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90_SB0939 415 ILCS 5/211 new 415 ILCS 5/212 new 415 ILCS 5/Title XVIII heading new 415 ILCS 5/59.1 new 415 ILCS 5/59.2 new 415 ILCS 5/59.3 new 415 ILCS 5/59.4 new 415 ILCS 5/59.5 new 415 ILCS 5/59.6 new 415 ILCS 5/59.7 new 415 ILCS 5/59.8 new 415 ILCS 5/59.9 new Amends the Environmental Protection Act. Creates a new Title of the Act relating to the Brownfields Rehabilitation and Redevelopment Program. Provides that the Agency and the Department of Commerce and Community Affairs shall administer a program that encourages private sector voluntary remediation of environmentally-distressed and underutilized sites that demonstrate the potential to contribute to the economic growth of Illinois if expanded, rehabilitated, or redeveloped. Provides that the provisions of the Title are repealed 5 years after the effective date of this amendatory Act. Amends the Illinois Income Tax Act. Creates the Brownfields Remediation Tax Credit for qualifying taxpayers in an amount equal to the lesser of (i) 100% of the remediation costs expended or (ii) 100% of the projected present value of new State revenue generated by an approved project. Creates the Small Business Remediation Tax Credit for qualified taxpayers in an amount not to exceed $25,000 per project. Provides that a taxpayer may not claim both of the credits created by this amendatory Act. Sunsets the credits after 5 years, except that if the taxpayer's development agreement provides for the Brownfields Remediation Tax Credit beyond the 5-year period, the taxpayer may claim the credit through the term provided in the agreement. Makes other changes. Effective immediately. LRB9003110KDsb LRB9003110KDsb 1 AN ACT in relation to environmental protection, amending 2 named Acts. 3 Be it enacted by the People of the State of Illinois, 4 represented in the General Assembly: 5 Section 5. The Illinois Income Tax Act is amended by 6 adding Sections 211 and 212 as follows: 7 (415 ILCS 5/211 new) 8 Sec. 211. Brownfields Remediation Tax Credit. 9 (a) Beginning with tax years ending on or after January 10 1, 1997, each taxpayer that receives a certificate of 11 eligibility under Section 59.3 of Title XVIII of the 12 Environmental Protection Act is entitled to a credit against 13 the tax imposed by subsections (a) and (b) of Section 201 of 14 this Act in an amount equal to the lesser of (i) 100% of the 15 remediation costs expended following the implementation of a 16 development agreement or (ii) 100% of the projected present 17 value of new State revenues generated by an approved project. 18 (b) If the amount of the tax credit exceeds the tax 19 liability for the year, the excess may be carried forward and 20 applied to the tax liability of any year within the term of 21 the development agreement prescribed under Section 59.5 of 22 Title XVIII of the Environmental Protection Act. 23 (c) The credit claimed under this Section may not exceed 24 the maximum tax credit allowance for the taxable year set 25 forth in the development agreement tax credit distribution 26 schedule prescribed in Section 59.5 of Title XVIII of the 27 Environmental Protection Act. 28 (d) The credit claimed under this Section may be sold, 29 transferred, or assigned in the year the remediation costs 30 are incurred or any time thereafter until the credit has been 31 claimed, provided that the transferee shall take the credits -2- LRB9003110KDsb 1 subject to the development agreement tax credit distribution 2 schedule. 3 (e) In no event shall a credit issued under this Section 4 reduce the taxpayer's liability under this Act to less than 5 zero. 6 (f) This Section is exempt from the provisions of 7 Section 250 of this Act. 8 (415 ILCS 5/212 new) 9 Sec. 212. The Small Business Remediation Tax Credit. 10 For tax years beginning on or after January 1, 1997 and 11 ending on or before December 30, 2002, a taxpayer that 12 employs no more than 50 employees and undertakes a 13 Brownfields project under Title XVIII of the Environmental 14 Protection Act that generates measurable economic benefit 15 resulting in either a revenue neutral benefit or a net 16 fiscal benefit is entitled to a credit against the tax 17 imposed by subsections (a) and (b) of Section 201 of this Act 18 in an amount not to exceed $25,000 per project. The 19 Department, in cooperation with the Department of Commerce 20 and Community Affairs, shall adopt a tax credit schedule as 21 prescribed in Section 59.5 of Title XVIII of the 22 Environmental Protection Act that shall provide the amount of 23 credits available for measurable economic benefit. No credit 24 may be claimed under this Section if the taxpayer has 25 claimed the Brownfields Remediation Tax Credit under Section 26 211 of this Act. 27 Section 10. The Environmental Protection Act is amended 28 by adding Title XVIII as follows: 29 (415 ILCS 5/Title XVIII heading new) 30 TITLE XVIII: BROWNFIELDS REHABILITATION AND REDEVELOPMENT PROGRAM -3- LRB9003110KDsb 1 Sec. 59. Intent. It is the intent of this Title: 2 (1) To encourage private sector voluntary remediation of 3 environmentally-distressed and underutilized sites that 4 demonstrate a potential to contribute to Illinois economic 5 growth if expanded, rehabilitated, or redeveloped. 6 (2) To provide the private sector with incentives to 7 undertake "Brownfields" projects that will have a net fiscal 8 benefit or at a minimum, a revenue neutral impact on Illinois 9 tax revenue. 10 (3) To establish criteria upon which the State may award 11 incentives. 12 (415 ILCS 5/59.1 new) 13 Sec. 59.1. Definitions. As used in this Title: 14 "Applicant" means any person as defined by this Act who 15 applies to proceed under this Title. 16 "Application" means an application submitted to the 17 Agency and the Department of Commerce and Community Affairs 18 for enrollment in the Brownfields Rehabilitation and 19 Redevelopment Program. 20 "Approved Project" means a Brownfields project that has 21 been approved for incentives under this Title. 22 "Brownfields Site" means any site that is enrolled, or 23 will be enrolled, in the Site Investigation and Remedial 24 Activities Program as provided in Title XVII of this Act and 25 that demonstrates a potential for expansion, rehabilitation, 26 or redevelopment. 27 "Brownfields Project" means the proposed expansion, 28 rehabilitation, or redevelopment of a Brownfields site. 29 "DCCA" means the Illinois Department of Commerce and 30 Community Affairs. 31 "Development Agreement" means an agreement entered into 32 between an applicant and DCCA providing types, amount, and 33 timing of incentives available for an approved project, and -4- LRB9003110KDsb 1 setting forth terms and conditions. 2 "Measurable Economic Growth" includes, but is not limited 3 to, factors such as the number of jobs created, the number of 4 jobs retained if demonstrated such jobs would otherwise be 5 lost, the capital investment, capital improvements, the 6 number of construction related jobs, increased sales, 7 material purchases, other increases in service and 8 operational expenditures, and other factors established by 9 DCCA. 10 "Net Fiscal Benefit" means new tax revenue resulting from 11 implementation of a development agreement in excess of the 12 cost of any incentives granted under this Title. 13 "Regulated Substance", "Remedial Action", "Remedial 14 Action Plan", "Remedial Investigation Plan", and "Site" shall 15 have the meanings ascribed to them in the Site Investigation 16 and Remedial Activities Program in Title XVII of this Act. 17 "Remediation Costs" includes all costs associated with 18 investigating and remediating a Brownfields Site and all 19 other costs associated with obtaining a "No Further 20 Remediation Letter" with respect to the approved project 21 under the Site Investigation and Remedial Activities Program 22 in Title XVII of this Act. 23 "Revenue Neutral Impact" means new tax revenue resulting 24 from implementation of a development agreement equal to the 25 cost of any incentives granted under this Title. 26 (415 ILCS 5/59.2 new) 27 Sec. 59.2 Brownfields Rehabilitation and Redevelopment 28 Program. The General Assembly hereby establishes the Illinois 29 Brownfields Rehabilitation and Redevelopment Program. The 30 Program shall be administered by the Agency and DCCA as 31 provided under this Title. 32 (415 ILCS 5/59.3 new) -5- LRB9003110KDsb 1 Sec. 59.3. Program incentives. 2 (a) The Brownfields Remediation Tax Credit. Any 3 applicant, or credit holder if the credit has been sold, 4 transferred, or assigned, claiming the Brownfields 5 Remediation Tax Credit under Section 211 of the Illinois 6 Income Tax Act shall apply to DCCA for a certificate of 7 eligibility for the credit and shall provide, in addition to 8 any other information required by DCCA, certification that 9 the benchmarks for measurable economic benefits established 10 in the development agreement have been satisfied, proof of 11 enrollment in the Site Investigation and Remedial Activities 12 Program in Title XVII of this Act, and an itemization of the 13 amount of remediation costs, if any, that were incurred 14 during the taxable year. Within 30 days after receipt of 15 this information, DCCA shall provide the applicant with 16 notification of receipt and a certificate of eligibility to 17 claim the tax credit or, if applicable, the annual tax credit 18 allowance as set forth in the development agreement tax 19 credit distribution schedule. The Department of Revenue 20 shall prescribe the form for the certificate of eligibility. 21 DCCA shall file with the Department of Revenue a copy of 22 each certificate of eligibility for the tax credit or annual 23 tax credit allowance. DCCA, in cooperation with the 24 Department of Revenue, shall have the power to adopt rules 25 to carry out the provisions of this Section and to require 26 that any applicant that is granted a credit under Section 211 27 of the Illinois Income Tax Act repay the credit if the 28 applicant fails to comply with the terms and conditions of 29 the certificate of eligibility. No applicant may apply for 30 a certificate of eligibility for a tax credit under Section 31 211 of the Illinois Income Tax Act after 5 years after the 32 effective date of this amendatory Act of 1997 unless the 33 applicant's development agreement provides for tax credits 34 for a term beyond this 5-year period. An applicant that -6- LRB9003110KDsb 1 claims the credit in this subsection based on a fraudulent 2 application for a certificate of eligibility or any other 3 fraudulent statement submitted to the Agency or DCCA shall be 4 subject to prosecution under Section 1301 of the Illinois 5 Income Tax Act. 6 (b) The Small Business Remediation Tax Credit. For tax 7 years beginning on or after January 1, 1997 and ending on or 8 before December 30, 2002, an applicant that employs no more 9 than 50 employees and undertakes a Brownfields project that 10 generate measurable economic benefit resulting in either a 11 revenue neutral benefit or a net fiscal benefit may claim the 12 Small Business Remediation Tax Credit. This credit shall 13 not be available to an applicant that claimed the credit 14 provided in subsection (a). An applicant that claims the 15 credit provided in this Section based on a fraudulent 16 statement submitted to the Agency or DCCA shall be subject 17 to prosecution under Section 1301 of the Illinois Income Tax 18 Act. 19 (c) Additional incentives. The Agency may grant 20 approval of any requests for State-provided Phase I or Phase 21 II remedial investigation resources or may make available 22 any other resources the Agency deems appropriate. 23 (415 ILCS 5/59.4 new) 24 Sec. 59.4. Application submittal. At any time prior to 25 commencement or during the performance of investigative or 26 remedial activities under the Site Investigation and Remedial 27 Activities Program in Title XVII of this Act, an application 28 may be submitted to DCCA providing the following available 29 information: 30 (1) Certification that a copy of the application 31 has been submitted to the Agency; 32 (2) Information relating to the actual or potential 33 impact of a regulated substance release on the site that -7- LRB9003110KDsb 1 is the subject of the application; 2 (3) Certification that a site either is 3 participating or is eligible to participate in the Site 4 Investigation and Remedial Activities Program as provided 5 in Title XVII of this Act; 6 (4) A summary of the remedial investigation plan or 7 the remedial action plan compiled under the Site 8 Investigation and Remedial Activities Program of Title 9 XVII of this Act; 10 (5) Approximate budgets for the remedial 11 investigation plan or remedial action plan; 12 (6) A timeline for remediation and receipt of a "No 13 Further Remediation Letter"; 14 (7) A detailed explanation of the proposed 15 Brownfields project; 16 (8) The measurable economic growth expected to 17 result from implementation of the approved project; 18 (9) A timeline for Brownfields project completion 19 and achieving measurable economic growth; and 20 (10) Incentives requested under this Title. 21 (415 ILCS 5/59.5 new) 22 Sec. 59.5. Application review. 23 (a) Within 30 days after receipt of an application, the 24 Agency shall forward to DCCA a letter indicating agreement, 25 disagreement, or need for additional information with respect 26 to the planned investigation and remediation submitted as 27 part of the application. If the Agency disagrees with any 28 portion of the information provided by the applicant, or 29 requires additional information, the Agency shall so state in 30 the letter and provide reasons for any recommendation. 31 (b) Within 45 days after receipt of the application, 32 DCCA shall forward to the applicant a letter indicating 33 approval or disapproval of the application, or need for -8- LRB9003110KDsb 1 additional information, and providing a basis for such 2 decision. 3 (c) If the application is approved, DCCA shall include 4 with the approval letter, a development agreement that shall 5 contain the following: 6 (1) A determination of the present value of new 7 State revenues generated by the projected measurable 8 economic growth of the approved project; 9 (2) The total amount of tax credits projected for 10 the approved project; 11 (3) A determination of the fiscal benefit or 12 revenue neutral impact that will be generated by the 13 approved project; 14 (4) The measurable economic growth benchmarks; 15 (5) A tax credit distribution schedule including 16 annual minimum and maximum tax credit allowances for each 17 year during the entire term of the development agreement; 18 (6) The development agreement term; 19 (7) A list of applicable conditions; and 20 (8) Any other information deemed appropriate by 21 DCCA, including but not limited to, information 22 concerning incentives made available by the Agency and an 23 explanation of how to claim the credits. 24 (415 ILCS 5/59.6 new) 25 Sec. 59.6. Failure to meet measurable economic growth 26 benchmarks. 27 (a) If an applicant determines that the benchmarks set 28 forth in the development agreement are not attainable, an 29 applicant may submit a request for modification of the 30 development agreement to DCCA. 31 (b) DCCA may audit the approved projects and may cancel 32 any credits granted in the development agreement that have 33 not been claimed under Section 59.3 when the approved project -9- LRB9003110KDsb 1 fails to meet measurable economic growth benchmarks. The 2 determination shall be made by DCCA, in its sole discretion, 3 based on the severity of the benchmark not achieved, actions 4 taken to meet the benchmark, the frequency of any failure to 5 meet the benchmark, and compliance with any condition set 6 forth in the development agreement. DCCA shall also consider 7 any changes in the general economic conditions and any 8 recommendation of the Agency concerning severity, scope, 9 nature, frequency, and extent of any deviation from the Site 10 Investigation and Remedial Activities Program in Title XVII 11 of this Act. 12 (415 ILCS 5/59.7 new) 13 Sec. 59.7. Regulations. DCCA shall, with the advice and 14 recommendation of the Agency, issue administrative 15 regulations within 120 days of the effective date of this 16 amendatory Act of 1997 as may be necessary to implement the 17 provisions of this Title, including but not limited to 18 Program application and certification forms, a Small Business 19 Remediation Tax Credit schedule, and a schedule of 20 remediation costs that will be considered qualifying 21 expenditures for the Brownfields Remediation Tax Credit. The 22 Agency may adopt such administrative regulations as necessary 23 to implement the provisions of this Title. 24 (415 ILCS 5/59.8 new) 25 Sec. 59.8. Severability. The provisions of this Title 26 are severable under Section 1.31 of the Statute on Statutes. 27 (415 ILCS 5/59.9 new) 28 Section 59.9. Repealer. The provisions of this Title are 29 repealed effective 5 years after the effective date of this 30 amendatory Act of 1997. This Section shall not impact 31 development agreements entered into prior to the date this -10- LRB9003110KDsb 1 Title is repealed. 2 Section 99. Effective date. This Act takes effect upon 3 becoming law.