Bill Text: IL HB5362 | 2011-2012 | 97th General Assembly | Engrossed

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

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Bill Title: Amends the Illinois Municipal Code. Provides that the corporate authorities of a non-home rule municipality may use (now, until December 31, 2015) the proceeds of a tax imposed under the Non-Home Rule Municipal Retailers' Occupation Tax Act, Non-Home Rule Municipal Service Occupation Tax Act, or the Non-Home Rule Municipal Use Tax Act for expenditure on municipal operations, in addition to or in lieu of any expenditure on public infrastructure or for property tax relief. Effective immediately.

Spectrum: Bipartisan Bill

Status: (Passed) 2012-07-20 - Public Act . . . . . . . . . 97-0837 [HB5362 Detail]

Download: Illinois-2011-HB5362-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 Sections 8-11-1.3, 8-11-1.4, and 8-11-1.5 as follows:
(65 ILCS 5/8-11-1.3) (from Ch. 24, par. 8-11-1.3)
Sec. 8-11-1.3. Non-Home Rule Municipal Retailers'
Occupation Tax Act. The corporate authorities of a non-home
rule municipality may impose a tax upon all persons engaged in
the business of selling tangible personal property, other than
on an item of tangible personal property which is titled and
registered by an agency of this State's Government, at retail
in the municipality for expenditure on public infrastructure or
for property tax relief or both as defined in Section 8-11-1.2
if approved by referendum as provided in Section 8-11-1.1, of
the gross receipts from such sales made in the course of such
business. If the tax is approved by referendum on or after July
14, 2010 (the effective date of Public Act 96-1057), the
corporate authorities of a non-home rule municipality may,
until December 31, 2020 December 31, 2015, use the proceeds of
the tax for expenditure on municipal operations, in addition to
or in lieu of any expenditure on public infrastructure or for
property tax relief. The tax imposed may not be more than 1%

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and may be imposed only in 1/4% increments. The tax may not be
imposed on the sale of food for human consumption that is to be
consumed off the premises where it is sold (other than
alcoholic beverages, soft drinks, and food that has been
prepared for immediate consumption) and prescription and
nonprescription medicines, drugs, medical appliances, and
insulin, urine testing materials, syringes, and needles used by
diabetics. The tax imposed by a municipality pursuant to this
Section and all civil penalties that may be assessed as an
incident thereof shall be collected and enforced by the State
Department of Revenue. The certificate of registration which is
issued by the Department to a retailer under the Retailers'
Occupation Tax Act shall permit such retailer to engage in a
business which is taxable under any ordinance or resolution
enacted pursuant to this Section without registering
separately with the Department under such ordinance or
resolution or under this Section. The Department shall have
full power to administer and enforce this Section; to collect
all taxes and penalties due hereunder; to dispose of taxes and
penalties so collected in the manner hereinafter provided, and
to determine all rights to credit memoranda, arising on account
of the erroneous payment of tax or penalty hereunder. In the
administration of, and compliance with, this Section, the
Department and persons who are subject to this Section shall
have the same rights, remedies, privileges, immunities, powers
and duties, and be subject to the same conditions,

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restrictions, limitations, penalties and definitions of terms,
and employ the same modes of procedure, as are prescribed in
Sections 1, 1a, 1a-1, 1d, 1e, 1f, 1i, 1j, 2 through 2-65 (in
respect to all provisions therein other than the State rate of
tax), 2c, 3 (except as to the disposition of taxes and
penalties collected), 4, 5, 5a, 5b, 5c, 5d, 5e, 5f, 5g, 5h, 5i,
5j, 5k, 5l, 6, 6a, 6b, 6c, 7, 8, 9, 10, 11, 12 and 13 of the
Retailers' Occupation Tax Act and Section 3-7 of the Uniform
Penalty and Interest Act as fully as if those provisions were
set forth herein.
No municipality may impose a tax under this Section unless
the municipality also imposes a tax at the same rate under
Section 8-11-1.4 of this Code.
Persons subject to any tax imposed pursuant to the
authority granted in this Section may reimburse themselves for
their seller's tax liability hereunder by separately stating
such tax as an additional charge, which charge may be stated in
combination, in a single amount, with State tax which sellers
are required to collect under the Use Tax Act, pursuant to such
bracket schedules as the Department may prescribe.
Whenever the Department determines that a refund should be
made under this Section to a claimant instead of issuing a
credit memorandum, the Department shall notify the State
Comptroller, who shall cause the order to be drawn for the
amount specified, and to the person named, in such notification
from the Department. Such refund shall be paid by the State

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Treasurer out of the non-home rule municipal retailers'
occupation tax fund.
The Department shall forthwith pay over to the State
Treasurer, ex officio, as trustee, all taxes and penalties
collected hereunder.
As soon as possible after the first day of each month,
beginning January 1, 2011, upon certification of the Department
of Revenue, the Comptroller shall order transferred, and the
Treasurer shall transfer, to the STAR Bonds Revenue Fund the
local sales tax increment, as defined in the Innovation
Development and Economy Act, collected under this Section
during the second preceding calendar month for sales within a
STAR bond district.
After the monthly transfer to the STAR Bonds Revenue Fund,
on or before the 25th day of each calendar month, the
Department shall prepare and certify to the Comptroller the
disbursement of stated sums of money to named municipalities,
the municipalities to be those from which retailers have paid
taxes or penalties hereunder to the Department during the
second preceding calendar month. The amount to be paid to each
municipality shall be the amount (not including credit
memoranda) collected hereunder during the second preceding
calendar month by the Department plus an amount the Department
determines is necessary to offset any amounts which were
erroneously paid to a different taxing body, and not including
an amount equal to the amount of refunds made during the second

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preceding calendar month by the Department on behalf of such
municipality, and not including any amount which the Department
determines is necessary to offset any amounts which were
payable to a different taxing body but were erroneously paid to
the municipality, and not including any amounts that are
transferred to the STAR Bonds Revenue Fund. Within 10 days
after receipt, by the Comptroller, of the disbursement
certification to the municipalities, provided for in this
Section to be given to the Comptroller by the Department, the
Comptroller shall cause the orders to be drawn for the
respective amounts in accordance with the directions contained
in such certification.
For the purpose of determining the local governmental unit
whose tax is applicable, a retail sale, by a producer of coal
or other mineral mined in Illinois, is a sale at retail at the
place where the coal or other mineral mined in Illinois is
extracted from the earth. This paragraph does not apply to coal
or other mineral when it is delivered or shipped by the seller
to the purchaser at a point outside Illinois so that the sale
is exempt under the Federal Constitution as a sale in
interstate or foreign commerce.
Nothing in this Section shall be construed to authorize a
municipality to impose a tax upon the privilege of engaging in
any business which under the constitution of the United States
may not be made the subject of taxation by this State.
When certifying the amount of a monthly disbursement to a

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municipality under this Section, the Department shall increase
or decrease such amount by an amount necessary to offset any
misallocation of previous disbursements. The offset amount
shall be the amount erroneously disbursed within the previous 6
months from the time a misallocation is discovered.
The Department of Revenue shall implement this amendatory
Act of the 91st General Assembly so as to collect the tax on
and after January 1, 2002.
As used in this Section, "municipal" and "municipality"
means a city, village or incorporated town, including an
incorporated town which has superseded a civil township.
This Section shall be known and may be cited as the
"Non-Home Rule Municipal Retailers' Occupation Tax Act".
(Source: P.A. 96-939, eff. 6-24-10; 96-1057, eff. 7-14-10;
97-333, eff. 8-12-11.)
(65 ILCS 5/8-11-1.4) (from Ch. 24, par. 8-11-1.4)
Sec. 8-11-1.4. Non-Home Rule Municipal Service Occupation
Tax Act. The corporate authorities of a non-home rule
municipality may impose a tax upon all persons engaged, in such
municipality, in the business of making sales of service for
expenditure on public infrastructure or for property tax relief
or both as defined in Section 8-11-1.2 if approved by
referendum as provided in Section 8-11-1.1, of the selling
price of all tangible personal property transferred by such
servicemen either in the form of tangible personal property or

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in the form of real estate as an incident to a sale of service.
If the tax is approved by referendum on or after July 14, 2010
(the effective date of Public Act 96-1057), the corporate
authorities of a non-home rule municipality may, until December
31, 2020 December 31, 2015, use the proceeds of the tax for
expenditure on municipal operations, in addition to or in lieu
of any expenditure on public infrastructure or for property tax
relief. The tax imposed may not be more than 1% and may be
imposed only in 1/4% increments. The tax may not be imposed on
the sale of food for human consumption that is to be consumed
off the premises where it is sold (other than alcoholic
beverages, soft drinks, and food that has been prepared for
immediate consumption) and prescription and nonprescription
medicines, drugs, medical appliances, and insulin, urine
testing materials, syringes, and needles used by diabetics. The
tax imposed by a municipality pursuant to this Section and all
civil penalties that may be assessed as an incident thereof
shall be collected and enforced by the State Department of
Revenue. The certificate of registration which is issued by the
Department to a retailer under the Retailers' Occupation Tax
Act or under the Service Occupation Tax Act shall permit such
registrant to engage in a business which is taxable under any
ordinance or resolution enacted pursuant to this Section
without registering separately with the Department under such
ordinance or resolution or under this Section. The Department
shall have full power to administer and enforce this Section;

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to collect all taxes and penalties due hereunder; to dispose of
taxes and penalties so collected in the manner hereinafter
provided, and to determine all rights to credit memoranda
arising on account of the erroneous payment of tax or penalty
hereunder. In the administration of, and compliance with, this
Section the Department and persons who are subject to this
Section shall have the same rights, remedies, privileges,
immunities, powers and duties, and be subject to the same
conditions, restrictions, limitations, penalties and
definitions of terms, and employ the same modes of procedure,
as are prescribed in Sections 1a-1, 2, 2a, 3 through 3-50 (in
respect to all provisions therein other than the State rate of
tax), 4 (except that the reference to the State shall be to the
taxing municipality), 5, 7, 8 (except that the jurisdiction to
which the tax shall be a debt to the extent indicated in that
Section 8 shall be the taxing municipality), 9 (except as to
the disposition of taxes and penalties collected, and except
that the returned merchandise credit for this municipal tax may
not be taken against any State tax), 10, 11, 12 (except the
reference therein to Section 2b of the Retailers' Occupation
Tax Act), 13 (except that any reference to the State shall mean
the taxing municipality), the first paragraph of Section 15,
16, 17, 18, 19 and 20 of the Service Occupation Tax Act and
Section 3-7 of the Uniform Penalty and Interest Act, as fully
as if those provisions were set forth herein.
No municipality may impose a tax under this Section unless

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the municipality also imposes a tax at the same rate under
Section 8-11-1.3 of this Code.
Persons subject to any tax imposed pursuant to the
authority granted in this Section may reimburse themselves for
their serviceman's tax liability hereunder by separately
stating such tax as an additional charge, which charge may be
stated in combination, in a single amount, with State tax which
servicemen are authorized to collect under the Service Use Tax
Act, pursuant to such bracket schedules as the Department may
prescribe.
Whenever the Department determines that a refund should be
made under this Section to a claimant instead of issuing credit
memorandum, the Department shall notify the State Comptroller,
who shall cause the order to be drawn for the amount specified,
and to the person named, in such notification from the
Department. Such refund shall be paid by the State Treasurer
out of the municipal retailers' occupation tax fund.
The Department shall forthwith pay over to the State
Treasurer, ex officio, as trustee, all taxes and penalties
collected hereunder.
As soon as possible after the first day of each month,
beginning January 1, 2011, upon certification of the Department
of Revenue, the Comptroller shall order transferred, and the
Treasurer shall transfer, to the STAR Bonds Revenue Fund the
local sales tax increment, as defined in the Innovation
Development and Economy Act, collected under this Section

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during the second preceding calendar month for sales within a
STAR bond district.
After the monthly transfer to the STAR Bonds Revenue Fund,
on or before the 25th day of each calendar month, the
Department shall prepare and certify to the Comptroller the
disbursement of stated sums of money to named municipalities,
the municipalities to be those from which suppliers and
servicemen have paid taxes or penalties hereunder to the
Department during the second preceding calendar month. The
amount to be paid to each municipality shall be the amount (not
including credit memoranda) collected hereunder during the
second preceding calendar month by the Department, and not
including an amount equal to the amount of refunds made during
the second preceding calendar month by the Department on behalf
of such municipality, and not including any amounts that are
transferred to the STAR Bonds Revenue Fund. Within 10 days
after receipt, by the Comptroller, of the disbursement
certification to the municipalities and the General Revenue
Fund, provided for in this Section to be given to the
Comptroller by the Department, the Comptroller shall cause the
orders to be drawn for the respective amounts in accordance
with the directions contained in such certification.
The Department of Revenue shall implement this amendatory
Act of the 91st General Assembly so as to collect the tax on
and after January 1, 2002.
Nothing in this Section shall be construed to authorize a

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municipality to impose a tax upon the privilege of engaging in
any business which under the constitution of the United States
may not be made the subject of taxation by this State.
As used in this Section, "municipal" or "municipality"
means or refers to a city, village or incorporated town,
including an incorporated town which has superseded a civil
township.
This Section shall be known and may be cited as the
"Non-Home Rule Municipal Service Occupation Tax Act".
(Source: P.A. 96-939, eff. 6-24-10; 96-1057, eff. 7-14-10;
97-333, eff. 8-12-11.)
(65 ILCS 5/8-11-1.5) (from Ch. 24, par. 8-11-1.5)
Sec. 8-11-1.5. Non-Home Rule Municipal Use Tax Act. The
corporate authorities of a non-home rule municipality may
impose a tax upon the privilege of using, in such municipality,
any item of tangible personal property which is purchased at
retail from a retailer, and which is titled or registered with
an agency of this State's government, based on the selling
price of such tangible personal property, as "selling price" is
defined in the Use Tax Act, for expenditure on public
infrastructure or for property tax relief or both as defined in
Section 8-11-1.2, if approved by referendum as provided in
Section 8-11-1.1. If the tax is approved by referendum on or
after the effective date of this amendatory Act of the 96th
General Assembly, the corporate authorities of a non-home rule

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municipality may, until December 31, 2020 December 31, 2015,
use the proceeds of the tax for expenditure on municipal
operations, in addition to or in lieu of any expenditure on
public infrastructure or for property tax relief. The tax
imposed may not be more than 1% and may be imposed only in 1/4%
increments. Such tax shall be collected from persons whose
Illinois address for title or registration purposes is given as
being in such municipality. Such tax shall be collected by the
municipality imposing such tax. A non-home rule municipality
may not impose and collect the tax prior to January 1, 2002.
This Section shall be known and may be cited as the
"Non-Home Rule Municipal Use Tax Act".
(Source: P.A. 96-1057, eff. 7-14-10.)
Section 99. Effective date. This Act takes effect upon
becoming law.