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92_SB0075eng SB75 Engrossed LRB9202721SMdv 1 AN ACT concerning the environment. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 5. The State Finance is amended by adding 5 Section 5.545 as follows: 6 (30 ILCS 105/5.545 new) 7 Sec. 5.545. The Distressed Communities and Industries 8 Fund. Subsections (b) and (c) of Section 5 of this Act do not 9 apply to this Fund. 10 Section 10. The Illinois Income Tax Act is amended by 11 changing Section 201 as follows: 12 (35 ILCS 5/201) (from Ch. 120, par. 2-201) 13 Sec. 201. Tax Imposed. 14 (a) In general. A tax measured by net income is hereby 15 imposed on every individual, corporation, trust and estate 16 for each taxable year ending after July 31, 1969 on the 17 privilege of earning or receiving income in or as a resident 18 of this State. Such tax shall be in addition to all other 19 occupation or privilege taxes imposed by this State or by any 20 municipal corporation or political subdivision thereof. 21 (b) Rates. The tax imposed by subsection (a) of this 22 Section shall be determined as follows, except as adjusted by 23 subsection (d-1): 24 (1) In the case of an individual, trust or estate, 25 for taxable years ending prior to July 1, 1989, an amount 26 equal to 2 1/2% of the taxpayer's net income for the 27 taxable year. 28 (2) In the case of an individual, trust or estate, 29 for taxable years beginning prior to July 1, 1989 and SB75 Engrossed -2- LRB9202721SMdv 1 ending after June 30, 1989, an amount equal to the sum of 2 (i) 2 1/2% of the taxpayer's net income for the period 3 prior to July 1, 1989, as calculated under Section 202.3, 4 and (ii) 3% of the taxpayer's net income for the period 5 after June 30, 1989, as calculated under Section 202.3. 6 (3) In the case of an individual, trust or estate, 7 for taxable years beginning after June 30, 1989, an 8 amount equal to 3% of the taxpayer's net income for the 9 taxable year. 10 (4) (Blank). 11 (5) (Blank). 12 (6) In the case of a corporation, for taxable years 13 ending prior to July 1, 1989, an amount equal to 4% of 14 the taxpayer's net income for the taxable year. 15 (7) In the case of a corporation, for taxable years 16 beginning prior to July 1, 1989 and ending after June 30, 17 1989, an amount equal to the sum of (i) 4% of the 18 taxpayer's net income for the period prior to July 1, 19 1989, as calculated under Section 202.3, and (ii) 4.8% of 20 the taxpayer's net income for the period after June 30, 21 1989, as calculated under Section 202.3. 22 (8) In the case of a corporation, for taxable years 23 beginning after June 30, 1989, an amount equal to 4.8% of 24 the taxpayer's net income for the taxable year. 25 (c) Beginning on July 1, 1979 and thereafter, in 26 addition to such income tax, there is also hereby imposed the 27 Personal Property Tax Replacement Income Tax measured by net 28 income on every corporation (including Subchapter S 29 corporations), partnership and trust, for each taxable year 30 ending after June 30, 1979. Such taxes are imposed on the 31 privilege of earning or receiving income in or as a resident 32 of this State. The Personal Property Tax Replacement Income 33 Tax shall be in addition to the income tax imposed by 34 subsections (a) and (b) of this Section and in addition to SB75 Engrossed -3- LRB9202721SMdv 1 all other occupation or privilege taxes imposed by this State 2 or by any municipal corporation or political subdivision 3 thereof. 4 (d) Additional Personal Property Tax Replacement Income 5 Tax Rates. The personal property tax replacement income tax 6 imposed by this subsection and subsection (c) of this Section 7 in the case of a corporation, other than a Subchapter S 8 corporation and except as adjusted by subsection (d-1), shall 9 be an additional amount equal to 2.85% of such taxpayer's net 10 income for the taxable year, except that beginning on January 11 1, 1981, and thereafter, the rate of 2.85% specified in this 12 subsection shall be reduced to 2.5%, and in the case of a 13 partnership, trust or a Subchapter S corporation shall be an 14 additional amount equal to 1.5% of such taxpayer's net income 15 for the taxable year. 16 (d-1) Rate reduction for certain foreign insurers. In 17 the case of a foreign insurer, as defined by Section 35A-5 of 18 the Illinois Insurance Code, whose state or country of 19 domicile imposes on insurers domiciled in Illinois a 20 retaliatory tax (excluding any insurer whose premiums from 21 reinsurance assumed are 50% or more of its total insurance 22 premiums as determined under paragraph (2) of subsection (b) 23 of Section 304, except that for purposes of this 24 determination premiums from reinsurance do not include 25 premiums from inter-affiliate reinsurance arrangements), 26 beginning with taxable years ending on or after December 31, 27 1999, the sum of the rates of tax imposed by subsections (b) 28 and (d) shall be reduced (but not increased) to the rate at 29 which the total amount of tax imposed under this Act, net of 30 all credits allowed under this Act, shall equal (i) the total 31 amount of tax that would be imposed on the foreign insurer's 32 net income allocable to Illinois for the taxable year by such 33 foreign insurer's state or country of domicile if that net 34 income were subject to all income taxes and taxes measured by SB75 Engrossed -4- LRB9202721SMdv 1 net income imposed by such foreign insurer's state or country 2 of domicile, net of all credits allowed or (ii) a rate of 3 zero if no such tax is imposed on such income by the foreign 4 insurer's state of domicile. For the purposes of this 5 subsection (d-1), an inter-affiliate includes a mutual 6 insurer under common management. 7 (1) For the purposes of subsection (d-1), in no 8 event shall the sum of the rates of tax imposed by 9 subsections (b) and (d) be reduced below the rate at 10 which the sum of: 11 (A) the total amount of tax imposed on such 12 foreign insurer under this Act for a taxable year, 13 net of all credits allowed under this Act, plus 14 (B) the privilege tax imposed by Section 409 15 of the Illinois Insurance Code, the fire insurance 16 company tax imposed by Section 12 of the Fire 17 Investigation Act, and the fire department taxes 18 imposed under Section 11-10-1 of the Illinois 19 Municipal Code, 20 equals 1.25% of the net taxable premiums written for the 21 taxable year, as described by subsection (1) of Section 22 409 of the Illinois Insurance Code. This paragraph will 23 in no event increase the rates imposed under subsections 24 (b) and (d). 25 (2) Any reduction in the rates of tax imposed by 26 this subsection shall be applied first against the rates 27 imposed by subsection (b) and only after the tax imposed 28 by subsection (a) net of all credits allowed under this 29 Section other than the credit allowed under subsection 30 (i) has been reduced to zero, against the rates imposed 31 by subsection (d). 32 This subsection (d-1) is exempt from the provisions of 33 Section 250. 34 (e) Investment credit. A taxpayer shall be allowed a SB75 Engrossed -5- LRB9202721SMdv 1 credit against the Personal Property Tax Replacement Income 2 Tax for investment in qualified property. 3 (1) A taxpayer shall be allowed a credit equal to 4 .5% of the basis of qualified property placed in service 5 during the taxable year, provided such property is placed 6 in service on or after July 1, 1984. There shall be 7 allowed an additional credit equal to .5% of the basis of 8 qualified property placed in service during the taxable 9 year, provided such property is placed in service on or 10 after July 1, 1986, and the taxpayer's base employment 11 within Illinois has increased by 1% or more over the 12 preceding year as determined by the taxpayer's employment 13 records filed with the Illinois Department of Employment 14 Security. Taxpayers who are new to Illinois shall be 15 deemed to have met the 1% growth in base employment for 16 the first year in which they file employment records with 17 the Illinois Department of Employment Security. The 18 provisions added to this Section by Public Act 85-1200 19 (and restored by Public Act 87-895) shall be construed as 20 declaratory of existing law and not as a new enactment. 21 If, in any year, the increase in base employment within 22 Illinois over the preceding year is less than 1%, the 23 additional credit shall be limited to that percentage 24 times a fraction, the numerator of which is .5% and the 25 denominator of which is 1%, but shall not exceed .5%. 26 The investment credit shall not be allowed to the extent 27 that it would reduce a taxpayer's liability in any tax 28 year below zero, nor may any credit for qualified 29 property be allowed for any year other than the year in 30 which the property was placed in service in Illinois. For 31 tax years ending on or after December 31, 1987, and on or 32 before December 31, 1988, the credit shall be allowed for 33 the tax year in which the property is placed in service, 34 or, if the amount of the credit exceeds the tax liability SB75 Engrossed -6- LRB9202721SMdv 1 for that year, whether it exceeds the original liability 2 or the liability as later amended, such excess may be 3 carried forward and applied to the tax liability of the 5 4 taxable years following the excess credit years if the 5 taxpayer (i) makes investments which cause the creation 6 of a minimum of 2,000 full-time equivalent jobs in 7 Illinois, (ii) is located in an enterprise zone 8 established pursuant to the Illinois Enterprise Zone Act 9 and (iii) is certified by the Department of Commerce and 10 Community Affairs as complying with the requirements 11 specified in clause (i) and (ii) by July 1, 1986. The 12 Department of Commerce and Community Affairs shall notify 13 the Department of Revenue of all such certifications 14 immediately. For tax years ending after December 31, 15 1988, the credit shall be allowed for the tax year in 16 which the property is placed in service, or, if the 17 amount of the credit exceeds the tax liability for that 18 year, whether it exceeds the original liability or the 19 liability as later amended, such excess may be carried 20 forward and applied to the tax liability of the 5 taxable 21 years following the excess credit years. The credit shall 22 be applied to the earliest year for which there is a 23 liability. If there is credit from more than one tax year 24 that is available to offset a liability, earlier credit 25 shall be applied first. 26 (2) The term "qualified property" means property 27 which: 28 (A) is tangible, whether new or used, 29 including buildings and structural components of 30 buildings and signs that are real property, but not 31 including land or improvements to real property that 32 are not a structural component of a building such as 33 landscaping, sewer lines, local access roads, 34 fencing, parking lots, and other appurtenances; SB75 Engrossed -7- LRB9202721SMdv 1 (B) is depreciable pursuant to Section 167 of 2 the Internal Revenue Code, except that "3-year 3 property" as defined in Section 168(c)(2)(A) of that 4 Code is not eligible for the credit provided by this 5 subsection (e); 6 (C) is acquired by purchase as defined in 7 Section 179(d) of the Internal Revenue Code; 8 (D) is used in Illinois by a taxpayer who is 9 primarily engaged in manufacturing, or in mining 10 coal or fluorite, or in retailing; and 11 (E) has not previously been used in Illinois 12 in such a manner and by such a person as would 13 qualify for the credit provided by this subsection 14 (e) or subsection (f). 15 (3) For purposes of this subsection (e), 16 "manufacturing" means the material staging and production 17 of tangible personal property by procedures commonly 18 regarded as manufacturing, processing, fabrication, or 19 assembling which changes some existing material into new 20 shapes, new qualities, or new combinations. For purposes 21 of this subsection (e) the term "mining" shall have the 22 same meaning as the term "mining" in Section 613(c) of 23 the Internal Revenue Code. For purposes of this 24 subsection (e), the term "retailing" means the sale of 25 tangible personal property or services rendered in 26 conjunction with the sale of tangible consumer goods or 27 commodities. 28 (4) The basis of qualified property shall be the 29 basis used to compute the depreciation deduction for 30 federal income tax purposes. 31 (5) If the basis of the property for federal income 32 tax depreciation purposes is increased after it has been 33 placed in service in Illinois by the taxpayer, the amount 34 of such increase shall be deemed property placed in SB75 Engrossed -8- LRB9202721SMdv 1 service on the date of such increase in basis. 2 (6) The term "placed in service" shall have the 3 same meaning as under Section 46 of the Internal Revenue 4 Code. 5 (7) If during any taxable year, any property ceases 6 to be qualified property in the hands of the taxpayer 7 within 48 months after being placed in service, or the 8 situs of any qualified property is moved outside Illinois 9 within 48 months after being placed in service, the 10 Personal Property Tax Replacement Income Tax for such 11 taxable year shall be increased. Such increase shall be 12 determined by (i) recomputing the investment credit which 13 would have been allowed for the year in which credit for 14 such property was originally allowed by eliminating such 15 property from such computation and, (ii) subtracting such 16 recomputed credit from the amount of credit previously 17 allowed. For the purposes of this paragraph (7), a 18 reduction of the basis of qualified property resulting 19 from a redetermination of the purchase price shall be 20 deemed a disposition of qualified property to the extent 21 of such reduction. 22 (8) Unless the investment credit is extended by 23 law, the basis of qualified property shall not include 24 costs incurred after December 31, 2003, except for costs 25 incurred pursuant to a binding contract entered into on 26 or before December 31, 2003. 27 (9) Each taxable year ending before December 31, 28 2000, a partnership may elect to pass through to its 29 partners the credits to which the partnership is entitled 30 under this subsection (e) for the taxable year. A 31 partner may use the credit allocated to him or her under 32 this paragraph only against the tax imposed in 33 subsections (c) and (d) of this Section. If the 34 partnership makes that election, those credits shall be SB75 Engrossed -9- LRB9202721SMdv 1 allocated among the partners in the partnership in 2 accordance with the rules set forth in Section 704(b) of 3 the Internal Revenue Code, and the rules promulgated 4 under that Section, and the allocated amount of the 5 credits shall be allowed to the partners for that taxable 6 year. The partnership shall make this election on its 7 Personal Property Tax Replacement Income Tax return for 8 that taxable year. The election to pass through the 9 credits shall be irrevocable. 10 For taxable years ending on or after December 31, 11 2000, a partner that qualifies its partnership for a 12 subtraction under subparagraph (I) of paragraph (2) of 13 subsection (d) of Section 203 or a shareholder that 14 qualifies a Subchapter S corporation for a subtraction 15 under subparagraph (S) of paragraph (2) of subsection (b) 16 of Section 203 shall be allowed a credit under this 17 subsection (e) equal to its share of the credit earned 18 under this subsection (e) during the taxable year by the 19 partnership or Subchapter S corporation, determined in 20 accordance with the determination of income and 21 distributive share of income under Sections 702 and 704 22 and Subchapter S of the Internal Revenue Code. This 23 paragraph is exempt from the provisions of Section 250. 24 (f) Investment credit; Enterprise Zone. 25 (1) A taxpayer shall be allowed a credit against 26 the tax imposed by subsections (a) and (b) of this 27 Section for investment in qualified property which is 28 placed in service in an Enterprise Zone created pursuant 29 to the Illinois Enterprise Zone Act. For partners, 30 shareholders of Subchapter S corporations, and owners of 31 limited liability companies, if the liability company is 32 treated as a partnership for purposes of federal and 33 State income taxation, there shall be allowed a credit 34 under this subsection (f) to be determined in accordance SB75 Engrossed -10- LRB9202721SMdv 1 with the determination of income and distributive share 2 of income under Sections 702 and 704 and Subchapter S of 3 the Internal Revenue Code. The credit shall be .5% of the 4 basis for such property. The credit shall be available 5 only in the taxable year in which the property is placed 6 in service in the Enterprise Zone and shall not be 7 allowed to the extent that it would reduce a taxpayer's 8 liability for the tax imposed by subsections (a) and (b) 9 of this Section to below zero. For tax years ending on or 10 after December 31, 1985, the credit shall be allowed for 11 the tax year in which the property is placed in service, 12 or, if the amount of the credit exceeds the tax liability 13 for that year, whether it exceeds the original liability 14 or the liability as later amended, such excess may be 15 carried forward and applied to the tax liability of the 5 16 taxable years following the excess credit year. The 17 credit shall be applied to the earliest year for which 18 there is a liability. If there is credit from more than 19 one tax year that is available to offset a liability, the 20 credit accruing first in time shall be applied first. 21 (2) The term qualified property means property 22 which: 23 (A) is tangible, whether new or used, 24 including buildings and structural components of 25 buildings; 26 (B) is depreciable pursuant to Section 167 of 27 the Internal Revenue Code, except that "3-year 28 property" as defined in Section 168(c)(2)(A) of that 29 Code is not eligible for the credit provided by this 30 subsection (f); 31 (C) is acquired by purchase as defined in 32 Section 179(d) of the Internal Revenue Code; 33 (D) is used in the Enterprise Zone by the 34 taxpayer; and SB75 Engrossed -11- LRB9202721SMdv 1 (E) has not been previously used in Illinois 2 in such a manner and by such a person as would 3 qualify for the credit provided by this subsection 4 (f) or subsection (e). 5 (3) The basis of qualified property shall be the 6 basis used to compute the depreciation deduction for 7 federal income tax purposes. 8 (4) If the basis of the property for federal income 9 tax depreciation purposes is increased after it has been 10 placed in service in the Enterprise Zone by the taxpayer, 11 the amount of such increase shall be deemed property 12 placed in service on the date of such increase in basis. 13 (5) The term "placed in service" shall have the 14 same meaning as under Section 46 of the Internal Revenue 15 Code. 16 (6) If during any taxable year, any property ceases 17 to be qualified property in the hands of the taxpayer 18 within 48 months after being placed in service, or the 19 situs of any qualified property is moved outside the 20 Enterprise Zone within 48 months after being placed in 21 service, the tax imposed under subsections (a) and (b) of 22 this Section for such taxable year shall be increased. 23 Such increase shall be determined by (i) recomputing the 24 investment credit which would have been allowed for the 25 year in which credit for such property was originally 26 allowed by eliminating such property from such 27 computation, and (ii) subtracting such recomputed credit 28 from the amount of credit previously allowed. For the 29 purposes of this paragraph (6), a reduction of the basis 30 of qualified property resulting from a redetermination of 31 the purchase price shall be deemed a disposition of 32 qualified property to the extent of such reduction. 33 (g) Jobs Tax Credit; Enterprise Zone and Foreign Trade 34 Zone or Sub-Zone. SB75 Engrossed -12- LRB9202721SMdv 1 (1) A taxpayer conducting a trade or business in an 2 enterprise zone or a High Impact Business designated by 3 the Department of Commerce and Community Affairs 4 conducting a trade or business in a federally designated 5 Foreign Trade Zone or Sub-Zone shall be allowed a credit 6 against the tax imposed by subsections (a) and (b) of 7 this Section in the amount of $500 per eligible employee 8 hired to work in the zone during the taxable year. 9 (2) To qualify for the credit: 10 (A) the taxpayer must hire 5 or more eligible 11 employees to work in an enterprise zone or federally 12 designated Foreign Trade Zone or Sub-Zone during the 13 taxable year; 14 (B) the taxpayer's total employment within the 15 enterprise zone or federally designated Foreign 16 Trade Zone or Sub-Zone must increase by 5 or more 17 full-time employees beyond the total employed in 18 that zone at the end of the previous tax year for 19 which a jobs tax credit under this Section was 20 taken, or beyond the total employed by the taxpayer 21 as of December 31, 1985, whichever is later; and 22 (C) the eligible employees must be employed 23 180 consecutive days in order to be deemed hired for 24 purposes of this subsection. 25 (3) An "eligible employee" means an employee who 26 is: 27 (A) Certified by the Department of Commerce 28 and Community Affairs as "eligible for services" 29 pursuant to regulations promulgated in accordance 30 with Title II of the Job Training Partnership Act, 31 Training Services for the Disadvantaged or Title III 32 of the Job Training Partnership Act, Employment and 33 Training Assistance for Dislocated Workers Program. 34 (B) Hired after the enterprise zone or SB75 Engrossed -13- LRB9202721SMdv 1 federally designated Foreign Trade Zone or Sub-Zone 2 was designated or the trade or business was located 3 in that zone, whichever is later. 4 (C) Employed in the enterprise zone or Foreign 5 Trade Zone or Sub-Zone. An employee is employed in 6 an enterprise zone or federally designated Foreign 7 Trade Zone or Sub-Zone if his services are rendered 8 there or it is the base of operations for the 9 services performed. 10 (D) A full-time employee working 30 or more 11 hours per week. 12 (4) For tax years ending on or after December 31, 13 1985 and prior to December 31, 1988, the credit shall be 14 allowed for the tax year in which the eligible employees 15 are hired. For tax years ending on or after December 31, 16 1988, the credit shall be allowed for the tax year 17 immediately following the tax year in which the eligible 18 employees are hired. If the amount of the credit exceeds 19 the tax liability for that year, whether it exceeds the 20 original liability or the liability as later amended, 21 such excess may be carried forward and applied to the tax 22 liability of the 5 taxable years following the excess 23 credit year. The credit shall be applied to the earliest 24 year for which there is a liability. If there is credit 25 from more than one tax year that is available to offset a 26 liability, earlier credit shall be applied first. 27 (5) The Department of Revenue shall promulgate such 28 rules and regulations as may be deemed necessary to carry 29 out the purposes of this subsection (g). 30 (6) The credit shall be available for eligible 31 employees hired on or after January 1, 1986. 32 (h) Investment credit; High Impact Business. 33 (1) Subject to subsection (b) of Section 5.5 of the 34 Illinois Enterprise Zone Act, a taxpayer shall be allowed SB75 Engrossed -14- LRB9202721SMdv 1 a credit against the tax imposed by subsections (a) and 2 (b) of this Section for investment in qualified property 3 which is placed in service by a Department of Commerce 4 and Community Affairs designated High Impact Business. 5 The credit shall be .5% of the basis for such property. 6 The credit shall not be available until the minimum 7 investments in qualified property set forth in Section 8 5.5 of the Illinois Enterprise Zone Act have been 9 satisfied and shall not be allowed to the extent that it 10 would reduce a taxpayer's liability for the tax imposed 11 by subsections (a) and (b) of this Section to below zero. 12 The credit applicable to such minimum investments shall 13 be taken in the taxable year in which such minimum 14 investments have been completed. The credit for 15 additional investments beyond the minimum investment by a 16 designated high impact business shall be available only 17 in the taxable year in which the property is placed in 18 service and shall not be allowed to the extent that it 19 would reduce a taxpayer's liability for the tax imposed 20 by subsections (a) and (b) of this Section to below zero. 21 For tax years ending on or after December 31, 1987, the 22 credit shall be allowed for the tax year in which the 23 property is placed in service, or, if the amount of the 24 credit exceeds the tax liability for that year, whether 25 it exceeds the original liability or the liability as 26 later amended, such excess may be carried forward and 27 applied to the tax liability of the 5 taxable years 28 following the excess credit year. The credit shall be 29 applied to the earliest year for which there is a 30 liability. If there is credit from more than one tax 31 year that is available to offset a liability, the credit 32 accruing first in time shall be applied first. 33 Changes made in this subdivision (h)(1) by Public 34 Act 88-670 restore changes made by Public Act 85-1182 and SB75 Engrossed -15- LRB9202721SMdv 1 reflect existing law. 2 (2) The term qualified property means property 3 which: 4 (A) is tangible, whether new or used, 5 including buildings and structural components of 6 buildings; 7 (B) is depreciable pursuant to Section 167 of 8 the Internal Revenue Code, except that "3-year 9 property" as defined in Section 168(c)(2)(A) of that 10 Code is not eligible for the credit provided by this 11 subsection (h); 12 (C) is acquired by purchase as defined in 13 Section 179(d) of the Internal Revenue Code; and 14 (D) is not eligible for the Enterprise Zone 15 Investment Credit provided by subsection (f) of this 16 Section. 17 (3) The basis of qualified property shall be the 18 basis used to compute the depreciation deduction for 19 federal income tax purposes. 20 (4) If the basis of the property for federal income 21 tax depreciation purposes is increased after it has been 22 placed in service in a federally designated Foreign Trade 23 Zone or Sub-Zone located in Illinois by the taxpayer, the 24 amount of such increase shall be deemed property placed 25 in service on the date of such increase in basis. 26 (5) The term "placed in service" shall have the 27 same meaning as under Section 46 of the Internal Revenue 28 Code. 29 (6) If during any taxable year ending on or before 30 December 31, 1996, any property ceases to be qualified 31 property in the hands of the taxpayer within 48 months 32 after being placed in service, or the situs of any 33 qualified property is moved outside Illinois within 48 34 months after being placed in service, the tax imposed SB75 Engrossed -16- LRB9202721SMdv 1 under subsections (a) and (b) of this Section for such 2 taxable year shall be increased. Such increase shall be 3 determined by (i) recomputing the investment credit which 4 would have been allowed for the year in which credit for 5 such property was originally allowed by eliminating such 6 property from such computation, and (ii) subtracting such 7 recomputed credit from the amount of credit previously 8 allowed. For the purposes of this paragraph (6), a 9 reduction of the basis of qualified property resulting 10 from a redetermination of the purchase price shall be 11 deemed a disposition of qualified property to the extent 12 of such reduction. 13 (7) Beginning with tax years ending after December 14 31, 1996, if a taxpayer qualifies for the credit under 15 this subsection (h) and thereby is granted a tax 16 abatement and the taxpayer relocates its entire facility 17 in violation of the explicit terms and length of the 18 contract under Section 18-183 of the Property Tax Code, 19 the tax imposed under subsections (a) and (b) of this 20 Section shall be increased for the taxable year in which 21 the taxpayer relocated its facility by an amount equal to 22 the amount of credit received by the taxpayer under this 23 subsection (h). 24 (i) A credit shall be allowed against the tax imposed by 25 subsections (a) and (b) of this Section for the tax imposed 26 by subsections (c) and (d) of this Section. This credit 27 shall be computed by multiplying the tax imposed by 28 subsections (c) and (d) of this Section by a fraction, the 29 numerator of which is base income allocable to Illinois and 30 the denominator of which is Illinois base income, and further 31 multiplying the product by the tax rate imposed by 32 subsections (a) and (b) of this Section. 33 Any credit earned on or after December 31, 1986 under 34 this subsection which is unused in the year the credit is SB75 Engrossed -17- LRB9202721SMdv 1 computed because it exceeds the tax liability imposed by 2 subsections (a) and (b) for that year (whether it exceeds the 3 original liability or the liability as later amended) may be 4 carried forward and applied to the tax liability imposed by 5 subsections (a) and (b) of the 5 taxable years following the 6 excess credit year. This credit shall be applied first to 7 the earliest year for which there is a liability. If there 8 is a credit under this subsection from more than one tax year 9 that is available to offset a liability the earliest credit 10 arising under this subsection shall be applied first. 11 If, during any taxable year ending on or after December 12 31, 1986, the tax imposed by subsections (c) and (d) of this 13 Section for which a taxpayer has claimed a credit under this 14 subsection (i) is reduced, the amount of credit for such tax 15 shall also be reduced. Such reduction shall be determined by 16 recomputing the credit to take into account the reduced tax 17 imposed by subsection (c) and (d). If any portion of the 18 reduced amount of credit has been carried to a different 19 taxable year, an amended return shall be filed for such 20 taxable year to reduce the amount of credit claimed. 21 (j) Training expense credit. Beginning with tax years 22 ending on or after December 31, 1986, a taxpayer shall be 23 allowed a credit against the tax imposed by subsection (a) 24 and (b) under this Section for all amounts paid or accrued, 25 on behalf of all persons employed by the taxpayer in Illinois 26 or Illinois residents employed outside of Illinois by a 27 taxpayer, for educational or vocational training in 28 semi-technical or technical fields or semi-skilled or skilled 29 fields, which were deducted from gross income in the 30 computation of taxable income. The credit against the tax 31 imposed by subsections (a) and (b) shall be 1.6% of such 32 training expenses. For partners, shareholders of subchapter 33 S corporations, and owners of limited liability companies, if 34 the liability company is treated as a partnership for SB75 Engrossed -18- LRB9202721SMdv 1 purposes of federal and State income taxation, there shall be 2 allowed a credit under this subsection (j) to be determined 3 in accordance with the determination of income and 4 distributive share of income under Sections 702 and 704 and 5 subchapter S of the Internal Revenue Code. 6 Any credit allowed under this subsection which is unused 7 in the year the credit is earned may be carried forward to 8 each of the 5 taxable years following the year for which the 9 credit is first computed until it is used. This credit shall 10 be applied first to the earliest year for which there is a 11 liability. If there is a credit under this subsection from 12 more than one tax year that is available to offset a 13 liability the earliest credit arising under this subsection 14 shall be applied first. 15 (k) Research and development credit. 16 Beginning with tax years ending after July 1, 1990, a 17 taxpayer shall be allowed a credit against the tax imposed by 18 subsections (a) and (b) of this Section for increasing 19 research activities in this State. The credit allowed 20 against the tax imposed by subsections (a) and (b) shall be 21 equal to 6 1/2% of the qualifying expenditures for increasing 22 research activities in this State. For partners, shareholders 23 of subchapter S corporations, and owners of limited liability 24 companies, if the liability company is treated as a 25 partnership for purposes of federal and State income 26 taxation, there shall be allowed a credit under this 27 subsection to be determined in accordance with the 28 determination of income and distributive share of income 29 under Sections 702 and 704 and subchapter S of the Internal 30 Revenue Code. 31 For purposes of this subsection, "qualifying 32 expenditures" means the qualifying expenditures as defined 33 for the federal credit for increasing research activities 34 which would be allowable under Section 41 of the Internal SB75 Engrossed -19- LRB9202721SMdv 1 Revenue Code and which are conducted in this State, 2 "qualifying expenditures for increasing research activities 3 in this State" means the excess of qualifying expenditures 4 for the taxable year in which incurred over qualifying 5 expenditures for the base period, "qualifying expenditures 6 for the base period" means the average of the qualifying 7 expenditures for each year in the base period, and "base 8 period" means the 3 taxable years immediately preceding the 9 taxable year for which the determination is being made. 10 Any credit in excess of the tax liability for the taxable 11 year may be carried forward. A taxpayer may elect to have the 12 unused credit shown on its final completed return carried 13 over as a credit against the tax liability for the following 14 5 taxable years or until it has been fully used, whichever 15 occurs first. 16 If an unused credit is carried forward to a given year 17 from 2 or more earlier years, that credit arising in the 18 earliest year will be applied first against the tax liability 19 for the given year. If a tax liability for the given year 20 still remains, the credit from the next earliest year will 21 then be applied, and so on, until all credits have been used 22 or no tax liability for the given year remains. Any 23 remaining unused credit or credits then will be carried 24 forward to the next following year in which a tax liability 25 is incurred, except that no credit can be carried forward to 26 a year which is more than 5 years after the year in which the 27 expense for which the credit is given was incurred. 28 Unless extended by law, the credit shall not include 29 costs incurred after December 31, 2004, except for costs 30 incurred pursuant to a binding contract entered into on or 31 before December 31, 2004. 32 No inference shall be drawn from this amendatory Act of 33 the 91st General Assembly in construing this Section for 34 taxable years beginning before January 1, 1999. SB75 Engrossed -20- LRB9202721SMdv 1 (l) Environmental Remediation Tax Credit. 2 (i) For tax years ending after December 31, 1997 3 and on or before December 31, 20062001, a taxpayer shall 4 be allowed a credit against the tax imposed by 5 subsections (a) and (b) of this Section for certain 6 amounts paid for unreimbursed eligible remediation costs, 7 as specified in this subsection. For purposes of this 8 Section, "unreimbursed eligible remediation costs" means 9 costs approved by the Illinois Environmental Protection 10 Agency ("Agency") under Section 58.14 of the 11 Environmental Protection Act that were paid in performing 12 environmental remediation at a site accepted into the 13 Site Remediation Program that meets the criteria set 14 forth in Section 58.14 of the Illinois Environmental 15 Protection Act. The credit applies only to costs 16 incurred during the 10-year period following the 17 acceptance of the site into the Site Remediation Program 18 unless an extension of this period is granted by the 19 Department of Commerce and Community Affairsfor which a20No Further Remediation Letter was issued by the Agency21and recorded under Section 58.10 of the Environmental22Protection Act. The credit must be claimed for the23taxable year in which Agency approval of the eligible24remediation costs is granted. The credit is available for 25 only those sites that are determined by the Department of 26 Commerce and Community Affairs to be abandoned or 27 underutilized properties pursuant to Section 58.14 of the 28 Environmental Protection Act. The credit is not available 29 to any taxpayer if the taxpayer or any related party 30 caused or contributed to, in any material respect, a 31 release of regulated substances on, in, or under the site 32 that is beingwasidentified and addressed by the 33 remedial action pursuant to the Site Remediation Program 34 of the Environmental Protection Act.After the PollutionSB75 Engrossed -21- LRB9202721SMdv 1Control Board rules are adopted pursuant to the Illinois2Administrative Procedure Act for the administration and3enforcement of Section 58.9 of the Environmental4Protection Act,Determinations as to credit availability 5 for purposes of this Section shall be made consistent 6 withthoserules adopted by the Pollution Control Board 7 for the administration and enforcement of Section 58.9 of 8 the Environmental Protection Act. For purposes of this 9 Section, "taxpayer" includes a person whose tax 10 attributes the taxpayer has succeeded to under Section 11 381 of the Internal Revenue Code and "related party" 12 includes the persons disallowed a deduction for losses by 13 paragraphs (b), (c), and (f)(1) of Section 267 of the 14 Internal Revenue Code by virtue of being a related 15 taxpayer, as well as any of its partners. The credit 16 allowed against the tax imposed by subsections (a) and 17 (b) shall be equal to 100%25%of the unreimbursed 18 eligible remediation costs, as set forth in Section 58.14 19 of the Environmental Protection Act and shall not exceed 20 the net economic benefit of the remediation, as 21 determined by the Department of Commerce and Community 22 Affairsin excess of $100,000 per site, except that the23$100,000 threshold shall not apply to any site contained24in an enterprise zone as determined by the Department of25Commerce and Community Affairs. The total credit allowed26shall not exceed $40,000 per year with a maximum total of27$150,000 per site. For partners and shareholders of 28 subchapter S corporations, there shall be allowed a 29 credit under this subsection to be determined in 30 accordance with the determination of income and 31 distributive share of income under Sections 702 and 704 32 andofsubchapter S of the Internal Revenue Code. 33 (ii) For a Remediation Applicant seeking a credit 34 under subsection (b-5) of Section 58.14 of the SB75 Engrossed -22- LRB9202721SMdv 1 Environmental Protection Act, until the Agency issues a 2 No Further Remediation Letter for the site, no more than 3 75% of the allowed credit may be claimed by the eligible 4 taxpayer. The remaining 25% in allowed tax credits may 5 be claimed following the issuance by the Agency of a No 6 Further Remediation Letter for the site. For a 7 Remediation Applicant seeking a credit under subsection 8 (b) of Section 58.14 of the Environmental Protection Act, 9 until the Agency issues a No Further Remediation Letter 10 for the site, no credit may be claimed by the eligible 11 taxpayer. 12 (iii)(ii)A credit allowed under this subsection 13 that is unused in the year the credit is earned may be 14 carried forward to each of the 5 taxable years following 15 the year for which the credit is first earned until it is 16 used.The term "unused credit" does not include any17amounts of unreimbursed eligible remediation costs in18excess of the maximum credit per site authorized under19paragraph (i).This credit shall be applied first to the 20 earliest year for which there is a liability. If there 21 is a credit under this subsection from more than one tax 22 year that is available to offset a liability, the 23 earliest credit arising under this subsection shall be 24 applied first. The recipient of credits may assign, sell, 25 or transfer, in whole or in part, the tax credit allowed 26 under this subsection to any other person.A credit27allowed under this subsection may be sold to a buyer as28part of a sale of all or part of the remediation site for29which the credit was granted. The purchaser of a30remediation site and the tax credit shall succeed to the31unused credit and remaining carry-forward period of the32seller.To perfect the transfer, the assignor shall 33record the transfer in the chain of title for the site34andprovide written notice to the Director of the SB75 Engrossed -23- LRB9202721SMdv 1 Illinois Department of Revenue of (i) the assignor's 2 intent to transfer the tax credits to the assignee, (ii) 3 the date the transfer is effective, (iii) the assignee's 4 name and address, (iv) the assignee's tax period, and (v) 5 the amount of tax credits to be transferred. The number 6 of taxable years during which the assignee may 7 subsequently claim the tax credits shall not exceed 5 8 taxable years, less the number of taxable years the 9 assignor previously claimed the credits before the 10 transfer occurredsell the remediation site and the11amount of the tax credit to be transferred as a portion12of the sale. In no event may a credit be transferred to 13 any taxpayer if the taxpayer or a related party would not 14 be eligible under the provisions of subsection (i). 15 (iv)(iii)For purposes of this Section, the term 16 "site" shall have the same meaning as under Section 58.2 17 of the Environmental Protection Act. 18 The changes made to this subsection (l) by this 19 amendatory Act of the 92nd General Assembly apply to taxable 20 years ending on or after December 31, 2001. 21 (m) Education expense credit. 22 Beginning with tax years ending after December 31, 1999, 23 a taxpayer who is the custodian of one or more qualifying 24 pupils shall be allowed a credit against the tax imposed by 25 subsections (a) and (b) of this Section for qualified 26 education expenses incurred on behalf of the qualifying 27 pupils. The credit shall be equal to 25% of qualified 28 education expenses, but in no event may the total credit 29 under this Section claimed by a family that is the custodian 30 of qualifying pupils exceed $500. In no event shall a credit 31 under this subsection reduce the taxpayer's liability under 32 this Act to less than zero. This subsection is exempt from 33 the provisions of Section 250 of this Act. 34 For purposes of this subsection; SB75 Engrossed -24- LRB9202721SMdv 1 "Qualifying pupils" means individuals who (i) are 2 residents of the State of Illinois, (ii) are under the age of 3 21 at the close of the school year for which a credit is 4 sought, and (iii) during the school year for which a credit 5 is sought were full-time pupils enrolled in a kindergarten 6 through twelfth grade education program at any school, as 7 defined in this subsection. 8 "Qualified education expense" means the amount incurred 9 on behalf of a qualifying pupil in excess of $250 for 10 tuition, book fees, and lab fees at the school in which the 11 pupil is enrolled during the regular school year. 12 "School" means any public or nonpublic elementary or 13 secondary school in Illinois that is in compliance with Title 14 VI of the Civil Rights Act of 1964 and attendance at which 15 satisfies the requirements of Section 26-1 of the School 16 Code, except that nothing shall be construed to require a 17 child to attend any particular public or nonpublic school to 18 qualify for the credit under this Section. 19 "Custodian" means, with respect to qualifying pupils, an 20 Illinois resident who is a parent, the parents, a legal 21 guardian, or the legal guardians of the qualifying pupils. 22 (Source: P.A. 90-123, eff. 7-21-97; 90-458, eff. 8-17-97; 23 90-605, eff. 6-30-98; 90-655, eff. 7-30-98; 90-717, eff. 24 8-7-98; 90-792, eff. 1-1-99; 91-9, eff. 1-1-00; 91-357, eff. 25 7-29-99; 91-643, eff. 8-20-99; 91-644, eff. 8-20-99; 91-860, 26 eff. 6-22-00; 91-913, eff. 1-1-01; revised 10-24-00.) 27 Section 15. The Environmental Protection Act is amended 28 by changing Sections 58.13 and 58.14 as follows: 29 (415 ILCS 5/58.13) 30 Sec. 58.13. Brownfields Redevelopment Grant Program. 31 (a)(1) The Agency shall establish and administer a 32 program of grants to be known as the Brownfields SB75 Engrossed -25- LRB9202721SMdv 1 Redevelopment Grant Program to provide municipalities in 2 Illinois with financial assistance to be used for 3 coordination of activities related to brownfields 4 redevelopment, including but not limited to 5 identification of brownfields sites, site investigation 6 and determination of remediation objectives and related 7 plans and reports, and development of remedial action 8 plans, but not including the implementation of remedial 9 action plans and remedial action completion reports. The 10 plans and reports shall be developed in accordance with 11 Title XVII of this Act. 12 (2) Grants shall be awarded on a competitive basis 13 subject to availability of funding. Criteria for 14 awarding grants shall include, but shall not be limited 15 to the following: 16 (A) problem statement and needs assessment; 17 (B) community-based planning and involvement; 18 (C) implementation planning; and 19 (D) long-term benefits and sustainability. 20 (3) The Agency may give weight to geographic 21 location to enhance geographic distribution of grants 22 across this State. 23 (4) Grants shall be limited to a maximum of 24 $120,000 and no municipality shall receive more than 2 25 grantsone grantunder this Section. 26 (5) Grant amounts shall not exceed 70% of the 27 project amount, with the remainder to be provided by the 28 municipality as local matching funds. 29 (b) The Agency shall have the authority to enter into 30 any contracts or agreements that may be necessary to carry 31 out its duties or responsibilities under this Section. The 32 Agency shall have the authority to adopt rules setting forth 33 procedures and criteria for administering the Brownfields 34 Redevelopment Grant Program. The rules adopted by the Agency SB75 Engrossed -26- LRB9202721SMdv 1 may include but shall not be limited to the following: 2 (1) purposes for which grants are available; 3 (2) application periods and content of 4 applications; 5 (3) procedures and criteria for Agency review of 6 grant applications, grant approvals and denials, and 7 grantee acceptance; 8 (4) grant payment schedules; 9 (5) grantee responsibilities for work schedules, 10 work plans, reports, and record keeping; 11 (6) evaluation of grantee performance, including 12 but not limited to auditing and access to sites and 13 records; 14 (7) requirements applicable to contracting and 15 subcontracting by the grantee; 16 (8) penalties for noncompliance with grant 17 requirements and conditions, including stop-work orders, 18 termination of grants, and recovery of grant funds; 19 (9) indemnification of this State and the Agency by 20 the grantee; and 21 (10) manner of compliance with the Local Government 22 Professional Services Selection Act. 23 (Source: P.A. 90-123, eff. 7-21-97.) 24 (415 ILCS 5/58.14) 25 Sec. 58.14. Environmental Remediation Tax Credit review. 26 (a) Prior to applying for the Environmental Remediation 27 Tax Credit under Section 201 of the Illinois Income Tax Act, 28 Remediation Applicants shall satisfy the requirements of this 29 Section. The Remediation Applicant shall first submit to the 30 Department of Commerce and Community Affairs an application 31 for review of eligibility for the tax credit. If the 32 Department determines the Remediation Applicant is eligible, 33 the Remediation Applicant shall submit to the Agency an SB75 Engrossed -27- LRB9202721SMdv 1 application for review of remediation costs. The application 2 and review process shall be conducted in accordance with the 3 requirements of this Section and the rules adopted under 4 subsectionssubsection(g) and (h). A preliminary review of 5 the estimated remediation costs for development and 6 implementation of the Remedial Action Plan may be obtained in 7 accordance with subsection (d). 8 (a-3) The Department of Commerce and Community Affairs 9 shall review the eligibility application to determine whether 10 the remediation applicant is eligible for the tax credit. 11 The application shall be on forms prescribed and provided by 12 the Department. At a minimum, the application shall include 13 the following: 14 (1) Information identifying the Remediation 15 Applicant and the site for which the tax credit is being 16 sought. 17 (2) Information demonstrating that the site for 18 which the credit is being sought is abandoned or 19 underutilized property. "Abandoned property" is real 20 property previously used for, or which has the potential 21 to be used for, commercial or industrial purposes that 22 reverted to the ownership of the State, a county or 23 municipal government, or an agency thereof through 24 donation, purchase, tax delinquency, foreclosure, 25 default, or settlement, including conveyance by deed in 26 lieu of foreclosure; or a privately owned property that 27 has been vacant for a period of not less than 3 years 28 from the time an application is made to the Department. 29 "Underutilized property" is real property of which less 30 than 35% of the commercially usable space of the property 31 and improvements thereon are used for their most 32 commercially profitable and economically productive uses. 33 (3) Information demonstrating that remediation of 34 the site for which the credit is being sought will result SB75 Engrossed -28- LRB9202721SMdv 1 in net economic benefit to the State of Illinois. The 2 "net economic benefit" shall be determined based on 3 factors including, but not limited to, the capital 4 investment, the number of jobs created, the number of 5 jobs retained if it is demonstrated the jobs would 6 otherwise be lost, capital improvements, the number of 7 construction-related jobs, increased sales, material 8 purchases, other increases in service and operational 9 expenditures, and other factors established by the 10 Department. Priority shall be given to sites located in 11 areas with high levels of poverty, where the unemployment 12 rate exceeds the State average, where an enterprise zone 13 exists, or where the area is otherwise economically 14 depressed as determined by the Department. 15 (4) An application fee in the amount set forth in 16 subsection (e-5) for each site for which review of an 17 application is being sought. 18 (a-5) Within 60 days after receipt by the Department of 19 Commerce and Community Affairs of an application meeting the 20 requirements of subsection (a-3), the Department shall issue 21 a letter to the applicant approving or disapproving the 22 application for tax credits. If the application is approved, 23 the Department's letter shall also include its determination 24 of the net economic benefit of the remediation project and 25 the amount of tax credits to be made available to the 26 applicant for remediation costs. The amount of tax credits 27 awarded under this Section shall not exceed the net economic 28 benefit of the remediation project, as determined by the 29 Department. 30 (a-7) No application for review of remediation costs 31 shall be submitted to the Agency unless the Department has 32 determined the Remediation Applicant is eligible under 33 subsection (a-5). 34 (b) Except as provided in subsection (b-5), no SB75 Engrossed -29- LRB9202721SMdv 1 application for review of remediation costs shall be 2 submitted until a No Further Remediation Letter has been 3 issued by the Agency and recorded in the chain of title for 4 the site in accordance with Section 58.10. The Agency shall 5 review the application to determine whether the costs 6 submitted are remediation costs, and whether the costs 7 incurred are reasonable. The application shall be on forms 8 prescribed and provided by the Agency. At a minimum, the 9 application shall include the following: 10 (1) information identifying the Remediation 11 Applicant and the site for which the tax credit is being 12 sought and the date of acceptance of the site into the 13 Site Remediation Program; 14 (2) A copy of the No Further Remediation Letter 15 with official verification that the letter has been 16 recorded in the chain of title for the site and a 17 demonstration that the site for which the application is 18 submitted is the same site as the one for which the No 19 Further Remediation Letter is issued; 20 (3) a demonstration that the release of the 21 regulated substances of concern for which the No Further 22 Remediation Letter was issued were not caused or 23 contributed to in any material respect by the Remediation 24 Applicant.After the Pollution Control Board rules are25adopted pursuant to the Illinois Administrative Procedure26Act for the administration and enforcement of Section2758.9 of the Environmental Protection Act,Determinations 28 as to credit availability shall be made consistent with 29thoserules adopted by the Pollution Control Board for 30 the administration and enforcement of Section 58.9 of 31 this Act; 32 (3.5) a copy of the Department of Commerce and 33 Community Affairs' letter approving eligibility, 34 including the net economic benefit of the remediation SB75 Engrossed -30- LRB9202721SMdv 1 project; 2 (4) an itemization and documentation, including 3 receipts, of the remediation costs incurred; 4 (5) a demonstration that the costs incurred are 5 remediation costs as defined in this Act and its rules; 6 (6) a demonstration that the costs submitted for 7 review were incurred by the Remediation Applicantwho8received the No Further Remediation Letter; 9 (7) an application fee in the amount set forth in 10 subsection (e) for each site for which review of 11 remediation costs is requestedand, if applicable,12certification from the Department of Commerce and13Community Affairs that the site is located in an14enterprise zone; and 15 (8) any other information deemed appropriate by the 16 Agency. 17 (b-5) An application for review of remediation costs may 18 be submitted to the Agency prior to the issuance of a No 19 Further Remediation Letter if the Remediation Applicant has a 20 Remedial Action Plan approved by the Agency under the terms 21 of which the Remediation Applicant will remediate groundwater 22 for more than one year. The Agency shall review the 23 application to determine whether the costs submitted are 24 remediation costs, and whether the costs incurred are 25 reasonable. The application shall be on forms prescribed and 26 provided by the Agency. At a minimum, the application shall 27 include the following: 28 (1) Information identifying the Remediation 29 Applicant and the site for which the tax credit is being 30 sought and the date of acceptance of the site into the 31 Site Remediation Program. 32 (2) A copy of the Agency letter approving the 33 Remedial Action Plan. 34 (3) A demonstration that the release of the SB75 Engrossed -31- LRB9202721SMdv 1 regulated substances of concern for which the Remedial 2 Action Plan was approved were not caused or contributed 3 to in any material respect by the Remediation Applicant. 4 Determinations as to credit availability shall be made 5 consistent with rules adopted by the Pollution Control 6 Board for the administration and enforcement of Section 7 58.9 of this Act. 8 (4) A copy of the Department of Commerce and 9 Community Affairs' letter approving eligibility, 10 including the net economic benefit of the remediation 11 project. 12 (5) An itemization and documentation, including 13 receipts, of the remediation costs incurred. 14 (6) A demonstration that the costs incurred are 15 remediation costs as defined in this Act and rules 16 adopted under this Act. 17 (7) A demonstration that the costs submitted for 18 review were incurred by the Remediation Applicant who 19 received approval of the Remediation Action Plan. 20 (8) An application fee in the amount set forth in 21 subsection (e) for each site for which review of 22 remediation costs is requested. 23 (9) Any other information deemed appropriate by the 24 Agency. 25 (c) Within 60 days after receipt by the Agency of an 26 application meeting the requirements of subsections 27subsection(b) or (b-5), the Agency shall issue a letter to 28 the applicant approving, disapproving, or modifying the 29 remediation costs submitted in the application.If the30remediation costs are approved as submitted, the Agency's31letter shall state the amount of the remediation costs to be32applied toward the Environmental Remediation Tax Credit.If 33 an application is disapproved or approved with modification 34 of remediation costs, the Agency's letter shall set forth the SB75 Engrossed -32- LRB9202721SMdv 1 reasons for the disapproval or modificationand state the2amount of the remediation costs, if any, to be applied toward3the Environmental Remediation Tax Credit. 4 If a preliminary review of a budget plan has been 5 obtained under subsection (d), the Remediation Applicant may 6 submit, with the application and supporting documentation 7 under subsectionssubsection(b) or (b-5), a copy of the 8 Agency's final determination accompanied by a certification 9 that the actual remediation costs incurred for the 10 development and implementation of the Remedial Action Plan 11 are equal to or less than the costs approved in the Agency's 12 final determination on the budget plan. The certification 13 shall be signed by the Remediation Applicant and notarized. 14 Based on that submission, the Agency shall not be required to 15 conduct further review of the costs incurred for development 16 and implementation of the Remedial Action Plan and may 17 approve costs as submitted. 18 Within 35 days after receipt of an Agency letter 19 disapproving or modifying an application for approval of 20 remediation costs, the Remediation Applicant may appeal the 21 Agency's decision to the Board in the manner provided for the 22 review of permits in Section 40 of this Act. 23 (d) (1) A Remediation Applicant may obtain a preliminary 24 review of estimated remediation costs for the development 25 and implementation of the Remedial Action Plan by 26 submitting a budget plan along with the Remedial Action 27 Plan. The budget plan shall be set forth on forms 28 prescribed and provided by the Agency and shall include 29 but shall not be limited to line item estimates of the 30 costs associated with each line item (such as personnel, 31 equipment, and materials) that the Remediation Applicant 32 anticipates will be incurred for the development and 33 implementation of the Remedial Action Plan. The Agency 34 shall review the budget plan along with the Remedial SB75 Engrossed -33- LRB9202721SMdv 1 Action Plan to determine whether the estimated costs 2 submitted are remediation costs and whether the costs 3 estimated for the activities are reasonable. 4 (2) If the Remedial Action Plan is amended by the 5 Remediation Applicant or as a result of Agency action, 6 the corresponding budget plan shall be revised 7 accordingly and resubmitted for Agency review. 8 (3) The budget plan shall be accompanied by the 9 applicable fee as set forth in subsection (e). 10 (4) Submittal of a budget plan shall be deemed an 11 automatic 60-day waiver of the Remedial Action Plan 12 review deadlines set forth in this Section and its rules. 13 (5) Within the applicable period of review, the 14 Agency shall issue a letter to the Remediation Applicant 15 approving, disapproving, or modifying the estimated 16 remediation costs submitted in the budget plan. If a 17 budget plan is disapproved or approved with modification 18 of estimated remediation costs, the Agency's letter shall 19 set forth the reasons for the disapproval or 20 modification. 21 (6) Within 35 days after receipt of an Agency 22 letter disapproving or modifying a budget plan, the 23 Remediation Applicant may appeal the Agency's decision to 24 the Board in the manner provided for the review of 25 permits in Section 40 of this Act. 26 (e) The fees for reviews conducted by the Agency under 27 this Section are in addition to any other fees or payments 28 for Agency services rendered pursuant to the Site Remediation 29 Program and shall be as follows: 30 (1) The fee for an application for review of 31 remediation costs shall be $1,000 for each site reviewed. 32 (2) The fee for the review of the budget plan 33 submitted under subsection (d) shall be $500 for each 34 site reviewed. SB75 Engrossed -34- LRB9202721SMdv 1(3) In the case of a Remediation Applicant2submitting for review total remediation costs of $100,0003or less for a site located within an enterprise zone (as4set forth in paragraph (i) of subsection (l) of Section5201 of the Illinois Income Tax Act), the fee for an6application for review of remediation costs shall be $2507for each site reviewed. For those sites, there shall be8no fee for review of a budget plan under subsection (d).9 The application fee shall be made payable to the State of 10 Illinois, for deposit into the Hazardous Waste Fund. 11 Pursuant to appropriation, the Agency shall use the fees 12 collected under this subsection for development and 13 administration of the review program. 14 (e-5) The fee for eligibility reviews conducted by the 15 Department of Commerce and Community Affairs under this 16 Section shall be $1,000 for each site reviewed. The 17 application fee shall be made payable to the Department of 18 Commerce and Community Affairs for deposit into the 19 Distressed Communities and Industries Fund. Subject to 20 appropriation, the Department of Commerce and Community 21 Affairs shall use the fees collected under this subsection 22 for development and administration of the review program. 23 (f) The Department of Commerce and Community Affairs and 24 the Agency shall have the authority to enter into any 25 contracts or agreements that may be necessary to carry out 26 theiritsduties and responsibilities under this Section. 27 (f-5) The Distressed Communities and Industries Fund. 28 (1) The Distressed Communities and Industries Fund 29 is created as a special fund in the State treasury to be 30 used exclusively for the purposes of this Section, 31 including payment for the costs of administering this 32 Act. The Fund shall be administered by the Department. 33 (2) The Fund consists of collected fees, 34 appropriations from the General Assembly, and gifts and SB75 Engrossed -35- LRB9202721SMdv 1 grants to the Fund. 2 (3) The State Treasurer shall invest the money in 3 the Fund not currently needed to meet the obligations of 4 the Fund in the same manner as other public funds may be 5 invested. All interest earned on moneys in the Fund 6 shall be deposited into the Fund. 7 (4) The money in the Fund at the end of a State 8 fiscal year must remain in the Fund to be used 9 exclusively for the purposes of this Section. 10 Expenditures from the Fund are subject to appropriation 11 by the General Assembly. 12 (g) Within 6 months after the effective date of this 13 amendatory Act of 1997, the Agency shall propose rules 14 prescribing procedures and standards for its administration 15 of this Section. Within 6 months after receipt of the 16 Agency's proposed rules, the Board shall adopt on second 17 notice, pursuant to Sections 27 and 28 of this Act and the 18 Illinois Administrative Procedure Act, rules that are 19 consistent with this Section. Prior to the effective date of 20 rules adopted under this Section, the Agency may conduct 21 reviews of applications under this Section and the Agency is 22 further authorized to distribute guidance documents on costs 23 that are eligible or ineligible as remediation costs. 24 (h) Within 6 months after the effective date of this 25 amendatory Act of the 92nd General Assembly, the Agency and 26 the Department of Commerce and Community Affairs shall 27 propose rules prescribing procedures and standards for the 28 administration of this Section as changed by this amendatory 29 Act of the 92nd General Assembly. Within 6 months after 30 receipt of the proposed rules, the Board shall adopt on 31 second notice, pursuant to Sections 27 and 28 of this Act and 32 the Illinois Administrative Procedure Act, rules that are 33 consistent with this Section as changed by this amendatory 34 Act of the 92nd General Assembly. Prior to the effective SB75 Engrossed -36- LRB9202721SMdv 1 date of rules adopted under this subsection (h), the Agency 2 and the Department of Commerce and Community Affairs may 3 conduct reviews of applications under this Section and the 4 Agency is further authorized to distribute guidance documents 5 on costs that are eligible or ineligible as remediation 6 costs. 7 (i) The changes relating to taxes made to this Section 8 by this amendatory Act of the 92nd General Assembly apply to 9 taxable years ending on or after December 31, 2001. 10 (Source: P.A. 90-123, eff. 7-21-97; 90-792, eff. 1-1-99.) 11 Section 30. The Response Action Contractor 12 Indemnification Act is amended by changing Section 5 as 13 follows: 14 (415 ILCS 100/5) (from Ch. 111 1/2, par. 7205) 15 Sec. 5. Response Contractors Indemnification Fund. 16 (a) There is hereby created the Response Contractors 17 Indemnification Fund. The State Treasurer, ex officio, shall 18 be custodian of the Fund, and the Comptroller shall direct 19 payments from the Fund upon vouchers properly certified by 20 the Attorney General in accordance with Section 4. The 21 Treasurer shall credit interest on the Fund to the Fund. 22 (b) Every State response action contract shall provide 23 that 5% of each payment to be made by the State under the 24 contract shall be paid by the State directly into the 25 Response Contractors Indemnification Fund rather than to the 26 contractor, except that when there is more than $2,000,000 27$4,000,000in the Fund at the beginning of a State fiscal 28 year, State response action contracts during that fiscal year 29 need not provide that 5% of each payment made under the 30 contract be paid into the Fund. When only a portion of a 31 contract relates to a remedial or response action, or to the 32 identification, handling, storage, treatment or disposal of a SB75 Engrossed -37- LRB9202721SMdv 1 pollutant, the contract shall provide that only that portion 2 is subject to this subsection. 3 (c) Within 30 days after the effective date of this 4 amendatory Act of 1997, the Comptroller shall order 5 transferred and the Treasurer shall transfer $1,200,000 from 6 the Response Contractors Indemnification Fund to the 7 Brownfields Redevelopment Fund. The Comptroller shall order 8 transferred and the Treasurer shall transfer $1,200,000 from 9 the Response Contractors Indemnification Fund to the 10 Brownfields Redevelopment Fund on the first day of fiscal 11 years 1999, 2000, 2001,and2002, 2003, 2004, and 2005. 12 (d) Within 30 days after the effective date of this 13 amendatory Act of the 91st General Assembly, the Comptroller 14 shall order transferred and the Treasurer shall transfer 15 $2,000,000 from the Response Contractors Indemnification Fund 16 to the Asbestos Abatement Fund. 17 (Source: P.A. 90-123, eff. 7-21-97; 91-704, eff. 7-1-00.)