State of Illinois
90th General Assembly
Legislation

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[ Engrossed ][ Enrolled ][ Senate Amendment 001 ]

90_HB2430

      New Act
      5 ILCS 80/4.19 new
      30 ILCS 105/5.480 new
          Creates the Illinois Petroleum  Education  and  Marketing
      Act  and the Illinois Petroleum Resources Board.  Repeals the
      Board on July 1, 2002.  Provides that the Board shall consist
      of 12 members appointed by the Governor.  Sets out the powers
      and duties of the Board.   Creates  the  Petroleum  Resources
      Revolving  Fund, a continuing fund not subject to fiscal year
      limitations.  Allows the Board to levy an assessment equal to
      one-tenth of 1% of the gross revenues of oil and gas produced
      from each well in the State.  Requires the assessment  to  be
      deducted  from  the  proceeds  of  production  by  the  first
      purchaser  and  remitted  to the Department of Revenue.  Sets
      out the procedures for requesting a refund.  Allows the Board
      to invest funds collected through the assessments.   Provides
      that  this  Act  does not preempt or supersede other State or
      national programs.  Amends the State Finance Act to  add  the
      Petroleum  Resources  Revolving  Fund.  Amends the Regulatory
      Agency Sunset Act to repeal the Illinois Petroleum  Education
      and  Marketing  Act  on  January  1, 2008.  Effective July 1,
      1998.
                                                     LRB9007993DPcw
                                               LRB9007993DPcw
 1        AN ACT to create the  Illinois  Petroleum  Education  and
 2    Marketing Act.
 3        Be  it  enacted  by  the People of the State of Illinois,
 4    represented in the General Assembly:
 5        Section 1.  Short title.  This Act may be  cited  as  the
 6    Illinois Petroleum Education and Marketing Act.
 7        Section 5.  Definitions.  As used in this Act:
 8        "Board" means the Illinois Petroleum Resources Board.
 9        "Person"  means  an  individual,  group  of  individuals,
10    partnership,   corporation,  association,  limited  liability
11    company, cooperative, or any other entity or an  employee  of
12    the entity.
13        "Producer" means a person who produces oil and gas or who
14    derives  a  majority  of  his  or her oil and gas income from
15    working interest.
16        "Qualified producer association" means an entity that  is
17    organized  and operating within the State and that represents
18    oil producers on a Statewide basis.
19        Section 10.  Illinois Petroleum Resources Board.
20        (a)  There is hereby created  until  July  1,  2002,  the
21    Illinois  Petroleum Resources Board which shall be subject to
22    the provisions of the  Regulatory  Agency  Sunset  Act.   The
23    purpose  of  the Board is to coordinate a program designed to
24    demonstrate to the  general  public  the  importance  of  the
25    Illinois   oil   exploration   and  production  industry,  to
26    encourage the wise and efficient use of  energy,  to  promote
27    environmentally sound production methods and technologies, to
28    develop  existing  supplies  of  State  oil resources, and to
29    support research and educational  activities  concerning  the
30    oil exploration and production industry.
                            -2-                LRB9007993DPcw
 1        (b)  The  Board  shall  be  composed  of 12 members to be
 2    appointed  by  the  Governor.   The   Governor   shall   make
 3    appointments  from  a  list  of  names submitted by qualified
 4    producer associations, of which  10  shall  be  oil  and  gas
 5    producers.
 6        (c)  A member of the Board shall:
 7             (1)  be at least 25 years of age;
 8             (2)  be a resident of the State of Illinois; and
 9             (3)  have  at  least 5 years of active experience in
10        the oil industry.
11        (d)  Members shall serve for a term of  3  years,  except
12    that  of  the initial appointments, 4 members shall serve for
13    one year, 4 members for 2 years, and 4 members for 3 years.
14        (e)  Vacancies shall be filled for the unexpired term  of
15    office in the same manner as the original appointment.
16        (f)  The  Board shall, at its first meeting, elect one of
17    its members as chairperson, who shall preside  over  meetings
18    of the Board and perform other duties that may be required by
19    the Board.  The first meeting of the Board shall be called by
20    the Governor.
21        (g)  No  member  of  the  Board shall receive a salary or
22    reimbursement for duties performed as a member of the  Board,
23    except that members are eligible to receive reimbursement for
24    travel expenses incurred in the performance of Board duties.
25        Section  15.  Board  powers  and  duties. The Board shall
26    have the following powers and duties:
27             (1)  To administer and  enforce  the  provisions  of
28        this Act.
29             (2)  To establish an office for the Board within the
30        State of Illinois.
31             (3)  To  elect  a chairperson and any other officers
32        that may be necessary to direct  the  operations  of  the
33        Board.
                            -3-                LRB9007993DPcw
 1             (4)  To   employ   personnel   as  shall  be  deemed
 2        necessary to carry out the purpose and provisions of this
 3        Act  and  to  prescribe  their  duties  and   fix   their
 4        compensation.
 5             (5)  To administer the Petroleum Resources Revolving
 6        Fund.
 7             (6)  To  approve  or  disapprove  the  budget of the
 8        Board.
 9             (7)  To adopt rules as it deems necessary  to  carry
10        out the provisions of this Act.
11             (8)  To  enter  into  contracts  or  agreements  for
12        studies,  research projects, experimental work, supplies,
13        or other services to carry out the purposes of  this  Act
14        and  to incur those expenses necessary to carry out those
15        purposes.  A contract or  agreement  entered  into  under
16        this item shall provide that:
17                  (A)  the   person   entering  the  contract  or
18             agreement on behalf of the Board shall  develop  and
19             submit  to the Board a plan or project together with
20             a budget that shows estimated costs to  be  incurred
21             for the plan or project; and
22                  (B)  the   person   entering  the  contract  or
23             agreement shall keep accurate records of all of  its
24             transactions,   account   for   funds  received  and
25             expended, and make periodic reports to the Board  of
26             activities  conducted  and  other  reports  that the
27             Board may require.
28             (9)  To  keep  accurate  records  of  all  financial
29        transactions  performed  pursuant  to  this  Act.   These
30        records shall  be  audited  annually  by  an  independent
31        auditor  and  an  annual  report  shall  be  compiled and
32        presented to the Governor.
33             (10)  To cooperate with any private,  local,  state,
34        or  national  commission,  organization, agency, or group
                            -4-                LRB9007993DPcw
 1        and to make contracts and agreements for  joint  programs
 2        beneficial to the oil industry.
 3             (11)  To  accept  donations,  grants, contributions,
 4        and gifts from any public or private source  and  deposit
 5        them into the Petroleum Resources Revolving Fund.
 6             (12)  To  approve  or  disapprove  the investment of
 7        moneys into the Petroleum Resources Revolving Fund  under
 8        Section 45 of this Act.
 9             (13)  To  keep an accurate record of all assessments
10        collected.
11        Section 20.  Board meetings; appointment of Director.
12        (a)  There shall be an annual meeting  of  the  Board  at
13    which   the   annual  report  and  proposed  budget  will  be
14    presented.  The Board shall, at the call of the  chairperson,
15    hold  at  least  3  other  regular  meetings  each year.  The
16    chairperson shall establish the time, manner, and  place  for
17    all  meetings  and  shall  provide notice of the meetings.  A
18    majority of the members  of  the  Board  shall  constitute  a
19    quorum  for  the  transaction  of  any  Board  business.   In
20    addition,  the  Board shall determine the circumstances under
21    which additional meetings of the Board may be held.
22        (b)  The Board may appoint a Director who shall carry out
23    the provisions of this Act.  The Director shall not be one of
24    the appointed Board members.
25        Section 25.  Petroleum Resources Revolving Fund. There is
26    hereby created in the State Treasury a  special  fund  to  be
27    designated  the  "Petroleum  Resources  Revolving Fund".  The
28    Fund shall be a continuing fund, not subject to  fiscal  year
29    limitations  and  shall consist of all moneys received by the
30    Illinois Petroleum Resources Board from assessments  received
31    and  collected  pursuant  to  Section  30  of  this  Act  and
32    donations,  grants,  contributions, and gifts from any public
                            -5-                LRB9007993DPcw
 1    or private source.  Pursuant to appropriation, the Board  may
 2    expend  funds  as provided for by law.  Expenditures from the
 3    Fund  shall  be  made  upon  warrants  issued  by  the  State
 4    Comptroller against claims filed as prescribed by law.
 5        Section 30.  Assessment on oil and gas production.
 6        (a)  To fund the activities  of  the  Illinois  Petroleum
 7    Resources  Board, an assessment shall be levied in the amount
 8    of one-tenth of 1% of gross revenues of oil and gas  produced
 9    from each well in the State of Illinois.
10        (b)  The  assessment  levied  by  subsection  (a) of this
11    Section shall be deducted from the proceeds of production and
12    collected by the first purchaser. The  assessment,  which  is
13    imposed  on the producer, shall be remitted to the Department
14    of Revenue by the first purchaser on a tax  return  filed  no
15    later  than  the  15th day of each month following the end of
16    the month in which the assessment was collected.   To  defray
17    the  costs of receiving and depositing the assessments levied
18    by this Section, the Department of Revenue shall retain  $750
19    per  month  of  the assessments received for deposit into the
20    Tax Compliance and Administration Fund.  The remaining moneys
21    received by  the  Department  of  Revenue  pursuant  to  this
22    Section  shall  be  deposited  into  the  Illinois  Petroleum
23    Resources Revolving Fund.
24        (c)  The   Board   shall   be   responsible   for  taking
25    appropriate legal actions to collect any assessment which  is
26    not paid or is not properly paid.
27        Section 35.  Refunds.
28        (a)  Any  person  subject  to  the  assessment  levied by
29    Section 30 of this Act may request a refund  as  provided  in
30    this  Section  of  the  assessment paid on production for the
31    preceding calendar year.  Upon compliance with the provisions
32    of this Section and rules adopted by the Board  to  implement
                            -6-                LRB9007993DPcw
 1    this   Section,   the  Board  shall  refund  to  each  person
 2    requesting a refund the amount of the assessment paid  by  or
 3    on  behalf  of the person during the preceding calendar year.
 4    Refunds made to producers will include interest earned at the
 5    rate equal to the average United States Treasury bill rate of
 6    the  preceding  calendar  year  as  certified  by  the  State
 7    Treasurer.
 8        (b)  The request for a refund of the assessment  paid  on
 9    production  for  the  preceding  calendar  year  must be made
10    during the first 3 calendar  months  following  the  calendar
11    year for which the refund is requested.  Failure to request a
12    refund  during  this  period shall terminate the right of any
13    person to  receive  a  refund  for  the  assessment  paid  on
14    production  for the preceding calendar year.  The Board shall
15    give notice of the availability of the refund  through  press
16    releases or another means it deems appropriate.
17        (c)  Each  person  requesting  a  refund shall execute an
18    affidavit  showing  the  amount  of  refund   requested   and
19    demonstrating   that   the  affiant  was  the  owner  of  the
20    production for which the refund is requested.  The Board  may
21    verify the accuracy of the request for refund.
22        (d)  No  entity  or person requesting a refund under this
23    Section shall be eligible to serve or have  a  representative
24    serve as a member of the Board.
25        Section 45.  Use of funds.
26        (a)  All  interest  earned  on  moneys  in  the Petroleum
27    Resources Revolving Fund shall remain in the Fund.
28        (b)  The Board shall  not  utilize  any  funds  collected
29    under  Section  30 of this Act for the purpose of influencing
30    government  action  or  policy,   with   the   exception   of
31    recommending amendments to this Act.
32        Section  50.  Application of Act. Nothing in this Act may
                            -7-                LRB9007993DPcw
 1    be construed  to  preempt  or  supersede  any  other  program
 2    relating  to oil and gas promotion or marketing organized and
 3    operated under the laws of  the  State  of  Illinois  or  the
 4    United  States.  In  the  event  of  the  establishment  of a
 5    national program for an assessment on  oil  and  natural  gas
 6    production,   the  Board  by  majority  vote,  may  elect  to
 7    designate up to a maximum of 50% of the funds collected under
 8    this Act to the national program in  lieu  of  an  additional
 9    assessment as may be required by the national program.
10        Section  70.  The Regulatory Agency Sunset Act is amended
11    by adding Section 4.19 as follows:
12        (5 ILCS 80/4.19 new)
13        Sec.  4.19.   Act  repealed  on  January  1,  2008.   The
14    following Act is repealed on January 1, 2008:
15        The Illinois Petroleum Education and Marketing Act.
16        Section   80.  The State Finance Act is amended by adding
17    Section 5.480 as follows:
18        (30 ILCS 105/5.480 new)
19        Sec. 5.480.  The Petroleum Resources Revolving Fund.
20        Section 99.  Effective date.  This Act takes effect  July
21    1, 1998.

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