Bill Text: IL SB0665 | 2021-2022 | 102nd General Assembly | Engrossed

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Bill Title: Reinserts the provisions of Senate Amendment No. 3 with the following changes: removes findings; inserts a definition of "vacant lot" and makes conforming changes; provides that vacant lots may be sold or conveyed (rather than sold and conveyed) to nonprofit corporations or associations and makes conforming changes; provides that any conveyance or sale of property pursuant to the provisions shall contain a limitation that the property shall only be used by the nonprofit corporation or association for one or more of (i) the cultivation of land for gardening fruits and vegetables, or (ii) the sale of fresh fruits and vegetables (rather than a conveyance shall contain a limitation that the lands or buildings shall be used only for the purposes of the nonprofit organization or association and to render such services or to provide such facilities as may be agreed upon); and makes other changes.

Spectrum: Partisan Bill (Democrat 5-0)

Status: (Engrossed - Dead) 2021-05-15 - Rule 19(a) / Re-referred to Rules Committee [SB0665 Detail]

Download: Illinois-2021-SB0665-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 Property Tax Code is amended by changing
Section 15-65 as follows:
(35 ILCS 200/15-65)
Sec. 15-65. Charitable purposes. All property of the
following is exempt when actually and exclusively used for
charitable or beneficent purposes, and not leased or otherwise
used with a view to profit:
(a) Institutions of public charity.
(b) Beneficent and charitable organizations
incorporated in any state of the United States, including
organizations whose owner, and no other person, uses the
property exclusively for the distribution, sale, or resale
of donated goods and related activities and uses all the
income from those activities to support the charitable,
religious or beneficent activities of the owner, whether
or not such activities occur on the property.
(c) Old people's homes, facilities for persons with a
developmental disability, and not-for-profit
organizations providing services or facilities related to
the goals of educational, social and physical development,

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if, upon making application for the exemption, the
applicant provides affirmative evidence that the home or
facility or organization is an exempt organization under
paragraph (3) of Section 501(c) of the Internal Revenue
Code or its successor, and either: (i) the bylaws of the
home or facility or not-for-profit organization provide
for a waiver or reduction, based on an individual's
ability to pay, of any entrance fee, assignment of assets,
or fee for services, or (ii) the home or facility is
qualified, built or financed under Section 202 of the
National Housing Act of 1959, as amended.
An applicant that has been granted an exemption under
this subsection on the basis that its bylaws provide for a
waiver or reduction, based on an individual's ability to
pay, of any entrance fee, assignment of assets, or fee for
services may be periodically reviewed by the Department to
determine if the waiver or reduction was a past policy or
is a current policy. The Department may revoke the
exemption if it finds that the policy for waiver or
reduction is no longer current.
If a not-for-profit organization leases property that
is otherwise exempt under this subsection to an
organization that conducts an activity on the leased
premises that would entitle the lessee to an exemption
from real estate taxes if the lessee were the owner of the
property, then the leased property is exempt.

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(d) Not-for-profit health maintenance organizations
certified by the Director of the Illinois Department of
Insurance under the Health Maintenance Organization Act,
including any health maintenance organization that
provides services to members at prepaid rates approved by
the Illinois Department of Insurance if the membership of
the organization is sufficiently large or of indefinite
classes so that the community is benefited by its
operation. No exemption shall apply to any hospital or
health maintenance organization which has been adjudicated
by a court of competent jurisdiction to have denied
admission to any person because of race, color, creed, sex
or national origin.
(e) All free public libraries.
(f) Historical societies.
(g) Cultivation and sale of fresh fruits and
vegetables. A vacant lot that is leased from a
municipality or owned by a nonprofit corporation or
association for the cultivation, sale, or cultivation and
sale of fresh fruits and vegetables under Section 11-11-4
of the Illinois Municipal Code is exempt when actually and
exclusively used for such purposes. To qualify for the
exemption, the nonprofit corporation or association must
verify that it is not controlled, directly or indirectly,
by any agricultural, commercial, or other business. The
nonprofit corporation or association must also verify

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that, if the fresh fruits or vegetables are sold, any
profits are used to further the mission of the exempt
organization.
Property otherwise qualifying for an exemption under this
Section shall not lose its exemption because the legal title
is held (i) by an entity that is organized solely to hold that
title and that qualifies under paragraph (2) of Section 501(c)
of the Internal Revenue Code or its successor, whether or not
that entity receives rent from the charitable organization for
the repair and maintenance of the property, (ii) by an entity
that is organized as a partnership or limited liability
company, in which the charitable organization, or an affiliate
or subsidiary of the charitable organization, is a general
partner of the partnership or managing member of the limited
liability company, for the purposes of owning and operating a
residential rental property that has received an allocation of
Low Income Housing Tax Credits for 100% of the dwelling units
under Section 42 of the Internal Revenue Code of 1986, as
amended, or (iii) for any assessment year including and
subsequent to January 1, 1996 for which an application for
exemption has been filed and a decision on which has not become
final and nonappealable, by a limited liability company
organized under the Limited Liability Company Act provided
that (A) the limited liability company's sole member or
members, as that term is used in Section 1-5 of the Limited
Liability Company Act, are the institutions of public charity

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that actually and exclusively use the property for charitable
and beneficent purposes; (B) the limited liability company is
a disregarded entity for federal and Illinois income tax
purposes and, as a result, the limited liability company is
deemed exempt from income tax liability by virtue of the
Internal Revenue Code Section 501(c)(3) status of its sole
member or members; and (C) the limited liability company does
not lease the property or otherwise use it with a view to
profit.
(Source: P.A. 96-763, eff. 8-25-09.)
Section 10. The Illinois Municipal Code is amended by
adding Section 11-11-4 as follows:
(65 ILCS 5/11-11-4 new)
Sec. 11-11-4. Lease, conveyance, or sale of property for
cultivation and sale of fresh fruits and vegetables.
(a) As used in this Section, "vacant lot" means all or any
part of municipal-owned property, with or without
improvements, not then needed for municipal purposes, as
determined by the city council of a municipality.
(b) A city council may, by resolution or ordinance,
authorize a leasehold to be made with a nonprofit corporation
or association for a term not in excess of 25 years, and
extended in increments of no more than 25 years, by ordinance
or resolution thereafter for one or more of the following

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purposes:
(1) The cultivation or use of a vacant lot for
gardening fruits and vegetables.
(2) The use of a vacant lot to sell fresh fruits and
vegetables. Any lease entered into pursuant to this
paragraph may permit the nonprofit corporation or
association to sell fresh fruits and vegetables on the
leased land, off the leased land, or both, if the sales are
related and incidental to the nonprofit purposes of the
corporation or association and the net proceeds received
by the nonprofit corporation or association are used to
further the nonprofit purposes of the corporation or
association.
(c) A city council may, by resolution or ordinance,
authorize a private sale or conveyance of a vacant lot, or any
part thereof, for nominal consideration, without compliance
with any other law governing disposal of lands by
municipalities requiring adequate consideration, to a
nonprofit corporation or association for use for one or more
of the following purposes:
(1) The cultivation or use of the lot for gardening
fruits and vegetables.
(2) The use of the lot to sell fresh fruits and
vegetables. Any sale or conveyance entered into pursuant
to this paragraph may permit the nonprofit corporation or
association to sell fresh fruits and vegetables on the

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lot, off the lot, or both, provided, that: (i) the sales
are related and incidental to the purpose of the nonprofit
corporation or association and (ii) the net proceeds
received by the nonprofit corporation or association are
used to further the purposes of the nonprofit corporation
or association.
Any conveyance or sale of property pursuant to this
subsection shall contain a limitation that the property shall
only be used by the nonprofit corporation or association for
one or more of the following purposes: (i) the cultivation of
land for gardening fruits and vegetables; or (ii) the sale of
fresh fruits and vegetables. If it is determined by the city
council of the municipality that the property is being used
for any purpose other than the purposes set forth in this
subsection, its full right and title shall revert back to the
municipality without any entry or reentry made on the property
on behalf of the municipality.
Whenever a sale of property is proposed pursuant to this
subsection, the municipality shall give at least 10 days'
notice of such sale prior to a public hearing where an
ordinance or resolution approving the sale is adopted.
Property subject to an unexpired lease under subsection
(b) is not eligible to be sold under this subsection, unless
the lease would allow such a sale.
(d) A nonprofit organization or association leasing,
conveyed, or sold a lot under this Section may not be

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controlled, directly or indirectly, by any agricultural,
commercial, or other business. The nonprofit organization or
association must also include among its principal purposes the
cultivation, sale, or cultivation and sale of fresh fruits and
vegetables.
(e) A nonprofit organization or association leasing,
conveyed, or sold a lot under this Section is authorized to
sell fresh fruits and vegetables either on the land, off the
land, or both, and the sales must be related and incidental to
the nonprofit purposes of the organization or association and
the net proceeds received by the nonprofit organization or
association must be used to further the nonprofit purposes of
the organization or association.
(f) Property leased, conveyed, or sold under this Section
may be exempt from property taxation if the requirements of
subsection (g) of Section 15-65 of the Property Tax Code are
sufficiently met and the property is actually and exclusively
used for the cultivation, sale, or cultivation and sale of
fresh fruits and vegetables.