SB1712 EngrossedLRB097 09992 RLJ 50162 b

1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Innovation Development and Economy Act is
5amended by changing Section 10 as follows:
 
6    (50 ILCS 470/10)
7    Sec. 10. Definitions. As used in this Act, the following
8words and phrases shall have the following meanings unless a
9different meaning clearly appears from the context:
10    "Base year" means the calendar year immediately prior to
11the calendar year in which the STAR bond district is
12established.
13    "Commence work" means the manifest commencement of actual
14operations on the development site, such as, erecting a
15building, general on-site and off-site grading and utility
16installations, commencing design and construction
17documentation, ordering lead-time materials, excavating the
18ground to lay a foundation or a basement, or work of like
19description which a reasonable person would recognize as being
20done with the intention and purpose to continue work until the
21project is completed.
22    "County" means the county in which a proposed STAR bond
23district is located.

 

 

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1    "De minimus" means an amount less than 15% of the land area
2within a STAR bond district.
3    "Department of Revenue" means the Department of Revenue of
4the State of Illinois.
5    "Destination user" means an owner, operator, licensee,
6co-developer, subdeveloper, or tenant (i) that operates a
7business within a STAR bond district that is a retail store
8having at least 150,000 square feet of sales floor area; (ii)
9that at the time of opening does not have another Illinois
10location within a 70 mile radius; (iii) that has an annual
11average of not less than 30% of customers who travel from at
12least 75 miles away or from out-of-state, as demonstrated by
13data from a comparable existing store or stores, or, if there
14is no comparable existing store, as demonstrated by an economic
15analysis that shows that the proposed retailer will have an
16annual average of not less than 30% of customers who travel
17from at least 75 miles away or from out-of-state; and (iv) that
18makes an initial capital investment, including project costs
19and other direct costs, of not less than $30,000,000 for such
20retail store.
21    "Destination hotel" means a hotel (as that term is defined
22in Section 2 of the Hotel Operators' Occupation Tax Act)
23complex having at least 150 guest rooms and which also includes
24a venue for entertainment attractions, rides, or other
25activities oriented toward the entertainment and amusement of
26its guests and other patrons.

 

 

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1    "Developer" means any individual, corporation, trust,
2estate, partnership, limited liability partnership, limited
3liability company, or other entity. The term does not include a
4not-for-profit entity, political subdivision, or other agency
5or instrumentality of the State.
6    "Director" means the Director of Revenue, who shall consult
7with the Director of Commerce and Economic Opportunity in any
8approvals or decisions required by the Director under this Act.
9    "Economic impact study" means a study conducted by an
10independent economist to project the financial benefit of the
11proposed STAR bond project to the local, regional, and State
12economies, consider the proposed adverse impacts on similar
13projects and businesses, as well as municipalities within the
14projected market area, and draw conclusions about the net
15effect of the proposed STAR bond project on the local,
16regional, and State economies. A copy of the economic impact
17study shall be provided to the Director for review.
18    "Eligible area" means any improved or vacant area that (i)
19is contiguous and is not, in the aggregate, less than 250 acres
20nor more than 500 acres which must include only parcels of real
21property directly and substantially benefited by the proposed
22STAR bond district plan, (ii) is adjacent to a federal
23interstate highway, (iii) is within one mile of 2 State
24highways, (iv) is within one mile of an entertainment user, or
25a major or minor league sports stadium or other similar
26entertainment venue that had an initial capital investment of

 

 

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1at least $20,000,000, and (v) includes land that was previously
2surface or strip mined. The area may be bisected by streets,
3highways, roads, alleys, railways, bike paths, streams,
4rivers, and other waterways and still be deemed contiguous. In
5addition, in order to constitute an eligible area one of the
6following requirements must be satisfied and all of which are
7subject to the review and approval of the Director as provided
8in subsection (d) of Section 15:
9        (a) the governing body of the political subdivision
10    shall have determined that the area meets the requirements
11    of a "blighted area" as defined under the Tax Increment
12    Allocation Redevelopment Act; or
13        (b) the governing body of the political subdivision
14    shall have determined that the area is a blighted area as
15    determined under the provisions of Section 11-74.3-5 of the
16    Illinois Municipal Code; or
17        (c) the governing body of the political subdivision
18    shall make the following findings:
19            (i) that the vacant portions of the area have
20        remained vacant for at least one year, or that any
21        building located on a vacant portion of the property
22        was demolished within the last year and that the
23        building would have qualified under item (ii) of this
24        subsection;
25            (ii) if portions of the area are currently
26        developed, that the use, condition, and character of

 

 

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1        the buildings on the property are not consistent with
2        the purposes set forth in Section 5;
3            (iii) that the STAR bond district is expected to
4        create or retain job opportunities within the
5        political subdivision;
6            (iv) that the STAR bond district will serve to
7        further the development of adjacent areas;
8            (v) that without the availability of STAR bonds,
9        the projects described in the STAR bond district plan
10        would not be possible;
11            (vi) that the master developer meets high
12        standards of creditworthiness and financial strength
13        as demonstrated by one or more of the following: (i)
14        corporate debenture ratings of BBB or higher by
15        Standard & Poor's Corporation or Baa or higher by
16        Moody's Investors Service, Inc.; (ii) a letter from a
17        financial institution with assets of $10,000,000 or
18        more attesting to the financial strength of the master
19        developer; or (iii) specific evidence of equity
20        financing for not less than 10% of the estimated total
21        STAR bond project costs;
22            (vii) that the STAR bond district will strengthen
23        the commercial sector of the political subdivision;
24            (viii) that the STAR bond district will enhance the
25        tax base of the political subdivision; and
26            (ix) that the formation of a STAR bond district is

 

 

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1        in the best interest of the political subdivision.
2    "Entertainment user" means an owner, operator, licensee,
3co-developer, subdeveloper, or tenant that operates a business
4within a STAR bond district that has a primary use of providing
5a venue for entertainment attractions, rides, or other
6activities oriented toward the entertainment and amusement of
7its patrons, occupies at least 20 acres of land in the STAR
8bond district, and makes an initial capital investment,
9including project costs and other direct and indirect costs, of
10not less than $25,000,000 for that venue.
11    "Feasibility study" means a feasibility study as defined in
12subsection (b) of Section 20.
13    "Infrastructure" means the public improvements and private
14improvements that serve the public purposes set forth in
15Section 5 of this Act and that benefit the STAR bond district
16or any STAR bond projects, including, but not limited to,
17streets, drives and driveways, traffic and directional signs
18and signals, parking lots and parking facilities,
19interchanges, highways, sidewalks, bridges, underpasses and
20overpasses, bike and walking trails, sanitary storm sewers and
21lift stations, drainage conduits, channels, levees, canals,
22storm water detention and retention facilities, utilities and
23utility connections, water mains and extensions, and street and
24parking lot lighting and connections.
25    "Local sales taxes" means any locally imposed taxes
26received by a municipality, county, or other local governmental

 

 

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1entity arising from sales by retailers and servicemen within a
2STAR bond district, including business district sales taxes and
3STAR bond occupation taxes, and that portion of the net revenue
4realized under the Retailers' Occupation Tax Act, the Use Tax
5Act, the Service Use Tax Act, and the Service Occupation Tax
6Act from transactions at places of business located within a
7STAR bond district that is deposited into the Local Government
8Tax Fund and the County and Mass Transit District Fund. For the
9purpose of this Act, "local sales taxes" does not include (i)
10any taxes authorized pursuant to the Local Mass Transit
11District Act or , the Metro-East Park and Recreation District
12Act, or the Flood Prevention District Act for so long as the
13applicable taxing district does not impose a tax on real
14property, or (ii) county school facility occupation taxes
15imposed pursuant to Section 5-1006.7 of the Counties Code, or
16(iii) any taxes authorized under the Flood Prevention District
17Act.
18    "Local sales tax increment" means, with respect to local
19sales taxes administered by the Illinois Department of Revenue,
20(i) all of the local sales tax paid by destination users,
21destination hotels, and entertainment users that is in excess
22of the local sales tax paid by destination users, destination
23hotels, and entertainment users for the same month in the base
24year, as determined by the Illinois Department of Revenue, (ii)
25in the case of a municipality forming a STAR bond district that
26is wholly within the corporate boundaries of the municipality

 

 

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1and in the case of a municipality and county forming a STAR
2bond district that is only partially within such municipality,
3that portion of the local sales tax paid by taxpayers that are
4not destination users, destination hotels, or entertainment
5users that is in excess of the local sales tax paid by
6taxpayers that are not destination users, destination hotels,
7or entertainment users for the same month in the base year, as
8determined by the Illinois Department of Revenue, and (iii) in
9the case of a county in which a STAR bond district is formed
10that is wholly within a municipality, that portion of the local
11sales tax paid by taxpayers that are not destination users,
12destination hotels, or entertainment users that is in excess of
13the local sales tax paid by taxpayers that are not destination
14users, destination hotels, or entertainment users for the same
15month in the base year, as determined by the Illinois
16Department of Revenue, but only if the corporate authorities of
17the county adopts an ordinance, and files a copy with the
18Department within the same time frames as required for STAR
19bond occupation taxes under Section 31, that designates the
20taxes referenced in this clause (iii) as part of the local
21sales tax increment under this Act. "Local sales tax increment"
22means, with respect to local sales taxes administered by a
23municipality, county, or other unit of local government, that
24portion of the local sales tax that is in excess of the local
25sales tax for the same month in the base year, as determined by
26the respective municipality, county, or other unit of local

 

 

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1government. If any portion of local sales taxes are, at the
2time of formation of a STAR bond district, already subject to
3tax increment financing under the Tax Increment Allocation
4Redevelopment Act, then the local sales tax increment for such
5portion shall be frozen at the base year established in
6accordance with this Act, and all future incremental increases
7shall be included in the "local sales tax increment" under this
8Act. Any party otherwise entitled to receipt of incremental
9local sales tax revenues through an existing tax increment
10financing district shall be entitled to continue to receive
11such revenues up to the amount frozen in the base year. Nothing
12in this Act shall affect the prior qualification of existing
13redevelopment project costs incurred that are eligible for
14reimbursement under the Tax Increment Allocation Redevelopment
15Act. In such event, prior to approving a STAR bond district,
16the political subdivision forming the STAR bond district shall
17take such action as is necessary, including amending the
18existing tax increment financing district redevelopment plan,
19to carry out the provisions of this Act. The Illinois
20Department of Revenue shall allocate the local sales tax
21increment only if the local sales tax is administered by the
22Department.
23    "Market study" means a study to determine the ability of
24the proposed STAR bond project to gain market share locally and
25regionally and to remain profitable past the term of repayment
26of STAR bonds.

 

 

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1    "Master developer" means a developer cooperating with a
2political subdivision to plan, develop, and implement a STAR
3bond project plan for a STAR bond district. Subject to the
4limitations of Section 25, the master developer may work with
5and transfer certain development rights to other developers for
6the purpose of implementing STAR bond project plans and
7achieving the purposes of this Act. A master developer for a
8STAR bond district shall be appointed by a political
9subdivision in the resolution establishing the STAR bond
10district, and the master developer must, at the time of
11appointment, own or have control of, through purchase
12agreements, option contracts, or other means, not less than 50%
13of the acreage within the STAR bond district and the master
14developer or its affiliate must have ownership or control on
15June 1, 2010.
16    "Master development agreement" means an agreement between
17the master developer and the political subdivision to govern a
18STAR bond district and any STAR bond projects.
19    "Municipality" means the city, village, or incorporated
20town in which a proposed STAR bond district is located.
21    "Pledged STAR revenues" means those sales tax and revenues
22and other sources of funds pledged to pay debt service on STAR
23bonds or to pay project costs pursuant to Section 30.
24Notwithstanding any provision to the contrary, the following
25revenues shall not constitute pledged STAR revenues or be
26available to pay principal and interest on STAR bonds: any

 

 

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1State sales tax increment or local sales tax increment from a
2retail entity initiating operations in a STAR bond district
3while terminating operations at another Illinois location
4within 25 miles of the STAR bond district. For purposes of this
5paragraph, "terminating operations" means a closing of a retail
6operation that is directly related to the opening of the same
7operation or like retail entity owned or operated by more than
850% of the original ownership in a STAR bond district within
9one year before or after initiating operations in the STAR bond
10district, but it does not mean closing an operation for reasons
11beyond the control of the retail entity, as documented by the
12retail entity, subject to a reasonable finding by the
13municipality (or county if such retail operation is not located
14within a municipality) in which the terminated operations were
15located that the closed location contained inadequate space,
16had become economically obsolete, or was no longer a viable
17location for the retailer or serviceman.
18    "Political subdivision" means a municipality or county
19which undertakes to establish a STAR bond district pursuant to
20the provisions of this Act.
21    "Project costs" means and includes the sum total of all
22costs incurred or estimated to be incurred on or following the
23date of establishment of a STAR bond district that are
24reasonable or necessary to implement a STAR bond district plan
25or any STAR bond project plans, or both, including costs
26incurred for public improvements and private improvements that

 

 

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1serve the public purposes set forth in Section 5 of this Act.
2Such costs include without limitation the following:
3        (a) costs of studies, surveys, development of plans and
4    specifications, formation, implementation, and
5    administration of a STAR bond district, STAR bond district
6    plan, any STAR bond projects, or any STAR bond project
7    plans, including, but not limited to, staff and
8    professional service costs for architectural, engineering,
9    legal, financial, planning, or other services, provided
10    however that no charges for professional services may be
11    based on a percentage of the tax increment collected and no
12    contracts for professional services, excluding
13    architectural and engineering services, may be entered
14    into if the terms of the contract extend beyond a period of
15    3 years;
16        (b) property assembly costs, including, but not
17    limited to, acquisition of land and other real property or
18    rights or interests therein, located within the boundaries
19    of a STAR bond district, demolition of buildings, site
20    preparation, site improvements that serve as an engineered
21    barrier addressing ground level or below ground
22    environmental contamination, including, but not limited
23    to, parking lots and other concrete or asphalt barriers,
24    the clearing and grading of land, and importing additional
25    soil and fill materials, or removal of soil and fill
26    materials from the site;

 

 

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1        (c) subject to paragraph (d), costs of buildings and
2    other vertical improvements that are located within the
3    boundaries of a STAR bond district and owned by a political
4    subdivision or other public entity, including without
5    limitation police and fire stations, educational
6    facilities, and public restrooms and rest areas;
7        (c-1) costs of buildings and other vertical
8    improvements that are located within the boundaries of a
9    STAR bond district and owned by a destination user or
10    destination hotel; except that only 2 destination users in
11    a STAR bond district and one destination hotel are eligible
12    to include the cost of those vertical improvements as
13    project costs;
14        (c-5) costs of buildings; rides and attractions, which
15    include carousels, slides, roller coasters, displays,
16    models, towers, works of art, and similar theme and
17    amusement park improvements; and other vertical
18    improvements that are located within the boundaries of a
19    STAR bond district and owned by an entertainment user;
20    except that only one entertainment user in a STAR bond
21    district is eligible to include the cost of those vertical
22    improvements as project costs;
23        (d) costs of the design and construction of
24    infrastructure and public works located within the
25    boundaries of a STAR bond district that are reasonable or
26    necessary to implement a STAR bond district plan or any

 

 

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1    STAR bond project plans, or both, except that project costs
2    shall not include the cost of constructing a new municipal
3    public building principally used to provide offices,
4    storage space, or conference facilities or vehicle
5    storage, maintenance, or repair for administrative, public
6    safety, or public works personnel and that is not intended
7    to replace an existing public building unless the political
8    subdivision makes a reasonable determination in a STAR bond
9    district plan or any STAR bond project plans, supported by
10    information that provides the basis for that
11    determination, that the new municipal building is required
12    to meet an increase in the need for public safety purposes
13    anticipated to result from the implementation of the STAR
14    bond district plan or any STAR bond project plans;
15        (e) costs of the design and construction of the
16    following improvements located outside the boundaries of a
17    STAR bond district, provided that the costs are essential
18    to further the purpose and development of a STAR bond
19    district plan and either (i) part of and connected to
20    sewer, water, or utility service lines that physically
21    connect to the STAR bond district or (ii) significant
22    improvements for adjacent offsite highways, streets,
23    roadways, and interchanges that are approved by the
24    Illinois Department of Transportation. No other cost of
25    infrastructure and public works improvements located
26    outside the boundaries of a STAR bond district may be

 

 

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1    deemed project costs;
2        (f) costs of job training and retraining projects,
3    including the cost of "welfare to work" programs
4    implemented by businesses located within a STAR bond
5    district;
6        (g) financing costs, including, but not limited to, all
7    necessary and incidental expenses related to the issuance
8    of obligations and which may include payment of interest on
9    any obligations issued hereunder including interest
10    accruing during the estimated period of construction of any
11    improvements in a STAR bond district or any STAR bond
12    projects for which such obligations are issued and for not
13    exceeding 36 months thereafter and including reasonable
14    reserves related thereto;
15        (h) to the extent the political subdivision by written
16    agreement accepts and approves the same, all or a portion
17    of a taxing district's capital costs resulting from a STAR
18    bond district or STAR bond projects necessarily incurred or
19    to be incurred within a taxing district in furtherance of
20    the objectives of a STAR bond district plan or STAR bond
21    project plans;
22        (i) interest cost incurred by a developer for project
23    costs related to the acquisition, formation,
24    implementation, development, construction, and
25    administration of a STAR bond district, STAR bond district
26    plan, STAR bond projects, or any STAR bond project plans

 

 

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1    provided that:
2            (i) payment of such costs in any one year may not
3        exceed 30% of the annual interest costs incurred by the
4        developer with regard to the STAR bond district or any
5        STAR bond projects during that year; and
6            (ii) the total of such interest payments paid
7        pursuant to this Act may not exceed 30% of the total
8        cost paid or incurred by the developer for a STAR bond
9        district or STAR bond projects, plus project costs,
10        excluding any property assembly costs incurred by a
11        political subdivision pursuant to this Act;
12        (j) costs of common areas located within the boundaries
13    of a STAR bond district;
14        (k) costs of landscaping and plantings, retaining
15    walls and fences, man-made lakes and ponds, shelters,
16    benches, lighting, and similar amenities located within
17    the boundaries of a STAR bond district;
18        (l) costs of mounted building signs, site monument, and
19    pylon signs located within the boundaries of a STAR bond
20    district; or
21        (m) if included in the STAR bond district plan and
22    approved in writing by the Director, salaries or a portion
23    of salaries for local government employees to the extent
24    the same are directly attributable to the work of such
25    employees on the establishment and management of a STAR
26    bond district or any STAR bond projects.

 

 

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1    Except as specified in items (a) through (m), "project
2costs" shall not include:
3        (i) the cost of construction of buildings that are
4    privately owned or owned by a municipality and leased to a
5    developer or retail user for non-entertainment retail
6    uses;
7        (ii) moving expenses for employees of the businesses
8    locating within the STAR bond district;
9        (iii) property taxes for property located in the STAR
10    bond district;
11        (iv) lobbying costs; and
12        (v) general overhead or administrative costs of the
13    political subdivision that would still have been incurred
14    by the political subdivision if the political subdivision
15    had not established a STAR bond district.
16    "Project development agreement" means any one or more
17agreements, including any amendments thereto, between a master
18developer and any co-developer or subdeveloper in connection
19with a STAR bond project, which project development agreement
20may include the political subdivision as a party.
21    "Projected market area" means any area within the State in
22which a STAR bond district or STAR bond project is projected to
23have a significant fiscal or market impact as determined by the
24Director.
25    "Resolution" means a resolution, order, ordinance, or
26other appropriate form of legislative action of a political

 

 

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1subdivision or other applicable public entity approved by a
2vote of a majority of a quorum at a meeting of the governing
3body of the political subdivision or applicable public entity.
4    "STAR bond" means a sales tax and revenue bond, note, or
5other obligation payable from pledged STAR revenues and issued
6by a political subdivision, the proceeds of which shall be used
7only to pay project costs as defined in this Act.
8    "STAR bond district" means the specific area declared to be
9an eligible area as determined by the political subdivision,
10and approved by the Director, in which the political
11subdivision may develop one or more STAR bond projects.
12    "STAR bond district plan" means the preliminary or
13conceptual plan that generally identifies the proposed STAR
14bond project areas and identifies in a general manner the
15buildings, facilities, and improvements to be constructed or
16improved in each STAR bond project area.
17    "STAR bond project" means a project within a STAR bond
18district which is approved pursuant to Section 20.
19    "STAR bond project area" means the geographic area within a
20STAR bond district in which there may be one or more STAR bond
21projects.
22    "STAR bond project plan" means the written plan adopted by
23a political subdivision for the development of a STAR bond
24project in a STAR bond district; the plan may include, but is
25not limited to, (i) project costs incurred prior to the date of
26the STAR bond project plan and estimated future STAR bond

 

 

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1project costs, (ii) proposed sources of funds to pay those
2costs, (iii) the nature and estimated term of any obligations
3to be issued by the political subdivision to pay those costs,
4(iv) the most recent equalized assessed valuation of the STAR
5bond project area, (v) an estimate of the equalized assessed
6valuation of the STAR bond district or applicable project area
7after completion of a STAR bond project, (vi) a general
8description of the types of any known or proposed developers,
9users, or tenants of the STAR bond project or projects included
10in the plan, (vii) a general description of the type,
11structure, and character of the property or facilities to be
12developed or improved, (viii) a description of the general land
13uses to apply to the STAR bond project, and (ix) a general
14description or an estimate of the type, class, and number of
15employees to be employed in the operation of the STAR bond
16project.
17    "State sales tax" means all of the net revenue realized
18under the Retailers' Occupation Tax Act, the Use Tax Act, the
19Service Use Tax Act, and the Service Occupation Tax Act from
20transactions at places of business located within a STAR bond
21district, excluding that portion of the net revenue realized
22under the Retailers' Occupation Tax Act, the Use Tax Act, the
23Service Use Tax Act, and the Service Occupation Tax Act from
24transactions at places of business located within a STAR bond
25district that is deposited into the Local Government Tax Fund
26and the County and Mass Transit District Fund.

 

 

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1    "State sales tax increment" means (i) 100% of that portion
2of the State sales tax that is in excess of the State sales tax
3for the same month in the base year, as determined by the
4Department of Revenue, from transactions at up to 2 destination
5users, one destination hotel, and one entertainment user
6located within a STAR bond district, which destination users,
7destination hotel, and entertainment user shall be designated
8by the master developer and approved by the political
9subdivision and the Director in conjunction with the applicable
10STAR bond project approval, and (ii) 25% of that portion of the
11State sales tax that is in excess of the State sales tax for
12the same month in the base year, as determined by the
13Department of Revenue, from all other transactions within a
14STAR bond district. If any portion of State sales taxes are, at
15the time of formation of a STAR bond district, already subject
16to tax increment financing under the Tax Increment Allocation
17Redevelopment Act, then the State sales tax increment for such
18portion shall be frozen at the base year established in
19accordance with this Act, and all future incremental increases
20shall be included in the State sales tax increment under this
21Act. Any party otherwise entitled to receipt of incremental
22State sales tax revenues through an existing tax increment
23financing district shall be entitled to continue to receive
24such revenues up to the amount frozen in the base year. Nothing
25in this Act shall affect the prior qualification of existing
26redevelopment project costs incurred that are eligible for

 

 

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1reimbursement under the Tax Increment Allocation Redevelopment
2Act. In such event, prior to approving a STAR bond district,
3the political subdivision forming the STAR bond district shall
4take such action as is necessary, including amending the
5existing tax increment financing district redevelopment plan,
6to carry out the provisions of this Act.
7    "Substantial change" means a change wherein the proposed
8STAR bond project plan differs substantially in size, scope, or
9use from the approved STAR bond district plan or STAR bond
10project plan.
11    "Taxpayer" means an individual, partnership, corporation,
12limited liability company, trust, estate, or other entity that
13is subject to the Illinois Income Tax Act.
14    "Total development costs" means the aggregate public and
15private investment in a STAR bond district, including project
16costs and other direct and indirect costs related to the
17development of the STAR bond district.
18    "Traditional retail use" means the operation of a business
19that derives at least 90% of its annual gross revenue from
20sales at retail, as that phrase is defined by Section 1 of the
21Retailers' Occupation Tax Act, but does not include the
22operations of destination users, entertainment users,
23restaurants, hotels, retail uses within hotels, or any other
24non-retail uses.
25    "Vacant" means that portion of the land in a proposed STAR
26bond district that is not occupied by a building, facility, or

 

 

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1other vertical improvement.
2(Source: P.A. 96-939, eff. 6-24-10.)
 
3    Section 10. The Flood Prevention District Act is amended by
4changing Section 25 as follows:
 
5    (70 ILCS 750/25)
6    Sec. 25. Flood prevention retailers' and service
7occupation taxes.
8    (a) If the Board of Commissioners of a flood prevention
9district determines that an emergency situation exists
10regarding levee repair or flood prevention, and upon an
11ordinance confirming the determination adopted by the
12affirmative vote of a majority of the members of the county
13board of the county in which the district is situated, the
14county may impose a flood prevention retailers' occupation tax
15upon all persons engaged in the business of selling tangible
16personal property at retail within the territory of the
17district to provide revenue to pay the costs of providing
18emergency levee repair and flood prevention and to secure the
19payment of bonds, notes, and other evidences of indebtedness
20issued under this Act for a period not to exceed 25 years or as
21required to repay the bonds, notes, and other evidences of
22indebtedness issued under this Act. The tax rate shall be 0.25%
23of the gross receipts from all taxable sales made in the course
24of that business. The tax imposed under this Section and all

 

 

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1civil penalties that may be assessed as an incident thereof
2shall be collected and enforced by the State Department of
3Revenue. The Department shall have full power to administer and
4enforce this Section; to collect all taxes and penalties so
5collected in the manner hereinafter provided; and to determine
6all rights to credit memoranda arising on account of the
7erroneous payment of tax or penalty hereunder.
8    In the administration of and compliance with this
9subsection, the Department and persons who are subject to this
10subsection (i) have the same rights, remedies, privileges,
11immunities, powers, and duties, (ii) are subject to the same
12conditions, restrictions, limitations, penalties, and
13definitions of terms, and (iii) shall employ the same modes of
14procedure as are set forth in Sections 1 through 1o, 2 through
152-70 (in respect to all provisions contained in those Sections
16other than the State rate of tax), 2a through 2h, 3 (except as
17to the disposition of taxes and penalties collected), 4, 5, 5a,
185b, 5c, 5d, 5e, 5f, 5g, 5h, 5i, 5l, 6, 6a, 6b, 6c, 7, 8, 9, 10,
1911, 11a, 12, and 13 of the Retailers' Occupation Tax Act and
20all provisions of the Uniform Penalty and Interest Act as if
21those provisions were set forth in this subsection.
22    Persons subject to any tax imposed under this Section may
23reimburse themselves for their seller's tax liability
24hereunder by separately stating the tax as an additional
25charge, which charge may be stated in combination in a single
26amount with State taxes that sellers are required to collect

 

 

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1under the Use Tax Act, under any bracket schedules the
2Department may prescribe.
3    If a tax is imposed under this subsection (a), a tax shall
4also be imposed under subsection (b) of this Section.
5    (b) If a tax has been imposed under subsection (a), a flood
6prevention service occupation tax shall also be imposed upon
7all persons engaged within the territory of the district in the
8business of making sales of service, who, as an incident to
9making the sales of service, transfer tangible personal
10property, either in the form of tangible personal property or
11in the form of real estate as an incident to a sale of service
12to provide revenue to pay the costs of providing emergency
13levee repair and flood prevention and to secure the payment of
14bonds, notes, and other evidences of indebtedness issued under
15this Act for a period not to exceed 25 years or as required to
16repay the bonds, notes, and other evidences of indebtedness.
17The tax rate shall be 0.25% of the selling price of all
18tangible personal property transferred.
19    The tax imposed under this subsection and all civil
20penalties that may be assessed as an incident thereof shall be
21collected and enforced by the State Department of Revenue. The
22Department shall have full power to administer and enforce this
23subsection; to collect all taxes and penalties due hereunder;
24to dispose of taxes and penalties collected in the manner
25hereinafter provided; and to determine all rights to credit
26memoranda arising on account of the erroneous payment of tax or

 

 

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1penalty hereunder.
2    In the administration of and compliance with this
3subsection, the Department and persons who are subject to this
4subsection shall (i) have the same rights, remedies,
5privileges, immunities, powers, and duties, (ii) be subject to
6the same conditions, restrictions, limitations, penalties, and
7definitions of terms, and (iii) employ the same modes of
8procedure as are set forth in Sections 2 (except that the
9reference to State in the definition of supplier maintaining a
10place of business in this State means the district), 2a through
112d, 3 through 3-50 (in respect to all provisions contained in
12those Sections other than the State rate of tax), 4 (except
13that the reference to the State shall be to the district), 5,
147, 8 (except that the jurisdiction to which the tax is a debt
15to the extent indicated in that Section 8 is the district), 9
16(except as to the disposition of taxes and penalties
17collected), 10, 11, 12 (except the reference therein to Section
182b of the Retailers' Occupation Tax Act), 13 (except that any
19reference to the State means the district), Section 15, 16, 17,
2018, 19, and 20 of the Service Occupation Tax Act and all
21provisions of the Uniform Penalty and Interest Act, as fully as
22if those provisions were set forth herein.
23    Persons subject to any tax imposed under the authority
24granted in this subsection may reimburse themselves for their
25serviceman's tax liability hereunder by separately stating the
26tax as an additional charge, that charge may be stated in

 

 

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1combination in a single amount with State tax that servicemen
2are authorized to collect under the Service Use Tax Act, under
3any bracket schedules the Department may prescribe.
4    (c) The taxes imposed in subsections (a) and (b) may not be
5imposed on personal property titled or registered with an
6agency of the State; food for human consumption that is to be
7consumed off the premises where it is sold (other than
8alcoholic beverages, soft drinks, and food that has been
9prepared for immediate consumption); prescription and
10non-prescription medicines, drugs, and medical appliances;
11modifications to a motor vehicle for the purpose of rendering
12it usable by a disabled person; or insulin, urine testing
13materials, and syringes and needles used by diabetics.
14    (d) Nothing in this Section shall be construed to authorize
15the district to impose a tax upon the privilege of engaging in
16any business that under the Constitution of the United States
17may not be made the subject of taxation by the State.
18    (e) The certificate of registration that is issued by the
19Department to a retailer under the Retailers' Occupation Tax
20Act or a serviceman under the Service Occupation Tax Act
21permits the retailer or serviceman to engage in a business that
22is taxable without registering separately with the Department
23under an ordinance or resolution under this Section.
24    (f) The Department shall immediately pay over to the State
25Treasurer, ex officio, as trustee, all taxes and penalties
26collected under this Section to be deposited into the Flood

 

 

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1Prevention Occupation Tax Fund, which shall be an
2unappropriated trust fund held outside the State treasury.
3    As soon as possible after the first day of each month,
4beginning January 1, 2011, upon certification of the Department
5of Revenue, the Comptroller shall order transferred, and the
6Treasurer shall transfer, to the STAR Bonds Revenue Fund the
7local sales tax increment, as defined in the Innovation
8Development and Economy Act, collected under this Section
9during the second preceding calendar month for sales within a
10STAR bond district. The Department shall make this
11certification only if the flood prevention district imposes a
12tax on real property as provided in the definition of "local
13sales taxes" under the Innovation Development and Economy Act.
14    On After the monthly transfer to the STAR Bonds Revenue
15Fund, on or before the 25th day of each calendar month, the
16Department shall prepare and certify to the Comptroller the
17disbursement of stated sums of money to the counties from which
18retailers or servicemen have paid taxes or penalties to the
19Department during the second preceding calendar month. The
20amount to be paid to each county is equal to the amount (not
21including credit memoranda) collected from the county under
22this Section during the second preceding calendar month by the
23Department, (i) less 2% of that amount, which shall be
24deposited into the Tax Compliance and Administration Fund and
25shall be used by the Department in administering and enforcing
26the provisions of this Section on behalf of the county, (ii)

 

 

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1plus an amount that the Department determines is necessary to
2offset any amounts that were erroneously paid to a different
3taxing body; (iii) less an amount equal to the amount of
4refunds made during the second preceding calendar month by the
5Department on behalf of the county; and (iv) less any amount
6that the Department determines is necessary to offset any
7amounts that were payable to a different taxing body but were
8erroneously paid to the county; and (v) less any amounts that
9are transferred to the STAR Bonds Revenue Fund. When certifying
10the amount of a monthly disbursement to a county under this
11Section, the Department shall increase or decrease the amounts
12by an amount necessary to offset any miscalculation of previous
13disbursements within the previous 6 months from the time a
14miscalculation is discovered.
15    Within 10 days after receipt by the Comptroller from the
16Department of the disbursement certification to the counties
17provided for in this Section, the Comptroller shall cause the
18orders to be drawn for the respective amounts in accordance
19with directions contained in the certification.
20    If the Department determines that a refund should be made
21under this Section to a claimant instead of issuing a credit
22memorandum, then the Department shall notify the Comptroller,
23who shall cause the order to be drawn for the amount specified
24and to the person named in the notification from the
25Department. The refund shall be paid by the Treasurer out of
26the Flood Prevention Occupation Tax Fund.

 

 

SB1712 Engrossed- 29 -LRB097 09992 RLJ 50162 b

1    (g) If a county imposes a tax under this Section, then the
2county board shall, by ordinance, discontinue the tax upon the
3payment of all indebtedness of the flood prevention district.
4The tax shall not be discontinued until all indebtedness of the
5District has been paid.
6    (h) Any ordinance imposing the tax under this Section, or
7any ordinance that discontinues the tax, must be certified by
8the county clerk and filed with the Illinois Department of
9Revenue either (i) on or before the first day of April,
10whereupon the Department shall proceed to administer and
11enforce the tax or change in the rate as of the first day of
12July next following the filing; or (ii) on or before the first
13day of October, whereupon the Department shall proceed to
14administer and enforce the tax or change in the rate as of the
15first day of January next following the filing.
16    (j) County Flood Prevention Occupation Tax Fund. All
17proceeds received by a county from a tax distribution under
18this Section must be maintained in a special fund known as the
19[name of county] flood prevention occupation tax fund. The
20county shall, at the direction of the flood prevention
21district, use moneys in the fund to pay the costs of providing
22emergency levee repair and flood prevention and to pay bonds,
23notes, and other evidences of indebtedness issued under this
24Act.
25    (k) This Section may be cited as the Flood Prevention
26Occupation Tax Law.

 

 

SB1712 Engrossed- 30 -LRB097 09992 RLJ 50162 b

1(Source: P.A. 95-719, eff. 5-21-08; 95-723, eff. 6-23-08;
296-939, eff. 6-24-10.)
 
3    Section 99. Effective date. This Act takes effect upon
4becoming law.