Bill Text: IL HB0197 | 2013-2014 | 98th General Assembly | Engrossed

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Amends the Tax Increment Allocation Redevelopment Act in the Illinois Municipal Code. Provides that 3 years after a redevelopment project area is established, the portion of taxes levied by a school district located in the redevelopment project area shall be allocated and paid to the school district in the manner required by law in the absence of the adoption of tax increment allocation financing.

Spectrum: Slight Partisan Bill (Democrat 2-1)

Status: (Failed) 2014-12-03 - Session Sine Die [HB0197 Detail]

Download: Illinois-2013-HB0197-Engrossed.html

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AN ACT concerning local government.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Municipal Code is amended by
changing Section 11-74.4-8 as follows:
(65 ILCS 5/11-74.4-8) (from Ch. 24, par. 11-74.4-8)
Sec. 11-74.4-8. Tax increment allocation financing. A
municipality may not adopt tax increment financing in a
redevelopment project area after the effective date of this
amendatory Act of 1997 that will encompass an area that is
currently included in an enterprise zone created under the
Illinois Enterprise Zone Act unless that municipality,
pursuant to Section 5.4 of the Illinois Enterprise Zone Act,
amends the enterprise zone designating ordinance to limit the
eligibility for tax abatements as provided in Section 5.4.1 of
the Illinois Enterprise Zone Act. A municipality, at the time a
redevelopment project area is designated, may adopt tax
increment allocation financing by passing an ordinance
providing that the ad valorem taxes, if any, arising from the
levies upon taxable real property in such redevelopment project
area by taxing districts and tax rates determined in the manner
provided in paragraph (c) of Section 11-74.4-9 each year after
the effective date of the ordinance until redevelopment project

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costs and all municipal obligations financing redevelopment
project costs incurred under this Division have been paid shall
be divided as follows:
(a) That portion of taxes levied upon each taxable lot,
block, tract or parcel of real property which is attributable
to the lower of the current equalized assessed value or the
initial equalized assessed value of each such taxable lot,
block, tract or parcel of real property in the redevelopment
project area shall be allocated to and when collected shall be
paid by the county collector to the respective affected taxing
districts in the manner required by law in the absence of the
adoption of tax increment allocation financing.
(a-5) Beginning with the first distribution of tax proceeds
to occur 3 years after the redevelopment project area is
established, that portion of taxes levied upon each taxable
lot, block, tract, or parcel of real property which is
attributable to annual inflationary increases (not less than
zero) shall be allocated to a school district located in the
redevelopment project area through an intergovernmental
agreement with the sponsoring municipality and, when
collected, shall be paid by the county collector to the school
district in the manner required by law. The inflationary
increase allocated to the school districts shall be determined
by the annual increase in the consumer price index-u.
For purposes of this subsection, "consumer price index-u"
means the index published by the Bureau of Labor Statistics of

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the United States Department of Labor that measures the average
change in prices of goods and services published by all urban
consumers, United States city average, all items, 1982-1984 =
100.
(b) Except from a tax levied by a township to retire bonds
issued to satisfy court-ordered damages, that portion, if any,
of such taxes which is attributable to the increase in the
current equalized assessed valuation of each taxable lot,
block, tract or parcel of real property in the redevelopment
project area over and above the initial equalized assessed
value of each property in the project area shall be allocated
to and when collected shall be paid to the municipal treasurer
who shall deposit said taxes into a special fund called the
special tax allocation fund of the municipality for the purpose
of paying redevelopment project costs and obligations incurred
in the payment thereof. In any county with a population of
3,000,000 or more that has adopted a procedure for collecting
taxes that provides for one or more of the installments of the
taxes to be billed and collected on an estimated basis, the
municipal treasurer shall be paid for deposit in the special
tax allocation fund of the municipality, from the taxes
collected from estimated bills issued for property in the
redevelopment project area, the difference between the amount
actually collected from each taxable lot, block, tract, or
parcel of real property within the redevelopment project area
and an amount determined by multiplying the rate at which taxes

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were last extended against the taxable lot, block, track, or
parcel of real property in the manner provided in subsection
(c) of Section 11-74.4-9 by the initial equalized assessed
value of the property divided by the number of installments in
which real estate taxes are billed and collected within the
county; provided that the payments on or before December 31,
1999 to a municipal treasurer shall be made only if each of the
following conditions are met:
(1) The total equalized assessed value of the
redevelopment project area as last determined was not less
than 175% of the total initial equalized assessed value.
(2) Not more than 50% of the total equalized assessed
value of the redevelopment project area as last determined
is attributable to a piece of property assigned a single
real estate index number.
(3) The municipal clerk has certified to the county
clerk that the municipality has issued its obligations to
which there has been pledged the incremental property taxes
of the redevelopment project area or taxes levied and
collected on any or all property in the municipality or the
full faith and credit of the municipality to pay or secure
payment for all or a portion of the redevelopment project
costs. The certification shall be filed annually no later
than September 1 for the estimated taxes to be distributed
in the following year; however, for the year 1992 the
certification shall be made at any time on or before March

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31, 1992.
(4) The municipality has not requested that the total
initial equalized assessed value of real property be
adjusted as provided in subsection (b) of Section
11-74.4-9.
The conditions of paragraphs (1) through (4) do not apply
after December 31, 1999 to payments to a municipal treasurer
made by a county with 3,000,000 or more inhabitants that has
adopted an estimated billing procedure for collecting taxes. If
a county that has adopted the estimated billing procedure makes
an erroneous overpayment of tax revenue to the municipal
treasurer, then the county may seek a refund of that
overpayment. The county shall send the municipal treasurer a
notice of liability for the overpayment on or before the
mailing date of the next real estate tax bill within the
county. The refund shall be limited to the amount of the
overpayment.
It is the intent of this Division that after the effective
date of this amendatory Act of 1988 a municipality's own ad
valorem tax arising from levies on taxable real property be
included in the determination of incremental revenue in the
manner provided in paragraph (c) of Section 11-74.4-9. If the
municipality does not extend such a tax, it shall annually
deposit in the municipality's Special Tax Increment Fund an
amount equal to 10% of the total contributions to the fund from
all other taxing districts in that year. The annual 10% deposit

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required by this paragraph shall be limited to the actual
amount of municipally produced incremental tax revenues
available to the municipality from taxpayers located in the
redevelopment project area in that year if: (a) the plan for
the area restricts the use of the property primarily to
industrial purposes, (b) the municipality establishing the
redevelopment project area is a home-rule community with a 1990
population of between 25,000 and 50,000, (c) the municipality
is wholly located within a county with a 1990 population of
over 750,000 and (d) the redevelopment project area was
established by the municipality prior to June 1, 1990. This
payment shall be in lieu of a contribution of ad valorem taxes
on real property. If no such payment is made, any redevelopment
project area of the municipality shall be dissolved.
If a municipality has adopted tax increment allocation
financing by ordinance and the County Clerk thereafter
certifies the "total initial equalized assessed value as
adjusted" of the taxable real property within such
redevelopment project area in the manner provided in paragraph
(b) of Section 11-74.4-9, each year after the date of the
certification of the total initial equalized assessed value as
adjusted until redevelopment project costs and all municipal
obligations financing redevelopment project costs have been
paid the ad valorem taxes, if any, arising from the levies upon
the taxable real property in such redevelopment project area by
taxing districts and tax rates determined in the manner

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provided in paragraph (c) of Section 11-74.4-9 shall be divided
as follows:
(1) That portion of the taxes levied upon each taxable
lot, block, tract or parcel of real property which is
attributable to the lower of the current equalized assessed
value or "current equalized assessed value as adjusted" or
the initial equalized assessed value of each such taxable
lot, block, tract, or parcel of real property existing at
the time tax increment financing was adopted, minus the
total current homestead exemptions under Article 15 of the
Property Tax Code in the redevelopment project area shall
be allocated to and when collected shall be paid by the
county collector to the respective affected taxing
districts in the manner required by law in the absence of
the adoption of tax increment allocation financing.
(2) That portion, if any, of such taxes which is
attributable to the increase in the current equalized
assessed valuation of each taxable lot, block, tract, or
parcel of real property in the redevelopment project area,
over and above the initial equalized assessed value of each
property existing at the time tax increment financing was
adopted, minus the total current homestead exemptions
pertaining to each piece of property provided by Article 15
of the Property Tax Code in the redevelopment project area,
shall be allocated to and when collected shall be paid to
the municipal Treasurer, who shall deposit said taxes into

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a special fund called the special tax allocation fund of
the municipality for the purpose of paying redevelopment
project costs and obligations incurred in the payment
thereof.
The municipality may pledge in the ordinance the funds in
and to be deposited in the special tax allocation fund for the
payment of such costs and obligations. No part of the current
equalized assessed valuation of each property in the
redevelopment project area attributable to any increase above
the total initial equalized assessed value, or the total
initial equalized assessed value as adjusted, of such
properties shall be used in calculating the general State
school aid formula, provided for in Section 18-8 of the School
Code, until such time as all redevelopment project costs have
been paid as provided for in this Section.
Whenever a municipality issues bonds for the purpose of
financing redevelopment project costs, such municipality may
provide by ordinance for the appointment of a trustee, which
may be any trust company within the State, and for the
establishment of such funds or accounts to be maintained by
such trustee as the municipality shall deem necessary to
provide for the security and payment of the bonds. If such
municipality provides for the appointment of a trustee, such
trustee shall be considered the assignee of any payments
assigned by the municipality pursuant to such ordinance and
this Section. Any amounts paid to such trustee as assignee

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shall be deposited in the funds or accounts established
pursuant to such trust agreement, and shall be held by such
trustee in trust for the benefit of the holders of the bonds,
and such holders shall have a lien on and a security interest
in such funds or accounts so long as the bonds remain
outstanding and unpaid. Upon retirement of the bonds, the
trustee shall pay over any excess amounts held to the
municipality for deposit in the special tax allocation fund.
When such redevelopment projects costs, including without
limitation all municipal obligations financing redevelopment
project costs incurred under this Division, have been paid, all
surplus funds then remaining in the special tax allocation fund
shall be distributed by being paid by the municipal treasurer
to the Department of Revenue, the municipality and the county
collector; first to the Department of Revenue and the
municipality in direct proportion to the tax incremental
revenue received from the State and the municipality, but not
to exceed the total incremental revenue received from the State
or the municipality less any annual surplus distribution of
incremental revenue previously made; with any remaining funds
to be paid to the County Collector who shall immediately
thereafter pay said funds to the taxing districts in the
redevelopment project area in the same manner and proportion as
the most recent distribution by the county collector to the
affected districts of real property taxes from real property in
the redevelopment project area.

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Upon the payment of all redevelopment project costs, the
retirement of obligations, the distribution of any excess
monies pursuant to this Section, and final closing of the books
and records of the redevelopment project area, the municipality
shall adopt an ordinance dissolving the special tax allocation
fund for the redevelopment project area and terminating the
designation of the redevelopment project area as a
redevelopment project area. Title to real or personal property
and public improvements acquired by or for the municipality as
a result of the redevelopment project and plan shall vest in
the municipality when acquired and shall continue to be held by
the municipality after the redevelopment project area has been
terminated. Municipalities shall notify affected taxing
districts prior to November 1 if the redevelopment project area
is to be terminated by December 31 of that same year. If a
municipality extends estimated dates of completion of a
redevelopment project and retirement of obligations to finance
a redevelopment project, as allowed by this amendatory Act of
1993, that extension shall not extend the property tax
increment allocation financing authorized by this Section.
Thereafter the rates of the taxing districts shall be extended
and taxes levied, collected and distributed in the manner
applicable in the absence of the adoption of tax increment
allocation financing.
Nothing in this Section shall be construed as relieving
property in such redevelopment project areas from being

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assessed as provided in the Property Tax Code or as relieving
owners of such property from paying a uniform rate of taxes, as
required by Section 4 of Article IX 9 of the Illinois
Constitution.
(Source: P.A. 95-644, eff. 10-12-07; revised 10-17-12.)