Bill Text: IL HB3152 | 2023-2024 | 103rd General Assembly | Introduced

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Bill Title: Creates the Home Buyer Savings Account Act. Sets forth provisions concerning legislative findings; establishment of first-time and second-chance home buyer savings accounts; use of first-time and second-chance home buyer savings accounts; account holder responsibilities; responsibilities of financial institutions; deduction of contributions, exclusion of earnings, and limitations; penalty for withdrawal; Department of Revenue forms; and an annual report. Defines terms. Amends the Illinois Municipal Code. Sets forth provisions concerning accessory dwelling units and housing. Amends the Reimagining Electric Vehicles in Illinois Act. Provides that the Department of Commerce and Economic Opportunity shall establish a pilot grant program to encourage the construction and rehabilitation of housing located near a REV Illinois Project. Amends the Illinois Highway Code. Sets forth provisions concerning units of local government which have in effect an impact fee ordinance or resolution. Makes other changes.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2023-03-27 - Rule 19(a) / Re-referred to Rules Committee [HB3152 Detail]

Download: Illinois-2023-HB3152-Introduced.html

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103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB3152 Introduced , by Rep. Marcus C. Evans, Jr. SYNOPSIS AS INTRODUCED:
New Act
65 ILCS 5/11-13-28 new
65 ILCS 5/11-13-29 new
20 ILCS 686/110 new
605 ILCS 5/5-907 from Ch. 121, par. 5-907
605 ILCS 5/5-918 from Ch. 121, par. 5-918
605 ILCS 5/5-918.1 new
Creates the Home Buyer Savings Account Act. Sets forth provisions concerning legislative findings; establishment of first-time and second-chance home buyer savings accounts; use of first-time and second-chance home buyer savings accounts; account holder responsibilities; responsibilities of financial institutions; deduction of contributions, exclusion of earnings, and limitations; penalty for withdrawal; Department of Revenue forms; and an annual report. Defines terms. Amends the Illinois Municipal Code. Sets forth provisions concerning accessory dwelling units and housing. Amends the Reimagining Electric Vehicles in Illinois Act. Provides that the Department of Commerce and Economic Opportunity shall establish a pilot grant program to encourage the construction and rehabilitation of housing located near a REV Illinois Project. Amends the Illinois Highway Code. Sets forth provisions concerning units of local government which have in effect an impact fee ordinance or resolution. Makes other changes.
LRB103 25769 HLH 52118 b
A BILL FOR
HB3152 LRB103 25769 HLH 52118 b
AN ACT concerning local government.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Article 5.
Section 5-1. Short title. This Act may be cited as the Home
Buyer Savings Accounts Act.
Section 5-5. Legislative findings. The General Assembly
finds and recognizes that the American Dream has always been
closely associated with owning your own home. However, for
many reasons, it is becoming more and more difficult to
achieve the goal of homeownership in Illinois and throughout
the country. The General Assembly finds and recognizes that
homeownership provides more than a dream to an individual
person or family, but that an increase in homeownership rates
in Illinois has a direct impact on the quality of our
communities and schools, economic and education opportunities,
and safe streets. The General Assembly is intent on finding
methods to make it easier for those in Illinois to achieve
their goal of homeownership for the first time. It is the
General Assembly's intent with this Act to provide a
tax-incentivized savings account for qualified first-time and
certain second-chance home buyers, which in turn can be used

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toward a down payment or certain eligible closing costs for
the purchase of a home in Illinois.
Section 5-10. Definitions. In this Act:
"Account holder" means a first-time and second-chance home
buyer who establishes, individually or jointly with another
first-time and second-chance home buyer, a first-time and
second-chance home buyer savings account.
"Allowable closing costs" means a disbursement listed on a
settlement statement for the purchase of a single-family
residence in Illinois by a first-time and second-chance home
buyer.
"Department" means the Department of Revenue.
"Eligible costs" means the down payment and allowable
closing costs for the purchase of a single-family residence in
Illinois by a first-time and second-chance home buyer.
Eligible costs do not include any costs incurred prior to the
establishment of a first-time and second-chance home buyer
savings account.
"Financial institution" means any bank, savings
institution, industrial loan association, credit union, or
other similar entity authorized to do business and accept
deposits in Illinois.
"First-time and second-chance home buyer" means an
individual who resides in Illinois and has not owned or
purchased, either individually or jointly, a single-family

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residence during a period of ten years prior to the date of the
purchase of a single-family residence.
"First-time and second-chance home buyer savings account"
or "account" means an account with a financial institution
created for the purpose of payment or reimbursement of
eligible costs for the purchase of a single-family residence
in Illinois by a first-time and second-chance home buyer and
designated by the financial institution upon its creation as a
first-time and second-chance home buyer savings account.
"Settlement statement" means the statement of receipts and
disbursements for a transaction related to real estate,
including a statement prescribed under the Real Estate
Settlement Procedures Act of 1974, 12 U.S.C. 2601 et seq., as
amended, and regulations thereunder.
"Single-family residence" means a single-family residence
owned and occupied by a first-time and second-chance home
buyer as the first-time and second-chance home buyer's
principal residence, which may also include a manufactured
home, trailer, mobile home, condominium unit, or cooperative.
Section 5-15. Establishment of first-time and
second-chance home buyer savings account. After the effective
date of this Act, a first-time and second-chance home buyer
may open an account with a financial institution designated in
its entirety by the financial institution as a first-time and
second-chance home buyer savings account.

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Section 5-20. Use of first-time and second-chance home
buyer savings account.
(a) Funds from a first-time and second-chance home buyer
savings account may be used only to pay a first-time and
second-chance home buyer's eligible costs for the purchase of
a single-family residence in Illinois.
(b) A first-time and second-chance home buyer may jointly
own a first-time and second-chance home buyer savings account
with another first-time and second-chance home buyer if the
joint account holders file a joint income tax return.
(c) Only cash and marketable securities may be contributed
to a first-time and second-chance home buyer savings account.
Subject to the limitations of Section 5-35, persons other than
the account holder may contribute funds to a first-time and
second-chance home buyer savings account. There is no
limitation on the amount of contributions that may be made to
or retained in a first-time and second-chance home buyer
savings account.
Section 5-25. Account holder responsibilities.
(a) The account holder shall do all the following:
(1) Not use funds held in a first-time and
second-chance home buyer savings account to pay expenses
of administering the account, except that a service or
other account fee may be deducted from the account by the

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financial institution in which the account is held.
(2) Submit the following to the Department of Revenue
with the account holder's Illinois income tax return:
(A) Detailed information, in a form prescribed by
the Department of Revenue, regarding the first-time
and second-chance home buyer savings account,
including a list of transactions for the account
during the tax year.
(B) Form 1099 issued by the financial institution
for the account.
(3) Submit to the Department, upon a withdrawal of
funds from a first-time and second-chance home buyer
savings account, a detailed account of the eligible costs
toward which the account funds were applied and a
statement of the amount of funds remaining in the account,
if any. If, upon withdrawal of funds from the first-time
and second-chance home buyer savings account, the account
holder fails to provide the Department with the detailed
account of the eligible costs towards which the account
funds were applied, the entire account's funds, including
the interest and other income on principal, shall be
subject to the penalties listed under Section 5-40.
(b) Failure to submit the documentation required under
subsection (a) on an annual basis with the filing of the
Illinois income tax return will result in the automatic denial
of the deduction and exclusion.

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Section 5-30. Responsibilities of financial institutions.
(a) A financial institution shall be required to do the
following:
(1) Create a new account for the first-time and
second-chance home buyer and designate the account as a
"first-time and second-chance home buyer's savings
account" on records and transactional statements related
to the account.
(2) Provide the account holder with a detailed account
statement relating to the first-time and second-chance
home buyer's savings account on a yearly basis.
(b) A financial institution shall not be required to do
any of the following:
(1) Track the use of money withdrawn from a first-time
and second-chance home buyer savings account.
(2) Allocate funds in a first-time and second-chance
home buyer savings account between joint account holders.
(3) Report any information not otherwise required by
law to the Department of Revenue or any other governmental
agency.
(c) A financial institution is not responsible or liable
for the following:
(1) Determining or ensuring that an account satisfies
the requirements to be a first-time and second-chance home
buyer savings account.

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(2) Determining or ensuring that funds in a first-time
and second-chance home buyer savings account are used for
eligible costs.
(3) Reporting or remitting taxes or penalties related
to the use of a first-time and second-chance home buyer
savings account.
(d) Upon being furnished proof of the death of the account
holder and any other information related to the death required
by the financial institution or contract governing the
first-time and second-chance home buyer savings account, a
financial institution shall distribute the principal and
accumulated interest or other income in the account in
accordance with the terms of the contract governing the
account or as otherwise required by law.
Section 5-35. Deduction of contributions, exclusion of
earnings, and limitations.
(a) Except as otherwise provided in this Act and subject
to the limitations under this Section, a first-time and
second-chance home buyer savings account holder shall be
entitled to a state tax deduction, subject to the limitations
of this Section, not to exceed $5,000 for an account holder who
files an individual tax return or $10,000 for joint account
holders who file a joint tax return, for contributions made by
the account holder to a first-time and second-chance home
buyer savings account during the tax year in which the

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deduction is claimed.
(b) Except as otherwise provided in this Act and subject
to the limitations under this Section, earnings from the
first-time and second-chance home buyer savings account,
including interest and other income on the principal, shall be
excluded from taxable income of an account holder for Illinois
income tax purposes during the tax year.
(c) An account holder may claim the deduction and
exclusion under this Section as follows:
(1) For a period not to exceed 10 years.
(2) For an aggregate total amount of principal and
earnings not to exceed $25,000 for individual accounts and
$50,000 for joint accounts during the 10-year period.
(3) Only if the principal and earnings of the account
remain in the account until a withdrawal is made for
eligible costs related to the purchase of a single-family
residence by a first-time and second-chance home buyer.
(d) A person other than the account holder who deposits
funds in a first-time and second-chance home buyer savings
account shall not be entitled to the deduction and exclusion
provided under this Act.
(e) The deduction and exclusion from taxable income
provided by this Act shall apply to any alternative basis for
calculating taxable income for Illinois income tax purposes.
(f) The funds in the first-time and second-chance home
buyer savings account shall not be used to purchase a

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single-family residence outside of this State.
Section 5-40. Penalty for withdrawal for purpose other
than eligible costs. Except as otherwise provided in this
Section, if the account holder withdraws any funds from a
first-time and second-chance home buyer savings account for a
purpose other than eligible costs for the purchase of a
single-family residence in this State, the following shall
apply:
(1) The entire balance of the fund, including interest and
other income on principal, shall be included in the account
holder's taxable income for the tax year in which the
withdrawal was made.
(2) The account holder shall pay a penalty to the
Department of Revenue equal to 10% of the amount withdrawn.
The penalty shall not apply to funds withdrawn from an account
which were:
(A) Withdrawn by reason of the account holder's death
or disability or due to unemployment after the account
holder has exhausted his or her applicable unemployment
compensation benefits.
(B) A disbursement of assets of the account pursuant
to a filing for protection under the United States
Bankruptcy Code.
(3) Paragraphs (1) and (2) do not apply to funds withdrawn
or distributed from a first-time and second-chance home buyer

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savings account that within 60 days of their withdrawal or
distribution are deposited in full into another first-time and
second-chance home buyer savings account. This paragraph shall
apply both to transfers between any qualifying first-time and
second-chance home buyer savings accounts whether such
transfers are to or from qualifying individual or joint
accounts.
Section 5-45. Department; forms. The Department of Revenue
shall adopt forms for the following:
(1) The designation of an account with a financial
institution to serve as a first-time and second-chance home
buyer savings account.
(2) An account holder to annually submit to the Department
of Revenue detailed information regarding the first-time and
second-chance home buyer savings account, including, but not
limited to, a list of transactions for the account during the
tax year and identifying any supporting documentation required
to be maintained by the account holder.
Section 5-50. Annual report. The Department shall submit
an annual report to the General Assembly no later than March 31
of each calendar year with the first annual report due no later
than March 31, 2024, in which the Department shall include the
total annual number of deductions claimed and the total amount
of deposits deducted pursuant to this Act, the number of

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taxpayers who submitted an account to the Department pursuant
to paragraph (3) of subsection (a) of Section 5-25, and the
number of taxpayers who were subjected to the penalty
provisions of Section 5-40.
Article 10.
Section 10-5. The Illinois Municipal Code is amended by
adding Sections 11-13-28 and 11-13-29 as follows:
(65 ILCS 5/11-13-28 new)
Sec. 11-13-28. Accessory dwelling units.
(a) As used in this Section:
"Accessory dwelling unit" means an attached or a detached
residential dwelling unit that provides complete independent
living facilities for one or more persons and is located on a
lot with a proposed or existing primary residence and that
includes permanent provisions for living, sleeping, eating,
cooking, and sanitation on the same parcel as the
single-family or multifamily dwelling upon which it is or will
be situated. "Accessory dwelling unit" includes, but is not
limited to:
(1) An efficiency unit.
(2) A manufactured home, as that term is defined in
paragraph (53) of subsection (a) of Section 9-102 of the
Uniform Commercial Code.

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"Efficiency unit" means a unit for occupancy by no more
than 2 persons that has a minimum floor area of 150 square feet
and that may also have a partial kitchen or bathroom
facilities.
(b) A unit of local government, as defined in Section 1 of
Article VII of the Illinois Constitution, may not prohibit the
building or usage of accessory dwelling units in the unit of
local government.
(c) A unit of local government may provide reasonable
regulations relating to the size and location of accessory
dwelling units similar to other accessory structures, unless a
regulation would have the effect of prohibiting accessory
dwelling units.
(d) A home rule unit may not regulate accessory dwelling
units in a manner inconsistent with this Section. This Section
is a limitation under subsection (i) of Section 6 of Article
VII of the Illinois Constitution on the concurrent exercise by
home rule units of powers and functions exercised by the
State.
(65 ILCS 5/11-13-29 new)
Sec. 11-13-29. Provisions related to housing.
(a) As used in this Section:
"Cottage clusters" means groupings of no fewer than 4
detached housing units per acre with a footprint of no less
than 900 and no more than 1500 square feet each and that

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include a common courtyard.
"Middle housing" means:
(A) duplexes;
(B) triplexes;
(C) quadplexes;
(D) cottage clusters; and
(E) townhouses.
"Townhouses" means a dwelling unit constructed in a row of 2 or
more attached units, where each dwelling unit is located on an
individual lot or parcel and shares at least one common wall
with an adjacent unit.
(b) Except as provided in subsection (d), each city with a
population of 25,000 or more shall allow the development of:
(1) all middle housing types in areas zoned for
residential use that allow for the development of detached
single-family dwellings; and
(2) a duplex on each lot or parcel zoned for
residential use that allows for the development of
detached single-family dwellings.
(c) Except as provided in subsection (d), each city with a
population of more than 10,000 and less than 25,000 shall
allow the development of a duplex on each lot or parcel zoned
for residential use that allows for the development of
detached single-family dwellings. Nothing in this subsection
prohibits a local government from allowing middle housing
types in addition to duplexes.

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(d) This Section does not apply to:
(1) cities with a population of 10,000 or fewer; and
(2) unincorporated lands adjacent to or adjoining
incorporated city boundaries.
(e) Local governments may regulate siting and design of
middle housing required to be permitted under this Section, if
the regulations do not, individually or cumulatively,
discourage the development of all middle housing types
permitted in the area through unreasonable costs or delay.
Local governments may regulate middle housing to comply with
protective measures adopted pursuant to statewide land use
planning goals.
(f) This Section does not prohibit local governments from
permitting:
(1) single-family dwellings in areas zoned to allow
for single-family dwellings; or
(2) middle housing in areas not required under this
Section.
(g) A home rule unit may not regulate housing developments
in a manner inconsistent with this Section. This Section is a
limitation under subsection (i) of Section 6 of Article VII of
the Illinois Constitution on the concurrent exercise by home
rule units of powers and functions exercised by the State.
Article 15.

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Section 15-5. The Reimagining Electric Vehicles in
Illinois Act is amended by adding Section 110 as follows:
(20 ILCS 686/110 new)
Sec. 110. Electric Vehicle Oriented (EVO) Housing Pilot
Program.
(a) The inventory of available homes for sale in Illinois
has been in continuous decline for multiple years. The lack of
inventory contributes directly to affordability, making it
more difficult to purchase a home, even for those individuals
who have incomes at or close to the median income of the area
in which they live. This problem is especially frustrating
where a potential REV Illinois Project faces the prospect of
little to no housing options for the employees of that
project. The General Assembly intends to authorize the
creation of a pilot grant program for electric vehicle
oriented (EVO) housing, with the goal of incentivizing the
construction of new homes near REV Illinois Projects.
(b) Subject to appropriation, the Department shall
establish a pilot grant program to encourage the construction
and rehabilitation of housing located near a REV Illinois
Project. Funding may be used for the acquisition,
construction, development, predevelopment, or rehabilitation
of a qualified development as provided in subsection (d).
(c) "Qualified development" means a project that (i) is
geographically located within 10 miles of a REV Illinois

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Project, (ii) involves the new construction of 2 or more
single-family homes, including detached homes, attached
duplex, triplex or fourplex homes, and condominiums, and (iii)
results in the construction of homes that, according to the
federal Department of Housing and Urban Development, are
affordable for either home ownership or rental and that are
occupied, reserved, or marketed for occupancy by households
with a gross household income that is greater than 80% but less
than 120% of the area median household income.
(d) The EVO housing pilot grant program shall provide for
grants of up to 10% of the land acquisition costs and 15% of
the construction, development, predevelopment, or
rehabilitation costs of a qualified development.
(e) Project sponsors who wish to participate in the EVO
housing pilot grant program shall submit a grant application
to the Department in accordance with rules adopted by the
Department.
(f) No application for the EVO Housing Grant Pilot Program
shall be accepted by the Department after December 31, 2026.
Article 20.
Section 20-5. The Illinois Highway Code is amended by
changing Sections 5-907 and 5-918 and by adding Section
5-918.1 as follows:

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(605 ILCS 5/5-907) (from Ch. 121, par. 5-907)
Sec. 5-907. Advisory Committee. A road improvement impact
fee advisory committee shall be created by the unit of local
government intending to impose impact fees. The Advisory
Committee shall consist of not less than 10 members and not
more than 20 members. Not less than 40% of the members of the
committee shall be representatives of the real estate,
development, and building industries and the labor communities
and may not be employees or officials of the unit of local
government.
(a) The members of the Advisory Committee shall be
selected as follows:
(1) The representatives of real estate shall be
licensed under the Real Estate License Act of 2000 and
shall be designated by the President of the Illinois
Association of Realtors from a local Board from the
service area or areas of the unit of local government.
(2) The representatives of the development industry
shall be designated by the Regional Developers
Association.
(3) The representatives of the building industry shall
be designated representatives of the Regional Home
Builders representing the unit of local government's
geographic area as appointed from time to time by that
Association's president.
(4) The labor representatives shall be chosen by

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either the Central Labor Council or the Building and
Construction Trades Council having jurisdiction within the
unit of local government.
(b) If the unit of local government is a county, at least
30% of the members serving on the commission must be
representatives of the municipalities within the county. The
municipal representatives shall be selected by a convention of
mayors in the county, who shall elect from their membership
municipal representatives to serve on the Advisory Committee.
The members representing the county shall be appointed by the
chief executive officer of the county.
(c) If the unit of local government is a municipality, the
non-public representatives shall be appointed by the chief
executive officer of the municipality.
(d) Each unit of local government that imposes or intends
to impose impact fees and that has created an Advisory
Committee shall publish the names of the Advisory Committee
members on the public website maintained by the unit of local
government, together with a list of the dates and times at
which the Advisory Committee has met, and shall provide an
electronically accessible copy of the minutes of any such
meetings.
If the unit of local government has a planning or zoning
commission, the unit of local government may elect to use its
planning or zoning commission to serve as the Advisory
Committee, provided that not less than 40% of the committee

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members include representatives of the real estate,
development, and building industries and the labor communities
who are not employees or officials of the unit of local
government. A unit of local government may appoint additional
members to serve on the planning or zoning commission as ad hoc
voting members whenever the planning or zoning commission
functions as the Advisory Committee; provided that no less
than 40% of the members include representatives of the real
estate, development, and building industries and the labor
communities.
(Source: P.A. 91-245, eff. 12-31-99.)
(605 ILCS 5/5-918) (from Ch. 121, par. 5-918)
Sec. 5-918. Transition Clauses.
(a) Conformance of Existing Ordinances. A unit of local
government which currently has in effect an impact fee
ordinance or resolution shall have not more than 12 months
from July 1, 2023 26, 1989 to bring its ordinance or resolution
into conformance with the requirements imposed by this Act,
except that a home rule unit of local government with a
population over 75,000 and located in a county with a
population over 600,000 and less than 2,000,000 shall have not
more than 18 months from July 1, 2023 26, 1989, to bring that
ordinance or resolution into conformance. As used in this
subsection, "conformance" includes conformance with Section
5-907.

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(b) Exemption of Developments Receiving Site Specific
Development Approval. No development which has received site
specific development approval from a unit of local government
within 18 months before the first date of publication by the
unit of local government of a notice of public hearing to
consider land use assumptions relating to the development of a
comprehensive road improvement plan and imposition of impact
fees and which has filed for building permits or certificates
of occupancy within 18 months of the date of approval of the
site specific development plan shall be required to pay impact
fees for permits or certificates of occupancy issued within
that 18 month period.
This Division shall have no effect on the validity of any
existing agreements entered into between a developer and a
unit of local government pertaining to fees, exactions or
donations made by a developer for the purpose of funding road
improvements.
(c) Exception to the Exemption of Developments Receiving
Site Specific Development Approval. Nothing in this Section
shall require the refund of impact fees previously collected
by units of local government in accordance with their
ordinances or resolutions, if such ordinances or resolutions
were adopted prior to the effective date of this Act and
provided that such impact fees are encumbered as provided in
Section 5-916.
(Source: P.A. 86-97; 86-1158.)

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(605 ILCS 5/5-918.1 new)
Sec. 5-918.1. Refund for non-compliance. Any unit of local
government that has in effect an impact fee ordinance or
resolution on the effective date of this amendatory Act of the
103rd General Assembly and that has not brought its impact fee
ordinance or resolution into compliance with this Section by
the date provided for in Section 5-918 shall refund all funds
previously collected under the impact fee ordinance or
resolution together with any interest earned on those funds.
Any impact fee ordinance or resolution that does not conform
with this Section by the date provided for in Section 5-918
shall be considered null and void.