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90_HB0524
SEE INDEX
Amends the Illinois Enterprise Zone Act, the Property Tax
Code, and the Illinois Municipal Code. Provides that if
property is located in a redevelopment project area and an
enterprise zone, then the enterprise zone abatement of taxes
shall not be available on the property located in the
redevelopment project area, except that business enterprises
or individuals shall be entitled to the abatement on new
improvements or the renovation or rehabilitation of existing
improvements if the business enterprise or individual
establishes that before the date of the adoption of tax
increment financing (i) the new improvement, rehabilitation,
or renovation was committed to locate within the
redevelopment project area, (ii) substantial and binding
financial obligations were made towards the construction,
renovation, or rehabilitation of the improvements, and (iii)
those commitments and obligations were made in reasonable
reliance on the abatement of taxes that are applicable to the
construction, renovation, or rehabilitation of the
improvements. Requires a notice, published in a newspaper of
general circulation within the municipality, that states that
the property shall not be eligible for the abatement of taxes
for enterprise zone property unless certain conditions are
met. Provides that if a municipality determines that property
that lies within a State Sales Tax Boundary has an
improvement, rehabilitation, or renovation that is entitled
to a property tax abatement, then that property and the
improvements, rehabilitations, or renovations shall be
removed from any State Sales Tax Boundary and the
municipality that made the determination shall notify the
Department of Revenue within 30 days. Amends the State
Mandates Act to require implementation without reimbursement.
Makes provisions severable. Effective July 1, 1997.
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1 AN ACT concerning districts.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 5. The Illinois Enterprise Zone Act is amended
5 by adding Section 5.4.1 as follows:
6 (20 ILCS 655/5.4.1 new)
7 Sec. 5.4.1. Adoption of Tax Increment Financing.
8 (a) If (i) a redevelopment project area is created by a
9 municipality under Division 74.4 of the Illinois Municipal
10 Code, (ii) the redevelopment project area contains property
11 that is located in an enterprise zone, and (iii) the
12 municipality did not adopt an amendment to the certified
13 enterprise zone designating ordinance under Section 5.4,
14 then the property that is located in both the enterprise zone
15 and the redevelopment project area shall not be eligible for
16 any abatement of taxes under Section 18-170 of the Property
17 Tax Code; except that business enterprises shall be entitled
18 to the abatement on new improvements or the renovation or
19 rehabilitation of existing improvements of business
20 enterprises or individuals within the redevelopment project
21 area if the business enterprise establishes that before the
22 date of the adoption of tax increment financing (i) the new
23 improvement, rehabilitation, or renovation was committed to
24 locate within the redevelopment project area, (ii)
25 substantial and binding financial obligations were made
26 towards the construction, renovation, or rehabilitation of
27 the improvements, and (iii) those commitments and
28 obligations were made in reasonable reliance on the
29 abatement of real property taxes that are applicable to the
30 construction, renovation, or rehabilitation of the
31 improvements.
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1 (b) This Section applies to all property located within
2 both a redevelopment project area adopted under Division
3 74.4 of the Illinois Municipal Code and an enterprise zone
4 even if the redevelopment project area or the enterprise
5 zone was adopted before the effective date of this
6 amendatory Act of 1997.
7 (c) In declaratory judgment actions under this Section,
8 the Department and the designating municipality shall be
9 necessary parties defendant.
10 (d) If property is located in a redevelopment project
11 area and an enterprise zone, then the municipality where the
12 property is located shall publish a notice in a newspaper of
13 general circulation within that municipality not less than 60
14 days (i) after the effective date of this amendatory Act of
15 1997 if the municipality adopted the redevelopment project
16 area before the effective date of this amendatory Act of
17 1997 or (ii) after the adoption of tax increment financing by
18 the municipality if the municipality adopted tax increment
19 financing on or after the effective date of this amendatory
20 Act. The notice shall be published at least twice and shall
21 state:
22 (1) the legal description and street location, if
23 possible, of any property located in both the enterprise
24 zone and the redevelopment project area;
25 (2) that the municipality has adopted both tax
26 increment financing and an enterprise zone in the
27 described area and the dates of the adoption;
28 (3) that tax abatement for the enterprise zone
29 under Section 18-170 of the Property Tax Code will not be
30 available to any improvements, rehabilitation, or
31 renovation constructed in the described area unless: (i)
32 the improvement, rehabilitation, or renovation was
33 committed to before the date of the adoption of tax
34 increment financing by the municipality; (ii) substantial
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1 and binding financial obligations were made toward the
2 construction, renovation, or rehabilitation of the
3 improvements before the date of the adoption of tax
4 increment financing by the municipality; and (iii) those
5 commitments and obligations were made in reasonable
6 reliance on the abatement of real property taxes that are
7 applicable to the construction, renovation, or
8 rehabilitation of the improvements; and
9 (4) that any business enterprise or individual
10 claiming the right to such an abatement shall submit, in
11 writing, to the municipality, within 30 days after the
12 last date of publication of the notice, information that
13 substantiates the right to receive the tax abatement.
14 Section 10. The Property Tax Code is amended by changing
15 Section 18-170 as follows:
16 (35 ILCS 200/18-170)
17 Sec. 18-170. Enterprise zone abatement. In addition to
18 the authority to abate taxes under Section 18-165, any taxing
19 district, upon a majority vote of its governing authority,
20 may order the county clerk to abate any portion of its taxes
21 on property, or any class thereof, located within an
22 Enterprise Zone created under the Illinois Enterprise Zone
23 Act, and upon which either new improvements have been
24 constructed or existing improvements have been renovated or
25 rehabilitated after December 7, 1982. However, any abatement
26 of taxes on any parcel shall not exceed the amount
27 attributable to the construction of the improvements and the
28 renovation or rehabilitation of existing improvements on the
29 parcel. In the case of property within a redevelopment area
30 created under the Tax Increment Allocation Redevelopment Act,
31 the abatement shall not apply unless a business enterprise or
32 individual, with regard to new improvements or renovated or
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1 rehabilitated improvements, has met the requirements of
2 Section 5.4.1 of the Illinois Enterprise Zone Act exceed the
3 amount of taxes allocable to the taxing district. If an
4 abatement is granted or discontinued under this Section, a
5 municipality shall notify the county clerk and the board of
6 review or board of appeals of the change in writing not later
7 than July 1 of the assessment year to be first affected by
8 the change. However, within a county economic development
9 project area created under the County Economic Development
10 Project Area Property Tax Allocation Act, any municipality or
11 county which has adopted tax increment allocation financing
12 under the Tax Increment Allocation Redevelopment Act or the
13 County Economic Development Project Area Tax Increment
14 Allocation Act may abate any portion of its taxes as provided
15 in this Section. Any other taxing district within the county
16 economic development project area may order any portion or
17 all of its taxes abated as provided above if the county or
18 municipality which created the tax increment district has
19 agreed, in writing, to the abatement.
20 A copy of an abatement order adopted under this Section
21 shall be delivered to the county clerk and to the board of
22 review or board of appeals not later than July 1 of the
23 assessment year to be first affected by the order. If it is
24 delivered on or after that date, it will first affect the
25 taxes extended on the assessment of the following year. The
26 board of review or board of appeals shall, each time the
27 assessment books are delivered to the county clerk, also
28 deliver a list of parcels affected by an abatement and the
29 assessed value attributable to new improvements or to the
30 renovation or rehabilitation of existing improvements.
31 (Source: P.A. 88-455; 89-126, eff. 7-11-95; 89-671, eff.
32 8-14-96.)
33 Section 15. The Illinois Municipal Code is amended by
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1 changing Sections 11-74.4-6 and 11-74.4-8a and adding Section
2 11-74.4-8c as follows:
3 (65 ILCS 5/11-74.4-6) (from Ch. 24, par. 11-74.4-6)
4 Sec. 11-74.4-6. (a) Except as provided herein, notice of
5 the public hearing shall be given by publication and mailing.
6 Notice by publication shall be given by publication at least
7 twice, the first publication to be not more than 30 nor less
8 than 10 days prior to the hearing in a newspaper of general
9 circulation within the taxing districts having property in
10 the proposed redevelopment project area. Notice by mailing
11 shall be given by depositing such notice in the United States
12 mails by certified mail addressed to the person or persons
13 in whose name the general taxes for the last preceding year
14 were paid on each lot, block, tract, or parcel of land lying
15 within the project redevelopment area. Said notice shall be
16 mailed not less than 10 days prior to the date set for the
17 public hearing. In the event taxes for the last preceding
18 year were not paid, the notice shall also be sent to the
19 persons last listed on the tax rolls within the preceding 3
20 years as the owners of such property.
21 (b) The notices issued pursuant to this Section shall
22 include the following:
23 (1) The time and place of public hearing;
24 (2) The boundaries of the proposed redevelopment
25 project area by legal description and by street location
26 where possible;
27 (3) A notification that all interested persons will
28 be given an opportunity to be heard at the public
29 hearing;
30 (4) A description of the redevelopment plan or
31 redevelopment project for the proposed redevelopment
32 project area if a plan or project is the subject matter
33 of the hearing.
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1 (5) Such other matters as the municipality may deem
2 appropriate.
3 (b-5) If the proposed redevelopment project area lies
4 wholly or partially within an enterprise zone, the notice
5 required in subsection (a) shall also include the following:
6 (1) the legal description and street location, if
7 possible, of property located in the enterprise zone and
8 the redevelopment project area;
9 (2) that any improvement, rehabilitation, or
10 renovation constructed in the described area shall not be
11 eligible for a tax abatement under Section 18-170 of the
12 Property Tax Code unless (i) the improvement,
13 rehabilitation, or renovation was committed to before the
14 date of the adoption of tax increment financing by the
15 municipality, (ii) substantial and binding financial
16 obligations were made toward the construction,
17 renovation, or rehabilitation of the improvements before
18 the date of the adoption of tax increment financing by
19 the municipality, and (iii) those commitments and
20 obligations were made in reasonable reliance on the
21 abatement of real property taxes that are applicable to
22 the construction, renovation, or rehabilitation of the
23 improvements; and
24 (3) that any business enterprise or individual who
25 claims the right to receive or continue to receive tax
26 abatements under Section 18-170 of the Property Tax Code
27 must submit, in writing, to the municipality, within 30
28 days after the last date of publication, information that
29 substantiates the right to receive the tax abatement.
30 (c) Not less than 45 days prior to the date set for
31 hearing, the municipality shall give notice by mail as
32 provided in subsection (a) to all taxing districts of which
33 taxable property is included in the redevelopment project
34 area, project or plan and to the Department of Commerce and
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1 Community Affairs, and in addition to the other requirements
2 under subsection (b) the notice shall include an invitation
3 to the Department of Commerce and Community Affairs and each
4 taxing district to submit comments to the municipality
5 concerning the subject matter of the hearing prior to the
6 date of hearing.
7 (d) In the event that any municipality has by ordinance
8 adopted tax increment financing prior to 1987, and has
9 complied with the notice requirements of this Section, except
10 that the notice has not included the requirements of
11 subsection (b), paragraphs (2), (3) and (4), and within 90
12 days of the effective date of this amendatory Act of 1991,
13 that municipality passes an ordinance which contains findings
14 that: (1) all taxing districts prior to the time of the
15 hearing required by Section 11-74.4-5 were furnished with
16 copies of a map incorporated into the redevelopment plan and
17 project substantially showing the legal boundaries of the
18 redevelopment project area; (2) the redevelopment plan and
19 project, or a draft thereof, contained a map substantially
20 showing the legal boundaries of the redevelopment project
21 area and was available to the public at the time of the
22 hearing; and (3) since the adoption of any form of tax
23 increment financing authorized by this Act, and prior to June
24 1, 1991, no objection or challenge has been made in writing
25 to the municipality in respect to the notices required by
26 this Section, then the municipality shall be deemed to have
27 met the notice requirements of this Act and all actions of
28 the municipality taken in connection with such notices as
29 were given are hereby validated and hereby declared to be
30 legally sufficient for all purposes of this Act.
31 (Source: P.A. 86-142; 87-813.)
32 (65 ILCS 5/11-74.4-8a) (from Ch. 24, par. 11-74.4-8a)
33 Sec. 11-74.4-8a. (1) Until June 1, 1988, a municipality
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1 which has adopted tax increment allocation financing prior to
2 January 1, 1987, may by ordinance (1) authorize the
3 Department of Revenue, subject to appropriation, to annually
4 certify and cause to be paid from the Illinois Tax Increment
5 Fund to such municipality for deposit in the municipality's
6 special tax allocation fund an amount equal to the Net State
7 Sales Tax Increment and (2) authorize the Department of
8 Revenue to annually notify the municipality of the amount of
9 the Municipal Sales Tax Increment which shall be deposited by
10 the municipality in the municipality's special tax allocation
11 fund. Provided that for purposes of this Section no
12 amendments adding additional area to the redevelopment
13 project area which has been certified as the State Sales Tax
14 Boundary shall be taken into account if such amendments are
15 adopted by the municipality after January 1, 1987. If an
16 amendment is adopted which decreases the area of a State
17 Sales Tax Boundary, the municipality shall update the list
18 required by subsection (3)(a) of this Section. The Retailers'
19 Occupation Tax liability, Use Tax liability, Service
20 Occupation Tax liability and Service Use Tax liability for
21 retailers and servicemen located within the disconnected area
22 shall be excluded from the base from which tax increments are
23 calculated and the revenue from any such retailer or
24 serviceman shall not be included in calculating incremental
25 revenue payable to the municipality. A municipality adopting
26 an ordinance under this subsection (1) of this Section for a
27 redevelopment project area which is certified as a State
28 Sales Tax Boundary shall not be entitled to payments of State
29 taxes authorized under subsection (2) of this Section for the
30 same redevelopment project area. Nothing herein shall be
31 construed to prevent a municipality from receiving payment of
32 State taxes authorized under subsection (2) of this Section
33 for a separate redevelopment project area that does not
34 overlap in any way with the State Sales Tax Boundary
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1 receiving payments of State taxes pursuant to subsection (1)
2 of this Section.
3 A certified copy of such ordinance shall be submitted by
4 the municipality to the Department of Commerce and Community
5 Affairs and the Department of Revenue not later than 30 days
6 after the effective date of the ordinance. Upon submission
7 of the ordinances, and the information required pursuant to
8 subsection 3 of this Section, the Department of Revenue shall
9 promptly determine the amount of such taxes paid under the
10 Retailers' Occupation Tax Act, Use Tax Act, Service Use Tax
11 Act, the Service Occupation Tax Act, the Municipal Retailers'
12 Occupation Tax Act and the Municipal Service Occupation Tax
13 Act by retailers and servicemen on transactions at places
14 located in the redevelopment project area during the base
15 year, and shall certify all the foregoing "initial sales tax
16 amounts" to the municipality within 60 days of submission of
17 the list required of subsection (3)(a) of this Section.
18 If a retailer or serviceman with a place of business
19 located within a redevelopment project area also has one or
20 more other places of business within the municipality but
21 outside the redevelopment project area, the retailer or
22 serviceman shall, upon request of the Department of Revenue,
23 certify to the Department of Revenue the amount of taxes paid
24 pursuant to the Retailers' Occupation Tax Act, the Municipal
25 Retailers' Occupation Tax Act, the Service Occupation Tax Act
26 and the Municipal Service Occupation Tax Act at each place of
27 business which is located within the redevelopment project
28 area in the manner and for the periods of time requested by
29 the Department of Revenue.
30 When the municipality determines that a portion of an
31 increase in the aggregate amount of taxes paid by retailers
32 and servicemen under the Retailers' Occupation Tax Act, Use
33 Tax Act, Service Use Tax Act, or the Service Occupation Tax
34 Act is the result of a retailer or serviceman initiating
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1 retail or service operations in the redevelopment project
2 area by such retailer or serviceman with a resulting
3 termination of retail or service operations by such retailer
4 or serviceman at another location in Illinois in the standard
5 metropolitan statistical area of such municipality, the
6 Department of Revenue shall be notified that the retailers
7 occupation tax liability, use tax liability, service
8 occupation tax liability, or service use tax liability from
9 such retailer's or serviceman's terminated operation shall be
10 included in the base Initial Sales Tax Amounts from which the
11 State Sales Tax Increment is calculated for purposes of State
12 payments to the affected municipality; provided, however, for
13 purposes of this paragraph "termination" shall mean a closing
14 of a retail or service operation which is directly related to
15 the opening of the same retail or service operation in a
16 redevelopment project area which is included within a State
17 Sales Tax Boundary, but it shall not include retail or
18 service operations closed for reasons beyond the control of
19 the retailer or serviceman, as determined by the Department.
20 If the municipality makes the determination referred to in
21 the prior paragraph and notifies the Department and if the
22 relocation is from a location within the municipality, the
23 Department, at the request of the municipality, shall adjust
24 the certified aggregate amount of taxes that constitute the
25 Municipal Sales Tax Increment paid by retailers and
26 servicemen on transactions at places of business located
27 within the State Sales Tax Boundary during the base year
28 using the same procedures as are employed to make the
29 adjustment referred to in the prior paragraph. The adjusted
30 Municipal Sales Tax Increment calculated by the Department
31 shall be sufficient to satisfy the requirements of subsection
32 (1) of this Section.
33 When a municipality which has adopted tax increment
34 allocation financing in 1986 determines that a portion of the
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1 aggregate amount of taxes paid by retailers and servicemen
2 under the Retailers Occupation Tax Act, Use Tax Act, Service
3 Use Tax Act, or Service Occupation Tax Act, the Municipal
4 Retailers' Occupation Tax Act and the Municipal Service
5 Occupation Tax Act, includes revenue of a retailer or
6 serviceman which terminated retailer or service operations in
7 1986, prior to the adoption of tax increment allocation
8 financing, the Department of Revenue shall be notified by
9 such municipality that the retailers' occupation tax
10 liability, use tax liability, service occupation tax
11 liability or service use tax liability, from such retailer's
12 or serviceman's terminated operations shall be excluded from
13 the Initial Sales Tax Amounts for such taxes. The revenue
14 from any such retailer or serviceman which is excluded from
15 the base year under this paragraph, shall not be included in
16 calculating incremental revenues if such retailer or
17 serviceman reestablishes such business in the redevelopment
18 project area.
19 For State fiscal year 1992, the Department of Revenue
20 shall budget, and the Illinois General Assembly shall
21 appropriate from the Illinois Tax Increment Fund in the State
22 treasury, an amount not to exceed $18,000,000 to pay to each
23 eligible municipality the Net State Sales Tax Increment to
24 which such municipality is entitled.
25 Beginning on January 1, 1993, each municipality's
26 proportional share of the Illinois Tax Increment Fund shall
27 be determined by adding the annual Net State Sales Tax
28 Increment and the annual Net Utility Tax Increment to
29 determine the Annual Total Increment. The ratio of the Annual
30 Total Increment of each municipality to the Annual Total
31 Increment for all municipalities, as most recently calculated
32 by the Department, shall determine the proportional shares of
33 the Illinois Tax Increment Fund to be distributed to each
34 municipality.
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1 Beginning in October, 1993, and each January, April, July
2 and October thereafter, the Department of Revenue shall
3 certify to the Treasurer and the Comptroller the amounts
4 payable quarter annually during the fiscal year to each
5 municipality under this Section. The Comptroller shall
6 promptly then draw warrants, ordering the State Treasurer to
7 pay such amounts from the Illinois Tax Increment Fund in the
8 State treasury.
9 The Department of Revenue shall utilize the same periods
10 established for determining State Sales Tax Increment to
11 determine the Municipal Sales Tax Increment for the area
12 within a State Sales Tax Boundary and certify such amounts to
13 such municipal treasurer who shall transfer such amounts to
14 the special tax allocation fund.
15 The provisions of this subsection (1) do not apply to
16 additional municipal retailers' occupation or service
17 occupation taxes imposed by municipalities using their home
18 rule powers or imposed pursuant to Sections 8-11-1.3,
19 8-11-1.4 and 8-11-1.5 of this Act. A municipality shall not
20 receive from the State any share of the Illinois Tax
21 Increment Fund unless such municipality deposits all its
22 Municipal Sales Tax Increment and the local incremental real
23 property tax revenues, as provided herein, into the
24 appropriate special tax allocation fund. A municipality
25 located within an economic development project area created
26 under the County Economic Development Project Area Property
27 Tax Allocation Act which has abated any portion of its
28 property taxes which otherwise would have been deposited in
29 its special tax allocation fund shall not receive from the
30 State the Net Sales Tax Increment.
31 (2) A municipality which has adopted tax increment
32 allocation financing with regard to an industrial park or
33 industrial park conservation area, prior to January 1, 1988,
34 may by ordinance authorize the Department of Revenue to
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1 annually certify and pay from the Illinois Tax Increment Fund
2 to such municipality for deposit in the municipality's
3 special tax allocation fund an amount equal to the Net State
4 Utility Tax Increment. Provided that for purposes of this
5 Section no amendments adding additional area to the
6 redevelopment project area shall be taken into account if
7 such amendments are adopted by the municipality after January
8 1, 1988. Municipalities adopting an ordinance under this
9 subsection (2) of this Section for a redevelopment project
10 area shall not be entitled to payment of State taxes
11 authorized under subsection (1) of this Section for the same
12 redevelopment project area which is within a State Sales Tax
13 Boundary. Nothing herein shall be construed to prevent a
14 municipality from receiving payment of State taxes authorized
15 under subsection (1) of this Section for a separate
16 redevelopment project area within a State Sales Tax Boundary
17 that does not overlap in any way with the redevelopment
18 project area receiving payments of State taxes pursuant to
19 subsection (2) of this Section.
20 A certified copy of such ordinance shall be submitted to
21 the Department of Commerce and Community Affairs and the
22 Department of Revenue not later than 30 days after the
23 effective date of the ordinance.
24 When a municipality determines that a portion of an
25 increase in the aggregate amount of taxes paid by industrial
26 or commercial facilities under the Public Utilities Act, is
27 the result of an industrial or commercial facility initiating
28 operations in the redevelopment project area with a resulting
29 termination of such operations by such industrial or
30 commercial facility at another location in Illinois, the
31 Department of Revenue shall be notified by such municipality
32 that such industrial or commercial facility's liability under
33 the Public Utility Tax Act shall be included in the base from
34 which tax increments are calculated for purposes of State
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1 payments to the affected municipality.
2 After receipt of the calculations by the public utility
3 as required by subsection (4) of this Section, the Department
4 of Revenue shall annually budget and the Illinois General
5 Assembly shall annually appropriate from the General Revenue
6 Fund through State Fiscal Year 1989, and thereafter from the
7 Illinois Tax Increment Fund, an amount sufficient to pay to
8 each eligible municipality the amount of incremental revenue
9 attributable to State electric and gas taxes as reflected by
10 the charges imposed on persons in the project area to which
11 such municipality is entitled by comparing the preceding
12 calendar year with the base year as determined by this
13 Section. Beginning on January 1, 1993, each municipality's
14 proportional share of the Illinois Tax Increment Fund shall
15 be determined by adding the annual Net State Utility Tax
16 Increment and the annual Net Utility Tax Increment to
17 determine the Annual Total Increment. The ratio of the Annual
18 Total Increment of each municipality to the Annual Total
19 Increment for all municipalities, as most recently calculated
20 by the Department, shall determine the proportional shares of
21 the Illinois Tax Increment Fund to be distributed to each
22 municipality.
23 A municipality shall not receive any share of the
24 Illinois Tax Increment Fund from the State unless such
25 municipality imposes the maximum municipal charges authorized
26 pursuant to Section 9-221 of the Public Utilities Act and
27 deposits all municipal utility tax incremental revenues as
28 certified by the public utilities, and all local real estate
29 tax increments into such municipality's special tax
30 allocation fund.
31 (3) Within 30 days after the adoption of the ordinance
32 required by either subsection (1) or subsection (2) of this
33 Section, the municipality shall transmit to the Department of
34 Commerce and Community Affairs and the Department of Revenue
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1 the following:
2 (a) if applicable, a certified copy of the
3 ordinance required by subsection (1) accompanied by a
4 complete list of street names and the range of street
5 numbers of each street located within the redevelopment
6 project area for which payments are to be made under this
7 Section in both the base year and in the year preceding
8 the payment year; and the addresses of persons registered
9 with the Department of Revenue; and, the name under which
10 each such retailer or serviceman conducts business at
11 that address, if different from the corporate name; and
12 the Illinois Business Tax Number of each such person (The
13 municipality shall update this list in the event of a
14 revision of the redevelopment project area, or the
15 opening or closing or name change of any street or part
16 thereof in the redevelopment project area, or if the
17 Department of Revenue informs the municipality of an
18 addition or deletion pursuant to the monthly updates
19 given by the Department.);
20 (b) if applicable, a certified copy of the
21 ordinance required by subsection (2) accompanied by a
22 complete list of street names and range of street numbers
23 of each street located within the redevelopment project
24 area, the utility customers in the project area, and the
25 utilities serving the redevelopment project areas;
26 (c) certified copies of the ordinances approving
27 the redevelopment plan and designating the redevelopment
28 project area;
29 (d) a copy of the redevelopment plan as approved by
30 the municipality;
31 (e) an opinion of legal counsel that the
32 municipality had complied with the requirements of this
33 Act; and
34 (f) a certification by the chief executive officer
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1 of the municipality that with regard to a redevelopment
2 project area: (1) the municipality has committed all of
3 the municipal tax increment created pursuant to this Act
4 for deposit in the special tax allocation fund, (2) the
5 redevelopment projects described in the redevelopment
6 plan would not be completed without the use of State
7 incremental revenues pursuant to this Act, (3) the
8 municipality will pursue the implementation of the
9 redevelopment plan in an expeditious manner, (4) the
10 incremental revenues created pursuant to this Section
11 will be exclusively utilized for the development of the
12 redevelopment project area, and (5) the increased revenue
13 created pursuant to this Section shall be used
14 exclusively to pay redevelopment project costs as defined
15 in this Act.
16 (4) The Department of Revenue upon receipt of the
17 information set forth in paragraph (b) of subsection (3)
18 shall immediately forward such information to each public
19 utility furnishing natural gas or electricity to buildings
20 within the redevelopment project area. Upon receipt of such
21 information, each public utility shall promptly:
22 (a) provide to the Department of Revenue and the
23 municipality separate lists of the names and addresses of
24 persons within the redevelopment project area receiving
25 natural gas or electricity from such public utility.
26 Such list shall be updated as necessary by the public
27 utility. Each month thereafter the public utility shall
28 furnish the Department of Revenue and the municipality
29 with an itemized listing of charges imposed pursuant to
30 Sections 9-221 and 9-222 of the Public Utilities Act on
31 persons within the redevelopment project area.
32 (b) determine the amount of charges imposed
33 pursuant to Sections 9-221 and 9-222 of the Public
34 Utilities Act on persons in the redevelopment project
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1 area during the base year, both as a result of municipal
2 taxes on electricity and gas and as a result of State
3 taxes on electricity and gas and certify such amounts
4 both to the municipality and the Department of Revenue;
5 and
6 (c) determine the amount of charges imposed
7 pursuant to Sections 9-221 and 9-222 of the Public
8 Utilities Act on persons in the redevelopment project
9 area on a monthly basis during the base year, both as a
10 result of State and municipal taxes on electricity and
11 gas and certify such separate amounts both to the
12 municipality and the Department of Revenue.
13 After the determinations are made in paragraphs (b) and
14 (c), the public utility shall monthly during the existence of
15 the redevelopment project area notify the Department of
16 Revenue and the municipality of any increase in charges over
17 the base year determinations made pursuant to paragraphs (b)
18 and (c).
19 (5) The payments authorized under this Section shall be
20 deposited by the municipal treasurer in the special tax
21 allocation fund of the municipality, which for accounting
22 purposes shall identify the sources of each payment as:
23 municipal receipts from the State retailers occupation,
24 service occupation, use and service use taxes; and municipal
25 public utility taxes charged to customers under the Public
26 Utilities Act and State public utility taxes charged to
27 customers under the Public Utilities Act.
28 (6) Any municipality receiving payments authorized under
29 this Section for any redevelopment project area or area
30 within a State Sales Tax Boundary within the municipality
31 shall submit to the Department of Revenue and to the taxing
32 districts which are sent the notice required by Section 6 of
33 this Act annually within 180 days after the close of each
34 municipal fiscal year the following information for the
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1 immediately preceding fiscal year:
2 (a) Any amendments to the redevelopment plan, the
3 redevelopment project area, or the State Sales Tax
4 Boundary.
5 (b) Audited financial statements of the special tax
6 allocation fund.
7 (c) Certification of the Chief Executive Officer of
8 the municipality that the municipality has complied with
9 all of the requirements of this Act during the preceding
10 fiscal year.
11 (d) An opinion of legal counsel that the
12 municipality is in compliance with this Act.
13 (e) An analysis of the special tax allocation fund
14 which sets forth:
15 (1) the balance in the special tax allocation
16 fund at the beginning of the fiscal year;
17 (2) all amounts deposited in the special tax
18 allocation fund by source;
19 (3) all expenditures from the special tax
20 allocation fund by category of permissible
21 redevelopment project cost; and
22 (4) the balance in the special tax allocation
23 fund at the end of the fiscal year including a
24 breakdown of that balance by source. Such ending
25 balance shall be designated as surplus if it is not
26 required for anticipated redevelopment project costs
27 or to pay debt service on bonds issued to finance
28 redevelopment project costs, as set forth in Section
29 11-74.4-7 hereof.
30 (f) A description of all property purchased by the
31 municipality within the redevelopment project area
32 including
33 1. Street address
34 2. Approximate size or description of property
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1 3. Purchase price
2 4. Seller of property.
3 (g) A statement setting forth all activities
4 undertaken in furtherance of the objectives of the
5 redevelopment plan, including:
6 1. Any project implemented in the preceding
7 fiscal year
8 2. A description of the redevelopment
9 activities undertaken
10 3. A description of any agreements entered
11 into by the municipality with regard to the
12 disposition or redevelopment of any property within
13 the redevelopment project area or the area within
14 the State Sales Tax Boundary.
15 (h) With regard to any obligations issued by the
16 municipality:
17 1. copies of bond ordinances or resolutions
18 2. copies of any official statements
19 3. an analysis prepared by financial advisor
20 or underwriter setting forth: (a) nature and term of
21 obligation; and (b) projected debt service including
22 required reserves and debt coverage.
23 (i) A certified audit report reviewing compliance
24 with this statute performed by an independent public
25 accountant certified and licensed by the authority of the
26 State of Illinois. The financial portion of the audit
27 must be conducted in accordance with Standards for Audits
28 of Governmental Organizations, Programs, Activities, and
29 Functions adopted by the Comptroller General of the
30 United States (1981), as amended. The audit report shall
31 contain a letter from the independent certified public
32 accountant indicating compliance or noncompliance with
33 the requirements of subsection (q) of Section 11-74.4-3.
34 If the audit indicates that expenditures are not in
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1 compliance with the law, the Department of Revenue shall
2 withhold State sales and utility tax increment payments
3 to the municipality until compliance has been reached,
4 and an amount equal to the ineligible expenditures has
5 been returned to the Special Tax Allocation Fund.
6 (6.1) After July 29, 1988, any funds which have not been
7 designated for use in a specific development project in the
8 annual report shall be designated as surplus. No funds may be
9 held in the Special Tax Allocation Fund for more than 36
10 months from the date of receipt unless the money is required
11 for payment of contractual obligations for specific
12 development project costs. If held for more than 36 months in
13 violation of the preceding sentence, such funds shall be
14 designated as surplus. Any funds designated as surplus must
15 first be used for early redemption of any bond obligations.
16 Any funds designated as surplus which are not disposed of as
17 otherwise provided in this paragraph, shall be distributed as
18 surplus as provided in Section 11-74.4-7.
19 (7) Any appropriation made pursuant to this Section for
20 the 1987 State fiscal year shall not exceed the amount of $7
21 million and for the 1988 State fiscal year the amount of $10
22 million. The amount which shall be distributed to each
23 municipality shall be the incremental revenue to which each
24 municipality is entitled as calculated by the Department of
25 Revenue, unless the requests of the municipality exceed the
26 appropriation, then the amount to which each municipality
27 shall be entitled shall be prorated among the municipalities
28 in the same proportion as the increment to which the
29 municipality would be entitled bears to the total increment
30 which all municipalities would receive in the absence of this
31 limitation, provided that no municipality may receive an
32 amount in excess of 15% of the appropriation. For the 1987
33 Net State Sales Tax Increment payable in Fiscal Year 1989, no
34 municipality shall receive more than 7.5% of the total
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1 appropriation; provided, however, that any of the
2 appropriation remaining after such distribution shall be
3 prorated among municipalities on the basis of their pro rata
4 share of the total increment. Beginning on January 1, 1993,
5 each municipality's proportional share of the Illinois Tax
6 Increment Fund shall be determined by adding the annual Net
7 State Sales Tax Increment and the annual Net Utility Tax
8 Increment to determine the Annual Total Increment. The ratio
9 of the Annual Total Increment of each municipality to the
10 Annual Total Increment for all municipalities, as most
11 recently calculated by the Department, shall determine the
12 proportional shares of the Illinois Tax Increment Fund to be
13 distributed to each municipality.
14 (7.1) No distribution of Net State Sales Tax Increment
15 to a municipality for an area within a State Sales Tax
16 Boundary shall exceed in any State Fiscal Year an amount
17 equal to 3 times the sum of the Municipal Sales Tax
18 Increment, the real property tax increment and deposits of
19 funds from other sources, excluding state and federal funds,
20 as certified by the city treasurer to the Department of
21 Revenue for an area within a State Sales Tax Boundary. After
22 July 29, 1988, for those municipalities which issue bonds
23 between June 1, 1988 and 3 years from July 29, 1988 to
24 finance redevelopment projects within the area in a State
25 Sales Tax Boundary, the distribution of Net State Sales Tax
26 Increment during the 16th through 20th years from the date of
27 issuance of the bonds shall not exceed in any State Fiscal
28 Year an amount equal to 2 times the sum of the Municipal
29 Sales Tax Increment, the real property tax increment and
30 deposits of funds from other sources, excluding State and
31 federal funds.
32 (8) Any person who knowingly files or causes to be filed
33 false information for the purpose of increasing the amount of
34 any State tax incremental revenue commits a Class A
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1 misdemeanor.
2 (9) The following procedures shall be followed to
3 determine whether municipalities have complied with the Act
4 for the purpose of receiving distributions after July 1, 1989
5 pursuant to subsection (1) of this Section 11-74.4-8a.
6 (a) The Department of Revenue shall conduct a
7 preliminary review of the redevelopment project areas and
8 redevelopment plans pertaining to those municipalities
9 receiving payments from the State pursuant to subsection
10 (1) of Section 8a of this Act for the purpose of
11 determining compliance with the following standards:
12 (1) For any municipality with a population of
13 more than 12,000 as determined by the 1980 U.S.
14 Census: (a) the redevelopment project area, or in
15 the case of a municipality which has more than one
16 redevelopment project area, each such area, must be
17 contiguous and the total of all such areas shall not
18 comprise more than 25% of the area within the
19 municipal boundaries nor more than 20% of the
20 equalized assessed value of the municipality; (b)
21 the aggregate amount of 1985 taxes in the
22 redevelopment project area, or in the case of a
23 municipality which has more than one redevelopment
24 project area, the total of all such areas, shall be
25 not more than 25% of the total base year taxes paid
26 by retailers and servicemen on transactions at
27 places of business located within the municipality
28 under the Retailers' Occupation Tax Act, the Use Tax
29 Act, the Service Use Tax Act, and the Service
30 Occupation Tax Act. Redevelopment project areas
31 created prior to 1986 are not subject to the above
32 standards if their boundaries were not amended in
33 1986.
34 (2) For any municipality with a population of
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1 12,000 or less as determined by the 1980 U.S.
2 Census: (a) the redevelopment project area, or in
3 the case of a municipality which has more than one
4 redevelopment project area, each such area, must be
5 contiguous and the total of all such areas shall not
6 comprise more than 35% of the area within the
7 municipal boundaries nor more than 30% of the
8 equalized assessed value of the municipality; (b)
9 the aggregate amount of 1985 taxes in the
10 redevelopment project area, or in the case of a
11 municipality which has more than one redevelopment
12 project area, the total of all such areas, shall not
13 be more than 35% of the total base year taxes paid
14 by retailers and servicemen on transactions at
15 places of business located within the municipality
16 under the Retailers' Occupation Tax Act, the Use Tax
17 Act, the Service Use Tax Act, and the Service
18 Occupation Tax Act. Redevelopment project areas
19 created prior to 1986 are not subject to the above
20 standards if their boundaries were not amended in
21 1986.
22 (3) Such preliminary review of the
23 redevelopment project areas applying the above
24 standards shall be completed by November 1, 1988,
25 and on or before November 1, 1988, the Department
26 shall notify each municipality by certified mail,
27 return receipt requested that either (1) the
28 Department requires additional time in which to
29 complete its preliminary review; or (2) the
30 Department is issuing either (a) a Certificate of
31 Eligibility or (b) a Notice of Review. If the
32 Department notifies a municipality that it requires
33 additional time to complete its preliminary
34 investigation, it shall complete its preliminary
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1 investigation no later than February 1, 1989, and by
2 February 1, 1989 shall issue to each municipality
3 either (a) a Certificate of Eligibility or (b) a
4 Notice of Review. A redevelopment project area for
5 which a Certificate of Eligibility has been issued
6 shall be deemed a "State Sales Tax Boundary."
7 (4) The Department of Revenue shall also issue
8 a Notice of Review if the Department has received a
9 request by November 1, 1988 to conduct such a review
10 from taxpayers in the municipality, local taxing
11 districts located in the municipality or the State
12 of Illinois, or if the redevelopment project area
13 has more than 5 retailers and has had growth in
14 State sales tax revenue of more than 15% from
15 calendar year 1985 to 1986.
16 (b) For those municipalities receiving a Notice of
17 Review, the Department will conduct a secondary review
18 consisting of: (i) application of the above standards
19 contained in subsection (9)(a)(1)(a) and (b) or
20 (9)(a)(2)(a) and (b), and (ii) the definitions of
21 blighted and conservation area provided for in Section
22 11-74.4-3. Such secondary review shall be completed by
23 July 1, 1989.
24 Upon completion of the secondary review, the
25 Department will issue (a) a Certificate of Eligibility or
26 (b) a Preliminary Notice of Deficiency. Any municipality
27 receiving a Preliminary Notice of Deficiency may amend
28 its redevelopment project area to meet the standards and
29 definitions set forth in this paragraph (b). This amended
30 redevelopment project area shall become the "State Sales
31 Tax Boundary" for purposes of determining the State Sales
32 Tax Increment.
33 (c) If the municipality advises the Department of
34 its intent to comply with the requirements of paragraph
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1 (b) of this subsection outlined in the Preliminary Notice
2 of Deficiency, within 120 days of receiving such notice
3 from the Department, the municipality shall submit
4 documentation to the Department of the actions it has
5 taken to cure any deficiencies. Thereafter, within 30
6 days of the receipt of the documentation, the Department
7 shall either issue a Certificate of Eligibility or a
8 Final Notice of Deficiency. If the municipality fails to
9 advise the Department of its intent to comply or fails to
10 submit adequate documentation of such cure of
11 deficiencies the Department shall issue a Final Notice of
12 Deficiency that provides that the municipality is
13 ineligible for payment of the Net State Sales Tax
14 Increment.
15 (d) If the Department issues a final determination
16 of ineligibility, the municipality shall have 30 days
17 from the receipt of determination to protest and request
18 a hearing. Such hearing shall be conducted in accordance
19 with Sections 10-25, 10-35, 10-40, and 10-50 of the
20 Illinois Administrative Procedure Act. The decision
21 following the hearing shall be subject to review under
22 the Administrative Review Law.
23 (e) Any Certificate of Eligibility issued pursuant
24 to this subsection 9 shall be binding only on the State
25 for the purposes of establishing municipal eligibility to
26 receive revenue pursuant to subsection (1) of this
27 Section 11-74.4-8a.
28 (f) It is the intent of this subsection that the
29 periods of time to cure deficiencies shall be in addition
30 to all other periods of time permitted by this Section,
31 regardless of the date by which plans were originally
32 required to be adopted. To cure said deficiencies,
33 however, the municipality shall be required to follow the
34 procedures and requirements pertaining to amendments, as
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1 provided in Sections 11-74.4-5 and 11-74.4-6 of this Act.
2 (10) If a municipality adopts a State Sales Tax Boundary
3 in accordance with the provisions of subsection (9) of this
4 Section, such boundaries shall subsequently be utilized to
5 determine Revised Initial Sales Tax Amounts and the Net State
6 Sales Tax Increment; provided, however, that such revised
7 State Sales Tax Boundary shall not have any effect upon the
8 boundary of the redevelopment project area established for
9 the purposes of determining the ad valorem taxes on real
10 property pursuant to Sections 11-74.4-7 and 11-74.4-8 of this
11 Act nor upon the municipality's authority to implement the
12 redevelopment plan for that redevelopment project area. For
13 any redevelopment project area with a smaller State Sales Tax
14 Boundary within its area, the municipality may annually elect
15 to deposit the Municipal Sales Tax Increment for the
16 redevelopment project area in the special tax allocation fund
17 and shall certify the amount to the Department prior to
18 receipt of the Net State Sales Tax Increment. Any
19 municipality required by subsection (9) to establish a State
20 Sales Tax Boundary for one or more of its redevelopment
21 project areas shall submit all necessary information required
22 by the Department concerning such boundary and the retailers
23 therein, by October 1, 1989, after complying with the
24 procedures for amendment set forth in Sections 11-74.4-5 and
25 11-74.4-6 of this Act. Net State Sales Tax Increment
26 produced within the State Sales Tax Boundary shall be spent
27 only within that area. However expenditures of all municipal
28 property tax increment and municipal sales tax increment in a
29 redevelopment project area are not required to be spent
30 within the smaller State Sales Tax Boundary within such
31 redevelopment project area.
32 (11) The Department of Revenue shall have the authority
33 to issue rules and regulations for purposes of this Section.
34 (12) If, under Section 5.4.1 of the Illinois Enterprise
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1 Zone Act, a municipality determines that property that lies
2 within a State Sales Tax Boundary has an improvement,
3 rehabilitation, or renovation that is entitled to a property
4 tax abatement, then that property along with any
5 improvements, rehabilitations, or renovations shall be
6 immediately removed from any State Sales Tax Boundary. The
7 municipality that made the determination shall notify the
8 Department of Revenue within 30 days after the determination.
9 (Source: P.A. 87-14; 87-1258; 87-1272; 88-45.)
10 (65 ILCS 5/11-74.4-8c new)
11 Sec. 11-74.4-8c. Enterprise zone abatements. If a
12 redevelopment project area is or has been established under
13 Section 11-74.4-4 on or before the effective date of this
14 amendatory Act of 1997 and the redevelopment project area
15 contains property that is located within an enterprise zone
16 established under the Illinois Enterprise Zone Act, then the
17 property that is located in both the redevelopment project
18 area and the enterprise zone shall not be eligible for the
19 abatement of taxes under Section 18-170 of the Property Tax
20 Code unless the requirements of Section 5.4.1 of the
21 Illinois Enterprise Zone Act are satisfied. If an abatement
22 is granted or discontinued under this Section, a municipality
23 shall notify the county clerk and the board of review or
24 board of appeals of the change in writing not later than July
25 1 of the assessment year to be first affected by the change.
26 Section 90. The State Mandates Act is amended by adding
27 Section 8.21 as follows:
28 (30 ILCS 805/8.21 new)
29 Sec. 8.21. Exempt mandate. Notwithstanding Sections 6
30 and 8 of this Act, no reimbursement by the State is required
31 for the implementation of any mandate created by this
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1 amendatory Act of 1997.
2 Section 95. Severability. The provisions of this Act
3 are severable under Section 1.31 of the Statute on Statutes.
4 Section 99. Effective date. This Act takes effect July
5 1, 1997.
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1 INDEX
2 Statutes amended in order of appearance
3 20 ILCS 655/5.4.1 new
4 35 ILCS 200/18-170
5 65 ILCS 5/11-74.4-6 from Ch. 24, par. 11-74.4-6
6 65 ILCS 5/11-74.4-8a from Ch. 24, par. 11-74.4-8a
7 65 ILCS 5/11-74.4-8c new
8 30 ILCS 805/8.21 new