Bill Text: IL HB5797 | 2025-2026 | 104th General Assembly | Introduced

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Bill Title: Creates the Taxpayer and Investment Protection Act. Provides that a developer that undertakes a qualifying project may apply to the Department of Commerce and Economic Opportunity for certain benefits authorized under the Act, including, but not limited to, a negotiated property tax agreement and infrastructure support if the project satisfies certain job creation, investment, and location requirements. Provides that one or more taxing bodies may enter into a negotiated property tax agreement with the developer of a qualifying project. Provides that the agreement shall provide for a single annual payment in full satisfaction of all ad valorem property taxes that would otherwise be levied on the improvements constructed on the project site as part of the qualifying project. Provides that the State may provide infrastructure support for public infrastructure improvements that directly benefit a qualifying project and provide broader public benefit to the region in which the project is located. Amends the Property Tax Code to make conforming changes. Effective immediately.

Sponsorship: Partisan Bill (Republican 1)

Status: (Introduced - Dead) 2026-06-15 - Filed with the Clerk by Rep. Martin McLaughlin [HB5797 Detail]

Download: Illinois-2025-HB5797-Introduced.html

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104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026HB5797 Introduced , by Rep. Martin McLaughlin SYNOPSIS AS INTRODUCED:
New Act
35 ILCS 200/Art. 10 Div. 23 heading new
35 ILCS 200/10-1000 new
Creates the Taxpayer and Investment Protection Act. Provides that a developer that undertakes a qualifying project may apply to the Department of Commerce and Economic Opportunity for certain benefits authorized under the Act, including, but not limited to, a negotiated property tax agreement and infrastructure support if the project satisfies certain job creation, investment, and location requirements. Provides that one or more taxing bodies may enter into a negotiated property tax agreement with the developer of a qualifying project. Provides that the agreement shall provide for a single annual payment in full satisfaction of all ad valorem property taxes that would otherwise be levied on the improvements constructed on the project site as part of the qualifying project. Provides that the State may provide infrastructure support for public infrastructure improvements that directly benefit a qualifying project and provide broader public benefit to the region in which the project is located. Amends the Property Tax Code to make conforming changes. Effective immediately.
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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 1. Short title. This Act may be cited as the
Taxpayer and Investment Protection Act.
Section 5. Legislative findings and declarations.
(a) The General Assembly finds that:
(1) The State of Illinois competes vigorously with
other states and jurisdictions to attract major private
capital investment capable of generating transformative
economic benefits, including the creation of tens of
thousands of construction and permanent jobs, substantial
expansion of the property and sales tax base, and
long-term regional economic development.
(2) Recent large-scale development projects across the
United States, including SoFi Stadium in Los Angeles,
Allegiant Stadium in Las Vegas, Nissan Stadium in
Nashville, and Highmark Stadium in Orchard Park, New York,
demonstrate both the opportunities and the challenges
associated with such projects.
(3) Very large-scale private developments involving
private capital investment exceeding $2,500,000,000
present unique opportunities for economic growth but also

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unique fiscal and infrastructure challenges, including
significant demands on regional transportation, utilities,
and public services, as well as substantial impacts on
existing property tax bases and local government budgets.
(4) A general statutory framework applicable to
qualifying large-scale private developments in the State's
most populous counties provides necessary certainty to
investors, protects local taxing bodies and residents from
undue burden, promotes transparency and accountability,
and avoids the constitutional concerns associated with
purely project-specific or special legislation by
establishing clear, generally applicable eligibility
criteria and procedures.
(b) It is the policy of this State and the purpose of this
Act to:
(1) encourage transformative private investment and
job creation while ensuring that the costs of growth are
not unfairly shifted onto existing taxpayers and that any
public participation is limited, transparent,
performance-based, and accompanied by rigorous independent
review, measurable commitments, and enforceable remedies,
including repayment obligations; and
(2) establish clear, predictable, and highly
protective procedures under which qualifying private
developments may receive limited property tax certainty
through a payment in lieu of taxes and targeted public

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infrastructure support, subject to mandatory independent
fiscal neutrality determinations, long-term operational
commitments with repayment consequences, strong clawback
mechanisms, and comprehensive transparency requirements.
Section 10. Definitions. As used in this Act:
"Affected taxing body" means a taxing body in which all or
a portion of a qualifying project is located.
"Certification" means the written fiscal neutrality
determination issued under Section 30 of this Act.
"Commission" means the Commission on Government
Forecasting and Accountability.
"Department" means the Department of Commerce and Economic
Opportunity.
"Developer" means any individual, corporation, limited
liability company, partnership, or consortium that undertakes
or proposes to undertake a qualifying project.
"Development agreement" means the comprehensive agreement
required under Section 35 of this Act.
"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
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

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hours each week.
"Infrastructure support" means financial or other
assistance authorized under Section 25 of this Act for public
infrastructure improvements.
"Job creation target" means the employment of at least 500
new full-time employees who are hired to support the business
operations for the life of the project and who reside in the
State.
"NPT" or "negotiated property tax" means a negotiated
property tax payment made by a developer to one or more taxing
bodies in lieu of the ad valorem property taxes that would
otherwise be due on improvements constructed as part of a
qualifying project.
"Project site" means the real property on which a
qualifying project is or will be developed, as more
particularly described in the applicable development
agreement.
"Qualifying project" means a private development that: (i)
meets the job creation target set forth in this Section; (ii)
involves total private capital investment exceeding
$2,500,000,000; and (iii) is located in a county with a
population that exceeds 1,000,000 according to the most recent
federal decennial census for which data is available prior to
the date on which the application is submitted to the
Department.
"Taxing body" means any unit of local government, school

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district, community college district, or other entity
authorized by law to levy ad valorem property taxes in the
State of Illinois.
Section 15. Eligibility for benefits. A developer that
undertakes a qualifying project may apply to the Department
for the benefits authorized under this Act, including, but not
limited to, an NPT agreement and infrastructure support, if
the developer executes a development agreement containing all
commitments required by this Act.
Section 20. NPT agreements authorized.
(a) Upon satisfaction of the requirements of this Act, one
or more taxing bodies may enter into an NPT agreement with the
developer of a qualifying project.
(b) An NPT agreement shall provide for a single annual NPT
payment in full satisfaction of all ad valorem property taxes
that would otherwise be levied on the improvements constructed
on the project site as part of the qualifying project.
(c) The initial amount of the annual NPT payment shall be
determined through good-faith negotiation between the
developer and the affected taxing bodies. The negotiation
process shall follow these structured steps to ensure
transparency, fairness, and alignment with taxpayer
protections:
(1) Within 30 days after submitting its application

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under Section 15, the developer shall provide each
affected taxing body with an initial proposal, including a
proposed NPT amount and a preliminary fiscal impact
analysis prepared by an independent third party.
(2) Each affected taxing body shall have 45 days after
receipt of the initial proposal to review the proposal and
provide a written response, which may include a
counter-proposal, requests for additional information, or
proposed modifications.
(3) The parties shall conduct at least 2 good-faith
negotiation meetings, in person or virtually, within 60
days after the initial proposal is received by each of the
taxing bodies.
(4) If the parties are unable to reach an agreement
within 90 days after the initial proposal is received by
each of the taxing bodies, any of the parties may request
non binding mediation by a neutral third party mutually
selected or facilitated by the Department.
(5) In all negotiations, the parties shall consider:
(i) the certification required under Section 30; (ii)
projected service cost increases for the taxing bodies;
(iii) the economic benefits to the community; (iv) the
requirement to avoid any net shift of tax burden to
existing taxpayers; and (v) the allocation for homeowner
property tax relief.
(6) The final NPT agreement shall be subject to at

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least one public hearing in each affected taxing body
before approval by formal resolution of the governing body
of each affected taxing body. Notice of the hearing and
the proposed NPT amount shall be published on the
Department's website at least 14 days prior to the
hearing.
(7) The payment amount, when considered together with
taxes generated by other components of the qualifying
project, must be sufficient to avoid any net shift of ad
valorem property tax burden onto existing taxpayers within
the affected taxing bodies, as confirmed by the
certification required under Section 30.
(8) The annual NPT payment shall increase by 2.5% on
each anniversary of the effective date of the NPT
agreement.
(9) The term of any NPT agreement shall not exceed 40
years from the date of substantial completion of the
qualifying project.
(d) Each NPT agreement shall provide that at least 50% of
the annual NPT revenues shall be allocated to provide direct
property tax relief to residential property owners within the
taxing bodies in a manner determined by the parties or as
otherwise provided by law or intergovernmental agreement.
(e) No NPT agreement shall become effective until the
certification required under Section 30 has been issued and
the development agreement required under Section 35 has been

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executed.
Section 25. Infrastructure support authorized; conditions.
(a) Subject to appropriation and the requirements of this
Act, the State may provide infrastructure support for public
infrastructure improvements that directly benefit a qualifying
project and provide broader public benefit to the region in
which the project is located.
(b) The total amount of infrastructure support authorized
under this Act for any single qualifying project shall not
exceed $1,200,000,000.
(c) Eligible public infrastructure improvements include
highway and road access improvements, transit connections and
related facilities, utility extensions and upgrades,
stormwater management facilities, and public safety
facilities.
(d) The developer shall be solely and exclusively
responsible for the costs of eligible infrastructure
improvements that exceed the total amount of infrastructure
support authorized under this Act or that are not approved as
part of the development agreement.
(e) Infrastructure support shall be provided only pursuant
to a development agreement that includes a dedicated revenue
recapture plan. The recapture plan shall dedicate a portion of
incremental sales taxes, hotel taxes, and other revenues
generated by the qualifying project to the repayment or offset

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of State costs associated with the infrastructure support over
a period not to exceed the term of the NPT agreement.
(f) Infrastructure support shall be disbursed in tranches
only upon a written determination by the Department or by an
independent reviewer designated in the development agreement
that specified milestones set forth in the development
agreement have been achieved.
(g) The developer shall be responsible for the ongoing
maintenance of any infrastructure improvements constructed
with infrastructure support that are located on or primarily
serve the project site, unless otherwise provided in the
development agreement.
Section 30. Fiscal neutrality certification required.
(a) No NPT agreement or infrastructure support under this
Act may take effect until the Commission issues a written
fiscal neutrality certification in accordance with subsection
(b). If the Commission declines to issue the certification or
fails to act within 45 days after receiving a complete
request, the certification shall be issued by an independent
fiscal reviewer jointly selected by the affected taxing bodies
and the Department.
(b) The certification shall state, based on reasonable
assumptions, methodologies, and independent economic and
fiscal modeling, that the proposed NPT agreement and
infrastructure support are projected to result in a net

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positive fiscal impact for the taxing bodies over the full
term of the agreements after accounting for all new tax
revenues, NPT payments, infrastructure support costs
(including any associated debt service or repayment
obligations), and reasonably anticipated increases in demand
for local government services attributable to the qualifying
project. The certification must include specific findings that
no net shift of ad valorem property tax burden to existing
taxpayers will occur as a result of the proposed NPT agreement
or infrastructure support.
(c) The certification must specifically address and make
explicit findings regarding whether the agreements will result
in any shift of ad valorem property tax burden to existing
residential or commercial property owners within the affected
taxing bodies.
(d) In preparing the certification, the Commission or
independent reviewer, as applicable, shall consider, at a
minimum:
(1) the amount, timing, and growth rate of NPT
payments and new tax revenues generated by the qualifying
project;
(2) the amount, timing, and repayment structure of any
infrastructure support;
(3) the projected increases in demand for police,
fire, emergency medical, school, and other local
government services attributable to the qualifying project

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and its employees and visitors;
(4) the allocation of NPT revenues for direct
residential property tax relief; and
(5) any other factors the Commission or reviewer deems
relevant to a complete fiscal impact analysis.
(e) The certification shall be completed, issued in
writing, and made available to the public on the Department's
website for a period of at least 14 days before the execution
of any development agreement.
(f) The Department shall adopt rules establishing minimum
standards and requirements for the economic and fiscal
modeling used in the certification process.
Section 35. Development agreement required.
(a) Before any NPT agreement or infrastructure support
under this Act may take effect, the developer and the taxing
bodies shall execute a comprehensive development agreement.
(b) The development agreement shall include, at a minimum,
the following provisions:
(1) specific, measurable, and independently verifiable
targets for total private capital investment in the
qualifying project and for the creation of
construction-phase and permanent private-sector jobs;
(2) a detailed project schedule with enforceable
milestones for permitting, financing, groundbreaking,
substantial completion, and commencement of operations;

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(3) provisions for workforce training, registered
apprenticeship programs, and good-faith efforts to hire
Illinois residents, with particular emphasis on residents
of the communities in which the project site is located;
(4) a long-term operational commitment by the
developer to maintain the primary economic activity of the
qualifying project at the project site for a minimum
period of 30 years from the date of substantial
completion, together with a provision requiring pro rata
repayment of any infrastructure support previously
provided (together with interest at a commercially
reasonable rate specified in the development agreement) if
the developer materially ceases such primary economic
activity or relocates it outside the State of Illinois
before the expiration of that period;
(5) claw back, recapture, and remedy provisions
consistent with Section 40 of this Act;
(6) requirements for annual public reporting on
investment levels, job creation, and compliance with the
development agreement, together with provisions for
independent audits of such reports at the developer's
expense;
(7) provisions addressing the developer's
responsibility for ongoing maintenance of infrastructure
improvements constructed with infrastructure support; and
(8) an acknowledgment that all benefits authorized

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under this Act are expressly conditioned upon issuance of
the certification required under Section 30 and ongoing
compliance with the development agreement.
(c) The development agreement shall be subject to at least
one public hearing in each municipality in which the project
site is located and shall be a public record subject to
disclosure under the Freedom of Information Act.
Section 40. Oversight, reporting, audits, and remedies.
(a) The developer shall submit to the Department and to
each affected taxing body an annual report, in a form and
containing such information as the Department may prescribe by
rule, detailing the amount of private capital invested, the
number and types of jobs created, NPT payments made, and
compliance with all terms of the development agreement during
the preceding calendar year.
(b) The Department may, at any time, conduct or cause to be
conducted an independent audit of the developer's books and
records to verify the accuracy of any report submitted under
this Section. The cost of any such audit shall be borne by the
developer if material discrepancies are found.
(c) If the developer fails to substantially complete the
qualifying project by the date specified in the development
agreement, materially fails to meet the private investment or
job creation target, or materially breaches the long-term
operational commitment required under Section 35, then, in

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addition to any other remedies available at law or in equity:
(1) any NPT agreement then in effect shall
automatically terminate, and the project site and all
improvements thereon shall become subject to ad valorem
property taxation under the general laws of this State
from and after the date of such termination; and
(2) any infrastructure support previously disbursed to
or on behalf of the developer shall become immediately due
and payable to the State of Illinois, together with
interest at the rate specified in the development
agreement.
(d) The Attorney General may bring a civil action in the
name of the People of the State of Illinois to enforce the
provisions of this Act, any rule adopted under this Act, or any
development agreement entered into pursuant to this Act.
Section 45. Projects to be valued at equalized assessed
value. No affected taxing body shall increase its tax rate or
extend additional taxes on any property not subject to an NPT
agreement under this Act for the purpose of offsetting or
compensating for any reduction in revenue resulting from an
NPT agreement. Any revenue shortfall attributable to an NPT
agreement shall be absorbed within the existing tax rates and
extension limitations applicable to properties not subject to
the NPT agreement consistent with the fiscal neutrality
certification required under Section 30.

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Section 50. Ethics and transparency requirements.
(a) No elected official or employee of the State of
Illinois or of any affected taxing body who participates in
the review, negotiation, or approval of any application, NPT
agreement, development agreement, or infrastructure support
under this Act shall accept any gift, gratuity, entertainment,
or thing of value from the developer or from any person or
entity affiliated with or acting on behalf of the developer,
except as may be expressly permitted under the State Officials
and Employees Ethics Act or applicable local ethics ordinances
or rules.
(b) All documents relating to a qualifying project under
this Act, including, but not limited to, the application, the
certification, the development agreement, annual reports, and
the results of any audits, shall be public records subject to
inspection and copying under the Freedom of Information Act.
Section 55. Relationship to other laws. This Act is
intended to supplement and not to limit, repeal, or otherwise
affect any other provision of State law authorizing economic
development incentives, tax increment financing, enterprise
zones, or infrastructure assistance. With respect to
qualifying projects, this Act shall control over any
conflicting provisions of the Property Tax Code, including
provisions governing the valuation, assessment, levy, or

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collection of property taxes on improvements subject to an NPT
agreement. In the event of any conflict between the provisions
of this Act and any other law with respect to a qualifying
project, the provisions of this Act shall control.
Section 60. Rulemaking authority. The Department may adopt
such rules as are necessary or appropriate to implement and
administer this Act, including but not limited to rules
governing the form and content of applications, the
certification process, the minimum contents of development
agreements, reporting requirements, and audit procedures.
Section 65. Severability. If any provision of this Act or
its application to any person or circumstance is held invalid
by a court of competent jurisdiction, such invalidity shall
not affect any other provision or application of this Act that
can be given effect without the invalid provision or
application.
Section 900. The Property Tax Code is amended by adding
Division 23 to Article 10 as follows:
(35 ILCS 200/Art. 10 Div. 23 heading new)
Division 23. Taxpayer and Investment Protection Act.
(35 ILCS 200/10-1000 new)

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Sec. 10-1000. Taxpayer and Investment Protection Act. One
or more taxing bodies may enter into a negotiated property tax
agreement with the developer of a qualifying project as
provided in the Taxpayer and Investment Protection Act. As
used in this Section, the terms "negotiated property tax" and
"taxing body" have the meanings given to those terms in the
Taxpayer and Investment Protection Act.
Section 999. Effective date. This Act takes effect upon
becoming law.