Bill Text: IL SB1391 | 2011-2012 | 97th General Assembly | Introduced
Bill Title: Amends the Corporate Accountability for Tax Expenditures Act. Provides that, for certain programs based on job creation or retention, beginning in 2007 and through 2011, a recipient shall be deemed in compliance with those job creation or job retention requirements by establishing that it has created or maintained the requisite number of jobs based on a 3-year average, including the current reporting year and the 2 immediately preceding reporting years. Effective immediately.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2013-01-08 - Session Sine Die [SB1391 Detail]
Download: Illinois-2011-SB1391-Introduced.html
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| 1 | AN ACT concerning revenue.
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| 2 | Be it enacted by the People of the State of Illinois,
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| 3 | represented in the General Assembly:
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| 4 | Section 5. The Corporate Accountability for Tax | ||||||||||||||||||||||||
| 5 | Expenditures Act is amended by changing Section 25 as follows:
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| 6 | (20 ILCS 715/25)
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| 7 | Sec. 25. Recapture.
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| 8 | (a) All development assistance agreements
shall contain, | ||||||||||||||||||||||||
| 9 | at a
minimum, the following recapture provisions:
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| 10 | (1) The recipient must (i) make the level of capital | ||||||||||||||||||||||||
| 11 | investment in the
economic
development project specified | ||||||||||||||||||||||||
| 12 | in the development assistance agreement; (ii)
create or
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| 13 | retain, or both, the requisite number of jobs, paying not | ||||||||||||||||||||||||
| 14 | less than specified
wages for the
created and retained | ||||||||||||||||||||||||
| 15 | jobs, within and for the duration of the time period
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| 16 | specified in the
legislation authorizing, or the | ||||||||||||||||||||||||
| 17 | administrative rules implementing, the
development
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| 18 | assistance programs and the development assistance | ||||||||||||||||||||||||
| 19 | agreement.
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| 20 | (2) If the recipient fails to create or retain the | ||||||||||||||||||||||||
| 21 | requisite number of
jobs within and
for the time period | ||||||||||||||||||||||||
| 22 | specified, in the legislation authorizing, or the
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| 23 | administrative rules
implementing, the development | ||||||||||||||||||||||||
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| 1 | assistance programs and the development
assistance
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| 2 | agreement, the recipient shall be deemed to no longer | ||||||
| 3 | qualify for the State
economic
assistance and the | ||||||
| 4 | applicable recapture provisions shall take effect. | ||||||
| 5 | Beginning January 1, 2007 through December 31, 2011, a | ||||||
| 6 | recipient shall be deemed in compliance with all such job | ||||||
| 7 | creation or job retention requirements by establishing | ||||||
| 8 | that the recipient has created or maintained the requisite | ||||||
| 9 | number of jobs based on a 3-year average, including the | ||||||
| 10 | current reporting year and the 2 immediately preceding | ||||||
| 11 | reporting years.
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| 12 | (3) If the recipient receives State economic | ||||||
| 13 | assistance in the form of a
High
Impact Business | ||||||
| 14 | designation pursuant to Section 5.5 of the Illinois | ||||||
| 15 | Enterprise
Zone Act
and the business receives the benefit | ||||||
| 16 | of the exemption authorized under Section
5l of the
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| 17 | Retailers' Occupation Tax Act (for the sale of building | ||||||
| 18 | materials incorporated
into a High
Impact Business | ||||||
| 19 | location) and the recipient fails to create or retain the
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| 20 | requisite number
of jobs, as determined by the legislation | ||||||
| 21 | authorizing the development
assistance
programs
or the | ||||||
| 22 | administrative rules implementing such legislation, or | ||||||
| 23 | both, within the
requisite
period of time, the recipient | ||||||
| 24 | shall be required to pay to the State the full
amount of | ||||||
| 25 | the
State tax exemption that it received as a result of the | ||||||
| 26 | High Impact Business
designation. Beginning January 1, | ||||||
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| 1 | 2007 through December 31, 2011, a recipient shall be deemed | ||||||
| 2 | in compliance with all such job creation or job retention | ||||||
| 3 | requirements by establishing that the recipient has | ||||||
| 4 | created or maintained the requisite number of jobs based on | ||||||
| 5 | a 3-year average, including the current reporting year and | ||||||
| 6 | the 2 immediately preceding reporting years.
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| 7 | (4) If the recipient receives a grant or loan pursuant | ||||||
| 8 | to the Large
Business
Development Program, the Business | ||||||
| 9 | Development Public Infrastructure Program, or
the
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| 10 | Industrial Training Program and the recipient fails to | ||||||
| 11 | create or retain the
requisite number
of jobs for the | ||||||
| 12 | requisite time period, as provided in the legislation
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| 13 | authorizing the
development assistance programs or the | ||||||
| 14 | administrative rules implementing such
legislation, or | ||||||
| 15 | both, or in the development assistance agreement, the | ||||||
| 16 | recipient
shall be
required to repay to the State a pro | ||||||
| 17 | rata amount of the grant; that amount
shall
reflect
the | ||||||
| 18 | percentage of the deficiency between the requisite number | ||||||
| 19 | of jobs to be
created or
retained by the recipient and the | ||||||
| 20 | actual number of such jobs in existence as of
the date the
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| 21 | Department determines the recipient is in breach of the job | ||||||
| 22 | creation or
retention
covenants contained in the | ||||||
| 23 | development assistance agreement. If the recipient
of
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| 24 | development assistance under the Large Business | ||||||
| 25 | Development Program, the
Business
Development Public | ||||||
| 26 | Infrastructure Program, or the Industrial Training Program
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| 1 | ceases
operations at the specific project site, during the | ||||||
| 2 | 5-year period commencing on
the date of
assistance, the | ||||||
| 3 | recipient shall be required to repay the entire amount of | ||||||
| 4 | the
grant or to
accelerate repayment of the loan back to | ||||||
| 5 | the State.
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| 6 | (5) If the recipient receives a tax credit under the | ||||||
| 7 | Economic
Development for a
Growing Economy tax credit | ||||||
| 8 | program, the development assistance agreement must
provide | ||||||
| 9 | that (i) if the number of new or retained employees falls | ||||||
| 10 | below the
requisite
number set forth in the development | ||||||
| 11 | assistance agreement, the allowance of the
credit
shall be | ||||||
| 12 | automatically suspended until the number of new and | ||||||
| 13 | retained employees
equals
or exceeds the requisite number | ||||||
| 14 | in the development assistance agreement; (ii)
if
the
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| 15 | recipient discontinues operations at the specific project | ||||||
| 16 | site during the first
5 years of the
10-year term of the | ||||||
| 17 | development assistance agreement, the recipient shall
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| 18 | forfeit all
credits taken by the recipient during such | ||||||
| 19 | 5-year period; and (iii) in the
event
of a
revocation or | ||||||
| 20 | suspension of the credit, the Department shall contact the
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| 21 | Director
of Revenue to initiate proceedings against the | ||||||
| 22 | recipient to recover
wrongfully
exempted Illinois State | ||||||
| 23 | income taxes and the recipient shall promptly repay to
the
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| 24 | Department of Revenue any wrongfully exempted Illinois | ||||||
| 25 | State income taxes.
The forfeited amount of credits shall | ||||||
| 26 | be deemed assessed on the date the
Department
contacts the | ||||||
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| 1 | Department of Revenue and the recipient shall promptly | ||||||
| 2 | repay to
the
Department of Revenue any wrongfully exempted | ||||||
| 3 | Illinois State income taxes.
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| 4 | (b) The Director may elect to waive enforcement of any | ||||||
| 5 | contractual provision
arising out of
the development | ||||||
| 6 | assistance agreement required by this Act based on a finding
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| 7 | that the waiver is
necessary to avert an imminent and | ||||||
| 8 | demonstrable hardship to the
recipient that may
result in such | ||||||
| 9 | recipient's insolvency or discharge of workers.
If a waiver is
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| 10 | granted, the recipient must agree to a contractual | ||||||
| 11 | modification, including
recapture provisions,
to the
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| 12 | development assistance
agreement.
The existence of
any waiver
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| 13 | granted pursuant to this subsection (c), the date of the | ||||||
| 14 | granting of such
waiver, and a brief
summary of the reasons | ||||||
| 15 | supporting the granting of such waiver shall be
disclosed
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| 16 | consistent with
the provisions of Section 25 of this Act.
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| 17 | (c) Beginning June 1, 2004, the Department shall annually | ||||||
| 18 | compile a report
on the
outcomes and effectiveness of recapture | ||||||
| 19 | provisions by program, including but
not limited
to: (i) the | ||||||
| 20 | total number of companies that receive development assistance | ||||||
| 21 | as
defined in
this Act; (ii) the total number of recipients in | ||||||
| 22 | violation of development
agreements with
the Department; (iii) | ||||||
| 23 | the total number of completed recapture efforts; (iv) the
total
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| 24 | number of recapture efforts initiated; and (v) the number of | ||||||
| 25 | waivers granted.
This report
shall be disclosed consistent with | ||||||
| 26 | the provisions of Section 20 of this Act.
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| 1 | (d) For the purposes of this Act, recapture provisions do | ||||||
| 2 | not include the
Illinois
Department of Transportation Economic | ||||||
| 3 | Development Program, any grants under the
Industrial Training | ||||||
| 4 | Program that are not given as an incentive to a
recipient | ||||||
| 5 | business organization,
or any successor programs as described | ||||||
| 6 | in the term "development assistance" in
Section 5
of this Act.
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| 7 | (Source: P.A. 93-552, eff. 8-20-03.)
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| 8 | Section 99. Effective date. This Act takes effect upon | ||||||
| 9 | becoming law.
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