Rep. Robert Rita

Filed: 5/31/2013

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1
AMENDMENT TO SENATE BILL 1739
2 AMENDMENT NO. ______. Amend Senate Bill 1739, AS AMENDED,
3by replacing everything after the enacting clause with the
4following:
5
"ARTICLE 1.
6 Section 1-1. Short title. This Article may be cited as the
7Chicago Casino Development Authority Act. References in this
8Article to "this Act" mean this Article.
9 Section 1-2. Legislative intent.
10 (a) This Act is intended to benefit the people of the City
11of Chicago and the State of Illinois by assisting economic
12development and promoting tourism and by increasing the amount
13of revenues available to the City and the State to assist and
14support education.
15 (b) While authorization of casino gambling in Chicago will

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1enhance investment, development, and tourism in Illinois, it is
2recognized that it will do so successfully only if public
3confidence and trust in the credibility and integrity of the
4gambling operations and the regulatory process is maintained.
5Therefore, the provisions of this Act are designed to allow the
6Illinois Gaming Board to strictly regulate the facilities,
7persons, associations, and practices related to gambling
8operations pursuant to the police powers of the State,
9including comprehensive law enforcement supervision.
10Consistent with the Gaming Board's authority, the Gaming Board
11alone shall regulate any Chicago casino, just as it now
12regulates every other casino in Illinois.
13 Section 1-5. Definitions. As used in this Act:
14 "Authority" means the Chicago Casino Development Authority
15created by this Act.
16 "Casino" means one temporary land-based or water-based
17facility and one permanent land-based or water-based facility
18at which lawful gambling is authorized and licensed as provided
19in the Illinois Gambling Act.
20 "Casino Board" means the board appointed pursuant to this
21Act to govern and control the Authority.
22 "Casino management contract" means a legally binding
23agreement between the Authority and a casino operator licensee
24to operate or manage a casino.
25 "Casino operator licensee" means any person or entity

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1selected by the Authority and approved and licensed by the
2Gaming Board to manage and operate a casino within the City of
3Chicago pursuant to a casino management contract.
4 "City" means the City of Chicago.
5 "Entity" means a corporation, joint venture, partnership,
6limited liability company, trust, or unincorporated
7association.
8 "Executive director" means the person appointed by the
9Casino Board to oversee the daily operations of the Authority.
10 "Gaming Board" means the Illinois Gaming Board created by
11the Illinois Gambling Act.
12 "Mayor" means the Mayor of the City.
13 Section 1-12. Creation of the Authority. There is hereby
14created a political subdivision, unit of local government with
15only the powers authorized by law, body politic, and municipal
16corporation, by the name and style of the Chicago Casino
17Development Authority.
18 Section 1-13. Duties of the Authority. It shall be the duty
19of the Authority, as an owners licensee under the Illinois
20Gambling Act, to promote and maintain a casino in the City. The
21Authority shall own, acquire, construct, lease, equip, and
22maintain grounds, buildings, and facilities for that purpose.
23However, the Authority shall contract with a casino operator
24licensee to manage and operate the casino and in no event shall

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1the Authority or City manage or operate the casino. The
2Authority may contract pursuant to the procedures set forth in
3Section 1-115 with other third parties in order to fulfill its
4purpose. The Authority is responsible for the payment of any
5fees required of a casino operator under subsection (a) of
6Section 7.8 of the Illinois Gambling Act if the casino operator
7licensee is late in paying any such fees. The Authority is
8granted all rights and powers necessary to perform such duties.
9Subject to the provisions of this Act, the Authority and casino
10operator licensee are subject to the Illinois Gambling Act and
11all of the rules of the Gaming Board, which shall be applied to
12the Authority and the casino operator licensee in a manner
13consistent with that of other owners licensees under the
14Illinois Gambling Act. Nothing in this Act shall confer
15regulatory authority on the Chicago Casino Development
16Authority. The Illinois Gaming Board shall have exclusive
17regulatory authority over all gambling operations governed by
18this Act.
19 Section 1-15. Casino Board.
20 (a) The governing and administrative powers of the
21Authority shall be vested in a body known as the Chicago Casino
22Development Board. The Casino Board shall consist of 5 members
23appointed by the Mayor. One of these members shall be
24designated by the Mayor to serve as chairperson. All of the
25members appointed by the Mayor shall be residents of the City.

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1 Members of the Board must include the following:
2 (A) One member who has received, at a minimum, a
3 bachelor's degree from an accredited school and at least 10
4 years of verifiable training and experience in the fields
5 of investigation and law enforcement.
6 (B) One member who is a certified public accountant
7 with experience in auditing and with knowledge of complex
8 corporate structures and transactions.
9 (C) One member who has 5 years' experience as a
10 principal, senior officer, or director of a company or
11 business with either material responsibility for the daily
12 operations and management of the overall company or
13 business or material responsibility for the policy making
14 of the company or business.
15 (D) One member who is a lawyer licensed to practice law
16 in Illinois.
17 Each Casino Board appointee shall be subject to a
18preliminary background investigation completed by the Gaming
19Board within 30 days after the appointee's submission of his or
20her application to the Gaming Board. If the Gaming Board
21determines that there is a substantial likelihood that it will
22not find the appointee to be suitable to serve on the Casino
23Board (applying the same standards for suitability to the
24appointee as the Gaming Board would apply to an owners licensee
25key person under the Gaming Board's adopted rules), then the
26Gaming Board shall provide a written notice of such

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1determination to the appointee and the Corporation Counsel of
2the City. The Mayor may then appoint a new candidate. If no
3such notice is delivered with respect to a particular
4appointee, then commencing on the 31st day following the date
5of the appointee's submission of his or her application to the
6Gaming Board, the appointee shall be deemed an acting member of
7the Casino Board and shall participate as a Casino Board
8member.
9 Each appointee shall be subject to a full background
10investigation and final approval by the Gaming Board prior to
11the opening of the casino. The Gaming Board shall complete its
12full background investigation of the Casino Board appointee
13within 3 months after the date of the appointee's submission of
14his or her application to the Gaming Board. If the Gaming Board
15does not complete its background investigation within the
163-month period, then the Gaming Board shall give a written
17explanation to the appointee, as well as the Mayor, the
18Governor, the President of the Senate, and the Speaker of the
19House of Representatives, as to why it has not reached a final
20determination and set forth a reasonable time when such
21determination shall be made.
22 (b) Casino Board members shall receive $300 for each day
23the Authority meets and shall be entitled to reimbursement of
24reasonable expenses incurred in the performance of their
25official duties. A Casino Board member who serves in the office
26of secretary-treasurer may also receive compensation for

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1services provided as that officer.
2 Section 1-20. Terms of appointments; resignation and
3removal.
4 (a) The Mayor shall appoint 2 members of the Casino Board
5for an initial term expiring July 1 of the year following final
6approval by the Gaming Board, 2 members for an initial term
7expiring July 1 three years following final approval by the
8Gaming Board, and one member for an initial term expiring July
91 five years following final approval by the Gaming Board.
10 (b) All successors shall be appointed by the Mayor to hold
11office for a term of 5 years from the first day of July of the
12year in which they are appointed, except in the case of an
13appointment to fill a vacancy. Each member, including the
14chairperson, shall hold office until the expiration of his or
15her term and until his or her successor is appointed and
16qualified. Nothing shall preclude a member from serving
17consecutive terms. Any member may resign from office, to take
18effect when a successor has been appointed and qualified. A
19vacancy in office shall occur in the case of a member's death
20or indictment, conviction, or plea of guilty to a felony. A
21vacancy shall be filled for the unexpired term by the Mayor
22subject to the approval of the Gaming Board as provided in this
23Section.
24 (c) Members of the Casino Board shall serve at the pleasure
25of the Mayor. The Mayor or the Gaming Board may remove any

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1member of the Casino Board upon a finding of incompetence,
2neglect of duty, or misfeasance or malfeasance in office or for
3a violation of this Act. The Gaming Board may remove any member
4of the Casino Board for any violation of the Illinois Gambling
5Act or the rules and regulations of the Gaming Board.
6 (d) No member of the Casino Board shall engage in any
7political activity. For the purpose of this Section, "political
8activity" means any activity in support of or in connection
9with any campaign for federal, State, or local elective office
10or any political organization, but does not include activities
11(i) relating to the support or opposition of any executive,
12legislative, or administrative action, as those terms are
13defined in Section 2 of the Lobbyist Registration Act, (ii)
14relating to collective bargaining, or (iii) that are otherwise
15in furtherance of the person's official duties or governmental
16and public service functions.
17 Section 1-25. Organization of Casino Board; meetings.
18After appointment by the Mayor, the Casino Board shall organize
19for the transaction of business, provided that the Casino Board
20shall not take any formal action until after the Gaming Board
21has completed its preliminary background investigation of at
22least a quorum of the Casino Board as provided in subsection
23(a) of Section 1-15. The Casino Board shall prescribe the time
24and place for meetings, the manner in which special meetings
25may be called, and the notice that must be given to members.

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1All actions and meetings of the Casino Board shall be subject
2to the provisions of the Open Meetings Act. Three members of
3the Casino Board shall constitute a quorum. All substantive
4action of the Casino Board shall be by resolution with an
5affirmative vote of a majority of the members.
6 Section 1-30. Executive director; officers.
7 (a) The Casino Board shall appoint an executive director,
8who shall be the chief executive officer of the Authority.
9 The executive director shall be subject to a preliminary
10background investigation to be completed by the Gaming Board
11within 30 days after the executive director's submission of his
12or her application to the Gaming Board. If the Gaming Board
13determines that there is a substantial likelihood that it will
14not find the executive director to be suitable to serve in that
15position (applying the same standards for suitability as the
16Gaming Board would apply to an owners licensee key person under
17the Gaming Board's adopted rules), then the Gaming Board shall
18provide a written notice of such determination to the appointee
19and the Corporation Counsel of the City. The Casino Board may
20then appoint a new executive director. If no such notice is
21delivered, then commencing on the 31st day following the date
22of the executive director's submission of his or her
23application to the Gaming Board, the executive director shall
24commence all duties as the acting executive director of the
25Authority.

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1 The executive director shall be subject to a full
2background investigation and final approval by the Gaming Board
3prior to the opening of the casino. The Gaming Board shall
4complete its full background investigation of the executive
5director within 3 months after the date of the executive
6director's submission of his or her application to the Gaming
7Board. If the Gaming Board does not complete its background
8investigation within the 3-month period, then the Gaming Board
9shall give a written explanation to the appointee, as well as
10the Mayor, the Governor, the President of the Senate, and the
11Speaker of the House of Representatives, as to why it has not
12reached a final determination and set forth a reasonable time
13when such determination shall be made.
14 (b) The Casino Board shall fix the compensation of the
15executive director. Subject to the general control of the
16Casino Board, the executive director shall be responsible for
17the management of the business, properties, and employees of
18the Authority. The executive director shall direct the
19enforcement of all resolutions, rules, and regulations of the
20Casino Board, and shall perform such other duties as may be
21prescribed from time to time by the Casino Board. All employees
22and independent contractors, consultants, engineers,
23architects, accountants, attorneys, financial experts,
24construction experts and personnel, superintendents, managers,
25and other personnel appointed or employed pursuant to this Act
26shall report to the executive director. In addition to any

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1other duties set forth in this Act, the executive director
2shall do or shall delegate to an employee or agent of the
3Authority to do all of the following:
4 (1) Direct and supervise the administrative affairs
5 and activities of the Authority in accordance with its
6 rules, regulations, and policies.
7 (2) Attend meetings of the Casino Board.
8 (3) Keep minutes of all proceedings of the Casino
9 Board.
10 (4) Approve all accounts for salaries, per diem
11 payments, and allowable expenses of the Casino Board and
12 its employees and consultants.
13 (5) Report and make recommendations to the Casino Board
14 concerning the terms and conditions of any casino
15 management contract.
16 (6) Perform any other duty that the Casino Board
17 requires for carrying out the provisions of this Act.
18 (7) Devote his or her full time to the duties of the
19 office and not hold any other office or employment.
20 (c) The Casino Board may select a secretary-treasurer and
21other officers to hold office at the pleasure of the Casino
22Board. The Casino Board shall fix the duties of such officers.
23 Section 1-31. General rights and powers of the Authority.
24 (a) In addition to the duties and powers set forth in this
25Act, the Authority shall have the following rights and powers:

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1 (1) Adopt and alter an official seal.
2 (2) Establish and change its fiscal year.
3 (3) Sue and be sued, plead and be impleaded, all in its
4 own name, and agree to binding arbitration of any dispute
5 to which it is a party.
6 (4) Adopt, amend, and repeal bylaws, rules, and
7 regulations consistent with the furtherance of the powers
8 and duties provided for.
9 (5) Maintain its principal office within the City and
10 such other offices as the Casino Board may designate.
11 (6) Select locations in the City for a temporary and a
12 permanent casino.
13 (7) Subject to the bidding procedures of Section 1-115
14 of this Act, retain or employ, either as regular employees
15 or independent contractors, consultants, engineers,
16 architects, accountants, attorneys, financial experts,
17 construction experts and personnel, superintendents,
18 managers and other professional personnel, and such other
19 personnel as may be necessary in the judgment of the Casino
20 Board, and fix their compensation; however, employees of
21 the Authority shall be hired pursuant to and in accordance
22 with the rules and policies the Authority may adopt.
23 (8) Pursuant to Section 1-115 of this Act, own,
24 acquire, construct, equip, lease, operate, manage, and
25 maintain grounds, buildings, and facilities to carry out
26 its corporate purposes and duties.

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1 (9) Pursuant to Section 1-115, and subject to the
2 oversight, review, and approval of the Gaming Board, enter
3 into, revoke, and modify contracts in accordance with the
4 rules of the Gaming Board as consistently applied to all
5 owners licensees under the Illinois Gambling Act, provided
6 that the Authority may enter into contracts for the design,
7 construction, and outfitting of a temporary casino prior to
8 the Gaming Board's final approval of the Authority's
9 executive director and the members of the Casino Board and
10 prior to the Gaming Board's issuance of the Authority's
11 owners license. Provided further that the entities
12 selected by the Authority for the design, construction, and
13 outfitting of the temporary casino shall be subject to a
14 preliminary background investigation to be completed by
15 the Gaming Board within 30 days after the Gaming Board is
16 provided the identities of the entities. If the Gaming
17 Board determines that there is a substantial likelihood
18 that the entities are not suitable or acceptable to perform
19 their respective functions, then the Gaming Board shall
20 immediately provide notice of that determination to the
21 Authority. If no such notice is delivered, then, commencing
22 on the 31st day following the date on which the information
23 identifying such entities is provided to the Gaming Board,
24 such entities shall be permitted to commence the services
25 contemplated for the design, construction, and outfitting
26 of the temporary casino. In no event, however, shall the

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1 Authority open a casino until after the Gaming Board has
2 finally approved the Authority's executive director and
3 the members of the Casino Board and the Gaming Board has
4 issued the Authority's owners license and the casino
5 operator's casino operator license.
6 (10) Enter into a casino management contract subject to
7 the provisions of Section 1-45 of this Act.
8 (11) Negotiate and enter into intergovernmental
9 agreements with the State and its agencies, the City, and
10 other units of local government, in furtherance of the
11 powers and duties of the Casino Board.
12 (12) Receive and disburse funds for its own corporate
13 purposes or as otherwise specified in this Act.
14 (13) Borrow money from any source, public or private,
15 for any corporate purpose, including, without limitation,
16 working capital for its operations, reserve funds, or
17 payment of interest, and to mortgage, pledge, or otherwise
18 encumber the property or funds of the Authority and to
19 contract with or engage the services of any person in
20 connection with any financing, including financial
21 institutions, issuers of letters of credit, or insurers and
22 enter into reimbursement agreements with this person or
23 entity which may be secured as if money were borrowed from
24 the person or entity.
25 (14) Issue bonds as provided for under this Act.
26 (15) Receive and accept from any source, private or

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1 public, contributions, gifts, or grants of money or
2 property to the Authority.
3 (16) Provide for the insurance of any property,
4 operations, officers, members, agents, or employees of the
5 Authority against any risk or hazard, to self-insure or
6 participate in joint self-insurance pools or entities to
7 insure against such risk or hazard, and to provide for the
8 indemnification of its officers, members, employees,
9 contractors, or agents against any and all risks.
10 (17) Exercise all the corporate powers granted
11 Illinois corporations under the Business Corporation Act
12 of 1983, except to the extent that the powers are
13 inconsistent with those of a body politic and municipal
14 corporation.
15 (18) Do all things necessary or convenient to carry out
16 the powers granted by this Act.
17 (b) The Casino Board shall comply with all applicable legal
18requirements imposed on other owners licensees to conduct all
19background investigations required under the Illinois Gambling
20Act and the rules of the Gaming Board. This requirement shall
21also extend to senior legal, financial, and administrative
22staff of the Authority.
23 Section 1-32. Ethical conduct.
24 (a) Casino Board members and employees of the Authority
25must carry out their duties and responsibilities in such a

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1manner as to promote and preserve public trust and confidence
2in the integrity and conduct of gaming.
3 (b) Except as may be required in the conduct of official
4duties, Casino Board members and employees of the Authority
5shall not engage in gambling on any riverboat, in any casino,
6or in an electronic gaming facility licensed by the Illinois
7Gaming Board or engage in legalized gambling in any
8establishment identified by Gaming Board action that, in the
9judgment of the Gaming Board, could represent a potential for a
10conflict of interest.
11 (c) A Casino Board member or employee of the Authority
12shall not use or attempt to use his or her official position to
13secure or attempt to secure any privilege, advantage, favor, or
14influence for himself or herself or others.
15 (d) Casino Board members and employees of the Authority
16shall not hold or pursue employment, office, position,
17business, or occupation that may conflict with his or her
18official duties. Employees may engage in other gainful
19employment so long as that employment does not interfere or
20conflict with their duties. Such employment must be disclosed
21to the executive director and approved by the Casino Board.
22 (e) Casino Board members, employees of the Authority, and
23elected officials and employees of the City may not engage in
24employment, communications, or any activity identified by the
25Casino Board or Gaming Board that, in the judgment of either
26entity, could represent the potential for or the appearance of

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1a conflict of interest.
2 (f) Casino Board members, employees of the Authority, and
3elected officials and employees of the City may not have a
4financial interest, directly or indirectly, in his or her own
5name or in the name of any other person, partnership,
6association, trust, corporation, or other entity in any
7contract or subcontract for the performance of any work for the
8Authority. This prohibition shall extend to the holding or
9acquisition of an interest in any entity identified by the
10Casino Board or the Gaming Board that, in the judgment of
11either entity, could represent the potential for or the
12appearance of a financial interest. The holding or acquisition
13of an interest in such entities through an indirect means, such
14as through a mutual fund, shall not be prohibited, except that
15the Gaming Board may identify specific investments or funds
16that, in its judgment, are so influenced by gaming holdings as
17to represent the potential for or the appearance of a conflict
18of interest.
19 (g) Casino Board members, employees of the Authority, and
20elected officials and employees of the City may not accept any
21gift, gratuity, service, compensation, travel, lodging, or
22thing of value, with the exception of unsolicited items of an
23incidental nature, from any person, corporation, or entity
24doing business with the Authority.
25 (h) No Casino Board member, employee of the Authority, or
26elected official or employee of the City may, during employment

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1or within a period of 2 years immediately after termination of
2employment, knowingly accept employment or receive
3compensation or fees for services from a person or entity, or
4its parent or affiliate, that has engaged in business with the
5Authority that resulted in contracts with an aggregate value of
6at least $25,000 or if that Casino Board member or employee has
7made a decision that directly applied to the person or entity,
8or its parent or affiliate.
9 (i) A spouse, child, or parent of a Casino Board member,
10employee of the Authority, or elected official or employee of
11the City may not have a financial interest, directly or
12indirectly, in his or her own name or in the name of any other
13person, partnership, association, trust, corporation, or other
14entity in any contract or subcontract for the performance of
15any work for the Authority. This prohibition shall extend to
16the holding or acquisition of an interest in any entity
17identified by the Casino Board or Gaming Board that, in the
18judgment of either entity, could represent the potential for or
19the appearance of a conflict of interest. The holding or
20acquisition of an interest in such entities through an indirect
21means, such as through a mutual fund, shall not be prohibited,
22except that the Gaming Board may identify specific investments
23or funds that, in its judgment, are so influenced by gaming
24holdings as to represent the potential for or the appearance of
25a conflict of interest.
26 (j) A spouse, child, or parent of a Casino Board member,

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1employee of the Authority, or elected official or employee of
2the City may not accept any gift, gratuity, service,
3compensation, travel, lodging, or thing of value, with the
4exception of unsolicited items of an incidental nature, from
5any person, corporation, or entity doing business with the
6Authority.
7 (k) A spouse, child, or parent of a Casino Board member,
8employee of the Authority, or elected official or employee of
9the City may not, while the person is a Board member or
10employee of the spouse or within a period of 2 years
11immediately after termination of employment, knowingly accept
12employment or receive compensation or fees for services from a
13person or entity, or its parent or affiliate, that has engaged
14in business with the Authority that resulted in contracts with
15an aggregate value of at least $25,000 or if that Casino Board
16member, employee, or elected official or employee of the City
17has made a decision that directly applied to the person or
18entity, or its parent or affiliate.
19 (l) No Casino Board member, employee of the Authority, or
20elected official or employee of the City may attempt, in any
21way, to influence any person or entity doing business with the
22Authority or any officer, agent, or employee thereof to hire or
23contract with any person or entity for any compensated work.
24 (m) No Casino Board member, employee of the Authority, or
25elected official or employee of the City shall use or attempt
26to use his or her official position to secure, or attempt to

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1secure, any privilege, advantage, favor, or influence for
2himself or herself or others. No Casino Board member, employee
3of the Authority, or elected official or employee of the City
4shall, within one year immediately preceding appointment by the
5Mayor or employment, have been employed or received
6compensation or fees for services from a person or entity, or
7its parent or affiliate, that has engaged in business with the
8Casino Board, a licensee under this Act, or a licensee under
9the Illinois Gambling Act.
10 (n) Any communication between an elected official of the
11City and any applicant for or party to a casino management
12contract with the Authority, or an officer, director, or
13employee thereof, concerning any matter relating in any way to
14gaming or the Authority shall be disclosed to the Casino Board
15and the Gaming Board. Such disclosure shall be in writing by
16the official within 30 days after the communication and shall
17be filed with the Casino Board and the Gaming Board. Disclosure
18must consist of the date of the communication, the identity and
19job title of the person with whom the communication was made, a
20brief summary of the communication, the action requested or
21recommended, all responses made, the identity and job title of
22the person making the response, and any other pertinent
23information. In addition, if the communication is written or
24digital, then the entire communication shall be disclosed.
25 Public disclosure of the written summary provided to the
26Casino Board and the Gaming Board shall be subject to the

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1exemptions provided under Section 7 of the Freedom of
2Information Act.
3 This subsection (n) shall not apply to communications
4regarding traffic, law enforcement, security, environmental
5issues, City services, transportation, or other routine
6matters concerning the ordinary operations of the casino.
7 (o) For purposes of this Section:
8 "Ordinary operations" means operations relating to the
9casino facility other than the conduct of gambling activities.
10 "Routine matters" includes the application for, issuance,
11renewal, and other processes associated with City permits and
12licenses.
13 "Employee of the City" means only those employees of the
14City who provide services to the Authority or otherwise
15influence the decisions of the Authority or the Casino Board.
16 (p) Any Casino Board member or employee of the Authority
17who violates any provision of this Section is guilty of a Class
184 felony.
19 Section 1-45. Casino management contracts.
20 (a) In accordance with all applicable procurement laws and
21rules, the Casino Board shall develop and administer a
22competitive sealed bidding process for the selection of a
23potential casino operator licensee to develop or operate a
24casino within the City. The Casino Board shall issue one or
25more requests for proposals. The Casino Board may establish

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1minimum financial and investment requirements to determine the
2eligibility of persons to respond to the Casino Board's
3requests for proposals, and may establish and consider such
4other criteria as it deems appropriate. The Casino Board may
5impose a reasonable fee upon persons who respond to requests
6for proposals, in order to reimburse the Casino Board for its
7costs in preparing and issuing the requests and reviewing the
8proposals. At least 30 days prior to the commencement of the
9competitive bidding process, the Gaming Board shall be given an
10opportunity to review the competitive bidding process
11established by the Casino Board. During the competitive bidding
12process, the Casino Board shall keep the Gaming Board apprised
13of the process and the responses received in connection with
14the Casino Board's requests for proposals.
15 (b) Within 5 business days after the time limit for
16submitting bids and proposals has passed, the Casino Board
17shall make all bids and proposals public, provided, however,
18the Casino Board shall not be required to disclose any
19information which would be exempt from disclosure under Section
207 of the Freedom of Information Act. Thereafter, the Casino
21Board shall evaluate the responses to its requests for
22proposals and the ability of all persons or entities responding
23to its requests for proposals to meet the requirements of this
24Act and any relevant provisions of the Illinois Gambling Act
25and to undertake and perform the obligations set forth in its
26requests for proposals.

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1 (c) After reviewing proposals and selecting a successful
2bidder, the Casino Board shall enter into a casino management
3contract with the successful bidder authorizing the operation
4of a casino. The casino operator shall be subject to a
5background investigation and approval by the Gaming Board. The
6Gaming Board shall complete its background investigation and
7approval of the casino operator within 6 months after the date
8that the proposed casino operator submits its application to
9the Gaming Board. If the Gaming Board does not complete its
10background investigation and approval within the 6-month
11period, then the Gaming Board shall give a written explanation
12to the proposed casino operator and the chief legal officer of
13the Authority as to why it has not reached a final
14determination and when it reasonably expects to make a final
15determination. Validity of the casino management contract is
16contingent upon the issuance of a casino operator license to
17the successful bidder. If the Gaming Board grants a casino
18operator license, the Casino Board shall transmit a copy of the
19executed casino management contract to the Gaming Board.
20 (d) After (1) the Authority has been issued an owners
21license, (2) the Gaming Board has issued a casino operator
22license, and (3) the Gaming Board has approved the members of
23the Casino Board, the Authority may conduct gaming operations
24at a temporary facility, subject to the adopted rules of the
25Gaming Board, for no longer than 24 months after gaming
26operations begin. The Gaming Board may, after holding a public

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1hearing, grant an extension so long as a permanent facility is
2not operational and the Authority is working in good faith to
3complete the permanent facility. The Gaming Board may grant
4additional extensions following further public hearings. Each
5extension may be for a period of no longer than 6 months.
6 (e) Fifty percent of any initial consideration received by
7the Authority that was paid as an inducement pursuant to a bid
8for a casino management contract or an executed casino
9management contract must be transmitted to the State and
10deposited into the Gaming Facilities Fee Revenue Fund. The
11initial consideration shall not include (1) any amounts paid to
12the Authority as reimbursement for its costs in preparing or
13issuing the requests for proposals and reviewing the proposals
14or (2) any amounts loaned to the Authority or paid by an entity
15on behalf of the Authority for the design, construction,
16outfitting, or equipping of the casino, pre-opening expenses,
17bank roll or similar expenses required to open and operate the
18casino, or any license or per position fees imposed pursuant to
19the Illinois Gambling Act or any other financial obligation of
20the Authority.
21 Section 1-47. Freedom of Information Act. The Authority
22shall be a public body as defined in the Freedom of Information
23Act and shall be subject to the provisions of the Freedom of
24Information Act.

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1 Section 1-50. Transfer of funds. The revenues received by
2the Authority (other than amounts required to be paid pursuant
3to the Illinois Gambling Act and amounts required to pay the
4operating expenses of the Authority, to pay amounts due the
5casino operator licensee pursuant to a casino management
6contract, to repay any borrowing of the Authority made pursuant
7to Section 1-31, to pay debt service on any bonds issued under
8Section 1-75, and to pay any expenses in connection with the
9issuance of such bonds pursuant to Section 1-75 or derivative
10products pursuant to Section 1-85) shall be transferred to the
11City by the Authority. Moneys transferred to the City pursuant
12to this Section shall be expended or obligated by the City for
13the construction, maintenance, and modernization of schools.
14 Section 1-60. Auditor General.
15 (a) Prior to the issuance of bonds under this Act, the
16Authority shall submit to the Auditor General a certification
17that:
18 (1) it is legally authorized to issue bonds;
19 (2) scheduled annual payments of principal and
20 interest on the bonds to be issued meet the requirements of
21 Section 1-75 of this Act;
22 (3) no bond shall mature later than 30 years; and
23 (4) after payment of costs of issuance and necessary
24 deposits to funds and accounts established with respect to
25 debt service on the bonds, the net bond proceeds (exclusive

09800SB1739ham002- 26 -LRB098 10559 AMC 46792 a
1 of any proceeds to be used to refund outstanding bonds)
2 will be used only for the purposes set forth in this Act.
3 The Authority also shall submit to the Auditor General its
4projections on revenues to be generated and pledged to
5repayment of the bonds as scheduled and such other information
6as the Auditor General may reasonably request.
7 The Auditor General shall examine the certifications and
8information submitted and submit a report to the Authority and
9the Gaming Board indicating whether the required
10certifications, projections, and other information have been
11submitted by the Authority and whether the assumptions
12underlying the projections are not unreasonable in the
13aggregate. The Auditor General shall submit the report no later
14than 60 days after receiving the information required to be
15submitted by the Authority.
16 The Auditor General shall submit a bill to the Authority
17for costs associated with the examinations and report required
18under this Section. The Authority shall reimburse in a timely
19manner.
20 (b) The Authority shall enter into an intergovernmental
21agreement with the Auditor General authorizing the Auditor
22General to, every 2 years, (i) review the financial audit of
23the Authority performed by the Authority's certified public
24accountants, (ii) perform a management audit of the Authority,
25and (iii) perform a management audit of the casino operator
26licensee. The Auditor General shall provide the Authority and

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1the General Assembly with the audits and shall post on his or
2her Internet website such portions of the audit or other
3financial information as generally would be made publicly
4available for other owners licensees under the Illinois
5Gambling Act. The Auditor General shall submit a bill to the
6Authority for costs associated with the review and the audit
7required under this Section, which costs shall not exceed
8$100,000, and the Authority shall reimburse the Auditor General
9for such costs in a timely manner.
10 Section 1-62. Advisory committee. An Advisory Committee is
11established to monitor, review, and report on (1) the
12Authority's utilization of minority-owned business enterprises
13and female-owned business enterprises, (2) employment of
14females, and (3) employment of minorities with regard to the
15development and construction of the casino as authorized under
16Section 7 of the Illinois Gambling Act. The Authority shall
17work with the Advisory Committee in accumulating necessary
18information for the Committee to submit reports, as necessary,
19to the General Assembly and to the City.
20 The Committee shall consist of 9 members as provided in
21this Section. Five members shall be selected by the Governor
22and 4 members shall be selected by the Mayor. The Governor and
23Mayor shall each appoint at least one current member of the
24General Assembly. The Advisory Committee shall meet
25periodically and shall report the information to the Mayor of

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1the City and to the General Assembly by December 31st of every
2year.
3 The Advisory Committee shall be dissolved on the date that
4casino gambling operations are first conducted at a permanent
5facility under the license authorized under Section 7 of the
6Illinois Gambling Act. For the purposes of this Section, the
7terms "female" and "minority person" have the meanings provided
8in Section 2 of the Business Enterprise for Minorities,
9Females, and Persons with Disabilities Act.
10 Section 1-65. Acquisition of property; eminent domain
11proceedings. For the lawful purposes of this Act, the City may
12acquire, by eminent domain or by condemnation proceedings in
13the manner provided by the Eminent Domain Act, real or personal
14property or interests in real or personal property located in
15the City, and the City may convey to the Authority property so
16acquired. The acquisition of property under this Section is
17declared to be for a public use.
18 Section 1-67. Gaming at Chicago airports prohibited. The
19Authority may not conduct gaming operations in an airport.
20 Section 1-70. Local regulation. In addition to this Act,
21the Illinois Gambling Act, and all of the rules of the Gaming
22Board, the casino facilities and operations therein shall be
23subject to all ordinances and regulations of the City. The

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1construction, development, and operation of the casino shall
2comply with all ordinances, regulations, rules, and controls of
3the City, including, but not limited to, those relating to
4zoning and planned development, building, fire prevention, and
5land use. However, the regulation of gaming operations is
6subject to the exclusive jurisdiction of the Gaming Board. The
7Gaming Board shall be responsible for the investigation for and
8issuance of all licenses required by this Act and the Illinois
9Gambling Act.
10 Section 1-75. Borrowing.
11 (a) The Authority may borrow money and issue bonds as
12provided in this Section. Bonds of the Authority may be issued
13to provide funds for land acquisition, site assembly and
14preparation, and the design and construction of the casino, as
15defined in the Illinois Gambling Act, all ancillary and related
16facilities comprising the casino complex, and all on-site and
17off-site infrastructure improvements required in connection
18with the development of the casino; to refund (at the time or
19in advance of any maturity or redemption) or redeem any bonds
20of the Authority; to provide or increase a debt service reserve
21fund or other reserves with respect to any or all of its bonds;
22or to pay the legal, financial, administrative, bond insurance,
23credit enhancement, and other legal expenses of the
24authorization, issuance, or delivery of bonds. In this Act, the
25term "bonds" also includes notes of any kind, interim

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1certificates, refunding bonds, or any other evidence of
2obligation for borrowed money issued under this Section. Bonds
3may be issued in one or more series and may be payable and
4secured either on a parity with or separately from other bonds.
5 (b) The bonds of the Authority shall be payable from one or
6more of the following sources: (i) the property or revenues of
7the Authority; (ii) revenues derived from the casino; (iii)
8revenues derived from any casino operator licensee; (iv) fees,
9bid proceeds, charges, lease payments, payments required
10pursuant to any casino management contract or other revenues
11payable to the Authority, or any receipts of the Authority; (v)
12payments by financial institutions, insurance companies, or
13others pursuant to letters or lines of credit, policies of
14insurance, or purchase agreements; (vi) investment earnings
15from funds or accounts maintained pursuant to a bond resolution
16or trust indenture; (vii) proceeds of refunding bonds; (viii)
17any other revenues derived from or payments by the City; and
18(ix) any payments by any casino operator licensee or others
19pursuant to any guaranty agreement.
20 (c) Bonds shall be authorized by a resolution of the
21Authority and may be secured by a trust indenture by and
22between the Authority and a corporate trustee or trustees,
23which may be any trust company or bank having the powers of a
24trust company within or without the State. Bonds shall meet the
25following requirements:
26 (1) Bonds may bear interest payable at any time or

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1 times and at any rate or rates, notwithstanding any other
2 provision of law to the contrary, and may be subject to
3 such other terms and conditions as may be provided by the
4 resolution or indenture authorizing the issuance of such
5 bonds.
6 (2) Bonds issued pursuant to this Section may be
7 payable on such dates and times as may be provided for by
8 the resolution or indenture authorizing the issuance of
9 such bonds; provided, however, that such bonds shall mature
10 no later than 30 years from the date of issuance.
11 (3) Bonds issued pursuant to this Section may be sold
12 pursuant to notice of sale and public bid or by negotiated
13 sale.
14 (4) Bonds shall be payable at a time or times, in the
15 denominations and form, including book entry form, either
16 coupon, registered, or both, and carry the registration and
17 privileges as to exchange, transfer or conversion, and
18 replacement of mutilated, lost, or destroyed bonds as the
19 resolution or trust indenture may provide.
20 (5) Bonds shall be payable in lawful money of the
21 United States at a designated place.
22 (6) Bonds shall be subject to the terms of purchase,
23 payment, redemption, refunding, or refinancing that the
24 resolution or trust indenture provides.
25 (7) Bonds shall be executed by the manual or facsimile
26 signatures of the officers of the Authority designated by

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1 the Board, which signatures shall be valid at delivery even
2 for one who has ceased to hold office.
3 (8) Bonds shall be sold at public or private sale in
4 the manner and upon the terms determined by the Authority.
5 (9) Bonds shall be issued in accordance with the
6 provisions of the Local Government Debt Reform Act.
7 (d) The Authority shall adopt a procurement program with
8respect to contracts relating to underwriters, bond counsel,
9financial advisors, and accountants. The program shall include
10goals for the payment of not less than 30% of the total dollar
11value of the fees from these contracts to minority-owned
12businesses and female-owned businesses as defined in the
13Business Enterprise for Minorities, Females, and Persons with
14Disabilities Act. The Authority shall conduct outreach to
15minority-owned businesses and female-owned businesses.
16Outreach shall include, but is not limited to, advertisements
17in periodicals and newspapers, mailings, and other appropriate
18media. The Authority shall submit to the General Assembly a
19comprehensive report that shall include, at a minimum, the
20details of the procurement plan, outreach efforts, and the
21results of the efforts to achieve goals for the payment of
22fees.
23 (e) Subject to the Illinois Gambling Act and rules of the
24Gaming Board regarding pledging of interests in holders of
25owners licenses, any resolution or trust indenture may contain
26provisions that may be a part of the contract with the holders

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1of the bonds as to the following:
2 (1) Pledging, assigning, or directing the use,
3 investment, or disposition of revenues of the Authority or
4 proceeds or benefits of any contract, including without
5 limitation any rights in any casino management contract.
6 (2) The setting aside of loan funding deposits, debt
7 service reserves, replacement or operating reserves, cost
8 of issuance accounts and sinking funds, and the regulation,
9 investment, and disposition thereof.
10 (3) Limitations on the purposes to which or the
11 investments in which the proceeds of sale of any issue of
12 bonds or the Authority's revenues and receipts may be
13 applied or made.
14 (4) Limitations on the issue of additional bonds, the
15 terms upon which additional bonds may be issued and
16 secured, the terms upon which additional bonds may rank on
17 a parity with, or be subordinate or superior to, other
18 bonds.
19 (5) The refunding, advance refunding, or refinancing
20 of outstanding bonds.
21 (6) The procedure, if any, by which the terms of any
22 contract with bondholders may be altered or amended and the
23 amount of bonds and holders of which must consent thereto
24 and the manner in which consent shall be given.
25 (7) Defining the acts or omissions that shall
26 constitute a default in the duties of the Authority to

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1 holders of bonds and providing the rights or remedies of
2 such holders in the event of a default, which may include
3 provisions restricting individual rights of action by
4 bondholders.
5 (8) Providing for guarantees, pledges of property,
6 letters of credit, or other security, or insurance for the
7 benefit of bondholders.
8 (f) No member of the Casino Board, nor any person executing
9the bonds, shall be liable personally on the bonds or subject
10to any personal liability by reason of the issuance of the
11bonds.
12 (g) The Authority may issue and secure bonds in accordance
13with the provisions of the Local Government Credit Enhancement
14Act.
15 (h) A pledge by the Authority of revenues and receipts as
16security for an issue of bonds or for the performance of its
17obligations under any casino management contract shall be valid
18and binding from the time when the pledge is made. The revenues
19and receipts pledged shall immediately be subject to the lien
20of the pledge without any physical delivery or further act, and
21the lien of any pledge shall be valid and binding against any
22person having any claim of any kind in tort, contract, or
23otherwise against the Authority, irrespective of whether the
24person has notice. No resolution, trust indenture, management
25agreement or financing statement, continuation statement, or
26other instrument adopted or entered into by the Authority need

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1be filed or recorded in any public record other than the
2records of the Authority in order to perfect the lien against
3third persons, regardless of any contrary provision of law.
4 (i) Bonds that are being paid or retired by issuance, sale,
5or delivery of bonds, and bonds for which sufficient funds have
6been deposited with the paying agent or trustee to provide for
7payment of principal and interest thereon, and any redemption
8premium, as provided in the authorizing resolution, shall not
9be considered outstanding for the purposes of this subsection.
10 (j) The bonds of the Authority shall not be indebtedness of
11the State. The bonds of the Authority are not general
12obligations of the State and are not secured by a pledge of the
13full faith and credit of the State and the holders of bonds of
14the Authority may not require the application of State revenues
15or funds to the payment of bonds of the Authority. The
16foregoing non-recourse language must be printed in bold-face
17type on the face of the bonds and in the preliminary and final
18official statements on the bonds.
19 (k) The State of Illinois pledges and agrees with the
20owners of the bonds that it will not limit or alter the rights
21and powers vested in the Authority by this Act so as to impair
22the terms of any contract made by the Authority with the owners
23or in any way impair the rights and remedies of the owners
24until the bonds, together with interest on them, and all costs
25and expenses in connection with any action or proceedings by or
26on behalf of the owners, are fully met and discharged. The

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1Authority is authorized to include this pledge and agreement in
2any contract with the owners of bonds issued under this
3Section.
4 (l) No person holding an elective office in the City, in
5Cook County, or in this State, holding a seat in the General
6Assembly, or serving as a board member, trustee, officer, or
7employee of the Authority, including the spouse of that person,
8may receive a legal, banking, consulting, or other fee related
9to the issuance of bonds. This prohibition shall also apply to
10a company or firm that employs a person holding an elective
11office in the City, in Cook County, or in this State, holding a
12seat in the General Assembly, or serving as a board member,
13trustee, officer, or employee of the Authority, including the
14spouse of that person, if the person or his or her spouse has
15greater than 7.5% ownership of the company or firm.
16 Section 1-85. Derivative products. With respect to all or
17part of any issue of its bonds, the Authority may enter into
18agreements or contracts with any necessary or appropriate
19person, which will have the benefit of providing to the
20Authority an interest rate basis, cash flow basis, or other
21basis different from that provided in the bonds for the payment
22of interest. Such agreements or contracts may include, without
23limitation, agreements or contracts commonly known as
24"interest rate swap agreements", "forward payment conversion
25agreements", "futures", "options", "puts", or "calls" and

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1agreements or contracts providing for payments based on levels
2of or changes in interest rates, agreements or contracts to
3exchange cash flows or a series of payments, or to hedge
4payment, rate spread, or similar exposure. Any such agreement
5or contract shall be solely an obligation or indebtedness of
6the Authority and shall not be an obligation or indebtedness of
7the State, nor shall any party thereto have any recourse
8against the State in connection with the agreement or contract.
9 Section 1-90. Legality for investment. The State of
10Illinois, all governmental entities, all public officers,
11banks, bankers, trust companies, savings banks and
12institutions, building and loan associations, savings and loan
13associations, investment companies, and other persons carrying
14on a banking business, insurance companies, insurance
15associations, and other persons carrying on an insurance
16business, and all executors, administrators, guardians,
17trustees, and other fiduciaries may legally invest any sinking
18funds, moneys, or other funds belonging to them or within their
19control in any bonds issued under this Act. However, nothing in
20this Section shall be construed as relieving any person or
21entity from any duty of exercising reasonable care in selecting
22securities for purchase or investment.
23 Section 1-105. Budgets and reporting.
24 (a) The Casino Board shall annually adopt a budget for each

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1fiscal year. The budget may be modified from time to time in
2the same manner and upon the same vote as it may be adopted.
3The budget shall include the Authority's available funds and
4estimated revenues and shall provide for payment of its
5obligations and estimated expenditures for the fiscal year,
6including, without limitation, expenditures for
7administration, operation, maintenance and repairs, debt
8service, and deposits into reserve and other funds and capital
9projects.
10 (b) The Casino Board shall annually cause the finances of
11the Authority to be audited by a firm of certified public
12accountants selected by the Casino Board in accordance with the
13rules of the Gaming Board and post on the Authority's Internet
14website such financial information as is required to be posted
15by all other owners licensees under the Illinois Gambling Act.
16 (c) The Casino Board shall, for each fiscal year, prepare
17an annual report setting forth information concerning its
18activities in the fiscal year and the status of the development
19of the casino. The annual report shall include financial
20information of the Authority consistent with that which is
21required for all other owners licensees under the Illinois
22Gambling Act, the budget for the succeeding fiscal year, and
23the current capital plan as of the date of the report. Copies
24of the annual report shall be made available to persons who
25request them and shall be submitted not later than 120 days
26after the end of the Authority's fiscal year or, if the audit

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1of the Authority's financial statements is not completed within
2120 days after the end of the Authority's fiscal year, as soon
3as practical after completion of the audit, to the Governor,
4the Mayor, the General Assembly, and the Commission on
5Government Forecasting and Accountability.
6 Section 1-110. Deposit and withdrawal of funds.
7 (a) All funds deposited by the Authority in any bank or
8savings and loan association shall be placed in the name of the
9Authority and shall be withdrawn or paid out only by check or
10draft upon the bank or savings and loan association, signed by
112 officers or employees designated by the Casino Board.
12Notwithstanding any other provision of this Section, the Casino
13Board may designate any of its members or any officer or
14employee of the Authority to authorize the wire transfer of
15funds deposited by the secretary-treasurer of funds in a bank
16or savings and loan association for the payment of payroll and
17employee benefits-related expenses.
18 No bank or savings and loan association shall receive
19public funds as permitted by this Section unless it has
20complied with the requirements established pursuant to Section
216 of the Public Funds Investment Act.
22 (b) If any officer or employee whose signature appears upon
23any check or draft issued pursuant to this Act ceases (after
24attaching his signature) to hold his or her office before the
25delivery of such a check or draft to the payee, his or her

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1signature shall nevertheless be valid and sufficient for all
2purposes with the same effect as if he or she had remained in
3office until delivery thereof.
4 Section 1-112. Contracts with the Authority or casino
5operator licensee; disclosure requirements.
6 (a) A bidder, respondent, offeror, or contractor for
7contracts with the Authority or casino operator licensee shall
8disclose the identity of all officers and directors and every
9owner, beneficiary, or person with beneficial interest of more
10than 1% or shareholder entitled to receive more than 1% of the
11total distributable income of any corporation having any
12interest in the contract or in the bidder, respondent, offeror,
13or contractor. The disclosure shall be in writing and attested
14to by an owner, trustee, corporate official, or agent. If stock
15in a corporation is publicly traded and there is no readily
16known individual having greater than a 1% interest, then a
17statement to that effect attested to by an officer or agent of
18the corporation shall fulfill the disclosure statement
19requirement of this Section. A bidder, respondent, offeror, or
20contractor shall notify the Authority of any changes in
21officers, directors, ownership, or individuals having a
22beneficial interest of more than 1%. Notwithstanding the
23provisions of this subsection (a), the Gaming Board may adopt
24rules in connection with contractors for contracts with the
25Authority or the casino operator licensee.

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1 (b) A bidder, respondent, offeror, or contractor for
2contracts with an annual value of $25,000 or more or for a
3period to exceed one year shall disclose all political
4contributions of the bidder, respondent, offeror, or
5contractor and any affiliated person or entity. Disclosure
6shall include at least the names and addresses of the
7contributors and the dollar amounts of any contributions to any
8political committee made within the previous 2 years. The
9disclosure must be submitted to the Gaming Board with a copy of
10the contract. All such disclosures shall be posted on the
11websites of the Authority and the Gaming Board.
12 (c) As used in this Section:
13 "Contribution" means contribution as defined in Section
149-1.4 of the Election Code.
15 "Affiliated person" means (i) any person with any ownership
16interest or distributive share of the bidding, responding, or
17contracting entity in excess of 1%, (ii) executive employees of
18the bidding, responding, or contracting entity, and (iii) the
19spouse, minor children, and parents of any such persons.
20 "Affiliated entity" means (i) any parent or subsidiary of
21the bidding or contracting entity, (ii) any member of the same
22unitary business group, or (iii) any political committee for
23which the bidding, responding, or contracting entity is the
24sponsoring entity.
25 (d) The Gaming Board may direct the Authority or a casino
26operator licensee to void a contract if a violation of this

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1Section occurs. The Authority may direct a casino operator
2licensee to void a contract if a violation of this Section
3occurs.
4 (e) All contracts pertaining to the actual operation of the
5casino and related gaming activities shall be entered into by
6the casino operator licensee and not the Authority and shall be
7subject to the regulation, oversight, and approval of the
8Gaming Board, applying the same regulation, oversight, and
9approval requirements as would be applied to any other owners
10licensee under the Illinois Gambling Act.
11 Section 1-115. Purchasing.
12 (a) The Casino Board shall designate an officer of the
13Authority to serve as the Chief Procurement Officer for the
14Authority. The Chief Procurement Officer shall have all powers
15and duties set forth in Section 15 of Division 10 of Article 8
16of the Illinois Municipal Code. Except as otherwise provided in
17this Section, the Chief Procurement Officer of the Authority
18shall conduct procurements on behalf of the Authority subject
19to Title 2, Chapter 92 of the Municipal Code of Chicago, which
20by its terms incorporates Division 10 of Article 8 of the
21Illinois Municipal Code.
22 (b) All contracts for amounts greater than $25,000 must be
23approved by the Casino Board and executed by the chairperson of
24the Casino Board and executive director of the Authority.
25Contracts for amounts of $25,000 or less may be approved and

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1executed by the Chief Procurement Officer for the Authority and
2executive director of the Authority, with approval by the chief
3legal counsel for the Authority as to form and legality.
4 (c) All construction contracts and contracts for supplies,
5materials, equipment, and services for amounts greater than
6$25,000 shall be let by a competitive selection process to the
7lowest responsible proposer, after advertising for proposals,
8except for the following:
9 (1) when repair parts, accessories, equipment, or
10 services are required for equipment or services previously
11 furnished or contracted for;
12 (2) when services such as water, light, heat, power,
13 telephone (other than long-distance service), or telegraph
14 are required;
15 (3) casino management contracts, which shall be
16 awarded as set forth in Section 1-45 of this Act;
17 (4) contracts where there is only one economically
18 feasible source;
19 (5) when a purchase is needed on an immediate,
20 emergency basis because there exists a threat to public
21 health or public safety, or when immediate expenditure is
22 necessary for repairs to Authority property in order to
23 protect against further loss of or damage to Authority
24 property, to prevent or minimize serious disruption in
25 Authority services or to ensure the integrity of Authority
26 records;

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1 (6) contracts for professional services other than for
2 management of the casino, except such contracts described
3 in subsection (d) of this Section; and
4 (7) contracts for the use, purchase, delivery,
5 movement, or installation of (i) data processing
6 equipment, software, and services and (ii)
7 telecommunications equipment, software, and services.
8 (d) Contracts for professional services for a term of more
9than one year or contracts that may require payment in excess
10of $25,000 in one year shall be let by a competitive bidding
11process to the most highly qualified firm that agrees to
12compensation and other terms of engagement that are both
13reasonable and acceptable to the Casino Board.
14 (e) All contracts involving less than $25,000 shall be let
15by competitive selection process whenever possible, and in any
16event in a manner calculated to ensure the best interests of
17the public.
18 (f) In determining the responsibility of any proposer, the
19Authority may take into account the proposer's (or an
20individual having a beneficial interest, directly or
21indirectly, of more than 1% in such proposing entity) past
22record of dealings with the Authority, the proposer's
23experience, adequacy of equipment, and ability to complete
24performance within the time set, and other factors besides
25financial responsibility. No such contract shall be awarded to
26any proposer other than the lowest proposer (in case of

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1purchase or expenditure) unless authorized or approved by a
2vote of at least 3 members of the Casino Board and such action
3is accompanied by a written statement setting forth the reasons
4for not awarding the contract to the highest or lowest
5proposer, as the case may be. The statement shall be kept on
6file in the principal office of the Authority and open to
7public inspection.
8 (g) The Authority shall have the right to reject all
9proposals and to re-advertise for proposals. If after any such
10re-advertisement, no responsible and satisfactory proposals,
11within the terms of the re-advertisement, is received, the
12Authority may award such contract without competitive
13selection. The contract must not be less advantageous to the
14Authority than any valid proposal received pursuant to
15advertisement.
16 (h) Advertisements for proposals and re-proposals shall be
17published at least once in a daily newspaper of general
18circulation published in the City at least 10 calendar days
19before the time for receiving proposals and in an online
20bulletin published on the Authority's website. Such
21advertisements shall state the time and place for receiving and
22opening of proposals and, by reference to plans and
23specifications on file at the time of the first publication or
24in the advertisement itself, shall describe the character of
25the proposed contract in sufficient detail to fully advise
26prospective proposers of their obligations and to ensure free

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1and open competitive selection.
2 (i) All proposals in response to advertisements shall be
3sealed and shall be publicly opened by the Authority. All
4proposers shall be entitled to be present in person or by
5representatives. Cash or a certified or satisfactory cashier's
6check, as a deposit of good faith, in a reasonable amount to be
7fixed by the Authority before advertising for proposals, shall
8be required with the proposal. A bond for faithful performance
9of the contract with surety or sureties satisfactory to the
10Authority and adequate insurance may be required in reasonable
11amounts to be fixed by the Authority before advertising for
12proposals.
13 (j) The contract shall be awarded as promptly as possible
14after the opening of proposals. The proposal of the successful
15proposer, as well as the bids of the unsuccessful proposers,
16shall be placed on file and be open to public inspection
17subject to the exemptions from disclosure provided under
18Section 7 of the Freedom of Information Act. All proposals
19shall be void if any disclosure of the terms of any proposals
20in response to an advertisement is made or permitted to be made
21by the Authority before the time fixed for opening proposals.
22 (k) Notice of each and every contract that is offered,
23including renegotiated contracts and change orders, shall be
24published in an online bulletin. The online bulletin must
25include at least the date first offered, the date submission of
26offers is due, the location that offers are to be submitted to,

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1a brief purchase description, the method of source selection,
2information of how to obtain a comprehensive purchase
3description and any disclosure and contract forms, and
4encouragement to prospective vendors to hire qualified
5veterans, as defined by Section 45-67 of the Illinois
6Procurement Code, and Illinois residents discharged from any
7Illinois adult correctional center subject to Gaming Board
8licensing and eligibility rules. Notice of each and every
9contract that is let or awarded, including renegotiated
10contracts and change orders, shall be published in the online
11bulletin and must include at least all of the information
12specified in this subsection (k), as well as the name of the
13successful responsible proposer or offeror, the contract
14price, and the number of unsuccessful responsive proposers and
15any other disclosure specified in this Section. This notice
16must be posted in the online electronic bulletin prior to
17execution of the contract.
18 Section 1-130. Affirmative action and equal opportunity
19obligations of Authority.
20 (a) The Authority is subject to the requirements of Article
21IV of Chapter 2-92 (Sections 2-92-650 through 2-92-720
22inclusive) of the Chicago Municipal Code, as now or hereafter
23amended, renumbered, or succeeded, concerning a Minority-Owned
24and Women-Owned Business Enterprise Procurement Program for
25construction contracts, and Section 2-92-420 et seq. of the

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1Chicago Municipal Code, as now or hereafter amended,
2renumbered, or succeeded, concerning a Minority-Owned and
3Women-Owned Business Enterprise Procurement Program.
4 (b) The Authority is authorized to enter into agreements
5with contractors' associations, labor unions, and the
6contractors working on the development of the casino to
7establish an apprenticeship preparedness training program to
8provide for an increase in the number of minority and female
9journeymen and apprentices in the building trades and to enter
10into agreements with community college districts or other
11public or private institutions to provide readiness training.
12The Authority is further authorized to enter into contracts
13with public and private educational institutions and persons in
14the gaming, entertainment, hospitality, and tourism industries
15to provide training for employment in those industries.
16 Section 1-135. Transfer of interest. Neither the Authority
17nor the City may sell, lease, rent, transfer, exchange, or
18otherwise convey any interest that they have in the casino
19without prior approval of the Gaming Board and the General
20Assembly.
21 Section 1-140. Home rule. The regulation and licensing of
22casinos and casino gaming, casino gaming facilities, and casino
23operator licensees under this Act are exclusive powers and
24functions of the State. A home rule unit may not regulate or

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1license casinos, casino gaming, casino gaming facilities, or
2casino operator licensees under this Act, except as provided
3under this Act. This Section is a denial and limitation of home
4rule powers and functions under subsection (h) of Section 6 of
5Article VII of the Illinois Constitution.
6 Section 1-145. Prohibition of political contributions from
7casino operator licensees and applicants.
8 (a) The General Assembly has a compelling interest in
9protecting the integrity of both the electoral process and the
10legislative process by preventing corruption and the
11appearance of corruption which may arise through permitting
12certain political campaign contributions by certain persons
13involved in the gaming industry and regulated by the State.
14Unlike most other regulated industries, gaming is especially
15susceptible to corruption and potential criminal influence. In
16Illinois, only licensed gaming activities are legal and all
17other gaming activities are strictly prohibited. Given these
18circumstances, it is imperative to eliminate any potential
19corrupt influence in the gaming industry and the electoral
20process.
21 Banning political campaign contributions by certain
22persons subject to this Section to State officeholders and
23candidates for such offices and to county and municipal
24officeholders and candidates for such offices in counties and
25municipalities that receive financial benefits from gaming

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1activities is necessary to prevent corruption and the
2appearance of corruption that may arise when political campaign
3contributions and gaming that is regulated by the State and
4that confers benefits on counties and municipalities are
5intermingled.
6 The General Assembly has prohibited political campaign
7contributions to certain State and local officeholders and
8candidates for such offices by certain persons with State of
9Illinois and Metropolitan Pier and Exposition Authority
10contracts and pending bids or proposals for contracts of over
11$50,000 and certain individuals and entities affiliated with
12such persons. Certain gaming licensees will receive receipts
13far in excess of the base level of contract amounts subject to
14such other campaign contribution prohibitions.
15 (b) As used in this Section:
16 "Affiliated entity" means (i) any corporate parent and
17operating subsidiary of the business entity applying for or
18holding a license, (ii) each operating subsidiary of the
19corporate parent of the business entity applying for or holding
20a license, (iii) any organization recognized by the United
21States Internal Revenue Service as a tax-exempt organization
22described in Section 501(c) of the Internal Revenue Code of
231986 (or any successor provision of federal tax law)
24established by one or more business entities seeking or holding
25a license, any affiliated entity of such business entity, or
26any affiliated person of such business entity, and (iv) any

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1political committee for which the business entity applying for
2or holding a license, or any 501(c) organization described in
3item (iii) related to that business entity, is the sponsoring
4entity as defined in Section 9-3 of the Election Code. For
5purposes of item (iv), the funding of all business entities
6applying for or holding a license shall be aggregated in
7determining whether such political committee is an affiliated
8entity.
9 "Affiliated person" means (i) any person with any ownership
10interest or distributive share in excess of 7.5% of any
11business entity applying for or holding a license, (ii)
12executive employees of any such business entity, (iii) any
13person designated as a key person under the Illinois Gambling
14Act, and (iv) the spouse of the persons described in items (i)
15through (iii).
16 "Business entity" means any entity doing business for
17profit, whether organized as a corporation, partnership, sole
18proprietorship, limited liability company, or partnership or
19otherwise.
20 "Contribution" means a contribution as defined in Section
219-1.4 of the Election Code.
22 "Declared candidate" means a person who has filed a
23statement of candidacy and petition for nomination or election
24in the principal office of the State Board of Elections, or in
25the office of the appropriate election authority for any county
26or municipality in which a casino is located or proposed or

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1which receives any gaming revenue.
2 "Executive employee" means (i) any person who is an officer
3or director or who fulfills duties equivalent to those of an
4officer or director of a business entity applying for or
5holding a license and (ii) any employee of such business entity
6who is required to register under the Lobbyist Registration
7Act.
8 "License" means the casino operator license issued
9pursuant to this Act.
10 "Officeholder" means the Governor, Lieutenant Governor,
11Attorney General, Secretary of State, Comptroller, Treasurer,
12member of the General Assembly, or any officeholder in any
13county or municipality in which a riverboat, casino, or
14electronic gaming device is located or proposed or that
15receives any gaming revenue.
16 (c) Any person or business entity applying for or holding a
17license, any affiliated entities or persons of such business
18entity, and any entities or persons soliciting a contribution
19or causing a contribution to be made on behalf of such person
20or business entity, are prohibited from making any contribution
21to any officeholder or declared candidate or any political
22committee affiliated with any officeholder or declared
23candidate, as defined in Section 9-1.8 of the Election Code.
24This prohibition shall commence upon filing of an application
25for a license and shall continue for a period of 2 years after
26termination, suspension or revocation of the license.

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1 The Gaming Board shall have authority to suspend, revoke,
2or restrict the license and to impose civil penalties of up to
3$100,000 for each violation of this subsection (c). A notice of
4each such violation and the penalty imposed shall be published
5on the Gaming Board's Internet website and in the Illinois
6Register. Payments received by the State pursuant to this
7subsection (c) shall be deposited into the General Revenue
8Fund.
9 Any officeholder or declared candidate or any political
10committee affiliated with any officeholder or declared
11candidate that has received a contribution in violation of this
12subsection (c) shall pay an amount equal to the value of the
13contribution to the State no more than 30 days after notice of
14the violation concerning the contribution appears in the
15Illinois Register. Payments received by the State pursuant to
16this subsection (c) shall be deposited into the General Revenue
17Fund.
18 (d) The Gaming Board shall post on its Internet website a
19list of all persons, business entities, and affiliated entities
20prohibited from making contributions to any officeholder or
21declared candidate political committee pursuant to subsection
22(c), which list shall be updated and published, at a minimum,
23every 6 months.
24 Any person, business entity, or affiliated entity
25prohibited from making contributions to any officeholder or
26declared candidate political committee pursuant to subsection

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1(c) shall notify the Gaming Board within 7 days after
2discovering any necessary change or addition to the information
3relating to that person, business entity, or affiliated entity
4contained in the list.
5 An individual who acts in good faith and in reliance on any
6information contained in the list shall not be subject to any
7penalties or liability imposed for a violation of this Section.
8 (e) If any provision of this Section is held invalid or its
9application to any person or circumstance is held invalid, the
10invalidity of that provision or application does not affect the
11other provisions or applications of this Section that can be
12given effect without the invalid application or provision.
13
ARTICLE 90.
14 Section 90-1. Findings. The General Assembly makes all of
15the following findings:
16 (1) That the cumulative reduction to pre-K through 12
17 education funding since 2009 is approximately
18 $861,000,000.
19 (2) That during the last 2 years, general state aid to
20 Illinois common schools has been underfunded as a result of
21 budget cuts, resulting in pro-rated payments to school
22 districts that are less than the foundational level of
23 $6,119 per pupil, which represents the minimum each pupil
24 needs to be educated.

09800SB1739ham002- 55 -LRB098 10559 AMC 46792 a
1 (3) That a significant infusion of new revenue is
2 necessary in order to fully fund the foundation level and
3 to maintain and support education in Illinois.
4 (4) That the decline of the Illinois horse racing and
5 breeding program, a $2.5 billion industry, would be
6 reversed if this amendatory Act of the 98th General
7 Assembly would be enacted.
8 (5) That the Illinois horse racing industry is on the
9 verge of extinction due to fierce competition from fully
10 developed horse racing and gaming operations in other
11 states.
12 (6) That allowing the State's horse racing venues,
13 currently licensed gaming destinations, to maximize their
14 capacities with gaming machines, would generate up to $120
15 million to $200 million for the State in the form of extra
16 licensing fees, plus an additional $100 million to $300
17 million in recurring annual tax revenue for the State to
18 help ensure that school, road, and other building projects
19 promised under the capital plan occur on schedule.
20 (7) That Illinois agriculture and other businesses
21 that support and supply the horse racing industry, already
22 a sector that employs over 37,000 Illinoisans, also stand
23 to substantially benefit and would be much more likely to
24 create additional jobs should Illinois horse racing once
25 again become competitive with other states.
26 (8) That by keeping these projects on track, the State

09800SB1739ham002- 56 -LRB098 10559 AMC 46792 a
1 can be sure that significant job and economic growth will
2 in fact result from the previously enacted legislation.
3 (9) That gaming machines at Illinois horse racing
4 tracks would create an estimated 1,200 to 1,500 permanent
5 jobs, and an estimated capital investment of up to $200
6 million to $400 million at these race tracks would prompt
7 additional trade organization jobs necessary to construct
8 new facilities or remodel race tracks to operate electronic
9 gaming.
10 Section 90-3. The State Officials and Employees Ethics Act
11is amended by changing Sections 5-45 and 20-10 as follows:
12 (5 ILCS 430/5-45)
13 Sec. 5-45. Procurement; revolving door prohibition.
14 (a) No former officer, member, or State employee, or spouse
15or immediate family member living with such person, shall,
16within a period of one year immediately after termination of
17State employment, knowingly accept employment or receive
18compensation or fees for services from a person or entity if
19the officer, member, or State employee, during the year
20immediately preceding termination of State employment,
21participated personally and substantially in the award of State
22contracts, or the issuance of State contract change orders,
23with a cumulative value of $25,000 or more to the person or
24entity, or its parent or subsidiary.

09800SB1739ham002- 57 -LRB098 10559 AMC 46792 a
1 (b) No former officer of the executive branch or State
2employee of the executive branch with regulatory or licensing
3authority, or spouse or immediate family member living with
4such person, shall, within a period of one year immediately
5after termination of State employment, knowingly accept
6employment or receive compensation or fees for services from a
7person or entity if the officer or State employee, during the
8year immediately preceding termination of State employment,
9participated personally and substantially in making a
10regulatory or licensing decision that directly applied to the
11person or entity, or its parent or subsidiary.
12 (c) Within 6 months after the effective date of this
13amendatory Act of the 96th General Assembly, each executive
14branch constitutional officer and legislative leader, the
15Auditor General, and the Joint Committee on Legislative Support
16Services shall adopt a policy delineating which State positions
17under his or her jurisdiction and control, by the nature of
18their duties, may have the authority to participate personally
19and substantially in the award of State contracts or in
20regulatory or licensing decisions. The Governor shall adopt
21such a policy for all State employees of the executive branch
22not under the jurisdiction and control of any other executive
23branch constitutional officer.
24 The policies required under subsection (c) of this Section
25shall be filed with the appropriate ethics commission
26established under this Act or, for the Auditor General, with

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1the Office of the Auditor General.
2 (d) Each Inspector General shall have the authority to
3determine that additional State positions under his or her
4jurisdiction, not otherwise subject to the policies required by
5subsection (c) of this Section, are nonetheless subject to the
6notification requirement of subsection (f) below due to their
7involvement in the award of State contracts or in regulatory or
8licensing decisions.
9 (e) The Joint Committee on Legislative Support Services,
10the Auditor General, and each of the executive branch
11constitutional officers and legislative leaders subject to
12subsection (c) of this Section shall provide written
13notification to all employees in positions subject to the
14policies required by subsection (c) or a determination made
15under subsection (d): (1) upon hiring, promotion, or transfer
16into the relevant position; and (2) at the time the employee's
17duties are changed in such a way as to qualify that employee.
18An employee receiving notification must certify in writing that
19the person was advised of the prohibition and the requirement
20to notify the appropriate Inspector General in subsection (f).
21 (f) Any State employee in a position subject to the
22policies required by subsection (c) or to a determination under
23subsection (d), but who does not fall within the prohibition of
24subsection (h) below, who is offered non-State employment
25during State employment or within a period of one year
26immediately after termination of State employment shall, prior

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1to accepting such non-State employment, notify the appropriate
2Inspector General. Within 10 calendar days after receiving
3notification from an employee in a position subject to the
4policies required by subsection (c), such Inspector General
5shall make a determination as to whether the State employee is
6restricted from accepting such employment by subsection (a) or
7(b). In making a determination, in addition to any other
8relevant information, an Inspector General shall assess the
9effect of the prospective employment or relationship upon
10decisions referred to in subsections (a) and (b), based on the
11totality of the participation by the former officer, member, or
12State employee in those decisions. A determination by an
13Inspector General must be in writing, signed and dated by the
14Inspector General, and delivered to the subject of the
15determination within 10 calendar days or the person is deemed
16eligible for the employment opportunity. For purposes of this
17subsection, "appropriate Inspector General" means (i) for
18members and employees of the legislative branch, the
19Legislative Inspector General; (ii) for the Auditor General and
20employees of the Office of the Auditor General, the Inspector
21General provided for in Section 30-5 of this Act; and (iii) for
22executive branch officers and employees, the Inspector General
23having jurisdiction over the officer or employee. Notice of any
24determination of an Inspector General and of any such appeal
25shall be given to the ultimate jurisdictional authority, the
26Attorney General, and the Executive Ethics Commission.

09800SB1739ham002- 60 -LRB098 10559 AMC 46792 a
1 (g) An Inspector General's determination regarding
2restrictions under subsection (a) or (b) may be appealed to the
3appropriate Ethics Commission by the person subject to the
4decision or the Attorney General no later than the 10th
5calendar day after the date of the determination.
6 On appeal, the Ethics Commission or Auditor General shall
7seek, accept, and consider written public comments regarding a
8determination. In deciding whether to uphold an Inspector
9General's determination, the appropriate Ethics Commission or
10Auditor General shall assess, in addition to any other relevant
11information, the effect of the prospective employment or
12relationship upon the decisions referred to in subsections (a)
13and (b), based on the totality of the participation by the
14former officer, member, or State employee in those decisions.
15The Ethics Commission shall decide whether to uphold an
16Inspector General's determination within 10 calendar days or
17the person is deemed eligible for the employment opportunity.
18 (h) The following officers, members, or State employees
19shall not, within a period of one year immediately after
20termination of office or State employment, knowingly accept
21employment or receive compensation or fees for services from a
22person or entity if the person or entity or its parent or
23subsidiary, during the year immediately preceding termination
24of State employment, was a party to a State contract or
25contracts with a cumulative value of $25,000 or more involving
26the officer, member, or State employee's State agency, or was

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1the subject of a regulatory or licensing decision involving the
2officer, member, or State employee's State agency, regardless
3of whether he or she participated personally and substantially
4in the award of the State contract or contracts or the making
5of the regulatory or licensing decision in question:
6 (1) members or officers;
7 (2) members of a commission or board created by the
8 Illinois Constitution;
9 (3) persons whose appointment to office is subject to
10 the advice and consent of the Senate;
11 (4) the head of a department, commission, board,
12 division, bureau, authority, or other administrative unit
13 within the government of this State;
14 (5) chief procurement officers, State purchasing
15 officers, and their designees whose duties are directly
16 related to State procurement; and
17 (6) chiefs of staff, deputy chiefs of staff, associate
18 chiefs of staff, assistant chiefs of staff, and deputy
19 governors; .
20 (7) employees of the Illinois Racing Board; and
21 (8) employees of the Illinois Gaming Board.
22 (i) For the purposes of this Section, with respect to
23officers or employees of a regional transit board, as defined
24in this Act, the phrase "person or entity" does not include:
25(i) the United States government, (ii) the State, (iii)
26municipalities, as defined under Article VII, Section 1 of the

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1Illinois Constitution, (iv) units of local government, as
2defined under Article VII, Section 1 of the Illinois
3Constitution, or (v) school districts.
4(Source: P.A. 96-555, eff. 8-18-09; 97-653, eff. 1-13-12.)
5 (5 ILCS 430/20-10)
6 Sec. 20-10. Offices of Executive Inspectors General.
7 (a) Six Five independent Offices of the Executive Inspector
8General are created, one each for the Governor, the Attorney
9General, the Secretary of State, the Comptroller, and the
10Treasurer and one for gaming activities. Each Office shall be
11under the direction and supervision of an Executive Inspector
12General and shall be a fully independent office with separate
13appropriations.
14 (b) The Governor, Attorney General, Secretary of State,
15Comptroller, and Treasurer shall each appoint an Executive
16Inspector General, and the Governor shall appoint an Executive
17Inspector General for gaming activities. Each appointment must
18be made without regard to political affiliation and solely on
19the basis of integrity and demonstrated ability. Appointments
20shall be made by and with the advice and consent of the Senate
21by three-fifths of the elected members concurring by record
22vote. Any nomination not acted upon by the Senate within 60
23session days of the receipt thereof shall be deemed to have
24received the advice and consent of the Senate. If, during a
25recess of the Senate, there is a vacancy in an office of

09800SB1739ham002- 63 -LRB098 10559 AMC 46792 a
1Executive Inspector General, the appointing authority shall
2make a temporary appointment until the next meeting of the
3Senate when the appointing authority shall make a nomination to
4fill that office. No person rejected for an office of Executive
5Inspector General shall, except by the Senate's request, be
6nominated again for that office at the same session of the
7Senate or be appointed to that office during a recess of that
8Senate.
9 Nothing in this Article precludes the appointment by the
10Governor, Attorney General, Secretary of State, Comptroller,
11or Treasurer of any other inspector general required or
12permitted by law. The Governor, Attorney General, Secretary of
13State, Comptroller, and Treasurer each may appoint an existing
14inspector general as the Executive Inspector General required
15by this Article, provided that such an inspector general is not
16prohibited by law, rule, jurisdiction, qualification, or
17interest from serving as the Executive Inspector General
18required by this Article. An appointing authority may not
19appoint a relative as an Executive Inspector General.
20 Each Executive Inspector General shall have the following
21qualifications:
22 (1) has not been convicted of any felony under the laws
23 of this State, another State, or the United States;
24 (2) has earned a baccalaureate degree from an
25 institution of higher education; and
26 (3) has 5 or more years of cumulative service (A) with

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1 a federal, State, or local law enforcement agency, at least
2 2 years of which have been in a progressive investigatory
3 capacity; (B) as a federal, State, or local prosecutor; (C)
4 as a senior manager or executive of a federal, State, or
5 local agency; (D) as a member, an officer, or a State or
6 federal judge; or (E) representing any combination of (A)
7 through (D).
8 The term of each initial Executive Inspector General shall
9commence upon qualification and shall run through June 30,
102008. The initial appointments shall be made within 60 days
11after the effective date of this Act.
12 After the initial term, each Executive Inspector General
13shall serve for 5-year terms commencing on July 1 of the year
14of appointment and running through June 30 of the fifth
15following year. An Executive Inspector General may be
16reappointed to one or more subsequent terms.
17 A vacancy occurring other than at the end of a term shall
18be filled by the appointing authority only for the balance of
19the term of the Executive Inspector General whose office is
20vacant.
21 Terms shall run regardless of whether the position is
22filled.
23 (c) The Executive Inspector General appointed by the
24Attorney General shall have jurisdiction over the Attorney
25General and all officers and employees of, and vendors and
26others doing business with, State agencies within the

09800SB1739ham002- 65 -LRB098 10559 AMC 46792 a
1jurisdiction of the Attorney General. The Executive Inspector
2General appointed by the Secretary of State shall have
3jurisdiction over the Secretary of State and all officers and
4employees of, and vendors and others doing business with, State
5agencies within the jurisdiction of the Secretary of State. The
6Executive Inspector General appointed by the Comptroller shall
7have jurisdiction over the Comptroller and all officers and
8employees of, and vendors and others doing business with, State
9agencies within the jurisdiction of the Comptroller. The
10Executive Inspector General appointed by the Treasurer shall
11have jurisdiction over the Treasurer and all officers and
12employees of, and vendors and others doing business with, State
13agencies within the jurisdiction of the Treasurer. The
14Executive Inspector General appointed by the Governor shall
15have jurisdiction over (i) the Governor, (ii) the Lieutenant
16Governor, (iii) all officers and employees of, and vendors and
17others doing business with, executive branch State agencies
18under the jurisdiction of the Executive Ethics Commission and
19not within the jurisdiction of the Attorney General, the
20Secretary of State, the Comptroller, or the Treasurer, or the
21Executive Inspector General for gaming activities, and (iv) all
22board members and employees of the Regional Transit Boards and
23all vendors and others doing business with the Regional Transit
24Boards. The Executive Inspector General for gaming activities
25appointed by the Governor has jurisdiction over the Illinois
26Gaming Board, all officers and employees of the Illinois Gaming

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1Board, and all activities of the Illinois Gaming Board.
2 The jurisdiction of each Executive Inspector General is to
3investigate allegations of fraud, waste, abuse, mismanagement,
4misconduct, nonfeasance, misfeasance, malfeasance, or
5violations of this Act or violations of other related laws and
6rules.
7 (d) The compensation for each Executive Inspector General
8shall be determined by the Executive Ethics Commission and
9shall be made from appropriations made to the Comptroller for
10this purpose. Subject to Section 20-45 of this Act, each
11Executive Inspector General has full authority to organize his
12or her Office of the Executive Inspector General, including the
13employment and determination of the compensation of staff, such
14as deputies, assistants, and other employees, as
15appropriations permit. A separate appropriation shall be made
16for each Office of Executive Inspector General.
17 (e) No Executive Inspector General or employee of the
18Office of the Executive Inspector General may, during his or
19her term of appointment or employment:
20 (1) become a candidate for any elective office;
21 (2) hold any other elected or appointed public office
22 except for appointments on governmental advisory boards or
23 study commissions or as otherwise expressly authorized by
24 law;
25 (3) be actively involved in the affairs of any
26 political party or political organization; or

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1 (4) advocate for the appointment of another person to
2 an appointed or elected office or position or actively
3 participate in any campaign for any elective office.
4 In this subsection an appointed public office means a
5position authorized by law that is filled by an appointing
6authority as provided by law and does not include employment by
7hiring in the ordinary course of business.
8 (e-1) No Executive Inspector General or employee of the
9Office of the Executive Inspector General may, for one year
10after the termination of his or her appointment or employment:
11 (1) become a candidate for any elective office;
12 (2) hold any elected public office; or
13 (3) hold any appointed State, county, or local judicial
14 office.
15 (e-2) The requirements of item (3) of subsection (e-1) may
16be waived by the Executive Ethics Commission.
17 (f) An Executive Inspector General may be removed only for
18cause and may be removed only by the appointing constitutional
19officer. At the time of the removal, the appointing
20constitutional officer must report to the Executive Ethics
21Commission the justification for the removal.
22(Source: P.A. 96-555, eff. 8-18-09; 96-1528, eff. 7-1-11.)
23 Section 90-5. The Alcoholism and Other Drug Abuse and
24Dependency Act is amended by changing Section 5-20 as follows:

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1 (20 ILCS 301/5-20)
2 Sec. 5-20. Compulsive gambling program.
3 (a) Subject to appropriation, the Department shall
4establish a program for public education, research, and
5training regarding problem and compulsive gambling and the
6treatment and prevention of problem and compulsive gambling.
7Subject to specific appropriation for these stated purposes,
8the program must include all of the following:
9 (1) Establishment and maintenance of a toll-free "800"
10 telephone number to provide crisis counseling and referral
11 services to families experiencing difficulty as a result of
12 problem or compulsive gambling.
13 (2) Promotion of public awareness regarding the
14 recognition and prevention of problem and compulsive
15 gambling.
16 (3) Facilitation, through in-service training and
17 other means, of the availability of effective assistance
18 programs for problem and compulsive gamblers.
19 (4) Conducting studies to identify adults and
20 juveniles in this State who are, or who are at risk of
21 becoming, problem or compulsive gamblers.
22 (b) Subject to appropriation, the Department shall either
23establish and maintain the program or contract with a private
24or public entity for the establishment and maintenance of the
25program. Subject to appropriation, either the Department or the
26private or public entity shall implement the toll-free

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1telephone number, promote public awareness, and conduct
2in-service training concerning problem and compulsive
3gambling.
4 (c) Subject to appropriation, the Department shall produce
5and supply the signs specified in Section 10.7 of the Illinois
6Lottery Law, Section 34.1 of the Illinois Horse Racing Act of
71975, Section 4.3 of the Bingo License and Tax Act, Section 8.1
8of the Charitable Games Act, and Section 13.1 of the Illinois
9Riverboat Gambling Act.
10(Source: P.A. 89-374, eff. 1-1-96; 89-626, eff. 8-9-96.)
11 Section 90-6. The Department of Commerce and Economic
12Opportunity Law of the Civil Administrative Code of Illinois is
13amended by adding Sections 605-530, 605-535, and 605-540 as
14follows:
15 (20 ILCS 605/605-530 new)
16 Sec. 605-530. The Depressed Communities Economic
17Development Board.
18 (a) The Depressed Communities Economic Development Board
19is created as an advisory board within the Department of
20Commerce and Economic Opportunity. The Board shall consist of
21the following members:
22 (1) 3 members appointed by the Governor, one of whom
23 shall be appointed to serve an initial term of one year and
24 2 of whom shall be appointed to serve an initial term of 2

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1 years;
2 (2) 2 members appointed by the Speaker of the House of
3 Representatives, one of whom shall be appointed to serve an
4 initial term of one year and one of whom shall be appointed
5 to serve an initial term of 2 years;
6 (3) 2 members appointed by the President of the Senate,
7 one of whom shall be appointed to serve an initial term of
8 one year and one of whom shall be appointed to serve an
9 initial term of 2 years;
10 (4) 2 members appointed by the Minority Leader of the
11 House of Representatives, one of whom shall be appointed to
12 serve an initial term of one year and one of whom shall be
13 appointed to serve an initial term of 2 years; and
14 (5) 2 members appointed by the Minority Leader of the
15 Senate, one of whom shall be appointed to serve an initial
16 term of one year and one of whom shall be appointed to
17 serve an initial term of 2 years.
18 The members of the Board shall elect a member to serve as
19chair of the Board. The members of the Board shall reflect the
20composition of the Illinois population with regard to ethnic
21and racial composition.
22 After the initial terms, each member shall be appointed to
23serve a term of 2 years and until his or her successor has been
24appointed and assumes office. If a vacancy occurs in the Board
25membership, then the vacancy shall be filled in the same manner
26as the initial appointment. No member of the Board shall, at

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1the time of his or her appointment or within 2 years before the
2appointment, hold elected office or be appointed to a State
3board, commission, or agency. All Board members are subject to
4the State Officials and Employees Ethics Act.
5 (b) Board members shall serve without compensation, but may
6be reimbursed for their reasonable travel expenses from funds
7available for that purpose. The Department of Commerce and
8Economic Opportunity shall provide staff and administrative
9support services to the Board.
10 (c) The Board must make recommendations, which must be
11approved by a majority of the Board, to the Department of
12Commerce and Economic Opportunity concerning the award of
13grants from amounts appropriated to the Department from the
14Depressed Communities Economic Development Fund, a special
15fund created in the State treasury. The Department must make
16grants to public or private entities submitting proposals to
17the Board to revitalize an Illinois depressed community. Grants
18may be used by these entities only for those purposes
19conditioned with the grant. For the purposes of this subsection
20(c), plans for revitalizing an Illinois depressed community
21include plans intended to curb high levels of poverty,
22unemployment, job and population loss, and general distress. An
23Illinois depressed community is an area where the poverty rate,
24as determined by using the most recent data released by the
25United States Census Bureau, is at least 3% greater than the
26State poverty rate as determined by using the most recent data

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1released by the United States Census Bureau.
2 (20 ILCS 605/605-535 new)
3 Sec. 605-535. The Commission on the Future of Economic
4Development of the Latino Community.
5 (a) There is hereby created the Commission on the Future of
6Economic Development of the Latino Community within the
7Department. The purpose of the Commission shall be to maintain
8and develop the economy of Latinos and to provide opportunities
9for this community, which will enhance and expand the quality
10of their lives.
11 The Commission shall concentrate its major efforts on
12strategic planning, policy research and analysis, advocacy,
13evaluation, and promoting coordination and collaboration.
14 During each regular legislative session, the Commission
15must consult with appropriate legislative committees about the
16State's economic development needs and opportunities in the
17Latino community.
18 By October 1st of each even-numbered year, the Commission
19must submit to the Governor and the General Assembly a biennial
20comprehensive statewide economic development strategy for the
21Latino community with a report on progress from the previous
22comprehensive strategy.
23 The comprehensive statewide economic development strategy
24may include, but is not limited to:
25 (1) an assessment of the Latino community's economic

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1 vitality;
2 (2) recommended goals, objectives, and priorities for
3 the next biennium and the future;
4 (3) a common set of outcomes and benchmarks for the
5 economic development system as a whole for the Latino
6 community;
7 (4) recommendations for removing barriers for Latinos
8 in employment;
9 (5) an inventory of existing relevant programs
10 compiled by the Commission from materials submitted by
11 agencies;
12 (6) recommendations for expanding, discontinuing, or
13 redirecting existing programs or adding new programs to
14 better serve the Latino community; and
15 (7) recommendations of best practices and public and
16 private sector roles in implementing the comprehensive
17 statewide economic development strategy.
18 In developing the biennial statewide economic development
19strategy, goals, objectives, priorities, and recommendations,
20the Commission shall consult, collaborate, and coordinate with
21relevant State agencies, private sector business, nonprofit
22organizations involved in economic development, trade
23associations, associate development organizations, and
24relevant local organizations in order to avoid duplication of
25effort.
26 State agencies shall cooperate with the Commission and

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1provide information as the Commission may reasonably request.
2 The Commission shall review and make budget
3recommendations to the Governor's Office of Management and
4Budget and the General Assembly in areas relating to the
5economic development in the State's Latino community.
6 The Commission shall evaluate its own performance on a
7regular basis.
8 The Commission may accept gifts, grants, donations,
9sponsorships, or contributions from any federal, State, or
10local governmental agency or program, or any private source,
11and expend the same for any purpose consistent with this
12Section.
13 (b) The Commission shall consist of 12 voting members,
14appointed by the Governor, 4 of whom shall be appointed to
15serve an initial term of one year, 4 of whom shall be appointed
16to serve an initial term of 2 years, and 4 of whom shall be
17appointed to serve an initial term of 3 years. After the
18initial term, each member shall be appointed to a term of 3
19years. Members of the Commission shall serve at the pleasure of
20the Governor for not more than 2 consecutive 3-year terms. In
21appointing members, the Governor shall appoint individuals
22from the following private industry sectors:
23 (1) production agriculture;
24 (2) at least 2 individuals from manufacturing, one of
25 whom shall represent a company with no more than 75
26 employees;

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1 (3) transportation, construction, and logistics;
2 (4) travel and tourism;
3 (5) financial services and insurance;
4 (6) information technology and communications; and
5 (7) biotechnology.
6 The members of the Commission shall choose a member to
7serve as chair of the Commission. The members of the Commission
8shall be representative, to the extent possible, of the various
9geographic areas of the State. The Director shall serve as an
10ad hoc nonvoting member of the Commission. Vacancies shall be
11filled in the same manner as the original appointments. The
12members of the Commission shall serve without compensation.
13 (c) The Commission shall meet at least 4 times per year,
14with at least one meeting each calendar quarter, at the call of
15the director or 4 voting members of the Commission. The staff
16and support for the Commission shall be provided by the
17Department.
18 (d) The Commission and Department are encouraged to involve
19other essential groups in the work of the Commission,
20including, but not limited to:
21 (1) public universities;
22 (2) community colleges;
23 (3) other educational institutions; and
24 (4) the Department of Labor.
25 (e) The Commission shall make recommendations, which must
26be approved by a majority of the members of the Commission, to

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1the Department concerning the award of grants from amounts
2appropriated to the Department from the Latino Community
3Economic Development Fund, a special fund in the State
4treasury. The Department shall make grants to public or private
5entities submitting proposals to the Commission to assist in
6the economic development of the Latino community. Grants may be
7used by these entities only for those purposes conditioned with
8the grant. The Commission shall coordinate with the Department
9to develop grant criteria.
10 (f) For the purposes of this Section:
11 "Department" means the Department of Commerce and Economic
12Opportunity.
13 "Director" means the Director of Commerce and Economic
14Opportunity.
15 "Educational institutions" means nonprofit public and
16private colleges, community colleges, State colleges, and
17universities in this State.
18 (20 ILCS 605/605-540 new)
19 Sec. 605-540. The Commission on the Future of Economic
20Development of the African American Community.
21 (a) There is hereby created the Commission on the Future of
22Economic Development of the African American Community within
23the Department. The purpose of the Commission shall be to
24maintain and develop the economy of African Americans and to
25provide opportunities for this community, which will enhance

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1and expand the quality of their lives.
2 The Commission shall concentrate its major efforts on
3strategic planning, policy research and analysis, advocacy,
4evaluation, and promoting coordination and collaboration.
5 During each regular legislative session, the Commission
6must consult with appropriate legislative committees about the
7State's economic development needs and opportunities in the
8African American community.
9 By October 1st of each even-numbered year, the Commission
10must submit to the Governor and the General Assembly a biennial
11comprehensive statewide economic development strategy for the
12African American community with a report on progress from the
13previous comprehensive strategy.
14 The comprehensive statewide economic development strategy
15may include, but is not limited to:
16 (1) an assessment of the African American community's
17 economic vitality;
18 (2) recommended goals, objectives, and priorities for
19 the next biennium and the future;
20 (3) a common set of outcomes and benchmarks for the
21 economic development system as a whole for the African
22 American community;
23 (4) recommendations for removing barriers for African
24 Americans in employment;
25 (5) an inventory of existing relevant programs
26 compiled by the Commission from materials submitted by

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1 agencies;
2 (6) recommendations for expanding, discontinuing, or
3 redirecting existing programs or adding new programs to
4 better serve the African American community; and
5 (7) recommendations of best practices and public and
6 private sector roles in implementing the comprehensive
7 statewide economic development strategy.
8 In developing the biennial statewide economic development
9strategy, goals, objectives, priorities, and recommendations,
10the Commission shall consult, collaborate, and coordinate with
11relevant State agencies, private sector business, nonprofit
12organizations involved in economic development, trade
13associations, associate development organizations, and
14relevant local organizations in order to avoid duplication of
15effort.
16 State agencies shall cooperate with the Commission and
17provide information as the Commission may reasonably request.
18 The Commission shall review and make budget
19recommendations to the Governor's Office of Management and
20Budget and the General Assembly in areas relating to the
21economic development in the State's African American
22community.
23 The Commission shall evaluate its own performance on a
24regular basis.
25 The Commission may accept gifts, grants, donations,
26sponsorships, or contributions from any federal, State, or

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1local governmental agency or program, or any private source,
2and expend the same for any purpose consistent with this
3Section.
4 (b) The Commission shall consist of 12 voting members,
5appointed by the Governor, 4 of whom shall be appointed to
6serve an initial term of one year, 4 of whom shall be appointed
7to serve an initial term of 2 years, and 4 of whom shall be
8appointed to serve an initial term of 3 years. After the
9initial term, each member shall be appointed to a term of 3
10years. Members of the Commission shall serve at the pleasure of
11the Governor for not more than 2 consecutive 3-year terms. In
12appointing members, the Governor shall appoint individuals
13from the following private industry sectors:
14 (1) energy;
15 (2) at least 2 individuals from manufacturing, one of
16 whom shall represent a company with no more than 75
17 employees;
18 (3) transportation, construction, and logistics;
19 (4) travel and tourism;
20 (5) financial services and insurance;
21 (6) information technology and communications;
22 (7) biotechnology; and
23 (8) a member of the Illinois Black Chamber of Commerce.
24 The members of the Commission shall choose a member to
25serve as chair of the Commission. The members of the Commission
26shall be representative, to the extent possible, of the various

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1geographic areas of the State. The Director shall serve as an
2ad hoc nonvoting member of the Commission. Vacancies shall be
3filled in the same manner as the original appointments. The
4members of the Commission shall serve without compensation.
5 (c) The Commission shall meet at least 4 times per year,
6with at least one meeting each calendar quarter, at the call of
7the Director or 4 voting members of the Commission. The staff
8and support for the Commission shall be provided by the
9Department.
10 (d) The Commission and Department are encouraged to involve
11other essential groups in the work of the Commission,
12including, but not limited to:
13 (1) public universities;
14 (2) community colleges;
15 (3) other educational institutions; and
16 (4) the Department of Labor.
17 (e) The Commission shall make recommendations, which must
18be approved by a majority of the members of the Commission, to
19the Department concerning the award of grants from amounts
20appropriated to the Department from the African American
21Community Economic Development Fund, a special fund in the
22State treasury. The Department shall make grants to public or
23private entities submitting proposals to the Commission to
24assist in the economic development of the African American
25community. Grants may be used by these entities only for those
26purposes conditioned with the grant. The Commission shall

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1coordinate with the Department to develop grant criteria.
2 (f) For the purposes of this Section:
3 "Department" means the Department of Commerce and Economic
4Opportunity.
5 "Director" means the Director of Commerce and Economic
6Opportunity.
7 "Educational institutions" means nonprofit public and
8private colleges, community colleges, State colleges, and
9universities in this State.
10 Section 90-8. The Illinois Lottery Law is amended by
11changing Section 9.1 as follows:
12 (20 ILCS 1605/9.1)
13 Sec. 9.1. Private manager and management agreement.
14 (a) As used in this Section:
15 "Offeror" means a person or group of persons that responds
16to a request for qualifications under this Section.
17 "Request for qualifications" means all materials and
18documents prepared by the Department to solicit the following
19from offerors:
20 (1) Statements of qualifications.
21 (2) Proposals to enter into a management agreement,
22 including the identity of any prospective vendor or vendors
23 that the offeror intends to initially engage to assist the
24 offeror in performing its obligations under the management

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1 agreement.
2 "Final offer" means the last proposal submitted by an
3offeror in response to the request for qualifications,
4including the identity of any prospective vendor or vendors
5that the offeror intends to initially engage to assist the
6offeror in performing its obligations under the management
7agreement.
8 "Final offeror" means the offeror ultimately selected by
9the Governor to be the private manager for the Lottery under
10subsection (h) of this Section.
11 (b) By September 15, 2010, the Governor shall select a
12private manager for the total management of the Lottery with
13integrated functions, such as lottery game design, supply of
14goods and services, and advertising and as specified in this
15Section.
16 (c) Pursuant to the terms of this subsection, the
17Department shall endeavor to expeditiously terminate the
18existing contracts in support of the Lottery in effect on the
19effective date of this amendatory Act of the 96th General
20Assembly in connection with the selection of the private
21manager. As part of its obligation to terminate these contracts
22and select the private manager, the Department shall establish
23a mutually agreeable timetable to transfer the functions of
24existing contractors to the private manager so that existing
25Lottery operations are not materially diminished or impaired
26during the transition. To that end, the Department shall do the

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1following:
2 (1) where such contracts contain a provision
3 authorizing termination upon notice, the Department shall
4 provide notice of termination to occur upon the mutually
5 agreed timetable for transfer of functions;
6 (2) upon the expiration of any initial term or renewal
7 term of the current Lottery contracts, the Department shall
8 not renew such contract for a term extending beyond the
9 mutually agreed timetable for transfer of functions; or
10 (3) in the event any current contract provides for
11 termination of that contract upon the implementation of a
12 contract with the private manager, the Department shall
13 perform all necessary actions to terminate the contract on
14 the date that coincides with the mutually agreed timetable
15 for transfer of functions.
16 If the contracts to support the current operation of the
17Lottery in effect on the effective date of this amendatory Act
18of the 96th General Assembly are not subject to termination as
19provided for in this subsection (c), then the Department may
20include a provision in the contract with the private manager
21specifying a mutually agreeable methodology for incorporation.
22 (c-5) The Department shall include provisions in the
23management agreement whereby the private manager shall, for a
24fee, and pursuant to a contract negotiated with the Department
25(the "Employee Use Contract"), utilize the services of current
26Department employees to assist in the administration and

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1operation of the Lottery. The Department shall be the employer
2of all such bargaining unit employees assigned to perform such
3work for the private manager, and such employees shall be State
4employees, as defined by the Personnel Code. Department
5employees shall operate under the same employment policies,
6rules, regulations, and procedures, as other employees of the
7Department. In addition, neither historical representation
8rights under the Illinois Public Labor Relations Act, nor
9existing collective bargaining agreements, shall be disturbed
10by the management agreement with the private manager for the
11management of the Lottery.
12 (d) The management agreement with the private manager shall
13include all of the following:
14 (1) A term not to exceed 10 years, including any
15 renewals.
16 (2) A provision specifying that the Department:
17 (A) shall exercise actual control over all
18 significant business decisions;
19 (A-5) has the authority to direct or countermand
20 operating decisions by the private manager at any time;
21 (B) has ready access at any time to information
22 regarding Lottery operations;
23 (C) has the right to demand and receive information
24 from the private manager concerning any aspect of the
25 Lottery operations at any time; and
26 (D) retains ownership of all trade names,

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1 trademarks, and intellectual property associated with
2 the Lottery.
3 (3) A provision imposing an affirmative duty on the
4 private manager to provide the Department with material
5 information and with any information the private manager
6 reasonably believes the Department would want to know to
7 enable the Department to conduct the Lottery.
8 (4) A provision requiring the private manager to
9 provide the Department with advance notice of any operating
10 decision that bears significantly on the public interest,
11 including, but not limited to, decisions on the kinds of
12 games to be offered to the public and decisions affecting
13 the relative risk and reward of the games being offered, so
14 the Department has a reasonable opportunity to evaluate and
15 countermand that decision.
16 (5) A provision providing for compensation of the
17 private manager that may consist of, among other things, a
18 fee for services and a performance based bonus as
19 consideration for managing the Lottery, including terms
20 that may provide the private manager with an increase in
21 compensation if Lottery revenues grow by a specified
22 percentage in a given year.
23 (6) (Blank).
24 (7) A provision requiring the deposit of all Lottery
25 proceeds to be deposited into the State Lottery Fund except
26 as otherwise provided in Section 20 of this Act.

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1 (8) A provision requiring the private manager to locate
2 its principal office within the State.
3 (8-5) A provision encouraging that at least 20% of the
4 cost of contracts entered into for goods and services by
5 the private manager in connection with its management of
6 the Lottery, other than contracts with sales agents or
7 technical advisors, be awarded to businesses that are a
8 minority owned business, a female owned business, or a
9 business owned by a person with disability, as those terms
10 are defined in the Business Enterprise for Minorities,
11 Females, and Persons with Disabilities Act.
12 (9) A requirement that so long as the private manager
13 complies with all the conditions of the agreement under the
14 oversight of the Department, the private manager shall have
15 the following duties and obligations with respect to the
16 management of the Lottery:
17 (A) The right to use equipment and other assets
18 used in the operation of the Lottery.
19 (B) The rights and obligations under contracts
20 with retailers and vendors.
21 (C) The implementation of a comprehensive security
22 program by the private manager.
23 (D) The implementation of a comprehensive system
24 of internal audits.
25 (E) The implementation of a program by the private
26 manager to curb compulsive gambling by persons playing

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1 the Lottery.
2 (F) A system for determining (i) the type of
3 Lottery games, (ii) the method of selecting winning
4 tickets, (iii) the manner of payment of prizes to
5 holders of winning tickets, (iv) the frequency of
6 drawings of winning tickets, (v) the method to be used
7 in selling tickets, (vi) a system for verifying the
8 validity of tickets claimed to be winning tickets,
9 (vii) the basis upon which retailer commissions are
10 established by the manager, and (viii) minimum
11 payouts.
12 (10) A requirement that advertising and promotion must
13 be consistent with Section 7.8a of this Act.
14 (11) A requirement that the private manager market the
15 Lottery to those residents who are new, infrequent, or
16 lapsed players of the Lottery, especially those who are
17 most likely to make regular purchases on the Internet as
18 permitted by law.
19 (12) A code of ethics for the private manager's
20 officers and employees.
21 (13) A requirement that the Department monitor and
22 oversee the private manager's practices and take action
23 that the Department considers appropriate to ensure that
24 the private manager is in compliance with the terms of the
25 management agreement, while allowing the manager, unless
26 specifically prohibited by law or the management

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1 agreement, to negotiate and sign its own contracts with
2 vendors.
3 (14) A provision requiring the private manager to
4 periodically file, at least on an annual basis, appropriate
5 financial statements in a form and manner acceptable to the
6 Department.
7 (15) Cash reserves requirements.
8 (16) Procedural requirements for obtaining the prior
9 approval of the Department when a management agreement or
10 an interest in a management agreement is sold, assigned,
11 transferred, or pledged as collateral to secure financing.
12 (17) Grounds for the termination of the management
13 agreement by the Department or the private manager.
14 (18) Procedures for amendment of the agreement.
15 (19) A provision requiring the private manager to
16 engage in an open and competitive bidding process for any
17 procurement having a cost in excess of $50,000 that is not
18 a part of the private manager's final offer. The process
19 shall favor the selection of a vendor deemed to have
20 submitted a proposal that provides the Lottery with the
21 best overall value. The process shall not be subject to the
22 provisions of the Illinois Procurement Code, unless
23 specifically required by the management agreement.
24 (20) The transition of rights and obligations,
25 including any associated equipment or other assets used in
26 the operation of the Lottery, from the manager to any

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1 successor manager of the lottery, including the
2 Department, following the termination of or foreclosure
3 upon the management agreement.
4 (21) Right of use of copyrights, trademarks, and
5 service marks held by the Department in the name of the
6 State. The agreement must provide that any use of them by
7 the manager shall only be for the purpose of fulfilling its
8 obligations under the management agreement during the term
9 of the agreement.
10 (22) The disclosure of any information requested by the
11 Department to enable it to comply with the reporting
12 requirements and information requests provided for under
13 subsection (p) of this Section.
14 (e) Notwithstanding any other law to the contrary, the
15Department shall select a private manager through a competitive
16request for qualifications process consistent with Section
1720-35 of the Illinois Procurement Code, which shall take into
18account:
19 (1) the offeror's ability to market the Lottery to
20 those residents who are new, infrequent, or lapsed players
21 of the Lottery, especially those who are most likely to
22 make regular purchases on the Internet;
23 (2) the offeror's ability to address the State's
24 concern with the social effects of gambling on those who
25 can least afford to do so;
26 (3) the offeror's ability to provide the most

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1 successful management of the Lottery for the benefit of the
2 people of the State based on current and past business
3 practices or plans of the offeror; and
4 (4) the offeror's poor or inadequate past performance
5 in servicing, equipping, operating or managing a lottery on
6 behalf of Illinois, another State or foreign government and
7 attracting persons who are not currently regular players of
8 a lottery.
9 (f) The Department may retain the services of an advisor or
10advisors with significant experience in financial services or
11the management, operation, and procurement of goods, services,
12and equipment for a government-run lottery to assist in the
13preparation of the terms of the request for qualifications and
14selection of the private manager. Any prospective advisor
15seeking to provide services under this subsection (f) shall
16disclose any material business or financial relationship
17during the past 3 years with any potential offeror, or with a
18contractor or subcontractor presently providing goods,
19services, or equipment to the Department to support the
20Lottery. The Department shall evaluate the material business or
21financial relationship of each prospective advisor. The
22Department shall not select any prospective advisor with a
23substantial business or financial relationship that the
24Department deems to impair the objectivity of the services to
25be provided by the prospective advisor. During the course of
26the advisor's engagement by the Department, and for a period of

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1one year thereafter, the advisor shall not enter into any
2business or financial relationship with any offeror or any
3vendor identified to assist an offeror in performing its
4obligations under the management agreement. Any advisor
5retained by the Department shall be disqualified from being an
6offeror. The Department shall not include terms in the request
7for qualifications that provide a material advantage whether
8directly or indirectly to any potential offeror, or any
9contractor or subcontractor presently providing goods,
10services, or equipment to the Department to support the
11Lottery, including terms contained in previous responses to
12requests for proposals or qualifications submitted to
13Illinois, another State or foreign government when those terms
14are uniquely associated with a particular potential offeror,
15contractor, or subcontractor. The request for proposals
16offered by the Department on December 22, 2008 as
17"LOT08GAMESYS" and reference number "22016176" is declared
18void.
19 (g) The Department shall select at least 2 offerors as
20finalists to potentially serve as the private manager no later
21than August 9, 2010. Upon making preliminary selections, the
22Department shall schedule a public hearing on the finalists'
23proposals and provide public notice of the hearing at least 7
24calendar days before the hearing. The notice must include all
25of the following:
26 (1) The date, time, and place of the hearing.

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1 (2) The subject matter of the hearing.
2 (3) A brief description of the management agreement to
3 be awarded.
4 (4) The identity of the offerors that have been
5 selected as finalists to serve as the private manager.
6 (5) The address and telephone number of the Department.
7 (h) At the public hearing, the Department shall (i) provide
8sufficient time for each finalist to present and explain its
9proposal to the Department and the Governor or the Governor's
10designee, including an opportunity to respond to questions
11posed by the Department, Governor, or designee and (ii) allow
12the public and non-selected offerors to comment on the
13presentations. The Governor or a designee shall attend the
14public hearing. After the public hearing, the Department shall
15have 14 calendar days to recommend to the Governor whether a
16management agreement should be entered into with a particular
17finalist. After reviewing the Department's recommendation, the
18Governor may accept or reject the Department's recommendation,
19and shall select a final offeror as the private manager by
20publication of a notice in the Illinois Procurement Bulletin on
21or before September 15, 2010. The Governor shall include in the
22notice a detailed explanation and the reasons why the final
23offeror is superior to other offerors and will provide
24management services in a manner that best achieves the
25objectives of this Section. The Governor shall also sign the
26management agreement with the private manager.

09800SB1739ham002- 93 -LRB098 10559 AMC 46792 a
1 (i) Any action to contest the private manager selected by
2the Governor under this Section must be brought within 7
3calendar days after the publication of the notice of the
4designation of the private manager as provided in subsection
5(h) of this Section.
6 (j) The Lottery shall remain, for so long as a private
7manager manages the Lottery in accordance with provisions of
8this Act, a Lottery conducted by the State, and the State shall
9not be authorized to sell or transfer the Lottery to a third
10party.
11 (k) Any tangible personal property used exclusively in
12connection with the lottery that is owned by the Department and
13leased to the private manager shall be owned by the Department
14in the name of the State and shall be considered to be public
15property devoted to an essential public and governmental
16function.
17 (l) The Department may exercise any of its powers under
18this Section or any other law as necessary or desirable for the
19execution of the Department's powers under this Section.
20 (m) Neither this Section nor any management agreement
21entered into under this Section prohibits the General Assembly
22from authorizing forms of gambling that are not in direct
23competition with the Lottery. The forms of gambling authorized
24by this amendatory Act of the 98th General Assembly constitute
25authorized forms of gambling that are not in direct competition
26with the Lottery.

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1 (n) The private manager shall be subject to a complete
2investigation in the third, seventh, and tenth years of the
3agreement (if the agreement is for a 10-year term) by the
4Department in cooperation with the Auditor General to determine
5whether the private manager has complied with this Section and
6the management agreement. The private manager shall bear the
7cost of an investigation or reinvestigation of the private
8manager under this subsection.
9 (o) The powers conferred by this Section are in addition
10and supplemental to the powers conferred by any other law. If
11any other law or rule is inconsistent with this Section,
12including, but not limited to, provisions of the Illinois
13Procurement Code, then this Section controls as to any
14management agreement entered into under this Section. This
15Section and any rules adopted under this Section contain full
16and complete authority for a management agreement between the
17Department and a private manager. No law, procedure,
18proceeding, publication, notice, consent, approval, order, or
19act by the Department or any other officer, Department, agency,
20or instrumentality of the State or any political subdivision is
21required for the Department to enter into a management
22agreement under this Section. This Section contains full and
23complete authority for the Department to approve any contracts
24entered into by a private manager with a vendor providing
25goods, services, or both goods and services to the private
26manager under the terms of the management agreement, including

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1subcontractors of such vendors.
2 Upon receipt of a written request from the Chief
3Procurement Officer, the Department shall provide to the Chief
4Procurement Officer a complete and un-redacted copy of the
5management agreement or any contract that is subject to the
6Department's approval authority under this subsection (o). The
7Department shall provide a copy of the agreement or contract to
8the Chief Procurement Officer in the time specified by the
9Chief Procurement Officer in his or her written request, but no
10later than 5 business days after the request is received by the
11Department. The Chief Procurement Officer must retain any
12portions of the management agreement or of any contract
13designated by the Department as confidential, proprietary, or
14trade secret information in complete confidence pursuant to
15subsection (g) of Section 7 of the Freedom of Information Act.
16The Department shall also provide the Chief Procurement Officer
17with reasonable advance written notice of any contract that is
18pending Department approval.
19 Notwithstanding any other provision of this Section to the
20contrary, the Chief Procurement Officer shall adopt
21administrative rules, including emergency rules, to establish
22a procurement process to select a successor private manager if
23a private management agreement has been terminated. The
24selection process shall at a minimum take into account the
25criteria set forth in items (1) through (4) of subsection (e)
26of this Section and may include provisions consistent with

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1subsections (f), (g), (h), and (i) of this Section. The Chief
2Procurement Officer shall also implement and administer the
3adopted selection process upon the termination of a private
4management agreement. The Department, after the Chief
5Procurement Officer certifies that the procurement process has
6been followed in accordance with the rules adopted under this
7subsection (o), shall select a final offeror as the private
8manager and sign the management agreement with the private
9manager.
10 Except as provided in Sections 21.2, 21.5, 21.6, 21.7, and
1121.8, the Department shall distribute all proceeds of lottery
12tickets and shares sold in the following priority and manner:
13 (1) The payment of prizes and retailer bonuses.
14 (2) The payment of costs incurred in the operation and
15 administration of the Lottery, including the payment of
16 sums due to the private manager under the management
17 agreement with the Department.
18 (3) On the last day of each month or as soon thereafter
19 as possible, the State Comptroller shall direct and the
20 State Treasurer shall transfer from the State Lottery Fund
21 to the Common School Fund an amount that is equal to the
22 proceeds transferred in the corresponding month of fiscal
23 year 2009, as adjusted for inflation, to the Common School
24 Fund.
25 (4) On or before the last day of each fiscal year,
26 deposit any remaining proceeds, subject to payments under

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1 items (1), (2), and (3) into the Capital Projects Fund each
2 fiscal year.
3 (p) The Department shall be subject to the following
4reporting and information request requirements:
5 (1) the Department shall submit written quarterly
6 reports to the Governor and the General Assembly on the
7 activities and actions of the private manager selected
8 under this Section;
9 (2) upon request of the Chief Procurement Officer, the
10 Department shall promptly produce information related to
11 the procurement activities of the Department and the
12 private manager requested by the Chief Procurement
13 Officer; the Chief Procurement Officer must retain
14 confidential, proprietary, or trade secret information
15 designated by the Department in complete confidence
16 pursuant to subsection (g) of Section 7 of the Freedom of
17 Information Act; and
18 (3) at least 30 days prior to the beginning of the
19 Department's fiscal year, the Department shall prepare an
20 annual written report on the activities of the private
21 manager selected under this Section and deliver that report
22 to the Governor and General Assembly.
23(Source: P.A. 96-34, eff. 7-13-09; 96-37, eff. 7-13-09; 96-840,
24eff. 12-23-09; 97-464, eff. 8-19-11; revised 10-17-12.)
25 Section 90-10. The Department of Revenue Law of the Civil

09800SB1739ham002- 98 -LRB098 10559 AMC 46792 a
1Administrative Code of Illinois is amended by changing Section
22505-305 as follows:
3 (20 ILCS 2505/2505-305) (was 20 ILCS 2505/39b15.1)
4 Sec. 2505-305. Investigators.
5 (a) The Department has the power to appoint investigators
6to conduct all investigations, searches, seizures, arrests,
7and other duties imposed under the provisions of any law
8administered by the Department. Except as provided in
9subsection (c), these investigators have and may exercise all
10the powers of peace officers solely for the purpose of
11enforcing taxing measures administered by the Department.
12 (b) The Director must authorize to each investigator
13employed under this Section and to any other employee of the
14Department exercising the powers of a peace officer a distinct
15badge that, on its face, (i) clearly states that the badge is
16authorized by the Department and (ii) contains a unique
17identifying number. No other badge shall be authorized by the
18Department.
19 (c) The Department may enter into agreements with the
20Illinois Gaming Board providing that investigators appointed
21under this Section shall exercise the peace officer powers set
22forth in paragraph (20.6) of subsection (c) of Section 5 of the
23Illinois Riverboat Gambling Act.
24(Source: P.A. 96-37, eff. 7-13-09.)

09800SB1739ham002- 99 -LRB098 10559 AMC 46792 a
1 Section 90-12. The Illinois State Auditing Act is amended
2by changing Section 3-1 as follows:
3 (30 ILCS 5/3-1) (from Ch. 15, par. 303-1)
4 Sec. 3-1. Jurisdiction of Auditor General. The Auditor
5General has jurisdiction over all State agencies to make post
6audits and investigations authorized by or under this Act or
7the Constitution.
8 The Auditor General has jurisdiction over local government
9agencies and private agencies only:
10 (a) to make such post audits authorized by or under
11 this Act as are necessary and incidental to a post audit of
12 a State agency or of a program administered by a State
13 agency involving public funds of the State, but this
14 jurisdiction does not include any authority to review local
15 governmental agencies in the obligation, receipt,
16 expenditure or use of public funds of the State that are
17 granted without limitation or condition imposed by law,
18 other than the general limitation that such funds be used
19 for public purposes;
20 (b) to make investigations authorized by or under this
21 Act or the Constitution; and
22 (c) to make audits of the records of local government
23 agencies to verify actual costs of state-mandated programs
24 when directed to do so by the Legislative Audit Commission
25 at the request of the State Board of Appeals under the

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1 State Mandates Act.
2 In addition to the foregoing, the Auditor General may
3conduct an audit of the Metropolitan Pier and Exposition
4Authority, the Regional Transportation Authority, the Suburban
5Bus Division, the Commuter Rail Division and the Chicago
6Transit Authority and any other subsidized carrier when
7authorized by the Legislative Audit Commission. Such audit may
8be a financial, management or program audit, or any combination
9thereof.
10 The audit shall determine whether they are operating in
11accordance with all applicable laws and regulations. Subject to
12the limitations of this Act, the Legislative Audit Commission
13may by resolution specify additional determinations to be
14included in the scope of the audit.
15 In addition to the foregoing, the Auditor General must also
16conduct a financial audit of the Illinois Sports Facilities
17Authority's expenditures of public funds in connection with the
18reconstruction, renovation, remodeling, extension, or
19improvement of all or substantially all of any existing
20"facility", as that term is defined in the Illinois Sports
21Facilities Authority Act.
22 The Auditor General may also conduct an audit, when
23authorized by the Legislative Audit Commission, of any hospital
24which receives 10% or more of its gross revenues from payments
25from the State of Illinois, Department of Healthcare and Family
26Services (formerly Department of Public Aid), Medical

09800SB1739ham002- 101 -LRB098 10559 AMC 46792 a
1Assistance Program.
2 The Auditor General is authorized to conduct financial and
3compliance audits of the Illinois Distance Learning Foundation
4and the Illinois Conservation Foundation.
5 As soon as practical after the effective date of this
6amendatory Act of 1995, the Auditor General shall conduct a
7compliance and management audit of the City of Chicago and any
8other entity with regard to the operation of Chicago O'Hare
9International Airport, Chicago Midway Airport and Merrill C.
10Meigs Field. The audit shall include, but not be limited to, an
11examination of revenues, expenses, and transfers of funds;
12purchasing and contracting policies and practices; staffing
13levels; and hiring practices and procedures. When completed,
14the audit required by this paragraph shall be distributed in
15accordance with Section 3-14.
16 The Auditor General shall conduct a financial and
17compliance and program audit of distributions from the
18Municipal Economic Development Fund during the immediately
19preceding calendar year pursuant to Section 8-403.1 of the
20Public Utilities Act at no cost to the city, village, or
21incorporated town that received the distributions.
22 The Auditor General must conduct an audit of the Health
23Facilities and Services Review Board pursuant to Section 19.5
24of the Illinois Health Facilities Planning Act.
25 The Auditor General must conduct an audit of the Chicago
26Casino Development Authority pursuant to Section 1-60 of the

09800SB1739ham002- 102 -LRB098 10559 AMC 46792 a
1Chicago Casino Development Authority Act.
2 The Auditor General of the State of Illinois shall annually
3conduct or cause to be conducted a financial and compliance
4audit of the books and records of any county water commission
5organized pursuant to the Water Commission Act of 1985 and
6shall file a copy of the report of that audit with the Governor
7and the Legislative Audit Commission. The filed audit shall be
8open to the public for inspection. The cost of the audit shall
9be charged to the county water commission in accordance with
10Section 6z-27 of the State Finance Act. The county water
11commission shall make available to the Auditor General its
12books and records and any other documentation, whether in the
13possession of its trustees or other parties, necessary to
14conduct the audit required. These audit requirements apply only
15through July 1, 2007.
16 The Auditor General must conduct audits of the Rend Lake
17Conservancy District as provided in Section 25.5 of the River
18Conservancy Districts Act.
19 The Auditor General must conduct financial audits of the
20Southeastern Illinois Economic Development Authority as
21provided in Section 70 of the Southeastern Illinois Economic
22Development Authority Act.
23 The Auditor General shall conduct a compliance audit in
24accordance with subsections (d) and (f) of Section 30 of the
25Innovation Development and Economy Act.
26(Source: P.A. 95-331, eff. 8-21-07; 96-31, eff. 6-30-09;

09800SB1739ham002- 103 -LRB098 10559 AMC 46792 a
196-939, eff. 6-24-10.)
2 Section 90-15. The State Finance Act is amended by adding
3Sections 5.826, 5.829, 5.830, 5.831, 5.832, 5.833, 6z-98,
46z-99, and 6z-100 as follows:
5 (30 ILCS 105/5.826 new)
6 Sec. 5.826. The Gaming Facilities Fee Revenue Fund.
7 (30 ILCS 105/5.829 new)
8 Sec. 5.829. The State Fairgrounds Capital Improvement
9Fund.
10 (30 ILCS 105/5.830 new)
11 Sec. 5.830. The Depressed Communities Economic Development
12Fund.
13 (30 ILCS 105/5.831 new)
14 Sec. 5.831. The Latino Community Economic Development
15Fund.
16 (30 ILCS 105/5.832 new)
17 Sec. 5.832. The African American Community Economic
18Development Fund.
19 (30 ILCS 105/5.833 new)

09800SB1739ham002- 104 -LRB098 10559 AMC 46792 a
1 Sec. 5.833. The Future of Agriculture Fund.
2 (30 ILCS 105/6z-98 new)
3 Sec. 6z-98. The Gaming Facilities Fee Revenue Fund.
4 (a) The Gaming Facilities Fee Revenue Fund is created as a
5special fund in the State treasury.
6 (b) The revenues in the Fund shall be used, subject to
7appropriation, by the Comptroller for the purpose of (i)
8providing appropriations to the Illinois Gaming Board for the
9administration and enforcement of the Illinois Gambling Act and
10the applicable provisions of the Chicago Casino Development
11Authority Act, (ii) providing appropriations to the Illinois
12Racing Board for the administration and enforcement of the
13Illinois Horse Racing Act of 1975, and (iii) payment of
14vouchers that are outstanding for more than 60 days. Whenever
15practical, the Comptroller must prioritize voucher payments
16for expenses related to medical assistance under the Illinois
17Public Aid Code, the Children's Health Insurance Program Act,
18the Covering ALL KIDS Health Insurance Act, and the Senior
19Citizens and Disabled Persons Property Tax Relief and
20Pharmaceutical Assistance Act.
21 (c) The Fund shall consist of fee revenues received
22pursuant to subsection (e) of Section 1-45 of the Chicago
23Casino Development Authority Act and pursuant to subsections
24(e-10), (e-15), (e-25), and (h-5) of Section 7 and subsections
25(b), (c), (d), and (k) of Section 7.6 of the Illinois Gambling

09800SB1739ham002- 105 -LRB098 10559 AMC 46792 a
1Act. All interest earned on moneys in the Fund shall be
2deposited into the Fund.
3 (d) The Fund shall not be subject to administrative charges
4or chargebacks, including, but not limited to, those authorized
5under subsection (h) of Section 8 of this Act.
6 (30 ILCS 105/6z-99 new)
7 Sec. 6z-99. The State Fairgrounds Capital Improvement
8Fund. There is created the State Fairgrounds Capital
9Improvement Fund, a special fund in the State treasury. Moneys
10in the Fund may be used by the Department of Agriculture,
11subject to appropriation, solely for infrastructure
12improvements to the Illinois State Fairgrounds in Sangamon
13County, including, but not limited to, track surfaces (main
14track and practice track), grandstands, audio and visual
15systems, paddocks and barns and associated surface areas,
16restroom facilities on the backstretch, and roadway surfaces
17around the racing facility. In addition, no more than 5% of the
18moneys annually transferred into the Fund may be used by the
19Department for all costs associated with fire protection and
20fire protection services for the Illinois State Fairgrounds.
21The State Fairgrounds Capital Improvement Fund is not subject
22to administrative chargebacks, including, but not limited to,
23those authorized under Section 8h of the State Finance Act.
24 (30 ILCS 105/6z-100 new)

09800SB1739ham002- 106 -LRB098 10559 AMC 46792 a
1 Sec. 6z-100. The Future of Agriculture Fund. There is
2created the Future of Agriculture Fund, a special fund in the
3State treasury. Moneys in the Fund may be used by the
4Department of Agriculture, subject to appropriation, for
5grants to (1) county fairs, as defined by Section 2 of the
6Agricultural Fair Act, (2) the Illinois Association FFA, and
7(3) University of Illinois Extension 4-H programs.
8Additionally, the first $5,000,000 of deposits into the Fund
9shall be used for promotional costs associated with the
10Illinois State Fairgrounds in Sangamon County. The Future of
11Agriculture Fund is not subject to administrative chargebacks,
12including, but not limited to, those authorized under Section
138h of the State Finance Act.
14 Section 90-20. The Illinois Income Tax Act is amended by
15changing Sections 201, 303, 304 and 710 as follows:
16 (35 ILCS 5/201) (from Ch. 120, par. 2-201)
17 Sec. 201. Tax Imposed.
18 (a) In general. A tax measured by net income is hereby
19imposed on every individual, corporation, trust and estate for
20each taxable year ending after July 31, 1969 on the privilege
21of earning or receiving income in or as a resident of this
22State. Such tax shall be in addition to all other occupation or
23privilege taxes imposed by this State or by any municipal
24corporation or political subdivision thereof.

09800SB1739ham002- 107 -LRB098 10559 AMC 46792 a
1 (b) Rates. The tax imposed by subsection (a) of this
2Section shall be determined as follows, except as adjusted by
3subsection (d-1):
4 (1) In the case of an individual, trust or estate, for
5 taxable years ending prior to July 1, 1989, an amount equal
6 to 2 1/2% of the taxpayer's net income for the taxable
7 year.
8 (2) In the case of an individual, trust or estate, for
9 taxable years beginning prior to July 1, 1989 and ending
10 after June 30, 1989, an amount equal to the sum of (i) 2
11 1/2% of the taxpayer's net income for the period prior to
12 July 1, 1989, as calculated under Section 202.3, and (ii)
13 3% of the taxpayer's net income for the period after June
14 30, 1989, as calculated under Section 202.3.
15 (3) In the case of an individual, trust or estate, for
16 taxable years beginning after June 30, 1989, and ending
17 prior to January 1, 2011, an amount equal to 3% of the
18 taxpayer's net income for the taxable year.
19 (4) In the case of an individual, trust, or estate, for
20 taxable years beginning prior to January 1, 2011, and
21 ending after December 31, 2010, an amount equal to the sum
22 of (i) 3% of the taxpayer's net income for the period prior
23 to January 1, 2011, as calculated under Section 202.5, and
24 (ii) 5% of the taxpayer's net income for the period after
25 December 31, 2010, as calculated under Section 202.5.
26 (5) In the case of an individual, trust, or estate, for

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1 taxable years beginning on or after January 1, 2011, and
2 ending prior to January 1, 2015, an amount equal to 5% of
3 the taxpayer's net income for the taxable year.
4 (5.1) In the case of an individual, trust, or estate,
5 for taxable years beginning prior to January 1, 2015, and
6 ending after December 31, 2014, an amount equal to the sum
7 of (i) 5% of the taxpayer's net income for the period prior
8 to January 1, 2015, as calculated under Section 202.5, and
9 (ii) 3.75% of the taxpayer's net income for the period
10 after December 31, 2014, as calculated under Section 202.5.
11 (5.2) In the case of an individual, trust, or estate,
12 for taxable years beginning on or after January 1, 2015,
13 and ending prior to January 1, 2025, an amount equal to
14 3.75% of the taxpayer's net income for the taxable year.
15 (5.3) In the case of an individual, trust, or estate,
16 for taxable years beginning prior to January 1, 2025, and
17 ending after December 31, 2024, an amount equal to the sum
18 of (i) 3.75% of the taxpayer's net income for the period
19 prior to January 1, 2025, as calculated under Section
20 202.5, and (ii) 3.25% of the taxpayer's net income for the
21 period after December 31, 2024, as calculated under Section
22 202.5.
23 (5.4) In the case of an individual, trust, or estate,
24 for taxable years beginning on or after January 1, 2025, an
25 amount equal to 3.25% of the taxpayer's net income for the
26 taxable year.

09800SB1739ham002- 109 -LRB098 10559 AMC 46792 a
1 (6) In the case of a corporation, for taxable years
2 ending prior to July 1, 1989, an amount equal to 4% of the
3 taxpayer's net income for the taxable year.
4 (7) In the case of a corporation, for taxable years
5 beginning prior to July 1, 1989 and ending after June 30,
6 1989, an amount equal to the sum of (i) 4% of the
7 taxpayer's net income for the period prior to July 1, 1989,
8 as calculated under Section 202.3, and (ii) 4.8% of the
9 taxpayer's net income for the period after June 30, 1989,
10 as calculated under Section 202.3.
11 (8) In the case of a corporation, for taxable years
12 beginning after June 30, 1989, and ending prior to January
13 1, 2011, an amount equal to 4.8% of the taxpayer's net
14 income for the taxable year.
15 (9) In the case of a corporation, for taxable years
16 beginning prior to January 1, 2011, and ending after
17 December 31, 2010, an amount equal to the sum of (i) 4.8%
18 of the taxpayer's net income for the period prior to
19 January 1, 2011, as calculated under Section 202.5, and
20 (ii) 7% of the taxpayer's net income for the period after
21 December 31, 2010, as calculated under Section 202.5.
22 (10) In the case of a corporation, for taxable years
23 beginning on or after January 1, 2011, and ending prior to
24 January 1, 2015, an amount equal to 7% of the taxpayer's
25 net income for the taxable year.
26 (11) In the case of a corporation, for taxable years

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1 beginning prior to January 1, 2015, and ending after
2 December 31, 2014, an amount equal to the sum of (i) 7% of
3 the taxpayer's net income for the period prior to January
4 1, 2015, as calculated under Section 202.5, and (ii) 5.25%
5 of the taxpayer's net income for the period after December
6 31, 2014, as calculated under Section 202.5.
7 (12) In the case of a corporation, for taxable years
8 beginning on or after January 1, 2015, and ending prior to
9 January 1, 2025, an amount equal to 5.25% of the taxpayer's
10 net income for the taxable year.
11 (13) In the case of a corporation, for taxable years
12 beginning prior to January 1, 2025, and ending after
13 December 31, 2024, an amount equal to the sum of (i) 5.25%
14 of the taxpayer's net income for the period prior to
15 January 1, 2025, as calculated under Section 202.5, and
16 (ii) 4.8% of the taxpayer's net income for the period after
17 December 31, 2024, as calculated under Section 202.5.
18 (14) In the case of a corporation, for taxable years
19 beginning on or after January 1, 2025, an amount equal to
20 4.8% of the taxpayer's net income for the taxable year.
21 The rates under this subsection (b) are subject to the
22provisions of Section 201.5.
23 (b-5) Surcharge; sale or exchange of assets, properties,
24and intangibles of electronic gaming licensees. For each of
25taxable years 2013 through 2021, a surcharge is imposed on all
26taxpayers on income arising from the sale or exchange of

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1capital assets, depreciable business property, real property
2used in the trade or business, and Section 197 intangibles (i)
3of an organization licensee under the Illinois Horse Racing Act
4of 1975 and (ii) of an electronic gaming licensee under the
5Illinois Gambling Act. The amount of the surcharge is equal to
6the amount of federal income tax liability for the taxable year
7attributable to those sales and exchanges. The surcharge
8imposed shall not apply if:
9 (1) the electronic gaming license, organization
10 license, or race track property is transferred as a result
11 of any of the following:
12 (A) bankruptcy, a receivership, or a debt
13 adjustment initiated by or against the initial
14 licensee or the substantial owners of the initial
15 licensee;
16 (B) cancellation, revocation, or termination of
17 any such license by the Illinois Gaming Board or the
18 Illinois Racing Board;
19 (C) a determination by the Illinois Gaming Board
20 that transfer of the license is in the best interests
21 of Illinois gaming;
22 (D) the death of an owner of the equity interest in
23 a licensee;
24 (E) the acquisition of a controlling interest in
25 the stock or substantially all of the assets of a
26 publicly traded company;

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1 (F) a transfer by a parent company to a wholly
2 owned subsidiary; or
3 (G) the transfer or sale to or by one person to
4 another person where both persons were initial owners
5 of the license when the license was issued; or
6 (2) the controlling interest in the electronic gaming
7 license, organization license, or race track property is
8 transferred in a transaction to lineal descendants in which
9 no gain or loss is recognized or as a result of a
10 transaction in accordance with Section 351 of the Internal
11 Revenue Code in which no gain or loss is recognized; or
12 (3) live horse racing was not conducted in 2011 under a
13 license issued pursuant to the Illinois Horse Racing Act of
14 1975.
15 The transfer of an electronic gaming license, organization
16license, or race track property by a person other than the
17initial licensee to receive the electronic gaming license is
18not subject to a surcharge. The Department shall adopt rules
19necessary to implement and administer this subsection.
20 (c) Personal Property Tax Replacement Income Tax.
21Beginning on July 1, 1979 and thereafter, in addition to such
22income tax, there is also hereby imposed the Personal Property
23Tax Replacement Income Tax measured by net income on every
24corporation (including Subchapter S corporations), partnership
25and trust, for each taxable year ending after June 30, 1979.
26Such taxes are imposed on the privilege of earning or receiving

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1income in or as a resident of this State. The Personal Property
2Tax Replacement Income Tax shall be in addition to the income
3tax imposed by subsections (a) and (b) of this Section and in
4addition to all other occupation or privilege taxes imposed by
5this State or by any municipal corporation or political
6subdivision thereof.
7 (d) Additional Personal Property Tax Replacement Income
8Tax Rates. The personal property tax replacement income tax
9imposed by this subsection and subsection (c) of this Section
10in the case of a corporation, other than a Subchapter S
11corporation and except as adjusted by subsection (d-1), shall
12be an additional amount equal to 2.85% of such taxpayer's net
13income for the taxable year, except that beginning on January
141, 1981, and thereafter, the rate of 2.85% specified in this
15subsection shall be reduced to 2.5%, and in the case of a
16partnership, trust or a Subchapter S corporation shall be an
17additional amount equal to 1.5% of such taxpayer's net income
18for the taxable year.
19 (d-1) Rate reduction for certain foreign insurers. In the
20case of a foreign insurer, as defined by Section 35A-5 of the
21Illinois Insurance Code, whose state or country of domicile
22imposes on insurers domiciled in Illinois a retaliatory tax
23(excluding any insurer whose premiums from reinsurance assumed
24are 50% or more of its total insurance premiums as determined
25under paragraph (2) of subsection (b) of Section 304, except
26that for purposes of this determination premiums from

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1reinsurance do not include premiums from inter-affiliate
2reinsurance arrangements), beginning with taxable years ending
3on or after December 31, 1999, the sum of the rates of tax
4imposed by subsections (b) and (d) shall be reduced (but not
5increased) to the rate at which the total amount of tax imposed
6under this Act, net of all credits allowed under this Act,
7shall equal (i) the total amount of tax that would be imposed
8on the foreign insurer's net income allocable to Illinois for
9the taxable year by such foreign insurer's state or country of
10domicile if that net income were subject to all income taxes
11and taxes measured by net income imposed by such foreign
12insurer's state or country of domicile, net of all credits
13allowed or (ii) a rate of zero if no such tax is imposed on such
14income by the foreign insurer's state of domicile. For the
15purposes of this subsection (d-1), an inter-affiliate includes
16a mutual insurer under common management.
17 (1) For the purposes of subsection (d-1), in no event
18 shall the sum of the rates of tax imposed by subsections
19 (b) and (d) be reduced below the rate at which the sum of:
20 (A) the total amount of tax imposed on such foreign
21 insurer under this Act for a taxable year, net of all
22 credits allowed under this Act, plus
23 (B) the privilege tax imposed by Section 409 of the
24 Illinois Insurance Code, the fire insurance company
25 tax imposed by Section 12 of the Fire Investigation
26 Act, and the fire department taxes imposed under

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1 Section 11-10-1 of the Illinois Municipal Code,
2 equals 1.25% for taxable years ending prior to December 31,
3 2003, or 1.75% for taxable years ending on or after
4 December 31, 2003, of the net taxable premiums written for
5 the taxable year, as described by subsection (1) of Section
6 409 of the Illinois Insurance Code. This paragraph will in
7 no event increase the rates imposed under subsections (b)
8 and (d).
9 (2) Any reduction in the rates of tax imposed by this
10 subsection shall be applied first against the rates imposed
11 by subsection (b) and only after the tax imposed by
12 subsection (a) net of all credits allowed under this
13 Section other than the credit allowed under subsection (i)
14 has been reduced to zero, against the rates imposed by
15 subsection (d).
16 This subsection (d-1) is exempt from the provisions of
17Section 250.
18 (e) Investment credit. A taxpayer shall be allowed a credit
19against the Personal Property Tax Replacement Income Tax for
20investment in qualified property.
21 (1) A taxpayer shall be allowed a credit equal to .5%
22 of the basis of qualified property placed in service during
23 the taxable year, provided such property is placed in
24 service on or after July 1, 1984. There shall be allowed an
25 additional credit equal to .5% of the basis of qualified
26 property placed in service during the taxable year,

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1 provided such property is placed in service on or after
2 July 1, 1986, and the taxpayer's base employment within
3 Illinois has increased by 1% or more over the preceding
4 year as determined by the taxpayer's employment records
5 filed with the Illinois Department of Employment Security.
6 Taxpayers who are new to Illinois shall be deemed to have
7 met the 1% growth in base employment for the first year in
8 which they file employment records with the Illinois
9 Department of Employment Security. The provisions added to
10 this Section by Public Act 85-1200 (and restored by Public
11 Act 87-895) shall be construed as declaratory of existing
12 law and not as a new enactment. If, in any year, the
13 increase in base employment within Illinois over the
14 preceding year is less than 1%, the additional credit shall
15 be limited to that percentage times a fraction, the
16 numerator of which is .5% and the denominator of which is
17 1%, but shall not exceed .5%. The investment credit shall
18 not be allowed to the extent that it would reduce a
19 taxpayer's liability in any tax year below zero, nor may
20 any credit for qualified property be allowed for any year
21 other than the year in which the property was placed in
22 service in Illinois. For tax years ending on or after
23 December 31, 1987, and on or before December 31, 1988, the
24 credit shall be allowed for the tax year in which the
25 property is placed in service, or, if the amount of the
26 credit exceeds the tax liability for that year, whether it

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1 exceeds the original liability or the liability as later
2 amended, such excess may be carried forward and applied to
3 the tax liability of the 5 taxable years following the
4 excess credit years if the taxpayer (i) makes investments
5 which cause the creation of a minimum of 2,000 full-time
6 equivalent jobs in Illinois, (ii) is located in an
7 enterprise zone established pursuant to the Illinois
8 Enterprise Zone Act and (iii) is certified by the
9 Department of Commerce and Community Affairs (now
10 Department of Commerce and Economic Opportunity) as
11 complying with the requirements specified in clause (i) and
12 (ii) by July 1, 1986. The Department of Commerce and
13 Community Affairs (now Department of Commerce and Economic
14 Opportunity) shall notify the Department of Revenue of all
15 such certifications immediately. For tax years ending
16 after December 31, 1988, the credit shall be allowed for
17 the tax year in which the property is placed in service,
18 or, if the amount of the credit exceeds the tax liability
19 for that year, whether it exceeds the original liability or
20 the liability as later amended, such excess may be carried
21 forward and applied to the tax liability of the 5 taxable
22 years following the excess credit years. The credit shall
23 be applied to the earliest year for which there is a
24 liability. If there is credit from more than one tax year
25 that is available to offset a liability, earlier credit
26 shall be applied first.

09800SB1739ham002- 118 -LRB098 10559 AMC 46792 a
1 (2) The term "qualified property" means property
2 which:
3 (A) is tangible, whether new or used, including
4 buildings and structural components of buildings and
5 signs that are real property, but not including land or
6 improvements to real property that are not a structural
7 component of a building such as landscaping, sewer
8 lines, local access roads, fencing, parking lots, and
9 other appurtenances;
10 (B) is depreciable pursuant to Section 167 of the
11 Internal Revenue Code, except that "3-year property"
12 as defined in Section 168(c)(2)(A) of that Code is not
13 eligible for the credit provided by this subsection
14 (e);
15 (C) is acquired by purchase as defined in Section
16 179(d) of the Internal Revenue Code;
17 (D) is used in Illinois by a taxpayer who is
18 primarily engaged in manufacturing, or in mining coal
19 or fluorite, or in retailing, or was placed in service
20 on or after July 1, 2006 in a River Edge Redevelopment
21 Zone established pursuant to the River Edge
22 Redevelopment Zone Act; and
23 (E) has not previously been used in Illinois in
24 such a manner and by such a person as would qualify for
25 the credit provided by this subsection (e) or
26 subsection (f).

09800SB1739ham002- 119 -LRB098 10559 AMC 46792 a
1 (3) For purposes of this subsection (e),
2 "manufacturing" means the material staging and production
3 of tangible personal property by procedures commonly
4 regarded as manufacturing, processing, fabrication, or
5 assembling which changes some existing material into new
6 shapes, new qualities, or new combinations. For purposes of
7 this subsection (e) the term "mining" shall have the same
8 meaning as the term "mining" in Section 613(c) of the
9 Internal Revenue Code. For purposes of this subsection (e),
10 the term "retailing" means the sale of tangible personal
11 property for use or consumption and not for resale, or
12 services rendered in conjunction with the sale of tangible
13 personal property for use or consumption and not for
14 resale. For purposes of this subsection (e), "tangible
15 personal property" has the same meaning as when that term
16 is used in the Retailers' Occupation Tax Act, and, for
17 taxable years ending after December 31, 2008, does not
18 include the generation, transmission, or distribution of
19 electricity.
20 (4) The basis of qualified property shall be the basis
21 used to compute the depreciation deduction for federal
22 income tax purposes.
23 (5) If the basis of the property for federal income tax
24 depreciation purposes is increased after it has been placed
25 in service in Illinois by the taxpayer, the amount of such
26 increase shall be deemed property placed in service on the

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1 date of such increase in basis.
2 (6) The term "placed in service" shall have the same
3 meaning as under Section 46 of the Internal Revenue Code.
4 (7) If during any taxable year, any property ceases to
5 be qualified property in the hands of the taxpayer within
6 48 months after being placed in service, or the situs of
7 any qualified property is moved outside Illinois within 48
8 months after being placed in service, the Personal Property
9 Tax Replacement Income Tax for such taxable year shall be
10 increased. Such increase shall be determined by (i)
11 recomputing the investment credit which would have been
12 allowed for the year in which credit for such property was
13 originally allowed by eliminating such property from such
14 computation and, (ii) subtracting such recomputed credit
15 from the amount of credit previously allowed. For the
16 purposes of this paragraph (7), a reduction of the basis of
17 qualified property resulting from a redetermination of the
18 purchase price shall be deemed a disposition of qualified
19 property to the extent of such reduction.
20 (8) Unless the investment credit is extended by law,
21 the basis of qualified property shall not include costs
22 incurred after December 31, 2018, except for costs incurred
23 pursuant to a binding contract entered into on or before
24 December 31, 2018.
25 (9) Each taxable year ending before December 31, 2000,
26 a partnership may elect to pass through to its partners the

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1 credits to which the partnership is entitled under this
2 subsection (e) for the taxable year. A partner may use the
3 credit allocated to him or her under this paragraph only
4 against the tax imposed in subsections (c) and (d) of this
5 Section. If the partnership makes that election, those
6 credits shall be allocated among the partners in the
7 partnership in accordance with the rules set forth in
8 Section 704(b) of the Internal Revenue Code, and the rules
9 promulgated under that Section, and the allocated amount of
10 the credits shall be allowed to the partners for that
11 taxable year. The partnership shall make this election on
12 its Personal Property Tax Replacement Income Tax return for
13 that taxable year. The election to pass through the credits
14 shall be irrevocable.
15 For taxable years ending on or after December 31, 2000,
16 a partner that qualifies its partnership for a subtraction
17 under subparagraph (I) of paragraph (2) of subsection (d)
18 of Section 203 or a shareholder that qualifies a Subchapter
19 S corporation for a subtraction under subparagraph (S) of
20 paragraph (2) of subsection (b) of Section 203 shall be
21 allowed a credit under this subsection (e) equal to its
22 share of the credit earned under this subsection (e) during
23 the taxable year by the partnership or Subchapter S
24 corporation, determined in accordance with the
25 determination of income and distributive share of income
26 under Sections 702 and 704 and Subchapter S of the Internal

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1 Revenue Code. This paragraph is exempt from the provisions
2 of Section 250.
3 (f) Investment credit; Enterprise Zone; River Edge
4Redevelopment Zone.
5 (1) A taxpayer shall be allowed a credit against the
6 tax imposed by subsections (a) and (b) of this Section for
7 investment in qualified property which is placed in service
8 in an Enterprise Zone created pursuant to the Illinois
9 Enterprise Zone Act or, for property placed in service on
10 or after July 1, 2006, a River Edge Redevelopment Zone
11 established pursuant to the River Edge Redevelopment Zone
12 Act. For partners, shareholders of Subchapter S
13 corporations, and owners of limited liability companies,
14 if the liability company is treated as a partnership for
15 purposes of federal and State income taxation, there shall
16 be allowed a credit under this subsection (f) to be
17 determined in accordance with the determination of income
18 and distributive share of income under Sections 702 and 704
19 and Subchapter S of the Internal Revenue Code. The credit
20 shall be .5% of the basis for such property. The credit
21 shall be available only in the taxable year in which the
22 property is placed in service in the Enterprise Zone or
23 River Edge Redevelopment Zone and shall not be allowed to
24 the extent that it would reduce a taxpayer's liability for
25 the tax imposed by subsections (a) and (b) of this Section
26 to below zero. For tax years ending on or after December

09800SB1739ham002- 123 -LRB098 10559 AMC 46792 a
1 31, 1985, the credit shall be allowed for the tax year in
2 which the property is placed in service, or, if the amount
3 of the credit exceeds the tax liability for that year,
4 whether it exceeds the original liability or the liability
5 as later amended, such excess may be carried forward and
6 applied to the tax liability of the 5 taxable years
7 following the excess credit year. The credit shall be
8 applied to the earliest year for which there is a
9 liability. If there is credit from more than one tax year
10 that is available to offset a liability, the credit
11 accruing first in time shall be applied first.
12 (2) The term qualified property means property which:
13 (A) is tangible, whether new or used, including
14 buildings and structural components of buildings;
15 (B) is depreciable pursuant to Section 167 of the
16 Internal Revenue Code, except that "3-year property"
17 as defined in Section 168(c)(2)(A) of that Code is not
18 eligible for the credit provided by this subsection
19 (f);
20 (C) is acquired by purchase as defined in Section
21 179(d) of the Internal Revenue Code;
22 (D) is used in the Enterprise Zone or River Edge
23 Redevelopment Zone by the taxpayer; and
24 (E) has not been previously used in Illinois in
25 such a manner and by such a person as would qualify for
26 the credit provided by this subsection (f) or

09800SB1739ham002- 124 -LRB098 10559 AMC 46792 a
1 subsection (e).
2 (3) The basis of qualified property shall be the basis
3 used to compute the depreciation deduction for federal
4 income tax purposes.
5 (4) If the basis of the property for federal income tax
6 depreciation purposes is increased after it has been placed
7 in service in the Enterprise Zone or River Edge
8 Redevelopment Zone by the taxpayer, the amount of such
9 increase shall be deemed property placed in service on the
10 date of such increase in basis.
11 (5) The term "placed in service" shall have the same
12 meaning as under Section 46 of the Internal Revenue Code.
13 (6) If during any taxable year, any property ceases to
14 be qualified property in the hands of the taxpayer within
15 48 months after being placed in service, or the situs of
16 any qualified property is moved outside the Enterprise Zone
17 or River Edge Redevelopment Zone within 48 months after
18 being placed in service, the tax imposed under subsections
19 (a) and (b) of this Section for such taxable year shall be
20 increased. Such increase shall be determined by (i)
21 recomputing the investment credit which would have been
22 allowed for the year in which credit for such property was
23 originally allowed by eliminating such property from such
24 computation, and (ii) subtracting such recomputed credit
25 from the amount of credit previously allowed. For the
26 purposes of this paragraph (6), a reduction of the basis of

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1 qualified property resulting from a redetermination of the
2 purchase price shall be deemed a disposition of qualified
3 property to the extent of such reduction.
4 (7) There shall be allowed an additional credit equal
5 to 0.5% of the basis of qualified property placed in
6 service during the taxable year in a River Edge
7 Redevelopment Zone, provided such property is placed in
8 service on or after July 1, 2006, and the taxpayer's base
9 employment within Illinois has increased by 1% or more over
10 the preceding year as determined by the taxpayer's
11 employment records filed with the Illinois Department of
12 Employment Security. Taxpayers who are new to Illinois
13 shall be deemed to have met the 1% growth in base
14 employment for the first year in which they file employment
15 records with the Illinois Department of Employment
16 Security. If, in any year, the increase in base employment
17 within Illinois over the preceding year is less than 1%,
18 the additional credit shall be limited to that percentage
19 times a fraction, the numerator of which is 0.5% and the
20 denominator of which is 1%, but shall not exceed 0.5%.
21 (g) Jobs Tax Credit; River Edge Redevelopment Zone and
22Foreign Trade Zone or Sub-Zone.
23 (1) A taxpayer conducting a trade or business, for
24 taxable years ending on or after December 31, 2006, in a
25 River Edge Redevelopment Zone or conducting a trade or
26 business in a federally designated Foreign Trade Zone or

09800SB1739ham002- 126 -LRB098 10559 AMC 46792 a
1 Sub-Zone shall be allowed a credit against the tax imposed
2 by subsections (a) and (b) of this Section in the amount of
3 $500 per eligible employee hired to work in the zone during
4 the taxable year.
5 (2) To qualify for the credit:
6 (A) the taxpayer must hire 5 or more eligible
7 employees to work in a River Edge Redevelopment Zone or
8 federally designated Foreign Trade Zone or Sub-Zone
9 during the taxable year;
10 (B) the taxpayer's total employment within the
11 River Edge Redevelopment Zone or federally designated
12 Foreign Trade Zone or Sub-Zone must increase by 5 or
13 more full-time employees beyond the total employed in
14 that zone at the end of the previous tax year for which
15 a jobs tax credit under this Section was taken, or
16 beyond the total employed by the taxpayer as of
17 December 31, 1985, whichever is later; and
18 (C) the eligible employees must be employed 180
19 consecutive days in order to be deemed hired for
20 purposes of this subsection.
21 (3) An "eligible employee" means an employee who is:
22 (A) Certified by the Department of Commerce and
23 Economic Opportunity as "eligible for services"
24 pursuant to regulations promulgated in accordance with
25 Title II of the Job Training Partnership Act, Training
26 Services for the Disadvantaged or Title III of the Job

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1 Training Partnership Act, Employment and Training
2 Assistance for Dislocated Workers Program.
3 (B) Hired after the River Edge Redevelopment Zone
4 or federally designated Foreign Trade Zone or Sub-Zone
5 was designated or the trade or business was located in
6 that zone, whichever is later.
7 (C) Employed in the River Edge Redevelopment Zone
8 or Foreign Trade Zone or Sub-Zone. An employee is
9 employed in a federally designated Foreign Trade Zone
10 or Sub-Zone if his services are rendered there or it is
11 the base of operations for the services performed.
12 (D) A full-time employee working 30 or more hours
13 per week.
14 (4) For tax years ending on or after December 31, 1985
15 and prior to December 31, 1988, the credit shall be allowed
16 for the tax year in which the eligible employees are hired.
17 For tax years ending on or after December 31, 1988, the
18 credit shall be allowed for the tax year immediately
19 following the tax year in which the eligible employees are
20 hired. If the amount of the credit exceeds the tax
21 liability for that year, whether it exceeds the original
22 liability or the liability as later amended, such excess
23 may be carried forward and applied to the tax liability of
24 the 5 taxable years following the excess credit year. The
25 credit shall be applied to the earliest year for which
26 there is a liability. If there is credit from more than one

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1 tax year that is available to offset a liability, earlier
2 credit shall be applied first.
3 (5) The Department of Revenue shall promulgate such
4 rules and regulations as may be deemed necessary to carry
5 out the purposes of this subsection (g).
6 (6) The credit shall be available for eligible
7 employees hired on or after January 1, 1986.
8 (h) Investment credit; High Impact Business.
9 (1) Subject to subsections (b) and (b-5) of Section 5.5
10 of the Illinois Enterprise Zone Act, a taxpayer shall be
11 allowed a credit against the tax imposed by subsections (a)
12 and (b) of this Section for investment in qualified
13 property which is placed in service by a Department of
14 Commerce and Economic Opportunity designated High Impact
15 Business. The credit shall be .5% of the basis for such
16 property. The credit shall not be available (i) until the
17 minimum investments in qualified property set forth in
18 subdivision (a)(3)(A) of Section 5.5 of the Illinois
19 Enterprise Zone Act have been satisfied or (ii) until the
20 time authorized in subsection (b-5) of the Illinois
21 Enterprise Zone Act for entities designated as High Impact
22 Businesses under subdivisions (a)(3)(B), (a)(3)(C), and
23 (a)(3)(D) of Section 5.5 of the Illinois Enterprise Zone
24 Act, and shall not be allowed to the extent that it would
25 reduce a taxpayer's liability for the tax imposed by
26 subsections (a) and (b) of this Section to below zero. The

09800SB1739ham002- 129 -LRB098 10559 AMC 46792 a
1 credit applicable to such investments shall be taken in the
2 taxable year in which such investments have been completed.
3 The credit for additional investments beyond the minimum
4 investment by a designated high impact business authorized
5 under subdivision (a)(3)(A) of Section 5.5 of the Illinois
6 Enterprise Zone Act shall be available only in the taxable
7 year in which the property is placed in service and shall
8 not be allowed to the extent that it would reduce a
9 taxpayer's liability for the tax imposed by subsections (a)
10 and (b) of this Section to below zero. For tax years ending
11 on or after December 31, 1987, the credit shall be allowed
12 for the tax year in which the property is placed in
13 service, or, if the amount of the credit exceeds the tax
14 liability for that year, whether it exceeds the original
15 liability or the liability as later amended, such excess
16 may be carried forward and applied to the tax liability of
17 the 5 taxable years following the excess credit year. The
18 credit shall be applied to the earliest year for which
19 there is a liability. If there is credit from more than one
20 tax year that is available to offset a liability, the
21 credit accruing first in time shall be applied first.
22 Changes made in this subdivision (h)(1) by Public Act
23 88-670 restore changes made by Public Act 85-1182 and
24 reflect existing law.
25 (2) The term qualified property means property which:
26 (A) is tangible, whether new or used, including

09800SB1739ham002- 130 -LRB098 10559 AMC 46792 a
1 buildings and structural components of buildings;
2 (B) is depreciable pursuant to Section 167 of the
3 Internal Revenue Code, except that "3-year property"
4 as defined in Section 168(c)(2)(A) of that Code is not
5 eligible for the credit provided by this subsection
6 (h);
7 (C) is acquired by purchase as defined in Section
8 179(d) of the Internal Revenue Code; and
9 (D) is not eligible for the Enterprise Zone
10 Investment Credit provided by subsection (f) of this
11 Section.
12 (3) The basis of qualified property shall be the basis
13 used to compute the depreciation deduction for federal
14 income tax purposes.
15 (4) If the basis of the property for federal income tax
16 depreciation purposes is increased after it has been placed
17 in service in a federally designated Foreign Trade Zone or
18 Sub-Zone located in Illinois by the taxpayer, the amount of
19 such increase shall be deemed property placed in service on
20 the date of such increase in basis.
21 (5) The term "placed in service" shall have the same
22 meaning as under Section 46 of the Internal Revenue Code.
23 (6) If during any taxable year ending on or before
24 December 31, 1996, any property ceases to be qualified
25 property in the hands of the taxpayer within 48 months
26 after being placed in service, or the situs of any

09800SB1739ham002- 131 -LRB098 10559 AMC 46792 a
1 qualified property is moved outside Illinois within 48
2 months after being placed in service, the tax imposed under
3 subsections (a) and (b) of this Section for such taxable
4 year shall be increased. Such increase shall be determined
5 by (i) recomputing the investment credit which would have
6 been allowed for the year in which credit for such property
7 was originally allowed by eliminating such property from
8 such computation, and (ii) subtracting such recomputed
9 credit from the amount of credit previously allowed. For
10 the purposes of this paragraph (6), a reduction of the
11 basis of qualified property resulting from a
12 redetermination of the purchase price shall be deemed a
13 disposition of qualified property to the extent of such
14 reduction.
15 (7) Beginning with tax years ending after December 31,
16 1996, if a taxpayer qualifies for the credit under this
17 subsection (h) and thereby is granted a tax abatement and
18 the taxpayer relocates its entire facility in violation of
19 the explicit terms and length of the contract under Section
20 18-183 of the Property Tax Code, the tax imposed under
21 subsections (a) and (b) of this Section shall be increased
22 for the taxable year in which the taxpayer relocated its
23 facility by an amount equal to the amount of credit
24 received by the taxpayer under this subsection (h).
25 (i) Credit for Personal Property Tax Replacement Income
26Tax. For tax years ending prior to December 31, 2003, a credit

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1shall be allowed against the tax imposed by subsections (a) and
2(b) of this Section for the tax imposed by subsections (c) and
3(d) of this Section. This credit shall be computed by
4multiplying the tax imposed by subsections (c) and (d) of this
5Section by a fraction, the numerator of which is base income
6allocable to Illinois and the denominator of which is Illinois
7base income, and further multiplying the product by the tax
8rate imposed by subsections (a) and (b) of this Section.
9 Any credit earned on or after December 31, 1986 under this
10subsection which is unused in the year the credit is computed
11because it exceeds the tax liability imposed by subsections (a)
12and (b) for that year (whether it exceeds the original
13liability or the liability as later amended) may be carried
14forward and applied to the tax liability imposed by subsections
15(a) and (b) of the 5 taxable years following the excess credit
16year, provided that no credit may be carried forward to any
17year ending on or after December 31, 2003. This credit shall be
18applied first to the earliest year for which there is a
19liability. If there is a credit under this subsection from more
20than one tax year that is available to offset a liability the
21earliest credit arising under this subsection shall be applied
22first.
23 If, during any taxable year ending on or after December 31,
241986, the tax imposed by subsections (c) and (d) of this
25Section for which a taxpayer has claimed a credit under this
26subsection (i) is reduced, the amount of credit for such tax

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1shall also be reduced. Such reduction shall be determined by
2recomputing the credit to take into account the reduced tax
3imposed by subsections (c) and (d). If any portion of the
4reduced amount of credit has been carried to a different
5taxable year, an amended return shall be filed for such taxable
6year to reduce the amount of credit claimed.
7 (j) Training expense credit. Beginning with tax years
8ending on or after December 31, 1986 and prior to December 31,
92003, a taxpayer shall be allowed a credit against the tax
10imposed by subsections (a) and (b) under this Section for all
11amounts paid or accrued, on behalf of all persons employed by
12the taxpayer in Illinois or Illinois residents employed outside
13of Illinois by a taxpayer, for educational or vocational
14training in semi-technical or technical fields or semi-skilled
15or skilled fields, which were deducted from gross income in the
16computation of taxable income. The credit against the tax
17imposed by subsections (a) and (b) shall be 1.6% of such
18training expenses. For partners, shareholders of subchapter S
19corporations, and owners of limited liability companies, if the
20liability company is treated as a partnership for purposes of
21federal and State income taxation, there shall be allowed a
22credit under this subsection (j) to be determined in accordance
23with the determination of income and distributive share of
24income under Sections 702 and 704 and subchapter S of the
25Internal Revenue Code.
26 Any credit allowed under this subsection which is unused in

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1the year the credit is earned may be carried forward to each of
2the 5 taxable years following the year for which the credit is
3first computed until it is used. This credit shall be applied
4first to the earliest year for which there is a liability. If
5there is a credit under this subsection from more than one tax
6year that is available to offset a liability the earliest
7credit arising under this subsection shall be applied first. No
8carryforward credit may be claimed in any tax year ending on or
9after December 31, 2003.
10 (k) Research and development credit. For tax years ending
11after July 1, 1990 and prior to December 31, 2003, and
12beginning again for tax years ending on or after December 31,
132004, and ending prior to January 1, 2016, a taxpayer shall be
14allowed a credit against the tax imposed by subsections (a) and
15(b) of this Section for increasing research activities in this
16State. The credit allowed against the tax imposed by
17subsections (a) and (b) shall be equal to 6 1/2% of the
18qualifying expenditures for increasing research activities in
19this State. For partners, shareholders of subchapter S
20corporations, and owners of limited liability companies, if the
21liability company is treated as a partnership for purposes of
22federal and State income taxation, there shall be allowed a
23credit under this subsection to be determined in accordance
24with the determination of income and distributive share of
25income under Sections 702 and 704 and subchapter S of the
26Internal Revenue Code.

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1 For purposes of this subsection, "qualifying expenditures"
2means the qualifying expenditures as defined for the federal
3credit for increasing research activities which would be
4allowable under Section 41 of the Internal Revenue Code and
5which are conducted in this State, "qualifying expenditures for
6increasing research activities in this State" means the excess
7of qualifying expenditures for the taxable year in which
8incurred over qualifying expenditures for the base period,
9"qualifying expenditures for the base period" means the average
10of the qualifying expenditures for each year in the base
11period, and "base period" means the 3 taxable years immediately
12preceding the taxable year for which the determination is being
13made.
14 Any credit in excess of the tax liability for the taxable
15year may be carried forward. A taxpayer may elect to have the
16unused credit shown on its final completed return carried over
17as a credit against the tax liability for the following 5
18taxable years or until it has been fully used, whichever occurs
19first; provided that no credit earned in a tax year ending
20prior to December 31, 2003 may be carried forward to any year
21ending on or after December 31, 2003.
22 If an unused credit is carried forward to a given year from
232 or more earlier years, that credit arising in the earliest
24year will be applied first against the tax liability for the
25given year. If a tax liability for the given year still
26remains, the credit from the next earliest year will then be

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1applied, and so on, until all credits have been used or no tax
2liability for the given year remains. Any remaining unused
3credit or credits then will be carried forward to the next
4following year in which a tax liability is incurred, except
5that no credit can be carried forward to a year which is more
6than 5 years after the year in which the expense for which the
7credit is given was incurred.
8 No inference shall be drawn from this amendatory Act of the
991st General Assembly in construing this Section for taxable
10years beginning before January 1, 1999.
11 (l) Environmental Remediation Tax Credit.
12 (i) For tax years ending after December 31, 1997 and on
13 or before December 31, 2001, a taxpayer shall be allowed a
14 credit against the tax imposed by subsections (a) and (b)
15 of this Section for certain amounts paid for unreimbursed
16 eligible remediation costs, as specified in this
17 subsection. For purposes of this Section, "unreimbursed
18 eligible remediation costs" means costs approved by the
19 Illinois Environmental Protection Agency ("Agency") under
20 Section 58.14 of the Environmental Protection Act that were
21 paid in performing environmental remediation at a site for
22 which a No Further Remediation Letter was issued by the
23 Agency and recorded under Section 58.10 of the
24 Environmental Protection Act. The credit must be claimed
25 for the taxable year in which Agency approval of the
26 eligible remediation costs is granted. The credit is not

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1 available to any taxpayer if the taxpayer or any related
2 party caused or contributed to, in any material respect, a
3 release of regulated substances on, in, or under the site
4 that was identified and addressed by the remedial action
5 pursuant to the Site Remediation Program of the
6 Environmental Protection Act. After the Pollution Control
7 Board rules are adopted pursuant to the Illinois
8 Administrative Procedure Act for the administration and
9 enforcement of Section 58.9 of the Environmental
10 Protection Act, determinations as to credit availability
11 for purposes of this Section shall be made consistent with
12 those rules. For purposes of this Section, "taxpayer"
13 includes a person whose tax attributes the taxpayer has
14 succeeded to under Section 381 of the Internal Revenue Code
15 and "related party" includes the persons disallowed a
16 deduction for losses by paragraphs (b), (c), and (f)(1) of
17 Section 267 of the Internal Revenue Code by virtue of being
18 a related taxpayer, as well as any of its partners. The
19 credit allowed against the tax imposed by subsections (a)
20 and (b) shall be equal to 25% of the unreimbursed eligible
21 remediation costs in excess of $100,000 per site, except
22 that the $100,000 threshold shall not apply to any site
23 contained in an enterprise zone as determined by the
24 Department of Commerce and Community Affairs (now
25 Department of Commerce and Economic Opportunity). The
26 total credit allowed shall not exceed $40,000 per year with

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1 a maximum total of $150,000 per site. For partners and
2 shareholders of subchapter S corporations, there shall be
3 allowed a credit under this subsection to be determined in
4 accordance with the determination of income and
5 distributive share of income under Sections 702 and 704 and
6 subchapter S of the Internal Revenue Code.
7 (ii) A credit allowed under this subsection that is
8 unused in the year the credit is earned may be carried
9 forward to each of the 5 taxable years following the year
10 for which the credit is first earned until it is used. The
11 term "unused credit" does not include any amounts of
12 unreimbursed eligible remediation costs in excess of the
13 maximum credit per site authorized under paragraph (i).
14 This credit shall be applied first to the earliest year for
15 which there is a liability. If there is a credit under this
16 subsection from more than one tax year that is available to
17 offset a liability, the earliest credit arising under this
18 subsection shall be applied first. A credit allowed under
19 this subsection may be sold to a buyer as part of a sale of
20 all or part of the remediation site for which the credit
21 was granted. The purchaser of a remediation site and the
22 tax credit shall succeed to the unused credit and remaining
23 carry-forward period of the seller. To perfect the
24 transfer, the assignor shall record the transfer in the
25 chain of title for the site and provide written notice to
26 the Director of the Illinois Department of Revenue of the

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1 assignor's intent to sell the remediation site and the
2 amount of the tax credit to be transferred as a portion of
3 the sale. In no event may a credit be transferred to any
4 taxpayer if the taxpayer or a related party would not be
5 eligible under the provisions of subsection (i).
6 (iii) For purposes of this Section, the term "site"
7 shall have the same meaning as under Section 58.2 of the
8 Environmental Protection Act.
9 (m) Education expense credit. Beginning with tax years
10ending after December 31, 1999, a taxpayer who is the custodian
11of one or more qualifying pupils shall be allowed a credit
12against the tax imposed by subsections (a) and (b) of this
13Section for qualified education expenses incurred on behalf of
14the qualifying pupils. The credit shall be equal to 25% of
15qualified education expenses, but in no event may the total
16credit under this subsection claimed by a family that is the
17custodian of qualifying pupils exceed $500. In no event shall a
18credit under this subsection reduce the taxpayer's liability
19under this Act to less than zero. This subsection is exempt
20from the provisions of Section 250 of this Act.
21 For purposes of this subsection:
22 "Qualifying pupils" means individuals who (i) are
23residents of the State of Illinois, (ii) are under the age of
2421 at the close of the school year for which a credit is
25sought, and (iii) during the school year for which a credit is
26sought were full-time pupils enrolled in a kindergarten through

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1twelfth grade education program at any school, as defined in
2this subsection.
3 "Qualified education expense" means the amount incurred on
4behalf of a qualifying pupil in excess of $250 for tuition,
5book fees, and lab fees at the school in which the pupil is
6enrolled during the regular school year.
7 "School" means any public or nonpublic elementary or
8secondary school in Illinois that is in compliance with Title
9VI of the Civil Rights Act of 1964 and attendance at which
10satisfies the requirements of Section 26-1 of the School Code,
11except that nothing shall be construed to require a child to
12attend any particular public or nonpublic school to qualify for
13the credit under this Section.
14 "Custodian" means, with respect to qualifying pupils, an
15Illinois resident who is a parent, the parents, a legal
16guardian, or the legal guardians of the qualifying pupils.
17 (n) River Edge Redevelopment Zone site remediation tax
18credit.
19 (i) For tax years ending on or after December 31, 2006,
20 a taxpayer shall be allowed a credit against the tax
21 imposed by subsections (a) and (b) of this Section for
22 certain amounts paid for unreimbursed eligible remediation
23 costs, as specified in this subsection. For purposes of
24 this Section, "unreimbursed eligible remediation costs"
25 means costs approved by the Illinois Environmental
26 Protection Agency ("Agency") under Section 58.14a of the

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1 Environmental Protection Act that were paid in performing
2 environmental remediation at a site within a River Edge
3 Redevelopment Zone for which a No Further Remediation
4 Letter was issued by the Agency and recorded under Section
5 58.10 of the Environmental Protection Act. The credit must
6 be claimed for the taxable year in which Agency approval of
7 the eligible remediation costs is granted. The credit is
8 not available to any taxpayer if the taxpayer or any
9 related party caused or contributed to, in any material
10 respect, a release of regulated substances on, in, or under
11 the site that was identified and addressed by the remedial
12 action pursuant to the Site Remediation Program of the
13 Environmental Protection Act. Determinations as to credit
14 availability for purposes of this Section shall be made
15 consistent with rules adopted by the Pollution Control
16 Board pursuant to the Illinois Administrative Procedure
17 Act for the administration and enforcement of Section 58.9
18 of the Environmental Protection Act. For purposes of this
19 Section, "taxpayer" includes a person whose tax attributes
20 the taxpayer has succeeded to under Section 381 of the
21 Internal Revenue Code and "related party" includes the
22 persons disallowed a deduction for losses by paragraphs
23 (b), (c), and (f)(1) of Section 267 of the Internal Revenue
24 Code by virtue of being a related taxpayer, as well as any
25 of its partners. The credit allowed against the tax imposed
26 by subsections (a) and (b) shall be equal to 25% of the

09800SB1739ham002- 142 -LRB098 10559 AMC 46792 a
1 unreimbursed eligible remediation costs in excess of
2 $100,000 per site.
3 (ii) A credit allowed under this subsection that is
4 unused in the year the credit is earned may be carried
5 forward to each of the 5 taxable years following the year
6 for which the credit is first earned until it is used. This
7 credit shall be applied first to the earliest year for
8 which there is a liability. If there is a credit under this
9 subsection from more than one tax year that is available to
10 offset a liability, the earliest credit arising under this
11 subsection shall be applied first. A credit allowed under
12 this subsection may be sold to a buyer as part of a sale of
13 all or part of the remediation site for which the credit
14 was granted. The purchaser of a remediation site and the
15 tax credit shall succeed to the unused credit and remaining
16 carry-forward period of the seller. To perfect the
17 transfer, the assignor shall record the transfer in the
18 chain of title for the site and provide written notice to
19 the Director of the Illinois Department of Revenue of the
20 assignor's intent to sell the remediation site and the
21 amount of the tax credit to be transferred as a portion of
22 the sale. In no event may a credit be transferred to any
23 taxpayer if the taxpayer or a related party would not be
24 eligible under the provisions of subsection (i).
25 (iii) For purposes of this Section, the term "site"
26 shall have the same meaning as under Section 58.2 of the

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1 Environmental Protection Act.
2(Source: P.A. 96-115, eff. 7-31-09; 96-116, eff. 7-31-09;
396-937, eff. 6-23-10; 96-1000, eff. 7-2-10; 96-1496, eff.
41-13-11; 97-2, eff. 5-6-11; 97-636, eff. 6-1-12; 97-905, eff.
58-7-12.)
6 (35 ILCS 5/303) (from Ch. 120, par. 3-303)
7 Sec. 303. (a) In general. Any item of capital gain or loss,
8and any item of income from rents or royalties from real or
9tangible personal property, interest, dividends, and patent or
10copyright royalties, and prizes awarded under the Illinois
11Lottery Law, and, for taxable years ending on or after December
1231, 2013, wagering and gambling winnings from Illinois sources
13as set forth in subsection (e-1) of this Section, to the extent
14such item constitutes nonbusiness income, together with any
15item of deduction directly allocable thereto, shall be
16allocated by any person other than a resident as provided in
17this Section.
18 (b) Capital gains and losses.
19 (1) Real property. Capital gains and losses from sales
20 or exchanges of real property are allocable to this State
21 if the property is located in this State.
22 (2) Tangible personal property. Capital gains and
23 losses from sales or exchanges of tangible personal
24 property are allocable to this State if, at the time of
25 such sale or exchange:

09800SB1739ham002- 144 -LRB098 10559 AMC 46792 a
1 (A) The property had its situs in this State; or
2 (B) The taxpayer had its commercial domicile in
3 this State and was not taxable in the state in which
4 the property had its situs.
5 (3) Intangibles. Capital gains and losses from sales or
6 exchanges of intangible personal property are allocable to
7 this State if the taxpayer had its commercial domicile in
8 this State at the time of such sale or exchange.
9 (c) Rents and royalties.
10 (1) Real property. Rents and royalties from real
11 property are allocable to this State if the property is
12 located in this State.
13 (2) Tangible personal property. Rents and royalties
14 from tangible personal property are allocable to this
15 State:
16 (A) If and to the extent that the property is
17 utilized in this State; or
18 (B) In their entirety if, at the time such rents or
19 royalties were paid or accrued, the taxpayer had its
20 commercial domicile in this State and was not organized
21 under the laws of or taxable with respect to such rents
22 or royalties in the state in which the property was
23 utilized. The extent of utilization of tangible
24 personal property in a state is determined by
25 multiplying the rents or royalties derived from such
26 property by a fraction, the numerator of which is the

09800SB1739ham002- 145 -LRB098 10559 AMC 46792 a
1 number of days of physical location of the property in
2 the state during the rental or royalty period in the
3 taxable year and the denominator of which is the number
4 of days of physical location of the property everywhere
5 during all rental or royalty periods in the taxable
6 year. If the physical location of the property during
7 the rental or royalty period is unknown or
8 unascertainable by the taxpayer, tangible personal
9 property is utilized in the state in which the property
10 was located at the time the rental or royalty payer
11 obtained possession.
12 (d) Patent and copyright royalties.
13 (1) Allocation. Patent and copyright royalties are
14 allocable to this State:
15 (A) If and to the extent that the patent or
16 copyright is utilized by the payer in this State; or
17 (B) If and to the extent that the patent or
18 copyright is utilized by the payer in a state in which
19 the taxpayer is not taxable with respect to such
20 royalties and, at the time such royalties were paid or
21 accrued, the taxpayer had its commercial domicile in
22 this State.
23 (2) Utilization.
24 (A) A patent is utilized in a state to the extent
25 that it is employed in production, fabrication,
26 manufacturing or other processing in the state or to

09800SB1739ham002- 146 -LRB098 10559 AMC 46792 a
1 the extent that a patented product is produced in the
2 state. If the basis of receipts from patent royalties
3 does not permit allocation to states or if the
4 accounting procedures do not reflect states of
5 utilization, the patent is utilized in this State if
6 the taxpayer has its commercial domicile in this State.
7 (B) A copyright is utilized in a state to the
8 extent that printing or other publication originates
9 in the state. If the basis of receipts from copyright
10 royalties does not permit allocation to states or if
11 the accounting procedures do not reflect states of
12 utilization, the copyright is utilized in this State if
13 the taxpayer has its commercial domicile in this State.
14 (e) Illinois lottery prizes. Prizes awarded under the
15"Illinois Lottery Law", approved December 14, 1973, are
16allocable to this State.
17 (e-1) Wagering and gambling winnings. Payments received in
18taxable years ending on or after December 31, 2013 of winnings
19from pari-mutuel wagering conducted at a wagering facility
20licensed under the Illinois Horse Racing Act of 1975 and from
21gambling games conducted on a riverboat or in a casino or
22electronic gaming facility licensed under the Illinois
23Gambling Act are allocable to this State.
24 (e-5) Unemployment benefits. Unemployment benefits paid by
25the Illinois Department of Employment Security are allocable to
26this State.

09800SB1739ham002- 147 -LRB098 10559 AMC 46792 a
1 (f) Taxability in other state. For purposes of allocation
2of income pursuant to this Section, a taxpayer is taxable in
3another state if:
4 (1) In that state he is subject to a net income tax, a
5 franchise tax measured by net income, a franchise tax for
6 the privilege of doing business, or a corporate stock tax;
7 or
8 (2) That state has jurisdiction to subject the taxpayer
9 to a net income tax regardless of whether, in fact, the
10 state does or does not.
11 (g) Cross references.
12 (1) For allocation of interest and dividends by persons
13 other than residents, see Section 301(c)(2).
14 (2) For allocation of nonbusiness income by residents,
15 see Section 301(a).
16(Source: P.A. 97-709, eff. 7-1-12.)
17 (35 ILCS 5/304) (from Ch. 120, par. 3-304)
18 Sec. 304. Business income of persons other than residents.
19 (a) In general. The business income of a person other than
20a resident shall be allocated to this State if such person's
21business income is derived solely from this State. If a person
22other than a resident derives business income from this State
23and one or more other states, then, for tax years ending on or
24before December 30, 1998, and except as otherwise provided by
25this Section, such person's business income shall be

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1apportioned to this State by multiplying the income by a
2fraction, the numerator of which is the sum of the property
3factor (if any), the payroll factor (if any) and 200% of the
4sales factor (if any), and the denominator of which is 4
5reduced by the number of factors other than the sales factor
6which have a denominator of zero and by an additional 2 if the
7sales factor has a denominator of zero. For tax years ending on
8or after December 31, 1998, and except as otherwise provided by
9this Section, persons other than residents who derive business
10income from this State and one or more other states shall
11compute their apportionment factor by weighting their
12property, payroll, and sales factors as provided in subsection
13(h) of this Section.
14 (1) Property factor.
15 (A) The property factor is a fraction, the numerator of
16 which is the average value of the person's real and
17 tangible personal property owned or rented and used in the
18 trade or business in this State during the taxable year and
19 the denominator of which is the average value of all the
20 person's real and tangible personal property owned or
21 rented and used in the trade or business during the taxable
22 year.
23 (B) Property owned by the person is valued at its
24 original cost. Property rented by the person is valued at 8
25 times the net annual rental rate. Net annual rental rate is
26 the annual rental rate paid by the person less any annual

09800SB1739ham002- 149 -LRB098 10559 AMC 46792 a
1 rental rate received by the person from sub-rentals.
2 (C) The average value of property shall be determined
3 by averaging the values at the beginning and ending of the
4 taxable year but the Director may require the averaging of
5 monthly values during the taxable year if reasonably
6 required to reflect properly the average value of the
7 person's property.
8 (2) Payroll factor.
9 (A) The payroll factor is a fraction, the numerator of
10 which is the total amount paid in this State during the
11 taxable year by the person for compensation, and the
12 denominator of which is the total compensation paid
13 everywhere during the taxable year.
14 (B) Compensation is paid in this State if:
15 (i) The individual's service is performed entirely
16 within this State;
17 (ii) The individual's service is performed both
18 within and without this State, but the service
19 performed without this State is incidental to the
20 individual's service performed within this State; or
21 (iii) Some of the service is performed within this
22 State and either the base of operations, or if there is
23 no base of operations, the place from which the service
24 is directed or controlled is within this State, or the
25 base of operations or the place from which the service
26 is directed or controlled is not in any state in which

09800SB1739ham002- 150 -LRB098 10559 AMC 46792 a
1 some part of the service is performed, but the
2 individual's residence is in this State.
3 (iv) Compensation paid to nonresident professional
4 athletes.
5 (a) General. The Illinois source income of a
6 nonresident individual who is a member of a
7 professional athletic team includes the portion of the
8 individual's total compensation for services performed
9 as a member of a professional athletic team during the
10 taxable year which the number of duty days spent within
11 this State performing services for the team in any
12 manner during the taxable year bears to the total
13 number of duty days spent both within and without this
14 State during the taxable year.
15 (b) Travel days. Travel days that do not involve
16 either a game, practice, team meeting, or other similar
17 team event are not considered duty days spent in this
18 State. However, such travel days are considered in the
19 total duty days spent both within and without this
20 State.
21 (c) Definitions. For purposes of this subpart
22 (iv):
23 (1) The term "professional athletic team"
24 includes, but is not limited to, any professional
25 baseball, basketball, football, soccer, or hockey
26 team.

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1 (2) The term "member of a professional
2 athletic team" includes those employees who are
3 active players, players on the disabled list, and
4 any other persons required to travel and who travel
5 with and perform services on behalf of a
6 professional athletic team on a regular basis.
7 This includes, but is not limited to, coaches,
8 managers, and trainers.
9 (3) Except as provided in items (C) and (D) of
10 this subpart (3), the term "duty days" means all
11 days during the taxable year from the beginning of
12 the professional athletic team's official
13 pre-season training period through the last game
14 in which the team competes or is scheduled to
15 compete. Duty days shall be counted for the year in
16 which they occur, including where a team's
17 official pre-season training period through the
18 last game in which the team competes or is
19 scheduled to compete, occurs during more than one
20 tax year.
21 (A) Duty days shall also include days on
22 which a member of a professional athletic team
23 performs service for a team on a date that does
24 not fall within the foregoing period (e.g.,
25 participation in instructional leagues, the
26 "All Star Game", or promotional "caravans").

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1 Performing a service for a professional
2 athletic team includes conducting training and
3 rehabilitation activities, when such
4 activities are conducted at team facilities.
5 (B) Also included in duty days are game
6 days, practice days, days spent at team
7 meetings, promotional caravans, preseason
8 training camps, and days served with the team
9 through all post-season games in which the team
10 competes or is scheduled to compete.
11 (C) Duty days for any person who joins a
12 team during the period from the beginning of
13 the professional athletic team's official
14 pre-season training period through the last
15 game in which the team competes, or is
16 scheduled to compete, shall begin on the day
17 that person joins the team. Conversely, duty
18 days for any person who leaves a team during
19 this period shall end on the day that person
20 leaves the team. Where a person switches teams
21 during a taxable year, a separate duty-day
22 calculation shall be made for the period the
23 person was with each team.
24 (D) Days for which a member of a
25 professional athletic team is not compensated
26 and is not performing services for the team in

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1 any manner, including days when such member of
2 a professional athletic team has been
3 suspended without pay and prohibited from
4 performing any services for the team, shall not
5 be treated as duty days.
6 (E) Days for which a member of a
7 professional athletic team is on the disabled
8 list and does not conduct rehabilitation
9 activities at facilities of the team, and is
10 not otherwise performing services for the team
11 in Illinois, shall not be considered duty days
12 spent in this State. All days on the disabled
13 list, however, are considered to be included in
14 total duty days spent both within and without
15 this State.
16 (4) The term "total compensation for services
17 performed as a member of a professional athletic
18 team" means the total compensation received during
19 the taxable year for services performed:
20 (A) from the beginning of the official
21 pre-season training period through the last
22 game in which the team competes or is scheduled
23 to compete during that taxable year; and
24 (B) during the taxable year on a date which
25 does not fall within the foregoing period
26 (e.g., participation in instructional leagues,

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1 the "All Star Game", or promotional caravans).
2 This compensation shall include, but is not
3 limited to, salaries, wages, bonuses as described
4 in this subpart, and any other type of compensation
5 paid during the taxable year to a member of a
6 professional athletic team for services performed
7 in that year. This compensation does not include
8 strike benefits, severance pay, termination pay,
9 contract or option year buy-out payments,
10 expansion or relocation payments, or any other
11 payments not related to services performed for the
12 team.
13 For purposes of this subparagraph, "bonuses"
14 included in "total compensation for services
15 performed as a member of a professional athletic
16 team" subject to the allocation described in
17 Section 302(c)(1) are: bonuses earned as a result
18 of play (i.e., performance bonuses) during the
19 season, including bonuses paid for championship,
20 playoff or "bowl" games played by a team, or for
21 selection to all-star league or other honorary
22 positions; and bonuses paid for signing a
23 contract, unless the payment of the signing bonus
24 is not conditional upon the signee playing any
25 games for the team or performing any subsequent
26 services for the team or even making the team, the

09800SB1739ham002- 155 -LRB098 10559 AMC 46792 a
1 signing bonus is payable separately from the
2 salary and any other compensation, and the signing
3 bonus is nonrefundable.
4 (3) Sales factor.
5 (A) The sales factor is a fraction, the numerator of
6 which is the total sales of the person in this State during
7 the taxable year, and the denominator of which is the total
8 sales of the person everywhere during the taxable year.
9 (B) Sales of tangible personal property are in this
10 State if:
11 (i) The property is delivered or shipped to a
12 purchaser, other than the United States government,
13 within this State regardless of the f. o. b. point or
14 other conditions of the sale; or
15 (ii) The property is shipped from an office, store,
16 warehouse, factory or other place of storage in this
17 State and either the purchaser is the United States
18 government or the person is not taxable in the state of
19 the purchaser; provided, however, that premises owned
20 or leased by a person who has independently contracted
21 with the seller for the printing of newspapers,
22 periodicals or books shall not be deemed to be an
23 office, store, warehouse, factory or other place of
24 storage for purposes of this Section. Sales of tangible
25 personal property are not in this State if the seller
26 and purchaser would be members of the same unitary

09800SB1739ham002- 156 -LRB098 10559 AMC 46792 a
1 business group but for the fact that either the seller
2 or purchaser is a person with 80% or more of total
3 business activity outside of the United States and the
4 property is purchased for resale.
5 (B-1) Patents, copyrights, trademarks, and similar
6 items of intangible personal property.
7 (i) Gross receipts from the licensing, sale, or
8 other disposition of a patent, copyright, trademark,
9 or similar item of intangible personal property, other
10 than gross receipts governed by paragraph (B-7) of this
11 item (3), are in this State to the extent the item is
12 utilized in this State during the year the gross
13 receipts are included in gross income.
14 (ii) Place of utilization.
15 (I) A patent is utilized in a state to the
16 extent that it is employed in production,
17 fabrication, manufacturing, or other processing in
18 the state or to the extent that a patented product
19 is produced in the state. If a patent is utilized
20 in more than one state, the extent to which it is
21 utilized in any one state shall be a fraction equal
22 to the gross receipts of the licensee or purchaser
23 from sales or leases of items produced,
24 fabricated, manufactured, or processed within that
25 state using the patent and of patented items
26 produced within that state, divided by the total of

09800SB1739ham002- 157 -LRB098 10559 AMC 46792 a
1 such gross receipts for all states in which the
2 patent is utilized.
3 (II) A copyright is utilized in a state to the
4 extent that printing or other publication
5 originates in the state. If a copyright is utilized
6 in more than one state, the extent to which it is
7 utilized in any one state shall be a fraction equal
8 to the gross receipts from sales or licenses of
9 materials printed or published in that state
10 divided by the total of such gross receipts for all
11 states in which the copyright is utilized.
12 (III) Trademarks and other items of intangible
13 personal property governed by this paragraph (B-1)
14 are utilized in the state in which the commercial
15 domicile of the licensee or purchaser is located.
16 (iii) If the state of utilization of an item of
17 property governed by this paragraph (B-1) cannot be
18 determined from the taxpayer's books and records or
19 from the books and records of any person related to the
20 taxpayer within the meaning of Section 267(b) of the
21 Internal Revenue Code, 26 U.S.C. 267, the gross
22 receipts attributable to that item shall be excluded
23 from both the numerator and the denominator of the
24 sales factor.
25 (B-2) Gross receipts from the license, sale, or other
26 disposition of patents, copyrights, trademarks, and

09800SB1739ham002- 158 -LRB098 10559 AMC 46792 a
1 similar items of intangible personal property, other than
2 gross receipts governed by paragraph (B-7) of this item
3 (3), may be included in the numerator or denominator of the
4 sales factor only if gross receipts from licenses, sales,
5 or other disposition of such items comprise more than 50%
6 of the taxpayer's total gross receipts included in gross
7 income during the tax year and during each of the 2
8 immediately preceding tax years; provided that, when a
9 taxpayer is a member of a unitary business group, such
10 determination shall be made on the basis of the gross
11 receipts of the entire unitary business group.
12 (B-5) For taxable years ending on or after December 31,
13 2008, except as provided in subsections (ii) through (vii),
14 receipts from the sale of telecommunications service or
15 mobile telecommunications service are in this State if the
16 customer's service address is in this State.
17 (i) For purposes of this subparagraph (B-5), the
18 following terms have the following meanings:
19 "Ancillary services" means services that are
20 associated with or incidental to the provision of
21 "telecommunications services", including but not
22 limited to "detailed telecommunications billing",
23 "directory assistance", "vertical service", and "voice
24 mail services".
25 "Air-to-Ground Radiotelephone service" means a
26 radio service, as that term is defined in 47 CFR 22.99,

09800SB1739ham002- 159 -LRB098 10559 AMC 46792 a
1 in which common carriers are authorized to offer and
2 provide radio telecommunications service for hire to
3 subscribers in aircraft.
4 "Call-by-call Basis" means any method of charging
5 for telecommunications services where the price is
6 measured by individual calls.
7 "Communications Channel" means a physical or
8 virtual path of communications over which signals are
9 transmitted between or among customer channel
10 termination points.
11 "Conference bridging service" means an "ancillary
12 service" that links two or more participants of an
13 audio or video conference call and may include the
14 provision of a telephone number. "Conference bridging
15 service" does not include the "telecommunications
16 services" used to reach the conference bridge.
17 "Customer Channel Termination Point" means the
18 location where the customer either inputs or receives
19 the communications.
20 "Detailed telecommunications billing service"
21 means an "ancillary service" of separately stating
22 information pertaining to individual calls on a
23 customer's billing statement.
24 "Directory assistance" means an "ancillary
25 service" of providing telephone number information,
26 and/or address information.

09800SB1739ham002- 160 -LRB098 10559 AMC 46792 a
1 "Home service provider" means the facilities based
2 carrier or reseller with which the customer contracts
3 for the provision of mobile telecommunications
4 services.
5 "Mobile telecommunications service" means
6 commercial mobile radio service, as defined in Section
7 20.3 of Title 47 of the Code of Federal Regulations as
8 in effect on June 1, 1999.
9 "Place of primary use" means the street address
10 representative of where the customer's use of the
11 telecommunications service primarily occurs, which
12 must be the residential street address or the primary
13 business street address of the customer. In the case of
14 mobile telecommunications services, "place of primary
15 use" must be within the licensed service area of the
16 home service provider.
17 "Post-paid telecommunication service" means the
18 telecommunications service obtained by making a
19 payment on a call-by-call basis either through the use
20 of a credit card or payment mechanism such as a bank
21 card, travel card, credit card, or debit card, or by
22 charge made to a telephone number which is not
23 associated with the origination or termination of the
24 telecommunications service. A post-paid calling
25 service includes telecommunications service, except a
26 prepaid wireless calling service, that would be a

09800SB1739ham002- 161 -LRB098 10559 AMC 46792 a
1 prepaid calling service except it is not exclusively a
2 telecommunication service.
3 "Prepaid telecommunication service" means the
4 right to access exclusively telecommunications
5 services, which must be paid for in advance and which
6 enables the origination of calls using an access number
7 or authorization code, whether manually or
8 electronically dialed, and that is sold in
9 predetermined units or dollars of which the number
10 declines with use in a known amount.
11 "Prepaid Mobile telecommunication service" means a
12 telecommunications service that provides the right to
13 utilize mobile wireless service as well as other
14 non-telecommunication services, including but not
15 limited to ancillary services, which must be paid for
16 in advance that is sold in predetermined units or
17 dollars of which the number declines with use in a
18 known amount.
19 "Private communication service" means a
20 telecommunication service that entitles the customer
21 to exclusive or priority use of a communications
22 channel or group of channels between or among
23 termination points, regardless of the manner in which
24 such channel or channels are connected, and includes
25 switching capacity, extension lines, stations, and any
26 other associated services that are provided in

09800SB1739ham002- 162 -LRB098 10559 AMC 46792 a
1 connection with the use of such channel or channels.
2 "Service address" means:
3 (a) The location of the telecommunications
4 equipment to which a customer's call is charged and
5 from which the call originates or terminates,
6 regardless of where the call is billed or paid;
7 (b) If the location in line (a) is not known,
8 service address means the origination point of the
9 signal of the telecommunications services first
10 identified by either the seller's
11 telecommunications system or in information
12 received by the seller from its service provider
13 where the system used to transport such signals is
14 not that of the seller; and
15 (c) If the locations in line (a) and line (b)
16 are not known, the service address means the
17 location of the customer's place of primary use.
18 "Telecommunications service" means the electronic
19 transmission, conveyance, or routing of voice, data,
20 audio, video, or any other information or signals to a
21 point, or between or among points. The term
22 "telecommunications service" includes such
23 transmission, conveyance, or routing in which computer
24 processing applications are used to act on the form,
25 code or protocol of the content for purposes of
26 transmission, conveyance or routing without regard to

09800SB1739ham002- 163 -LRB098 10559 AMC 46792 a
1 whether such service is referred to as voice over
2 Internet protocol services or is classified by the
3 Federal Communications Commission as enhanced or value
4 added. "Telecommunications service" does not include:
5 (a) Data processing and information services
6 that allow data to be generated, acquired, stored,
7 processed, or retrieved and delivered by an
8 electronic transmission to a purchaser when such
9 purchaser's primary purpose for the underlying
10 transaction is the processed data or information;
11 (b) Installation or maintenance of wiring or
12 equipment on a customer's premises;
13 (c) Tangible personal property;
14 (d) Advertising, including but not limited to
15 directory advertising.
16 (e) Billing and collection services provided
17 to third parties;
18 (f) Internet access service;
19 (g) Radio and television audio and video
20 programming services, regardless of the medium,
21 including the furnishing of transmission,
22 conveyance and routing of such services by the
23 programming service provider. Radio and television
24 audio and video programming services shall include
25 but not be limited to cable service as defined in
26 47 USC 522(6) and audio and video programming

09800SB1739ham002- 164 -LRB098 10559 AMC 46792 a
1 services delivered by commercial mobile radio
2 service providers, as defined in 47 CFR 20.3;
3 (h) "Ancillary services"; or
4 (i) Digital products "delivered
5 electronically", including but not limited to
6 software, music, video, reading materials or ring
7 tones.
8 "Vertical service" means an "ancillary service"
9 that is offered in connection with one or more
10 "telecommunications services", which offers advanced
11 calling features that allow customers to identify
12 callers and to manage multiple calls and call
13 connections, including "conference bridging services".
14 "Voice mail service" means an "ancillary service"
15 that enables the customer to store, send or receive
16 recorded messages. "Voice mail service" does not
17 include any "vertical services" that the customer may
18 be required to have in order to utilize the "voice mail
19 service".
20 (ii) Receipts from the sale of telecommunications
21 service sold on an individual call-by-call basis are in
22 this State if either of the following applies:
23 (a) The call both originates and terminates in
24 this State.
25 (b) The call either originates or terminates
26 in this State and the service address is located in

09800SB1739ham002- 165 -LRB098 10559 AMC 46792 a
1 this State.
2 (iii) Receipts from the sale of postpaid
3 telecommunications service at retail are in this State
4 if the origination point of the telecommunication
5 signal, as first identified by the service provider's
6 telecommunication system or as identified by
7 information received by the seller from its service
8 provider if the system used to transport
9 telecommunication signals is not the seller's, is
10 located in this State.
11 (iv) Receipts from the sale of prepaid
12 telecommunications service or prepaid mobile
13 telecommunications service at retail are in this State
14 if the purchaser obtains the prepaid card or similar
15 means of conveyance at a location in this State.
16 Receipts from recharging a prepaid telecommunications
17 service or mobile telecommunications service is in
18 this State if the purchaser's billing information
19 indicates a location in this State.
20 (v) Receipts from the sale of private
21 communication services are in this State as follows:
22 (a) 100% of receipts from charges imposed at
23 each channel termination point in this State.
24 (b) 100% of receipts from charges for the total
25 channel mileage between each channel termination
26 point in this State.

09800SB1739ham002- 166 -LRB098 10559 AMC 46792 a
1 (c) 50% of the total receipts from charges for
2 service segments when those segments are between 2
3 customer channel termination points, 1 of which is
4 located in this State and the other is located
5 outside of this State, which segments are
6 separately charged.
7 (d) The receipts from charges for service
8 segments with a channel termination point located
9 in this State and in two or more other states, and
10 which segments are not separately billed, are in
11 this State based on a percentage determined by
12 dividing the number of customer channel
13 termination points in this State by the total
14 number of customer channel termination points.
15 (vi) Receipts from charges for ancillary services
16 for telecommunications service sold to customers at
17 retail are in this State if the customer's primary
18 place of use of telecommunications services associated
19 with those ancillary services is in this State. If the
20 seller of those ancillary services cannot determine
21 where the associated telecommunications are located,
22 then the ancillary services shall be based on the
23 location of the purchaser.
24 (vii) Receipts to access a carrier's network or
25 from the sale of telecommunication services or
26 ancillary services for resale are in this State as

09800SB1739ham002- 167 -LRB098 10559 AMC 46792 a
1 follows:
2 (a) 100% of the receipts from access fees
3 attributable to intrastate telecommunications
4 service that both originates and terminates in
5 this State.
6 (b) 50% of the receipts from access fees
7 attributable to interstate telecommunications
8 service if the interstate call either originates
9 or terminates in this State.
10 (c) 100% of the receipts from interstate end
11 user access line charges, if the customer's
12 service address is in this State. As used in this
13 subdivision, "interstate end user access line
14 charges" includes, but is not limited to, the
15 surcharge approved by the federal communications
16 commission and levied pursuant to 47 CFR 69.
17 (d) Gross receipts from sales of
18 telecommunication services or from ancillary
19 services for telecommunications services sold to
20 other telecommunication service providers for
21 resale shall be sourced to this State using the
22 apportionment concepts used for non-resale
23 receipts of telecommunications services if the
24 information is readily available to make that
25 determination. If the information is not readily
26 available, then the taxpayer may use any other

09800SB1739ham002- 168 -LRB098 10559 AMC 46792 a
1 reasonable and consistent method.
2 (B-7) For taxable years ending on or after December 31,
3 2008, receipts from the sale of broadcasting services are
4 in this State if the broadcasting services are received in
5 this State. For purposes of this paragraph (B-7), the
6 following terms have the following meanings:
7 "Advertising revenue" means consideration received
8 by the taxpayer in exchange for broadcasting services
9 or allowing the broadcasting of commercials or
10 announcements in connection with the broadcasting of
11 film or radio programming, from sponsorships of the
12 programming, or from product placements in the
13 programming.
14 "Audience factor" means the ratio that the
15 audience or subscribers located in this State of a
16 station, a network, or a cable system bears to the
17 total audience or total subscribers for that station,
18 network, or cable system. The audience factor for film
19 or radio programming shall be determined by reference
20 to the books and records of the taxpayer or by
21 reference to published rating statistics provided the
22 method used by the taxpayer is consistently used from
23 year to year for this purpose and fairly represents the
24 taxpayer's activity in this State.
25 "Broadcast" or "broadcasting" or "broadcasting
26 services" means the transmission or provision of film

09800SB1739ham002- 169 -LRB098 10559 AMC 46792 a
1 or radio programming, whether through the public
2 airwaves, by cable, by direct or indirect satellite
3 transmission, or by any other means of communication,
4 either through a station, a network, or a cable system.
5 "Film" or "film programming" means the broadcast
6 on television of any and all performances, events, or
7 productions, including but not limited to news,
8 sporting events, plays, stories, or other literary,
9 commercial, educational, or artistic works, either
10 live or through the use of video tape, disc, or any
11 other type of format or medium. Each episode of a
12 series of films produced for television shall
13 constitute separate "film" notwithstanding that the
14 series relates to the same principal subject and is
15 produced during one or more tax periods.
16 "Radio" or "radio programming" means the broadcast
17 on radio of any and all performances, events, or
18 productions, including but not limited to news,
19 sporting events, plays, stories, or other literary,
20 commercial, educational, or artistic works, either
21 live or through the use of an audio tape, disc, or any
22 other format or medium. Each episode in a series of
23 radio programming produced for radio broadcast shall
24 constitute a separate "radio programming"
25 notwithstanding that the series relates to the same
26 principal subject and is produced during one or more

09800SB1739ham002- 170 -LRB098 10559 AMC 46792 a
1 tax periods.
2 (i) In the case of advertising revenue from
3 broadcasting, the customer is the advertiser and
4 the service is received in this State if the
5 commercial domicile of the advertiser is in this
6 State.
7 (ii) In the case where film or radio
8 programming is broadcast by a station, a network,
9 or a cable system for a fee or other remuneration
10 received from the recipient of the broadcast, the
11 portion of the service that is received in this
12 State is measured by the portion of the recipients
13 of the broadcast located in this State.
14 Accordingly, the fee or other remuneration for
15 such service that is included in the Illinois
16 numerator of the sales factor is the total of those
17 fees or other remuneration received from
18 recipients in Illinois. For purposes of this
19 paragraph, a taxpayer may determine the location
20 of the recipients of its broadcast using the
21 address of the recipient shown in its contracts
22 with the recipient or using the billing address of
23 the recipient in the taxpayer's records.
24 (iii) In the case where film or radio
25 programming is broadcast by a station, a network,
26 or a cable system for a fee or other remuneration

09800SB1739ham002- 171 -LRB098 10559 AMC 46792 a
1 from the person providing the programming, the
2 portion of the broadcast service that is received
3 by such station, network, or cable system in this
4 State is measured by the portion of recipients of
5 the broadcast located in this State. Accordingly,
6 the amount of revenue related to such an
7 arrangement that is included in the Illinois
8 numerator of the sales factor is the total fee or
9 other total remuneration from the person providing
10 the programming related to that broadcast
11 multiplied by the Illinois audience factor for
12 that broadcast.
13 (iv) In the case where film or radio
14 programming is provided by a taxpayer that is a
15 network or station to a customer for broadcast in
16 exchange for a fee or other remuneration from that
17 customer the broadcasting service is received at
18 the location of the office of the customer from
19 which the services were ordered in the regular
20 course of the customer's trade or business.
21 Accordingly, in such a case the revenue derived by
22 the taxpayer that is included in the taxpayer's
23 Illinois numerator of the sales factor is the
24 revenue from such customers who receive the
25 broadcasting service in Illinois.
26 (v) In the case where film or radio programming

09800SB1739ham002- 172 -LRB098 10559 AMC 46792 a
1 is provided by a taxpayer that is not a network or
2 station to another person for broadcasting in
3 exchange for a fee or other remuneration from that
4 person, the broadcasting service is received at
5 the location of the office of the customer from
6 which the services were ordered in the regular
7 course of the customer's trade or business.
8 Accordingly, in such a case the revenue derived by
9 the taxpayer that is included in the taxpayer's
10 Illinois numerator of the sales factor is the
11 revenue from such customers who receive the
12 broadcasting service in Illinois.
13 (B-8) For taxable years ending on or after December 31,
14 2013, gross receipts from winnings from pari-mutuel
15 wagering conducted at a wagering facility licensed under
16 the Illinois Horse Racing Act of 1975 or from winnings from
17 gambling games conducted on a riverboat or in a casino or
18 electronic gaming facility licensed under the Illinois
19 Gambling Act are in this State.
20 (C) For taxable years ending before December 31, 2008,
21 sales, other than sales governed by paragraphs (B), (B-1),
22 and (B-2), are in this State if:
23 (i) The income-producing activity is performed in
24 this State; or
25 (ii) The income-producing activity is performed
26 both within and without this State and a greater

09800SB1739ham002- 173 -LRB098 10559 AMC 46792 a
1 proportion of the income-producing activity is
2 performed within this State than without this State,
3 based on performance costs.
4 (C-5) For taxable years ending on or after December 31,
5 2008, sales, other than sales governed by paragraphs (B),
6 (B-1), (B-2), (B-5), and (B-7), are in this State if any of
7 the following criteria are met:
8 (i) Sales from the sale or lease of real property
9 are in this State if the property is located in this
10 State.
11 (ii) Sales from the lease or rental of tangible
12 personal property are in this State if the property is
13 located in this State during the rental period. Sales
14 from the lease or rental of tangible personal property
15 that is characteristically moving property, including,
16 but not limited to, motor vehicles, rolling stock,
17 aircraft, vessels, or mobile equipment are in this
18 State to the extent that the property is used in this
19 State.
20 (iii) In the case of interest, net gains (but not
21 less than zero) and other items of income from
22 intangible personal property, the sale is in this State
23 if:
24 (a) in the case of a taxpayer who is a dealer
25 in the item of intangible personal property within
26 the meaning of Section 475 of the Internal Revenue

09800SB1739ham002- 174 -LRB098 10559 AMC 46792 a
1 Code, the income or gain is received from a
2 customer in this State. For purposes of this
3 subparagraph, a customer is in this State if the
4 customer is an individual, trust or estate who is a
5 resident of this State and, for all other
6 customers, if the customer's commercial domicile
7 is in this State. Unless the dealer has actual
8 knowledge of the residence or commercial domicile
9 of a customer during a taxable year, the customer
10 shall be deemed to be a customer in this State if
11 the billing address of the customer, as shown in
12 the records of the dealer, is in this State; or
13 (b) in all other cases, if the
14 income-producing activity of the taxpayer is
15 performed in this State or, if the
16 income-producing activity of the taxpayer is
17 performed both within and without this State, if a
18 greater proportion of the income-producing
19 activity of the taxpayer is performed within this
20 State than in any other state, based on performance
21 costs.
22 (iv) Sales of services are in this State if the
23 services are received in this State. For the purposes
24 of this section, gross receipts from the performance of
25 services provided to a corporation, partnership, or
26 trust may only be attributed to a state where that

09800SB1739ham002- 175 -LRB098 10559 AMC 46792 a
1 corporation, partnership, or trust has a fixed place of
2 business. If the state where the services are received
3 is not readily determinable or is a state where the
4 corporation, partnership, or trust receiving the
5 service does not have a fixed place of business, the
6 services shall be deemed to be received at the location
7 of the office of the customer from which the services
8 were ordered in the regular course of the customer's
9 trade or business. If the ordering office cannot be
10 determined, the services shall be deemed to be received
11 at the office of the customer to which the services are
12 billed. If the taxpayer is not taxable in the state in
13 which the services are received, the sale must be
14 excluded from both the numerator and the denominator of
15 the sales factor. The Department shall adopt rules
16 prescribing where specific types of service are
17 received, including, but not limited to, publishing,
18 and utility service.
19 (D) For taxable years ending on or after December 31,
20 1995, the following items of income shall not be included
21 in the numerator or denominator of the sales factor:
22 dividends; amounts included under Section 78 of the
23 Internal Revenue Code; and Subpart F income as defined in
24 Section 952 of the Internal Revenue Code. No inference
25 shall be drawn from the enactment of this paragraph (D) in
26 construing this Section for taxable years ending before

09800SB1739ham002- 176 -LRB098 10559 AMC 46792 a
1 December 31, 1995.
2 (E) Paragraphs (B-1) and (B-2) shall apply to tax years
3 ending on or after December 31, 1999, provided that a
4 taxpayer may elect to apply the provisions of these
5 paragraphs to prior tax years. Such election shall be made
6 in the form and manner prescribed by the Department, shall
7 be irrevocable, and shall apply to all tax years; provided
8 that, if a taxpayer's Illinois income tax liability for any
9 tax year, as assessed under Section 903 prior to January 1,
10 1999, was computed in a manner contrary to the provisions
11 of paragraphs (B-1) or (B-2), no refund shall be payable to
12 the taxpayer for that tax year to the extent such refund is
13 the result of applying the provisions of paragraph (B-1) or
14 (B-2) retroactively. In the case of a unitary business
15 group, such election shall apply to all members of such
16 group for every tax year such group is in existence, but
17 shall not apply to any taxpayer for any period during which
18 that taxpayer is not a member of such group.
19 (b) Insurance companies.
20 (1) In general. Except as otherwise provided by
21 paragraph (2), business income of an insurance company for
22 a taxable year shall be apportioned to this State by
23 multiplying such income by a fraction, the numerator of
24 which is the direct premiums written for insurance upon
25 property or risk in this State, and the denominator of
26 which is the direct premiums written for insurance upon

09800SB1739ham002- 177 -LRB098 10559 AMC 46792 a
1 property or risk everywhere. For purposes of this
2 subsection, the term "direct premiums written" means the
3 total amount of direct premiums written, assessments and
4 annuity considerations as reported for the taxable year on
5 the annual statement filed by the company with the Illinois
6 Director of Insurance in the form approved by the National
7 Convention of Insurance Commissioners or such other form as
8 may be prescribed in lieu thereof.
9 (2) Reinsurance. If the principal source of premiums
10 written by an insurance company consists of premiums for
11 reinsurance accepted by it, the business income of such
12 company shall be apportioned to this State by multiplying
13 such income by a fraction, the numerator of which is the
14 sum of (i) direct premiums written for insurance upon
15 property or risk in this State, plus (ii) premiums written
16 for reinsurance accepted in respect of property or risk in
17 this State, and the denominator of which is the sum of
18 (iii) direct premiums written for insurance upon property
19 or risk everywhere, plus (iv) premiums written for
20 reinsurance accepted in respect of property or risk
21 everywhere. For purposes of this paragraph, premiums
22 written for reinsurance accepted in respect of property or
23 risk in this State, whether or not otherwise determinable,
24 may, at the election of the company, be determined on the
25 basis of the proportion which premiums written for
26 reinsurance accepted from companies commercially domiciled

09800SB1739ham002- 178 -LRB098 10559 AMC 46792 a
1 in Illinois bears to premiums written for reinsurance
2 accepted from all sources, or, alternatively, in the
3 proportion which the sum of the direct premiums written for
4 insurance upon property or risk in this State by each
5 ceding company from which reinsurance is accepted bears to
6 the sum of the total direct premiums written by each such
7 ceding company for the taxable year. The election made by a
8 company under this paragraph for its first taxable year
9 ending on or after December 31, 2011, shall be binding for
10 that company for that taxable year and for all subsequent
11 taxable years, and may be altered only with the written
12 permission of the Department, which shall not be
13 unreasonably withheld.
14 (c) Financial organizations.
15 (1) In general. For taxable years ending before
16 December 31, 2008, business income of a financial
17 organization shall be apportioned to this State by
18 multiplying such income by a fraction, the numerator of
19 which is its business income from sources within this
20 State, and the denominator of which is its business income
21 from all sources. For the purposes of this subsection, the
22 business income of a financial organization from sources
23 within this State is the sum of the amounts referred to in
24 subparagraphs (A) through (E) following, but excluding the
25 adjusted income of an international banking facility as
26 determined in paragraph (2):

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1 (A) Fees, commissions or other compensation for
2 financial services rendered within this State;
3 (B) Gross profits from trading in stocks, bonds or
4 other securities managed within this State;
5 (C) Dividends, and interest from Illinois
6 customers, which are received within this State;
7 (D) Interest charged to customers at places of
8 business maintained within this State for carrying
9 debit balances of margin accounts, without deduction
10 of any costs incurred in carrying such accounts; and
11 (E) Any other gross income resulting from the
12 operation as a financial organization within this
13 State. In computing the amounts referred to in
14 paragraphs (A) through (E) of this subsection, any
15 amount received by a member of an affiliated group
16 (determined under Section 1504(a) of the Internal
17 Revenue Code but without reference to whether any such
18 corporation is an "includible corporation" under
19 Section 1504(b) of the Internal Revenue Code) from
20 another member of such group shall be included only to
21 the extent such amount exceeds expenses of the
22 recipient directly related thereto.
23 (2) International Banking Facility. For taxable years
24 ending before December 31, 2008:
25 (A) Adjusted Income. The adjusted income of an
26 international banking facility is its income reduced

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1 by the amount of the floor amount.
2 (B) Floor Amount. The floor amount shall be the
3 amount, if any, determined by multiplying the income of
4 the international banking facility by a fraction, not
5 greater than one, which is determined as follows:
6 (i) The numerator shall be:
7 The average aggregate, determined on a
8 quarterly basis, of the financial organization's
9 loans to banks in foreign countries, to foreign
10 domiciled borrowers (except where secured
11 primarily by real estate) and to foreign
12 governments and other foreign official
13 institutions, as reported for its branches,
14 agencies and offices within the state on its
15 "Consolidated Report of Condition", Schedule A,
16 Lines 2.c., 5.b., and 7.a., which was filed with
17 the Federal Deposit Insurance Corporation and
18 other regulatory authorities, for the year 1980,
19 minus
20 The average aggregate, determined on a
21 quarterly basis, of such loans (other than loans of
22 an international banking facility), as reported by
23 the financial institution for its branches,
24 agencies and offices within the state, on the
25 corresponding Schedule and lines of the
26 Consolidated Report of Condition for the current

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1 taxable year, provided, however, that in no case
2 shall the amount determined in this clause (the
3 subtrahend) exceed the amount determined in the
4 preceding clause (the minuend); and
5 (ii) the denominator shall be the average
6 aggregate, determined on a quarterly basis, of the
7 international banking facility's loans to banks in
8 foreign countries, to foreign domiciled borrowers
9 (except where secured primarily by real estate)
10 and to foreign governments and other foreign
11 official institutions, which were recorded in its
12 financial accounts for the current taxable year.
13 (C) Change to Consolidated Report of Condition and
14 in Qualification. In the event the Consolidated Report
15 of Condition which is filed with the Federal Deposit
16 Insurance Corporation and other regulatory authorities
17 is altered so that the information required for
18 determining the floor amount is not found on Schedule
19 A, lines 2.c., 5.b. and 7.a., the financial institution
20 shall notify the Department and the Department may, by
21 regulations or otherwise, prescribe or authorize the
22 use of an alternative source for such information. The
23 financial institution shall also notify the Department
24 should its international banking facility fail to
25 qualify as such, in whole or in part, or should there
26 be any amendment or change to the Consolidated Report

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1 of Condition, as originally filed, to the extent such
2 amendment or change alters the information used in
3 determining the floor amount.
4 (3) For taxable years ending on or after December 31,
5 2008, the business income of a financial organization shall
6 be apportioned to this State by multiplying such income by
7 a fraction, the numerator of which is its gross receipts
8 from sources in this State or otherwise attributable to
9 this State's marketplace and the denominator of which is
10 its gross receipts everywhere during the taxable year.
11 "Gross receipts" for purposes of this subparagraph (3)
12 means gross income, including net taxable gain on
13 disposition of assets, including securities and money
14 market instruments, when derived from transactions and
15 activities in the regular course of the financial
16 organization's trade or business. The following examples
17 are illustrative:
18 (i) Receipts from the lease or rental of real or
19 tangible personal property are in this State if the
20 property is located in this State during the rental
21 period. Receipts from the lease or rental of tangible
22 personal property that is characteristically moving
23 property, including, but not limited to, motor
24 vehicles, rolling stock, aircraft, vessels, or mobile
25 equipment are from sources in this State to the extent
26 that the property is used in this State.

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1 (ii) Interest income, commissions, fees, gains on
2 disposition, and other receipts from assets in the
3 nature of loans that are secured primarily by real
4 estate or tangible personal property are from sources
5 in this State if the security is located in this State.
6 (iii) Interest income, commissions, fees, gains on
7 disposition, and other receipts from consumer loans
8 that are not secured by real or tangible personal
9 property are from sources in this State if the debtor
10 is a resident of this State.
11 (iv) Interest income, commissions, fees, gains on
12 disposition, and other receipts from commercial loans
13 and installment obligations that are not secured by
14 real or tangible personal property are from sources in
15 this State if the proceeds of the loan are to be
16 applied in this State. If it cannot be determined where
17 the funds are to be applied, the income and receipts
18 are from sources in this State if the office of the
19 borrower from which the loan was negotiated in the
20 regular course of business is located in this State. If
21 the location of this office cannot be determined, the
22 income and receipts shall be excluded from the
23 numerator and denominator of the sales factor.
24 (v) Interest income, fees, gains on disposition,
25 service charges, merchant discount income, and other
26 receipts from credit card receivables are from sources

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1 in this State if the card charges are regularly billed
2 to a customer in this State.
3 (vi) Receipts from the performance of services,
4 including, but not limited to, fiduciary, advisory,
5 and brokerage services, are in this State if the
6 services are received in this State within the meaning
7 of subparagraph (a)(3)(C-5)(iv) of this Section.
8 (vii) Receipts from the issuance of travelers
9 checks and money orders are from sources in this State
10 if the checks and money orders are issued from a
11 location within this State.
12 (viii) Receipts from investment assets and
13 activities and trading assets and activities are
14 included in the receipts factor as follows:
15 (1) Interest, dividends, net gains (but not
16 less than zero) and other income from investment
17 assets and activities from trading assets and
18 activities shall be included in the receipts
19 factor. Investment assets and activities and
20 trading assets and activities include but are not
21 limited to: investment securities; trading account
22 assets; federal funds; securities purchased and
23 sold under agreements to resell or repurchase;
24 options; futures contracts; forward contracts;
25 notional principal contracts such as swaps;
26 equities; and foreign currency transactions. With

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1 respect to the investment and trading assets and
2 activities described in subparagraphs (A) and (B)
3 of this paragraph, the receipts factor shall
4 include the amounts described in such
5 subparagraphs.
6 (A) The receipts factor shall include the
7 amount by which interest from federal funds
8 sold and securities purchased under resale
9 agreements exceeds interest expense on federal
10 funds purchased and securities sold under
11 repurchase agreements.
12 (B) The receipts factor shall include the
13 amount by which interest, dividends, gains and
14 other income from trading assets and
15 activities, including but not limited to
16 assets and activities in the matched book, in
17 the arbitrage book, and foreign currency
18 transactions, exceed amounts paid in lieu of
19 interest, amounts paid in lieu of dividends,
20 and losses from such assets and activities.
21 (2) The numerator of the receipts factor
22 includes interest, dividends, net gains (but not
23 less than zero), and other income from investment
24 assets and activities and from trading assets and
25 activities described in paragraph (1) of this
26 subsection that are attributable to this State.

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1 (A) The amount of interest, dividends, net
2 gains (but not less than zero), and other
3 income from investment assets and activities
4 in the investment account to be attributed to
5 this State and included in the numerator is
6 determined by multiplying all such income from
7 such assets and activities by a fraction, the
8 numerator of which is the gross income from
9 such assets and activities which are properly
10 assigned to a fixed place of business of the
11 taxpayer within this State and the denominator
12 of which is the gross income from all such
13 assets and activities.
14 (B) The amount of interest from federal
15 funds sold and purchased and from securities
16 purchased under resale agreements and
17 securities sold under repurchase agreements
18 attributable to this State and included in the
19 numerator is determined by multiplying the
20 amount described in subparagraph (A) of
21 paragraph (1) of this subsection from such
22 funds and such securities by a fraction, the
23 numerator of which is the gross income from
24 such funds and such securities which are
25 properly assigned to a fixed place of business
26 of the taxpayer within this State and the

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1 denominator of which is the gross income from
2 all such funds and such securities.
3 (C) The amount of interest, dividends,
4 gains, and other income from trading assets and
5 activities, including but not limited to
6 assets and activities in the matched book, in
7 the arbitrage book and foreign currency
8 transactions (but excluding amounts described
9 in subparagraphs (A) or (B) of this paragraph),
10 attributable to this State and included in the
11 numerator is determined by multiplying the
12 amount described in subparagraph (B) of
13 paragraph (1) of this subsection by a fraction,
14 the numerator of which is the gross income from
15 such trading assets and activities which are
16 properly assigned to a fixed place of business
17 of the taxpayer within this State and the
18 denominator of which is the gross income from
19 all such assets and activities.
20 (D) Properly assigned, for purposes of
21 this paragraph (2) of this subsection, means
22 the investment or trading asset or activity is
23 assigned to the fixed place of business with
24 which it has a preponderance of substantive
25 contacts. An investment or trading asset or
26 activity assigned by the taxpayer to a fixed

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1 place of business without the State shall be
2 presumed to have been properly assigned if:
3 (i) the taxpayer has assigned, in the
4 regular course of its business, such asset
5 or activity on its records to a fixed place
6 of business consistent with federal or
7 state regulatory requirements;
8 (ii) such assignment on its records is
9 based upon substantive contacts of the
10 asset or activity to such fixed place of
11 business; and
12 (iii) the taxpayer uses such records
13 reflecting assignment of such assets or
14 activities for the filing of all state and
15 local tax returns for which an assignment
16 of such assets or activities to a fixed
17 place of business is required.
18 (E) The presumption of proper assignment
19 of an investment or trading asset or activity
20 provided in subparagraph (D) of paragraph (2)
21 of this subsection may be rebutted upon a
22 showing by the Department, supported by a
23 preponderance of the evidence, that the
24 preponderance of substantive contacts
25 regarding such asset or activity did not occur
26 at the fixed place of business to which it was

09800SB1739ham002- 189 -LRB098 10559 AMC 46792 a
1 assigned on the taxpayer's records. If the
2 fixed place of business that has a
3 preponderance of substantive contacts cannot
4 be determined for an investment or trading
5 asset or activity to which the presumption in
6 subparagraph (D) of paragraph (2) of this
7 subsection does not apply or with respect to
8 which that presumption has been rebutted, that
9 asset or activity is properly assigned to the
10 state in which the taxpayer's commercial
11 domicile is located. For purposes of this
12 subparagraph (E), it shall be presumed,
13 subject to rebuttal, that taxpayer's
14 commercial domicile is in the state of the
15 United States or the District of Columbia to
16 which the greatest number of employees are
17 regularly connected with the management of the
18 investment or trading income or out of which
19 they are working, irrespective of where the
20 services of such employees are performed, as of
21 the last day of the taxable year.
22 (4) (Blank).
23 (5) (Blank).
24 (c-1) Federally regulated exchanges. For taxable years
25ending on or after December 31, 2012, business income of a
26federally regulated exchange shall, at the option of the

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1federally regulated exchange, be apportioned to this State by
2multiplying such income by a fraction, the numerator of which
3is its business income from sources within this State, and the
4denominator of which is its business income from all sources.
5For purposes of this subsection, the business income within
6this State of a federally regulated exchange is the sum of the
7following:
8 (1) Receipts attributable to transactions executed on
9 a physical trading floor if that physical trading floor is
10 located in this State.
11 (2) Receipts attributable to all other matching,
12 execution, or clearing transactions, including without
13 limitation receipts from the provision of matching,
14 execution, or clearing services to another entity,
15 multiplied by (i) for taxable years ending on or after
16 December 31, 2012 but before December 31, 2013, 63.77%; and
17 (ii) for taxable years ending on or after December 31,
18 2013, 27.54%.
19 (3) All other receipts not governed by subparagraphs
20 (1) or (2) of this subsection (c-1), to the extent the
21 receipts would be characterized as "sales in this State"
22 under item (3) of subsection (a) of this Section.
23 "Federally regulated exchange" means (i) a "registered
24entity" within the meaning of 7 U.S.C. Section 1a(40)(A), (B),
25or (C), (ii) an "exchange" or "clearing agency" within the
26meaning of 15 U.S.C. Section 78c (a)(1) or (23), (iii) any such

09800SB1739ham002- 191 -LRB098 10559 AMC 46792 a
1entities regulated under any successor regulatory structure to
2the foregoing, and (iv) all taxpayers who are members of the
3same unitary business group as a federally regulated exchange,
4determined without regard to the prohibition in Section
51501(a)(27) of this Act against including in a unitary business
6group taxpayers who are ordinarily required to apportion
7business income under different subsections of this Section;
8provided that this subparagraph (iv) shall apply only if 50% or
9more of the business receipts of the unitary business group
10determined by application of this subparagraph (iv) for the
11taxable year are attributable to the matching, execution, or
12clearing of transactions conducted by an entity described in
13subparagraph (i), (ii), or (iii) of this paragraph.
14 In no event shall the Illinois apportionment percentage
15computed in accordance with this subsection (c-1) for any
16taxpayer for any tax year be less than the Illinois
17apportionment percentage computed under this subsection (c-1)
18for that taxpayer for the first full tax year ending on or
19after December 31, 2013 for which this subsection (c-1) applied
20to the taxpayer.
21 (d) Transportation services. For taxable years ending
22before December 31, 2008, business income derived from
23furnishing transportation services shall be apportioned to
24this State in accordance with paragraphs (1) and (2):
25 (1) Such business income (other than that derived from
26 transportation by pipeline) shall be apportioned to this

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1 State by multiplying such income by a fraction, the
2 numerator of which is the revenue miles of the person in
3 this State, and the denominator of which is the revenue
4 miles of the person everywhere. For purposes of this
5 paragraph, a revenue mile is the transportation of 1
6 passenger or 1 net ton of freight the distance of 1 mile
7 for a consideration. Where a person is engaged in the
8 transportation of both passengers and freight, the
9 fraction above referred to shall be determined by means of
10 an average of the passenger revenue mile fraction and the
11 freight revenue mile fraction, weighted to reflect the
12 person's
13 (A) relative railway operating income from total
14 passenger and total freight service, as reported to the
15 Interstate Commerce Commission, in the case of
16 transportation by railroad, and
17 (B) relative gross receipts from passenger and
18 freight transportation, in case of transportation
19 other than by railroad.
20 (2) Such business income derived from transportation
21 by pipeline shall be apportioned to this State by
22 multiplying such income by a fraction, the numerator of
23 which is the revenue miles of the person in this State, and
24 the denominator of which is the revenue miles of the person
25 everywhere. For the purposes of this paragraph, a revenue
26 mile is the transportation by pipeline of 1 barrel of oil,

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1 1,000 cubic feet of gas, or of any specified quantity of
2 any other substance, the distance of 1 mile for a
3 consideration.
4 (3) For taxable years ending on or after December 31,
5 2008, business income derived from providing
6 transportation services other than airline services shall
7 be apportioned to this State by using a fraction, (a) the
8 numerator of which shall be (i) all receipts from any
9 movement or shipment of people, goods, mail, oil, gas, or
10 any other substance (other than by airline) that both
11 originates and terminates in this State, plus (ii) that
12 portion of the person's gross receipts from movements or
13 shipments of people, goods, mail, oil, gas, or any other
14 substance (other than by airline) that originates in one
15 state or jurisdiction and terminates in another state or
16 jurisdiction, that is determined by the ratio that the
17 miles traveled in this State bears to total miles
18 everywhere and (b) the denominator of which shall be all
19 revenue derived from the movement or shipment of people,
20 goods, mail, oil, gas, or any other substance (other than
21 by airline). Where a taxpayer is engaged in the
22 transportation of both passengers and freight, the
23 fraction above referred to shall first be determined
24 separately for passenger miles and freight miles. Then an
25 average of the passenger miles fraction and the freight
26 miles fraction shall be weighted to reflect the taxpayer's:

09800SB1739ham002- 194 -LRB098 10559 AMC 46792 a
1 (A) relative railway operating income from total
2 passenger and total freight service, as reported to the
3 Surface Transportation Board, in the case of
4 transportation by railroad; and
5 (B) relative gross receipts from passenger and
6 freight transportation, in case of transportation
7 other than by railroad.
8 (4) For taxable years ending on or after December 31,
9 2008, business income derived from furnishing airline
10 transportation services shall be apportioned to this State
11 by multiplying such income by a fraction, the numerator of
12 which is the revenue miles of the person in this State, and
13 the denominator of which is the revenue miles of the person
14 everywhere. For purposes of this paragraph, a revenue mile
15 is the transportation of one passenger or one net ton of
16 freight the distance of one mile for a consideration. If a
17 person is engaged in the transportation of both passengers
18 and freight, the fraction above referred to shall be
19 determined by means of an average of the passenger revenue
20 mile fraction and the freight revenue mile fraction,
21 weighted to reflect the person's relative gross receipts
22 from passenger and freight airline transportation.
23 (e) Combined apportionment. Where 2 or more persons are
24engaged in a unitary business as described in subsection
25(a)(27) of Section 1501, a part of which is conducted in this
26State by one or more members of the group, the business income

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1attributable to this State by any such member or members shall
2be apportioned by means of the combined apportionment method.
3 (f) Alternative allocation. If the allocation and
4apportionment provisions of subsections (a) through (e) and of
5subsection (h) do not fairly represent the extent of a person's
6business activity in this State, the person may petition for,
7or the Director may, without a petition, permit or require, in
8respect of all or any part of the person's business activity,
9if reasonable:
10 (1) Separate accounting;
11 (2) The exclusion of any one or more factors;
12 (3) The inclusion of one or more additional factors
13 which will fairly represent the person's business
14 activities in this State; or
15 (4) The employment of any other method to effectuate an
16 equitable allocation and apportionment of the person's
17 business income.
18 (g) Cross reference. For allocation of business income by
19residents, see Section 301(a).
20 (h) For tax years ending on or after December 31, 1998, the
21apportionment factor of persons who apportion their business
22income to this State under subsection (a) shall be equal to:
23 (1) for tax years ending on or after December 31, 1998
24 and before December 31, 1999, 16 2/3% of the property
25 factor plus 16 2/3% of the payroll factor plus 66 2/3% of
26 the sales factor;

09800SB1739ham002- 196 -LRB098 10559 AMC 46792 a
1 (2) for tax years ending on or after December 31, 1999
2 and before December 31, 2000, 8 1/3% of the property factor
3 plus 8 1/3% of the payroll factor plus 83 1/3% of the sales
4 factor;
5 (3) for tax years ending on or after December 31, 2000,
6 the sales factor.
7If, in any tax year ending on or after December 31, 1998 and
8before December 31, 2000, the denominator of the payroll,
9property, or sales factor is zero, the apportionment factor
10computed in paragraph (1) or (2) of this subsection for that
11year shall be divided by an amount equal to 100% minus the
12percentage weight given to each factor whose denominator is
13equal to zero.
14(Source: P.A. 96-763, eff. 8-25-09; 97-507, eff. 8-23-11;
1597-636, eff. 6-1-12.)
16 (35 ILCS 5/710) (from Ch. 120, par. 7-710)
17 Sec. 710. Withholding from lottery winnings.
18 (a) In General.
19 (1) Any person making a payment to a resident or
20 nonresident of winnings under the Illinois Lottery Law and
21 not required to withhold Illinois income tax from such
22 payment under Subsection (b) of Section 701 of this Act
23 because those winnings are not subject to Federal income
24 tax withholding, must withhold Illinois income tax from
25 such payment at a rate equal to the percentage tax rate for

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1 individuals provided in subsection (b) of Section 201,
2 provided that withholding is not required if such payment
3 of winnings is less than $1,000.
4 (2) Any person making a payment after December 31, 2013
5 to a resident or nonresident of winnings from pari-mutuel
6 wagering conducted at a wagering facility licensed under
7 the Illinois Horse Racing Act of 1975 or from gambling
8 games conducted on a riverboat or in a casino or electronic
9 gaming facility licensed under the Illinois Gambling Act
10 must withhold Illinois income tax from such payment at a
11 rate equal to the percentage tax rate for individuals
12 provided in subsection (b) of Section 201, provided that
13 the person making the payment is required to withhold under
14 Section 3402(q) of the Internal Revenue Code.
15 (b) Credit for taxes withheld. Any amount withheld under
16Subsection (a) shall be a credit against the Illinois income
17tax liability of the person to whom the payment of winnings was
18made for the taxable year in which that person incurred an
19Illinois income tax liability with respect to those winnings.
20(Source: P.A. 85-731.)
21 Section 90-23. The Property Tax Code is amended by adding
22Section 15-144 as follows:
23 (35 ILCS 200/15-144 new)
24 Sec. 15-144. Chicago Casino Development Authority. All

09800SB1739ham002- 198 -LRB098 10559 AMC 46792 a
1property owned by the Chicago Casino Development Authority is
2exempt. Any property owned by the Chicago Casino Development
3Authority and leased to any other entity is not exempt.
4 Section 90-24. The Illinois Municipal Code is amended by
5adding Section 8-10-2.6 as follows:
6 (65 ILCS 5/8-10-2.6 new)
7 Sec. 8-10-2.6. Chicago Casino Development Authority.
8Except as otherwise provided in the Chicago Casino Development
9Authority Act, this Division 10 applies to purchase orders and
10contracts relating to the Chicago Casino Development
11Authority.
12 Section 90-25. The Joliet Regional Port District Act is
13amended by changing Section 5.1 as follows:
14 (70 ILCS 1825/5.1) (from Ch. 19, par. 255.1)
15 Sec. 5.1. Riverboat and casino gambling. Notwithstanding
16any other provision of this Act, the District may not regulate
17the operation, conduct, or navigation of any riverboat gambling
18casino licensed under the Illinois Riverboat Gambling Act, and
19the District may not license, tax, or otherwise levy any
20assessment of any kind on any riverboat gambling casino
21licensed under the Illinois Riverboat Gambling Act. The General
22Assembly declares that the powers to regulate the operation,

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1conduct, and navigation of riverboat gambling casinos and to
2license, tax, and levy assessments upon riverboat gambling
3casinos are exclusive powers of the State of Illinois and the
4Illinois Gaming Board as provided in the Illinois Riverboat
5Gambling Act.
6(Source: P.A. 87-1175.)
7 Section 90-30. The Consumer Installment Loan Act is amended
8by changing Section 12.5 as follows:
9 (205 ILCS 670/12.5)
10 Sec. 12.5. Limited purpose branch.
11 (a) Upon the written approval of the Director, a licensee
12may maintain a limited purpose branch for the sole purpose of
13making loans as permitted by this Act. A limited purpose branch
14may include an automatic loan machine. No other activity shall
15be conducted at the site, including but not limited to,
16accepting payments, servicing the accounts, or collections.
17 (b) The licensee must submit an application for a limited
18purpose branch to the Director on forms prescribed by the
19Director with an application fee of $300. The approval for the
20limited purpose branch must be renewed concurrently with the
21renewal of the licensee's license along with a renewal fee of
22$300 for the limited purpose branch.
23 (c) The books, accounts, records, and files of the limited
24purpose branch's transactions shall be maintained at the

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1licensee's licensed location. The licensee shall notify the
2Director of the licensed location at which the books, accounts,
3records, and files shall be maintained.
4 (d) The licensee shall prominently display at the limited
5purpose branch the address and telephone number of the
6licensee's licensed location.
7 (e) No other business shall be conducted at the site of the
8limited purpose branch unless authorized by the Director.
9 (f) The Director shall make and enforce reasonable rules
10for the conduct of a limited purpose branch.
11 (g) A limited purpose branch may not be located within
121,000 feet of a facility operated by an inter-track wagering
13licensee or an organization licensee subject to the Illinois
14Horse Racing Act of 1975, on a riverboat or in a casino subject
15to the Illinois Riverboat Gambling Act, or within 1,000 feet of
16the location at which the riverboat docks or within 1,000 feet
17of a casino.
18(Source: P.A. 90-437, eff. 1-1-98.)
19 Section 90-35. The Illinois Horse Racing Act of 1975 is
20amended by changing Sections 1.2, 3.11, 3.12, 6, 9, 15, 18, 19,
2120, 21, 24, 25, 26, 27, 30, 30.5, 31, 31.1, 32.1, 36, 40, and
2254.75 and by adding Sections 3.31, 3.32, 3.33, 3.35, 3.36,
2334.3, 39.2, and 56 as follows:
24 (230 ILCS 5/1.2)

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1 Sec. 1.2. Legislative intent. This Act is intended to
2benefit the people of the State of Illinois by encouraging the
3breeding and production of race horses, assisting economic
4development and promoting Illinois tourism. The General
5Assembly finds and declares it to be the public policy of the
6State of Illinois to:
7 (a) support and enhance Illinois' horse racing industry,
8which is a significant component within the agribusiness
9industry;
10 (b) ensure that Illinois' horse racing industry remains
11competitive with neighboring states;
12 (c) stimulate growth within Illinois' horse racing
13industry, thereby encouraging new investment and development
14to produce additional tax revenues and to create additional
15jobs;
16 (d) promote the further growth of tourism;
17 (e) encourage the breeding of thoroughbred and
18standardbred horses in this State; and
19 (f) ensure that public confidence and trust in the
20credibility and integrity of racing operations and the
21regulatory process is maintained.
22(Source: P.A. 91-40, eff. 6-25-99.)
23 (230 ILCS 5/3.11) (from Ch. 8, par. 37-3.11)
24 Sec. 3.11. "Organization Licensee" means any person
25receiving an organization license from the Board to conduct a

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1race meeting or meetings. With respect only to electronic
2gaming, "organization licensee" includes the authorization for
3an electronic gaming license under subsection (a) of Section 56
4of this Act.
5(Source: P.A. 79-1185.)
6 (230 ILCS 5/3.12) (from Ch. 8, par. 37-3.12)
7 Sec. 3.12. Pari-mutuel system of wagering. "Pari-mutuel
8system of wagering" means a form of wagering on the outcome of
9horse races in which wagers are made in various denominations
10on a horse or horses and all wagers for each race are pooled
11and held by a licensee for distribution in a manner approved by
12the Board. "Pari-mutuel system of wagering" shall not include
13wagering on historic races. Wagers may be placed via any method
14or at any location authorized under this Act.
15(Source: P.A. 96-762, eff. 8-25-09.)
16 (230 ILCS 5/3.31 new)
17 Sec. 3.31. Adjusted gross receipts. "Adjusted gross
18receipts" means the gross receipts less winnings paid to
19wagerers.
20 (230 ILCS 5/3.32 new)
21 Sec. 3.32. Gross receipts. "Gross receipts" means the total
22amount of money exchanged for the purchase of chips, tokens, or
23electronic cards by riverboat or casino patrons or electronic

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1gaming patrons.
2 (230 ILCS 5/3.33 new)
3 Sec. 3.33. Electronic gaming. "Electronic gaming" means
4slot machine gambling, video game of chance gambling, or
5gambling with electronic gambling games as defined in the
6Illinois Gambling Act or defined by the Illinois Gaming Board
7that is conducted at a race track pursuant to an electronic
8gaming license.
9 (230 ILCS 5/3.35 new)
10 Sec. 3.35. Electronic gaming license. "Electronic gaming
11license" means a license issued by the Illinois Gaming Board
12under Section 7.6 of the Illinois Gambling Act authorizing
13electronic gaming at an electronic gaming facility.
14 (230 ILCS 5/3.36 new)
15 Sec. 3.36. Electronic gaming facility. "Electronic gaming
16facility" means that portion of an organization licensee's race
17track facility at which electronic gaming is conducted.
18 (230 ILCS 5/6) (from Ch. 8, par. 37-6)
19 Sec. 6. Restrictions on Board members.
20 (a) No person shall be appointed a member of the Board or
21continue to be a member of the Board if the person or any
22member of their immediate family is a member of the Board of

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1Directors, employee, or financially interested in any of the
2following: (i) any licensee or other person who has applied for
3racing dates to the Board, or the operations thereof including,
4but not limited to, concessions, data processing, track
5maintenance, track security, and pari-mutuel operations,
6located, scheduled or doing business within the State of
7Illinois, (ii) any race horse competing at a meeting under the
8Board's jurisdiction, or (iii) any licensee under the Illinois
9Gambling Act. No person shall be appointed a member of the
10Board or continue to be a member of the Board who is (or any
11member of whose family is) a member of the Board of Directors
12of, or who is a person financially interested in, any licensee
13or other person who has applied for racing dates to the Board,
14or the operations thereof including, but not limited to,
15concessions, data processing, track maintenance, track
16security and pari-mutuel operations, located, scheduled or
17doing business within the State of Illinois, or in any race
18horse competing at a meeting under the Board's jurisdiction. No
19Board member shall hold any other public office for which he
20shall receive compensation other than necessary travel or other
21incidental expenses.
22 (b) No person shall be a member of the Board who is not of
23good moral character or who has been convicted of, or is under
24indictment for, a felony under the laws of Illinois or any
25other state, or the United States.
26 (c) No member of the Board or employee shall engage in any

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1political activity.
2 For the purposes of this subsection (c):
3 "Political" means any activity in support of or in
4connection with any campaign for State or local elective office
5or any political organization, but does not include activities
6(i) relating to the support or opposition of any executive,
7legislative, or administrative action (as those terms are
8defined in Section 2 of the Lobbyist Registration Act), (ii)
9relating to collective bargaining, or (iii) that are otherwise
10in furtherance of the person's official State duties or
11governmental and public service functions.
12 "Political organization" means a party, committee,
13association, fund, or other organization (whether or not
14incorporated) that is required to file a statement of
15organization with the State Board of Elections or county clerk
16under Section 9-3 of the Election Code, but only with regard to
17those activities that require filing with the State Board of
18Elections or county clerk.
19 (d) Board members and employees may not engage in
20communications or any activity that may cause or have the
21appearance of causing a conflict of interest. A conflict of
22interest exists if a situation influences or creates the
23appearance that it may influence judgment or performance of
24regulatory duties and responsibilities. This prohibition shall
25extend to any act identified by Board action that, in the
26judgment of the Board, could represent the potential for or the

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1appearance of a conflict of interest.
2 (e) Board members and employees may not accept any gift,
3gratuity, service, compensation, travel, lodging, or thing of
4value, with the exception of unsolicited items of an incidental
5nature, from any person, corporation, limited liability
6company, or entity doing business with the Board.
7 (f) A Board member or employee shall not use or attempt to
8use his or her official position to secure, or attempt to
9secure, any privilege, advantage, favor, or influence for
10himself or herself or others. No Board member or employee,
11within a period of one year immediately preceding nomination by
12the Governor or employment, shall have been employed or
13received compensation or fees for services from a person or
14entity, or its parent or affiliate, that has engaged in
15business with the Board, a licensee or a licensee under the
16Illinois Gambling Act. In addition, all Board members and
17employees are subject to the restrictions set forth in Section
185-45 of the State Officials and Employees Ethics Act.
19(Source: P.A. 89-16, eff. 5-30-95.)
20 (230 ILCS 5/9) (from Ch. 8, par. 37-9)
21 Sec. 9. The Board shall have all powers necessary and
22proper to fully and effectively execute the provisions of this
23Act, including, but not limited to, the following:
24 (a) The Board is vested with jurisdiction and supervision
25over all race meetings in this State, over all licensees doing

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1business in this State, over all occupation licensees, and over
2all persons on the facilities of any licensee. Such
3jurisdiction shall include the power to issue licenses to the
4Illinois Department of Agriculture authorizing the pari-mutuel
5system of wagering on harness and Quarter Horse races held (1)
6at the Illinois State Fair in Sangamon County, and (2) at the
7DuQuoin State Fair in Perry County. The jurisdiction of the
8Board shall also include the power to issue licenses to county
9fairs which are eligible to receive funds pursuant to the
10Agricultural Fair Act, as now or hereafter amended, or their
11agents, authorizing the pari-mutuel system of wagering on horse
12races conducted at the county fairs receiving such licenses.
13Such licenses shall be governed by subsection (n) of this
14Section.
15 Upon application, the Board shall issue a license to the
16Illinois Department of Agriculture to conduct harness and
17Quarter Horse races at the Illinois State Fair and at the
18DuQuoin State Fairgrounds during the scheduled dates of each
19fair. The Board shall not require and the Department of
20Agriculture shall be exempt from the requirements of Sections
2115.3, 18 and 19, paragraphs (a)(2), (b), (c), (d), (e), (e-5),
22(e-10), (f), (g), and (h) of Section 20, and Sections 21, 24
23and 25. The Board and the Department of Agriculture may extend
24any or all of these exemptions to any contractor or agent
25engaged by the Department of Agriculture to conduct its race
26meetings when the Board determines that this would best serve

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1the public interest and the interest of horse racing.
2 Notwithstanding any provision of law to the contrary, it
3shall be lawful for any licensee to operate pari-mutuel
4wagering or contract with the Department of Agriculture to
5operate pari-mutuel wagering at the DuQuoin State Fairgrounds
6or for the Department to enter into contracts with a licensee,
7employ its owners, employees or agents and employ such other
8occupation licensees as the Department deems necessary in
9connection with race meetings and wagerings.
10 (b) The Board is vested with the full power to promulgate
11reasonable rules and regulations for the purpose of
12administering the provisions of this Act and to prescribe
13reasonable rules, regulations and conditions under which all
14horse race meetings or wagering in the State shall be
15conducted. Such reasonable rules and regulations are to provide
16for the prevention of practices detrimental to the public
17interest and to promote the best interests of horse racing and
18to impose penalties for violations thereof.
19 (c) The Board, and any person or persons to whom it
20delegates this power, is vested with the power to enter the
21facilities and other places of business of any licensee to
22determine whether there has been compliance with the provisions
23of this Act and its rules and regulations.
24 (d) The Board, and any person or persons to whom it
25delegates this power, is vested with the authority to
26investigate alleged violations of the provisions of this Act,

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1its reasonable rules and regulations, orders and final
2decisions; the Board shall take appropriate disciplinary
3action against any licensee or occupation licensee for
4violation thereof or institute appropriate legal action for the
5enforcement thereof.
6 (e) The Board, and any person or persons to whom it
7delegates this power, may eject or exclude from any race
8meeting or the facilities of any licensee, or any part thereof,
9any occupation licensee or any other individual whose conduct
10or reputation is such that his presence on those facilities
11may, in the opinion of the Board, call into question the
12honesty and integrity of horse racing or wagering or interfere
13with the orderly conduct of horse racing or wagering; provided,
14however, that no person shall be excluded or ejected from the
15facilities of any licensee solely on the grounds of race,
16color, creed, national origin, ancestry, or sex. The power to
17eject or exclude an occupation licensee or other individual may
18be exercised for just cause by the licensee or the Board,
19subject to subsequent hearing by the Board as to the propriety
20of said exclusion.
21 (f) The Board is vested with the power to acquire,
22establish, maintain and operate (or provide by contract to
23maintain and operate) testing laboratories and related
24facilities, for the purpose of conducting saliva, blood, urine
25and other tests on the horses run or to be run in any horse race
26meeting, including races run at county fairs, and to purchase

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1all equipment and supplies deemed necessary or desirable in
2connection with any such testing laboratories and related
3facilities and all such tests.
4 (g) The Board may require that the records, including
5financial or other statements of any licensee or any person
6affiliated with the licensee who is involved directly or
7indirectly in the activities of any licensee as regulated under
8this Act to the extent that those financial or other statements
9relate to such activities be kept in such manner as prescribed
10by the Board, and that Board employees shall have access to
11those records during reasonable business hours. Within 120 days
12of the end of its fiscal year, each licensee shall transmit to
13the Board an audit of the financial transactions and condition
14of the licensee's total operations. All audits shall be
15conducted by certified public accountants. Each certified
16public accountant must be registered in the State of Illinois
17under the Illinois Public Accounting Act. The compensation for
18each certified public accountant shall be paid directly by the
19licensee to the certified public accountant. A licensee shall
20also submit any other financial or related information the
21Board deems necessary to effectively administer this Act and
22all rules, regulations, and final decisions promulgated under
23this Act.
24 (h) The Board shall name and appoint in the manner provided
25by the rules and regulations of the Board: an Executive
26Director; a State director of mutuels; State veterinarians and

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1representatives to take saliva, blood, urine and other tests on
2horses; licensing personnel; revenue inspectors; and State
3seasonal employees (excluding admission ticket sellers and
4mutuel clerks). All of those named and appointed as provided in
5this subsection shall serve during the pleasure of the Board;
6their compensation shall be determined by the Board and be paid
7in the same manner as other employees of the Board under this
8Act.
9 (i) The Board shall require that there shall be 3 stewards
10at each horse race meeting, at least 2 of whom shall be named
11and appointed by the Board. Stewards appointed or approved by
12the Board, while performing duties required by this Act or by
13the Board, shall be entitled to the same rights and immunities
14as granted to Board members and Board employees in Section 10
15of this Act.
16 (j) The Board may discharge any Board employee who fails or
17refuses for any reason to comply with the rules and regulations
18of the Board, or who, in the opinion of the Board, is guilty of
19fraud, dishonesty or who is proven to be incompetent. The Board
20shall have no right or power to determine who shall be
21officers, directors or employees of any licensee, or their
22salaries except the Board may, by rule, require that all or any
23officials or employees in charge of or whose duties relate to
24the actual running of races be approved by the Board.
25 (k) The Board is vested with the power to appoint delegates
26to execute any of the powers granted to it under this Section

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1for the purpose of administering this Act and any rules or
2regulations promulgated in accordance with this Act.
3 (l) The Board is vested with the power to impose civil
4penalties of up to $5,000 against an individual and up to
5$10,000 against a licensee for each violation of any provision
6of this Act, any rules adopted by the Board, any order of the
7Board or any other action which, in the Board's discretion, is
8a detriment or impediment to horse racing or wagering.
9Beginning on the date when any organization licensee begins
10conducting electronic gaming pursuant to an electronic gaming
11license issued under the Illinois Gambling Act, the power
12granted to the Board pursuant to this subsection (l) shall
13authorize the Board to impose penalties of up to $10,000
14against an individual and up to $25,000 against a licensee. All
15such civil penalties shall be deposited into the Horse Racing
16Fund.
17 (m) The Board is vested with the power to prescribe a form
18to be used by licensees as an application for employment for
19employees of each licensee.
20 (n) The Board shall have the power to issue a license to
21any county fair, or its agent, authorizing the conduct of the
22pari-mutuel system of wagering. The Board is vested with the
23full power to promulgate reasonable rules, regulations and
24conditions under which all horse race meetings licensed
25pursuant to this subsection shall be held and conducted,
26including rules, regulations and conditions for the conduct of

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1the pari-mutuel system of wagering. The rules, regulations and
2conditions shall provide for the prevention of practices
3detrimental to the public interest and for the best interests
4of horse racing, and shall prescribe penalties for violations
5thereof. Any authority granted the Board under this Act shall
6extend to its jurisdiction and supervision over county fairs,
7or their agents, licensed pursuant to this subsection. However,
8the Board may waive any provision of this Act or its rules or
9regulations which would otherwise apply to such county fairs or
10their agents.
11 (o) Whenever the Board is authorized or required by law to
12consider some aspect of criminal history record information for
13the purpose of carrying out its statutory powers and
14responsibilities, then, upon request and payment of fees in
15conformance with the requirements of Section 2605-400 of the
16Department of State Police Law (20 ILCS 2605/2605-400), the
17Department of State Police is authorized to furnish, pursuant
18to positive identification, such information contained in
19State files as is necessary to fulfill the request.
20 (p) To insure the convenience, comfort, and wagering
21accessibility of race track patrons, to provide for the
22maximization of State revenue, and to generate increases in
23purse allotments to the horsemen, the Board shall require any
24licensee to staff the pari-mutuel department with adequate
25personnel.
26(Source: P.A. 97-1060, eff. 8-24-12.)

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1 (230 ILCS 5/15) (from Ch. 8, par. 37-15)
2 Sec. 15. (a) The Board shall, in its discretion, issue
3occupation licenses to horse owners, trainers, harness
4drivers, jockeys, agents, apprentices, grooms, stable foremen,
5exercise persons, veterinarians, valets, blacksmiths,
6concessionaires and others designated by the Board whose work,
7in whole or in part, is conducted upon facilities within the
8State. Such occupation licenses will be obtained prior to the
9persons engaging in their vocation upon such facilities. The
10Board shall not license pari-mutuel clerks, parking
11attendants, security guards and employees of concessionaires.
12No occupation license shall be required of any person who works
13at facilities within this State as a pari-mutuel clerk, parking
14attendant, security guard or as an employee of a
15concessionaire. Concessionaires of the Illinois State Fair and
16DuQuoin State Fair and employees of the Illinois Department of
17Agriculture shall not be required to obtain an occupation
18license by the Board.
19 (b) Each application for an occupation license shall be on
20forms prescribed by the Board. Such license, when issued, shall
21be for the period ending December 31 of each year, except that
22the Board in its discretion may grant 3-year licenses. The
23application shall be accompanied by a fee of not more than $25
24per year or, in the case of 3-year occupation license
25applications, a fee of not more than $60. Each applicant shall

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1set forth in the application his full name and address, and if
2he had been issued prior occupation licenses or has been
3licensed in any other state under any other name, such name,
4his age, whether or not a permit or license issued to him in
5any other state has been suspended or revoked and if so whether
6such suspension or revocation is in effect at the time of the
7application, and such other information as the Board may
8require. Fees for registration of stable names shall not exceed
9$50.00. Beginning on the date when any organization licensee
10begins conducting electronic gaming pursuant to an electronic
11gambling license issued under the Illinois Gambling Act, the
12fee for registration of stable names shall not exceed $150, and
13the application fee for an occupation license shall not exceed
14$75, per year or, in the case of a 3-year occupation license
15application, the fee shall not exceed $180.
16 (c) The Board may in its discretion refuse an occupation
17license to any person:
18 (1) who has been convicted of a crime;
19 (2) who is unqualified to perform the duties required
20 of such applicant;
21 (3) who fails to disclose or states falsely any
22 information called for in the application;
23 (4) who has been found guilty of a violation of this
24 Act or of the rules and regulations of the Board; or
25 (5) whose license or permit has been suspended, revoked
26 or denied for just cause in any other state.

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1 (d) The Board may suspend or revoke any occupation license:
2 (1) for violation of any of the provisions of this Act;
3 or
4 (2) for violation of any of the rules or regulations of
5 the Board; or
6 (3) for any cause which, if known to the Board, would
7 have justified the Board in refusing to issue such
8 occupation license; or
9 (4) for any other just cause.
10 (e) Each applicant shall submit his or her fingerprints
11to the Department of State Police in the form and manner
12prescribed by the Department of State Police. These
13fingerprints shall be checked against the fingerprint records
14now and hereafter filed in the Department of State Police and
15Federal Bureau of Investigation criminal history records
16databases. The Department of State Police shall charge a fee
17for conducting the criminal history records check, which shall
18be deposited in the State Police Services Fund and shall not
19exceed the actual cost of the records check. The Department of
20State Police shall furnish, pursuant to positive
21identification, records of conviction to the Board. Each
22applicant for licensure shall submit with his occupation
23license application, on forms provided by the Board, 2 sets of
24his fingerprints. All such applicants shall appear in person at
25the location designated by the Board for the purpose of
26submitting such sets of fingerprints; however, with the prior

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1approval of a State steward, an applicant may have such sets of
2fingerprints taken by an official law enforcement agency and
3submitted to the Board.
4 (f) The Board may, in its discretion, issue an occupation
5license without submission of fingerprints if an applicant has
6been duly licensed in another recognized racing jurisdiction
7after submitting fingerprints that were subjected to a Federal
8Bureau of Investigation criminal history background check in
9that jurisdiction.
10 (g) Beginning on the date when any organization licensee
11begins conducting electronic gambling pursuant to an
12electronic gaming license issued under the Illinois Gambling
13Act, the Board may charge each applicant a reasonable
14non-refundable fee to defray the costs associated with the
15background investigation conducted by the Board. This fee shall
16be exclusive of any other fee or fees charged in connection
17with an application for and, if applicable, the issuance of, an
18electronic gaming license. If the costs of the investigation
19exceed the amount of the fee charged, the Board shall
20immediately notify the applicant of the additional amount owed,
21payment of which must be submitted to the Board within 7 days
22after such notification. All information, records, interviews,
23reports, statements, memoranda, or other data supplied to or
24used by the Board in the course of its review or investigation
25of an applicant for a license or renewal under this Act shall
26be privileged, strictly confidential, and shall be used only

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1for the purpose of evaluating an applicant for a license or a
2renewal. Such information, records, interviews, reports,
3statements, memoranda, or other data shall not be admissible as
4evidence, nor discoverable, in any action of any kind in any
5court or before any tribunal, board, agency, or person, except
6for any action deemed necessary by the Board.
7(Source: P.A. 93-418, eff. 1-1-04.)
8 (230 ILCS 5/18) (from Ch. 8, par. 37-18)
9 Sec. 18. (a) Together with its application, each applicant
10for racing dates shall deliver to the Board a certified check
11or bank draft payable to the order of the Board for $1,000. In
12the event the applicant applies for racing dates in 2 or 3
13successive calendar years as provided in subsection (b) of
14Section 21, the fee shall be $2,000. Filing fees shall not be
15refunded in the event the application is denied. Beginning on
16the date when any organization licensee begins conducting
17electronic gaming pursuant to an electronic gaming license
18issued under the Illinois Gambling Act, the application fee for
19racing dates imposed by this subsection (a) shall be $10,000
20and the application fee for racing dates in 2 or 3 successive
21calendar years as provided in subsection (b) of Section 21
22shall be $20,000. All filing fees shall be deposited into the
23Horse Racing Fund.
24 (b) In addition to the filing fee imposed by subsection (a)
25of $1000 and the fees provided in subsection (j) of Section 20,

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1each organization licensee shall pay a license fee of $100 for
2each racing program on which its daily pari-mutuel handle is
3$400,000 or more but less than $700,000, and a license fee of
4$200 for each racing program on which its daily pari-mutuel
5handle is $700,000 or more. The additional fees required to be
6paid under this Section by this amendatory Act of 1982 shall be
7remitted by the organization licensee to the Illinois Racing
8Board with each day's graduated privilege tax or pari-mutuel
9tax and breakage as provided under Section 27. Beginning on the
10date when any organization licensee begins conducting
11electronic gaming pursuant to an electronic gaming license
12issued under the Illinois Gambling Act, the license fee imposed
13by this subsection (b) shall be $200 for each racing program on
14which the organization licensee's daily pari-mutuel handle is
15$100,000 or more, but less than $400,000, and the license fee
16imposed by this subsection (b) shall be $400 for each racing
17program on which the organization licensee's daily pari-mutuel
18handle is $400,000 or more.
19 (c) Sections 11-42-1, 11-42-5, and 11-54-1 of the "Illinois
20Municipal Code," approved May 29, 1961, as now or hereafter
21amended, shall not apply to any license under this Act.
22(Source: P.A. 97-1060, eff. 8-24-12.)
23 (230 ILCS 5/19) (from Ch. 8, par. 37-19)
24 Sec. 19. (a) No organization license may be granted to
25conduct a horse race meeting:

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1 (1) except as provided in subsection (c) of Section 21
2 of this Act, to any person at any place within 35 miles of
3 any other place licensed by the Board to hold a race
4 meeting on the same date during the same hours, the mileage
5 measurement used in this subsection (a) shall be certified
6 to the Board by the Bureau of Systems and Services in the
7 Illinois Department of Transportation as the most commonly
8 used public way of vehicular travel;
9 (2) to any person in default in the payment of any
10 obligation or debt due the State under this Act, provided
11 no applicant shall be deemed in default in the payment of
12 any obligation or debt due to the State under this Act as
13 long as there is pending a hearing of any kind relevant to
14 such matter;
15 (3) to any person who has been convicted of the
16 violation of any law of the United States or any State law
17 which provided as all or part of its penalty imprisonment
18 in any penal institution; to any person against whom there
19 is pending a Federal or State criminal charge; to any
20 person who is or has been connected with or engaged in the
21 operation of any illegal business; to any person who does
22 not enjoy a general reputation in his community of being an
23 honest, upright, law-abiding person; provided that none of
24 the matters set forth in this subparagraph (3) shall make
25 any person ineligible to be granted an organization license
26 if the Board determines, based on circumstances of any such

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1 case, that the granting of a license would not be
2 detrimental to the interests of horse racing and of the
3 public;
4 (4) to any person who does not at the time of
5 application for the organization license own or have a
6 contract or lease for the possession of a finished race
7 track suitable for the type of racing intended to be held
8 by the applicant and for the accommodation of the public.
9 (b) (Blank) Horse racing on Sunday shall be prohibited
10unless authorized by ordinance or referendum of the
11municipality in which a race track or any of its appurtenances
12or facilities are located, or utilized.
13 (c) If any person is ineligible to receive an organization
14license because of any of the matters set forth in subsection
15(a) (2) or subsection (a) (3) of this Section, any other or
16separate person that either (i) controls, directly or
17indirectly, such ineligible person or (ii) is controlled,
18directly or indirectly, by such ineligible person or by a
19person which controls, directly or indirectly, such ineligible
20person shall also be ineligible.
21(Source: P.A. 88-495; 89-16, eff. 5-30-95.)
22 (230 ILCS 5/20) (from Ch. 8, par. 37-20)
23 Sec. 20. (a) Any person desiring to conduct a horse race
24meeting may apply to the Board for an organization license. The
25application shall be made on a form prescribed and furnished by

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1the Board. The application shall specify:
2 (1) the dates on which it intends to conduct the horse
3 race meeting, which dates shall be provided under Section
4 21;
5 (2) the hours of each racing day between which it
6 intends to hold or conduct horse racing at such meeting;
7 (3) the location where it proposes to conduct the
8 meeting; and
9 (4) any other information the Board may reasonably
10 require.
11 (b) A separate application for an organization license
12shall be filed for each horse race meeting which such person
13proposes to hold. Any such application, if made by an
14individual, or by any individual as trustee, shall be signed
15and verified under oath by such individual. If the application
16is made by individuals, then it shall be signed and verified
17under oath by at least 2 of the individuals; if the application
18is made by or a partnership, it shall be signed and verified
19under oath by at least 2 of such individuals or members of such
20partnership as the case may be. If made by an association, a
21corporation, a corporate trustee, a limited liability company,
22or any other entity, it shall be signed by an authorized
23officer, a partner, a member, or a manager, as the case may be,
24of the entity the president and attested by the secretary or
25assistant secretary under the seal of such association, trust
26or corporation if it has a seal, and shall also be verified

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1under oath by one of the signing officers.
2 (c) The application shall specify:
3 (1) the name of the persons, association, trust, or
4 corporation making such application; and
5 (2) the principal post office address of the applicant;
6 (3) if the applicant is a trustee, the names and
7 addresses of the beneficiaries; if the applicant is a
8 corporation, the names and post office addresses of all
9 officers, stockholders and directors; or if such
10 stockholders hold stock as a nominee or fiduciary, the
11 names and post office addresses of the parties these
12 persons, partnerships, corporations, or trusts who are the
13 beneficial owners thereof or who are beneficially
14 interested therein; and if the applicant is a partnership,
15 the names and post office addresses of all partners,
16 general or limited; if the applicant is a limited liability
17 company, the names and addresses of the manager and
18 members; and if the applicant is any other entity, the
19 names and addresses of all officers or other authorized
20 persons of the entity corporation, the name of the state of
21 its incorporation shall be specified.
22 (d) The applicant shall execute and file with the Board a
23good faith affirmative action plan to recruit, train, and
24upgrade minorities in all classifications within the
25association.
26 (e) With such application there shall be delivered to the

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1Board a certified check or bank draft payable to the order of
2the Board for an amount equal to $1,000. All applications for
3the issuance of an organization license shall be filed with the
4Board before August 1 of the year prior to the year for which
5application is made and shall be acted upon by the Board at a
6meeting to be held on such date as shall be fixed by the Board
7during the last 15 days of September of such prior year. At
8such meeting, the Board shall announce the award of the racing
9meets, live racing schedule, and designation of host track to
10the applicants and its approval or disapproval of each
11application. No announcement shall be considered binding until
12a formal order is executed by the Board, which shall be
13executed no later than October 15 of that prior year. Absent
14the agreement of the affected organization licensees, the Board
15shall not grant overlapping race meetings to 2 or more tracks
16that are within 100 miles of each other to conduct the
17thoroughbred racing.
18 (e-1) In awarding standardbred racing dates for calendar
19year 2014 and thereafter, the Board shall award at least 310
20racing days, and each organization licensee shall average at
21least 12 races for each racing day awarded. The Board shall
22have the discretion to allocate those racing days among
23organization licensees requesting standardbred racing dates.
24Once awarded by the Board, organization licensees awarded
25standardbred racing dates shall run at least 3,500 races in
26total during that calendar year. Standardbred racing conducted

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1in Sangamon County shall not be considered races under this
2subsection (e-1).
3 (e-2) In awarding racing dates for calendar year 2014 and
4thereafter, the Board shall award thoroughbred racing days to
5Cook County organization licensees commensurate with these
6organization licensees' requirement that they shall run at
7least 1,950 thoroughbred races in the aggregate, so long as 2
8organization licensees are conducting electronic gaming
9operations. Additionally, if the organization licensees that
10run thoroughbred races in Cook County are conducting electronic
11gaming operations, the Board shall increase the number of
12thoroughbred races to be run in Cook County in the aggregate to
13at least the following:
14 (i) 2,050 races in any year following the most recent
15 preceding complete calendar year when the combined
16 adjusted gross receipts of the electronic gaming licensees
17 operating at Cook County race tracks total in excess of
18 $200,000,000, but do not exceed $250,000,000;
19 (ii) 2,125 races in any year following the most recent
20 preceding complete calendar year when the combined
21 adjusted gross receipts of the electronic gaming licensees
22 operating at Cook County race tracks total in excess of
23 $250,000,000, but do not exceed $300,000,000;
24 (iii) 2,200 races in any year following the most recent
25 preceding complete calendar year when the combined
26 adjusted gross receipts of the electronic gaming licensees

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1 operating at Cook County race tracks total in excess of
2 $300,000,000, but do not exceed $350,000,000;
3 (iv) 2,300 races in any year following the most recent
4 preceding complete calendar year when the combined
5 adjusted gross receipts of the electronic gaming licensees
6 operating at Cook County race tracks total in excess of
7 $350,000,000, but do not exceed $400,000,000;
8 (v) 2,375 races in any year following the most recent
9 preceding complete calendar year when the combined
10 adjusted gross receipts of the electronic gaming licensees
11 operating at Cook County race tracks total in excess of
12 $400,000,000, but do not exceed $450,000,000;
13 (vi) 2,450 races in any year following the most recent
14 preceding complete calendar year when the combined
15 adjusted gross receipts of the electronic gaming licensees
16 operating at Cook County race tracks total in excess of
17 $450,000,000, but do not exceed $500,000,000;
18 (vii) 2,550 races in any year following the most recent
19 preceding complete calendar year when the combined
20 adjusted gross receipts of the electronic gaming licensees
21 operating at Cook County race tracks exceeds $500,000,000.
22 In awarding racing dates under this subsection (e-2), the
23Board shall have the discretion to allocate those thoroughbred
24racing dates among these Cook County organization licensees.
25 (e-3) In awarding racing dates for calendar year 2014 and
26thereafter in connection with a race track in Madison County,

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1the Board shall award racing dates and such organization
2licensee shall run at least 700 thoroughbred races at the race
3track in Madison County each year.
4 Notwithstanding Section 7.6 of the Illinois Gambling Act or
5any provision of this Act other than subsection (e-4.5), for
6each calendar year for which an electronic gaming licensee
7located in Madison County requests racing dates resulting in
8less than 700 live thoroughbred races at its race track
9facility, the electronic gaming licensee may not conduct
10electronic gaming for the calendar year of such requested live
11races.
12 (e-4) Notwithstanding the provisions of Section 7.6 of the
13Illinois Gambling Act or any provision of this Act other than
14subsections (e-3) and (e-4.5), for each calendar year for which
15an electronic gaming licensee requests racing dates for a
16specific horse breed which results in a number of live races
17for that specific breed under its organization license that is
18less than the total number of live races for that specific
19breed which it conducted in 2011 for standardbred racing and in
202009 for thoroughbred racing at its race track facility, the
21electronic gaming licensee may not conduct electronic gaming
22for the calendar year of such requested live races.
23 (e-4.5) The Board shall ensure that each organization
24licensee shall individually run a sufficient number of races
25per year to qualify for an electronic gaming license under this
26Act. The General Assembly finds that the minimum live racing

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1guarantees contained in subsections (e-1), (e-2), and (e-3) are
2in the best interest of the sport of horse racing, and that
3such guarantees may only be reduced in the limited
4circumstances described in this subsection. The Board may
5decrease the number of racing days without affecting an
6organization licensee's ability to conduct electronic gaming
7only if the Board determines, after notice and hearing, that:
8 (i) a decrease is necessary to maintain a sufficient
9 number of betting interests per race to ensure the
10 integrity of racing;
11 (ii) there are unsafe track conditions due to weather
12 or acts of God;
13 (iii) there is an agreement between an organization
14 licensee and the breed association that is applicable to
15 the involved live racing guarantee, such association
16 representing either the largest number of thoroughbred
17 owners and trainers or the largest number of standardbred
18 owners, trainers and drivers who race horses at the
19 involved organization licensee's racing meeting, so long
20 as the agreement does not compromise the integrity of the
21 sport of horse racing; or
22 (iv) the horse population or purse levels are
23 insufficient to provide the number of racing opportunities
24 otherwise required in this Act.
25 In decreasing the number of racing dates in accordance with
26this subsection, the Board shall hold a hearing and shall

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1provide the public and all interested parties notice and an
2opportunity to be heard. The Board shall accept testimony from
3all interested parties, including any association representing
4owners, trainers, jockeys, or drivers who will be affected by
5the decrease in racing dates. The Board shall provide a written
6explanation of the reasons for the decrease and the Board's
7findings. The written explanation shall include a listing and
8content of all communication between any party and any Illinois
9Racing Board member or staff that does not take place at a
10public meeting of the Board.
11 (e-5) In reviewing an application for the purpose of
12granting an organization license consistent with the best
13interests of the public and the sport of horse racing, the
14Board shall consider:
15 (1) the character, reputation, experience, and
16 financial integrity of the applicant and of any other
17 separate person that either:
18 (i) controls the applicant, directly or
19 indirectly, or
20 (ii) is controlled, directly or indirectly, by
21 that applicant or by a person who controls, directly or
22 indirectly, that applicant;
23 (2) the applicant's facilities or proposed facilities
24 for conducting horse racing;
25 (3) the total revenue without regard to Section 32.1 to
26 be derived by the State and horsemen from the applicant's

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1 conducting a race meeting;
2 (4) the applicant's good faith affirmative action plan
3 to recruit, train, and upgrade minorities in all employment
4 classifications;
5 (5) the applicant's financial ability to purchase and
6 maintain adequate liability and casualty insurance;
7 (6) the applicant's proposed and prior year's
8 promotional and marketing activities and expenditures of
9 the applicant associated with those activities;
10 (7) an agreement, if any, among organization licensees
11 as provided in subsection (b) of Section 21 of this Act;
12 and
13 (8) the extent to which the applicant exceeds or meets
14 other standards for the issuance of an organization license
15 that the Board shall adopt by rule.
16 In granting organization licenses and allocating dates for
17horse race meetings, the Board shall have discretion to
18determine an overall schedule, including required simulcasts
19of Illinois races by host tracks that will, in its judgment, be
20conducive to the best interests of the public and the sport of
21horse racing.
22 (e-10) The Illinois Administrative Procedure Act shall
23apply to administrative procedures of the Board under this Act
24for the granting of an organization license, except that (1)
25notwithstanding the provisions of subsection (b) of Section
2610-40 of the Illinois Administrative Procedure Act regarding

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1cross-examination, the Board may prescribe rules limiting the
2right of an applicant or participant in any proceeding to award
3an organization license to conduct cross-examination of
4witnesses at that proceeding where that cross-examination
5would unduly obstruct the timely award of an organization
6license under subsection (e) of Section 20 of this Act; (2) the
7provisions of Section 10-45 of the Illinois Administrative
8Procedure Act regarding proposals for decision are excluded
9under this Act; (3) notwithstanding the provisions of
10subsection (a) of Section 10-60 of the Illinois Administrative
11Procedure Act regarding ex parte communications, the Board may
12prescribe rules allowing ex parte communications with
13applicants or participants in a proceeding to award an
14organization license where conducting those communications
15would be in the best interest of racing, provided all those
16communications are made part of the record of that proceeding
17pursuant to subsection (c) of Section 10-60 of the Illinois
18Administrative Procedure Act; (4) the provisions of Section 14a
19of this Act and the rules of the Board promulgated under that
20Section shall apply instead of the provisions of Article 10 of
21the Illinois Administrative Procedure Act regarding
22administrative law judges; and (5) the provisions of subsection
23(d) of Section 10-65 of the Illinois Administrative Procedure
24Act that prevent summary suspension of a license pending
25revocation or other action shall not apply.
26 (f) The Board may allot racing dates to an organization

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1licensee for more than one calendar year but for no more than 3
2successive calendar years in advance, provided that the Board
3shall review such allotment for more than one calendar year
4prior to each year for which such allotment has been made. The
5granting of an organization license to a person constitutes a
6privilege to conduct a horse race meeting under the provisions
7of this Act, and no person granted an organization license
8shall be deemed to have a vested interest, property right, or
9future expectation to receive an organization license in any
10subsequent year as a result of the granting of an organization
11license. Organization licenses shall be subject to revocation
12if the organization licensee has violated any provision of this
13Act or the rules and regulations promulgated under this Act or
14has been convicted of a crime or has failed to disclose or has
15stated falsely any information called for in the application
16for an organization license. Any organization license
17revocation proceeding shall be in accordance with Section 16
18regarding suspension and revocation of occupation licenses.
19 (f-5) If, (i) an applicant does not file an acceptance of
20the racing dates awarded by the Board as required under part
21(1) of subsection (h) of this Section 20, or (ii) an
22organization licensee has its license suspended or revoked
23under this Act, the Board, upon conducting an emergency hearing
24as provided for in this Act, may reaward on an emergency basis
25pursuant to rules established by the Board, racing dates not
26accepted or the racing dates associated with any suspension or

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1revocation period to one or more organization licensees, new
2applicants, or any combination thereof, upon terms and
3conditions that the Board determines are in the best interest
4of racing, provided, the organization licensees or new
5applicants receiving the awarded racing dates file an
6acceptance of those reawarded racing dates as required under
7paragraph (1) of subsection (h) of this Section 20 and comply
8with the other provisions of this Act. The Illinois
9Administrative Procedure Act shall not apply to the
10administrative procedures of the Board in conducting the
11emergency hearing and the reallocation of racing dates on an
12emergency basis.
13 (g) (Blank).
14 (h) The Board shall send the applicant a copy of its
15formally executed order by certified mail addressed to the
16applicant at the address stated in his application, which
17notice shall be mailed within 5 days of the date the formal
18order is executed.
19 Each applicant notified shall, within 10 days after receipt
20of the final executed order of the Board awarding racing dates:
21 (1) file with the Board an acceptance of such award in
22 the form prescribed by the Board;
23 (2) pay to the Board an additional amount equal to $110
24 for each racing date awarded; and
25 (3) file with the Board the bonds required in Sections
26 21 and 25 at least 20 days prior to the first day of each

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1 race meeting.
2Upon compliance with the provisions of paragraphs (1), (2), and
3(3) of this subsection (h), the applicant shall be issued an
4organization license.
5 If any applicant fails to comply with this Section or fails
6to pay the organization license fees herein provided, no
7organization license shall be issued to such applicant.
8(Source: P.A. 97-333, eff. 8-12-11.)
9 (230 ILCS 5/21) (from Ch. 8, par. 37-21)
10 Sec. 21. (a) Applications for organization licenses must be
11filed with the Board at a time and place prescribed by the
12rules and regulations of the Board. The Board shall examine the
13applications within 21 days after the date allowed for filing
14with respect to their conformity with this Act and such rules
15and regulations as may be prescribed by the Board. If any
16application does not comply with this Act or the rules and
17regulations prescribed by the Board, such application may be
18rejected and an organization license refused to the applicant,
19