Bill Amendment: IL HB0162 | 2017-2018 | 100th General Assembly

NOTE: For additional amemendments please see the Bill Drafting List

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Bill Title: REVENUE-TECH

Status: 2017-09-18 - Added as Alternate Co-Sponsor Sen. Terry Link [HB0162 Detail]

Download: Illinois-2017-HB0162-House_Amendment_002.html

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Rep. Michael J. Zalewski

Filed: 6/27/2017

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AMENDMENT TO HOUSE BILL 162
AMENDMENT NO. ______. Amend House Bill 162 by replacing
everything after the enacting clause with the following:
"ARTICLE 3. KEEP ILLINOIS BUSINESSES ACT
Section 3-1. Short title. This Act may be cited as the Keep
Illinois Businesses Act.
Section 3-5. Purpose. The purpose of this Act is to
encourage businesses with primary business operations in the
State of Illinois to remain in this State by removing and
recouping any economic development assistance or benefit
provided to those businesses by the State should those
businesses decide to relocate jobs out-of-State.
Section 3-10. Definitions. As used in this Act:
"Economic development assistance" means (1) tax credits

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and tax exemptions given as an incentive to a recipient
business organization under an initial certification or an
initial designation made by the Department of Commerce and
Economic Opportunity under the Economic Development for a
Growing Economy Tax Credit Act, River Edge Redevelopment Zone
Act, and the Illinois Enterprise Zone Act, including the High
Impact Business program; (2) grants or loans given to a
recipient as an incentive to a business organization under the
River Edge Redevelopment Zone Act, Large Business Development
Program, the Business Development Public Infrastructure
Program, or the Industrial Training Program; (3) the State
Treasurer's Economic Program Loans; (4) the Illinois
Department of Transportation Economic Development Program; (5)
all successor and subsequent programs and tax credits designed
to promote business relocations and expansions; (6) any
assistance provided by the Illinois Emergency Employment
Program under the Illinois Emergency Development Act; and (7)
any other economic incentive, benefit, assistance, credit,
loan, or grant provided by a State granting agency to a
recipient business with primary business operations in this
State.
"Recipient business" means any corporation, limited
liability company, partnership, joint venture, association,
sole proprietorship, or other legally recognized entity with
primary business operations in this State that receives
economic development assistance.

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"State agency" has the meaning provided in Section 1-7 of
the Illinois State Auditing Act.
"State granting agency" means any State department or State
agency that provides economic development assistance to a
recipient business.
Section 3-15. Recovery of economic development assistance.
(a) Subject to the procedures outlined in this Section, any
recipient business that chooses to move all or part of its
business operations and the jobs created by its business
out-of-State shall be deemed to no longer qualify for State
economic development assistance, and shall be required to pay
to the relevant State granting agency the full amount of any
economic development assistance it received.
(b) Whenever a State granting agency believes that the
economic development assistance it provided to a recipient
business is subject to recovery, the State granting agency
shall provide the recipient business the opportunity for at
least one informal hearing to determine the facts and issues,
and to resolve any conflicts as amicably as possible before
taking any formal recovery actions.
(c) If a State granting agency determines that economic
development assistance is to be recovered, then, prior to
taking any action to recover, the State granting agency shall
provide the recipient business with a written notice of the
intended recovery. This notice shall identify the funds and the

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amount to be recovered and the specific facts which permit
recovery.
(d) A recipient business shall have 35 days from the
receipt of the notice required in subsection (c) of this
Section to request a hearing to show why recovery is not
justified or proper. If a recipient business requests a hearing
under this subsection (d), then:
(1) the State granting agency shall hold a hearing
before the Director of that agency, or his or her designee,
at which a representative of the recipient business may
present an argument for why recovery should not be
permitted; and
(2) after the conclusion of the hearing, the Director
of the State granting agency, or his or her designee, shall
issue a written final recovery order and send a copy of the
order to the recipient business.
(e) A recipient business may seek judicial review of any
final recovery order under the provisions of the Administrative
Review Law.
(f) If a recipient business requests a hearing under
subsection (d) of this Section, then the State granting agency
may not take any action of recovery until at least 35 days
after the State granting agency has issued a final recovery
order under the requirements of subsection (d) of this Section.
If a recipient business does not request a hearing as permitted
in subsection (d) of this Section, then the State granting

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agency may proceed with recovery of the economic development
assistance amount specified in the notice issued under the
requirements of subsection (c) of this Section, at any time
after the expiration of the 35-day request period established
in subsection (d) of this Section.
(g) Any notice or mailing required or permitted by this
Section shall be deemed received 5 days after the notice or
mailing is deposited in the United States mail, properly
addressed with the current business address of the recipient
business and with sufficient U.S. postage affixed.
ARTICLE 5. AMENDATORY PROVISIONS
Section 5-5. The Illinois Income Tax Act is amended by
changing Section 704A as follows:
(35 ILCS 5/704A)
Sec. 704A. Employer's return and payment of tax withheld.
(a) In general, every employer who deducts and withholds or
is required to deduct and withhold tax under this Act on or
after January 1, 2008 shall make those payments and returns as
provided in this Section.
(b) Returns. Every employer shall, in the form and manner
required by the Department, make returns with respect to taxes
withheld or required to be withheld under this Article 7 for
each quarter beginning on or after January 1, 2008, on or

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before the last day of the first month following the close of
that quarter.
(c) Payments. With respect to amounts withheld or required
to be withheld on or after January 1, 2008:
(1) Semi-weekly payments. For each calendar year, each
employer who withheld or was required to withhold more than
$12,000 during the one-year period ending on June 30 of the
immediately preceding calendar year, payment must be made:
(A) on or before each Friday of the calendar year,
for taxes withheld or required to be withheld on the
immediately preceding Saturday, Sunday, Monday, or
Tuesday;
(B) on or before each Wednesday of the calendar
year, for taxes withheld or required to be withheld on
the immediately preceding Wednesday, Thursday, or
Friday.
Beginning with calendar year 2011, payments made under
this paragraph (1) of subsection (c) must be made by
electronic funds transfer.
(2) Semi-weekly payments. Any employer who withholds
or is required to withhold more than $12,000 in any quarter
of a calendar year is required to make payments on the
dates set forth under item (1) of this subsection (c) for
each remaining quarter of that calendar year and for the
subsequent calendar year.
(3) Monthly payments. Each employer, other than an

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employer described in items (1) or (2) of this subsection,
shall pay to the Department, on or before the 15th day of
each month the taxes withheld or required to be withheld
during the immediately preceding month.
(4) Payments with returns. Each employer shall pay to
the Department, on or before the due date for each return
required to be filed under this Section, any tax withheld
or required to be withheld during the period for which the
return is due and not previously paid to the Department.
(d) Regulatory authority. The Department may, by rule:
(1) Permit employers, in lieu of the requirements of
subsections (b) and (c), to file annual returns due on or
before January 31 of the year for taxes withheld or
required to be withheld during the previous calendar year
and, if the aggregate amounts required to be withheld by
the employer under this Article 7 (other than amounts
required to be withheld under Section 709.5) do not exceed
$1,000 for the previous calendar year, to pay the taxes
required to be shown on each such return no later than the
due date for such return.
(2) Provide that any payment required to be made under
subsection (c)(1) or (c)(2) is deemed to be timely to the
extent paid by electronic funds transfer on or before the
due date for deposit of federal income taxes withheld from,
or federal employment taxes due with respect to, the wages
from which the Illinois taxes were withheld.

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(3) Designate one or more depositories to which payment
of taxes required to be withheld under this Article 7 must
be paid by some or all employers.
(4) Increase the threshold dollar amounts at which
employers are required to make semi-weekly payments under
subsection (c)(1) or (c)(2).
(e) Annual return and payment. Every employer who deducts
and withholds or is required to deduct and withhold tax from a
person engaged in domestic service employment, as that term is
defined in Section 3510 of the Internal Revenue Code, may
comply with the requirements of this Section with respect to
such employees by filing an annual return and paying the taxes
required to be deducted and withheld on or before the 15th day
of the fourth month following the close of the employer's
taxable year. The Department may allow the employer's return to
be submitted with the employer's individual income tax return
or to be submitted with a return due from the employer under
Section 1400.2 of the Unemployment Insurance Act.
(f) Magnetic media and electronic filing. Any W-2 Form
that, under the Internal Revenue Code and regulations
promulgated thereunder, is required to be submitted to the
Internal Revenue Service on magnetic media or electronically
must also be submitted to the Department on magnetic media or
electronically for Illinois purposes, if required by the
Department.
(g) For amounts deducted or withheld after December 31,

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2009, a taxpayer who makes an election under subsection (f) of
Section 5-15 of the Economic Development for a Growing Economy
Tax Credit Act for a taxable year shall be allowed a credit
against payments due under this Section for amounts withheld
during the first calendar year beginning after the end of that
taxable year equal to the amount of the credit for the
incremental income tax attributable to full-time employees of
the taxpayer awarded to the taxpayer by the Department of
Commerce and Economic Opportunity under the Economic
Development for a Growing Economy Tax Credit Act for the
taxable year and credits not previously claimed and allowed to
be carried forward under Section 211(4) of this Act as provided
in subsection (f) of Section 5-15 of the Economic Development
for a Growing Economy Tax Credit Act. The credit or credits may
not reduce the taxpayer's obligation for any payment due under
this Section to less than zero. If the amount of the credit or
credits exceeds the total payments due under this Section with
respect to amounts withheld during the calendar year, the
excess may be carried forward and applied against the
taxpayer's liability under this Section in the succeeding
calendar years as allowed to be carried forward under paragraph
(4) of Section 211 of this Act. The credit or credits shall be
applied to the earliest year for which there is a tax
liability. If there are credits from more than one taxable year
that are available to offset a liability, the earlier credit
shall be applied first. Each employer who deducts and withholds

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or is required to deduct and withhold tax under this Act and
who retains income tax withholdings under subsection (f) of
Section 5-15 of the Economic Development for a Growing Economy
Tax Credit Act must make a return with respect to such taxes
and retained amounts in the form and manner that the
Department, by rule, requires and pay to the Department or to a
depositary designated by the Department those withheld taxes
not retained by the taxpayer. For purposes of this subsection
(g), the term taxpayer shall include taxpayer and members of
the taxpayer's unitary business group as defined under
paragraph (27) of subsection (a) of Section 1501 of this Act.
This Section is exempt from the provisions of Section 250 of
this Act. No credit awarded under the Economic Development for
a Growing Economy Tax Credit Act for agreements entered into on
or after January 1, 2015 may be credited against payments due
under this Section.
(h) An employer may claim a credit against payments due
under this Section for amounts withheld during the first
calendar year ending after the date on which a tax credit
certificate was issued under Section 35 of the Small Business
Job Creation Tax Credit Act. The credit shall be equal to the
amount shown on the certificate, but may not reduce the
taxpayer's obligation for any payment due under this Section to
less than zero. If the amount of the credit exceeds the total
payments due under this Section with respect to amounts
withheld during the calendar year, the excess may be carried

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forward and applied against the taxpayer's liability under this
Section in the 5 succeeding calendar years. The credit shall be
applied to the earliest year for which there is a tax
liability. If there are credits from more than one calendar
year that are available to offset a liability, the earlier
credit shall be applied first. This Section is exempt from the
provisions of Section 250 of this Act.
(Source: P.A. 96-834, eff. 12-14-09; 96-888, eff. 4-13-10;
96-905, eff. 6-4-10; 96-1027, eff. 7-12-10; 97-333, eff.
8-12-11; 97-507, eff. 8-23-11.)
Section 5-10. The Economic Development for a Growing
Economy Tax Credit Act is amended by changing Sections 5-5,
5-15, 5-20, 5-25, 5-50, 5-65, 5-70 and 5-77 and by adding
Section 5-57 as follows:
(35 ILCS 10/5-5)
Sec. 5-5. Definitions. As used in this Act:
"Agreement" means the Agreement between a Taxpayer and the
Department under the provisions of Section 5-50 of this Act.
"Applicant" means a Taxpayer that is operating a business
located or that the Taxpayer plans to locate within the State
of Illinois and that is engaged in interstate or intrastate
commerce for the purpose of manufacturing, processing,
assembling, warehousing, or distributing products, conducting
research and development, providing tourism services, or

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providing services in interstate commerce, office industries,
or agricultural processing, but excluding retail, retail food,
health, or professional services. "Applicant" does not include
a Taxpayer who closes or substantially reduces an operation at
one location in the State and relocates substantially the same
operation to another location in the State. This does not
prohibit a Taxpayer from expanding its operations at another
location in the State, provided that existing operations of a
similar nature located within the State are not closed or
substantially reduced. This also does not prohibit a Taxpayer
from moving its operations from one location in the State to
another location in the State for the purpose of expanding the
operation provided that the Department determines that
expansion cannot reasonably be accommodated within the
municipality in which the business is located, or in the case
of a business located in an incorporated area of the county,
within the county in which the business is located, after
conferring with the chief elected official of the municipality
or county and taking into consideration any evidence offered by
the municipality or county regarding the ability to accommodate
expansion within the municipality or county.
"Committee" means the Illinois Business Investment
Committee created under Section 5-25 of this Act within the
Illinois Economic Development Board.
"Credit" means the amount agreed to between the Department
and Applicant under this Act, but not to exceed the lesser of:

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(1) the sum of (i) 50% of the Incremental Income Tax
attributable to New Employees at the Applicant's project and
(ii) 10% of the training costs of New Employees; or (2) 100% of
the Incremental Income Tax attributable to New Employees at the
Applicant's project. However, if the project is located in an
underserved area, then the amount of the Credit may not exceed
the lesser of: (1) the sum of (i) 75% of the Incremental Income
Tax attributable to New Employees at the Applicant's project
and (ii) 10% of the training costs of New Employees; or (2)
100% of the Incremental Income Tax attributable to New
Employees at the Applicant's project. If an Applicant agrees to
hire the required number of New Employees, then the maximum
amount of the Credit for that Applicant may be increased by an
amount not to exceed 25% of the Incremental Income Tax
attributable to retained employees at the Applicant's project;
provided that, in order to receive the increase for retained
employees, the Applicant must provide the additional evidence
required under paragraph (3) of subsection (b) of Section 5-25.
"Department" means the Department of Commerce and Economic
Opportunity.
"Director" means the Director of Commerce and Economic
Opportunity.
"Full-time Employee" means an individual who is employed
for consideration for at least 35 hours each week or who
renders any other standard of service generally accepted by
industry custom or practice as full-time employment. An

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individual for whom a W-2 is issued by a Professional Employer
Organization (PEO) is a full-time employee if employed in the
service of the Applicant for consideration for at least 35
hours each week or who renders any other standard of service
generally accepted by industry custom or practice as full-time
employment to Applicant.
"Incremental Income Tax" means the total amount withheld
during the taxable year from the compensation of New Employees
and, if applicable, retained employees under Article 7 of the
Illinois Income Tax Act arising from employment at a project
that is the subject of an Agreement.
"New Employee" means:
(a) A Full-time Employee first employed by a Taxpayer
in the project that is the subject of an Agreement and who
is hired after the Taxpayer enters into the tax credit
Agreement.
(b) The term "New Employee" does not include:
(1) an employee of the Taxpayer who performs a job
that was previously performed by another employee, if
that job existed for at least 6 months before hiring
the employee;
(2) an employee of the Taxpayer who was previously
employed in Illinois by a Related Member of the
Taxpayer and whose employment was shifted to the
Taxpayer after the Taxpayer entered into the tax credit
Agreement; or

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(3) a child, grandchild, parent, or spouse, other
than a spouse who is legally separated from the
individual, of any individual who has a direct or an
indirect ownership interest of at least 5% in the
profits, capital, or value of the Taxpayer.
(c) Notwithstanding paragraph (1) of subsection (b),
an employee may be considered a New Employee under the
Agreement if the employee performs a job that was
previously performed by an employee who was:
(1) treated under the Agreement as a New Employee;
and
(2) promoted by the Taxpayer to another job.
(d) Notwithstanding subsection (a), the Department may
award Credit to an Applicant with respect to an employee
hired prior to the date of the Agreement if:
(1) the Applicant is in receipt of a letter from
the Department stating an intent to enter into a credit
Agreement;
(2) the letter described in paragraph (1) is issued
by the Department not later than 15 days after the
effective date of this Act; and
(3) the employee was hired after the date the
letter described in paragraph (1) was issued.
"Noncompliance Date" means, in the case of a Taxpayer that
is not complying with the requirements of the Agreement or the
provisions of this Act, the day following the last date upon

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which the Taxpayer was in compliance with the requirements of
the Agreement and the provisions of this Act, as determined by
the Director, pursuant to Section 5-65.
"Pass Through Entity" means an entity that is exempt from
the tax under subsection (b) or (c) of Section 205 of the
Illinois Income Tax Act.
"Professional Employer Organization" (PEO) means an
employee leasing company, as defined in Section 206.1(A)(2) of
the Illinois Unemployment Insurance Act.
"Related Member" means a person that, with respect to the
Taxpayer during any portion of the taxable year, is any one of
the following:
(1) An individual stockholder, if the stockholder and
the members of the stockholder's family (as defined in
Section 318 of the Internal Revenue Code) own directly,
indirectly, beneficially, or constructively, in the
aggregate, at least 50% of the value of the Taxpayer's
outstanding stock.
(2) A partnership, estate, or trust and any partner or
beneficiary, if the partnership, estate, or trust, and its
partners or beneficiaries own directly, indirectly,
beneficially, or constructively, in the aggregate, at
least 50% of the profits, capital, stock, or value of the
Taxpayer.
(3) A corporation, and any party related to the
corporation in a manner that would require an attribution

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of stock from the corporation to the party or from the
party to the corporation under the attribution rules of
Section 318 of the Internal Revenue Code, if the Taxpayer
owns directly, indirectly, beneficially, or constructively
at least 50% of the value of the corporation's outstanding
stock.
(4) A corporation and any party related to that
corporation in a manner that would require an attribution
of stock from the corporation to the party or from the
party to the corporation under the attribution rules of
Section 318 of the Internal Revenue Code, if the
corporation and all such related parties own in the
aggregate at least 50% of the profits, capital, stock, or
value of the Taxpayer.
(5) A person to or from whom there is attribution of
stock ownership in accordance with Section 1563(e) of the
Internal Revenue Code, except, for purposes of determining
whether a person is a Related Member under this paragraph,
20% shall be substituted for 5% wherever 5% appears in
Section 1563(e) of the Internal Revenue Code.
"Taxpayer" means an individual, corporation, partnership,
or other entity that has any Illinois Income Tax liability.
"Underserved area" means a geographic area that meets one
or more of the following conditions:
(1) the area has a poverty rate of at least 20%
according to the latest federal decennial census;

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(2) 75% or more of the children in the area participate
in the federal free lunch program according to reported
statistics from the State Board of Education;
(3) at least 20% of the households in the area receive
assistance under the Supplemental Nutrition Assistance
Program (SNAP); or
(4) the area has an average unemployment rate, as
determined by the Illinois Department of Employment
Security, that is more than 120% of the national
unemployment average, as determined by the U.S. Department
of Labor, for a period of at least 2 consecutive calendar
years preceding the date of the application.
(Source: P.A. 94-793, eff. 5-19-06; 95-375, eff. 8-23-07.)
(35 ILCS 10/5-15)
Sec. 5-15. Tax Credit Awards. Subject to the conditions set
forth in this Act, a Taxpayer is entitled to a Credit against
or, as described in subsection (g) of this Section, a payment
towards taxes imposed pursuant to subsections (a) and (b) of
Section 201 of the Illinois Income Tax Act that may be imposed
on the Taxpayer for a taxable year beginning on or after
January 1, 1999, if the Taxpayer is awarded a Credit by the
Department under this Act for that taxable year.
(a) The Department shall make Credit awards under this Act
to foster job creation and retention in Illinois.
(b) A person that proposes a project to create new jobs in

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Illinois must enter into an Agreement with the Department for
the Credit under this Act.
(c) The Credit shall be claimed for the taxable years
specified in the Agreement.
(d) The Credit shall not exceed the Incremental Income Tax
attributable to the project that is the subject of the
Agreement.
(e) Nothing herein shall prohibit a Tax Credit Award to an
Applicant that uses a PEO if all other award criteria are
satisfied.
(f) In lieu of the Credit allowed under this Act against
the taxes imposed pursuant to subsections (a) and (b) of
Section 201 of the Illinois Income Tax Act for any taxable year
ending on or after December 31, 2009, for Taxpayers that
entered into Agreements prior to January 1, 2015 and otherwise
meet the criteria set forth in this subsection (f), the
Taxpayer may elect to claim the Credit against its obligation
to pay over withholding under Section 704A of the Illinois
Income Tax Act.
(1) The election under this subsection (f) may be made
only by a Taxpayer that (i) is primarily engaged in one of
the following business activities: water purification and
treatment, motor vehicle metal stamping, automobile
manufacturing, automobile and light duty motor vehicle
manufacturing, motor vehicle manufacturing, light truck
and utility vehicle manufacturing, heavy duty truck

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manufacturing, motor vehicle body manufacturing, cable
television infrastructure design or manufacturing, or
wireless telecommunication or computing terminal device
design or manufacturing for use on public networks and (ii)
meets the following criteria:
(A) the Taxpayer (i) had an Illinois net loss or an
Illinois net loss deduction under Section 207 of the
Illinois Income Tax Act for the taxable year in which
the Credit is awarded, (ii) employed a minimum of 1,000
full-time employees in this State during the taxable
year in which the Credit is awarded, (iii) has an
Agreement under this Act on December 14, 2009 (the
effective date of Public Act 96-834), and (iv) is in
compliance with all provisions of that Agreement;
(B) the Taxpayer (i) had an Illinois net loss or an
Illinois net loss deduction under Section 207 of the
Illinois Income Tax Act for the taxable year in which
the Credit is awarded, (ii) employed a minimum of 1,000
full-time employees in this State during the taxable
year in which the Credit is awarded, and (iii) has
applied for an Agreement within 365 days after December
14, 2009 (the effective date of Public Act 96-834);
(C) the Taxpayer (i) had an Illinois net operating
loss carryforward under Section 207 of the Illinois
Income Tax Act in a taxable year ending during calendar
year 2008, (ii) has applied for an Agreement within 150

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days after the effective date of this amendatory Act of
the 96th General Assembly, (iii) creates at least 400
new jobs in Illinois, (iv) retains at least 2,000 jobs
in Illinois that would have been at risk of relocation
out of Illinois over a 10-year period, and (v) makes a
capital investment of at least $75,000,000;
(D) the Taxpayer (i) had an Illinois net operating
loss carryforward under Section 207 of the Illinois
Income Tax Act in a taxable year ending during calendar
year 2009, (ii) has applied for an Agreement within 150
days after the effective date of this amendatory Act of
the 96th General Assembly, (iii) creates at least 150
new jobs, (iv) retains at least 1,000 jobs in Illinois
that would have been at risk of relocation out of
Illinois over a 10-year period, and (v) makes a capital
investment of at least $57,000,000; or
(E) the Taxpayer (i) employed at least 2,500
full-time employees in the State during the year in
which the Credit is awarded, (ii) commits to make at
least $500,000,000 in combined capital improvements
and project costs under the Agreement, (iii) applies
for an Agreement between January 1, 2011 and June 30,
2011, (iv) executes an Agreement for the Credit during
calendar year 2011, and (v) was incorporated no more
than 5 years before the filing of an application for an
Agreement.

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(1.5) The election under this subsection (f) may also
be made by a Taxpayer for any Credit awarded pursuant to an
agreement that was executed between January 1, 2011 and
June 30, 2011, if the Taxpayer (i) is primarily engaged in
the manufacture of inner tubes or tires, or both, from
natural and synthetic rubber, (ii) employs a minimum of
2,400 full-time employees in Illinois at the time of
application, (iii) creates at least 350 full-time jobs and
retains at least 250 full-time jobs in Illinois that would
have been at risk of being created or retained outside of
Illinois, and (iv) makes a capital investment of at least
$200,000,000 at the project location.
(1.6) The election under this subsection (f) may also
be made by a Taxpayer for any Credit awarded pursuant to an
agreement that was executed within 150 days after the
effective date of this amendatory Act of the 97th General
Assembly, if the Taxpayer (i) is primarily engaged in the
operation of a discount department store, (ii) maintains
its corporate headquarters in Illinois, (iii) employs a
minimum of 4,250 full-time employees at its corporate
headquarters in Illinois at the time of application, (iv)
retains at least 4,250 full-time jobs in Illinois that
would have been at risk of being relocated outside of
Illinois, (v) had a minimum of $40,000,000,000 in total
revenue in 2010, and (vi) makes a capital investment of at
least $300,000,000 at the project location.

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(1.7) Notwithstanding any other provision of law, the
election under this subsection (f) may also be made by a
Taxpayer for any Credit awarded pursuant to an agreement
that was executed or applied for on or after July 1, 2011
and on or before March 31, 2012, if the Taxpayer is
primarily engaged in the manufacture of original and
aftermarket filtration parts and products for automobiles,
motor vehicles, light duty motor vehicles, light trucks and
utility vehicles, and heavy duty trucks, (ii) employs a
minimum of 1,000 full-time employees in Illinois at the
time of application, (iii) creates at least 250 full-time
jobs in Illinois, (iv) relocates its corporate
headquarters to Illinois from another state, and (v) makes
a capital investment of at least $4,000,000 at the project
location.
(2) An election under this subsection shall allow the
credit to be taken against payments otherwise due under
Section 704A of the Illinois Income Tax Act during the
first calendar year beginning after the end of the taxable
year in which the credit is awarded under this Act.
(3) The election shall be made in the form and manner
required by the Illinois Department of Revenue and, once
made, shall be irrevocable.
(4) If a Taxpayer who meets the requirements of
subparagraph (A) of paragraph (1) of this subsection (f)
elects to claim the Credit against its withholdings as

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provided in this subsection (f), then, on and after the
date of the election, the terms of the Agreement between
the Taxpayer and the Department may not be further amended
during the term of the Agreement.
(g) A pass-through entity that has been awarded a credit
under this Act, its shareholders, or its partners may treat
some or all of the credit awarded pursuant to this Act as a tax
payment for purposes of the Illinois Income Tax Act. The term
"tax payment" means a payment as described in Article 6 or
Article 8 of the Illinois Income Tax Act or a composite payment
made by a pass-through entity on behalf of any of its
shareholders or partners to satisfy such shareholders' or
partners' taxes imposed pursuant to subsections (a) and (b) of
Section 201 of the Illinois Income Tax Act. In no event shall
the amount of the award credited pursuant to this Act exceed
the Illinois income tax liability of the pass-through entity or
its shareholders or partners for the taxable year.
(Source: P.A. 96-834, eff. 12-14-09; 96-836, eff. 12-16-09;
96-905, eff. 6-4-10; 96-1000, eff. 7-2-10; 96-1534, eff.
3-4-11; 97-2, eff. 5-6-11; 97-636, eff. 6-1-12.)
(35 ILCS 10/5-20)
Sec. 5-20. Application for a project to create and retain
new jobs.
(a) Any Taxpayer proposing a project located or planned to
be located in Illinois may request consideration for

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designation of its project, by formal written letter of request
or by formal application to the Department, in which the
Applicant states its intent to make at least a specified level
of investment and intends to hire or retain a specified number
of full-time employees at a designated location in Illinois. As
circumstances require, the Department may require a formal
application from an Applicant and a formal letter of request
for assistance.
(b) In order to qualify for Credits under this Act, an
Applicant's project must:
(1) if the Applicant has more than 100 employees,
involve an investment of at least $2,500,000 $5,000,000 in
capital improvements to be placed in service and to employ
at least 25 New Employees within the State as a direct
result of the project; if the Applicant has 100 or fewer
employees, then there is no capital investment
requirement; and
(1.5) if the Applicant has more than 100 employees,
employ a number of new employees in the State equal to the
lesser of (A) 10% of the number of full-time employees
employed by the applicant world-wide on the date the
application is filed with the Department or (B) 50 New
Employees; and, if the Applicant has 100 or fewer
employees, employ a number of new employees in the State
equal to the lesser of (A) 5% of the number of full-time
employees employed by the applicant world-wide on the date

10000HB0162ham002 - 26 - LRB100 02290 HLH 27733 a
the application is filed with the Department or (B) 50 New
Employees;
(2) (blank); involve an investment of at least an
amount (to be expressly specified by the Department and the
Committee) in capital improvements to be placed in service
and will employ at least an amount (to be expressly
specified by the Department and the Committee) of New
Employees within the State, provided that the Department
and the Committee have determined that the project will
provide a substantial economic benefit to the State; or
(3) (blank). if the applicant has 100 or fewer
employees, involve an investment of at least $1,000,000 in
capital improvements to be placed in service and to employ
at least 5 New Employees within the State as a direct
result of the project.
(c) After receipt of an application, the Department may
enter into an Agreement with the Applicant if the application
is accepted in accordance with Section 5-25.
(Source: P.A. 93-882, eff. 1-1-05.)
(35 ILCS 10/5-25)
Sec. 5-25. Review of Application.
(a) In addition to those duties granted under the Illinois
Economic Development Board Act, the Illinois Economic
Development Board shall form a Business Investment Committee
for the purpose of making recommendations for applications. At

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the request of the Board, the Director of Commerce and Economic
Opportunity or his or her designee, the Director of the
Governor's Office of Management and Budget or his or her
designee, the Director of Revenue or his or her designee, the
Director of Employment Security or his or her designee, and an
elected official of the affected locality, such as the chair of
the county board or the mayor, may serve as members of the
Committee to assist with its analysis and deliberations.
(b) At the Department's request, the Committee shall
convene, make inquiries, and conduct studies in the manner and
by the methods as it deems desirable, review information with
respect to Applicants, and make recommendations for projects to
benefit the State. In making its recommendation that an
Applicant's application for Credit should or should not be
accepted, which shall occur within a reasonable time frame as
determined by the nature of the application, the Committee
shall determine that all the following conditions exist:
(1) The Applicant's project intends, as required by
subsection (b) of Section 5-20 to make the required
investment in the State and intends to hire the required
number of New Employees in Illinois as a result of that
project.
(2) The Applicant's project is economically sound and
will benefit the people of the State of Illinois by
increasing opportunities for employment and strengthen the
economy of Illinois.

10000HB0162ham002 - 28 - LRB100 02290 HLH 27733 a
(3) That, if not for the Credit, the project would not
occur in Illinois, which may be demonstrated by evidence
that receipt of the Credit is essential to the Applicant's
decision to create new jobs in the State, such as the
magnitude of the cost differential between Illinois and a
competing State; in addition, if the Applicant is seeking
an increase in the maximum amount of the Credit for
retained employees, the Applicant must provide any means
including, but not limited to, evidence the Applicant has
multi-state location options and could reasonably and
efficiently locate outside of the State, or demonstrate
demonstration that at least one other state is being
considered for the project, or evidence the receipt of the
Credit is a major factor in the Applicant's decision and
that without the Credit, the Applicant likely would not
create new jobs in Illinois, or demonstration that
receiving the Credit is essential to the Applicant's
decision to create or retain new jobs in the State.
(4) A cost differential is identified, using best
available data, in the projected costs for the Applicant's
project compared to the costs in the competing state,
including the impact of the competing state's incentive
programs. The competing state's incentive programs shall
include state, local, private, and federal funds
available.
(5) The political subdivisions affected by the project

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have committed local incentives with respect to the
project, considering local ability to assist.
(6) Awarding the Credit will result in an overall
positive fiscal impact to the State, as certified by the
Committee using the best available data.
(7) The Credit is not prohibited by Section 5-35 of
this Act.
(Source: P.A. 94-793, eff. 5-19-06.)
(35 ILCS 10/5-50)
Sec. 5-50. Contents of Agreements with Applicants. The
Department shall enter into an Agreement with an Applicant that
is awarded a Credit under this Act. The Agreement must include
all of the following:
(1) A detailed description of the project that is the
subject of the Agreement, including the location and amount
of the investment and jobs created or retained.
(2) The duration of the Credit and the first taxable
year for which the Credit may be claimed.
(3) The Credit amount that will be allowed for each
taxable year.
(4) A requirement that the Taxpayer shall maintain
operations at the project location that shall be stated as
a minimum number of years not to exceed 10.
(5) A specific method for determining the number of New
Employees employed during a taxable year.

10000HB0162ham002 - 30 - LRB100 02290 HLH 27733 a
(6) A requirement that the Taxpayer shall annually
report to the Department the number of New Employees, the
Incremental Income Tax withheld in connection with the New
Employees, and any other information the Director needs to
perform the Director's duties under this Act.
(7) A requirement that the Director is authorized to
verify with the appropriate State agencies the amounts
reported under paragraph (6), and after doing so shall
issue a certificate to the Taxpayer stating that the
amounts have been verified.
(8) A requirement that the Taxpayer shall provide
written notification to the Director not more than 30 days
after the Taxpayer makes or receives a proposal that would
transfer the Taxpayer's State tax liability obligations to
a successor Taxpayer.
(9) A detailed description of the number of New
Employees to be hired, and the occupation and payroll of
the full-time jobs to be created or retained as a result of
the project.
(10) The minimum investment the business enterprise
will make in capital improvements, the time period for
placing the property in service, and the designated
location in Illinois for the investment.
(11) A requirement that the Taxpayer shall provide
written notification to the Director and the Committee not
more than 30 days after the Taxpayer determines that the

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minimum job creation or retention, employment payroll, or
investment no longer is being or will be achieved or
maintained as set forth in the terms and conditions of the
Agreement.
(12) A provision that, if the total number of New
Employees falls below a specified level, the allowance of
Credit shall be suspended until the number of New Employees
equals or exceeds the Agreement amount.
(13) A detailed description of the items for which the
costs incurred by the Taxpayer will be included in the
limitation on the Credit provided in Section 5-30.
(13.5) A provision that, if the Taxpayer never meets
either the investment or job creation and retention
requirements specified in the Agreement during the entire
5-year period beginning on the first day of the first
taxable year in which the Agreement is executed and ending
on the last day of the fifth taxable year after the
Agreement is executed, then the Agreement is automatically
terminated on the last day of the fifth taxable year after
the Agreement is executed and the Taxpayer is not entitled
to the award of any credits for any of that 5-year period.
(13.7) A provision specifying that, if the Taxpayer
ceases principal operations with the intent to shut down
the project in the State permanently, then the Taxpayer
shall be subject to the provisions of the Keep Illinois
Businesses Act, and the recaptured Credit amounts shall be

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reallocated to the local workforce investment area in which
the project was located.
(14) Any other performance conditions or contract
provisions as the Department determines are appropriate.
The Department shall post on its website the terms of each
Agreement entered into under this Act on or after the effective
date of this amendatory Act of the 97th General Assembly. Such
information shall be posted within 10 days after entering into
the Agreement and must include the following:
(1) the name of the recipient business;
(2) the location of the project;
(3) the estimated value of the credit;
(4) the number of new jobs and, if applicable, retained
jobs pledged as a result of the project; and
(5) whether or not the project is located in an
underserved area.
(Source: P.A. 97-2, eff. 5-6-11; 97-749, eff. 7-6-12.)
(35 ILCS 10/5-57 new)
Sec. 5-57. Supplier diversity goals; reports. Each
taxpayer claiming a credit under this Act shall, no later than
April 15 of each taxable year for which the taxpayer claims a
credit under this Act, submit to the Department of Commerce and
Economic Opportunity an annual report containing the
information described in subsections (b), (c), (d), and (e) of
Section 5-117 of the Public Utilities Act. Those reports shall

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be submitted in the form and manner required by the Department
of Commerce and Economic Opportunity.
(35 ILCS 10/5-65)
Sec. 5-65. Noncompliance; notice; assessment. If the
Director determines that a Taxpayer who has received a Credit
under this Act is not complying with the requirements of the
Agreement or all of the provisions of this Act, the Director
shall provide notice to the Taxpayer of the alleged
noncompliance, and allow the Taxpayer a hearing under the
provisions of the Illinois Administrative Procedure Act. If,
after such notice and any hearing, the Director determines that
a noncompliance exists, the Director shall issue to the
Department of Revenue notice to that effect, stating the
Noncompliance Date. If the Taxpayer ceases operations at a
project location that is the subject of an Agreement with the
intent to terminate operations in the State, then the
Department and the Department of Revenue shall recapture the
amount of economic development assistance received under the
Agreement in accordance with the Keep Illinois Businesses Act.
Notwithstanding the provisions of the Keep Illinois Businesses
Act, the Department shall, subject to appropriation,
reallocate the recaptured amounts that are subject to the
Agreement to the local workforce investment area in which the
project was located for the purposes of workforce development,
expanded opportunities for unemployed persons, and expanded

10000HB0162ham002 - 34 - LRB100 02290 HLH 27733 a
opportunities for women and minorities in the workforce.
(Source: P.A. 91-476, eff. 8-11-99.)
(35 ILCS 10/5-70)
Sec. 5-70. Annual report. On or before July 1 each year,
the Committee shall submit a report to the Department on the
tax credit program under this Act to the Governor and the
General Assembly. The report shall include information on the
number of Agreements that were entered into under this Act
during the preceding calendar year, a description of the
project that is the subject of each Agreement, an update on the
status of projects under Agreements entered into before the
preceding calendar year, and the sum of the Credits awarded
under this Act. A copy of the report shall be delivered to the
Governor and to each member of the General Assembly.
The report must include, for each Agreement:
(1) the original estimates of the value of the Credit
and the number of new jobs to be created and, if
applicable, the number of retained jobs;
(2) any relevant modifications to existing Agreements;
(3) a statement of the progress made by each Taxpayer
in meeting the terms of the original Agreement;
(4) a statement of wages paid to New Employees and, if
applicable, retained employees in the State;
(5) any information reported under Section 5-57 of this
Act; and

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(6) a copy of the original Agreement.
(Source: P.A. 91-476, eff. 8-11-99.)
(35 ILCS 10/5-77)
Sec. 5-77. Sunset of new Agreements. The Department shall
not enter into any new Agreements under the provisions of
Section 5-50 of this Act after June 30, 2022 April 30, 2017.
(Source: P.A. 99-925, eff. 1-20-17.)".