HB5460 102ND GENERAL ASSEMBLY

LRB102 25473 RJF 34760 b

102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB5460

Introduced 1/31/2022, by Rep. Ryan Spain

SYNOPSIS AS INTRODUCED:

New Act
20 ILCS 605/605-1027 new
30 ILCS 105/5.970 new
30 ILCS 105/5.971 new
30 ILCS 105/5.972 new
35 ILCS 5/229.5 new

Creates the Illinois Biomanufacturing Act. Provides for the creation of the Illinois Biomanufacturing Institute. Provides for the Board of Directors of the Institute. Provides for the duties of the Institute. Provides for funding of the Institute. Provides Institute reporting requirements. Creates the Biomanufacturing Initiative Task Force. Provides purpose and duties of the Task Force. Provides for Task Force membership. Provides for meetings of the Task Force. Provides for administrative support for the Task Force. Provides Task Force reporting requirements. Creates the Biomanufacturing Equity Investment Fund, the Biomanufacturing Loan Fund, and the Biomanufacturing Grant Fund as special funds in the State treasury for specified purposes concerning investment in and funding of biomanufacturing centers. Amends the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois. Provides for tax credits for qualifying biomanufacturing centers. Provides further requirements concerning the issuance of the tax credit. Amends the State Finance Act to provide for specified special funds. Amends the Illinois Income Tax Act to provide for the biomanufacturing center tax credit. Defines terms.

A BILL FOR

AN ACT concerning State government.

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

Section 1. Short title. This Act may be cited as the Illinois Biomanufacturing Act.

Section 5. Definitions. As used in this Act:

"Biomanufacturing center" means a wholly enclosed facility that has the primary purpose of using biological processes, entirely carried out in-house within the center, to manufacture products to be sold in a marketplace, which contains tanks, boxes, or other sealed and enclosed spaces for biochemical production purposes. "Biomanufacturing center" includes any production facility that complies with North American Industry Classification System (NAICS) codes 325412 and 325414. "Biomanufacturing center" does not include a space used as a greenhouse or other space used to grow plants, such as cannabis or salad greens, that could physically be grown outdoors.

"Department" means the Department of Commerce and Economic Opportunity.

"Institute" means the Illinois Manufacturing Institute established under this Act.

"Task Force" means the Biomanufacturing Initiative Task Force established under this Act.

Section 10. Illinois Biomanufacturing Institute.

(a) There is hereby created the Illinois Biomanufacturing Institute. The Institute is hereby constituted a public instrumentality under the jurisdiction of the Department of Commerce and Economic Opportunity, and the exercise by the Institute of the powers conferred by this Act shall be considered to be the performance of an essential governmental function.

(b) The Institute shall be governed and its corporate powers exercised by a Board of Directors consisting of 7 directors as follows: (i) the Director of Commerce and Economic Opportunity, or his or her designee; (ii) the President of the University of Illinois, or his or her designee; and (iii) 5 persons appointed by the Governor, with a background in biomanufacturing and biotechnology and representing the biomanufacturing industry.

The 5 directors appointed by the Governor shall constitute a quorum and the affirmative vote of a majority of directors present at a duly called meeting if a quorum is present shall be necessary for any action to be taken by the Board. Any action required or permitted to be taken at a meeting of the directors may be taken without a meeting if all of the directors' consent in writing to such action and such written consent is filed with the records of the minutes of the meetings of the Board. Such consent shall be treated for all purposes as a vote at a meeting.

The members of the Board shall serve without compensation, but each member shall be entitled to reimbursement for his actual and necessary expenses incurred in the performance of his official duties.

(c) The Institute shall be located in or near a major metropolitan area in this State with historic ties to biomanufacturing, and in a location that is easily accessible by common modes of transportation.

(d) The Institute shall cooperate with all of the tax-eligible biomanufacturing centers of Illinois, with the goal of making these centers into incubators of local job creation throughout the State. The Institute is also encouraged, but not required, to cooperate with all Illinois institutions of higher education, including faculties of biochemistry and faculties of medical research, to develop cooperative programs of Illinois-based research, development, and production.

(e) Subject to appropriation, the Institute shall receive funding for its start-up and operational purposes from funds made available for its purposes by the General Assembly, with the understanding that the Institute would be mandated to take steps toward self-funding with the goal of becoming an autonomous, grant-supported think tank based in Illinois.

(f) The Institute shall provide an annual report to the Governor and the General Assembly concerning its operations and any other information it deems relevant.

Section 15. Biomanufacturing Initiative Task Force.

(a) There is hereby created the Biomanufacturing Initiative Task Force. The Task Force shall represent the interests of institutions of higher education and the biomanufacturing industry, and advise the Institute on biomanufacturing-related research and development and provide recommendations.

(b) The Task Force shall, at a minimum, consist of members appointed by the Governor as follows: (i) a representative of Illinois universities; (ii) a representative of a public or private medical school; (iii) a representative of the Illinois biomanufacturing industry; and (iv) any other member that the Governor deems necessary and proper for the purposes of the Task Force. The Director of Commerce and Economic Opportunity, or his or her designee, shall also serve as a member of the Task Force. The Governor shall appoint a Chair for the Task Force.

(c) The Task Force shall meet at least quarterly for the purpose of its duties under this Section.

(d) Members of the Task Force shall serve without compensation.

(e) The Department of Commerce and Economic Opportunity shall provide administrative and other support to the Task Force.

(f) The Task Force shall at least annually, and as otherwise frequently as it deems necessary, issue a report to the Institute, the Governor, and the General Assembly detailing its advisements on biomanufacturing-related research and development, and any related recommendations.

Section 20. Biomanufacturing Equity Investment Fund. The Biomanufacturing Equity Investment Fund is created as a special fund in the State treasury and may receive funds from any source, public or private, including moneys appropriated for use by the Department of Commerce and Economic Opportunity. Subject to appropriation, moneys in the Fund shall be used by the Department and the Institute to make qualified equity investments in Illinois-based biomanufacturing centers.

Section 25. Biomanufacturing Loan Fund. The Biomanufacturing Loan Fund is created as a special fund in the State treasury and may receive funds from any source, public or private, including moneys appropriated for use by the Department of Commerce and Economic Opportunity. Subject to appropriation, moneys in the Fund shall be used by the Department and the Institute to make qualified loans to Illinois-based biomanufacturing centers for the start-up and operation of such centers, and for any other related purposes as determined by the Department. The repayment of loans issued under this Section shall be as prescribed by the Department.

Section 30. Biomanufacturing Grant Fund. The Biomanufacturing Grant Fund is created as a special fund in the State treasury and may receive funds from any source, public or private, including moneys appropriated for use by the Department of Commerce and Economic Opportunity. Subject to appropriation, moneys in the Fund shall be used by the Department and the Institute to make grants to Illinois-based biomanufacturing centers to stimulate increased financing for biomanufacturing technology, research, and development, and for any other related purposes as determined by the Department.

Section 35. Rules. The Department shall adopt all rules necessary for the implementation of this Act.

Section 100. The Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois is amended by adding Section 605-1027 as follows:

(20 ILCS 605/605-1027 new)

Sec. 605-1027. Biomanufacturing center investment.

(a) The Department shall issue a credit certification against the taxes imposed under subsections (a) and (b) of Section 201 of the Illinois Income Tax Act to qualifying biomanufacturing centers. For taxable years beginning on or after January 1, 2023, the Department shall award credits, in an amount as determined by the Department, against the taxes imposed under subsections (a) and (b) of Section 201 of the Illinois Income Tax Act as provided in Section 229.5 of the Illinois Income Tax Act.

(b) For purposes of this Section:

"Biomanufacturing center" means a wholly enclosed facility that has the primary purpose of using biological processes, entirely carried out in-house within the center, to manufacture products to be sold in a marketplace, which contains tanks, boxes, or other sealed and enclosed spaces for biochemical production purposes. "Biomanufacturing center" includes any production facility that complies with North American Industry Classification System (NAICS) codes 325412 and 325414. "Biomanufacturing center" does not include a space used as a greenhouse or other space used to grow plants, such as cannabis or salad greens, that could physically be grown outdoors.

"Full-time equivalent job" means a job in which the new employee works for the owner, operator, contractor, or tenant of a biomanufacturing center or for a corporation under contract with the owner, operator or tenant of a center at a rate of at least 35 hours per week.

"Qualifying biomanufacturing center" means a new or existing biomanufacturing center that:

(1) is located in the State of Illinois;

(2) makes or has made a capital investment of at least $2,000,000 collectively over a 2-year period;

(3) results in the creation of at least 20 full-time or full-time equivalent jobs over a period of 5 years. These jobs must have a total compensation equal to or greater than 120% of the average wage paid to full-time employees in the county where the data center is located, as determined by the U.S. Bureau of Labor Statistics; and

(4) within 2 years after being placed in service, certifies to the Department that it is carbon neutral or has attained green building standards certification from a Department-approved entity.

(c) Biomanufacturing centers seeking a tax credit certification shall apply to the Department in the manner specified by the Department. The Department and any center seeking the certification, must enter into a memorandum of understanding that at a minimum provides:

(1) the details for determining the amount of capital investment to be made;

(2) the number of new jobs created;

(3) the timeline for achieving the capital investment and new job goals;

(4) the repayment obligation should those goals not be achieved and any conditions under which repayment by the qualifying biomanufacturing center will be required; and

(5) other provisions as deemed necessary by the Department.

(d) Any qualifying biomanufacturing center issued a tax credit certification under this Section must annually submit a private, sealed report to the Department on its operations. The Department shall then issue an annual public report to the Governor and the General Assembly concerning the program established under this Section. The public report issued by the Department shall, at a minimum, contain cumulative data sets that will mask the specific data submitted by each biomanufacturing center about its own operations.

(e) In administering the requirements of this Section, the Department shall consult with the Illinois Biomanufacturing Institute and the Biomanufacturing Initiative Task Force created under the Illinois Biomanufacturing Act.

(f) The Department shall not issue any new tax credit certification under the provisions of this Section after tax year 2040, unless the General Assembly otherwise approves an extension of the tax credit provided under this Section.

(g) The Department shall adopt rules to implement and administer this Section.

Section 105. The State Finance Act is amended by adding Sections 5.970, 5.971, and 5.972 as follows:

(30 ILCS 105/5.970 new)

Sec. 5.970. The Biomanufacturing Equity Investment Fund.

(30 ILCS 105/5.971 new)

Sec. 5.971. The Biomanufacturing Loan Fund.

(30 ILCS 105/5.972 new)

Sec. 5.972. The Biomanufacturing Grant Fund.

Section 110. The Illinois Income Tax Act is amended by adding Section 229.5 as follows:

(35 ILCS 5/229.5 new)

Sec. 229.5. Biomanufacturing center tax credit.

(a) A taxpayer who has been awarded a credit by the Department of Commerce and Economic Opportunity under Section 605-1027 of the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois is entitled to a credit against the taxes imposed under subsections (a) and (b) of Section 201 of this Act in an amount determined under that Act by the Department of Commerce and Economic Opportunity.

(b) If the taxpayer is a partnership, a Subchapter S corporation, or a limited liability company that has elected partnership tax treatment, the credit shall be allowed to the partners, shareholders, or members in accordance with the determination of income and distributive share of income under Sections 702 and 704 and subchapter S of the Internal Revenue Code, as applicable.

(c) In no event shall a credit under this Section reduce the taxpayer's liability to less than zero. If the amount of the credit exceeds the tax liability for the year, then the excess credit shall be refunded to the taxpayer.

(d) No credit shall be allowed with respect to any certification for any taxable year ending after the revocation of the certification by the Department of Commerce and Economic Opportunity. Upon receiving notification by the Department of Commerce and Economic Opportunity of the revocation of certification, the Department shall notify the taxpayer that no credit is allowed for any taxable year ending after the revocation date, as stated in such notification. If any credit has been allowed with respect to a certification for a taxable year ending after the revocation date, any refund paid to the taxpayer for that taxable year shall, to the extent of that credit allowed, be an erroneous refund within the meaning of Section 912 of this Act.

(e) This Section is exempt from the provisions of Section 250 of this Act.

(f) The Department, in cooperation with the Department of Commerce and Economic Opportunity, shall adopt rules to enforce and administer this Section.