HB3685 99TH GENERAL ASSEMBLY

LRB099 07978 HLH 28118 b

99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB3685

Introduced , by Rep. Litesa E. Wallace

SYNOPSIS AS INTRODUCED:

35 ILCS 5/224 new
35 ILCS 200/18-184.15 new

Amends the Property Tax Code. Provides that a taxing district may grant an abatement for property that contains an expanded business facility. Defines "expanded business facility" to include a requirement that the business must create a certain number of new employment positions at the facility. Contains provisions allowing for an enhanced abatement for certain facilities. Amends the Illinois Income Tax Act to create a credit equal to a percentage of the remaining tax liability for the property. Effective immediately.

FISCAL NOTE ACT MAY APPLY

HOUSING AFFORDABILITY IMPACT NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Income Tax Act is amended by adding Section 224 as follows:

(35 ILCS 5/224 new)

Sec. 224. Expanded business facility credit.

(a) Notwithstanding any other provision of law, for taxable years beginning on or after January 1, 2016, a taxpayer that receives an abatement under Section 18-184.15 of the Property Tax Code during the taxable year is entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 as provided in this Section. The amount of the credit shall be:

(1) for the first and second taxable years after the business facility qualifies as an expanded business facility under Section 18-184.15 of the Property Tax Code, an amount equal to 28% of the remaining property tax liability for the property where the expanded business facility is located;

(2) for the third and fourth taxable years after the business facility qualifies as an expanded business facility under Section 18-184.15 of the Property Tax Code, an amount equal to 21% of the remaining property tax liability for the property where the expanded business facility is located; and

(3) for the fifth and sixth taxable years after the business facility qualifies as an expanded business facility under Section 18-184.15 of the Property Tax Code, an amount equal to 14% of the remaining property tax liability for the property where the expanded business facility is located.

(b) For partners, shareholders of Subchapter S corporations, and owners of limited liability companies, if the liability company is treated as a partnership for purposes of federal and State income taxation, the amount of the credit shall be determined in accordance with the determination of income and distributive share of income under Sections 702 and 704 and Subchapter S of the Internal Revenue Code.

(c) In no event shall a credit under this Section reduce the taxpayer's liability to less than zero. If the amount of the credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit year. The tax credit shall be applied to the earliest year for which there is a tax liability. If there are credits for more than one year that are available to offset a liability, the earlier credit shall be applied first.

(d) This Section is exempt from the provisions of Section 250.

Section 10. The Property Tax Code is amended by adding Section 18-184.15 as follows:

(35 ILCS 200/18-184.15 new)

Sec. 18-184.15. Business facility abatement.

(a) Each taxing district may, by a majority vote of its governing authority, order the county clerk to abate a portion of its taxes, as provided in subsection (b), on property that contains an expanded business facility.

(b) The amount of the abatement shall be as follows:

(1) for the first and second taxable years after the business facility qualifies as an expanded business facility, the amount of the abatement shall be 52% of its property tax liability for the applicable taxing district;

(2) for the third and fourth taxable years after the business facility qualifies as an expanded business facility, the amount of the abatement shall be 39% of its property tax liability for the applicable taxing district;

(3) for the fifth and sixth taxable years after the business facility qualifies as an expanded business facility, the amount of the abatement shall be 26% of its property tax liability for the applicable taxing district; and

(4) no such abatement may be granted for the seventh taxable year after the expanded business facility qualifies as an expanded business facility or thereafter.

An expanded business facility is eligible for an enhanced abatement of 58.5% of its property tax liability for the applicable taxing district in the first 12 years after the expanded business facility qualifies as an expanded business facility if:

(1) in counties with fewer than 3,000,000 inhabitants, the expanded business facility is at least 250,000 square feet and (i) the business retains at least 2,500 employees and creates at least 500 new positions at the business facility, and the salary for those new and retained positions is at least 150% of the minimum wage for the geographic area where the business facility is located or (ii) the business creates at least 1,250 new positions at the business facility, and the salary for those positions is at least 150% of the minimum wage for the geographic area where the business facility is located; and

(2) in counties with 3,000,000 or more inhabitants, (i) the expanded business facility is at least 700,000 square feet; (ii) the business spends at least $150,000,000 to purchase, construct, or lease the facility; (iii) at least 1,100 individuals are employed at the facility, including at least 500 new positions; (iv) all of those individuals are eligible for employer-subsidized health care benefits and are paid at least 150% of the minimum wage for the geographic area where the business facility is located.

(c) For the purposes of this Section:

"Expanded business facility" means a business facility of at least 5,000 square feet at which:

(1) in a county with fewer than 100,000 inhabitants, at least 10 new positions are created and filled; and

(2) in a county with 100,000 or more inhabitants, at least 25 new positions are created and filled.

"Full-time" means that the individual is employed for consideration for at least 35 hours each week or renders any other standard of service generally accepted by industry custom or practice as full-time employment.

"New position" means an employment position that is in addition to the employer's previous head count at the prospective expanded business facility in the taxable year prior to the taxable year for which the abatement is granted and is:

(1) located in Illinois;

(2) part of the expanded business facility;

(3) permanent;

(4) filled for at least one year; and

(5) full-time of indefinite duration; provided that, in a county with at least 3,000,000 inhabitants, a contract position of definite duration lasting at least 12 months with an unlimited renewal option that otherwise meets the criteria set forth in items (1) through (4) may be considered a "new position".

Section 99. Effective date. This Act takes effect upon becoming law.