Bill Text: IL HB3456 | 2015-2016 | 99th General Assembly | Introduced

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Bill Title: Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that, beginning on July 1, 2015 and through June 30, 2025, certain tangible personal property to be used in the construction or operation of a data center is exempt from taxation under the Acts. Provides that the data center must sign an agreement with the Department of Commerce and Economic Opportunity containing the following elements: (1) the data center, including its colocation tenants, must create and maintain at least 30 full-time equivalent jobs; (2) those jobs must pay at least 125% of the median wage paid to full-time employees in the county where the data center is located, as determined by the U.S. Bureau of Labor Statistics; and (3) at least $25,000,000 in capital must be invested in the data center. Effective July 1, 2015.

Sponsorship: Slight Partisan Bill (Republican 2-1)

Status: (Introduced - Dead) 2015-04-20 - Added Co-Sponsor Rep. Brian W. Stewart [HB3456 Detail]

Download: Illinois-2015-HB3456-Introduced.html

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99TH GENERAL ASSEMBLY State of Illinois 2015 and 2016 HB3456 Introduced , by Rep. Charles E. Meier SYNOPSIS AS INTRODUCED:
35 ILCS 105/3-9 new
35 ILCS 110/3-9 new
35 ILCS 115/3-9 new
35 ILCS 120/1t new
Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that, beginning on July 1, 2015 and through June 30, 2025, certain tangible personal property to be used in the construction or operation of a data center is exempt from taxation under the Acts. Provides that the data center must sign an agreement with the Department of Commerce and Economic Opportunity containing the following elements: (1) the data center, including its colocation tenants, must create and maintain at least 30 full-time equivalent jobs; (2) those jobs must pay at least 125% of the median wage paid to full-time employees in the county where the data center is located, as determined by the U.S. Bureau of Labor Statistics; and (3) at least $25,000,000 in capital must be invested in the data center. Effective July 1, 2015.
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FISCAL NOTE ACT MAY APPLY HOUSING AFFORDABILITY IMPACT NOTE ACT MAY APPLY
A BILL FOR
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AN ACT concerning revenue.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Use Tax Act is amended by adding Section 3-9
as follows:
(35 ILCS 105/3-9 new)
Sec. 3-9. Data center exemption.
(a) Beginning on July 1, 2015 and through June 30, 2025,
qualified tangible personal property to be used in the
construction or operation of a data center is exempt from
taxation under this Act if: (i) the data center signs an
agreement with the Department of Commerce and Economic
Opportunity, and (ii) the agreement contains the following
elements:
(1) the data center, including its qualified
colocation tenants, must create and maintain at least 30
full-time equivalent jobs;
(2) those jobs must pay at least 125% of the median
wage paid to full-time employees in the county where the
data center is located, as determined by the U.S. Bureau of
Labor Statistics; and
(3) at least $25,000,000 in capital must be invested in
the data center.

HB3456 - 2 - LRB099 05584 HLH 25621 b
(b) As used in this Section:
"Data center" means a building rehabilitated or
constructed to house a group of networked server computers
in one physical location in order to centralize the
storage, management, and dissemination of data and
information pertaining to a particular business, taxonomy,
or body of knowledge.
"Full-time equivalent job" means a job in which the
employee works for the taxpayer or for a corporation under
contract with the taxpayer at a rate of at least 35 hours
per week. A taxpayer who employs labor or services at a
specific site or facility under contract with another may
declare one full-time equivalent job for every 1,820 man
hours worked per year under that contract. Vacations, paid
holidays, and sick time are included in this computation.
Overtime is not considered a part of regular hours.
"Qualified colocation tenant" means an entity that
contracts with the owner or operator of a computer data
center described in subsection (a) of this Section to use
or occupy all or part of the computer data center for at
least 500 kilowatts per month for a period of 2 or more
years.
"Qualified tangible personal property" means an
electrical system; a cooling system; an emergency
generator; hardware or a distributed mainframe computer or
server; a data storage device; network connectivity

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equipment; a rack, cabinet, and raised floor system; a
peripheral component or system; software; a mechanical,
electrical, or plumbing system necessary to operate the
foregoing property; any other item of equipment or system
necessary to operate any of the foregoing, including a
fixture; and a component part of any of the foregoing.
(c) This Section is repealed on July 1, 2025.
Section 10. The Service Use Tax Act is amended by adding
Section 3-9 as follows:
(35 ILCS 110/3-9 new)
Sec. 3-9. Data center exemption.
(a) Beginning on July 1, 2015 and through June 30, 2025,
qualified tangible personal property to be used in the
construction or operation of a data center is exempt from
taxation under this Act if: (i) the data center signs an
agreement with the Department of Commerce and Economic
Opportunity, and (ii) the agreement contains the following
elements:
(1) the data center, including its qualified
colocation tenants, must create and maintain at least 30
full-time equivalent jobs;
(2) those jobs must pay at least 125% of the median
wage paid to full-time employees in the county where the
data center is located, as determined by the U.S. Bureau of

HB3456 - 4 - LRB099 05584 HLH 25621 b
Labor Statistics; and
(3) at least $25,000,000 in capital must be invested in
the data center.
(b) As used in this Section:
"Data center" means a building rehabilitated or
constructed to house a group of networked server computers
in one physical location in order to centralize the
storage, management, and dissemination of data and
information pertaining to a particular business, taxonomy,
or body of knowledge.
"Full-time equivalent job" means a job in which the
employee works for the taxpayer or for a corporation under
contract with the taxpayer at a rate of at least 35 hours
per week. A taxpayer who employs labor or services at a
specific site or facility under contract with another may
declare one full-time equivalent job for every 1,820 man
hours worked per year under that contract. Vacations, paid
holidays, and sick time are included in this computation.
Overtime is not considered a part of regular hours.
"Qualified colocation tenant" means an entity that
contracts with the owner or operator of a computer data
center described in subsection (a) of this Section to use
or occupy all or part of the computer data center for at
least 500 kilowatts per month for a period of 2 or more
years.
"Qualified tangible personal property" means an

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electrical system; a cooling system; an emergency
generator; hardware or a distributed mainframe computer or
server; a data storage device; network connectivity
equipment; a rack, cabinet, and raised floor system; a
peripheral component or system; software; a mechanical,
electrical, or plumbing system necessary to operate the
foregoing property; any other item of equipment or system
necessary to operate any of the foregoing, including a
fixture; and a component part of any of the foregoing.
(c) This Section is repealed on July 1, 2025.
Section 15. The Service Occupation Tax Act is amended by
adding Section 3-9 as follows:
(35 ILCS 115/3-9 new)
Sec. 3-9. Data center exemption.
(a) Beginning on July 1, 2015 and through June 30, 2025,
qualified tangible personal property to be used in the
construction or operation of a data center is exempt from
taxation under this Act if: (i) the data center signs an
agreement with the Department of Commerce and Economic
Opportunity, and (ii) the agreement contains the following
elements:
(1) the data center, including its qualified
colocation tenants, must create and maintain at least 30
full-time equivalent jobs;

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(2) those jobs must pay at least 125% of the median
wage paid to full-time employees in the county where the
data center is located, as determined by the U.S. Bureau of
Labor Statistics; and
(3) at least $25,000,000 in capital must be invested in
the data center.
(b) As used in this Section:
"Data center" means a building rehabilitated or
constructed to house a group of networked server computers
in one physical location in order to centralize the
storage, management, and dissemination of data and
information pertaining to a particular business, taxonomy,
or body of knowledge.
"Full-time equivalent job" means a job in which the
employee works for the taxpayer or for a corporation under
contract with the taxpayer at a rate of at least 35 hours
per week. A taxpayer who employs labor or services at a
specific site or facility under contract with another may
declare one full-time equivalent job for every 1,820 man
hours worked per year under that contract. Vacations, paid
holidays, and sick time are included in this computation.
Overtime is not considered a part of regular hours.
"Qualified colocation tenant" means an entity that
contracts with the owner or operator of a computer data
center described in subsection (a) of this Section to use
or occupy all or part of the computer data center for at

HB3456 - 7 - LRB099 05584 HLH 25621 b
least 500 kilowatts per month for a period of 2 or more
years.
"Qualified tangible personal property" means an
electrical system; a cooling system; an emergency
generator; hardware or a distributed mainframe computer or
server; a data storage device; network connectivity
equipment; a rack, cabinet, and raised floor system; a
peripheral component or system; software; a mechanical,
electrical, or plumbing system necessary to operate the
foregoing property; any other item of equipment or system
necessary to operate any of the foregoing, including a
fixture; and a component part of any of the foregoing.
(c) This Section is repealed on July 1, 2025.
Section 20. The Retailers' Occupation Tax Act is amended by
adding Section 1t as follows:
(35 ILCS 120/1t new)
Sec. 1t. Data center exemption.
(a) Beginning on July 1, 2015 and through June 30, 2025,
qualified tangible personal property to be used in the
construction or operation of a data center is exempt from
taxation under this Act if: (i) the data center signs an
agreement with the Department of Commerce and Economic
Opportunity, and (ii) the agreement contains the following
elements:

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(1) the data center, including its qualified
colocation tenants, must create and maintain at least 30
full-time equivalent jobs;
(2) those jobs must pay at least 125% of the median
wage paid to full-time employees in the county where the
data center is located, as determined by the U.S. Bureau of
Labor Statistics; and
(3) at least $25,000,000 in capital must be invested in
the data center.
(b) As used in this Section:
"Data center" means a building rehabilitated or
constructed to house a group of networked server computers
in one physical location in order to centralize the
storage, management, and dissemination of data and
information pertaining to a particular business, taxonomy,
or body of knowledge.
"Full-time equivalent job" means a job in which the
employee works for the taxpayer or for a corporation under
contract with the taxpayer at a rate of at least 35 hours
per week. A taxpayer who employs labor or services at a
specific site or facility under contract with another may
declare one full-time equivalent job for every 1,820 man
hours worked per year under that contract. Vacations, paid
holidays, and sick time are included in this computation.
Overtime is not considered a part of regular hours.
"Qualified colocation tenant" means an entity that

HB3456 - 9 - LRB099 05584 HLH 25621 b
contracts with the owner or operator of a computer data
center described in subsection (a) of this Section to use
or occupy all or part of the computer data center for at
least 500 kilowatts per month for a period of 2 or more
years.
"Qualified tangible personal property" means an
electrical system; a cooling system; an emergency
generator; hardware or a distributed mainframe computer or
server; a data storage device; network connectivity
equipment; a rack, cabinet, and raised floor system; a
peripheral component or system; software; a mechanical,
electrical, or plumbing system necessary to operate the
foregoing property; any other item of equipment or system
necessary to operate any of the foregoing, including a
fixture; and a component part of any of the foregoing.
(c) This Section is repealed on July 1, 2025.
Section 99. Effective date. This Act takes effect July 1,
2015.