Bill Text: IL SB2188 | 2021-2022 | 102nd General Assembly | Introduced

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Bill Title: Amends the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois. Provides that a qualifying Illinois data center is a place, among other criteria, that within 2 years (currently, 90 days) after being placed in service, certifies that it is carbon neutral or has attained other specified certification. Amends the Brownfields Redevelopment and Intermodal Promotion Act. Extends the use of the South Suburban Brownfields Redevelopment Fund. Amends the New Markets Development Program Act. Modifies provisions concerning certification of qualified equity investments and allocation thereof. Provides further rulemaking requirements. Provides that for fiscal years following fiscal year 2026 (currently, 2021), qualified equity investments under the Act shall not be made unless reauthorization is made. Makes other changes. Effective immediately.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2021-04-16 - Rule 3-9(a) / Re-referred to Assignments [SB2188 Detail]

Download: Illinois-2021-SB2188-Introduced.html

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102ND GENERAL ASSEMBLY State of Illinois 2021 and 2022 SB2188 Introduced 2/26/2021, by Sen. Elgie R. Sims, Jr. SYNOPSIS AS INTRODUCED:
20 ILCS 605/605-1025
20 ILCS 607/3-20
20 ILCS 663/25
20 ILCS 663/45
20 ILCS 663/50
Amends the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois. Provides that a qualifying Illinois date center is a place, among other criteria, that within 2 years (currently, 90 days) after being placed in service, certifies that it is carbon neutral or has attained other specified certification. Amends the Brownfields Redevelopment and Intermodal Promotion Act. Extends the use of the South Suburban Brownfields Redevelopment Fund. Amends the New Markets Development Program Act. Modifies provisions concerning certification of qualified equity investments and allocation thereof. Provides further rulemaking requirements. Provides that for fiscal years following fiscal year 2026 (currently, 2021), qualified equity investments under the Act shall not be made unless reauthorization is made. Makes other changes. Effective immediately.
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A BILL FOR
SB2188 LRB102 17105 RJF 22534 b
AN ACT concerning State government.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Department of Commerce and Economic
Opportunity Law of the Civil Administrative Code of Illinois
is amended by changing Section 605-1025 as follows:
(20 ILCS 605/605-1025)
Sec. 605-1025. Data center investment.
(a) The Department shall issue certificates of exemption
from the Retailers' Occupation Tax Act, the Use Tax Act, the
Service Use Tax Act, and the Service Occupation Tax Act, all
locally-imposed retailers' occupation taxes administered and
collected by the Department, the Chicago non-titled Use Tax,
and a credit certification against the taxes imposed under
subsections (a) and (b) of Section 201 of the Illinois Income
Tax Act to qualifying Illinois data centers.
(b) For taxable years beginning on or after January 1,
2019, the Department shall award credits against the taxes
imposed under subsections (a) and (b) of Section 201 of the
Illinois Income Tax Act as provided in Section 229 of the
Illinois Income Tax Act.
(c) For purposes of this Section:
"Data center" means a facility: (1) whose primary

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services are the storage, management, and processing of
digital data; and (2) that is used to house (i) computer
and network systems, including associated components such
as servers, network equipment and appliances,
telecommunications, and data storage systems, (ii) systems
for monitoring and managing infrastructure performance,
(iii) Internet-related equipment and services, (iv) data
communications connections, (v) environmental controls,
(vi) fire protection systems, and (vii) security systems
and services.
"Qualifying Illinois data center" means a new or
existing data center that:
(1) is located in the State of Illinois;
(2) in the case of an existing data center, made a
capital investment of at least $250,000,000
collectively by the data center operator and the
tenants of the data center over the 60-month period
immediately prior to January 1, 2020 or committed to
make a capital investment of at least $250,000,000
over a 60-month period commencing before January 1,
2020 and ending after January 1, 2020; or
(3) in the case of a new data center, or an
existing data center making an upgrade, makes a
capital investment of at least $250,000,000 over a
60-month period beginning on or after January 1, 2020;
and

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(4) in the case of both existing and new data
centers, results in the creation of at least 20
full-time or full-time equivalent new jobs over a
period of 60 months by the data center operator and the
tenants of the data center, collectively, associated
with the operation or maintenance of the data center;
those jobs must have a total compensation equal to or
greater than 120% of the average 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
(5) within 2 years 90 days after being placed in
service, certifies to the Department that it is carbon
neutral or has attained certification under one or
more of the following green building standards:
(A) BREEAM for New Construction or BREEAM
In-Use;
(B) ENERGY STAR;
(C) Envision;
(D) ISO 50001-energy management;
(E) LEED for Building Design and Construction
or LEED for Operations and Maintenance;
(F) Green Globes for New Construction or Green
Globes for Existing Buildings;
(G) UL 3223; or
(H) an equivalent program approved by the

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Department of Commerce and Economic Opportunity.
"Full-time equivalent job" means a job in which the
new employee works for the owner, operator, contractor, or
tenant of a data center or for a corporation under
contract with the owner, operator or tenant of a data
center at a rate of at least 35 hours per week. An owner,
operator or tenant who employs labor or services at a
specific site or facility under contract with another may
declare one full-time, permanent 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 tangible personal property" means:
electrical systems and equipment; climate control and
chilling equipment and systems; mechanical systems and
equipment; monitoring and secure systems; emergency
generators; hardware; computers; servers; data storage
devices; network connectivity equipment; racks; cabinets;
telecommunications cabling infrastructure; raised floor
systems; peripheral components or systems; software;
mechanical, electrical, or plumbing systems; battery
systems; cooling systems and towers; temperature control
systems; other cabling; and other data center
infrastructure equipment and systems necessary to operate
qualified tangible personal property, including fixtures;
and component parts of any of the foregoing, including

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installation, maintenance, repair, refurbishment, and
replacement of qualified tangible personal property to
generate, transform, transmit, distribute, or manage
electricity necessary to operate qualified tangible
personal property; and all other tangible personal
property that is essential to the operations of a computer
data center. "Qualified tangible personal property" also
includes building materials physically incorporated in to
the qualifying data center.
To document the exemption allowed under this Section, the
retailer must obtain from the purchaser a copy of the
certificate of eligibility issued by the Department.
(d) New and existing data centers seeking a certificate of
exemption for new or existing facilities shall apply to the
Department in the manner specified by the Department. The
Department shall determine the duration of the certificate of
exemption awarded under this Act. The duration of the
certificate of exemption may not exceed 20 calendar years. The
Department and any data center seeking the exemption,
including a data center operator on behalf of itself and its
tenants, must enter into a memorandum of understanding that at
a minimum provides:
(1) the details for determining the amount of capital
investment to be made;
(2) the number of new jobs created;
(3) the timeline for achieving the capital investment

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and new job goals;
(4) the repayment obligation should those goals not be
achieved and any conditions under which repayment by the
qualifying data center or data center tenant claiming the
exemption will be required;
(5) the duration of the exemption; and
(6) other provisions as deemed necessary by the
Department.
(e) Beginning July 1, 2021, and each year thereafter, the
Department shall annually report to the Governor and the
General Assembly on the outcomes and effectiveness of Public
Act 101-31 that shall include the following:
(1) the name of each recipient business;
(2) the location of the project;
(3) the estimated value of the credit;
(4) the number of new jobs and, if applicable,
retained jobs pledged as a result of the project; and
(5) whether or not the project is located in an
underserved area.
(f) New and existing data centers seeking a certificate of
exemption related to the rehabilitation or construction of
data centers in the State shall require the contractor and all
subcontractors to comply with the requirements of Section
30-22 of the Illinois Procurement Code as they apply to
responsible bidders and to present satisfactory evidence of
that compliance to the Department.

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(g) New and existing data centers seeking a certificate of
exemption for the rehabilitation or construction of data
centers in the State shall require the contractor to enter
into a project labor agreement approved by the Department.
(h) Any qualifying data center issued a certificate of
exemption under this Section must annually report to the
Department the total data center tax benefits that are
received by the business. Reports are due no later than May 31
of each year and shall cover the previous calendar year. The
first report is for the 2019 calendar year and is due no later
than May 31, 2020.
To the extent that a business issued a certificate of
exemption under this Section has obtained an Enterprise Zone
Building Materials Exemption Certificate or a High Impact
Business Building Materials Exemption Certificate, no
additional reporting for those building materials exemption
benefits is required under this Section.
Failure to file a report under this subsection (h) may
result in suspension or revocation of the certificate of
exemption. Factors to be considered in determining whether a
data center certificate of exemption shall be suspended or
revoked include, but are not limited to, prior compliance with
the reporting requirements, cooperation in discontinuing and
correcting violations, the extent of the violation, and
whether the violation was willful or inadvertent.
(i) The Department shall not issue any new certificates of

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exemption under the provisions of this Section after July 1,
2029. This sunset shall not affect any existing certificates
of exemption in effect on July 1, 2029.
(j) The Department shall adopt rules to implement and
administer this Section.
(Source: P.A. 101-31, eff. 6-28-19; 101-604, eff. 12-13-19.)
Section 10. The Brownfields Redevelopment and Intermodal
Promotion Act is amended by changing Section 3-20 as follows:
(20 ILCS 607/3-20)
Sec. 3-20. South Suburban Brownfields Redevelopment Fund;
eligible projects. In State fiscal years 2015 through 2031
2021, all moneys in the South Suburban Brownfields
Redevelopment Fund shall be held solely to fund eligible
projects undertaken pursuant to the provisions of Section 3-35
of this Act and performed either directly by Cook County
through a development agreement with the Department, by an
entity designated by Cook County through a development
agreement with the Department to perform specific tasks, or by
an Eligible Developer or an Eligible Employer through a
development agreement. All Eligible Projects are subject to
review and approval by the Managing Partner and by the
Department. The life span of the Fund may be extended past 2036
2026 by law.
(Source: P.A. 101-275, eff. 8-9-19.)

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Section 15. The New Markets Development Program Act is
amended by changing Sections 25, 45, and 50 as follows:
(20 ILCS 663/25)
Sec. 25. Certification of qualified equity investments.
(a) A qualified community development entity that seeks to
have an equity investment or long-term debt security
designated as a qualified equity investment and eligible for
tax credits under this Section shall apply to the Department.
The qualified community development entity must submit an
application on a form that the Department provides that
includes:
(1) The name, address, tax identification number of
the entity, and evidence of the entity's certification as
a qualified community development entity.
(2) A copy of the allocation agreement executed by the
entity, or its controlling entity, and the Community
Development Financial Institutions Fund.
(3) A certificate executed by an executive officer of
the entity attesting that the allocation agreement remains
in effect and has not been revoked or cancelled by the
Community Development Financial Institutions Fund.
(4) A description of the proposed amount, structure,
and purchaser of the equity investment or long-term debt
security.

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(5) The name and tax identification number of any
taxpayer eligible to utilize tax credits earned as a
result of the issuance of the qualified equity investment.
(6) Information regarding the proposed use of proceeds
from the issuance of the qualified equity investment.
(7) A nonrefundable application fee of $5,000. This
fee shall be paid to the Department and shall be required
of each application submitted.
(8) With respect to qualified equity investments made
on or after January 1, 2017, the amount of qualified
equity investment authority the applicant agrees to
designate as a federal qualified equity investment under
Section 45D of the Internal Revenue Code, including a copy
of the screen shot from the Community Development
Financial Institutions Fund's Allocation Tracking System
of the applicant's remaining federal qualified equity
investment authority.
(b) (Blank). Within 30 days after receipt of a completed
application containing the information necessary for the
Department to certify a potential qualified equity investment,
including the payment of the application fee, the Department
shall grant or deny the application in full or in part. If the
Department denies any part of the application, it shall inform
the qualified community development entity of the grounds for
the denial. If the qualified community development entity
provides any additional information required by the Department

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or otherwise completes its application within 15 days of the
notice of denial, the application shall be considered
completed as of the original date of submission. If the
qualified community development entity fails to provide the
information or complete its application within the 15-day
period, the application remains denied and must be resubmitted
in full with a new submission date.
(c) (Blank). If the application is deemed complete, the
Department shall certify the proposed equity investment or
long-term debt security as a qualified equity investment that
is eligible for tax credits under this Section, subject to the
limitations contained in Section 20. The Department shall
provide written notice of the certification to the qualified
community development entity. The notice shall include the
names of those taxpayers who are eligible to utilize the
credits and their respective credit amounts. If the names of
the taxpayers who are eligible to utilize the credits change
due to a transfer of a qualified equity investment or a change
in an allocation pursuant to Section 15, the qualified
community development entity shall notify the Department of
such change.
(d) (Blank). With respect to applications received before
January 1, 2017, the Department shall certify qualified equity
investments in the order applications are received by the
Department. Applications received on the same day shall be
deemed to have been received simultaneously. For applications

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received on the same day and deemed complete, the Department
shall certify, consistent with remaining tax credit capacity,
qualified equity investments in proportionate percentages
based upon the ratio of the amount of qualified equity
investment requested in an application to the total amount of
qualified equity investments requested in all applications
received on the same day.
(d-5) (Blank). With respect to applications received on or
after January 1, 2017, the Department shall certify
applications by applicants that agree to designate qualified
equity investments as federal qualified equity investments in
accordance with item (8) of subsection (a) of this Section in
proportionate percentages based upon the ratio of the amount
of qualified equity investments requested in an application to
be designated as federal qualified equity investments to the
total amount of qualified equity investments to be designated
as federal qualified equity investments requested in all
applications received on the same day.
(d-10) (Blank). With respect to applications received on
or after January 1, 2017, after complying with subsection
(d-5), the Department shall certify the qualified equity
investments of all other applicants, including the remaining
qualified equity investment authority requested by applicants
not designated as federal qualified equity investments in
accordance with item (8) of subsection (a) of this Section, in
proportionate percentages based upon the ratio of the amount

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of qualified equity investments requested in the applications
to the total amount of qualified equity investments requested
in all applications received on the same day.
(e) Once the Department has certified qualified equity
investments that, on a cumulative basis, are eligible for
$20,000,000 in tax credits, the Department may not certify any
more qualified equity investments. If a pending request cannot
be fully certified, the Department shall certify the portion
that may be certified unless the qualified community
development entity elects to withdraw its request rather than
receive partial credit.
(f) (Blank). Within 30 days after receiving notice of
certification, the qualified community development entity
shall (i) issue the qualified equity investment and receive
cash in the amount of the certified amount and (ii) with
respect to qualified equity investments made on or after
January 1, 2017, if applicable, designate the required amount
of qualified equity investment authority as a federal
qualified equity investment. The qualified community
development entity must provide the Department with evidence
of the receipt of the cash investment within 10 business days
after receipt and, with respect to qualified equity
investments made on or after January 1, 2017, if applicable,
provide evidence that the required amount of qualified equity
investment authority was designated as a federal qualified
equity investment. If the qualified community development

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entity does not receive the cash investment and issue the
qualified equity investment within 30 days following receipt
of the certification notice, the certification shall lapse and
the entity may not issue the qualified equity investment
without reapplying to the Department for certification. A
certification that lapses reverts back to the Department and
may be reissued only in accordance with the application
process outline in this Section 25.
(g) Allocation rounds enabled by this Act shall be applied
for according to the following schedule:
(1) (blank); on January 2, 2019, $125,000,000 of
qualified equity investments; and
(2) not less than 45 days after but not more than 90
days after the Community Development Financial
Institutions Fund of the United States Department of the
Treasury announces allocation awards under a Notice of
Funding Availability that is published in the Federal
Register on after September 6, 2019, $125,000,000 of
qualified equity investments; and .
(3) for any round occurring after January 1, 2022, at
times published on the Department's website.
(Source: P.A. 100-408, eff. 8-25-17; 101-604, eff. 12-13-19.)
(20 ILCS 663/45)
Sec. 45. Examination and Rulemaking.
(a) The Department may conduct examinations to verify that

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the tax credits under this Act have been received and applied
according to the requirements of this Act and to verify that no
event has occurred that would result in a recapture of tax
credits under Section 40.
(b) The Neither the Department and nor the Department of
Revenue shall have the authority to adopt promulgate rules
under the Act, including, but not limited to, the areas of
eligibility criteria, application review, award procedures,
and prohibited activities and interests. Rules relating to
eligibility may include criteria that prioritize investments
in targeted industries or that are likely to increase local
employment. but the Department and the Department of Revenue
shall have the authority to issue advisory letters to
individual qualified community development entities and their
investors that are limited to the specific facts outlined in
an advisory letter request from a qualified community
development entity. Such rulings cannot be relied upon by any
person or entity other than the qualified community
development entity that requested the letter and the taxpayers
that are entitled to any tax credits generated from
investments in such entity. For purposes of this subsection,
"rules" is given the meaning contained in Section 1-70 of the
Illinois Administrative Procedure Act.
(c) (Blank). In rendering advisory letters and making
other determinations under this Act, to the extent applicable,
the Department and the Department of Revenue shall look for

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guidance to Section 45D of the Internal Revenue Code of 1986,
as amended, and the rules and regulations issued thereunder.
(Source: P.A. 95-1024, eff. 12-31-08.)
(20 ILCS 663/50)
Sec. 50. Sunset. For fiscal years following fiscal year
2026 2021, qualified equity investments shall not be made
under this Act unless reauthorization is made pursuant to this
Section. For all fiscal years following fiscal year 2026 2021,
unless the General Assembly adopts a joint resolution granting
authority to the Department to approve qualified equity
investments for the Illinois new markets development program
and clearly describing the amount of tax credits available for
the next fiscal year, or otherwise complies with the
provisions of this Section, no qualified equity investments
may be permitted to be made under this Act. The amount of
available tax credits contained in such a resolution shall not
exceed the limitation provided under Section 20. Nothing in
this Section precludes a taxpayer who makes a qualified equity
investment prior to the expiration of authority to make
qualified equity investments from claiming tax credits
relating to that qualified equity investment for each
applicable credit allowance date.
(Source: P.A. 100-408, eff. 8-25-17.)
Section 99. Effective date. This Act takes effect upon
becoming law.