Bill Text: IL SB3284 | 2017-2018 | 100th General Assembly | Introduced

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Bill Title: Creates the Community Renewal and Revitalization Act. Provides for the qualifications for and designation of Health, Opportunity, Prosperity, and Empowerment (HOPE) Zones. Provides for a HOPE Zone tax credit and other credits and benefits going to businesses operating in HOPE Zones. Provides for the powers and duties of the Department of Commerce and Economic Opportunity under the Act. Provides for State incentives regarding public services and physical infrastructure. Provides for State regulatory exemptions in HOPE Zones. Provides for State and local regulatory alternatives under the Act. Amends the Illinois Income Tax Act to allow for a specified tax credit for wages paid to qualified ex-offenders in HOPE Zones. Modifies the term "qualified ex-offender" to include a person hired by a taxpayer 5 years (currently, 3 years) after being released from an Illinois adult correctional center. Amends the Small Business Job Creation Tax Credit Act to allow a specified tax credit for businesses operating in HOPE Zones. Provides that the Department shall limit the monetary amount of credits awarded under the Act to no more than $100,000,000 (currently, $50,000,000).

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Failed) 2019-01-09 - Session Sine Die [SB3284 Detail]

Download: Illinois-2017-SB3284-Introduced.html

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100TH GENERAL ASSEMBLY State of Illinois 2017 and 2018 SB3284 Introduced 2/15/2018, by Sen. Elgie R. Sims, Jr. SYNOPSIS AS INTRODUCED:
New Act
35 ILCS 5/216
35 ILCS 25/25
35 ILCS 25/30
Creates the Community Renewal and Revitalization Act. Provides for the qualifications for and designation of Health, Opportunity, Prosperity, and Empowerment (HOPE) Zones. Provides for a HOPE Zone tax credit and other credits and benefits going to businesses operating in HOPE Zones. Provides for the powers and duties of the Department of Commerce and Economic Opportunity under the Act. Provides for State incentives regarding public services and physical infrastructure. Provides for State regulatory exemptions in HOPE Zones. Provides for State and local regulatory alternatives under the Act. Amends the Illinois Income Tax Act to allow for a specified tax credit for wages paid to qualified ex-offenders in HOPE Zones. Modifies the term "qualified ex-offender" to include a person hired by a taxpayer 5 years (currently, 3 years) after being released from an Illinois adult correctional center. Amends the Small Business Job Creation Tax Credit Act to allow a specified tax credit for businesses operating in HOPE Zones. Provides that the Department shall limit the monetary amount of credits awarded under the Act to no more than $100,000,000 (currently, $50,000,000).
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A BILL FOR
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AN ACT concerning government.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 1. Short title. This Act may be cited as the
Community Renewal and Revitalization Act.
Section 5. Intent. The intent of this Act is to spur
investment in areas of high unemployment and high crime through
various economic development tools intended to incentivize
businesses to relocate, expand, and develop within those
communities. It is the hope and belief of the General Assembly
that through the creation of Health, Opportunity, Prosperity,
and Empowerment (HOPE) Zones, economic growth and vitality can
foster in impoverished communities of this State.
Section 10. Definitions. As used in this Act:
"Department" means the Department of Commerce and Economic
Opportunity.
"Director" means the Director of the Department of Commerce
and Economic Opportunity.
"HOPE Zone" or "Zone" means a Health, Opportunity,
Prosperity, and Empowerment Zone established under this Act.
Section 15. Qualifications for HOPE Zones.

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(a) An area is qualified to become a HOPE Zone if:
(1) it is a contiguous area, provided that a zone area
may exclude wholly surrounded territory within its
boundaries;
(2) it is comprised of a minimum of one-half square
mile and not more than 15 square miles, in total area,
exclusive of lakes and waterways;
(3) it is entirely within a municipality or entirely
within the unincorporated areas of a county, except where
reasonable need is established for such zone to cover
portions of more than one municipality or county;
(4) all or part of the area to be designated as a HOPE
Zone has had an annual average unemployment rate of at
least 120% of the State's annual average unemployment rate
for the most recent calendar year or the most recent fiscal
year as reported by the Department of Employment Security;
and
(5) all or part of the area to be designated as a HOPE
Zone has a poverty rate of at least 20% according to the
latest federal decennial census, and a census tract crime
rate higher than the State average.
(b) Any criteria established by the Department or by law
which utilize the rate of unemployment for a particular area
shall provide that all persons who are not presently employed
and have exhausted all unemployment benefits shall be
considered unemployed, whether or not such persons are actively

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seeking employment.
Section 20. Designation of HOPE Zones.
(a) Any area determined by the Director of the Department
of Commerce and Economic Opportunity as meeting the
qualifications established under Section 10 shall be
designated a HOPE Zone, and be eligible for benefits under this
Act.
(b) Upon designation of a HOPE Zone, the Director shall
provide:
(1) a precise description of the area comprising the
Zone, either in the form of a legal description or by
reference to roadways, lakes and waterways, and township
and county boundaries;
(2) a finding that the Zone area meets the
qualifications established under Section 10;
(3) provisions for any tax incentives or reimbursement
for taxes, which under State and federal law apply to
businesses within the designated Zone;
(4) the duration or term of the HOPE Zone, which shall
be no less than 10 years in duration; and
(5) any other information the Director deems necessary
to the establishment of HOPE Zones under this Act.
(c) Nothing in this Section shall prohibit a municipality
or county from extending additional tax incentives or
reimbursement for businesses in HOPE Zones or throughout their

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territory by separate ordinance. Nothing in this Section shall
prohibit a municipality or county from applying to be an
Enterprise Zone under the Illinois Enterprise Zone Act.
Section 25. HOPE Zone tax credit.
(a) The HOPE Zone tax credit is hereby created to be
granted to businesses relocating to, expanding within,
developing within, or existing within areas designated as HOPE
Zones under this Act.
(b) Businesses maintaining operations within a HOPE Zone
shall be eligible to receive a 50% tax credit on its annual
corporate income tax, and a tax credit to all fees and
franchise taxes paid to the Secretary of State for organizing
and maintaining any business organization within the Zone.
(c) Individuals living within a HOPE Zone shall also be
eligible to receive a 50% tax credit to their annual individual
income tax.
(d) Any business designated as a "High Impact Business"
under Section 5.5 of the Illinois Enterprise Zone Act that
intends to invest in a HOPE Zone, in a manner specified in
subparagraphs (A) through (F) of that Section, shall be
eligible for the credits and benefits provided in that Section.
All provisions and procedures in Section 5.5 of the Illinois
Enterprise Zone Act with respect to the application and
designation of High Impact Businesses shall apply.

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Section 30. Powers and duties of the Department.
(a) General powers. The Department shall administer this
Act and shall have the following powers and duties:
(1) To monitor the implementation of this Act and
submit reports evaluating the effectiveness of the program
and any suggestions for legislation to the Governor and
General Assembly by October 1 of every year preceding a
regular Session of the General Assembly and to annually
report to the General Assembly initial and current
population, employment, per capita income, number of
business establishments, dollar value of new construction
and improvements, and the aggregate value of each tax
incentive, based on information provided by the Department
of Revenue, for each HOPE Zone.
(2) To adopt all necessary rules and regulations to
carry out the purposes of this Act in accordance with The
Illinois Administrative Procedure Act.
(3) To assist municipalities and counties in obtaining
federal status as an Enterprise Zone.
(b) Specific duties:
(1) The Department shall provide information and
appropriate assistance to persons desiring to locate and
engage in business in a HOPE Zone, to persons engaged in
business in a HOPE Zone, and to designated Zone
organizations operating there.
(2) The Department shall, in cooperation with

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appropriate units of local government and State agencies,
coordinate and streamline existing State business
assistance programs and permit and license application
procedures for HOPE Zone businesses.
(3) The Department shall publicize existing tax
incentives and economic development programs within the
Zone and upon request, offer technical assistance in
abatement and alternative revenue source development to
local units of government which have HOPE Zones within
their jurisdiction.
(4) The Department shall work together with the
responsible State and federal agencies to promote the
coordination of other relevant programs, including, but
not limited to, housing, community and economic
development, small business, banking, financial
assistance, and employment training programs which are
carried on in a HOPE Zone.
(5) In order to stimulate employment opportunities for
Zone residents, the Department, in cooperation with the
Department of Human Services and the Department of
Employment Security, is to initiate a test of the following
2 programs within the 12 month period following designation
and approval by the Department of the first HOPE zones: (i)
the use of aid to families with dependent children benefits
payable under Article IV of the Illinois Public Aid Code,
General Assistance benefits payable under Article VI of the

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Illinois Public Aid Code, the unemployment insurance
benefits payable under the Unemployment Insurance Act as
training or employment subsidies leading to unsubsidized
employment; and (ii) a program for voucher reimbursement of
the cost of training Zone residents eligible under the
Targeted Jobs Tax Credit provisions of the Internal Revenue
Code for employment in private industry. These programs
shall not be designed to subsidize businesses, but are
intended to open up job and training opportunities not
otherwise available. Nothing in this paragraph (5) shall be
deemed to require Zone businesses to utilize these
programs. These programs should be designed (i) for those
individuals whose opportunities for job-finding are
minimal without program participation; (ii) to minimize
the period of benefit collection by such individuals; and
(iii) to accelerate the transition of those individuals to
unsubsidized employment. The Department is to seek
agreement with business, organized labor and the
appropriate State Department, and agencies on the design,
operation, and evaluation of the test programs.
A report with recommendations including representative
comments of these groups shall be submitted by the Department
to the Governor and General Assembly not later than 12 months
after such test programs have commenced, or not later than 3
months following the termination of such test programs,
whichever first occurs.

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Section 35. State incentives regarding public services and
physical infrastructure.
(a) Industrial development bonds. Priority in the use of
industrial development bonds issued by the Illinois Finance
Authority shall be given to businesses located in HOPE Zones.
(b) Deposit of State funds by the State Treasurer. The
State Treasurer is authorized and encouraged to place deposits
of State funds with financial institutions doing business in
HOPE Zones.
Section 40. State regulatory exemptions in HOPE Zones.
(a) The Department shall conduct an ongoing review of such
agency rules and regulations that may be identified by the
Department as businesses and preliminarily appearing to the
Department to:
(i) affect the conduct of business, industry, and
commerce;
(ii) impose excessive costs on either the creation or
conduct of such businesses; and
(iii) inhibit the development and expansions of
businesses within HOPE Zones.
The Department shall conduct hearings, pursuant to public
notice, to solicit public comment on such identified rules and
regulations as part of this review process.
(b) No later than August 1 of each calendar year, the

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Department shall publish in the Illinois Register a list of
such rules and regulations identified under subsection (a). The
Department shall transmit a copy of the list to each agency
which has adopted rules or regulations on the list.
(c) Within 90 days of the publication of the list by the
Department, each agency which adopted rules or regulations
identified therein shall file a written report with the
Department detailing for each identified rule or regulation:
(i) the need or justification;
(ii) whether the rule or regulation is mandated by
State or federal law, or is discretionary, and to what
extent;
(iii) a synopsis of the history of the rule, including
any internal agency review after its original adoption; and
(iv) any appropriate explanation of its relationship
to other regulatory requirements.
The adopting agency shall also include any available data,
analysis, and studies concerning the economic impact of the
identified rules and regulations. The agency responses shall be
public records.
(d) No later than January 1 of the following calendar year,
the Department shall file proposed rules exempting businesses
within HOPE Zones from those agency rules and regulations
contained in the published list, for which the Department finds
that the job creation or business development incentives for
HOPE Zone development engendered by the exemption outweigh the

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need and justification for the rule or regulation. In making
its findings, the Department shall consider all information,
data, and opinions submitted to it by the public, as well as by
adopting agencies, as well as information otherwise available
to it.
(e) The proposed rules and regulations adopted by the
Department shall be in the form of amendments to the existing
rules and regulations to be affected, and shall be subject to
the Illinois Administrative Procedure Act.
(f) Upon its effective date, any exempting rule or
regulation of the Department shall supersede the exempted
agency rule or regulation in accordance with the terms of the
exemption. Such exemptions may apply only to businesses within
HOPE Zones during the effective term of the respective Zones.
Agencies may not adopt emergency rules to circumvent an
exemption effected by a Department exemption rule; any such
emergency rules shall not be effective within HOPE Zones to the
extent inconsistent with the terms of such an exemption.
Section 45. State and local regulatory alternatives.
(a) Agencies may provide in their rules and regulations for
(i) the exemption of businesses within HOPE Zones; or (ii)
modifications or alternatives specifically applicable to
businesses within HOPE Zones, which impose less stringent
standards or alternative standards for compliance, including
performance-based standards as a substitute for specific

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mandates of methods, procedures, or equipment.
Such exemptions, modifications, or alternatives shall be
effected by rule or regulation adopted in accordance with the
Illinois Administrative Procedure Act. The agency adopting
exemptions, modifications, or alternatives shall file with its
proposed rule or regulation its findings that the proposed rule
or regulation provides economic incentives within HOPE Zones
which promote the purposes of this Act, and which, to the
extent they include any exemptions or reductions in regulatory
standards or requirements, outweigh the need or justification
for the existing rule or regulation.
(b) If any agency adopts a rule or regulation under
subsection (a) of this Section affecting a rule or regulation
contained on the list published by the Department under Section
35 of this Act, prior to the completion of the rule making
process for the Department's rules under that Section, the
agency shall immediately transmit a copy of its proposed rule
or regulation to the Department, together with a statement of
reasons as to why the Department should defer to the agency's
proposed rule or regulation. Agency rules adopted under
subsection (a) of this Section shall, however, be subject to
the exemption rules and regulations of the Department adopted
under Section 35 of this Act.
(c) The county or municipality containing a HOPE Zone may
modify all local ordinances and regulations regarding (1)
zoning; (2) licensing; (3) building codes, excluding however,

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any regulations treating building defects; and (4) rent control
and price controls; except for the minimum wage.
Notwithstanding any shorter statute of limitation to the
contrary, actions against any contractor or architect who
designs, constructs, or rehabilitates a building or structure
in a HOPE Zone in accordance with local standards specifically
applicable within Zones which have been relaxed may be
commenced within 10 years from the time of beneficial occupancy
of the building or use of the structure.
Section 100. The Illinois Income Tax Act is amended by
changing Section 216 as follows:
(35 ILCS 5/216)
Sec. 216. Credit for wages paid to ex-felons.
(a) For each taxable year beginning on or after January 1,
2007, each taxpayer is entitled to a credit against the tax
imposed by subsections (a) and (b) of Section 201 of this Act
in an amount equal to 5% of qualified wages paid by the
taxpayer during the taxable year to one or more Illinois
residents who are qualified ex-offenders. The total credit
allowed to a taxpayer with respect to each qualified
ex-offender may not exceed $1,500 for all taxable years, except
that a taxpayer operating a business in a HOPE Zone under the
Community Renewal and Revitalization Act shall be allowed a
total credit up to $3,000 with respect to each qualified

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ex-offender for all taxable years. 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, there shall
be allowed a credit under this Section to 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.
(b) For purposes of this Section, "qualified wages":
(1) includes only wages that are subject to federal
unemployment tax under Section 3306 of the Internal Revenue
Code, without regard to any dollar limitation contained in
that Section;
(2) does not include any amounts paid or incurred by an
employer for any period to any qualified ex-offender for
whom the employer receives federally funded payments for
on-the-job training of that qualified ex-offender for that
period; and
(3) includes only wages attributable to service
rendered during the one-year period beginning with the day
the qualified ex-offender begins work for the employer.
If the taxpayer has received any payment from a program
established under Section 482(e)(1) of the federal Social
Security Act with respect to a qualified ex-offender, then, for
purposes of calculating the credit under this Section, the
amount of the qualified wages paid to that qualified

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ex-offender must be reduced by the amount of the payment.
(c) For purposes of this Section, "qualified ex-offender"
means any person who:
(1) has been convicted of a crime in this State or of
an offense in any other jurisdiction, not including any
offense or attempted offense that would subject a person to
registration under the Sex Offender Registration Act;
(2) was sentenced to a period of incarceration in an
Illinois adult correctional center; and
(3) was hired by the taxpayer within 5 3 years after
being released from an Illinois adult correctional center.
(d) 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.
(e) This Section is exempt from the provisions of Section
250.
(Source: P.A. 98-165, eff. 8-5-13.)
Section 105. The Small Business Job Creation Tax Credit Act
is amended by changing Sections 25 and 30 as follows:

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(35 ILCS 25/25)
Sec. 25. Tax credit.
(a) Subject to the conditions set forth in this Act, an
applicant is entitled to a credit against payment of taxes
withheld under Section 704A of the Illinois Income Tax Act:
(1) for new employees who participated as
worker-trainees in the Put Illinois to Work Program during
2010:
(A) in the first calendar year ending on or after
the date that is 6 months after December 31, 2010, or
the date of hire, whichever is later. Under this
subparagraph, the applicant is entitled to one-half of
the credit allowable for each new employee who is
employed for at least 6 months after the date of hire;
and
(B) in the first calendar year ending on or after
the date that is 12 months after December 31, 2010, or
the date of hire, whichever is later. Under this
subparagraph, the applicant is entitled to one-half of
the credit allowable for each new employee who is
employed for at least 12 months after the date of hire;
(2) for all other new employees, in the first calendar
year ending on or after the date that is 12 months after
the date of hire of a new employee. The credit shall be
allowed as a credit to an applicant for each full-time

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employee hired during the incentive period that results in
a net increase in full-time Illinois employees, where the
net increase in the employer's full-time Illinois
employees is maintained for at least 12 months.
(b) The Department shall make credit awards under this Act
to further job creation.
(c) The credit shall be claimed for the first calendar year
ending on or after the date on which the certificate is issued
by the Department.
(d) The credit shall not exceed $2,500 per new employee
hired; however, businesses operating within HOPE Zones under
the Community Renewal and Revitalization Act shall be allowed a
credit up to $5,000 per new employee hired.
(e) The net increase in full-time Illinois employees,
measured on an annual full-time equivalent basis, shall be the
total number of full-time Illinois employees of the applicant
on the final day of the incentive period, minus the number of
full-time Illinois employees employed by the employer on the
first day of that same incentive period. For purposes of the
calculation, an employer that begins doing business in this
State during the incentive period, as determined by the
Director, shall be treated as having zero Illinois employees on
the first day of the incentive period.
(f) The net increase in the number of full-time Illinois
employees of the applicant under subsection (e) must be
sustained continuously for at least 12 months, starting with

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the date of hire of a new employee during the incentive period.
Eligibility for the credit does not depend on the continuous
employment of any particular individual. For purposes of this
subsection (f), if a new employee ceases to be employed before
the completion of the 12-month period for any reason, the net
increase in the number of full-time Illinois employees shall be
treated as continuous if a different new employee is hired as a
replacement within a reasonable time for the same position.
(g) The Department shall promulgate rules to enable an
applicant for which a PEO has been contracted to issue W-2s and
make payment of taxes withheld under Section 704A of the
Illinois Income Tax Act for new employees to retain the benefit
of tax credits to which the applicant is otherwise entitled
under this Act.
(Source: P.A. 96-888, eff. 4-13-10; 96-1498, eff. 1-18-11;
97-636, eff. 6-1-12; 97-1052, eff. 8-23-12.)
(35 ILCS 25/30)
Sec. 30. Maximum amount of credits allowed. The Department
shall limit the monetary amount of credits awarded under this
Act to no more than $100,000,000 $50,000,000. If applications
for a greater amount are received, credits shall be allowed on
a first-come-first-served basis, based on the date on which
each properly completed application for a certificate of
eligibility is received by the Department. If more than one
certificate of eligibility is received on the same day, the

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credits will be awarded based on the time of submission for
that particular day.
(Source: P.A. 96-888, eff. 4-13-10.)