Bill Text: IL HB3864 | 2019-2020 | 101st General Assembly | Introduced


Bill Title: Amends the Illinois Enterprise Zone Act. Provides that businesses that intend to establish a new wind power facility and are designated as a high impact businesses on or after the effective date of the amendatory Act are required to enter into construction project labor agreements, including provisions establishing wages, benefits, and other compensation for employees performing work under the project labor agreement at that location. Effective immediately.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2020-02-04 - Assigned to Labor & Commerce Committee [HB3864 Detail]

Download: Illinois-2019-HB3864-Introduced.html


101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
HB3864

Introduced , by Rep. Jay Hoffman

SYNOPSIS AS INTRODUCED:
20 ILCS 655/5.5 from Ch. 67 1/2, par. 609.1

Amends the Illinois Enterprise Zone Act. Provides that businesses that intend to establish a new wind power facility and are designated as a high impact businesses on or after the effective date of the amendatory Act are required to enter into construction project labor agreements, including provisions establishing wages, benefits, and other compensation for employees performing work under the project labor agreement at that location. Effective immediately.
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FISCAL NOTE ACT MAY APPLY

A BILL FOR

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1 AN ACT concerning State government.
2 Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4 Section 5. The Illinois Enterprise Zone Act is amended by
5changing Section 5.5 as follows:
6 (20 ILCS 655/5.5) (from Ch. 67 1/2, par. 609.1)
7 Sec. 5.5. High Impact Business.
8 (a) In order to respond to unique opportunities to assist
9in the encouragement, development, growth and expansion of the
10private sector through large scale investment and development
11projects, the Department is authorized to receive and approve
12applications for the designation of "High Impact Businesses" in
13Illinois subject to the following conditions:
14 (1) such applications may be submitted at any time
15 during the year;
16 (2) such business is not located, at the time of
17 designation, in an enterprise zone designated pursuant to
18 this Act;
19 (3) the business intends to do one or more of the
20 following:
21 (A) the business intends to make a minimum
22 investment of $12,000,000 which will be placed in
23 service in qualified property and intends to create 500

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1 full-time equivalent jobs at a designated location in
2 Illinois or intends to make a minimum investment of
3 $30,000,000 which will be placed in service in
4 qualified property and intends to retain 1,500
5 full-time retained jobs at a designated location in
6 Illinois. The business must certify in writing that the
7 investments would not be placed in service in qualified
8 property and the job creation or job retention would
9 not occur without the tax credits and exemptions set
10 forth in subsection (b) of this Section. The terms
11 "placed in service" and "qualified property" have the
12 same meanings as described in subsection (h) of Section
13 201 of the Illinois Income Tax Act; or
14 (B) the business intends to establish a new
15 electric generating facility at a designated location
16 in Illinois. "New electric generating facility", for
17 purposes of this Section, means a newly-constructed
18 electric generation plant or a newly-constructed
19 generation capacity expansion at an existing electric
20 generation plant, including the transmission lines and
21 associated equipment that transfers electricity from
22 points of supply to points of delivery, and for which
23 such new foundation construction commenced not sooner
24 than July 1, 2001. Such facility shall be designed to
25 provide baseload electric generation and shall operate
26 on a continuous basis throughout the year; and (i)

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1 shall have an aggregate rated generating capacity of at
2 least 1,000 megawatts for all new units at one site if
3 it uses natural gas as its primary fuel and foundation
4 construction of the facility is commenced on or before
5 December 31, 2004, or shall have an aggregate rated
6 generating capacity of at least 400 megawatts for all
7 new units at one site if it uses coal or gases derived
8 from coal as its primary fuel and shall support the
9 creation of at least 150 new Illinois coal mining jobs,
10 or (ii) shall be funded through a federal Department of
11 Energy grant before December 31, 2010 and shall support
12 the creation of Illinois coal-mining jobs, or (iii)
13 shall use coal gasification or integrated
14 gasification-combined cycle units that generate
15 electricity or chemicals, or both, and shall support
16 the creation of Illinois coal-mining jobs. The
17 business must certify in writing that the investments
18 necessary to establish a new electric generating
19 facility would not be placed in service and the job
20 creation in the case of a coal-fueled plant would not
21 occur without the tax credits and exemptions set forth
22 in subsection (b-5) of this Section. The term "placed
23 in service" has the same meaning as described in
24 subsection (h) of Section 201 of the Illinois Income
25 Tax Act; or
26 (B-5) the business intends to establish a new

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1 gasification facility at a designated location in
2 Illinois. As used in this Section, "new gasification
3 facility" means a newly constructed coal gasification
4 facility that generates chemical feedstocks or
5 transportation fuels derived from coal (which may
6 include, but are not limited to, methane, methanol, and
7 nitrogen fertilizer), that supports the creation or
8 retention of Illinois coal-mining jobs, and that
9 qualifies for financial assistance from the Department
10 before December 31, 2010. A new gasification facility
11 does not include a pilot project located within
12 Jefferson County or within a county adjacent to
13 Jefferson County for synthetic natural gas from coal;
14 or
15 (C) the business intends to establish production
16 operations at a new coal mine, re-establish production
17 operations at a closed coal mine, or expand production
18 at an existing coal mine at a designated location in
19 Illinois not sooner than July 1, 2001; provided that
20 the production operations result in the creation of 150
21 new Illinois coal mining jobs as described in
22 subdivision (a)(3)(B) of this Section, and further
23 provided that the coal extracted from such mine is
24 utilized as the predominant source for a new electric
25 generating facility. The business must certify in
26 writing that the investments necessary to establish a

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1 new, expanded, or reopened coal mine would not be
2 placed in service and the job creation would not occur
3 without the tax credits and exemptions set forth in
4 subsection (b-5) of this Section. The term "placed in
5 service" has the same meaning as described in
6 subsection (h) of Section 201 of the Illinois Income
7 Tax Act; or
8 (D) the business intends to construct new
9 transmission facilities or upgrade existing
10 transmission facilities at designated locations in
11 Illinois, for which construction commenced not sooner
12 than July 1, 2001. For the purposes of this Section,
13 "transmission facilities" means transmission lines
14 with a voltage rating of 115 kilovolts or above,
15 including associated equipment, that transfer
16 electricity from points of supply to points of delivery
17 and that transmit a majority of the electricity
18 generated by a new electric generating facility
19 designated as a High Impact Business in accordance with
20 this Section. The business must certify in writing that
21 the investments necessary to construct new
22 transmission facilities or upgrade existing
23 transmission facilities would not be placed in service
24 without the tax credits and exemptions set forth in
25 subsection (b-5) of this Section. The term "placed in
26 service" has the same meaning as described in

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1 subsection (h) of Section 201 of the Illinois Income
2 Tax Act; or
3 (E) the business intends to establish a new wind
4 power facility at a designated location in Illinois; in
5 the case of a business that intends to establish a new
6 wind power facility at a designated location in
7 Illinois and is designated as a high impact business on
8 or after the effective date of this amendatory Act of
9 the 101st General Assembly, the business must also
10 agree to enter into a construction project labor
11 agreement, including provisions establishing wages,
12 benefits, and other compensation for employees
13 performing work under the project labor agreement at
14 that location. For purposes of this Section, "new wind
15 power facility" means a newly constructed electric
16 generation facility, or a newly constructed expansion
17 of an existing electric generation facility, placed in
18 service on or after July 1, 2009, that generates
19 electricity using wind energy devices, and such
20 facility shall be deemed to include all associated
21 transmission lines, substations, and other equipment
22 related to the generation of electricity from wind
23 energy devices. For purposes of this Section, "wind
24 energy device" means any device, with a nameplate
25 capacity of at least 0.5 megawatts, that is used in the
26 process of converting kinetic energy from the wind to

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1 generate electricity; or
2 (F) the business commits to (i) make a minimum
3 investment of $500,000,000, which will be placed in
4 service in a qualified property, (ii) create 125
5 full-time equivalent jobs at a designated location in
6 Illinois, (iii) establish a fertilizer plant at a
7 designated location in Illinois that complies with the
8 set-back standards as described in Table 1: Initial
9 Isolation and Protective Action Distances in the 2012
10 Emergency Response Guidebook published by the United
11 States Department of Transportation, (iv) pay a
12 prevailing wage for employees at that location who are
13 engaged in construction activities, and (v) secure an
14 appropriate level of general liability insurance to
15 protect against catastrophic failure of the fertilizer
16 plant or any of its constituent systems; in addition,
17 the business must agree to enter into a construction
18 project labor agreement including provisions
19 establishing wages, benefits, and other compensation
20 for employees performing work under the project labor
21 agreement at that location; for the purposes of this
22 Section, "fertilizer plant" means a newly constructed
23 or upgraded plant utilizing gas used in the production
24 of anhydrous ammonia and downstream nitrogen
25 fertilizer products for resale; for the purposes of
26 this Section, "prevailing wage" means the hourly cash

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1 wages plus fringe benefits for training and
2 apprenticeship programs approved by the U.S.
3 Department of Labor, Bureau of Apprenticeship and
4 Training, health and welfare, insurance, vacations and
5 pensions paid generally, in the locality in which the
6 work is being performed, to employees engaged in work
7 of a similar character on public works; this paragraph
8 (F) applies only to businesses that submit an
9 application to the Department within 60 days after the
10 effective date of this amendatory Act of the 98th
11 General Assembly; and
12 (4) no later than 90 days after an application is
13 submitted, the Department shall notify the applicant of the
14 Department's determination of the qualification of the
15 proposed High Impact Business under this Section.
16 (b) Businesses designated as High Impact Businesses
17pursuant to subdivision (a)(3)(A) of this Section shall qualify
18for the credits and exemptions described in the following Acts:
19Section 9-222 and Section 9-222.1A of the Public Utilities Act,
20subsection (h) of Section 201 of the Illinois Income Tax Act,
21and Section 1d of the Retailers' Occupation Tax Act; provided
22that these credits and exemptions described in these Acts shall
23not be authorized until the minimum investments set forth in
24subdivision (a)(3)(A) of this Section have been placed in
25service in qualified properties and, in the case of the
26exemptions described in the Public Utilities Act and Section 1d

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1of the Retailers' Occupation Tax Act, the minimum full-time
2equivalent jobs or full-time retained jobs set forth in
3subdivision (a)(3)(A) of this Section have been created or
4retained. Businesses designated as High Impact Businesses
5under this Section shall also qualify for the exemption
6described in Section 5l of the Retailers' Occupation Tax Act.
7The credit provided in subsection (h) of Section 201 of the
8Illinois Income Tax Act shall be applicable to investments in
9qualified property as set forth in subdivision (a)(3)(A) of
10this Section.
11 (b-5) Businesses designated as High Impact Businesses
12pursuant to subdivisions (a)(3)(B), (a)(3)(B-5), (a)(3)(C),
13and (a)(3)(D) of this Section shall qualify for the credits and
14exemptions described in the following Acts: Section 51 of the
15Retailers' Occupation Tax Act, Section 9-222 and Section
169-222.1A of the Public Utilities Act, and subsection (h) of
17Section 201 of the Illinois Income Tax Act; however, the
18credits and exemptions authorized under Section 9-222 and
19Section 9-222.1A of the Public Utilities Act, and subsection
20(h) of Section 201 of the Illinois Income Tax Act shall not be
21authorized until the new electric generating facility, the new
22gasification facility, the new transmission facility, or the
23new, expanded, or reopened coal mine is operational, except
24that a new electric generating facility whose primary fuel
25source is natural gas is eligible only for the exemption under
26Section 5l of the Retailers' Occupation Tax Act.

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1 (b-6) Businesses designated as High Impact Businesses
2pursuant to subdivision (a)(3)(E) of this Section shall qualify
3for the exemptions described in Section 5l of the Retailers'
4Occupation Tax Act; any business so designated as a High Impact
5Business being, for purposes of this Section, a "Wind Energy
6Business".
7 (b-7) Beginning on January 1, 2021, businesses designated
8as High Impact Businesses by the Department shall qualify for
9the High Impact Business construction jobs credit under
10subsection (h-5) of Section 201 of the Illinois Income Tax Act
11if the business meets the criteria set forth in subsection (i)
12of this Section. The total aggregate amount of credits awarded
13under the Blue Collar Jobs Act (Article 20 of this amendatory
14Act of the 101st General Assembly) shall not exceed $20,000,000
15in any State fiscal year.
16 (c) High Impact Businesses located in federally designated
17foreign trade zones or sub-zones are also eligible for
18additional credits, exemptions and deductions as described in
19the following Acts: Section 9-221 and Section 9-222.1 of the
20Public Utilities Act; and subsection (g) of Section 201, and
21Section 203 of the Illinois Income Tax Act.
22 (d) Except for businesses contemplated under subdivision
23(a)(3)(E) of this Section, existing Illinois businesses which
24apply for designation as a High Impact Business must provide
25the Department with the prospective plan for which 1,500
26full-time retained jobs would be eliminated in the event that

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1the business is not designated.
2 (e) Except for new wind power facilities contemplated under
3subdivision (a)(3)(E) of this Section, new proposed facilities
4which apply for designation as High Impact Business must
5provide the Department with proof of alternative non-Illinois
6sites which would receive the proposed investment and job
7creation in the event that the business is not designated as a
8High Impact Business.
9 (f) Except for businesses contemplated under subdivision
10(a)(3)(E) of this Section, in the event that a business is
11designated a High Impact Business and it is later determined
12after reasonable notice and an opportunity for a hearing as
13provided under the Illinois Administrative Procedure Act, that
14the business would have placed in service in qualified property
15the investments and created or retained the requisite number of
16jobs without the benefits of the High Impact Business
17designation, the Department shall be required to immediately
18revoke the designation and notify the Director of the
19Department of Revenue who shall begin proceedings to recover
20all wrongfully exempted State taxes with interest. The business
21shall also be ineligible for all State funded Department
22programs for a period of 10 years.
23 (g) The Department shall revoke a High Impact Business
24designation if the participating business fails to comply with
25the terms and conditions of the designation. However, the
26penalties for new wind power facilities or Wind Energy

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1Businesses for failure to comply with any of the terms or
2conditions of the Illinois Prevailing Wage Act shall be only
3those penalties identified in the Illinois Prevailing Wage Act,
4and the Department shall not revoke a High Impact Business
5designation as a result of the failure to comply with any of
6the terms or conditions of the Illinois Prevailing Wage Act in
7relation to a new wind power facility or a Wind Energy
8Business.
9 (h) Prior to designating a business, the Department shall
10provide the members of the General Assembly and Commission on
11Government Forecasting and Accountability with a report
12setting forth the terms and conditions of the designation and
13guarantees that have been received by the Department in
14relation to the proposed business being designated.
15 (i) High Impact Business construction jobs credit.
16Beginning on January 1, 2021, a High Impact Business may
17receive a tax credit against the tax imposed under subsections
18(a) and (b) of Section 201 of the Illinois Income Tax Act in an
19amount equal to 50% of the amount of the incremental income tax
20attributable to High Impact Business construction jobs credit
21employees employed in the course of completing a High Impact
22Business construction jobs project. However, the High Impact
23Business construction jobs credit may equal 75% of the amount
24of the incremental income tax attributable to High Impact
25Business construction jobs credit employees if the High Impact
26Business construction jobs credit project is located in an

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1underserved area.
2 The Department shall certify to the Department of Revenue:
3(1) the identity of taxpayers that are eligible for the High
4Impact Business construction jobs credit; and (2) the amount of
5High Impact Business construction jobs credits that are claimed
6pursuant to subsection (h-5) of Section 201 of the Illinois
7Income Tax Act in each taxable year. Any business entity that
8receives a High Impact Business construction jobs credit shall
9maintain a certified payroll pursuant to subsection (j) of this
10Section.
11 As used in this subsection (i):
12 "High Impact Business construction jobs credit" means an
13amount equal to 50% (or 75% if the High Impact Business
14construction project is located in an underserved area) of the
15incremental income tax attributable to High Impact Business
16construction job employees. The total aggregate amount of
17credits awarded under the Blue Collar Jobs Act (Article 20 of
18this amendatory Act of the 101st General Assembly) shall not
19exceed $20,000,000 in any State fiscal year
20 "High Impact Business construction job employee" means a
21laborer or worker who is employed by an Illinois contractor or
22subcontractor in the actual construction work on the site of a
23High Impact Business construction job project.
24 "High Impact Business construction jobs project" means
25building a structure or building or making improvements of any
26kind to real property, undertaken and commissioned by a

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1business that was designated as a High Impact Business by the
2Department. The term "High Impact Business construction jobs
3project" does not include the routine operation, routine
4repair, or routine maintenance of existing structures,
5buildings, or real property.
6 "Incremental income tax" means the total amount withheld
7during the taxable year from the compensation of High Impact
8Business construction job employees.
9 "Underserved area" means a geographic area that meets one
10or more of the following conditions:
11 (1) the area has a poverty rate of at least 20%
12 according to the latest federal decennial census;
13 (2) 75% or more of the children in the area participate
14 in the federal free lunch program according to reported
15 statistics from the State Board of Education;
16 (3) at least 20% of the households in the area receive
17 assistance under the Supplemental Nutrition Assistance
18 Program (SNAP); or
19 (4) the area has an average unemployment rate, as
20 determined by the Illinois Department of Employment
21 Security, that is more than 120% of the national
22 unemployment average, as determined by the U.S. Department
23 of Labor, for a period of at least 2 consecutive calendar
24 years preceding the date of the application.
25 (j) Each contractor and subcontractor who is engaged in and
26executing a High Impact Business Construction jobs project, as

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1defined under subsection (i) of this Section, for a business
2that is entitled to a credit pursuant to subsection (i) of this
3Section shall:
4 (1) make and keep, for a period of 5 years from the
5 date of the last payment made on or after the effective
6 date of this amendatory Act of the 101st General Assembly
7 on a contract or subcontract for a High Impact Business
8 Construction Jobs Project, records for all laborers and
9 other workers employed by the contractor or subcontractor
10 on the project; the records shall include:
11 (A) the worker's name;
12 (B) the worker's address;
13 (C) the worker's telephone number, if available;
14 (D) the worker's social security number;
15 (E) the worker's classification or
16 classifications;
17 (F) the worker's gross and net wages paid in each
18 pay period;
19 (G) the worker's number of hours worked each day;
20 (H) the worker's starting and ending times of work
21 each day;
22 (I) the worker's hourly wage rate; and
23 (J) the worker's hourly overtime wage rate;
24 (2) no later than the 15th day of each calendar month,
25 provide a certified payroll for the immediately preceding
26 month to the taxpayer in charge of the High Impact Business

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1 construction jobs project; within 5 business days after
2 receiving the certified payroll, the taxpayer shall file
3 the certified payroll with the Department of Labor and the
4 Department of Commerce and Economic Opportunity; a
5 certified payroll must be filed for only those calendar
6 months during which construction on a High Impact Business
7 construction jobs project has occurred; the certified
8 payroll shall consist of a complete copy of the records
9 identified in paragraph (1) of this subsection (j), but may
10 exclude the starting and ending times of work each day; the
11 certified payroll shall be accompanied by a statement
12 signed by the contractor or subcontractor or an officer,
13 employee, or agent of the contractor or subcontractor which
14 avers that:
15 (A) he or she has examined the certified payroll
16 records required to be submitted by the Act and such
17 records are true and accurate; and
18 (B) the contractor or subcontractor is aware that
19 filing a certified payroll that he or she knows to be
20 false is a Class A misdemeanor.
21 A general contractor is not prohibited from relying on a
22certified payroll of a lower-tier subcontractor, provided the
23general contractor does not knowingly rely upon a
24subcontractor's false certification.
25 Any contractor or subcontractor subject to this
26subsection, and any officer, employee, or agent of such

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1contractor or subcontractor whose duty as an officer, employee,
2or agent it is to file a certified payroll under this
3subsection, who willfully fails to file such a certified
4payroll on or before the date such certified payroll is
5required by this paragraph to be filed and any person who
6willfully files a false certified payroll that is false as to
7any material fact is in violation of this Act and guilty of a
8Class A misdemeanor.
9 The taxpayer in charge of the project shall keep the
10records submitted in accordance with this subsection on or
11after the effective date of this amendatory Act of the 101st
12General Assembly for a period of 5 years from the date of the
13last payment for work on a contract or subcontract for the High
14Impact Business construction jobs project.
15 The records submitted in accordance with this subsection
16shall be considered public records, except an employee's
17address, telephone number, and social security number, and made
18available in accordance with the Freedom of Information Act.
19The Department of Labor shall accept any reasonable submissions
20by the contractor that meet the requirements of this subsection
21(j) and shall share the information with the Department in
22order to comply with the awarding of a High Impact Business
23construction jobs credit. A contractor, subcontractor, or
24public body may retain records required under this Section in
25paper or electronic format.
26 (k) Upon 7 business days' notice, each contractor and

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1subcontractor shall make available for inspection and copying
2at a location within this State during reasonable hours, the
3records identified in this subsection (j) to the taxpayer in
4charge of the High Impact Business construction jobs project,
5its officers and agents, the Director of the Department of
6Labor and his deputies and agents, and to federal, State, or
7local law enforcement agencies and prosecutors.
8(Source: P.A. 101-9, eff. 6-5-19.)
9 Section 99. Effective date. This Act takes effect upon
10becoming law.
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