Agriculture.

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

(1) 20% or more of the households in the area have incomes at or below 185% of the poverty guidelines updated periodically in the Federal Register by the U.S. Department of Health and Human Services under the authority of 42 U.S.C. 9902(2);

(2) 75% or more of the children in the area participate in the National School Lunch Program according to reported statistics from the State Board of Education;

(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 Illinois Department of Employment Security, that is more than 120% of the national employment 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 and has high rates or arrest, conviction, and incarceration related to the sale, possession, use, cultivation, manufacture, or transport of cannabis as defined under the Cannabis Regulation and Tax Act.

"Full-panel test" means a test that includes potency testing and tests for contaminants, such as pesticides, heavy metals, mold, and residual solvents.

"Hemp" or "industrial hemp" means the plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a total THC delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry-weight basis. "Hemp" includes industrial hemp, hemp cannabinoid products, and ready-to-eat hemp products dry weight basis and includes any intermediate or finished product made or derived from industrial hemp.

"Hemp business establishment" means a hemp farm, hemp processor, hemp distributor, hemp retailer, hemp food establishment, or cottage hemp food operator.

"Hemp cannabinoid" means the chemical constituents of hemp plants that are naturally occurring and biologically active.

"Hemp cannabinoid product" means a finished product for sale to hemp cannabinoid users or medical patients at hemp business establishments within the State of Illinois that contains cannabinoids derived from hemp, is intended for human consumption by inhalation and ingestion, does not exceed 50 milligrams of THC per serving, and meets the packaging, labeling, and testing requirements of this Act.

"Hemp cannabinoid user" means a member of the general public who buys or uses hemp and who is protected by laws against unfair or fraudulent practices in the marketplace.

"Hemp distributor" means a facility operated by an organization or business that is licensed by the Department of Financial and Professional Regulation to import hemp cannabinoid products from out-of-state and distribute or sell live hemp products and hemp cannabinoid products to other hemp business establishments.

"Hemp farm" means an Illinois farm or facility operated by an organization or business that is licensed by the Department of Agriculture to grow hemp.

"Hemp food establishment" means a facility regulated by the Illinois Department of Public Health that incorporates intermediate hemp products in the manufacturing, processing, or preparation of prepackaged or ready-to-eat hemp cannabinoid products intended for human ingestion and which meets the requirements of this Act.

"Hemp processor" means a facility operated by an organization or business that is licensed by the Department of Agriculture to convert raw hemp material into processed hemp products or intermediate hemp products, including the extraction, synthesis, or concentration of constituent chemicals and compounds from raw hemp or intermediate hemp products.

"Hemp production plan" means a plan submitted by the Department to the Secretary of the United States Department of Agriculture pursuant to the federal Agriculture Improvement Act of 2018, Public Law 115-334, and consistent with the Domestic Hemp Production Program pursuant to 7 CFR Part 990 wherein the Department establishes its desire to have primary regulatory authority over the production of hemp.

"Hemp retailer" means a retailer operated by an organization or business that is licensed by the Department of Financial and Professional Regulation to sell live hemp products or hemp cannabinoid products to hemp cannabinoid users or medical patients.

"Hemp social equity participant" means an individual who is an Illinois resident or a business entity located within Illinois that meets one or a combination of any the following criteria:

(1) is an applicant with at least 51% ownership and control by one or more individuals who have resided for at least 5 of the preceding 10 years in a disproportionately impacted area; or

(2) is an applicant with at least 51% ownership and control by at least one individual who:

(A) has been arrested for, convicted of, or adjudicated delinquent for any offense that is eligible for expungement under the Cannabis Regulation and Tax Act; or

(B) is a member of an impacted family.

"Human consumption" means consumption by inhalation or ingestion but does not include topical application.

"Illinois hemp" means hemp grown, processed, or produced by hemp business establishments licensed and located in the State of Illinois, including live hemp products, raw hemp products, intermediate hemp products, and hemp cannabinoid products. "Illinois hemp" includes hemp cannabinoid and intermediate hemp products that are only produced in the State of Illinois and do not incorporate any form of imported hemp.

"Imported hemp" means hemp that incorporates raw hemp or intermediate hemp products not produced in Illinois.

"Industrial hemp" includes intermediate or finished product made or derived from hemp.

"Ingestion" means the process of consuming cannabinoid products through the mouth, whether by swallowing into the gastrointestinal system or through tissue absorption.

"Inhalation" means the process of consuming cannabinoid products through the mouth or nasal passages into the respiratory system.

"Intermediate hemp products" means products that are made from processed hemp that may only be sold to hemp business establishments to be used as ingredients for other intermediate hemp products or final hemp cannabinoid products for human consumption by ingestion or inhalation. "Intermediate hemp products" may include products that contain more than 0.3% THC.

"Labor peace agreement" means an agreement (i) between a hemp business establishment and any labor organization recognized under the National Labor Relations Act, referred to in this Act as a bona fide labor organization, that prohibits labor organizations and members from engaging in picketing, work stoppages, boycotts, and any other economic interference with the cannabis business establishment, (ii) in which the hemp business establishment has agreed not to disrupt efforts by the bona fide labor organization to communicate with, and attempt to organize and represent, the hemp business establishment's employees, (iii) that provides a bona fide labor organization access at reasonable times to areas in which the cannabis business establishment's employees work for the purpose of meeting with employees to discuss their right to representation, employment rights under State law, and terms and conditions of employment, and (iv) does not mandate a particular method of election or certification of the bona fide labor organization.

"Land area" means a farm as defined in Section 1-60 of the Property Tax Code in this State or land or facilities under the control of an institution of higher education.

"Live hemp products" means living plants, plant cuttings, viable seeds, or tissue culture that can be used to propagate new hemp plants, that test under 0.3% THC by weight using high performance liquid chromatography or comparable technologies capable of identifying THC separately from other cannabinoids, and that may only be sold or transferred to other hemp farms or medical patients.

"Medical patient" means an individual who has been issued a medical card under the Compassionate Use of Medical Cannabis Program Act.

"Member of an impacted family" means an individual who has a parent, legal guardian, child, spouse, or dependent, or was a dependent of an individual who, prior to the effective date of this amendatory Act of the 103rd General Assembly, was arrested for, convicted of, or adjudicated delinquent for any offense that is eligible for expungement under subsection (i) of Section 5.2 of the Criminal Identification Act.

"Menu" means the primary writing of the establishment from which a customer makes an order selection, including, but not limited to, breakfast, lunch, and dinner menus, dessert menus, beverage menus, other specialty menus, electronic menus, menu boards, and menus published on the Internet.

"Person" means any individual, partnership, firm, corporation, company, society, association, the State or any department, agency, or subdivision thereof, or any other entity.

"Potency test" means a test on hemp-derived products that measures the amount of cannabinoids, such as THC, in a sample.

"Process" means the conversion of raw industrial hemp plant material into a form that is presently legal to import from outside the United States under federal law.

"Processed hemp products" means products that are derived from hemp that are made for purposes other than human consumption. "Processed hemp products" include hemp fibers, hemp hurd, hempcrete, hemp fuels, hemp topicals and lotions, and other products, such as clothing, plastics, paper, or textiles that use or may incorporate elements of hemp.

"Raw hemp products" means products that are derived from hemp that are not processed or refined with any solvents or chemical reactions. "Raw hemp products" includes hulled hemp seed, hemp seed protein powder, hemp seed oil, hemp stalks, hemp leaves, and artwork incorporating hemp by-products.

"Ready-to-eat hemp cannabinoid product" means a type of hemp cannabinoid product available for human consumption, including time or temperature control, or both, for safety foods, as that term is defined in Section 1-201.10 of the Food Code 2017 of the United States Public Health Service of the Food and Drug Administration, that does not exceed 50 milligrams of THC per serving, and that utilize intermediate hemp products as an input as is produced as a single serving in a retail food establishment.

"Retail sale" means any sale of cannabinoid products that would be subject to the Retailers' Occupation Tax Act.

"Serving" means the amount of product intended to be consumed in a single serving as declared on the label expressed in a common household measure. "Serving size" does not include a fraction of a piece, but a fraction may be indicated by marking or scoring on packaging or labeling.

"THC" means delta-9 tetrahydrocannabinol. "THC" does not include CBD, CBG, CBN, delta-7 THC, delta-8 THC, delta-10 THC, THCa, THCv, THCva, and other yet-to-be-discovered cannabinoids.

(Source: P.A. 102-690, eff. 12-17-21.)

(505 ILCS 89/6 new)

Sec. 6. Sale of hemp cannabinoid products.

(a) The wholesale and retail sale of cannabinoids, hemp concentrate, or any other intermediate hemp cannabinoid product is allowed as provided in this Act.

(b) No person shall offer or sell hemp cannabinoid products, particularly packaged hemp products, to consumers in the State of Illinois unless the person applies for and holds a hemp retailer license issued by the Department of Financial and Professional Regulation. No person shall sell ready-to-eat hemp products to end consumers without holding a hemp food establishment license issued by the Department of Public Health.

(c) A hemp food establishment that sells amt ready-to-eat cannabinoid products shall be exclusively licensed and located in the State of Illinois.

(d) No person shall sell a hemp cannabinoid product to any person under the age of 21 unless the person is a medical patient.

(e) No person shall sell, buy for, distribute samples of, or furnish any cannabinoid product to any person under the age of 21 except as provided in subsection (d).

(f) For purposes of this Act, a medical patient shall not be considered an unlawful user solely as a result of his or her qualifying patient or designated caregiver status. All products purchased by a qualifying patient at a licensed organization shall be lawful products and a distinction shall be made between medical and nonmedical use as a result of the qualifying patient's cardholder status.

(g) No person under 21 years of age in the furtherance or facilitation of obtaining hemp cannabinoid products shall display or use a false or forged identification card or transfer, alter, or deface an identification card.

(h) A hemp food establishment or hemp retailer that sells cannabinoid products intended for inhalation shall post a clear and conspicuous sign directly adjacent to the display of the product that states the following: "THE SALE OF CANNABINOID PRODUCTS INTENDED FOR INHALATION TO PERSONS UNDER THE AGE OF 21 IS PROHIBITED. PROOF OF AGE IS REQUIRED FOR PURCHASE.".

(i) Cannabinoid products may not be mailed, shipped, or otherwise delivered to a purchaser unless, before the delivery to the purchaser, the hemp retailer obtains confirmation that the purchaser is 21 years of age or older or is a medical patient.

(j) Hemp food establishments and hemp retailers shall require proof of age or proof of valid registration under the Compassionate Use of Medical Cannabis Program Act from a purchaser of any cannabinoid products before selling the product to that person. Hemp food establishments and hemp retailers shall exercise diligence in the management and supervision of their premises and in the supervision and training of their employees to prevent the underage sale of these products.

(k) A product containing cannabinoids must not be considered adulterated or unsafe solely because the product contains cannabinoids or other material is extracted or derived from hemp plants.

(l) A person, hemp retailer, or hemp food establishment that violates subsection (e) is guilty of a violation of this Act and is subject to a penalty under Section 17 of this Act. A person under the age of 21 who violates subsection (g) is guilty of a Class A misdemeanor.

(505 ILCS 89/7 new)

Sec. 7. Inhalable cannabinoid products.

(a) No person shall prepare and sell wholesale packaged cannabinoid products that are intended for inhalation unless the person is licensed by the Department as a hemp processor or hemp distributor. No person shall offer inhalable hemp cannabinoid products for sale directly to the public unless the person is licensed as a hemp retailer.

(b) All cannabinoid products that are intended for inhalation shall be manufactured by a source that meets local, State, or federal regulatory good manufacturing practices and health standards from the jurisdiction of origin.

(c) Hemp cannabinoid products intended for inhalation are not subject to the Tobacco Products Tax Act of 1995.

(505 ILCS 89/10.5 new)

Sec. 10.5. Licensing and regulation of hemp farms.

(a) The Department of Agriculture may not limit the number of hemp farm licenses.

(b) No person shall cultivate or grow hemp for commercial purposes unless licensed by the Department of Agriculture and subject to the rules adopted by the Department of Agriculture. Hemp farms may not create hemp extractions without a hemp processor license. A hemp farm may not engage in retail sales without a hemp retailer license.

(c) All licensed hemp farms shall be responsible for ensuring that their harvest of raw hemp products and live hemp products test under 0.3% THC and maybe sold to other hemp businesses or persons under the Compassionate Use of Medical Cannabis Program Act.

(d) Businesses licensed under the Cannabis Regulation and Tax Act may hold a hemp farm license.

(e) The Department of Agriculture may require hemp farm applicants to enter into a labor peace agreement with a bona fide labor organization.

(f) Hemp farm facilities may be located outdoors, in greenhouses, or indoors and may be located on residentially zoned properties in accordance with permitted agricultural use guidelines from local zoning ordinances.

(g) Hemp farms may produce live and raw hemp products. Live hemp products produced by hemp farms may only be sold and exchanged with other hemp business establishments or medical patients.

(h) Raw hemp products may be sold by hemp farms to consumers without a hemp retailer's license.

(505 ILCS 89/10.10 new)

Sec. 10.10. Licensing and regulation of hemp processors.

(a) The Department of Agriculture may not limit the number of hemp processor licenses.

(b) No person shall process hemp unless licensed by the Department of Agriculture and subject to the rules adopted by the Department. In addition to processing hemp, licensed hemp processors may turn hemp plant material into intermediate hemp products or manufacture hemp products for inhalation or topical use. Processors may not grow hemp without a hemp farm license. Processors may not manufacture hemp cannabinoid products for human ingestion without a hemp food establishment license. Processors may not engage in retail sales without a hemp retailer license.

(c) A business licensed under the Cannabis Regulation and Tax Act may hold a hemp processor license.

(d) The Department of Agriculture may require hemp processor applicants to enter into a labor peace agreement with a bona fide labor organization.

(505 ILCS 89/10.15 new)

Sec. 10.15. Regulation of hemp distributors.

(a) The Department of Financial and Professional Regulation shall administer and enforce the provisions of this Act relating to licensing and oversight of hemp distributor establishments unless otherwise provided in this Act.

(b) No person shall operate a hemp distributor establishment for the purpose of serving purchasers of raw hemp products, intermediate hemp products, or hemp cannabinoid products to other in-state hemp processors, hemp distributors, hemp food establishments, hemp retailers, or cottage hemp food operators without a license issued under this Act by the Department of Financial and Professional Regulation.

(c) Subject to the provisions of this Act, the Department of Financial and Professional Regulation may exercise the following powers and duties:

(1) Prescribe forms to be issued for the administration and enforcement of this Act.

(2) Examine, inspect, and investigate the premises, operations, and records of hemp distributor organization applicants and licensees.

(3) Conduct investigations of possible violations of this Act pertaining to hemp distributor establishments.

(4) Conduct hearings on proceedings to refuse to issue or renew licenses or to revoke, suspend, place on probation, reprimand, or otherwise discipline a license holder under this Act or take other nondisciplinary action.

(505 ILCS 89/10.20 new)

Sec. 10.20. Hemp distributor license.

(a) As used in this Section, "Department" means the Department of Financial and Professional Regulation.

(b) The Department may not limit the number of hemp distributor licenses.

(c) Applicants for a hemp distributor license must submit all information required by the Department. Failure by an applicant to submit all required information may result in the application being disqualified.

(d) The Department may verify information contained in each application and accompanying documentation to assess the applicant's veracity and fitness to operate a hemp distributor establishment.

(e) The Department may refuse to issue an authorization to any applicant:

(1) who fails to disclose or falsifies any information called for in the applications;

(2) who has been found guilty of a violation of this Act, who has had any disciplinary order entered against the applicant by the Department, who has entered into a disciplinary or nondisciplinary agreement with the Department, or whose hemp business establishment license was suspended, restricted, revoked, or denied in another state; or

(3) who has engaged in a pattern or practice of unfair or illegal practices, methods or activities in the conduct of owning a hemp business establishment or other business.

The Department may require hemp distributor applicants to enter into a labor peace agreement with a bona fide labor organization.

(f) The Department shall deny the license if any principal officer, board member, or person having a financial or voting interest of 5% or greater on the license is delinquent in filing any required tax returns or paying any amounts owed to the State of Illinois.

(g) The Department shall verify an applicant's compliance with the requirements of this Act and rules before issuing a hemp distributor license.

(h) Businesses licensed under the Cannabis Regulation and Tax Act may hold a hemp distributor license.

(505 ILCS 89/10.25 new)

Sec. 10.25. Operational requirements of hemp distributors.

(a) A hemp distributor establishment shall operate in accordance with the representations made in its application and license materials. It shall be in compliance with this Act and rules.

(b) All live hemp products and hemp cannabinoid products must be obtained from a hemp farm, hemp retailer, hemp food establishment, or hemp distributor licensed by the State of Illinois or from another similarly licensed out-of-state entity.

(c) Hemp distributor establishments shall maintain compliance with State and local building, fire, and zoning requirements and regulations.

(d) A hemp distributor establishment's license allows for a hemp distributor to be operated only at a single location.

(e) A hemp distributor establishment that handles or stores live hemp products for other hemp business establishments must obtain a separate hemp farm license for each location.

(f) A hemp distributor establishment shall ensure that any building or equipment used by the hemp distributor establishment for the storage or sale of live hemp and hemp cannabinoid products are maintained in a clean and sanitary condition appropriate for the products being held and sold.

(g) A hemp distributor establishment shall be free from infestation by insects, rodents, or pests.

(h) A hemp distributor license does not give the organization the right to:

(1) grow hemp;

(2) produce or manufacture hemp or hemp cannabinoid products;

(3) accept or sell hemp cannabinoid products that are not packaged, tested, and labeled in accordance with this Act and any rules that may be adopted pursuant to this Act;

(4) obtain unregistered live hemp or hemp cannabinoid products;

(5) sell live hemp, intermediate hemp products, or hemp cannabinoid products to anyone that is not a registered hemp business establishment;

(6) sell live hemp products or hemp cannabinoid products to hemp cannabinoid users or medical patients unless the hemp distributor has also obtained a hemp retailer license; or

(7) violate any other requirements or prohibitions set by Department of Financial and Professional Regulation rules.

(i) A hemp distributor license may be obtained by an out-of-state entity, if the applicant:

(1) and all principal officers on the application retains a registered agent or office and agrees to submit to tax nexus within the State of Illinois for jurisdictional, regulatory, and enforcement purposes;

(2) agrees to only sell to hemp business establishments registered live hemp products that are registered with the Department of Agriculture;

(3) agrees to only sell to hemp business establishments intermediate hemp products that are tested in accordance with the rules adopted pursuant to this Act;

(4) agrees to only sell to hemp business establishments registered hemp cannabinoid products that are registered with the State of Illinois; and

(5) maintains a log of all sales to hemp business establishments located within the State of Illinois to be submitted for inspection by the Department of Financial and Professional Regulation.

(j) A hemp distributor establishment has the right to obtain and concurrently operate a hemp farm, hemp processor, hemp food establishment, and hemp retail establishment licenses at its location so long as it is in compliance with all local regulations and zoning ordinances.

(505 ILCS 89/10.30 new)

Sec. 10.30. Hemp distributor recordkeeping.

(a) A hemp distributor shall keep electronically, or at the licensed address or place of business located within the State of Illinois, complete and accurate records of all sales or other dispositions of live hemp products, intermediate hemp products, and hemp cannabinoid products sold, whether for itself or for another, together with a physical inventory made as of the close of each period for which a return is required, covering all live hemp products, intermediate hemp products, and hemp cannabinoid products on hand.

(b) A hemp distributor is required to retain invoices and bills of lading covering purchases and invoices and duplicate copies of bills of lading covering sales of live hemp products, intermediate hemp products, and hemp cannabinoid products.

To support deductions on the ground that deliveries of live hemp products, intermediate hemp products, and hemp cannabinoid products were made outside of the State of Illinois, records shall include satisfactory evidence of delivery to and receipt by out-of-state consignees.

(c) A physical inventory must be taken and a record thereof preserved as of the close of business on the last business day of each calendar month.

Hemp distributors shall include an inventory on hand of all live hemp products, intermediate hemp products, and hemp cannabinoid products, including those in bond and other warehouses, and shall designate whether the hemp products are owned by the hemp distributor or whether such hemp products are lawfully held by the distributor as agent for another.

(d) A hemp distributor must, at the time of sale of any live hemp products, intermediate hemp products, and hemp cannabinoid products, render to the purchaser an invoice describing the hemp product sold (including the tax rate category applicable to the product sold), the date of sale, to whom sold, and the quantity sold. Duplicate copies of all the invoices must be made and preserved by the hemp distributor for audit purposes.

When a hemp distributor sells live hemp products, intermediate hemp products, or hemp cannabinoid products to another hemp business establishment that is not a cottage hemp food operator, each original and duplicate invoice pertaining to the sale must be printed, stamped, or bear in writing language substantially as follows: "Hemp products described herein sold without payment of Illinois cannabinoid retail hemp tax to holder of Illinois hemp license no. XXX.".

When a hemp distributor sells intermediate hemp products to a cottage hemp food operator, each original and duplicate invoice pertaining to the sale must be printed, stamped, or bear in writing language substantially as follows "Payment of Illinois cannabinoid retail hemp tax made by vendor issuing this invoice.".

Failure of any hemp distributor to print, stamp, or write upon any invoice covering live hemp products, intermediate hemp products, or hemp cannabinoid products sold in Illinois any statement relating to payment of the cannabinoid retail hemp tax shall oblige the Department of Financial and Professional Regulation to assume that the hemp distributor is liable for tax with respect to the sales.

No hemp distributor shall sell or deliver any live hemp products, intermediate hemp products, or hemp cannabinoid products to another for resale, unless the person to whom lire hemp products are sold or delivered is authorized to receive the products under the provisions of the Act. A hemp distributor must place the license number of the person receiving the products on all receipts, bills, invoices, and statements covering the sales or deliveries.

(e) Hemp distributor establishment records must be maintained electronically for 3 years and be available for inspection by the Department of Financial and Professional Regulation upon request, unless the Department, in writing, authorizes the records' destruction or disposal at an earlier date. Books and records must be maintained at the licensed address that is located within the State of Illinois. The Department may in its discretion prescribe uniform methods for keeping the records.

(f) If a hemp distributor closes due to insolvency, revocation, bankruptcy, or for any other reasons, all records must be preserved at the expense of the hemp distributor for at least 3 years in a form and location in Illinois acceptable to the Department. The hemp distributor shall keep the records longer if requested by the Department. The hemp distributor shall notify the Department of the location where the hemp retailer records are stored or transferred.

(g) A hemp distributor selling intermediate hemp products to cottage food operators are responsible for maintaining cottage food registration records and collecting cannabinoid retail taxes on behalf of the cottage food operator.

(505 ILCS 89/10.35 new)

Sec. 10.35. Regulation of hemp retailers.

(a) As used in this Section, "Department" means the Department of Financial and Professional Regulation.

(b) The Department shall administer and enforce the provisions of this Act relating to licensing and oversight of hemp retailers unless otherwise provided in this Act.

(c) No person shall operate a hemp retail establishment for the purpose of serving purchasers of hemp cannabinoid products without a license issued under this Act by the Department.

(d) Subject to the provisions of this Act, the Department may exercise the following powers and duties:

(1) Prescribe forms to be issued for the administration and enforcement of this Act.

(2) Examine, inspect, and investigate the premises, operations, and records of hemp retailer applicants and licensees.

(3) Conduct investigations of possible violations of this Act pertaining to hemp retailer.

(4) Conduct hearings on proceedings to refuse to issue or renew licenses or to revoke, suspend, place on probation, reprimand or otherwise discipline a license holder under this Act or take other nondisciplinary action.

(e) Businesses licensed under the Cannabis Regulation and Tax Act may hold a hemp retailer license.

(f) The Department may not limit the number of hemp retailer licenses.

(g) The Department may not limit the number of hemp retailer licenses an individual may hold.

(h) Applicants for a hemp retailer license must submit all information required by the Department. Failure by an applicant to submit all required information may result in the application being disqualified.

(i) The Department may verify information contained in each application and accompanying documentation to assess the applicant's veracity and fitness to operate a hemp retailer establishment.

(j) The Department may refuse to issue a license to any applicant:

(1) who fails to disclose or falsifies any information called for in the application;

(2) who has been found guilty of a violation of this Act, who has had any disciplinary order entered against the applicant by the Department, who has entered into a disciplinary or nondisciplinary agreement with the Department, or whose hemp business establishment license was suspended, restricted, revoked, or denied in another state; or

(3) who has engaged in a pattern or practice of unfair or illegal practices, methods, or activities in the conduct of owning a hemp business establishment or other business.

(k) The Department may require hemp retailer applicants to enter into a labor peace agreement with a bona fide labor organization.

(l) The Department shall deny the license if any principal officer, board member or persons having a financial or voting interest of 5% or greater on the license is delinquent in filing any required tax returns or paying any amounts owed to the State of Illinois.

(m) The Department shall verify an applicant's compliance with the requirements of this Act and the rules adopted under this Act before issuing a hemp retailer license.

(505 ILCS 89/10.40 new)

Sec. 10.40. Operational requirements of hemp retailers.

(a) A hemp retailer shall operate in accordance with the representations made in its application and license materials. It shall be in compliance with this Act and rules.

(b) All live hemp products and hemp cannabinoid products must be obtained from a hemp farm, hemp distributor, hemp food establishment, or another hemp retailer licensed by the State of Illinois or from another similarly licensed out-of-state entity.

(c) A hemp retailer establishment that handles or stores live hemp products for the purpose of selling live hemp products to medical patients must obtain a separate hemp farm license for that location.

(d) A hemp retailer establishment that obtains a hemp food establishment license may prepare and sell ready-to-eat hemp cannabinoid products.

(e) A hemp retailer establishment that maintains a hemp food establishment license may host cottage hemp food operators on premises for special events lasting no longer than 3 days.

(f) A hemp retailer establishment shall maintain compliance with State and local building, fire, and zoning requirements and regulations.

(g) A hemp retailer license allows for a hemp retailer to be operated only at a single location.

(h) A hemp retailer establishment shall ensure that any building or equipment used by the hemp retailer establishment for the sale of hemp, hemp cannabinoid products, and ready-to-eat hemp cannabinoid products are maintained in a clean and sanitary condition.

(i) A hemp retailer establishment shall be free from infestation by insects, rodents, or pests.

(j) A hemp retailer license does not give the licensee the right to:

(1) grow hemp;

(2) produce or manufacture hemp or hemp cannabinoid products;

(3) accept and sell hemp cannabinoid products that are not packaged, tested, and labeled in accordance with this Act and any rules that may be adopted pursuant to this Act;

(4) obtain unregistered live hemp or hemp cannabinoid products;

(5) sell live hemp to a purchaser unless the purchaser is registered under the Compassionate Use of Medical Cannabis Program;

(6) sell hemp cannabinoid products to a purchaser unless the purchaser is a medical patient or that the purchaser has been verified to be 21 years of age or older; or

(7) violate any other requirements or prohibitions set by Department rules.

(k) A hemp retailer license may be obtained by an out-of-state entity if the applicant:

(1) and all principal officers on the application retains a registered agent or office and agree to submit to tax nexus within the State of Illinois for jurisdictional, regulatory, and enforcement purposes;

(2) agrees to only sell to residents located within the State of Illinois registered live hemp products that are registered with the Department of Agriculture;

(3) agrees to only sell to residents located within the State of Illinois registered hemp cannabinoid products that are registered with the State of Illinois; and

(4) maintains a log of all sales to residents located within the State of Illinois to be submitted for inspection by the Department.

(l) A hemp retailer has the right to obtain and operate hemp farm, hemp distributor, hemp processor, or hemp food establishments at its location if it is in compliance with all local regulations and zoning ordinances.

(m) A hemp retailer is responsible for collecting and remitting cannabinoid retail taxes.

(505 ILCS 89/10.45 new)

Sec. 10.45. Hemp retailer recordkeeping.

(a) Hemp retailer records must be maintained electronically for 3 years and be available for inspection by the Department upon request. Required written records include, but are not limited to, the following:

(1) Operating procedures.

(2) Inventory records, policies, and procedures.

(3) Business records, including, but not limited to:

(A) Assets and liabilities.

(B) Monetary transactions.

(C) Written or electronic accounts, including bank statements, journals, ledgers and supporting documents, agreements, checks, invoices, receipts, and vouchers.

(D) Any other financial accounts reasonably related to the hemp retailer operations.

(b) If a hemp retailer closes due to insolvency, revocation, bankruptcy, or for any other reasons, all records must be preserved at the expense of the hemp retailer for at least 3 years in a form and location in Illinois acceptable to the Department. The hemp retailer shall keep the records longer if requested by the Department. The hemp retailer shall notify the Department of the location where the hemp retailer records are stored or transferred.

(505 ILCS 89/10.50 new)

Sec. 10.50. Regulation of hemp food establishments.

(a) As used in this Section, "Department" means the Department of Public Health.

(b) The Department shall administer and enforce the provisions of this Act relating to licensing and oversight of hemp food establishments unless otherwise provided in this Act.

(c) No person shall operate a hemp food establishment for the purpose of serving hemp cannabinoid products for human ingestion or ready-to-eat hemp cannabinoid products without a license issued under this Act.

(d) Subject to the provisions of this Act, the Department may exercise the following powers and duties:

(1) Prescribe forms to be issued for the administration and enforcement of this Act.

(2) Examine, inspect, and investigate the premises, operations, and records of hemp food establishment applicants and licensees.

(3) Conduct investigations of possible violations of this Act pertaining to hemp food establishments.

(4) Conduct hearings on proceedings to refuse to issue or renew licenses or to revoke, suspend, place on probation, reprimand, or otherwise discipline a license holder under this Act or take other nondisciplinary action.

(e) Businesses licensed under the Cannabis Regulation and Tax Act may hold a hemp food establishment license.

(505 ILCS 89/10.55 new)

Sec. 10.55. Hemp food establishment licenses.

(a) As used in this Section, "Department" means the Department of Public Health.

(b) The Department may not limit the number of hemp food establishment licenses.

(c) The Department shall not limit the number of licenses an individual may hold. Applicants for a hemp food establishment license must submit all information required by the Department. Failure by an applicant to submit all required information may result in the application being disqualified.

(d) The Department may verify information contained in each application and accompanying documentation to assess the applicant's veracity and fitness to operate a hemp food establishment.

(e) The Department may refuse to issue an authorization to any applicant:

(1) who fails to disclose or falsifies any information called for in the application;

(2) who has been found guilty of a violation of this Act, who has had any disciplinary order entered against the applicant by the Department, who has entered into a disciplinary or nondisciplinary agreement with the Department, or whose hemp business establishment license was suspended, restricted, revoked, or denied in another State; or

(3) who has engaged in a pattern or practice of unfair or illegal practices, methods, or activities in the conduct of owning a hemp business establishment or other business.

(f) The Department may require hemp food establishment applicants to enter into a labor peace agreement with a bona fide labor organization.

(g) The Department shall deny the license if any principal officer, board member, or persons having a financial or voting interest of 5% or greater on the license is delinquent in filing any required tax returns or paying any amounts owed to the State of Illinois.

(h) The Department shall verify an applicant's compliance with the requirements of this Act and rules before issuing a hemp food establishment license.

(505 ILCS 89/10.60 new)

Sec. 10.60. Operational requirements of hemp food establishments.

(a) A hemp food establishment dealing in the manufacture and sale of food items that does not comply with the existing State laws related to food handling or does not comply with the health and food handling regulations of a unit of local government having jurisdiction over the establishment may be enjoined from doing business in the following manner: the Department of Public Health or a local department of health may seek an injunction in the circuit court for the county in which the establishment is located. An injunction, if granted, shall prohibit the hemp food establishment from selling hemp cannabinoid products for human ingestion until it complies with any applicable State law or regulations of a unit of local government. However, no injunction may be sought or granted before January 1, 2025, to enforce any rule or regulation requiring a licensed food business to adhere to those rules and regulations.

(b) The Department of Public Health shall adopt and enforce rules for the manufacture and processing of hemp cannabinoid products for human ingestion at a hemp food establishment, and, for that purpose, it may at all times enter every building, room, basement, enclosure, or premises occupied or used, or suspected of being occupied or used, for the production, preparation, manufacture for sale, storage, sale, processing, distribution, or transportation and to inspect the premises of a hemp food establishment together with all utensils, fixtures, furniture, and machinery used for the preparation of these products.

(c) A hemp food establishment shall be under the operational supervision of a certified food service sanitation manager in accordance with rules promulgated under this Act.

(d) A hemp food establishment shall operate in accordance with the representations made in its application and license materials. It shall be in compliance with this Act and rules.

(e) A hemp food establishment shall comply with the food handling, preparation, packaging, and labeling provisions of the Illinois Food, Drug and Cosmetic Act, the Food Handling Regulation Enforcement Act, and the Sanitary Food Preparation Act.

(f) A hemp food establishment shall obtain raw hemp products from a hemp farm or hemp distributor.

(g) A hemp food establishment shall obtain intermediate hemp products from a hemp distributor.

(h) A hemp food establishment that obtains a hemp retailer license may prepare and sell ready-to-eat hemp cannabinoid products.

(i) A hemp food establishment shall maintain compliance with State and local building, fire, and zoning requirements.

(j) A hemp food establishment license allows for a hemp food establishment to be operated only at a single location.

(k) A hemp food establishment shall ensure that any building or equipment used by the hemp food establishment for the storage, preparation, or sale of hemp cannabinoid products for human ingestion and ready-to-eat hemp cannabinoid products are maintained in a clean and sanitary condition.

(l) A hemp food establishment shall be free from infestation by insects, rodents, or pests.

(m) A hemp food establishment, when combined with an on-site hemp retailer license, allows for the preparation and sale of ready-to-eat hemp cannabinoid products.

(n) A hemp food establishment license does not give the establishment the right to:

(1) grow hemp;

(2) process hemp;

(3) accept and use intermediate hemp products that are not packaged, tested, and labeled in accordance with this Act;

(4) distribute intermediate hemp products to cottage hemp food operators;

(5) obtain unregistered live hemp or hemp cannabinoid products;

(6) prepare and sell ready-to-eat hemp cannabinoid products to a purchaser unless the individual is registered under the Compassionate Use of Medical Cannabis Program or that the purchaser has been verified to be 21 years of age or older; or

(7) violate any other requirements or prohibitions set by Department of Public Health rules.

(505 ILCS 89/10.65 new)

Sec. 10.65. Recipes and dosing of ready-to-eat hemp cannabinoid products. In order to sell ready-to-eat hemp cannabinoid products, a hemp food establishment shall do all of the following:

(1) Use only intermediate hemp products that have been fully tested in accordance with this Act.

(2) Keep THC dosing at or below 50 milligrams per serving.

(3) Submit a standard operating procedure for dosing to the Department for approval and registration. Such approval shall be granted within 30 days of submission unless the Department provides good cause, in writing, for withholding approval.

(4) Submit the recipe, at the hemp food establishment's expense, to a third-party testing laboratory for potency testing to ensure 0.3% THC compliance on an annual basis.

(5) Use only the varietal or proportional varietals of ingredients included in the tested recipe for all subsequent batches of the recipe.

(6) Provide documentation of the annual test results of the recipe submitted under this paragraph upon registration and to an inspector upon request during any inspection authorized by the Department.

(505 ILCS 89/10.70 new)

Sec. 10.70. Disclosure and labeling of ready-to-eat hemp cannabinoid products.

(a) Hemp food establishments must ensure that the total milligram content of each type of Cannabinoid exceeding one milligram contained in each ready-to-eat hemp cannabinoid menu item is listed on the menu adjacent to the name or the price of the associated menu item.

(b) Hemp food establishments must ensure that served ready-to-eat hemp cannabinoid menu items include a label that:

(1) indicates the total milligram content of the served item; and

(2) provides a QR code for a link to a web page containing:

(A) a copy of the testing results of the intermediate hemp product used;

(B) a copy of the dosing standard operating procedure; and

(C) a copy of a representative compliance test for the recipe.

(505 ILCS 89/10.75 new)

Sec. 10.75. Recordkeeping of ready-to-eat hemp cannabinoid products.

(a) Hemp food establishment records must be maintained electronically for 3 years and be available for inspection by the Department upon request. Required records include, but are not limited to, the following:

(1) Operating procedures and recipes.

(2) Inventory records, policies, and procedures.

(3) Batch creation logs of intermediate hemp products.

(4) Dosing records of ready-to-eat hemp cannabinoid products.

(b) If a hemp food establishment closes due to insolvency, revocation, bankruptcy, or for any other reasons, all records must be preserved at the expense of the hemp food establishment for at least 3 years in a form and location in Illinois acceptable to the Department. The hemp food establishment shall keep the records longer if requested by the Department. The hemp food establishment shall notify the Department of the location where the hemp food establishment records are stored or transferred.

(505 ILCS 89/10.80 new)

Sec. 10.80. Regulation of cottage hemp food operators.

(a) As used in this Section, "Department" means the Department of Public Health.

(b) The Department shall administer and enforce the provisions of this Act relating to licensing and oversight of cottage hemp food operators unless otherwise provided in this Act.

(c) No person shall operate as a cottage hemp food operator for the purpose of serving purchasers of ready-to-eat hemp cannabinoid products without a license issued under this Act.

(d) Subject to the provisions of this Act, the Department may exercise the following powers and duties:

(1) Prescribe forms to be issued for the administration and enforcement of this Act.

(2) Examine, inspect, and investigate the premises, operations, and records of hemp food establishment applicants and licensees.

(3) Conduct investigations of possible violations of this Act pertaining to hemp food establishments.

(4) Conduct hearings on proceedings to refuse to issue or renew licenses or to revoke, suspend, place on probation, reprimand, or otherwise discipline a license holder under this Act or take other nondisciplinary action.

(505 ILCS 89/10.85 new)

Sec. 10.85. Cottage hemp food operator licenses.

(a) As used in this Section, "Department" means the Department of Public Health.

(b) The Department may not limit the number of cottage hemp food operator licenses issued.

(c) The Department shall not limit the number of licenses an individual may hold.

(d) The fee for a cottage hemp food operator license is $75.

(e) An applicant for a cottage hemp food operator license shall be an individual.

(f) An applicant for a hemp food establishment license must submit all information required by the Department. Failure by an applicant to submit all required information may result in the application being disqualified.

(g) The Department may verify information contained in each application and accompanying documentation to assess the applicant's veracity and fitness to operate a hemp food establishment.

(h) The Department may refuse to issue a license to any applicant:

(1) who fails to disclose or falsifies any information called for in the application;

(2) who has been found guilty of a violation of this Act, who has had any disciplinary order entered against the applicant by the Department, who has entered into a disciplinary or nondisciplinary agreement with the Department, or whose hemp business establishment license was suspended, restricted, revoked, or denied in another state; or

(3) who has engaged in a pattern or practice of unfair or illegal practices, methods or activities in the conduct of owning a hemp business establishment or other business.

(i) The Department shall deny the license if the applicant is delinquent in filing any required tax returns or paying any amounts owed to the State of Illinois.

(j) The Department shall verify an applicant's compliance with the requirements of this Act and rules before issuing a cottage hemp food operator license.

(k) A licensee under the Cannabis Regulation and Tax Act may not hold a hemp cottage food license.

(505 ILCS 89/10.90 new)

Sec. 10.90. Operational requirements of cottage hemp food operators.

(a) Cottage hemp food operators must register with a hemp distributor annually.

(b) Cottage hemp food operators are responsible for paying cannabinoid retail taxes to their hemp distributor.

(c) Cottage hemp food operators have an annual intermediate hemp products purchase limit equivalent to 1,000 grams of THC.

(d) Cottage hemp food operators must comply with all provisions of Section 4 of the Food Handling Regulation Enforcement Act.

(e) In order to produce cottage hemp cannabinoid products, the cottage hemp food operator shall:

(1) use only intermediate hemp products from its registered distributor that have been fully tested in accordance with this Act;

(2) attest to following a standard operating procedure submitted by its licensed hemp distributor for dosing to the Department of Public Health for approval and registration;

(3) keep THC dosing at or below 50 milligrams per serving.

(4) use no more than the equivalent of 1,000 grams of THC in intermediate hemp products on an annual basis; and

(5) register with a hemp distributor, who is responsible for collecting and remitting cannabinoid retail taxes on behalf of the cottage hemp food operator.

(f) In order to sell cottage hemp cannabinoid products, the cottage hemp food operator shall display at the point of sale:

(1) A QR code with to links to a web page containing:

(A) A copy of the testing results of the intermediate hemp product used.

(B) A copy of the registered distributor's dosing SOP.

(2) Notice in a prominent location that states "This product was made using tested cannabinoids but was produced in a home kitchen not inspected by a health department that may also process common food allergens and may not be accurately dosed. If you have safety concerns, contact your local health department."

Cottage hemp food products may not be sold to other hemp business establishments.

(g) Cottage hemp cannabinoid products must conform with the labeling requirements of the Illinois Food, Drug and Cosmetic Act and the food shall be affixed with a prominent label that includes the following:

(1) The name of the cottage hemp food operation.

(2) The identifying registration number provided for the cottage hemp food operation.

(3) A label displaying the total milligram content of each type of cannabinoid exceeding 1 milligram contained in each cottage hemp cannabinoid product.

(4) The following phrase in prominent lettering "This product was made using tested cannabinoids but was produced in a home kitchen not inspected by a health department that may also process common food allergens and may not be accurately dosed. If you have safety concerns, contact your local health department."

(h) Cottage hemp cannabinoid products produced by a cottage hemp food operator shall be sold directly to hemp cannabinoid users or medical patients within the State of Illinois for their own consumption and not for resale. Sales directly to consumers include, but are not limited to, sales at or through:

(1) farmers markets;

(2) fairs, festivals, public events, or online;

(3) pickup from the private home or farm of the cottage hemp food operator if the pickup is not prohibited by ordinance of the unit of local government that applies equally to all cottage food operations; in a municipality with a population of 1,000,000 or more, a cottage hemp food operator shall comply with an ordinance of the municipality that applies equally to all home-based businesses;

(4) delivery to the customer;

(5) pickup from a third-party private property with the consent of the third-party property holder; and

(6) hemp retailer establishments.

(505 ILCS 89/10.95 new)

Sec. 10.95. Fee waivers for hemp social equity participants.

(a) For hemp social equity participants, the Department of Financial and Professional Regulation and the Department of Agriculture shall waive 50% of any nonrefundable permit application fees, any nonrefundable fees associated with operating a hemp business establishment, and financial requirements for a hemp social equity participant who is applying for the individual's first hemp business establishment permit.

(b) If the Department of Financial and Professional Regulation or the Department of Agriculture determines that an applicant who applied as a hemp social equity participant is not eligible for that status, the applicant shall be provided an additional 10 days to provide alternative evidence that he or she qualifies as a hemp social equity participant. Alternatively, the applicant may pay the remainder of the waived fee and will not be considered as a hemp social equity participant. If the applicant cannot do either, then the Departments may keep the initial permit fee.

(505 ILCS 89/10.100 new)

Sec. 10.100. Limitations.

(a) Nothing in this Act:

(1) prohibits the issuance of a license or permit to a person also holding a hemp business license authorizing the manufacture, distribution, or retail sale of cannabinoid products;

(2) allows any agreement between a licensing authority and license or permit holder that prohibits the license or permit holder from also holding a cannabinoid manufacturer, distributor, or retailer license; or

(3) allows the revocation or suspension of a license or permit, or the imposition of a penalty on a license or permit holder, due to the license or permit holder also holding a hemp business license.

(b) For purposes of this Section, "hemp business license" means a hemp distributor, hemp cultivator, hemp processor, hemp retailer, or hemp food establishment license issued by the applicable Department.

(505 ILCS 89/11 new)

Sec. 11. Independent testing labs.

(a) No laboratory shall handle, test, or analyze hemp or hemp cannabinoid products unless approved by the Department of Agriculture in accordance with this Section. In lieu of Department approval, all laboratories with a valid United States Drug Enforcement Administration hemp analytical testing laboratory registration, a current cannabis laboratory license issued by the Department, or a valid ISO/IEC 17025 certification are considered approved.

(b) Notwithstanding subsection (a), a laboratory may not be approved to handle, test, or analyze hemp or hemp cannabinoid products unless the laboratory:

(1) is accredited by a private laboratory accrediting organization;

(2) is independent from persons involved in the hemp industry in Illinois, including that no person with a direct or indirect interest in the laboratory has a direct or indirect financial, management, or other interest in an Illinois hemp business entity; and

(3) has employed at least one person to oversee and be responsible for the laboratory testing who has earned, from a college or university accredited by a national or regional certifying authority, at least:

(A) a master's degree in chemical or biological sciences and a minimum of 2 years' post degree laboratory experience; or

(B) a bachelor's degree in chemical or biological sciences and a minimum of 4 years' post degree laboratory experience.

(4) Each independent testing laboratory that claims to be accredited must provide the Department of Agriculture with a copy of the most recent annual inspection report granting accreditation and every annual report thereafter.

(c) No more than 30 days prior to harvest, a hemp farm shall submit to an approved laboratory a sample of hemp to verify that the THC concentration does not exceed 0.3% on a dry-weight basis in the following manner:

(1) A sample shall be sent for each separate strain and for each separate growing area at the Department of Agriculture's discretion.

(2) A sample must consist of at least one ounce, weighed at the time of harvest, and consist of full buds, along with any attached leaves and stems.

(3) Quantitative laboratory determination of THC concentration on a dry-weight basis must be performed.

(d) A test result with a THC concentration on a dry-weight basis that exceeds 0.3% but is less than 0.7% may be retested at the expense of the licensee. A request for a retest by the licensee must be received by the Department of Agriculture within 3 days after initial receipt of the original test results by the licensee.

(e) All harvested hemp receiving a sample test result with a THC concentration on a dry-weight basis that exceeds 0.3% and is not retested at the request of the licensee shall be destroyed.

(f) All harvested hemp receiving both a sample test result and a sample retest result with THC concentrations on a dry-weight basis that exceeds 0.3% shall be destroyed.

(g) All harvested hemp receiving a sample test result with a THC concentration on a dry-weight basis that equals or exceeds 1.0% shall be destroyed.

(h) All harvested hemp awaiting test results shall be stored by the licensee or processor and shall not be processed or transported until test results are obtained and the hemp is released by the Department.

(505 ILCS 89/11.5 new)

Sec. 11.5. Laboratory testing of intermediate hemp products.

(a) Immediately after the manufacturing or processing of any intermediate hemp product, each batch shall be tested by an approved laboratory for:

(1) microbiological contaminants;

(2) mycotoxins;

(3) pesticide active ingredients; and

(4) residual solvents.

An active ingredient analysis shall also be conducted.

(b) The laboratory shall immediately return or dispose of the intermediate hemp product upon the completion of any testing, use, or research. If intermediate hemp is disposed of, it shall be done in compliance with Department of Agriculture rule.

(c) If a sample of the intermediate hemp product does not pass the microbiological, mycotoxin, pesticide chemical residue, or solvent residual test, based on the standards established by the Department of Agriculture, the following applies:

(1) If the sample failed the pesticide chemical residue test, the entire batch from which the sample was taken shall, if applicable, be recalled as provided by rule.

(2) If the sample failed any other test, the batch may be used to make a CO₂-based or solvent-based extract. After processing, the CO₂-based or solvent-based extract must still pass all required tests.

(d) The Department shall establish standards for microbial, mycotoxin, pesticide residue, solvent residue, or other standards for the presence of possible contaminants.

(e) The laboratory shall file with the Department an electronic copy of each laboratory test result for any batch that does not pass the microbiological, mycotoxin, or pesticide chemical residue test at the same time that it transmits those results to the hemp processor. In addition, the laboratory shall maintain the laboratory test results for at least 5 years and make them available at the Department's request.

(f) The hemp processor or hemp distributor shall provide to a hemp business establishment the laboratory test results for each batch of intermediate hemp products purchased by the hemp business establishment, if sampled. A hemp business establishment must have these laboratory results available online or in-person upon request to purchasers.

(505 ILCS 89/11.10 new)

Sec. 11.10. Laboratory testing for hemp cannabinoid products utilizing extraction methods.

(a) Hemp processors, hemp distributors, and hemp food establishments must begin a new batch cycle every time a specific hemp cannabinoid product is made. A manufacturer of hemp cannabinoid products utilizing hemp cannabinoids directly extracted from raw hemp or untested intermediate hemp products and hemp cannabinoid products for human inhalation shall be tested by the approved laboratory for:

(1) potency;

(2) microbiological contaminants;

(3) mycotoxins;

(4) pesticide active ingredients; and

(5) residual solvents.

An active ingredient analysis shall also be conducted.

(b) The laboratory shall immediately return or dispose of the hemp cannabinoid product upon the completion of any testing, use, or research. If the hemp cannabinoid product is disposed of, it shall be done in compliance with Department rule.

(c) If a sample of the hemp cannabinoid does not pass the microbiological, mycotoxin, pesticide chemical residue, or solvent residual test, based on the standards established by the Department, the following applies:

(1) If the sample failed the pesticide chemical residue test, the entire batch from which the sample was taken shall, if applicable, be recalled as provided by rule.

(2) If the sample failed any other test, the batch may be used to make a CO₂-based or solvent-based extract. After processing, the CO₂-based or solvent-based extract must still pass all required tests.

(d) The Department of Agriculture shall establish standards for microbial, mycotoxin, pesticide residue, solvent residue, or other standards for the presence of possible contaminants which shall be no more strict than comparable food or inhalable product testing requirements.

(e) The laboratory shall file with the Department of Agriculture an electronic copy of each laboratory test result for any batch that does not pass the microbiological, mycotoxin, or pesticide chemical residue test at the same time that it transmits those results to the hemp processor, distributor or food establishment. In addition, the laboratory shall maintain the laboratory test results for at least 5 years and make them available at the Department of Agriculture's request.

(f) The hemp processor, hemp distributor, or hemp food establishment shall provide to a hemp business establishment the laboratory test results for each batch of hemp cannabinoid products purchased by the hemp business establishment, if sampled. A hemp business establishment must have these laboratory results available upon request to purchasers.

(505 ILCS 89/11.15 new)

Sec. 11.15. Laboratory testing for hemp cannabinoid products for human ingestion.

(a) Hemp food establishments using intermediate hemp products to create hemp cannabinoid products for human ingestion that have passed testing under Section 11.10 only need to test for federal compliance if all other ingredients and inputs to be added into the hemp cannabinoid products are food grade. The manufacturer of hemp cannabinoid products for human ingestion must submit a representative sample of the batch cycle every time a different intermediate hemp product batch is used to an independent, accredited laboratory, which shall be tested by the approved laboratory for potency.

(b) The laboratory shall immediately return or dispose of the hemp cannabinoid product upon the completion of any testing, use, or research. If the hemp cannabinoid product is disposed of, it shall be done in compliance with Department rule.

(c) If a sample of the hemp cannabinoid does not pass the 0.3% THC compliance test, based on the standards established by the Department, the following applies:

(1) the batch may be used to make a CO₂-based or solvent-based extract; and

(2) after processing, the CO₂-based or solvent-based extract must pass all required tests.

(d) The hemp distributor or hemp food establishment shall provide to a hemp business establishment the laboratory test results for each batch of hemp cannabinoid products purchased by the hemp business establishment, if sampled. A hemp business establishment must have these laboratory results available upon request to purchasers.

(505 ILCS 89/11.20 new)

Sec. 11.20. Laboratory testing for ready-to-eat hemp cannabinoid products using tested intermediate hemp products.

(a) Retail hemp food establishments using intermediate hemp products that have passed testing under Section 11 to create ready-to-eat hemp cannabinoid products only need to test for federal compliance if all other ingredients and inputs to be added into the hemp cannabinoid products are food grade. The retail hemp food establishment creating the ready-to-eat hemp cannabinoid product for a manufacturer of a product regulated under this Section must submit a representative sample of its registered recipe using its registered dosing standard operating procedure either (1) annually or (2) every time a different intermediate hemp product batch is used to an independent, accredited laboratory, which shall be tested by the approved laboratory for potency.

(b) The laboratory shall immediately return or dispose of ready-to-eat hemp cannabinoid product upon the completion of any testing, use, or research. If the ready-to-eat hemp cannabinoid product is disposed of, it shall be done in compliance with Department rule.

(c) The retail hemp food establishment shall provide to its customers a copy of its registered recipe, registered dosing standard operating procedure. A hemp distributor or hemp food establishment shall provide to a hemp business establishment the laboratory test results for each batch of hemp cannabinoid products purchased by the hemp business establishment, if sampled. A hemp business establishment must have these laboratory results available upon request to purchasers.

(505 ILCS 89/12 new)

Sec. 12. Hemp cannabinoid product packaging and labeling.

(a) A hemp cannabinoid product, except for cottage hemp cannabinoid products, produced for sale to the general public shall be registered with the Department on forms provided by the Department. Each product registration must include a label and the required registration fee at the rate established by the Department not exceed $50 per registered product. The registration fee is for the name of the product offered for sale and one fee is sufficient for all package sizes.

(b) A hemp cannabinoid product, except for ready-to-eat hemp cannabinoid products and cottage hemp cannabinoid products, such as packaged cannabinoid products, shall be labeled before sale, and each label shall be securely affixed to the package and shall state in English:

(1) The name and post office box or address of the relevant hemp distributor, hemp processor, or hemp food establishment where the item was manufactured.

(2) The common or usual name of the item and the registered name of the hemp cannabinoid product that was registered with the Department under subsection (a).

(3) The "use by" date.

(4) Content list, which must include:

(A) the minimum and maximum percentage content by weight for any hemp-derived cannabinoid exceeding one milligram; and

(B) all other ingredients of the product, including any colors, artificial flavors, and preservatives, listed in descending order by predominance of weight shown with common or usual names.

(5) For hemp cannabinoid products tested under Section 11.10:

(A) the date of testing and packaging and the identification of the independent testing laboratory; and

(B) a pass-fail rating based on the laboratory's microbiological, mycotoxins, and pesticide and solvent residue analysis.

(6) For hemp cannabinoid products tested under Section 11.15,

(A) the date of Section 50-10 intermediate hemp product testing, packaging and the identification of the independent testing laboratory; and

(B) a pass-fail rating based on the laboratory's microbiological, mycotoxins, and pesticide and solvent residue analysis of the Section 11.5 intermediate hemp product.

The required packaging elements of this subsection may be satisfied by means of a QR code linking to a website where the information is available for a consumer.

(c) Packaging for packaged hemp cannabinoid products must not contain information that:

(1) is false or misleading;

(2) promotes excessive consumption;

(3) depicts a person under 21 years of age consuming hemp cannabinoids;

(4) includes the image of a cannabis or hemp leaf;

(5) includes images designed or likely to appeal to minors, including cartoons, toys, animals, or children, or any other likeness to images, characters; phrases that are popularly used to advertise to children; or any packaging or labeling that bears reasonable resemblance to any product available for consumption as a commercially available candy or that promotes consumption of cannabis; or

(6) contains any seal, flag, crest, coat of arms, or other insignia likely to mislead the purchaser to believe that the product has been endorsed, made, or used by the State of Illinois or any of its representatives, except as authorized by this Act.

(d) All packaged hemp cannabinoid products must contain warning statements established for purchasers, of a size that is legible and readily visible to a consumer inspecting a package, that may not be covered or obscured in any way. The Department of Public Health shall define and update appropriate health warnings for packaging, including specific labeling or warning requirements for specific hemp cannabinoid products.

(e) Unless modified by rule to strengthen or respond to new evidence and science, the following warning applies to all packaged hemp cannabinoid products unless modified by rule: "This product contains cannabinoids and is intended for use by adults 21 and over. Its use can impair cognition and may be habit forming. This product should not be used by pregnant or breastfeeding women. It is illegal to operate a motor vehicle while under the influence of cannabinoids."

(f) Warnings for each of the following product types must be present on labels when offered for sale to a purchaser:

(1) Hemp cannabinoid products for inhalation must contain the following statement: "Smoking is hazardous to your health.".

(2) Hemp cannabinoid products for ingestion must contain the following statement: "CAUTION: This product contains cannabinoids, and intoxication following use may be delayed 2 or more hours. This product was produced in a facility that may also process common food allergens.".

The warnings required under this subsection may be satisfied by means of a QR code linking to a website where the information is available for a consumer.

(505 ILCS 89/13 new)

Sec. 13. Hemp Social Equity Fund.

(a) The General Assembly finds that in order to address the disparities described in this Section, aggressive approaches and targeted technical assistance resources to support social equity entrepreneurs are required. To carry this intent, the Hemp Social Equity Fund is created to directly address the impact of economic disinvestment, violence, and the historical overuse of criminal justice response to community and individual needs by providing resources, funding, and technical assistance for hemp social equity participants to establish, build, and create ownership in hemp business establishments.

(b) There is created in the State treasury a special fund, which shall be held separate and apart from all other State moneys, to be known as the Hemp Social Equity Fund. 25% of all moneys deposited into the Hemp Regulatory Fund shall be transferred into the Hemp Social Equity Fund. The Hemp Social Equity Fund shall be exclusively used for the following purposes:

(1) to provide low-interest rate loans to qualified hemp social equity participants to pay for ordinary and necessary expenses to start and operate a hemp business establishment permitted by this Act;

(2) to provide grants to qualified hemp social equity participants to pay for ordinary and necessary expenses to start and operate a hemp business establishment permitted by this Act;

(3) to compensate the Department of Commerce and Economic Opportunity for any costs related to the provision of low-interest loans and grants to qualified hemp social equity participants;

(4) to pay for education, outreach and technical assistance that may be provided or targeted to attract and support hemp social equity participants; and

(5) to support urban and rural farming, medicinal and food security, and hemp-related criminal justice reform.

(c) Notwithstanding any other provision of law, the Hemp Social Equity Fund is not subject to sweeps, administrative charge-backs, or any other fiscal or budgetary maneuver that would in any way transfer any amounts from the Hemp Social Equity Fund into any other fund of the State.

(d) The Department of Commerce and Economic Opportunity shall establish grant and loan programs, subject to appropriations to the Hemp Social Equity Fund, for the purpose of providing financial assistance, loans, grants and technical assistance to hemp social equity participants.

(e) The Department of Commerce and Economic Opportunity may:

(1) Provide Hemp Social Equity loans and grants from appropriations from the Hemp Social Equity Fund to assist qualified hemp social equity participants in gaining entry to, and successfully operating in, the State's regulated hemp-derived cannabinoid marketplace.

(2) Enter into agreements that set forth terms and conditions of the financial assistance, accept funds or grants, and engage in cooperation with private entities and agencies of State or local government to carry out the purposes of this Section.

(3) Fix, determine, charge and collect any premiums, fees, charges, costs, and expenses, including application fees, commitment fees, program fees, financing charges, or publication fees in connection with its activities under this Section.

(4) Coordinate assistance under these loan programs with activities of the Department of Financial and Professional Regulation, the Department of Agriculture, and other agencies as needed to maximize the effectiveness and efficiency of this Act.

(5) Provide staff and administrative and related support required to administer this Section.

(6) Take whatever actions are necessary or appropriate to protect the State's interest due to bankruptcy, default, foreclosure, or noncompliance with the terms and conditions of financial assistance provided under this Section, including the ability to recapture funds if the recipient is found to be noncompliant with the terms and conditions of the financial assistance agreement.

(7) Establish application, notification, contract, and other forms, procedures or rules deemed necessary and appropriate.

(8) Utilize vendors or contract work to carry out the purposes of this Act.

(f) Loans made under this Section:

(1) shall only be made if, in the Department's judgment, the project furthers the goals set forth in this Act; and

(2) shall be in such principal amount and form and contain such terms and provisions with respect to security, insurance, reporting, delinquency charges, default remedies, and other matters as the Department shall determine appropriate to protect the public interest and to be consistent with the purposes of this Section. The terms and provisions may be less than required for similar loans not covered by this Section.

(g) Grants made under this Section shall be awarded on a competitive and annual basis under the Grant Accountability and Transparency Act. Grants made under this Section shall further and promote the goals of this Act, including promotion of hemp social equity participants, job training and workforce development, and technical assistance to hemp social equity participants.

(h) Beginning January 1, 2025 and each year thereafter, the Department shall annually report to the Governor and the General Assembly on the outcomes and effectiveness of this Section that shall include the following:

(1) the number of persons or businesses receiving financial assistance under this Section;

(2) the amount in financial assistance awarded in the aggregate, in addition to the amount of loans made that are outstanding and the amount of grants awarded;

(3) the location of the project engaged in by the person or business; and

(4) if applicable, the number of new jobs and other forms of economic output created as a result of the financial assistance.

(i) The Department of Commerce and Economic Opportunity shall include engagement with individuals with limited English proficiency as part of its outreach provided or targeted to attract and support hemp social equity participants.

(505 ILCS 89/15)

Sec. 15. Rules.

(a) The Department shall submit to the Secretary of the United States Department of Agriculture a hemp production plan under which the Department monitors and regulates the production of industrial hemp in this State. The Department shall adopt rules incorporating the hemp production plan, including application and licensing requirements.

(b) The rules set by the Department shall include one yearly inspection of a licensed industrial hemp cultivation operation and allow for additional unannounced inspections of a licensed industrial hemp cultivation operation at the Department's discretion.

(c) The Department shall adopt rules necessary for the administration and enforcement of this Act in accordance with all applicable State and federal laws and regulations, including rules concerning standards and criteria for licensure and registration, for the payment of applicable fees, signage, and for forms required for the administration of this Act.

(d) The Department shall adopt rules for the testing of the industrial hemp THC levels and the disposal of plant matter exceeding lawful THC levels, including an option for a cultivator to retest for a minor violation, with the retest threshold determined by the Department and set in rule. Those rules may provide for the use of seed certified to meet the THC levels mandated by this Act as an alternative to testing.

(e) The application form for licenses under this Act shall be determined by the Department and set by rule within 180 days after the effective date of this amendatory Act of the 103rd General Assembly.

(f) The rules adopted by the appropriate regulatory Department may include one yearly inspection of a licensed hemp farm, hemp distribution, hemp processing, hemp food establishment, or hemp retailer and allow for additional unannounced inspections of a licensed hemp business establishment upon good cause.

(g) The Department shall adopt rules necessary for the administration and enforcement of this Act, including rules concerning the payment of applicable fees, signage, and forms required for the administration of this Act. The fee for any hemp business license or renewal shall not exceed $250.

(h) The Department shall adopt rules for the testing of the hemp THC levels and the disposal of plant matter exceeding lawful hemp THC levels, including an option for a cultivator to retest for a minor violation. Those rules must provide for the use of seed certified to meet the hemp THC levels mandated by this Act as an alternative to testing.

(i) The Department shall not limit by rule the quantity of any hemp licenses. The rules shall require the license application process to be open indefinitely and shall require the Department to approve or deny all license applications within 30 calendar days.

(j) The Department shall expressly permit by rule individuals who are disallowed from holding an Illinois hemp license by Section 297B(e)(3)(B)(i) of the Agricultural Marketing Act of 1946 (7 U.S.C. 1939p) to hold a hemp business license, work for a hemp business establishment, and produce Illinois hemp.

(k) If federal rules disallow certain provisions of these rules, such as those for hemp social equity participants or individuals with nonviolent state or federal controlled substance felony convictions within the last 10 years who are prohibited from participating in hemp programs or possessing ownership or controlling management stake in an hemp business establishment, Illinois hemp business establishments may legally produce, process, and distribute Illinois hemp within the State of Illinois if they do not export Illinois hemp.

(Source: P.A. 102-690, eff. 12-17-21.)

(505 ILCS 89/15.5 new)

Sec. 15.5. Publishing information. The Department shall make available to the public complaints about cannabinoid products, information regarding a pending administrative hearing or court case under this Act, and any disciplinary action taken against a cannabinoid product manufacturer, processor, or seller.

(505 ILCS 89/16 new)

Sec. 16. Importing intermediate and finished hemp products into the State of Illinois.

(a) Out-of-state entities that import live hemp products, intermediate hemp products, or hemp cannabinoid products for ingestion or inhalation into the State of Illinois to sell to licensed hemp business establishments must obtain a hemp distributor permit.

(b) Out-of-state entities may not import into the State of Illinois ready-to-eat hemp products or cottage hemp cannabinoid products.

(c) Out-of-state entities may not sell hemp cannabinoid products to end consumers within the State of Illinois unless they obtain a hemp retailer permit and maintain proof of age verification and shipping manifests for a period of 3 years.

(505 ILCS 89/17)

Sec. 17. Administrative hearings.

(a) Administrative hearings involving licensees under this Act shall be conducted under the Department's rules governing formal administrative proceedings.

(b) The following administrative fines may be imposed by the Department upon any person or entity who violates any provision of this Act or any rule adopted by any State department under this Act:

(1) A penalty of $2,500 for a first violation.

(2) A penalty of $5,000 for a second violation at the same location within 2 years of the first violation.

(3) A penalty of $10,000 for a third or subsequent violation at the same location within 2 years of the second or subsequent violation.

Moneys collected by the Department under this Section shall be deposited into the Hemp Regulatory Fund. Any penalty of $5,000 or greater that is not paid within 120 days of issuance of notice from the Department shall be submitted to the Department of Revenue for collection as provided under the Illinois State Collection Act of 1986. The Department may prohibit any person from selling or distributing a hemp cannabinoid product for failure to pay an administrative monetary penalty within 60 days of issuance of notice from the Department.

(c) All final administrative decisions of the Department are subject to judicial review under the Administrative Review Law. The term "administrative decision" has the meaning given to that term in Section 3-101 of the Code of Civil Procedure.

(Source: P.A. 100-1091, eff. 8-26-18.)

(505 ILCS 89/17.5 new)

Sec. 17.5. Temporary restraining order or injunction. The Director, through the Attorney General, may file a complaint and apply to the circuit court for, and the court upon hearing and for cause shown may grant, a temporary restraining order or a preliminary or permanent injunction restraining any person from violating this Act.

(505 ILCS 89/18)

Sec. 18. Industrial Hemp Regulatory Fund. There is created in the State treasury a special fund to be known as the Industrial Hemp Regulatory Fund. All fees and fines collected by the Department under this Act shall be deposited into the Fund. Moneys in the Fund shall be utilized by the Department for the purposes of implementation, administration, and enforcement of this Act.

(Source: P.A. 100-1091, eff. 8-26-18.)

(505 ILCS 89/18.5 new)

Sec. 18.5. Cannabinoid retail tax.

(a) Beginning on July 1, 2024, a tax is imposed upon purchases for hemp cannabinoid products at a rate of 5% of the purchase price of the cannabinoid products.

(b) Live hemp products, raw hemp products, processed hemp products, intermediate hemp products, and cottage hemp cannabinoid products may not be taxed under this Act.

(c) Cannabinoid products sold for research purposes may not be taxed under this Act.

(d) The tax imposed under this Act shall be in addition to all other occupation, privilege, or excise taxes imposed by the State of Illinois or by any municipal corporation or political subdivision thereof.

(e) The tax imposed under this Act may not be imposed on any purchase by a purchaser if the hemp retailer is prohibited by federal or State constitution, treaty, convention, statute, or court decision from collecting the tax from the purchaser.

(f) The tax imposed by this Act shall be collected from the purchaser by the hemp retailer or hemp food establishment and shall be remitted to the Department on or before the 20th day of each month for the preceding calendar month stating the following:

(1) the hemp retailer's or hemp food establishment's name;

(2) the address of the hemp retailer's principal place of business and the address of the principal place of business (if that is a different address) from which the hemp retailer engaged in the business of selling cannabinoid products subject to tax under this Act;

(3) the total purchase price received by the hemp retailer for hemp subject to tax under this Act;

(4) the amount of tax due;

(5) the signature of the hemp retailer; and

(6) any other information as the Department may reasonably require.

(g) All returns required to be filed and payments required to be made under this Act shall be by electronic means.

(h) Any amount that is required to be shown or reported on any return or other document under this Act shall, if the amount is not a whole-dollar amount, be increased to the nearest whole-dollar amount if the fractional part of a dollar is $0.50 or more and decreased to the nearest whole-dollar amount if the fractional part of a dollar is less than $0.50. If a total amount of less than $1 is payable, refundable, or creditable, the amount shall be disregarded if it is less than $0.50 and shall be increased to $1 if it is $0.50 or more.

(i) Any hemp retailer required to collect the tax imposed by this Act shall be liable to the Department for the tax, whether or not the tax has been collected by the hemp retailer, and any such tax shall constitute a debt owed by the hemp retailer to this State. To the extent that a hemp retailer required to collect the tax imposed by this Act has actually collected that tax, the tax is held in trust for the benefit of the Department.

(j) Any hemp retailer who ceases to engage in the kind of business that makes the person responsible for filing returns under this Act shall file a final return under this Act with the Department within one month after discontinuing the business.

(505 ILCS 89/20)

Sec. 20. Hemp products.

(a) Raw hemp products may be sold by any legal business entity within Illinois, may be purchased by any member of the general public, and are not subject to hemp cannabinoid product taxes.

(b) Nothing in this Act shall alter the legality of hemp or hemp products that are held by a person and presently legal to possess or own on the effective date of this amendatory Act of the 103rd General Assembly.

(Source: P.A. 100-1091, eff. 8-26-18.)

(505 ILCS 89/28 new)

Sec. 28. Local ordinances. Unless otherwise provided under this Act or otherwise in accordance with State law:

(1) A unit of local government, including a home rule unit or any non-home rule county within the unincorporated territory of the county, may enact reasonable zoning ordinances or resolutions, not in conflict with this Act or rules adopted pursuant to this Act, regulating hemp business establishments. No unit of local government, including a home rule unit or any non-home rule county within the unincorporated territory of the county, may prohibit home cultivation or consumption of hemp or cannabinoid products authorized by this Act.

(2) A unit of local government, including a home rule unit or any non-home rule county within the unincorporated territory of the county, may enact ordinances or rules not in conflict with this Act or with rules adopted pursuant to this Act governing the time and manner of hemp business establishment operations through the use of conditional use permits. A unit of local government, including a home rule unit, may establish civil penalties for violation of an ordinance or rules governing the time and manner of operation of a hemp business establishment or a conditional use permit in the jurisdiction of the unit of local government. No unit of local government, including a home rule unit or non-home rule county within an unincorporated territory of the county, may unreasonably restrict the time or manner of hemp business establishment operations authorized by this Act. No unit of local government, including a home rule unit or non-home rule county within an unincorporated territory of the county, may restrict the number of hemp business establishment operations authorized by this Act.

(3) 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 enact minimum distance limitations between hemp business establishments and locations it deems sensitive.

(4) A unit of local government, including a home rule unit, or any non-home rule county within the unincorporated territory of the county may authorize or permit the on-premises consumption of cannabinoid products at or in a dispensing organization or retail tobacco store (as defined in Section 10 of the Smoke Free Illinois Act) within its jurisdiction in a manner consistent with this Act. A dispensing organization or retail tobacco store authorized or permitted by a unit of local government to allow on-site consumption shall not be deemed a public place within the meaning of the Smoke Free Illinois Act.

(5) 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 paragraph (1), (2), or (3) in a manner more restrictive than the regulation of those activities by the State under this Act.

(6) 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 enact ordinances to prohibit or significantly limit a hemp business establishment's location.

(505 ILCS 89/30 new)

Sec. 30. Task force; gathering data.

(a) The Director shall establish a task force to publish one or more disparity and availability studies that:

(1) evaluate the risks and benefits of cannabinoids;

(2) evaluate the availability of hemp and cannabis products to minors;

(3) evaluate economic development attributable to hemp and hemp-derived cannabinoids across this State, especially in communities who have been most impacted by the War on Drugs; and

(4) evaluate whether there exists discrimination in this State's hemp industry and, if so, evaluate the impact of this discrimination on the State, and include recommendations to the Department for reducing or eliminating any identified barriers to entry in the hemp market.

The disparity and availability studies shall examine each license type issued pursuant to Sections 10.5, 10.10, and 10.20 and shall be initiated within 180 days from the issuance of the first of each license authorized by those Sections. The report must include the task force's legislative recommendations regarding further cannabinoid research, the use and availability of cannabinoid products and cannabis products among minors, and the impact of cannabinoid products on minority-owned and women-owned business creation. Additionally, the report must contain an analysis of the effectiveness of each recommendation. This analysis will assess the potential impact and outcomes of the proposed legislative measures. The task force shall make rule recommendations as part of the report. The results of each disparity and availability study shall be reported to the General Assembly and the Governor no later than 12 months after the commission of each study.

The Director shall forward a copy of the task force's study and recommendations to the Department of Financial and Professional Regulation, the Department of Agriculture, and the Department of Commerce and Economic Opportunity.

(b) The Department may compile, collect, or otherwise gather data necessary for the administration of this Act and to carry out the Director's duty relating to the recommendation of policy changes. The Department of Agriculture may direct the Department of Financial and Professional Regulation, Department of Public Health, Department of Human Services, and Department of Commerce and Economic Opportunity to assist in the compilation, collection, and data gathering authorized under this subsection. The Director shall compile all of the data into a single report and submit the report to the Governor and the General Assembly and publish the report on its website.

(c) If the Director may use a third party to complete the responsibilities of subsection (a), subsection (b), or both. If the Director elects to use a third party to complete any element of this Section, preference shall be given to entities with experience in increasing diversity in the hemp or cannabis industry and making policy recommendations to the General Assembly.

(505 ILCS 89/800 new)

Sec. 800. Home rule preemption. Except as otherwise provided in this Act, the regulation and permitting of the activities described in this Act are exclusive powers and functions of the State. Except as otherwise provided in this Act, a unit of local government, including a home rule unit, may not regulate or license the activities described in this Act. This Act is a denial and limitation of home rule powers and functions under subsection (h) of Section 6 of Article VII of the Illinois Constitution.

(505 ILCS 89/10 rep.)

Section 35. The Industrial Hemp Act is amended by repealing Section 10.

Section 40. The Illinois Noxious Weed Law is amended by changing Section 2 as follows:

(505 ILCS 100/2) (from Ch. 5, par. 952)

Sec. 2. As used in this Act:

(1) "Person" means any individual, partnership, firm, corporation, company, society, association, the State or any department, agency, or subdivision thereof, or any other entity.

(2) "Control", "controlled" or "controlling" includes being in charge of or being in possession, whether as owner, lessee, renter, or tenant, under statutory authority, or otherwise.

(3) "Director" means the Director of the Department of Agriculture of the State of Illinois, or his or her duly appointed representative.

(4) "Department" means the Department of Agriculture of the State of Illinois.

(5) "Noxious weed" means any plant which is determined by the Director, the Dean of the College of Agricultural, Consumer and Environmental Sciences of the University of Illinois and the Director of the Agricultural Experiment Station at the University of Illinois, to be injurious to public health, crops, livestock, land or other property. "Noxious weed" does not include industrial hemp as defined and authorized under the Industrial Hemp Act.

(6) "Control Authority" means the governing body of each county, and shall represent all rural areas and cities, villages and townships within the county boundaries.

(7) "Applicable fund" means the fund current at the time the work is performed or the money is received.

(Source: P.A. 99-539, eff. 7-8-16; 100-1091, eff. 8-26-18.)

Section 45. The Cannabis Control Act is amended by changing Sections 4, 5, 5.1, and 8 as follows:

(720 ILCS 550/4) (from Ch. 56 1/2, par. 704)

Sec. 4. Except as otherwise provided in the Cannabis Regulation and Tax Act and the Industrial Hemp Act, it is unlawful for any person knowingly to possess cannabis.

Any person who violates this Section with respect to:

(a) not more than 10 grams of any substance containing cannabis is guilty of a civil law violation punishable by a minimum fine of $100 and a maximum fine of $200. The proceeds of the fine shall be payable to the clerk of the circuit court. Within 30 days after the deposit of the fine, the clerk shall distribute the proceeds of the fine as follows:

(1) $10 of the fine to the circuit clerk and $10 of the fine to the law enforcement agency that issued the citation; the proceeds of each $10 fine distributed to the circuit clerk and each $10 fine distributed to the law enforcement agency that issued the citation for the violation shall be used to defer the cost of automatic expungements under paragraph (2.5) of subsection (a) of Section 5.2 of the Criminal Identification Act;

(2) $15 to the county to fund drug addiction services;

(3) $10 to the Office of the State's Attorneys Appellate Prosecutor for use in training programs;

(4) $10 to the State's Attorney; and

(5) any remainder of the fine to the law enforcement agency that issued the citation for the violation.

With respect to funds designated for the Illinois State Police, the moneys shall be remitted by the circuit court clerk to the Illinois State Police within one month after receipt for deposit into the State Police Operations Assistance Fund. With respect to funds designated for the Department of Natural Resources, the Department of Natural Resources shall deposit the moneys into the Conservation Police Operations Assistance Fund;

(b) more than 10 grams but not more than 30 grams of any substance containing cannabis is guilty of a Class B misdemeanor;

(c) more than 30 grams but not more than 100 grams of any substance containing cannabis is guilty of a Class A misdemeanor; provided, that if any offense under this subsection (c) is a subsequent offense, the offender shall be guilty of a Class 4 felony;

(d) more than 100 grams but not more than 500 grams of any substance containing cannabis is guilty of a Class 4 felony; provided that if any offense under this subsection (d) is a subsequent offense, the offender shall be guilty of a Class 3 felony;

(e) more than 500 grams but not more than 2,000 grams of any substance containing cannabis is guilty of a Class 3 felony;

(f) more than 2,000 grams but not more than 5,000 grams of any substance containing cannabis is guilty of a Class 2 felony;

(g) more than 5,000 grams of any substance containing cannabis is guilty of a Class 1 felony.

(Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19; 102-538, eff. 8-20-21.)

(720 ILCS 550/5) (from Ch. 56 1/2, par. 705)

Sec. 5. Except as otherwise provided in the Cannabis Regulation and Tax Act and the Industrial Hemp Act, it is unlawful for any person knowingly to manufacture, deliver, or possess with intent to deliver, or manufacture, cannabis. Any person who violates this Section with respect to:

(a) not more than 2.5 grams of any substance containing cannabis is guilty of a Class B misdemeanor;

(b) more than 2.5 grams but not more than 10 grams of any substance containing cannabis is guilty of a Class A misdemeanor;

(c) more than 10 grams but not more than 30 grams of any substance containing cannabis is guilty of a Class 4 felony;

(d) more than 30 grams but not more than 500 grams of any substance containing cannabis is guilty of a Class 3 felony for which a fine not to exceed $50,000 may be imposed;

(e) more than 500 grams but not more than 2,000 grams of any substance containing cannabis is guilty of a Class 2 felony for which a fine not to exceed $100,000 may be imposed;

(f) more than 2,000 grams but not more than 5,000 grams of any substance containing cannabis is guilty of a Class 1 felony for which a fine not to exceed $150,000 may be imposed;

(g) more than 5,000 grams of any substance containing cannabis is guilty of a Class X felony for which a fine not to exceed $200,000 may be imposed.

(Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19.)

(720 ILCS 550/5.1) (from Ch. 56 1/2, par. 705.1)

Sec. 5.1. Cannabis trafficking.

(a) Except for purposes authorized by this Act, the Industrial Hemp Act, or the Cannabis Regulation and Tax Act, any person who knowingly brings or causes to be brought into this State for the purpose of manufacture or delivery or with the intent to manufacture or deliver 2,500 grams or more of cannabis in this State or any other state or country is guilty of cannabis trafficking.

(b) A person convicted of cannabis trafficking shall be sentenced to a term of imprisonment not less than twice the minimum term and fined an amount as authorized by subsection (f) or (g) of Section 5 of this Act, based upon the amount of cannabis brought or caused to be brought into this State, and not more than twice the maximum term of imprisonment and fined twice the amount as authorized by subsection (f) or (g) of Section 5 of this Act, based upon the amount of cannabis brought or caused to be brought into this State.

(Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19.)

(720 ILCS 550/8) (from Ch. 56 1/2, par. 708)

Sec. 8. Except as otherwise provided in the Cannabis Regulation and Tax Act and the Industrial Hemp Act, it is unlawful for any person knowingly to produce the Cannabis sativa plant or to possess such plants unless production or possession has been authorized pursuant to the provisions of Section 11 or 15.2 of the Act. Any person who violates this Section with respect to production or possession of:

(a) Not more than 5 plants is guilty of a civil violation punishable by a minimum fine of $100 and a maximum fine of $200. The proceeds of the fine are payable to the clerk of the circuit court. Within 30 days after the deposit of the fine, the clerk shall distribute the proceeds of the fine as follows:

(1) $10 of the fine to the circuit clerk and $10 of the fine to the law enforcement agency that issued the citation; the proceeds of each $10 fine distributed to the circuit clerk and each $10 fine distributed to the law enforcement agency that issued the citation for the violation shall be used to defer the cost of automatic expungements under paragraph (2.5) of subsection (a) of Section 5.2 of the Criminal Identification Act;

(2) $15 to the county to fund drug addiction services;

(3) $10 to the Office of the State's Attorneys Appellate Prosecutor for use in training programs;

(4) $10 to the State's Attorney; and

(5) any remainder of the fine to the law enforcement agency that issued the citation for the violation.

With respect to funds designated for the Illinois State Police, the moneys shall be remitted by the circuit court clerk to the State Treasurer within one month after receipt for deposit into the State Police Operations Assistance Fund. With respect to funds designated for the Department of Natural Resources, the Department of Natural Resources shall deposit the moneys into the Conservation Police Operations Assistance Fund.

(b) More than 5, but not more than 20 plants, is guilty of a Class 4 felony.

(c) More than 20, but not more than 50 plants, is guilty of a Class 3 felony.

(d) More than 50, but not more than 200 plants, is guilty of a Class 2 felony for which a fine not to exceed $100,000 may be imposed and for which liability for the cost of conducting the investigation and eradicating such plants may be assessed. Compensation for expenses incurred in the enforcement of this provision shall be transmitted to and deposited in the treasurer's office at the level of government represented by the Illinois law enforcement agency whose officers or employees conducted the investigation or caused the arrest or arrests leading to the prosecution, to be subsequently made available to that law enforcement agency as expendable receipts for use in the enforcement of laws regulating controlled substances and cannabis. If such seizure was made by a combination of law enforcement personnel representing different levels of government, the court levying the assessment shall determine the allocation of such assessment. The proceeds of assessment awarded to the State treasury shall be deposited in a special fund known as the Drug Traffic Prevention Fund.

(e) More than 200 plants is guilty of a Class 1 felony for which a fine not to exceed $100,000 may be imposed and for which liability for the cost of conducting the investigation and eradicating such plants may be assessed. Compensation for expenses incurred in the enforcement of this provision shall be transmitted to and deposited in the treasurer's office at the level of government represented by the Illinois law enforcement agency whose officers or employees conducted the investigation or caused the arrest or arrests leading to the prosecution, to be subsequently made available to that law enforcement agency as expendable receipts for use in the enforcement of laws regulating controlled substances and cannabis. If such seizure was made by a combination of law enforcement personnel representing different levels of government, the court levying the assessment shall determine the allocation of such assessment. The proceeds of assessment awarded to the State treasury shall be deposited in a special fund known as the Drug Traffic Prevention Fund.

(Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19; 102-145, eff. 7-23-21; 102-538, eff. 8-20-21; 102-813, eff. 5-13-22.)

Section 50. The State Finance Act is amended by changing Section 5.890 and adding Section 5.1015 as follows:

(30 ILCS 105/5.890)

Sec. 5.890. The Industrial Hemp Regulatory Fund.

(Source: P.A. 100-1091, eff. 8-26-18; 101-81, eff. 7-12-19.)

(30 ILCS 105/5.1015 new)

Sec. 5.1015. The Hemp Social Equity Fund.

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