Rep. Robert Rita

Filed: 11/29/2012

 

 


 

 


 
09700SB3573ham002LRB097 18541 AMC 72583 a

1
AMENDMENT TO SENATE BILL 3573

2    AMENDMENT NO. ______. Amend Senate Bill 3573 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Public Utilities Act is amended by changing
5Section 8-403.1 as follows:
 
6    (220 ILCS 5/8-403.1)  (from Ch. 111 2/3, par. 8-403.1)
7    Sec. 8-403.1. Electricity purchased from qualified solid
8waste energy facility; tax credit; distributions for economic
9development.
10    (a) It is hereby declared to be the policy of this State to
11encourage the development of alternate energy production
12facilities in order to conserve our energy resources and to
13provide for their most efficient use.
14    (b) For the purpose of this Section and Section 9-215.1,
15"qualified solid waste energy facility" means a facility
16determined by the Illinois Commerce Commission to qualify as

 

 

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1such under the Local Solid Waste Disposal Act, to use methane
2gas generated from landfills as its primary fuel, and to
3possess characteristics that would enable it to qualify as a
4cogeneration or small power production facility under federal
5law.
6    (c) In furtherance of the policy declared in this Section,
7the Illinois Commerce Commission shall require electric
8utilities to enter into long-term contracts to purchase
9electricity from qualified solid waste energy facilities
10located in the electric utility's service area, for a period
11beginning on the date that the facility begins generating
12electricity and having a duration of not less than 10 years in
13the case of facilities fueled by landfill-generated methane, or
1420 years in the case of facilities fueled by methane generated
15from a landfill owned by a forest preserve district. The
16purchase rate contained in such contracts shall be equal to the
17average amount per kilowatt-hour paid from time to time by the
18unit or units of local government in which the electricity
19generating facilities are located, excluding amounts paid for
20street lighting and pumping service.
21    (d) Whenever a public utility is required to purchase
22electricity pursuant to subsection (c) above, it shall be
23entitled to credits in respect of its obligations to remit to
24the State taxes it has collected under the Electricity Excise
25Tax Law equal to the amounts, if any, by which payments for
26such electricity exceed (i) the then current rate at which the

 

 

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1utility must purchase the output of qualified facilities
2pursuant to the federal Public Utility Regulatory Policies Act
3of 1978, less (ii) any costs, expenses, losses, damages or
4other amounts incurred by the utility, or for which it becomes
5liable, arising out of its failure to obtain such electricity
6from such other sources. The amount of any such credit shall,
7in the first instance, be determined by the utility, which
8shall make a monthly report of such credits to the Illinois
9Commerce Commission and, on its monthly tax return, to the
10Illinois Department of Revenue. Under no circumstances shall a
11utility be required to purchase electricity from a qualified
12solid waste energy facility at the rate prescribed in
13subsection (c) of this Section if such purchase would result in
14estimated tax credits that exceed, on a monthly basis, the
15utility's estimated obligation to remit to the State taxes it
16has collected under the Electricity Excise Tax Law. The owner
17or operator shall negotiate facility operating conditions with
18the purchasing utility in accordance with that utility's posted
19standard terms and conditions for small power producers. If the
20Department of Revenue disputes the amount of any such credit,
21such dispute shall be decided by the Illinois Commerce
22Commission. Whenever a qualified solid waste energy facility
23has paid or otherwise satisfied in full the capital costs or
24indebtedness incurred in developing and implementing the
25qualified solid waste energy facility, whenever the qualified
26solid waste energy facility ceases to operate and produce

 

 

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1electricity from methane gas generated from landfills, or at
2the end of the contract entered into pursuant to subsection (c)
3of this Section, whichever occurs first, the qualified solid
4waste energy facility shall reimburse the Public Utility Fund
5and the General Revenue Fund in the State treasury for the
6actual reduction in payments to those Funds caused by this
7subsection (d) in a manner to be determined by the Illinois
8Commerce Commission and based on the manner in which revenues
9for those Funds were reduced. The payments shall be made to the
10Illinois Commerce Commission, which shall determine the
11appropriate disbursements to the Public Utility Fund and the
12General Revenue Fund based on this subsection (d).
13    (e) The Illinois Commerce Commission shall not require an
14electric utility to purchase electricity from any qualified
15solid waste energy facility which is owned or operated by an
16entity that is primarily engaged in the business of producing
17or selling electricity, gas, or useful thermal energy from a
18source other than one or more qualified solid waste energy
19facilities.
20    (e-5) A qualified solid waste energy facility may receive
21the purchase rate provided in subsection (c) of this Section
22only for kilowatt-hours generated by the use of methane gas
23generated from landfills. The purchase rate provided in
24subsection (c) of this Section does not apply to electricity
25generated by the use of a fuel that is not methane gas
26generated from landfills. If the Illinois Commerce Commission

 

 

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1determines that a qualified solid waste energy facility has
2violated the requirement regarding the use of methane gas
3generated from a landfill as set forth in this subsection
4(e-5), then the Commission shall issue an order requiring that
5the qualified solid waste energy facility repay the State for
6all dollar amounts of electricity sales that are determined by
7the Commission to be the result of the violation. As part of
8that order, the Commission shall have the authority to revoke
9the facility's approval to act as a qualified solid waste
10energy facility granted by the Commission under this Section.
11If the amount owed by the qualified solid waste energy facility
12is not received by the Commission within 90 days after the date
13of the Commission's order that requires repayment, then the
14Commission shall issue an order that revokes the facility's
15approval to act as a qualified solid waste energy facility
16granted by the Commission under this Section. The Commission's
17action that vacates prior qualified solid waste energy facility
18approval does not excuse the repayment to the State treasury
19required by subsection (d) of this Section for utility tax
20credits accumulated up to the time of the Commission's action.
21A qualified solid waste energy facility must receive Commission
22approval before it may use any fuel in addition to methane gas
23generated from a landfill in order to generate electricity. If
24a qualified solid waste energy facility petitions the
25Commission to use any fuel in addition to methane gas generated
26from a landfill to generate electricity, then the Commission

 

 

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1shall have the authority to do the following:
2        (1) establish the methodology for determining the
3    amount of electricity that is generated by the use of
4    methane gas generated from a landfill and the amount that
5    is generated by the use of other fuel;
6        (2) determine all reporting requirements for the
7    qualified solid waste energy facility that are necessary
8    for the Commission to determine the amount of electricity
9    that is generated by the use of methane gas from a landfill
10    and the amount that is generated by the use of other fuel
11    and the resulting payments to the qualified solid waste
12    energy facility; and
13        (3) require that the qualified solid waste energy
14    facility, at the qualified solid waste energy facility's
15    expense, install metering equipment that the Commission
16    determines is necessary to enforce compliance with this
17    subsection (e-5).
18    A public utility that is required to enter into a long-term
19purchase contract with a qualified solid waste energy facility
20has no duty to determine whether the electricity being
21purchased was generated by the use of methane gas generated
22from a landfill or was generated by the use of some other fuel
23in violation of the requirements of this subsection (e-5).
24    (f) This Section does not require an electric utility to
25construct additional facilities unless those facilities are
26paid for by the owner or operator of the affected qualified

 

 

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1solid waste energy facility.
2    (g) The Illinois Commerce Commission shall require that:
3(1) electric utilities use the electricity purchased from a
4qualified solid waste energy facility to displace electricity
5generated from nuclear power or coal mined and purchased
6outside the boundaries of the State of Illinois before
7displacing electricity generated from coal mined and purchased
8within the State of Illinois, to the extent possible, and (2)
9electric utilities report annually to the Commission on the
10extent of such displacements.
11    (h) Nothing in this Section is intended to cause an
12electric utility that is required to purchase power hereunder
13to incur any economic loss as a result of its purchase. All
14amounts paid for power which a utility is required to purchase
15pursuant to subparagraph (c) shall be deemed to be costs
16prudently incurred for purposes of computing charges under
17rates authorized by Section 9-220 of this Act. Tax credits
18provided for herein shall be reflected in charges made pursuant
19to rates so authorized to the extent such credits are based
20upon a cost which is also reflected in such charges.
21    (i) Beginning in February 1999 and through January 2016
222013, each qualified solid waste energy facility that sells
23electricity to an electric utility at the purchase rate
24described in subsection (c) shall file with the Department of
25Revenue on or before the 15th of each month a form, prescribed
26by the Department of Revenue, that states the number of

 

 

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1kilowatt hours of electricity for which payment was received at
2that purchase rate from electric utilities in Illinois during
3the immediately preceding month. This form shall be accompanied
4by a payment from the qualified solid waste energy facility in
5an amount equal to six-tenths of a mill ($0.0006) per kilowatt
6hour of electricity stated on the form. Beginning on the
7effective date of this amendatory Act of the 92nd General
8Assembly, a qualified solid waste energy facility must file the
9form required under this subsection (i) before the 15th of each
10month regardless of whether the facility received any payment
11in the previous month. Payments received by the Department of
12Revenue shall be deposited into the Municipal Economic
13Development Fund, a trust fund created outside the State
14treasury. The State Treasurer may invest the moneys in the Fund
15in any investment authorized by the Public Funds Investment
16Act, and investment income shall be deposited into and become
17part of the Fund. Moneys in the Fund shall be used by the State
18Treasurer as provided in subsection (j).
19    Beginning on July 1, 2006 through January 31, 2016 2013,
20each month the State Treasurer shall certify the following to
21the State Comptroller:
22        (A) the amount received by the Department of Revenue
23    under this subsection (i) during the immediately preceding
24    month; and
25        (B) the amount received by the Department of Revenue
26    under this subsection (i) in the corresponding month in

 

 

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1    calendar year 2002.
2As soon as practicable after receiving the certification from
3the State Treasurer, the State Comptroller shall transfer from
4the General Revenue Fund to the Municipal Economic Development
5Fund in the State treasury an amount equal to the amount by
6which the amount calculated under item (B) of this paragraph
7exceeds the amount calculated under item (A) of this paragraph,
8if any.
9    The obligation of a qualified solid waste energy facility
10to make payments into the Municipal Economic Development Fund
11shall terminate upon either: (1) expiration or termination of a
12facility's contract to sell electricity to an electric utility
13at the purchase rate described in subsection (c); or (2) entry
14of an enforceable, final, and non-appealable order by a court
15of competent jurisdiction that Public Act 89-448 is invalid.
16Payments by a qualified solid waste energy facility into the
17Municipal Economic Development Fund do not relieve the
18qualified solid waste energy facility of its obligation to
19reimburse the Public Utility Fund and the General Revenue Fund
20for the actual reduction in payments to those Funds as a result
21of credits received by electric utilities under subsection (d).
22    A qualified solid waste energy facility that fails to
23timely file the requisite form and payment as required by this
24subsection (i) shall be subject to penalties and interest in
25conformance with the provisions of the Illinois Uniform Penalty
26and Interest Act.

 

 

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1    Every qualified solid waste energy facility subject to the
2provisions of this subsection (i) shall keep and maintain
3records and books of its sales pursuant to subsection (c),
4including payments received from those sales and the
5corresponding tax payments made in accordance with this
6subsection (i), and for purposes of enforcement of this
7subsection (i) all such books and records shall be subject to
8inspection by the Department of Revenue or its duly authorized
9agents or employees.
10    When a qualified solid waste energy facility fails to file
11the form or make the payment required under this subsection
12(i), the Department of Revenue, to the extent that it is
13practical, may enforce the payment obligation in a manner
14consistent with Section 5 of the Retailers' Occupation Tax Act,
15and if necessary may impose and enforce a tax lien in a manner
16consistent with Sections 5a, 5b, 5c, 5d, 5e, 5f, 5g, and 5i of
17the Retailers' Occupation Tax Act. No tax lien may be imposed
18or enforced, however, unless a qualified solid waste energy
19facility fails to make the payment required under this
20subsection (i). Only to the extent necessary and for the
21purpose of enforcing this subsection (i), the Department of
22Revenue may secure necessary information from a qualified solid
23waste energy facility in a manner consistent with Section 10 of
24the Retailers' Occupation Tax Act.
25    All information received by the Department of Revenue in
26its administration and enforcement of this subsection (i) shall

 

 

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1be confidential in a manner consistent with Section 11 of the
2Retailers' Occupation Tax Act. The Department of Revenue may
3adopt rules to implement the provisions of this subsection (i).
4    For purposes of implementing the maximum aggregate
5distribution provisions in subsections (j) and (k), when a
6qualified solid waste energy facility makes a late payment to
7the Department of Revenue for deposit into the Municipal
8Economic Development Fund, that payment and deposit shall be
9attributed to the month and corresponding quarter in which the
10payment should have been made, and the Treasurer shall make
11retroactive distributions or refunds, as the case may be,
12whenever such late payments so require.
13    (j) The State Treasurer, without appropriation, must make
14distributions immediately after January 15, April 15, July 15,
15and October 15 of each year, up to maximum aggregate
16distributions of $500,000 for the distributions made in the 4
17quarters beginning with the April distribution and ending with
18the January distribution, from the Municipal Economic
19Development Fund to each city, village, or incorporated town
20located in Cook County that has approved construction within
21its boundaries of an incinerator that will burn recovered wood
22processed for fuel to generate electricity and will commence
23operation after 2009. Total distributions in the aggregate to
24all qualified cities, villages, and incorporated towns in the 4
25quarters beginning with the April distribution and ending with
26the January distribution shall not exceed $500,000. The amount

 

 

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1of each distribution shall be determined pro rata based on the
2population of the city, village, or incorporated town compared
3to the total population of all cities, villages, and
4incorporated towns eligible to receive a distribution.
5Distributions received by a city, village, or incorporated town
6must be held in a separate account and may be used only to
7promote and enhance industrial, commercial, residential,
8service, transportation, and recreational activities and
9facilities within its boundaries, thereby enhancing the
10employment opportunities, public health and general welfare,
11and economic development within the community, including
12administrative expenditures exclusively to further these
13activities. Distributions may also be used for cleanup of open
14dumping from vacant properties and the removal of structures
15condemned by the city, village, or incorporated town. These
16funds, however, shall not be used by the city, village, or
17incorporated town, directly or indirectly, to purchase, lease,
18operate, or in any way subsidize the operation of any
19incinerator, and these funds shall not be paid, directly or
20indirectly, by the city, village, or incorporated town to the
21owner, operator, lessee, shareholder, or bondholder of any
22incinerator. Moreover, these funds shall not be used to pay
23attorneys fees in any litigation relating to the validity of
24Public Act 89-448. Nothing in this Section prevents a city,
25village, or incorporated town from using other corporate funds
26for any legitimate purpose. For purposes of this subsection,

 

 

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1the term "municipal waste" has the meaning ascribed to it in
2Section 3.290 of the Environmental Protection Act.
3    (k) If maximum aggregate distributions of $500,000 under
4subsection (j) have been made after the January distribution
5from the Municipal Economic Development Fund, then the balance
6in the Fund shall be refunded to the qualified solid waste
7energy facilities that made payments that were deposited into
8the Fund during the previous 12-month period. The refunds shall
9be prorated based upon the facility's payments in relation to
10total payments for that 12-month period.
11    (l) Beginning January 1, 2000, and each January 1
12thereafter, each city, village, or incorporated town that
13received distributions from the Municipal Economic Development
14Fund, continued to hold any of those distributions, or made
15expenditures from those distributions during the immediately
16preceding year shall submit to a financial and compliance and
17program audit of those distributions performed by the Auditor
18General at no cost to the city, village, or incorporated town
19that received the distributions. The audit should be completed
20by June 30 or as soon thereafter as possible. The audit shall
21be submitted to the State Treasurer and those officers
22enumerated in Section 3-14 of the Illinois State Auditing Act.
23If the Auditor General finds that distributions have been
24expended in violation of this Section, the Auditor General
25shall refer the matter to the Attorney General. The Attorney
26General may recover, in a civil action, 3 times the amount of

 

 

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1any distributions illegally expended. For purposes of this
2subsection, the terms "financial audit," "compliance audit",
3and "program audit" have the meanings ascribed to them in
4Sections 1-13 and 1-15 of the Illinois State Auditing Act.
5    (m) On and after the effective date of this amendatory Act
6of the 94th General Assembly, beginning on the first date on
7which renewable energy certificates or other saleable
8representations are sold by a qualified solid waste energy
9facility, with or without the electricity generated by the
10facility, and utilized by an electric utility or another
11electric supplier to comply with a renewable energy portfolio
12standard mandated by Illinois law or mandated by order of the
13Illinois Commerce Commission, that qualified solid waste
14energy facility may not sell electricity pursuant to this
15Section and shall be exempt from the requirements of
16subsections (a) through (l) of this Section, except that it
17shall remain obligated for any reimbursements required under
18subsection (d) of this Section. All of the provisions of this
19Section shall remain in full force and effect with respect to
20any qualified solid waste energy facility that sold electric
21energy pursuant to this Section at any time before July 1, 2006
22and that does not sell renewable energy certificates or other
23saleable representations to meet the requirements of a
24renewable energy portfolio standard mandated by Illinois law or
25mandated by order of the Illinois Commerce Commission.
26    (n) Notwithstanding any other provision of law to the

 

 

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1contrary, beginning on July 1, 2006, the Illinois Commerce
2Commission shall not issue any order determining that a
3facility is a qualified solid waste energy facility unless the
4qualified solid waste energy facility was determined by the
5Illinois Commerce Commission to be a qualified solid waste
6energy facility before July 1, 2006. As a guide to the intent,
7interpretation, and application of this amendatory Act of the
894th General Assembly, it is hereby declared to be the policy
9of this State to honor each qualified solid waste energy
10facility contract in existence on the effective date of this
11amendatory Act of the 94th General Assembly if the qualified
12solid waste energy facility continues to meet the requirements
13of this Section for the duration of its respective contract
14term.
15(Source: P.A. 96-449, eff. 8-14-09.)
 
16    Section 99. Effective date. This Act takes effect upon
17becoming law.".