Full Text of HB3934 97th General Assembly
HB3934 97TH GENERAL ASSEMBLY |
| | 97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012 HB3934 Introduced 1/10/2012, by Rep. Jack D. Franks SYNOPSIS AS INTRODUCED: |
| 20 ILCS 2505/2505-503 new | | 35 ILCS 10/5-10 | | 35 ILCS 10/5-20 | | 35 ILCS 10/5-45 | | 35 ILCS 10/5-50 | |
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Amends the Department of Revenue Law of the
Civil Administrative Code of Illinois. Creates the Economic Incentive Committee within the Department for the purpose of approving Agreements entered into under the Economic Development for a Growing Economy Tax Credit Act. Sets forth the membership of the Committee. Provides that the Department of Revenue shall post the terms of each Agreement entered into under the Economic Development for a Growing Economy Tax Credit Act on its website. Amends the Economic Development for a Growing Economy Tax Credit Act to provide that each Agreement is subject to final approval by the Economic Incentive Committee. Effective July 1, 2012.
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| | | FISCAL NOTE ACT MAY APPLY | |
| | A BILL FOR |
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| 1 | | AN ACT concerning revenue.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Department of Revenue Law of the
Civil | 5 | | Administrative Code of Illinois is amended by adding Section | 6 | | 2505-503 as follows: | 7 | | (20 ILCS 2505/2505-503 new) | 8 | | Sec. 2505-503. Economic Incentive Committee; creation; | 9 | | duties. An Economic Incentive Committee is created within the | 10 | | Department for the purpose of approving Agreements entered into | 11 | | under the Economic Development for a Growing Economy Tax Credit | 12 | | Act. The Committee shall consist of 5 members appointed as | 13 | | follows: one member shall be appointed by the Governor; one | 14 | | member shall be appointed by the Speaker of the House of | 15 | | Representatives; one member shall be appointed by the President | 16 | | of the Senate; one member shall be appointed by the House | 17 | | Minority Leader; and one member shall be appointed by the | 18 | | Senate Minority Leader. Each member of the Committee shall be a | 19 | | business owner or shall have expertise in economic development | 20 | | or academia. | 21 | | The Committee shall approve or deny each Agreement within | 22 | | 60 days after the Agreement is submitted to the Committee. | 23 | | Members shall serve without compensation, but may be reimbursed |
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| 1 | | for their necessary expenses. If a member has a conflict of | 2 | | interest with respect to any Agreement, he or she shall recuse | 3 | | himself or herself from consideration of that Agreement. The | 4 | | Committee shall consider each Agreement submitted on or before | 5 | | December 31, 2016 and shall be dissolved as soon after that | 6 | | date as possible. | 7 | | The Department shall post the terms of each Agreement | 8 | | entered into under the Economic Development for a Growing | 9 | | Economy Tax Credit Act on its website. | 10 | | Section 10. The Economic Development for a Growing Economy | 11 | | Tax Credit Act is amended by changing Sections 5-10, 5-20, | 12 | | 5-45, and 5-50 as follows:
| 13 | | (35 ILCS 10/5-10)
| 14 | | Sec. 5-10. Powers of the Department. The Department, in
| 15 | | addition to those powers
granted under the Civil Administrative | 16 | | Code of Illinois, is granted and shall
have all the powers | 17 | | necessary
or convenient to carry out and effectuate the | 18 | | purposes and provisions of this
Act, including, but not limited
| 19 | | to, power and authority to:
| 20 | | (a) Promulgate procedures, rules, or regulations deemed | 21 | | necessary and
appropriate for the
administration of the | 22 | | programs; establish forms for applications,
notifications, | 23 | | contracts, or any other
agreements; and accept applications at | 24 | | any time during the year.
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| 1 | | (b) Provide and assist Taxpayers pursuant to the
provisions | 2 | | of this Act, and
cooperate with Taxpayers that are parties to | 3 | | Agreements
to promote, foster, and
support economic | 4 | | development, capital investment, and job creation or retention
| 5 | | within the State.
| 6 | | (c) Enter into agreements and memoranda of understanding | 7 | | for participation
of and engage in
cooperation with agencies of | 8 | | the federal government, local units of government,
| 9 | | universities, research
foundations or institutions, regional | 10 | | economic development corporations, or
other organizations for | 11 | | the
purposes of this Act.
| 12 | | (d) Gather information and conduct inquiries, in the manner | 13 | | and by the
methods as it deems desirable,
including without | 14 | | limitation, gathering information with respect to
Applicants | 15 | | for the
purpose of making any designations or certifications | 16 | | necessary or desirable or
to gather information to
assist the | 17 | | Committee with any recommendation or guidance in the | 18 | | furtherance of
the purposes of this Act.
| 19 | | (e) Establish, negotiate and effectuate any term, | 20 | | agreement or other
document with any person,
necessary or | 21 | | appropriate to accomplish the purposes of this Act; and to
| 22 | | consent, subject to the provisions
of any Agreement with | 23 | | another party, to the modification or restructuring of
any | 24 | | Agreement to which the
Department is a party , provided that all | 25 | | Agreements entered into on or after the effective date of this | 26 | | amendatory Act of the 97th General Assembly, and all |
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| 1 | | modifications to or restructuring of Agreements occurring on or | 2 | | after the effective date of this amendatory Act of the 97th | 3 | | General Assembly, require the approval of the Economic | 4 | | Incentive Committee established under Section 2505-503 of the | 5 | | Department of Revenue Law of the
Civil Administrative Code of | 6 | | Illinois .
| 7 | | (f) Fix, determine, charge, and collect any premiums, fees, | 8 | | charges, costs,
and expenses from Applicants,
including, | 9 | | without limitation,
any
application fees,
commitment fees, | 10 | | program fees, financing charges, or publication fees as deemed
| 11 | | appropriate to pay
expenses necessary or incident to the | 12 | | administration, staffing, or operation in
connection with the
| 13 | | Department's or Committee's activities under this Act, or for | 14 | | preparation,
implementation, and
enforcement of the terms of | 15 | | the Agreement, or for consultation, advisory and
legal fees, | 16 | | and other costs;
however, all fees and expenses incident | 17 | | thereto shall be the responsibility of
the Applicant.
| 18 | | (g) Provide for sufficient personnel to permit | 19 | | administration, staffing,
operation, and related support
| 20 | | required to adequately discharge its duties and | 21 | | responsibilities described in
this Act from funds made
| 22 | | available through charges to Applicants
or from funds as
may be | 23 | | appropriated by the General Assembly for the administration of | 24 | | this Act.
| 25 | | (h) Require Applicants, upon written request, to
issue any | 26 | | necessary
authorization to the appropriate federal, state, or |
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| 1 | | local authority for the
release of information concerning a
| 2 | | project being considered under the
provisions of this Act, with | 3 | | the
information requested to include, but not be limited to, | 4 | | financial reports,
returns, or records relating to the
| 5 | | Taxpayers' or its project.
| 6 | | (i) Require that a Taxpayer shall at all times
keep proper | 7 | | books
of record and account in accordance with generally | 8 | | accepted accounting
principles consistently applied,
with the | 9 | | books, records, or papers related to the Agreement in the | 10 | | custody or
control of the Taxpayer open for
reasonable | 11 | | Department inspection and audits, and including, without | 12 | | limitation,
the making of copies of the
books, records, or | 13 | | papers, and the inspection or appraisal of any of the
Taxpayer | 14 | | or project assets.
| 15 | | (j) Take whatever actions are necessary or appropriate to | 16 | | protect the
State's interest in the
event of bankruptcy, | 17 | | default, foreclosure, or noncompliance with the terms and
| 18 | | conditions of financial
assistance or participation required | 19 | | under this Act, including the power to
sell, dispose, lease, or | 20 | | rent, upon
terms and conditions determined by the Director to | 21 | | be appropriate, real or
personal property that the
Department | 22 | | may receive as a result of these actions.
| 23 | | (Source: P.A. 91-476, eff. 8-11-99.)
| 24 | | (35 ILCS 10/5-20)
| 25 | | Sec. 5-20. Application for a project to create and retain |
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| 1 | | new jobs.
| 2 | | (a) Any Taxpayer proposing a project located or planned to | 3 | | be located in
Illinois may request consideration
for | 4 | | designation of its project, by formal written letter of request | 5 | | or by
formal application to the Department,
in which the | 6 | | Applicant states its intent to make at least a specified level | 7 | | of
investment and
intends to hire or retain a
specified number | 8 | | of full-time employees at a designated location in Illinois.
As
| 9 | | circumstances require, the
Department may require a formal | 10 | | application from an Applicant and a formal
letter of request | 11 | | for
assistance.
| 12 | | (b) In order to qualify for Credits under this Act, an | 13 | | Applicant's project
must:
| 14 | | (1) involve an investment of at least $5,000,000 in | 15 | | capital improvements
to be placed in service and to employ | 16 | | at least 25 New Employees within the
State as a direct | 17 | | result of the project;
| 18 | | (2) involve an investment of at least an amount (to be | 19 | | expressly specified
by the Department and the Committee) in | 20 | | capital improvements to be placed in
service and will | 21 | | employ at least an amount (to be expressly specified by the
| 22 | | Department and the Committee) of New Employees
within the | 23 | | State, provided that the Department and the Committee have
| 24 | | determined that the project will provide a substantial | 25 | | economic benefit to the
State; or | 26 | | (3) if the applicant has 100 or fewer employees, |
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| 1 | | involve an investment of at least $1,000,000 in capital | 2 | | improvements to be placed in service and to employ at least | 3 | | 5 New Employees within the State as a direct result of the | 4 | | project.
| 5 | | (c) After receipt of an application, the Department may | 6 | | enter into an
Agreement with the Applicant if the
application | 7 | | is accepted in accordance with Section 5-25 and the Agreement | 8 | | is approved by the Economic Incentive Committee established | 9 | | under Section 2505-503 of the Department of Revenue Law of the
| 10 | | Civil Administrative Code of Illinois .
| 11 | | (Source: P.A. 93-882, eff. 1-1-05.)
| 12 | | (35 ILCS 10/5-45)
| 13 | | Sec. 5-45. Amount and duration of the credit.
| 14 | | (a) The Department shall
determine the amount and
duration | 15 | | of the credit awarded under this Act. The duration of the
| 16 | | credit may not exceed 10 taxable years.
The credit may be | 17 | | stated as
a percentage of the Incremental Income Tax | 18 | | attributable
to the applicant's project and may include a fixed | 19 | | dollar limitation. With respect to Agreements entered into or | 20 | | modified on or after the effective date of this amendatory Act | 21 | | of the 97th General Assembly, the amount and duration of the | 22 | | credit is subject to final approval by the Economic Incentive | 23 | | Committee established under Section 2505-503 of the Department | 24 | | of Revenue Law of the
Civil Administrative Code of Illinois.
| 25 | | (b) Notwithstanding subsection (a),
and except as the |
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| 1 | | credit may be applied in a carryover year pursuant to Section
| 2 | | 211(4) of the Illinois Income Tax Act, the credit may be | 3 | | applied against the
State income tax liability in more than 10 | 4 | | taxable years but not in more than
15 taxable years for an | 5 | | eligible business
that (i) qualifies under this Act
and the | 6 | | Corporate Headquarters Relocation Act and has in fact | 7 | | undertaken a
qualifying project within the time frame specified | 8 | | by the Department of
Commerce and Economic Opportunity under | 9 | | that Act, and (ii) applies against its
State income tax | 10 | | liability, during the entire 15-year
period, no more than 60% | 11 | | of the maximum
credit per year that would otherwise be | 12 | | available under this Act.
| 13 | | (Source: P.A. 94-793, eff. 5-19-06.)
| 14 | | (35 ILCS 10/5-50)
| 15 | | Sec. 5-50. Contents of Agreements with Applicants. The | 16 | | Department shall
enter into an Agreement with an
Applicant that | 17 | | is awarded a Credit under this Act. The Agreement
must include | 18 | | all of the following:
| 19 | | (1) A detailed description of the project that is the | 20 | | subject of the
Agreement, including the location and amount | 21 | | of the investment and jobs created
or retained.
| 22 | | (2) The duration of the Credit and the first taxable | 23 | | year for which
the Credit may be claimed.
| 24 | | (3) The Credit amount that will be allowed for each | 25 | | taxable year.
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| 1 | | (4) A requirement that the Taxpayer shall maintain | 2 | | operations at the
project location that shall be stated as | 3 | | a minimum number of years not to
exceed 10.
| 4 | | (5) A specific method for determining the number of New | 5 | | Employees
employed during a taxable year.
| 6 | | (6) A requirement that the Taxpayer shall annually | 7 | | report to the
Department the number of New Employees,
the | 8 | | Incremental Income Tax
withheld in connection with the New | 9 | | Employees, and any other
information the Director needs to | 10 | | perform the Director's duties under
this Act.
| 11 | | (7) A requirement that the Director is authorized to | 12 | | verify with the
appropriate State agencies the amounts | 13 | | reported under paragraph
(6), and after doing so shall | 14 | | issue a certificate to the Taxpayer
stating that the | 15 | | amounts have been verified.
| 16 | | (8) A requirement that the Taxpayer shall provide | 17 | | written
notification to the Director not more than 30
days | 18 | | after the Taxpayer makes or receives a proposal that would
| 19 | | transfer the Taxpayer's State tax liability obligations to | 20 | | a
successor Taxpayer.
| 21 | | (9) A detailed description of the number of New | 22 | | Employees to be
hired, and the occupation and
payroll of | 23 | | the full-time jobs to be created or retained as a result of | 24 | | the
project.
| 25 | | (10) The minimum investment the business enterprise | 26 | | will make in
capital improvements, the time period
for |
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| 1 | | placing the property in service, and the designated | 2 | | location in Illinois
for the investment.
| 3 | | (11) A requirement that the Taxpayer shall provide | 4 | | written
notification to the Director and
the Committee not | 5 | | more than 30 days after the Taxpayer determines
that the | 6 | | minimum
job creation or retention, employment payroll, or | 7 | | investment no longer is being
or will be achieved or
| 8 | | maintained as set forth in the terms and conditions of the
| 9 | | Agreement.
| 10 | | (12) A provision that, if the total number of New | 11 | | Employees falls
below a specified level, the
allowance of | 12 | | Credit shall be suspended until the number of New
Employees | 13 | | equals or exceeds
the Agreement amount.
| 14 | | (13) A detailed description of the items for which the | 15 | | costs incurred by
the Taxpayer will be included
in the | 16 | | limitation on the Credit provided in Section 5-30.
| 17 | | (13.5) A provision that, if the Taxpayer never meets | 18 | | either the investment or job creation and retention | 19 | | requirements specified in the Agreement during the entire | 20 | | 5-year period beginning on the first day of the first | 21 | | taxable year in which the Agreement is executed and ending | 22 | | on the last day of the fifth taxable year after the | 23 | | Agreement is executed, then the Agreement is automatically | 24 | | terminated on the last day of the fifth taxable year after | 25 | | the Agreement is executed and the Taxpayer is not entitled | 26 | | to the award of any credits for any of that 5-year period.
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| 1 | | (14) Any other performance conditions or contract | 2 | | provisions as the
Department determines are
appropriate.
| 3 | | Any Agreement entered into on or after the effective date | 4 | | of this amendatory Act of the 97th General Assembly is subject | 5 | | to the approval of the Economic Incentive Committee established | 6 | | under Section 2505-503 of the Department of Revenue Law of the
| 7 | | Civil Administrative Code of Illinois. Any modifications to an | 8 | | existing Agreement that take effect on or after the effective | 9 | | date of this amendatory Act of the 97th General Assembly are | 10 | | subject to the approval of the Economic Incentive Committee | 11 | | established under Section 2505-503 of the Department of Revenue | 12 | | Law of the
Civil Administrative Code of Illinois. The | 13 | | Department must forward any proposed Agreements or | 14 | | modifications to the Economic Incentive Committee within 15 | 15 | | days after the terms of the Agreement or modification are | 16 | | finalized. | 17 | | (Source: P.A. 97-2, eff. 5-6-11.)
| 18 | | Section 99. Effective date. This Act takes effect July 1, | 19 | | 2012.
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