Bill Text: IL HB3865 | 2019-2020 | 101st General Assembly | Introduced


Bill Title: Amends the Illinois Enterprise Zone Act. With respect to new wind power facilities and Wind Energy Businesses, repeals language providing that (i) the penalties for failure to comply with the Prevailing Wage Act are limited to the penalties identified in the Prevailing Wage Act and (ii) the Department of Commerce and Economic Opportunity may not revoke a High Impact Business designation as a result of the failure to comply with the Prevailing Wage Act. Effective immediately.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2020-03-05 - Placed on Calendar 2nd Reading - Short Debate [HB3865 Detail]

Download: Illinois-2019-HB3865-Introduced.html


101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
HB3865

Introduced , by Rep. Lawrence Walsh, Jr.

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

Amends the Illinois Enterprise Zone Act. With respect to new wind power facilities and Wind Energy Businesses, repeals language providing that (i) the penalties for failure to comply with the Prevailing Wage Act are limited to the penalties identified in the Prevailing Wage Act and (ii) the Department of Commerce and Economic Opportunity may not revoke a High Impact Business designation as a result of the failure to comply with the Prevailing Wage Act. 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.
5 For purposes of this Section, "new wind power facility"
6 means a newly constructed electric generation
7 facility, or a newly constructed expansion of an
8 existing electric generation facility, placed in
9 service on or after July 1, 2009, that generates
10 electricity using wind energy devices, and such
11 facility shall be deemed to include all associated
12 transmission lines, substations, and other equipment
13 related to the generation of electricity from wind
14 energy devices. For purposes of this Section, "wind
15 energy device" means any device, with a nameplate
16 capacity of at least 0.5 megawatts, that is used in the
17 process of converting kinetic energy from the wind to
18 generate electricity; or
19 (F) the business commits to (i) make a minimum
20 investment of $500,000,000, which will be placed in
21 service in a qualified property, (ii) create 125
22 full-time equivalent jobs at a designated location in
23 Illinois, (iii) establish a fertilizer plant at a
24 designated location in Illinois that complies with the
25 set-back standards as described in Table 1: Initial
26 Isolation and Protective Action Distances in the 2012

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1 Emergency Response Guidebook published by the United
2 States Department of Transportation, (iv) pay a
3 prevailing wage for employees at that location who are
4 engaged in construction activities, and (v) secure an
5 appropriate level of general liability insurance to
6 protect against catastrophic failure of the fertilizer
7 plant or any of its constituent systems; in addition,
8 the business must agree to enter into a construction
9 project labor agreement including provisions
10 establishing wages, benefits, and other compensation
11 for employees performing work under the project labor
12 agreement at that location; for the purposes of this
13 Section, "fertilizer plant" means a newly constructed
14 or upgraded plant utilizing gas used in the production
15 of anhydrous ammonia and downstream nitrogen
16 fertilizer products for resale; for the purposes of
17 this Section, "prevailing wage" means the hourly cash
18 wages plus fringe benefits for training and
19 apprenticeship programs approved by the U.S.
20 Department of Labor, Bureau of Apprenticeship and
21 Training, health and welfare, insurance, vacations and
22 pensions paid generally, in the locality in which the
23 work is being performed, to employees engaged in work
24 of a similar character on public works; this paragraph
25 (F) applies only to businesses that submit an
26 application to the Department within 60 days after the

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1 effective date of this amendatory Act of the 98th
2 General Assembly; and
3 (4) no later than 90 days after an application is
4 submitted, the Department shall notify the applicant of the
5 Department's determination of the qualification of the
6 proposed High Impact Business under this Section.
7 (b) Businesses designated as High Impact Businesses
8pursuant to subdivision (a)(3)(A) of this Section shall qualify
9for the credits and exemptions described in the following Acts:
10Section 9-222 and Section 9-222.1A of the Public Utilities Act,
11subsection (h) of Section 201 of the Illinois Income Tax Act,
12and Section 1d of the Retailers' Occupation Tax Act; provided
13that these credits and exemptions described in these Acts shall
14not be authorized until the minimum investments set forth in
15subdivision (a)(3)(A) of this Section have been placed in
16service in qualified properties and, in the case of the
17exemptions described in the Public Utilities Act and Section 1d
18of the Retailers' Occupation Tax Act, the minimum full-time
19equivalent jobs or full-time retained jobs set forth in
20subdivision (a)(3)(A) of this Section have been created or
21retained. Businesses designated as High Impact Businesses
22under this Section shall also qualify for the exemption
23described in Section 5l of the Retailers' Occupation Tax Act.
24The credit provided in subsection (h) of Section 201 of the
25Illinois Income Tax Act shall be applicable to investments in
26qualified property as set forth in subdivision (a)(3)(A) of

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1this Section.
2 (b-5) Businesses designated as High Impact Businesses
3pursuant to subdivisions (a)(3)(B), (a)(3)(B-5), (a)(3)(C),
4and (a)(3)(D) of this Section shall qualify for the credits and
5exemptions described in the following Acts: Section 51 of the
6Retailers' Occupation Tax Act, Section 9-222 and Section
79-222.1A of the Public Utilities Act, and subsection (h) of
8Section 201 of the Illinois Income Tax Act; however, the
9credits and exemptions authorized under Section 9-222 and
10Section 9-222.1A of the Public Utilities Act, and subsection
11(h) of Section 201 of the Illinois Income Tax Act shall not be
12authorized until the new electric generating facility, the new
13gasification facility, the new transmission facility, or the
14new, expanded, or reopened coal mine is operational, except
15that a new electric generating facility whose primary fuel
16source is natural gas is eligible only for the exemption under
17Section 5l of the Retailers' Occupation Tax Act.
18 (b-6) Businesses designated as High Impact Businesses
19pursuant to subdivision (a)(3)(E) of this Section shall qualify
20for the exemptions described in Section 5l of the Retailers'
21Occupation Tax Act; any business so designated as a High Impact
22Business being, for purposes of this Section, a "Wind Energy
23Business".
24 (b-7) Beginning on January 1, 2021, businesses designated
25as High Impact Businesses by the Department shall qualify for
26the High Impact Business construction jobs credit under

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1subsection (h-5) of Section 201 of the Illinois Income Tax Act
2if the business meets the criteria set forth in subsection (i)
3of this Section. The total aggregate amount of credits awarded
4under the Blue Collar Jobs Act (Article 20 of this amendatory
5Act of the 101st General Assembly) shall not exceed $20,000,000
6in any State fiscal year.
7 (c) High Impact Businesses located in federally designated
8foreign trade zones or sub-zones are also eligible for
9additional credits, exemptions and deductions as described in
10the following Acts: Section 9-221 and Section 9-222.1 of the
11Public Utilities Act; and subsection (g) of Section 201, and
12Section 203 of the Illinois Income Tax Act.
13 (d) Except for businesses contemplated under subdivision
14(a)(3)(E) of this Section, existing Illinois businesses which
15apply for designation as a High Impact Business must provide
16the Department with the prospective plan for which 1,500
17full-time retained jobs would be eliminated in the event that
18the business is not designated.
19 (e) Except for new wind power facilities contemplated under
20subdivision (a)(3)(E) of this Section, new proposed facilities
21which apply for designation as High Impact Business must
22provide the Department with proof of alternative non-Illinois
23sites which would receive the proposed investment and job
24creation in the event that the business is not designated as a
25High Impact Business.
26 (f) Except for businesses contemplated under subdivision

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1(a)(3)(E) of this Section, in the event that a business is
2designated a High Impact Business and it is later determined
3after reasonable notice and an opportunity for a hearing as
4provided under the Illinois Administrative Procedure Act, that
5the business would have placed in service in qualified property
6the investments and created or retained the requisite number of
7jobs without the benefits of the High Impact Business
8designation, the Department shall be required to immediately
9revoke the designation and notify the Director of the
10Department of Revenue who shall begin proceedings to recover
11all wrongfully exempted State taxes with interest. The business
12shall also be ineligible for all State funded Department
13programs for a period of 10 years.
14 (g) The Department shall revoke a High Impact Business
15designation if the participating business fails to comply with
16the terms and conditions of the designation. However, the
17penalties for new wind power facilities or Wind Energy
18Businesses for failure to comply with any of the terms or
19conditions of the Illinois Prevailing Wage Act shall be only
20those penalties identified in the Illinois Prevailing Wage Act,
21and the Department shall not revoke a High Impact Business
22designation as a result of the failure to comply with any of
23the terms or conditions of the Illinois Prevailing Wage Act in
24relation to a new wind power facility or a Wind Energy
25Business.
26 (h) Prior to designating a business, the Department shall

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1provide the members of the General Assembly and Commission on
2Government Forecasting and Accountability with a report
3setting forth the terms and conditions of the designation and
4guarantees that have been received by the Department in
5relation to the proposed business being designated.
6 (i) High Impact Business construction jobs credit.
7Beginning on January 1, 2021, a High Impact Business may
8receive a tax credit against the tax imposed under subsections
9(a) and (b) of Section 201 of the Illinois Income Tax Act in an
10amount equal to 50% of the amount of the incremental income tax
11attributable to High Impact Business construction jobs credit
12employees employed in the course of completing a High Impact
13Business construction jobs project. However, the High Impact
14Business construction jobs credit may equal 75% of the amount
15of the incremental income tax attributable to High Impact
16Business construction jobs credit employees if the High Impact
17Business construction jobs credit project is located in an
18underserved area.
19 The Department shall certify to the Department of Revenue:
20(1) the identity of taxpayers that are eligible for the High
21Impact Business construction jobs credit; and (2) the amount of
22High Impact Business construction jobs credits that are claimed
23pursuant to subsection (h-5) of Section 201 of the Illinois
24Income Tax Act in each taxable year. Any business entity that
25receives a High Impact Business construction jobs credit shall
26maintain a certified payroll pursuant to subsection (j) of this

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1Section.
2 As used in this subsection (i):
3 "High Impact Business construction jobs credit" means an
4amount equal to 50% (or 75% if the High Impact Business
5construction project is located in an underserved area) of the
6incremental income tax attributable to High Impact Business
7construction job employees. The total aggregate amount of
8credits awarded under the Blue Collar Jobs Act (Article 20 of
9this amendatory Act of the 101st General Assembly) shall not
10exceed $20,000,000 in any State fiscal year
11 "High Impact Business construction job employee" means a
12laborer or worker who is employed by an Illinois contractor or
13subcontractor in the actual construction work on the site of a
14High Impact Business construction job project.
15 "High Impact Business construction jobs project" means
16building a structure or building or making improvements of any
17kind to real property, undertaken and commissioned by a
18business that was designated as a High Impact Business by the
19Department. The term "High Impact Business construction jobs
20project" does not include the routine operation, routine
21repair, or routine maintenance of existing structures,
22buildings, or real property.
23 "Incremental income tax" means the total amount withheld
24during the taxable year from the compensation of High Impact
25Business construction job employees.
26 "Underserved area" means a geographic area that meets one

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1or more of the following conditions:
2 (1) the area has a poverty rate of at least 20%
3 according to the latest federal decennial census;
4 (2) 75% or more of the children in the area participate
5 in the federal free lunch program according to reported
6 statistics from the State Board of Education;
7 (3) at least 20% of the households in the area receive
8 assistance under the Supplemental Nutrition Assistance
9 Program (SNAP); or
10 (4) the area has an average unemployment rate, as
11 determined by the Illinois Department of Employment
12 Security, that is more than 120% of the national
13 unemployment average, as determined by the U.S. Department
14 of Labor, for a period of at least 2 consecutive calendar
15 years preceding the date of the application.
16 (j) Each contractor and subcontractor who is engaged in and
17executing a High Impact Business Construction jobs project, as
18defined under subsection (i) of this Section, for a business
19that is entitled to a credit pursuant to subsection (i) of this
20Section shall:
21 (1) make and keep, for a period of 5 years from the
22 date of the last payment made on or after the effective
23 date of this amendatory Act of the 101st General Assembly
24 on a contract or subcontract for a High Impact Business
25 Construction Jobs Project, records for all laborers and
26 other workers employed by the contractor or subcontractor

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1 on the project; the records shall include:
2 (A) the worker's name;
3 (B) the worker's address;
4 (C) the worker's telephone number, if available;
5 (D) the worker's social security number;
6 (E) the worker's classification or
7 classifications;
8 (F) the worker's gross and net wages paid in each
9 pay period;
10 (G) the worker's number of hours worked each day;
11 (H) the worker's starting and ending times of work
12 each day;
13 (I) the worker's hourly wage rate; and
14 (J) the worker's hourly overtime wage rate;
15 (2) no later than the 15th day of each calendar month,
16 provide a certified payroll for the immediately preceding
17 month to the taxpayer in charge of the High Impact Business
18 construction jobs project; within 5 business days after
19 receiving the certified payroll, the taxpayer shall file
20 the certified payroll with the Department of Labor and the
21 Department of Commerce and Economic Opportunity; a
22 certified payroll must be filed for only those calendar
23 months during which construction on a High Impact Business
24 construction jobs project has occurred; the certified
25 payroll shall consist of a complete copy of the records
26 identified in paragraph (1) of this subsection (j), but may

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1 exclude the starting and ending times of work each day; the
2 certified payroll shall be accompanied by a statement
3 signed by the contractor or subcontractor or an officer,
4 employee, or agent of the contractor or subcontractor which
5 avers that:
6 (A) he or she has examined the certified payroll
7 records required to be submitted by the Act and such
8 records are true and accurate; and
9 (B) the contractor or subcontractor is aware that
10 filing a certified payroll that he or she knows to be
11 false is a Class A misdemeanor.
12 A general contractor is not prohibited from relying on a
13certified payroll of a lower-tier subcontractor, provided the
14general contractor does not knowingly rely upon a
15subcontractor's false certification.
16 Any contractor or subcontractor subject to this
17subsection, and any officer, employee, or agent of such
18contractor or subcontractor whose duty as an officer, employee,
19or agent it is to file a certified payroll under this
20subsection, who willfully fails to file such a certified
21payroll on or before the date such certified payroll is
22required by this paragraph to be filed and any person who
23willfully files a false certified payroll that is false as to
24any material fact is in violation of this Act and guilty of a
25Class A misdemeanor.
26 The taxpayer in charge of the project shall keep the

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1records submitted in accordance with this subsection on or
2after the effective date of this amendatory Act of the 101st
3General Assembly for a period of 5 years from the date of the
4last payment for work on a contract or subcontract for the High
5Impact Business construction jobs project.
6 The records submitted in accordance with this subsection
7shall be considered public records, except an employee's
8address, telephone number, and social security number, and made
9available in accordance with the Freedom of Information Act.
10The Department of Labor shall accept any reasonable submissions
11by the contractor that meet the requirements of this subsection
12(j) and shall share the information with the Department in
13order to comply with the awarding of a High Impact Business
14construction jobs credit. A contractor, subcontractor, or
15public body may retain records required under this Section in
16paper or electronic format.
17 (k) Upon 7 business days' notice, each contractor and
18subcontractor shall make available for inspection and copying
19at a location within this State during reasonable hours, the
20records identified in this subsection (j) to the taxpayer in
21charge of the High Impact Business construction jobs project,
22its officers and agents, the Director of the Department of
23Labor and his deputies and agents, and to federal, State, or
24local law enforcement agencies and prosecutors.
25(Source: P.A. 101-9, eff. 6-5-19.)
26 Section 99. Effective date. This Act takes effect upon

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1becoming law.
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