Sen. Terry Link
Filed: 3/6/2013
 
 


 




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1
AMENDMENT TO SENATE BILL 1739




2 AMENDMENT NO. ______. Amend Senate Bill 1739 by replacing 
3everything after the enacting clause with the following:


4
"ARTICLE 1.


5 Section 1-1. Short title. This Article may be cited as the 
6Chicago Casino Development Authority Act. References in this 
7Article to "this Act" mean this Article.


8 Section 1-5. Definitions.
As used in this Act: 
9 "Authority" means the Chicago Casino Development Authority 
10created by this
Act.

11 "Casino" means one temporary land-based or water-based 
12facility and one permanent land-based or water-based facility 
13and airport gaming locations pursuant to Section 1-67 of this 
14Act at which lawful gambling is authorized
and licensed as 
15provided in the Illinois Gambling Act.

 
 
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1 "Casino Board" means the board appointed pursuant to this 
2Act to govern and control
the Authority.
3 "Casino management contract" means a legally binding

4agreement between the Authority and a casino operator licensee 
5to operate or manage a casino.
6 "Casino operator licensee" means any person or entity 
7selected by the Authority and approved and licensed by the 
8Gaming Board to manage and operate a casino within the City of 
9Chicago pursuant to a casino management contract.
10 "City" means the City of Chicago.

11 "Executive director" means the person appointed by the 
12Casino Board to oversee the
daily operations of the Authority.

13 "Gaming Board" means the Illinois Gaming Board created by 
14the Illinois Gambling Act.

15 "Mayor" means the Mayor of the City.



16 Section 1-12. Creation of the Authority. There is hereby 
17created a political subdivision, unit of local government with 
18only the powers authorized by law, body politic, and municipal 
19corporation, by the name and style of the Chicago Casino 
20Development Authority.

21 Section 1-13. Duties of the Authority. It shall be the duty 
22of the Authority, as an owners licensee under the Illinois 
23Gambling Act, to promote and maintain a casino in the City. The 
24Authority shall own, acquire, construct, lease, equip, and 
 
 
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1maintain grounds, buildings, and facilities for that purpose. 
2However, the Authority shall contract with a casino operator 
3licensee to manage and operate the casino and in no event shall 
4the Authority or City manage or operate the casino. The 
5Authority may contract pursuant to the procedures set forth in 
6Section 1-115 with other third parties in order to fulfill its 
7purpose. The Authority is responsible for the payment of any 
8fees required of a casino operator under subsection (a) of 
9Section 7.8 of the Illinois Gambling Act if the casino operator 
10licensee is late in paying any such fees. The Authority is 
11granted all rights and powers necessary to perform such duties. 
12Subject to the provisions of this Act, the Authority and casino 
13operator licensee are subject to the Illinois Gambling Act and 
14all of the rules of the Gaming Board, which shall be applied to 
15the Authority and the casino operator licensee in a manner 
16consistent with that of other owners licensees under the 
17Illinois Gambling Act.

18 Section 1-15. Casino Board. 
19 (a) The governing and administrative powers of the 
20Authority shall be vested
in a body known as the Chicago Casino 
21Development Board. The Casino Board shall
consist of 5 members 
22appointed by the Mayor. One of these
members shall be 
23designated
by the Mayor to serve as chairperson.
All of the 
24members
appointed by the Mayor shall be residents of the City.
25 Each Casino Board appointee shall be subject to a 
 
 
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1preliminary background investigation completed by the Gaming 
2Board within 30 days after the appointee's submission of his or 
3her application to the Gaming Board. If the Gaming Board 
4determines that there is a substantial likelihood that it will 
5not find the appointee to be suitable to serve on the Casino 
6Board (applying similar standards for suitability to the 
7appointee as the Gaming Board would apply to a member of a 
8board of directors of a corporate owners licensee under the 
9Illinois Gambling Act), then the Gaming Board shall provide a 
10written notice of such determination to the appointee and the 
11Corporation Counsel of the City. If no such notice is delivered 
12with respect to a particular appointee, then commencing on the 
1331st day following the date of the appointee's submission of 
14his or her application to the Gaming Board, the appointee shall 
15be deemed an acting member of the Casino Board and shall 
16participate as a Casino Board member.
17 Each appointee shall be subject to a full background 
18investigation and final approval by the Gaming Board prior to 
19the opening of the casino. The Gaming Board shall complete its 
20full background investigation of the Casino Board appointee 
21within 3 months after the date of the appointee's submission of 
22his or her application to the Gaming Board. If the Gaming Board 
23does not complete its background investigation within the 
243-month period, then the Gaming Board shall give a written 
25explanation to the appointee, as well as the Mayor, the 
26Governor, the President of the Senate, and the Speaker of the 
 
 
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1House of Representatives, as to why it has not reached a final 
2determination and set forth a reasonable time when such 
3determination shall be made.


4 (b) Casino Board members shall receive $300 for each day 
5the Authority meets and
shall be entitled to reimbursement of 
6reasonable expenses incurred in the
performance of their 
7official duties. A Casino Board member who serves in the office

8of secretary-treasurer may also receive compensation for 
9services provided
as that officer.


10 Section 1-20. Terms of appointments; resignation and 
11removal. 
12 (a) The Mayor shall appoint 2 members of the Casino Board 
13for an initial term expiring July 1 of the year following final 
14approval by the Gaming Board, 2 members for an initial term 
15expiring July 1 three years following final approval by the 
16Gaming Board, and one member for an initial term expiring July 
171 five years following final approval by the Gaming Board.

18 (b) All successors shall be appointed by the Mayor to hold 
19office for a term of 5 years from the first day of July of the 
20year in which they are appointed, except in the case of an 
21appointment to fill a vacancy. Each member, including the 
22chairperson, shall hold office until the expiration of his or 
23her term and until his or her successor is appointed and 
24qualified. Nothing shall preclude a member from serving 
25consecutive terms. Any member may resign from office, to take 
 
 
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1effect when a successor has been appointed and qualified. A 
2vacancy in office shall occur in the case of a member's death 
3or indictment, conviction, or plea of guilty to a felony. A 
4vacancy shall be filled for the unexpired term by the Mayor 
5subject to the approval of the Gaming Board as provided in this 
6Section.

7 (c) Members of the Casino Board shall serve at the pleasure 
8of the Mayor. The Mayor or the Gaming Board may remove any 
9member of the Casino Board upon a finding of incompetence, 
10neglect of duty, or misfeasance or malfeasance in office or for 
11a violation of this Act. The Gaming Board may remove any member 
12of the Casino Board for any violation of the Illinois Gambling 
13Act or the rules and regulations of the Gaming Board.

14 (d) No member of the Casino Board shall engage in any 
15political activity. For the purpose of this Section, "political 
16activity" means any activity in support of or in connection 
17with any campaign for federal, State, or local elective office 
18or any political organization, but does not include activities 
19(i) relating to the support or opposition of any executive, 
20legislative, or administrative action, as those terms are 
21defined in Section 2 of the Lobbyist Registration Act, (ii) 
22relating to collective bargaining, or (iii) that are otherwise 
23in furtherance of the person's official duties or governmental 
24and public service functions.


25 Section 1-25. Organization of Casino Board; meetings. 
 
 
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1After appointment by the Mayor, the Casino Board shall organize 
2for the transaction of business, provided that the Casino Board 
3shall not take any formal action until after the Gaming Board 
4has completed its preliminary background investigation of at 
5least a quorum of the Casino Board as provided in subsection 
6(a) of Section 1-15. The Casino Board shall prescribe the time 
7and place for meetings, the manner in which special meetings 
8may be called, and the notice that must be given to members. 
9All actions and meetings of the Casino Board shall be subject 
10to the provisions of the Open Meetings Act. Three members of 
11the Casino Board shall constitute a quorum. All substantive 
12action of the Casino Board shall be by resolution with an 
13affirmative vote of a majority of the members.


14 Section 1-30. Executive director; officers. 
15 (a) The Casino Board shall appoint
an executive director, 
16who shall be the chief executive officer of the
Authority.
17 The executive director shall be subject to a preliminary 
18background investigation to be completed by the Gaming Board 
19within 30 days after the executive director's submission of his 
20or her application to the Gaming Board. If the Gaming Board 
21determines that there is a substantial likelihood that it will 
22not find the executive director to be suitable to serve in that 
23position (applying similar standards for suitability as the 
24Gaming Board would apply to a member of a board of directors of 
25a corporate owners licensee under the Illinois Gambling Act), 
 
 
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1then the Gaming Board shall provide a written notice of such 
2determination to the appointee and the Corporation Counsel of 
3the City. If no such notice is delivered, then commencing on 
4the 31st day following the date of the executive director's 
5submission of his or her application to the Gaming Board, the 
6executive director shall commence all duties as the acting 
7executive director of the Authority.
8 The executive director shall be subject to a full 
9background investigation and final approval by the Gaming Board 
10prior to the opening of the casino. The Gaming Board shall 
11complete its full background investigation of the executive 
12director within 3 months after the date of the executive 
13director's submission of his or her application to the Gaming 
14Board. If the Gaming Board does not complete its background 
15investigation within the 3-month period, then the Gaming Board 
16shall give a written explanation to the appointee, as well as 
17the Mayor, the Governor, the President of the Senate, and the 
18Speaker of the House of Representatives, as to why it has not 
19reached a final determination and set forth a reasonable time 
20when such determination shall be made.

21 (b) The Casino Board shall fix the compensation of the 
22executive director.
Subject to the general control of the 
23Casino Board, the executive director shall be
responsible for 
24the management of the business, properties, and
employees of 
25the Authority. The executive director shall direct the

26enforcement of all resolutions, rules, and regulations of the 
 
 
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1Casino Board, and shall
perform such other duties as may be 
2prescribed from
time to time by the Casino Board. All employees 
3and independent contractors,
consultants, engineers, 
4architects, accountants, attorneys, financial experts,

5construction experts and personnel, superintendents, managers, 
6and other
personnel appointed or employed pursuant to this Act 
7shall
report to the executive director. In addition to any 
8other duties set forth in
this Act, the executive director 
9shall do or shall delegate to an employee or agent of the 
10Authority to do all of the following:


11  (1) Direct and supervise the administrative affairs 
12 and activities of the
Authority in accordance with its 
13 rules, regulations, and policies.


14  (2) Attend meetings of the Casino Board.


15  (3) Keep minutes of all proceedings of the Casino 
16 Board.


17  (4) Approve all accounts for salaries, per diem 
18 payments, and allowable
expenses of the Casino Board and 
19 its employees and consultants.


20  (5) Report and make recommendations to the Casino Board 
21 concerning the terms and
conditions of any casino 
22 management contract.


23  (6) Perform any other duty that the Casino Board 
24 requires for carrying out the
provisions of this Act.


25  (7) Devote his or her full time to the duties of the 
26 office and not hold
any other office or employment.

 
 
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1 (c) The Casino Board may select a secretary-treasurer and 
2other officers to hold office at the pleasure of the Casino 
3Board. The Casino Board
shall fix the duties of such officers.


4 Section 1-31. General rights and powers of the Authority. 
5 (a) In addition to the duties and powers set forth in this 
6Act, the Authority shall have the following rights and powers:
7  (1) Adopt and alter an official seal.
8  (2) Establish and change its fiscal year.
9  (3) Sue and be sued, plead and be impleaded, all in its 
10 own name, and agree to binding arbitration of any dispute 
11 to which it is a party. 
12  (4) Adopt, amend, and repeal bylaws, rules, and 
13 regulations consistent with the furtherance of the powers 
14 and duties provided for.
15  (5) Maintain its principal office within the City and 
16 such other offices as the Casino Board may designate.
17  (6) Select locations in the City for a temporary and a 
18 permanent casino.
19  (7) Subject to the bidding procedures of Section 1-115 
20 of this Act, retain or employ, either as regular employees 
21 or independent contractors, consultants, engineers, 
22 architects, accountants, attorneys, financial experts, 
23 construction experts and personnel, superintendents, 
24 managers and other professional personnel, and such other 
25 personnel as may be necessary in the judgment of the Casino 
 
 
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1 Board, and fix their compensation; however, employees of 
2 the Authority shall be hired pursuant to and in accordance 
3 with the rules and policies the Authority may adopt.
4  (8) Pursuant to Section 1-115 of this Act, own, 
5 acquire, construct, equip, lease, operate, manage, and 
6 maintain grounds, buildings, and facilities to carry out 
7 its corporate purposes and duties.
8  (9) Pursuant to Section 1-115, and subject to the 
9 oversight, review, and approval of the Gaming Board, enter 
10 into, revoke, and modify contracts in accordance with the 
11 rules of the Gaming Board as consistently applied to all 
12 owners licensees under the Illinois Gambling Act, provided 
13 that the Authority may enter into contracts for the design, 
14 construction, and outfitting of a temporary casino prior to 
15 the Gaming Board's final approval of the Authority's 
16 executive director and the members of the Casino Board and 
17 prior to the Gaming Board's issuance of the Authority's 
18 owners license. In no event, however, shall the Authority 
19 open a casino until after the Gaming Board has finally 
20 approved the Authority's executive director and the 
21 members of the Casino Board and the Gaming Board has issued 
22 the Authority's owners license and the casino operator's 
23 casino operator license.
24  (10) Enter into a casino management contract subject to 
25 the provisions of Section 1-45 of this Act.
26  (11) Develop, or cause to be developed by a third 
 
 
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1 party, a master plan for the design, planning, and 
2 development of a casino.
3  (12) Negotiate and enter into intergovernmental 
4 agreements with the State and its agencies, the City, and 
5 other units of local government, in furtherance of the 
6 powers and duties of the Casino Board. 
7  (13) Receive and disburse funds for its own corporate 
8 purposes or as otherwise specified in this Act.
9  (14) Borrow money from any source, public or private, 
10 for any corporate purpose, including, without limitation, 
11 working capital for its operations, reserve funds, or 
12 payment of interest, and to mortgage, pledge, or otherwise 
13 encumber the property or funds of the Authority and to 
14 contract with or engage the services of any person in 
15 connection with any financing, including financial 
16 institutions, issuers of letters of credit, or insurers and 
17 enter into reimbursement agreements with this person or 
18 entity which may be secured as if money were borrowed from 
19 the person or entity.
20  (15) Issue bonds as provided for under this Act.
21  (16) Receive and accept from any source, private or 
22 public, contributions, gifts, or grants of money or 
23 property to the Authority.
24  (17) Provide for the insurance of any property, 
25 operations, officers, members, agents, or employees of the 
26 Authority against any risk or hazard, to self-insure or 
 
 
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1 participate in joint self-insurance pools or entities to 
2 insure against such risk or hazard, and to provide for the 
3 indemnification of its officers, members, employees, 
4 contractors, or agents against any and all risks.
5  (18) Exercise all the corporate powers granted 
6 Illinois corporations under the Business Corporation Act 
7 of 1983, except to the extent that powers are inconsistent 
8 with those of a body politic and municipal corporation.
9  (19) Do all things necessary or convenient to carry out 
10 the powers granted by this Act.
11 (b) The Casino Board shall comply with all applicable legal 
12requirements imposed on other owners licensees to conduct all 
13background investigations required under the Illinois Gambling 
14Act and the rules of the Gaming Board. This requirement shall 
15also extend to senior legal, financial, and administrative 
16staff of the Authority.

17 Section 1-32. Ethical conduct.
18 (a) Casino Board members and employees of the Authority 
19must carry out their duties and responsibilities in such a 
20manner as to promote and preserve public trust and confidence 
21in the integrity and conduct of gaming.
22 (b) Except as may be required in the conduct of official 
23duties, Casino Board members and employees of the Authority 
24shall not engage in gambling on any riverboat, in any casino, 
25or in an electronic gaming facility licensed by the Illinois 
 
 
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1Gaming Board or engage in legalized gambling in any 
2establishment identified by Gaming Board action that, in the 
3judgment of the Gaming Board, could represent a potential for a 
4conflict of interest. 
5 (c) A Casino Board member or employee of the Authority 
6shall not use or attempt to use his or her official position to 
7secure or attempt to secure any privilege, advantage, favor, or 
8influence for himself or herself or others. 
9 (d) Casino Board members and employees of the Authority 
10shall not hold or pursue employment, office, position, 
11business, or occupation that may conflict with his or her 
12official duties. Employees may engage in other gainful 
13employment so long as that employment does not interfere or 
14conflict with their duties. Such employment must be disclosed 
15to the executive director and approved by the Casino Board. 
16 (e) Casino Board members, employees of the Authority, and 
17elected officials and employees of the City may not engage in 
18employment, communications, or any activity identified by the 
19Casino Board or Gaming Board that, in the judgment of either 
20entity, could represent the potential for or the appearance of 
21a conflict of interest. 
22 (f) Casino Board members, employees of the Authority, and 
23elected officials and employees of the City may not have a 
24financial interest, directly or indirectly, in his or her own 
25name or in the name of any other person, partnership, 
26association, trust, corporation, or other entity in any 
 
 
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1contract or subcontract for the performance of any work for the 
2Authority. This prohibition shall extend to the holding or 
3acquisition of an interest in any entity identified by the 
4Casino Board or the Gaming Board that, in the judgment of 
5either entity, could represent the potential for or the 
6appearance of a financial interest. The holding or acquisition 
7of an interest in such entities through an indirect means, such 
8as through a mutual fund, shall not be prohibited, except that 
9the Gaming Board may identify specific investments or funds 
10that, in its judgment, are so influenced by gaming holdings as 
11to represent the potential for or the appearance of a conflict 
12of interest. 
13 (g) Casino Board members, employees of the Authority, and 
14elected officials and employees of the City may not accept any 
15gift, gratuity, service, compensation, travel, lodging, or 
16thing of value, with the exception of unsolicited items of an 
17incidental nature, from any person, corporation, or entity 
18doing business with the Authority. 
19 (h) No Casino Board member, employee of the Authority, or 
20elected official or employee of the City may, during employment 
21or within a period of 2 years immediately after termination of 
22employment, knowingly accept employment or receive 
23compensation or fees for services from a person or entity, or 
24its parent or affiliate, that has engaged in business with the 
25Authority that resulted in contracts with an aggregate value of 
26at least $25,000 or if that Casino Board member or employee has 
 
 
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1made a decision that directly applied to the person or entity, 
2or its parent or affiliate. 
3 (i) A spouse, child, or parent of a Casino Board member, 
4employee of the Authority, or elected official or employee of 
5the City may not have a financial interest, directly or 
6indirectly, in his or her own name or in the name of any other 
7person, partnership, association, trust, corporation, or other 
8entity in any contract or subcontract for the performance of 
9any work for the Authority. This prohibition shall extend to 
10the holding or acquisition of an interest in any entity 
11identified by the Casino Board or Gaming Board that, in the 
12judgment of either entity, could represent the potential for or 
13the appearance of a conflict of interest. The holding or 
14acquisition of an interest in such entities through an indirect 
15means, such as through a mutual fund, shall not be prohibited, 
16expect that the Gaming Board may identify specific investments 
17or funds that, in its judgment, are so influenced by gaming 
18holdings as to represent the potential for or the appearance of 
19a conflict of interest. 
20 (j) A spouse, child, or parent of a Casino Board member, 
21employee of the Authority, or elected official or employee of 
22the City may not accept any gift, gratuity, service, 
23compensation, travel, lodging, or thing of value, with the 
24exception of unsolicited items of an incidental nature, from 
25any person, corporation, or entity doing business with the 
26Authority. 
 
 
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1 (k) A spouse, child, or parent of a Casino Board member, 
2employee of the Authority, or elected official or employee of 
3the City may not, while the person is a Board member or 
4employee of the spouse or within a period of 2 years 
5immediately after termination of employment, knowingly accept 
6employment or receive compensation or fees for services from a 
7person or entity, or its parent or affiliate, that has engaged 
8in business with the Authority that resulted in contracts with 
9an aggregate value of at least $25,000 or if that Casino Board 
10member, employee, or elected official or employee of the City 
11has made a decision that directly applied to the person or 
12entity, or its parent or affiliate. 
13 (l) No Casino Board member, employee of the Authority, or 
14elected official or employee of the City may attempt, in any 
15way, to influence any person or corporation doing business with 
16the Authority or any officer, agent, or employee thereof to 
17hire or contract with any person or corporation for any 
18compensated work. 
19 (m) No Casino Board member, employee of the Authority, or 
20elected official or employee of the City shall use or attempt 
21to use his or her official position to secure, or attempt to 
22secure, any privilege, advantage, favor, or influence for 
23himself or herself or others. No Casino Board member, employee 
24of the Authority, or elected official or employee of the City 
25shall, within one year immediately preceding appointment by the 
26Mayor or employment, have been employed or received 
 
 
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1compensation or fees for services from a person or entity, or 
2its parent or affiliate, that has engaged in business with the 
3Casino Board, a licensee under this Act, or a licensee under 
4the Illinois Gambling Act.
5 (n) Any communication between an elected official of the 
6City and any applicant for or party to a casino management 
7contract with the Authority, or an officer, director, or 
8employee thereof, concerning any matter relating in any way to 
9gaming or the Authority shall be disclosed to the Casino Board 
10and the Gaming Board. Such disclosure shall be in writing by 
11the official within 30 days after the communication and shall 
12be filed with the Casino Board. Disclosure must consist of the 
13date of the communication, the identity and job title of the 
14person with whom the communication was made, a brief summary of 
15the communication, the action requested or recommended, all 
16responses made, the identity and job title of the person making 
17the response, and any other pertinent information.
18 Public disclosure of the written summary provided to the 
19Casino Board and the Gaming Board shall be subject to the 
20exemptions provided under Section 7 of the Freedom of 
21Information Act. 
22 This subsection (n) shall not apply to communications 
23regarding traffic, law enforcement, security, environmental 
24issues, City services, transportation, or other routine 
25matters concerning the ordinary operations of the casino. 
26 (o) For purposes of this Section:
 
 
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1 "Ordinary operations" means operations relating to the 
2casino facility other than the conduct of gambling activities.
3 "Routine matters" includes the application for, issuance, 
4renewal, and other processes associated with City permits and 
5licenses.
6 "Employee of the City" means only those employees of the 
7City who provide services to the Authority or otherwise 
8influence the decisions of the Authority or the Casino Board.
9 (p) Any Board member or employee of the Authority who 
10violates any provision of this Section is guilty of a Class 4 
11felony.



12 Section 1-45. Casino management contracts. 
13 (a) In accordance with all applicable procurement laws and 
14rules, the Casino Board shall develop and administer a 
15competitive sealed bidding process
for the
selection of a 
16potential casino operator licensee to develop or operate a 
17casino within the City.
The Casino Board shall issue one or 
18more requests for proposals. The Casino Board may
establish 
19minimum financial and investment requirements to determine the

20eligibility of persons to respond to the Casino Board's 
21requests for proposal, and may
establish and consider such 
22other criteria as it deems appropriate. The Casino Board
may 
23impose a reasonable fee upon persons who respond to requests 
24for proposal, in order to
reimburse the Casino Board for its 
25costs in preparing and issuing the requests and
reviewing the 
 
 
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1proposals. At least 15 days prior to the commencement of the 
2competitive bidding process, the Gaming Board shall be given an 
3opportunity to review the competitive bidding process 
4established by the Casino Board. During the competitive bidding 
5process, the Casino Board shall keep the Gaming Board apprised 
6of the process and the responses received in connection with 
7the Casino Board's request for proposals.

8 (b) Within 5 business days after the time limit for 
9submitting bids and proposals has passed, the Casino Board 
10shall make all bids and proposals public, provided, however, 
11the Casino Board shall not be required to disclose any 
12information which would be exempt from disclosure under Section 
137 of the Freedom of Information Act. Thereafter, the Casino 
14Board shall evaluate the responses to its requests for proposal 
15and
the ability of all persons or entities responding to its 
16requests for proposal
to meet the requirements of this Act and 
17any relevant provisions of the Illinois Gambling Act and to 
18undertake and perform the
obligations set forth in its requests 
19for proposal.

20 (c) After reviewing proposals, the Casino Board shall enter 
21into a casino management contract authorizing the operation of 
22a casino. The casino operator shall be subject to a background 
23investigation and approval by the Gaming Board. The Gaming 
24Board shall complete its background investigation and approval 
25of the casino operator within 6 months after the date that the 
26proposed casino operator submits its application to the Gaming 
 
 
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1Board. If the Gaming Board does not complete its background 
2investigation and approval within the 6-month period, then the 
3Gaming Board shall give a written explanation to the proposed 
4casino operator and the chief legal officer of the Authority as 
5to why it has not reached a final determination. The Gaming 
6Board shall then complete its investigation within 3 months 
7after giving such written explanation. Validity of the casino 
8management contract is contingent upon the issuance of a casino 
9operator license to the successful bidder. If the Gaming Board 
10grants a casino operator license, the Casino Board shall 
11transmit a copy of the executed casino management contract to 
12the Gaming Board.
13 (d) After (1) the Authority has been issued a casino 
14license, (2) the Gaming Board has issued a casino operator 
15license, and (3) the Gaming Board has approved the members of 
16the Casino Board, the Authority may conduct gaming operations 
17at a temporary facility for no longer than 24 months after 
18gaming operations begin. The Gaming Board may, after holding a 
19public hearing, grant an extension so long as a permanent 
20facility is not operational and the Authority is working in 
21good faith to complete the permanent facility. The Gaming Board 
22may grant additional extensions following further public 
23hearings. Each extension may be for a period of no longer than 
246 months. 
25 (e) Fifty percent of any initial consideration received by 
26the Authority that was paid as an inducement pursuant to a bid 
 
 
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1for a casino management contract or an executed casino 
2management contract must be transmitted to the State and 
3deposited into the Gaming Facilities Fee Revenue Fund. The 
4initial consideration shall not include (1) any amounts paid to 
5the Authority as reimbursement for its costs in preparing or 
6issuing the requests for proposals and reviewing the proposals 
7or (2) any amounts loaned to the Authority or paid by an entity 
8on behalf of the Authority for the design, construction, 
9outfitting, or equipping of the casino, pre-opening expenses, 
10bank roll or similar expenses required to open and operate the 
11casino, or any license or per position fees imposed pursuant to 
12the Illinois Gambling Act or any other financial obligation of 
13the Authority.


14 Section 1-47. Freedom of Information Act. The Authority 
15shall be a public body as defined in the Freedom of Information 
16Act and shall be subject to the provisions of the Freedom of 
17Information Act.

18 Section 1-50. Transfer of funds.  The revenues received by 
19the Authority (other than amounts required to be paid pursuant 
20to the Illinois Gambling Act and amounts required to pay the

21operating expenses of the Authority, to pay amounts due the 
22casino operator licensee pursuant to a casino management 
23contract, to repay any borrowing of the Authority
made pursuant 
24to Section 1-31, to pay debt service on any bonds issued under

 
 
09800SB1739sam001- 23 -LRB098 10559 AMC 42403 a


1Section
1-75, and to pay any expenses in connection with the 
2issuance of such bonds
pursuant to Section 1-75 or derivative 
3products pursuant to Section 1-85) shall
be transferred
to the

4City by the Authority. Moneys transferred to the City pursuant 
5to this Section shall be expended or obligated by the City for 
6the construction and maintenance of infrastructure and for 
7related purposes within the City. Such infrastructure may 
8include, but is not limited to, roads, bridges, transit 
9infrastructure, water and sewer infrastructure, schools, 
10parks, and municipal facilities.


11 Section 1-60. Auditor General. 
12 (a) Prior to the issuance of bonds under this Act, the 
13Authority shall submit to the Auditor General a certification 
14that:
15  (1) it is legally authorized to issue bonds;
16  (2) scheduled annual payments of principal and 
17 interest on the bonds to be issued meet the requirements of 
18 Section 1-75 of this Act;
19  (3) no bond shall mature later than 30 years; and
20  (4) after payment of costs of issuance and necessary 
21 deposits to funds and accounts established with respect to 
22 debt service on the bonds, the net bond proceeds (exclusive 
23 of any proceeds to be used to refund outstanding bonds) 
24 will be used only for the purposes set forth in this Act.
25 The Authority also shall submit to the Auditor General its 
 
 
09800SB1739sam001- 24 -LRB098 10559 AMC 42403 a


1projections on revenues to be generated and pledged to 
2repayment of the bonds as scheduled and such other information 
3as the Auditor General may reasonably request.
4 The Auditor General shall examine the certifications and 
5information submitted and submit a report to the Authority and 
6the Gaming Board indicating whether the required 
7certifications, projections, and other information have been 
8submitted by the Authority and whether the assumptions 
9underlying the projections are not unreasonable in the 
10aggregate. The Auditor General shall submit the report no later 
11than 60 days after receiving the information required to be 
12submitted by the Authority.
13 The Auditor General shall submit a bill to the Authority 
14for costs associated with the examinations and report required 
15under this Section. The Authority shall reimburse in a timely 
16manner.
17 (b) The Authority shall enter into an intergovernmental 
18agreement with the Auditor General authorizing the Auditor 
19General to, every 2 years, (i) review the financial audit of 
20the Authority performed by the Authority's certified public 
21accountants, (ii) perform a management audit of the Authority, 
22and (iii) perform a management audit of the casino operator 
23licensee. The Auditor General shall provide the Authority and 
24the General Assembly with the audits and shall post on his or 
25her Internet website such portions of the audit or other 
26financial information as generally would be made publicly 
 
 
09800SB1739sam001- 25 -LRB098 10559 AMC 42403 a


1available for other owners licensees under the Illinois 
2Gambling Act. The Auditor General shall submit a bill to the 
3Authority for costs associated with the review and the audit 
4required under this Section, which costs shall not exceed 
5$100,000, and the Authority shall reimburse the Auditor General 
6for such costs in a timely manner.


7 Section 1-62. Advisory committee. An Advisory Committee is 
8established to monitor, review, and report on (1) the 
9Authority's utilization of minority-owned business enterprises 
10and female-owned business enterprises, (2) employment of 
11females, and (3) employment of minorities with regard to the 
12development and construction of the casino as authorized under 
13Section 7 of the Illinois Gambling Act. The Authority shall 
14work with the Advisory Committee in accumulating necessary 
15information for the Committee to submit reports, as necessary, 
16to the General Assembly and to the City.

17 The Committee shall consist of 9 members as provided in 
18this Section. Five members shall be selected by the Governor 
19and 4 members shall be selected by the Mayor. The Governor and 
20Mayor shall each appoint at least one current member of the 
21General Assembly. The Advisory Committee shall meet 
22periodically and shall report the information to the Mayor of 
23the City and to the General Assembly by December 31st of every 
24year.
25 The Advisory Committee shall be dissolved on the date that 
 
 
09800SB1739sam001- 26 -LRB098 10559 AMC 42403 a


1casino gambling operations are first conducted at a permanent 
2facility under the license authorized under Section 7 of the 
3Illinois Gambling Act. For the purposes of this Section, the 
4terms "female" and "minority person" have the meanings provided 
5in Section 2 of the Business Enterprise for Minorities, 
6Females, and Persons with Disabilities Act.

7 Section 1-65. Acquisition of property; eminent domain 
8proceedings. For the lawful purposes of this Act, the City may 
9acquire by eminent
domain or by condemnation proceedings in the 
10manner provided by the Eminent Domain Act, real or personal 
11property or interests in real
or personal property located in 
12the City, and the City may convey to the Authority
property so 
13acquired. The acquisition of property under this Section is

14declared to be for a public use.



15 Section 1-67. Limitations on gaming at Chicago airports.

16The Authority may conduct gaming operations in an airport under 
17the administration or control of the Chicago Department of 
18Aviation. Gaming operations may be conducted pursuant to this 
19Section so long as (i) gaming operations are conducted in a 
20secured area that is beyond the Transportation Security 
21Administration security checkpoints and only available to 
22airline passengers at least 21 years of age who are members of 
23a private club, and not to the general public, (ii) gaming 
24operations are limited to slot machines, as defined in Section 
 
 
09800SB1739sam001- 27 -LRB098 10559 AMC 42403 a


14 of the Illinois Gambling Act, and (iii) the combined number 
2of gaming positions operating in the City at the airports and 
3at the temporary and permanent casino facility does not exceed 
4the maximum number of gaming positions authorized pursuant to 
5subsection (h) of Section 7 of the Illinois Gambling Act. 
6Gaming operations at an airport are subject to all applicable 
7laws and rules that apply to any other gaming facility under 
8this Act or the Illinois Gambling Act.

9 Section 1-70. Local regulation. The casino facilities and 
10operations therein
shall be subject to all ordinances and 
11regulations of the City. The
construction, development, and 
12operation of the casino shall comply with all
ordinances, 
13regulations, rules, and controls of the City, including, but 
14not
limited to, those relating to zoning and planned 
15development, building, fire
prevention, and land use. However, 
16the regulation of gaming operations is
subject to the exclusive 
17jurisdiction of the Gaming Board. The Gaming Board shall be 
18responsible for the investigation for and issuance of all 
19licenses required by this Act and the Illinois Gambling Act. 
20For the purposes of this Section, "gaming operations" means 
21those activities directly related to the conduct of gambling 
22activity in the casino and "operations" means those activities 
23not directly related to the conduct of gambling, and includes 
24activities customarily carried out by similarly-sized 
25facilities not involved in gambling activity.


 
 
09800SB1739sam001- 28 -LRB098 10559 AMC 42403 a


1 Section 1-75. Borrowing. 
2 (a) The Authority may borrow money and
issue bonds as 
3provided in this Section. Bonds of the Authority may be issued

4to provide funds for land acquisition, site assembly and 
5preparation, and the design and construction of the casino, as 
6defined in the Illinois Gambling Act, all ancillary and related 
7facilities comprising the casino complex, and all on-site and 
8off-site infrastructure improvements required in connection 
9with the development of the casino; to refund (at the time or 
10in advance of any maturity or
redemption) or redeem any bonds 
11of the Authority; to provide or increase a
debt
service reserve 
12fund or other reserves with respect to any or all of its bonds;

13or to pay the legal, financial, administrative, bond
insurance, 
14credit enhancement, and other legal expenses of the 
15authorization,
issuance, or delivery of bonds. In this Act, the 
16term "bonds" also includes
notes of any kind, interim 
17certificates, refunding bonds, or any other evidence
of 
18obligation for borrowed money issued under this Section. Bonds 
19may be
issued in one or more series and may be payable and 
20secured either on a parity
with or separately from other bonds. 

21 (b) The bonds of the Authority shall be payable from one or 
22more of
the following sources: (i) the property or revenues of 
23the Authority; (ii)
revenues derived from the casino; (iii) 
24revenues derived from any casino
operator licensee; (iv) fees, 
25bid proceeds, charges, lease payments, payments required 
 
 
09800SB1739sam001- 29 -LRB098 10559 AMC 42403 a


1pursuant to any
casino management contract or other revenues 
2payable to the
Authority, or any
receipts of the Authority; (v) 
3payments by financial institutions, insurance
companies, or 
4others pursuant to letters or lines of credit, policies of

5insurance, or purchase agreements; (vi) investment earnings 
6from funds or
accounts maintained pursuant to a bond resolution 
7or trust indenture; (vii)
proceeds of refunding bonds; (viii) 
8any other revenues derived from or payments by the City; and 
9(ix) any payments by any casino operator licensee or others 
10pursuant to any guaranty agreement.

11 (c) Bonds shall be authorized by a resolution of the 
12Authority and may be
secured by a trust indenture by and 
13between the Authority and a corporate
trustee or trustees, 
14which may be any trust company or bank having the powers
of a 
15trust company within or without the State. Bonds shall meet the 
16following requirements:


17  (1) Bonds may bear interest payable at any time or 
18 times and at any rate or rates, notwithstanding any other 
19 provision of law to the contrary, and may be subject to 
20 such other terms and conditions as may be provided by the 
21 resolution or indenture authorizing the issuance of such 
22 bonds.


23  (2) Bonds issued pursuant to this Section may be 
24 payable on such dates and times as may be provided for by 
25 the resolution or indenture authorizing the issuance of 
26 such bonds; provided, however, that such bonds shall mature 
 
 
09800SB1739sam001- 30 -LRB098 10559 AMC 42403 a


1 no later than 30 years from the date of issuance.
2  (3) Bonds issued pursuant to this Section may be sold 
3 pursuant to notice of sale and public bid or by negotiated 
4 sale.


5  (4) Bonds shall be payable at a time or times, in the 
6 denominations and form,
including book entry form, either 
7 coupon, registered, or both, and carry the
registration and 
8 privileges as to exchange, transfer or conversion, and

9 replacement of mutilated, lost, or destroyed bonds as the 
10 resolution or trust
indenture may provide.


11  (5) Bonds shall be payable in lawful money of the 
12 United States at a designated
place.


13  (6) Bonds shall be subject to the terms of purchase, 
14 payment, redemption, refunding,
or refinancing that the 
15 resolution or trust indenture provides.


16  (7) Bonds shall be executed by the manual or facsimile 
17 signatures of the officers
of the Authority designated by 
18 the Board, which signatures shall be valid at
delivery even

19 for one who has ceased to hold office.


20  (8) Bonds shall be sold at public or private sale in 
21 the manner and upon the terms
determined by the Authority.


22  (9) Bonds shall be issued in accordance with the 
23 provisions of the Local
Government Debt Reform Act.

24 (d) The Authority shall adopt a procurement program with 
25respect to contracts relating to underwriters, bond counsel, 
26financial advisors, and accountants. The program shall include 
 
 
09800SB1739sam001- 31 -LRB098 10559 AMC 42403 a


1goals for the payment of not less than 30% of the total dollar 
2value of the fees from these contracts to minority-owned 
3businesses and female-owned businesses as defined in the 
4Business Enterprise for Minorities, Females, and Persons with 
5Disabilities Act. The Authority shall conduct outreach to 
6minority-owned businesses and female-owned businesses. 
7Outreach shall include, but is not limited to, advertisements 
8in periodicals and newspapers, mailings, and other appropriate 
9media. The Authority shall submit to the General Assembly a 
10comprehensive report that shall include, at a minimum, the 
11details of the procurement plan, outreach efforts, and the 
12results of the efforts to achieve goals for the payment of 
13fees.
14 (e) Subject to the Illinois Gambling Act and rules of the 
15Gaming Board regarding pledging
of interests in holders of 
16owners licenses, any resolution or trust indenture may contain 
17provisions that may be a part of
the contract with the holders 
18of the bonds as to the following:


19  (1) Pledging, assigning, or directing the use, 
20 investment, or disposition
of revenues of the Authority or 
21 proceeds or benefits of any contract, including
without 
22 limitation any rights in any casino management
contract.


23  (2) The setting aside of loan funding deposits, debt 
24 service reserves, replacement or operating reserves, cost 
25 of
issuance accounts and sinking funds, and the regulation, 
26 investment, and
disposition thereof.


 
 
09800SB1739sam001- 32 -LRB098 10559 AMC 42403 a


1  (3) Limitations on the purposes to which or the 
2 investments in which the
proceeds of sale of any issue of 
3 bonds or the Authority's revenues and
receipts may be 
4 applied or made.


5  (4) Limitations on the issue of additional bonds, the 
6 terms upon which
additional bonds may be issued and 
7 secured, the terms upon which additional
bonds may rank on 
8 a parity with, or be subordinate or superior to, other 
9 bonds.


10  (5) The refunding, advance refunding, or refinancing 
11 of outstanding bonds.


12  (6) The procedure, if any, by which the terms of any 
13 contract with
bondholders may be altered or amended and the 
14 amount of bonds and holders of
which must consent thereto 
15 and the manner in which consent shall be given.


16  (7) Defining the acts or omissions that shall 
17 constitute a default in the
duties of the Authority to 
18 holders of bonds and providing the rights or
remedies of 
19 such holders in the event of a default, which may include

20 provisions
restricting individual rights of action by 
21 bondholders.


22  (8) Providing for guarantees, pledges of property, 
23 letters of credit, or
other security,
or insurance for the 
24 benefit of bondholders.

25 (f) No member of the Casino Board, nor any person executing 
26the bonds, shall be
liable personally on the bonds or subject 
 
 
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1to any personal liability by reason
of the issuance of the 
2bonds.

3 (g) The Authority may issue and secure bonds in accordance 
4with the
provisions of the Local Government Credit Enhancement 
5Act.

6 (h) A pledge by the Authority of revenues and receipts as 
7security for an
issue of bonds or for the performance of its 
8obligations under any casino
management contract shall
be valid 
9and binding from the time when the pledge is made. The revenues 
10and
receipts pledged shall immediately be subject to the lien 
11of the pledge without
any physical delivery or further act,
and 
12the lien of any pledge shall be valid and binding against any 
13person having
any claim of any kind in tort, contract, or 
14otherwise against the Authority,
irrespective of whether the 
15person has notice. No resolution, trust indenture,
management 
16agreement or financing statement, continuation statement, or 
17other
instrument adopted or entered into by the Authority need 
18be filed or recorded
in any public record other than the 
19records of the Authority in order to
perfect the lien against 
20third persons, regardless of any contrary provision of
law.

21 (i) Bonds that are being paid or retired by issuance, sale, 
22or delivery of
bonds, and bonds for which sufficient funds have 
23been deposited with the paying
agent or trustee to provide for 
24payment of principal and interest thereon, and
any redemption 
25premium, as provided in the authorizing resolution, shall not 
26be
considered outstanding for the purposes of this subsection.

 
 
09800SB1739sam001- 34 -LRB098 10559 AMC 42403 a


1 (j) The bonds of the Authority shall not be indebtedness of 
2the
State.
The bonds of the Authority are not general 
3obligations of the State and are not secured by a pledge of the 
4full faith and
credit of the State and the holders of bonds of 
5the Authority may
not require, except as provided in this Act, 
6the application of State revenues or
funds to the payment of 
7bonds of the Authority.

8 (k) The State of
Illinois pledges and agrees with the 
9owners of the bonds that it will not limit
or alter the rights 
10and powers vested in the Authority by this Act so as to
impair 
11the terms of any contract made by the Authority with the owners 
12or in
any way impair the rights and remedies of the owners 
13until the bonds, together
with interest on them, and all costs 
14and expenses in connection with any action
or proceedings by or 
15on behalf of the owners, are fully met and discharged.
The 
16Authority is authorized to include this pledge and
agreement in 
17any contract with the owners of bonds issued under this 
18Section.

19 (l) No person holding an elective office in the City, in 
20Cook County, or in this State, holding a seat in the General 
21Assembly, or serving as a board member, trustee, officer, or 
22employee of the Authority, including the spouse of that person, 
23may receive a legal, banking, consulting, or other fee related 
24to the issuance of bonds. This prohibition shall also apply to 
25a company or firm that employs a person holding an elective 
26office in the City, in Cook County, or in this State, holding a 
 
 
09800SB1739sam001- 35 -LRB098 10559 AMC 42403 a


1seat in the General Assembly, or serving as a board member, 
2trustee, officer, or employee of the Authority, including the 
3spouse of that person, if the person or his or her spouse has 
4greater than 7.5% ownership of the company or firm.


5 Section 1-85. Derivative products.  With respect to all or 
6part of any issue
of its bonds, the Authority may enter into 
7agreements or contracts with any
necessary or appropriate 
8person, which will have the benefit of providing to
the

9Authority an interest rate basis, cash flow basis, or other 
10basis different
from that provided in the bonds for the payment 
11of interest. Such agreements
or contracts may include, without 
12limitation, agreements or contracts commonly
known as 
13"interest rate swap agreements", "forward payment conversion

14agreements", "futures", "options", "puts", or "calls" and 
15agreements or
contracts providing for payments based on levels 
16of or changes in interest
rates, agreements or contracts to 
17exchange cash flows or a series of payments,
or to hedge 
18payment, rate spread, or similar exposure.


19 Section 1-90. Legality for investment. The State of 
20Illinois, all
governmental entities, all public officers, 
21banks, bankers, trust companies,
savings banks and 
22institutions, building and loan associations, savings and
loan 
23associations, investment companies, and other persons carrying 
24on a
banking
business, insurance companies, insurance 
 
 
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1associations, and other persons
carrying on an insurance 
2business, and all executors, administrators,
guardians, 
3trustees, and other fiduciaries may legally invest any sinking

4funds,
moneys, or other funds belonging to them or within their 
5control in
any bonds issued under this Act. However, nothing in 
6this Section shall be
construed as relieving any person, firm, 
7or corporation from any duty of
exercising reasonable care in 
8selecting securities for purchase or investment.


9 Section 1-105. Budgets and reporting. 

10 (a) The Casino Board shall annually adopt a budget for each

11fiscal year. The budget may be modified from time to time in 
12the same manner
and upon the same vote as it may be adopted. 
13The budget shall include the
Authority's available funds and 
14estimated revenues and shall provide for
payment of its 
15obligations and estimated expenditures for the fiscal year,

16including, without limitation, expenditures for 
17administration, operation,
maintenance and repairs, debt 
18service, and deposits into reserve and other
funds
and capital 
19projects.

20 (b) The Casino Board shall annually cause the finances of 
21the Authority to be
audited by a firm of certified public 
22accountants selected by the Casino Board in accordance with the 
23rules of the Gaming Board and post on the Authority's Internet 
24website such financial information as is required to be posted 
25by all other owners licensees under the Illinois Gambling Act.

 
 
09800SB1739sam001- 37 -LRB098 10559 AMC 42403 a


1 (c) The Casino Board shall, for each fiscal year, prepare 
2an annual report
setting forth information concerning its 
3activities in the fiscal year and the
status of the development 
4of the casino. The annual report shall include financial 
5information of the Authority consistent with that which is 
6required for all other owners licensees under the Illinois 
7Gambling Act, the budget
for the succeeding fiscal year, and 
8the current capital plan as of the date of
the report. Copies 
9of the annual report shall be made available to persons who

10request them and shall be submitted not later than 120 days 
11after the end of
the Authority's fiscal year or, if the audit 
12of the Authority's financial statements is not completed within 
13120 days after the end of the Authority's fiscal year, as soon 
14as practical after completion of the audit, to the Governor, 
15the Mayor, the General Assembly, and the Commission on 
16Government Forecasting and Accountability.



17 Section 1-110. Deposit and withdrawal of funds.
18 (a) All funds deposited by the Authority in any bank or 
19savings and loan
association shall be placed in the name of the 
20Authority and shall be withdrawn
or paid out only by check or 
21draft upon the bank or savings and loan
association, signed by 
222 officers or employees designated by the Casino Board.

23Notwithstanding any other provision of this Section, the Casino 
24Board may designate
any of its members or any officer or 
25employee of the Authority to authorize the
wire transfer of 
 
 
09800SB1739sam001- 38 -LRB098 10559 AMC 42403 a


1funds deposited by the secretary-treasurer of funds in a bank

2or savings and loan association for the payment of payroll and 
3employee
benefits-related expenses.

4 No bank or savings and loan association shall receive 
5public funds as
permitted by this Section unless it has 
6complied with the requirements
established pursuant to Section 
76 of the Public
Funds Investment Act.

8 (b) If any officer or employee whose signature appears upon 
9any check
or draft issued pursuant to this Act ceases (after 
10attaching his signature) to
hold his or her office before the 
11delivery of such a check or draft to the
payee, his or her 
12signature shall nevertheless be valid and sufficient for all

13purposes with the same effect as if he or she had remained in 
14office until
delivery thereof.



15 Section 1-112. Contracts with the Authority or casino 
16operator licensee; disclosure requirements. 
17 (a) A bidder, respondent, offeror, or contractor for 
18contracts with the Authority or casino operator licensee shall 
19disclose the identity of all officers and directors and every 
20owner, beneficiary, or person with beneficial interest of more 
21than 1% or shareholder entitled to receive more than 1% of the 
22total distributable income of any corporation having any 
23interest in the contract or in the bidder, respondent, offeror, 
24or contractor. The disclosure shall be in writing and attested 
25to by an owner, trustee, corporate official, or agent. If stock 
 
 
09800SB1739sam001- 39 -LRB098 10559 AMC 42403 a


1in a corporation is publicly traded and there is no readily 
2known individual having greater than a 1% interest, then a 
3statement to that effect attested to by an officer or agent of 
4the corporation shall fulfill the disclosure statement 
5requirement of this Section. A bidder, respondent, offeror, or 
6contractor shall notify the Authority of any changes in 
7officers, directors, ownership, or individuals having a 
8beneficial interest of more than 1%. Notwithstanding the 
9provisions of this subsection (a), the Gaming Board may adopt 
10rules in connection with contractors for contracts with the 
11Authority or the casino operator.
12 (b) A bidder, respondent, offeror, or contractor for 
13contracts with an annual value of $25,000 or more or for a 
14period to exceed one year shall disclose all political 
15contributions of the bidder, respondent, offeror, or 
16contractor and any affiliated person or entity. Disclosure 
17shall include at least the names and addresses of the 
18contributors and the dollar amounts of any contributions to any 
19political committee made within the previous 2 years. The 
20disclosure must be submitted to the Gaming Board with a copy of 
21the contract. All such disclosures shall be posted on the 
22websites of the Authority and the Gaming Board.
23 (c) As used in this Section:
24 "Contribution" means contribution as defined in Section 
259-1.4 of the Election Code.
26 "Affiliated person" means (i) any person with any ownership 
 
 
09800SB1739sam001- 40 -LRB098 10559 AMC 42403 a


1interest or distributive share of the bidding, responding, or 
2contracting entity in excess of 1%, (ii) executive employees of 
3the bidding, responding, or contracting entity, and (iii) the 
4spouse, minor children, and parents of any such persons.
5 "Affiliated entity" means (i) any parent or subsidiary of 
6the bidding or contracting entity, (ii) any member of the same 
7unitary business group, or (iii) any political committee for 
8which the bidding, responding, or contracting entity is the 
9sponsoring entity.
10 (d) The Gaming Board may direct the Authority or a casino 
11operator licensee to void a contract if a violation of this 
12Section occurs. The Authority may direct a casino operator 
13licensee to void a contract if a violation of this Section 
14occurs.
15 (e) All contracts pertaining to the actual operation of the 
16casino and related gaming activities shall be entered into by 
17the casino operator licensee and not the Authority and shall be 
18subject to the regulation, oversight, and approval of the 
19Gaming Board, applying the same regulation, oversight, and 
20approval requirements as would be applied to any other owners 
21licensee under the Illinois Gambling Act.

22 Section 1-115. Purchasing. 
23 (a) The Casino Board shall designate an officer of the 
24Authority to serve as the Chief Procurement Officer for the 
25Authority. The Chief Procurement Officer shall have all powers 
 
 
09800SB1739sam001- 41 -LRB098 10559 AMC 42403 a


1and duties set forth in Section 15 of Division 10 of Article 8 
2of the Illinois Municipal Code. Except as otherwise provided in 
3this Section, the Chief Procurement Officer of the Authority 
4shall conduct procurements on behalf of the Authority subject 
5to Title 2, Chapter 92 of the Municipal Code of Chicago, which 
6by its terms incorporates Division 10 of Article 8 of the 
7Illinois Municipal Code.
8 (b) All contracts for amounts greater than $25,000 must be 
9approved by the Casino Board and executed by the chairperson of 
10the Casino Board and executive director of the Authority. 
11Contracts for amounts of $25,000 or less may be approved and 
12executed by the Chief Procurement Officer for the Authority and 
13executive director of the Authority, with approval by the chief 
14legal counsel for the Authority as to form and legality.
15 (c) All construction contracts and contracts for supplies, 
16materials,
equipment, and services for amounts greater than 
17$25,000 shall be let by a competitive selection process to
the 
18lowest responsible proposer, after advertising for proposals, 
19except for the
following:


20  (1) when repair parts, accessories, equipment, or 
21 services are required
for
equipment or services previously 
22 furnished or contracted for;


23  (2) when services such as water, light, heat, power, 
24 telephone (other than
long-distance service), or telegraph 
25 are required;


26  (3) casino management contracts, which shall be 
 
 
09800SB1739sam001- 42 -LRB098 10559 AMC 42403 a


1 awarded as
set forth in Section 1-45 of this Act;

2  (4) contracts where there is only one economically 
3 feasible source;
4  (5) when a purchase is needed on an immediate, 
5 emergency basis because there exists a threat to public 
6 health or public safety, or when immediate expenditure is 
7 necessary for repairs to Authority property in order to 
8 protect against further loss of or damage to Authority 
9 property, to prevent or minimize serious disruption in 
10 Authority services or to ensure the integrity of Authority 
11 records;
12  (6) contracts for professional services other than for 
13 management of the casino, except such contracts described 
14 in subsection (d) of this Section; and
15  (7) contracts for the use, purchase, delivery, 
16 movement, or installation of (i) data processing 
17 equipment, software, and services and (ii) 
18 telecommunications equipment, software, and services.

19 (d) Contracts for professional services for a term of more 
20than one year or contracts that may require payment in excess 
21of $25,000 in one year shall be let by a competitive bidding 
22process to the most highly qualified firm that agrees to 
23compensation and other terms of engagement that are both 
24reasonable and acceptable to the Casino Board.
25 (e) All contracts involving less than $25,000 shall be let 
26by competitive
selection process whenever possible, and in any 
 
 
09800SB1739sam001- 43 -LRB098 10559 AMC 42403 a


1event in a manner calculated to ensure
the best interests of 
2the public.

3 (f) In determining the responsibility of any proposer, the 
4Authority may take
into account the proposer's (or an 
5individual having a beneficial interest,
directly or 
6indirectly, of more than 1% in such proposing entity) past 
7record of
dealings with the Authority, the proposer's 
8experience, adequacy of equipment,
and ability to complete 
9performance within the time set, and other factors
besides 
10financial responsibility. No such contract shall be awarded to 
11any proposer other than the lowest proposer (in case of 
12purchase or
expenditure) unless authorized or approved by a 
13vote of at least 3 members of
the Casino Board and such action 
14is accompanied by a written statement setting forth the reasons 
15for not awarding the contract to the highest or
lowest 
16proposer, as the case
may be. The statement shall be kept on 
17file in the principal office of the
Authority and open to 
18public inspection.

19 (g) The Authority shall have the right to reject all 
20proposals and to
re-advertise for proposals. If after
any such 
21re-advertisement, no responsible and satisfactory proposals, 
22within the
terms of the re-advertisement, is received, the 
23Authority may award such
contract without competitive 
24selection. The contract must not be less
advantageous to the 
25Authority than any valid proposal received pursuant to

26advertisement.

 
 
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1 (h) Advertisements for proposals and re-proposals shall be 
2published at least once in
a daily newspaper of general 
3circulation published in the City
at least 10 calendar days 
4before the time for
receiving proposals and in an online 
5bulletin published on the Authority's website. Such

6advertisements shall state the time and
place for receiving and 
7opening of proposals and, by reference to plans and

8specifications on file at the time of the first publication or 
9in the
advertisement itself, shall describe the character of 
10the proposed contract in
sufficient detail to fully advise 
11prospective proposers of their obligations and
to ensure free 
12and open competitive selection.

13 (i) All proposals in response to advertisements shall be 
14sealed and shall be
publicly opened by the Authority. All 
15proposers shall be entitled to be present
in person or by 
16representatives. Cash or a certified or satisfactory cashier's

17check, as a deposit of good faith, in a reasonable amount to be 
18fixed by the
Authority before advertising for proposals, shall 
19be required with the proposal. A bond for faithful performance 
20of the contract with surety or
sureties satisfactory to the

21Authority and adequate insurance may be required in reasonable 
22amounts to be
fixed by the Authority before advertising for 
23proposals.

24 (j) The contract shall be awarded as promptly as possible 
25after the opening
of proposals. The proposal of the successful 
26proposer, as well as the bids of the
unsuccessful proposers, 
 
 
09800SB1739sam001- 45 -LRB098 10559 AMC 42403 a


1shall be placed on file and be open to public inspection 
2subject to the exemptions from disclosure provided under 
3Section 7 of the Freedom of Information Act.
All proposals 
4shall be void if any disclosure of the terms of any proposals 
5in response
to an advertisement is made or permitted to be made 
6by the Authority before the
time fixed for opening proposals.

7 (k) Notice of each and every contract that is
offered, 
8including renegotiated contracts and change orders,
shall be 
9published in an online bulletin. The online bulletin must 
10include at least the date first offered,
the date submission of 
11offers is due, the location that offers are to be
submitted to, 
12a brief purchase description, the method of source selection,

13information of how to obtain a comprehensive purchase 
14description and any
disclosure and contract forms, and 
15encouragement to prospective vendors to hire qualified 
16veterans, as defined by Section 45-67 of the Illinois 
17Procurement Code, and Illinois residents discharged from any 
18Illinois adult correctional center subject to Gaming Board 
19licensing and eligibility rules. Notice of each and every 
20contract that is let
or awarded, including renegotiated 
21contracts and change orders, shall be
published in the online 
22bulletin and
must include at least all of the
information 
23specified in this subsection (k), as well as the name of the 
24successful
responsible proposer or offeror, the contract 
25price, and the number of unsuccessful
responsive proposers and 
26any other disclosure specified in this Section. This notice 
 
 
09800SB1739sam001- 46 -LRB098 10559 AMC 42403 a


1must be posted in the online electronic bulletin prior to 
2execution of the contract.


3 Section 1-130. Affirmative action and equal opportunity 
4obligations of
Authority. 
5 (a) The Authority is subject to the requirements of Article 
6IV of Chapter 2-92 (Sections 2-92-650 through 2-92-720 
7inclusive) of the Chicago Municipal Code, as now or hereafter 
8amended, renumbered, or succeeded, concerning a Minority-Owned 
9and Women-Owned Business Enterprise Procurement Program for 
10construction contracts, and Section 2-92-420 et seq. of the 
11Chicago Municipal Code, as now or hereafter amended, 
12renumbered, or succeeded, concerning a Minority-Owned and 
13Women-Owned Business Enterprise Procurement Program.

14 (b) The Authority is authorized to enter into agreements 
15with contractors'
associations, labor unions, and the 
16contractors working on the development of
the casino to 
17establish an apprenticeship preparedness training program to

18provide for an increase in the number of minority and female 
19journeymen and
apprentices in the building trades and to enter 
20into agreements with
community college districts or other 
21public or private institutions to provide
readiness training. 
22The Authority is further authorized to enter into
contracts 
23with public and private educational institutions and persons in 
24the
gaming, entertainment, hospitality, and tourism industries 
25to provide training
for employment in those industries.


 
 
09800SB1739sam001- 47 -LRB098 10559 AMC 42403 a


1 Section 1-135. Transfer of interest. Neither the Authority 
2nor the City may sell, lease, rent, transfer, exchange, or 
3otherwise convey any interest that they have in the casino 
4without prior approval of the General Assembly.

5 Section 1-140. Home rule. The regulation and licensing of 
6casinos and casino gaming, casino gaming facilities, and casino 
7operator licensees under this Act are exclusive powers and 
8functions of the State. A home rule unit may not regulate or 
9license casinos, casino gaming, casino gaming facilities, or 
10casino operator licensees under this Act, except as provided 
11under this Act. This Section is a denial and limitation of home 
12rule powers and functions under subsection (h) of Section 6 of 
13Article VII of the Illinois Constitution.



14 Section 1-145. Prohibition of political contributions from 
15casino operator licensees and applicants. 
16 (a) The General Assembly has a compelling interest in 
17protecting the integrity of both the electoral process and the 
18legislative process by preventing corruption and the 
19appearance of corruption which may arise through permitting 
20certain political campaign contributions by certain persons 
21involved in the gaming industry and regulated by the State. 
22Unlike most other regulated industries, gaming is especially 
23susceptible to corruption and potential criminal influence. In 
 
 
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1Illinois, only licensed gaming activities are legal and all 
2other gaming activities are strictly prohibited. Given these 
3circumstances, it is imperative to eliminate any potential 
4corrupt influence in the gaming industry and the electoral 
5process.
6 Banning political campaign contributions by certain 
7persons subject to this Section to State officeholders and 
8candidates for such offices and to county and municipal 
9officeholders and candidates for such offices in counties and 
10municipalities that receive financial benefits from gaming 
11activities is necessary to prevent corruption and the 
12appearance of corruption that may arise when political campaign 
13contributions and gaming that is regulated by the State and 
14that confers benefits on counties and municipalities are 
15intermingled.
16 The General Assembly has prohibited political campaign 
17contributions to certain State and local officeholders and 
18candidates for such offices by certain persons with State of 
19Illinois and Metropolitan Pier and Exposition Authority 
20contracts and pending bids or proposals for contracts of over 
21$50,000 and certain individuals and entities affiliated with 
22such persons. Certain gaming licensees will receive receipts 
23far in excess of the base level of contract amounts subject to 
24such other campaign contribution prohibitions.
25 (b) As used in this Section:
26 "Affiliated entity" means (i) any corporate parent and 
 
 
09800SB1739sam001- 49 -LRB098 10559 AMC 42403 a


1operating subsidiary of the business entity applying for or 
2holding a license, (ii) each operating subsidiary of the 
3corporate parent of the business entity applying for or holding 
4a license, (iii) any organization recognized by the United 
5States Internal Revenue Service as a tax-exempt organization 
6described in Section 501(c) of the Internal Revenue Code of 
71986 (or any successor provision of federal tax law) 
8established by one or more business entities seeking or holding 
9a license, any affiliated entity of such business entity, or 
10any affiliated person of such business entity, and (iv) any 
11political committee for which the business entity applying for 
12or holding a license, or any 501(c) organization described in 
13item (iii) related to that business entity, is the sponsoring 
14entity as defined in Section 9-3 of the Election Code. For 
15purposes of item (iv), the funding of all business entities 
16applying for or holding a license shall be aggregated in 
17determining whether such political committee is an affiliated 
18entity.
19 "Affiliated person" means (i) any person with any ownership 
20interest or distributive share in excess of 7.5% of any 
21business entity applying for or holding a license, (ii) 
22executive employees of any such business entity, (iii) any 
23person designated as a key person under the Illinois Gambling 
24Act, and (iv) the spouse of the persons described in items (i) 
25through (iii).
26 "Business entity" means any entity doing business for 
 
 
09800SB1739sam001- 50 -LRB098 10559 AMC 42403 a


1profit, whether organized as a corporation, partnership, sole 
2proprietorship, limited liability company, or partnership or 
3otherwise.
4 "Contribution" means a contribution as defined in Section 
59-1.4 of the Election Code.
6 "Declared candidate" means a person who has filed a 
7statement of candidacy and petition for nomination or election 
8in the principal office of the State Board of Elections, or in 
9the office of the appropriate election authority for any county 
10or municipality in which a casino is located or proposed or 
11which receives any gaming revenue.
12 "Executive employee" means (i) any person who is an officer 
13or director or who fulfills duties equivalent to those of an 
14officer or director of a business entity applying for or 
15holding a license and (ii) any employee of such business entity 
16who is required to register under the Lobbyist Registration 
17Act.
18 "License" means the casino operator license issued 
19pursuant to this Act.
20 "Officeholder" means the Governor, Lieutenant Governor, 
21Attorney General, Secretary of State, Comptroller, Treasurer, 
22member of the General Assembly, or any officeholder in any 
23county or municipality in which a riverboat, casino, or 
24electronic gaming device is located or proposed or that 
25receives any gaming revenue.
26 (c) Any person or business entity applying for or holding a 
 
 
09800SB1739sam001- 51 -LRB098 10559 AMC 42403 a


1license, any affiliated entities or persons of such business 
2entity, and any entities or persons soliciting a contribution 
3or causing a contribution to be made on behalf of such person 
4or business entity, are prohibited from making any contribution 
5to any officeholder or declared candidate or any political 
6committee affiliated with any officeholder or declared 
7candidate, as defined in Section 9-1.8 of the Election Code. 
8This prohibition shall commence upon filing of an application 
9for a license and shall continue for a period of 2 years after 
10termination, suspension or revocation of the license.
11 The Gaming Board shall have authority to suspend, revoke, 
12or restrict the license and to impose civil penalties of up to 
13$100,000 for each violation of this subsection (c). A notice of 
14each such violation and the penalty imposed shall be published 
15on the Gaming Board's Internet website and in the Illinois 
16Register. Payments received by the State pursuant to this 
17subsection (c) shall be deposited into the General Revenue 
18Fund.

19 Any officeholder or declared candidate or any political 
20committee affiliated with any officeholder or declared 
21candidate that has received a contribution in violation of this 
22subsection (c) shall pay an amount equal to the value of the 
23contribution to the State no more than 30 days after notice of 
24the violation concerning the contribution appears in the 
25Illinois Register. Payments received by the State pursuant to 
26this subsection (c) shall be deposited into the General Revenue 
 
 
09800SB1739sam001- 52 -LRB098 10559 AMC 42403 a


1Fund.
2 (d) The Gaming Board shall post on its Internet website a 
3list of all persons, business entities, and affiliated entities 
4prohibited from making contributions to any officeholder or 
5declared candidate political committee pursuant to subsection 
6(c), which list shall be updated and published, at a minimum, 
7every 6 months.
8 Any person, business entity, or affiliated entity 
9prohibited from making contributions to any officeholder or 
10declared candidate political committee pursuant to subsection 
11(c) shall notify the Gaming Board within 7 days after 
12discovering any necessary change or addition to the information 
13relating to that person, business entity, or affiliated entity 
14contained in the list.
15 An individual who acts in good faith and in reliance on any 
16information contained in the list shall not be subject to any 
17penalties or liability imposed for a violation of this Section.
18 (e) If any provision of this Section is held invalid or its 
19application to any person or circumstance is held invalid, the 
20invalidity of that provision or application does not affect the 
21other provisions or applications of this Section that can be 
22given effect without the invalid application or provision.

23
ARTICLE 90.


24 Section 90-1. Findings. The General Assembly makes all of 
 
 
09800SB1739sam001- 53 -LRB098 10559 AMC 42403 a


1the following findings:
2  (1) That the cumulative reduction to pre-K through 12 
3 education funding since 2009 is approximately 
4 $861,000,000.
5  (2) That during the last 2 years, general state aid to 
6 Illinois common schools has been underfunded as a result of 
7 budget cuts, resulting in pro-rated payments to school 
8 districts that are less than the foundational level of 
9 $6,119 per pupil, which represents the minimum each pupil 
10 needs to be educated.
11  (3) That a significant infusion of new revenue is 
12 necessary in order to fully fund the foundation level and 
13 to maintain and support education in Illinois.
14  (4) That the decline of the Illinois horse racing and 
15 breeding program, a $2.5 billion industry, would be 
16 reversed if this amendatory Act of the 98th General 
17 Assembly would be enacted.
18  (5) That the Illinois horse racing industry is on the 
19 verge of extinction due to fierce competition from fully 
20 developed horse racing and gaming operations in other 
21 states.
22  (6) That allowing the State's horse racing venues, 
23 currently licensed gaming destinations, to maximize their 
24 capacities with gaming machines, would generate up to $120 
25 million to $200 million for the State in the form of extra 
26 licensing fees, plus an additional $100 million to $300 
 
 
09800SB1739sam001- 54 -LRB098 10559 AMC 42403 a


1 million in recurring annual tax revenue for the State to 
2 help ensure that school, road, and other building projects 
3 promised under the capital plan occur on schedule.
4  (7) That Illinois agriculture and other businesses 
5 that support and supply the horse racing industry, already 
6 a sector that employs over 37,000 Illinoisans, also stand 
7 to substantially benefit and would be much more likely to 
8 create additional jobs should Illinois horse racing once 
9 again become competitive with other states.
10  (8) That by keeping these projects on track, the State 
11 can be sure that significant job and economic growth will 
12 in fact result from the previously enacted legislation.
13  (9) That gaming machines at Illinois horse racing 
14 tracks would create an estimated 1,200 to 1,500 permanent 
15 jobs, and an estimated capital investment of up to $200 
16 million to $400 million at these race tracks would prompt 
17 additional trade organization jobs necessary to construct 
18 new facilities or remodel race tracks to operate electronic 
19 gaming.

20 Section 90-2. The Illinois Administrative Procedure Act is 
21amended by changing Section 5-45 as follows:

22 (5 ILCS 100/5-45) (from Ch. 127, par. 1005-45)
23 Sec. 5-45. Emergency rulemaking. 
24 (a) "Emergency" means the existence of any situation that 
 
 
09800SB1739sam001- 55 -LRB098 10559 AMC 42403 a


1any agency
finds reasonably constitutes a threat to the public 
2interest, safety, or
welfare.
3 (b) If any agency finds that an
emergency exists that 
4requires adoption of a rule upon fewer days than
is required by 
5Section 5-40 and states in writing its reasons for that

6finding, the agency may adopt an emergency rule without prior 
7notice or
hearing upon filing a notice of emergency rulemaking 
8with the Secretary of
State under Section 5-70. The notice 
9shall include the text of the
emergency rule and shall be 
10published in the Illinois Register. Consent
orders or other 
11court orders adopting settlements negotiated by an agency
may 
12be adopted under this Section. Subject to applicable 
13constitutional or
statutory provisions, an emergency rule 
14becomes effective immediately upon
filing under Section 5-65 or 
15at a stated date less than 10 days
thereafter. The agency's 
16finding and a statement of the specific reasons
for the finding 
17shall be filed with the rule. The agency shall take
reasonable 
18and appropriate measures to make emergency rules known to the

19persons who may be affected by them.
20 (c) An emergency rule may be effective for a period of not 
21longer than
150 days, but the agency's authority to adopt an 
22identical rule under Section
5-40 is not precluded. No 
23emergency rule may be adopted more
than once in any 24 month 
24period, except that this limitation on the number
of emergency 
25rules that may be adopted in a 24 month period does not apply

26to (i) emergency rules that make additions to and deletions 
 
 
09800SB1739sam001- 56 -LRB098 10559 AMC 42403 a


1from the Drug
Manual under Section 5-5.16 of the Illinois 
2Public Aid Code or the
generic drug formulary under Section 
33.14 of the Illinois Food, Drug
and Cosmetic Act, (ii) 
4emergency rules adopted by the Pollution Control
Board before 
5July 1, 1997 to implement portions of the Livestock Management

6Facilities Act, (iii) emergency rules adopted by the Illinois 
7Department of Public Health under subsections (a) through (i) 
8of Section 2 of the Department of Public Health Act when 
9necessary to protect the public's health, (iv) emergency rules 
10adopted pursuant to subsection (n) of this Section, (v) 
11emergency rules adopted pursuant to subsection (o) of this 
12Section, or (vi) emergency rules adopted pursuant to subsection 
13(c-5) of this Section. Two or more emergency rules having 
14substantially the same
purpose and effect shall be deemed to be 
15a single rule for purposes of this
Section.
16 (c-5) To facilitate the maintenance of the program of group 
17health benefits provided to annuitants, survivors, and retired 
18employees under the State Employees Group Insurance Act of 
191971, rules to alter the contributions to be paid by the State, 
20annuitants, survivors, retired employees, or any combination 
21of those entities, for that program of group health benefits, 
22shall be adopted as emergency rules. The adoption of those 
23rules shall be considered an emergency and necessary for the 
24public interest, safety, and welfare. 
25 (d) In order to provide for the expeditious and timely 
26implementation
of the State's fiscal year 1999 budget, 
 
 
09800SB1739sam001- 57 -LRB098 10559 AMC 42403 a


1emergency rules to implement any
provision of Public Act 90-587 
2or 90-588
or any other budget initiative for fiscal year 1999 
3may be adopted in
accordance with this Section by the agency 
4charged with administering that
provision or initiative, 
5except that the 24-month limitation on the adoption
of 
6emergency rules and the provisions of Sections 5-115 and 5-125 
7do not apply
to rules adopted under this subsection (d). The 
8adoption of emergency rules
authorized by this subsection (d) 
9shall be deemed to be necessary for the
public interest, 
10safety, and welfare.
11 (e) In order to provide for the expeditious and timely 
12implementation
of the State's fiscal year 2000 budget, 
13emergency rules to implement any
provision of this amendatory 
14Act of the 91st General Assembly
or any other budget initiative 
15for fiscal year 2000 may be adopted in
accordance with this 
16Section by the agency charged with administering that
provision 
17or initiative, except that the 24-month limitation on the 
18adoption
of emergency rules and the provisions of Sections 
195-115 and 5-125 do not apply
to rules adopted under this 
20subsection (e). The adoption of emergency rules
authorized by 
21this subsection (e) shall be deemed to be necessary for the

22public interest, safety, and welfare.
23 (f) In order to provide for the expeditious and timely 
24implementation
of the State's fiscal year 2001 budget, 
25emergency rules to implement any
provision of this amendatory 
26Act of the 91st General Assembly
or any other budget initiative 
 
 
09800SB1739sam001- 58 -LRB098 10559 AMC 42403 a


1for fiscal year 2001 may be adopted in
accordance with this 
2Section by the agency charged with administering that
provision 
3or initiative, except that the 24-month limitation on the 
4adoption
of emergency rules and the provisions of Sections 
55-115 and 5-125 do not apply
to rules adopted under this 
6subsection (f). The adoption of emergency rules
authorized by 
7this subsection (f) shall be deemed to be necessary for the

8public interest, safety, and welfare.
9 (g) In order to provide for the expeditious and timely 
10implementation
of the State's fiscal year 2002 budget, 
11emergency rules to implement any
provision of this amendatory 
12Act of the 92nd General Assembly
or any other budget initiative 
13for fiscal year 2002 may be adopted in
accordance with this 
14Section by the agency charged with administering that
provision 
15or initiative, except that the 24-month limitation on the 
16adoption
of emergency rules and the provisions of Sections 
175-115 and 5-125 do not apply
to rules adopted under this 
18subsection (g). The adoption of emergency rules
authorized by 
19this subsection (g) shall be deemed to be necessary for the

20public interest, safety, and welfare.
21 (h) In order to provide for the expeditious and timely 
22implementation
of the State's fiscal year 2003 budget, 
23emergency rules to implement any
provision of this amendatory 
24Act of the 92nd General Assembly
or any other budget initiative 
25for fiscal year 2003 may be adopted in
accordance with this 
26Section by the agency charged with administering that
provision 
 
 
09800SB1739sam001- 59 -LRB098 10559 AMC 42403 a


1or initiative, except that the 24-month limitation on the 
2adoption
of emergency rules and the provisions of Sections 
35-115 and 5-125 do not apply
to rules adopted under this 
4subsection (h). The adoption of emergency rules
authorized by 
5this subsection (h) shall be deemed to be necessary for the

6public interest, safety, and welfare.
7 (i) In order to provide for the expeditious and timely 
8implementation
of the State's fiscal year 2004 budget, 
9emergency rules to implement any
provision of this amendatory 
10Act of the 93rd General Assembly
or any other budget initiative 
11for fiscal year 2004 may be adopted in
accordance with this 
12Section by the agency charged with administering that
provision 
13or initiative, except that the 24-month limitation on the 
14adoption
of emergency rules and the provisions of Sections 
155-115 and 5-125 do not apply
to rules adopted under this 
16subsection (i). The adoption of emergency rules
authorized by 
17this subsection (i) shall be deemed to be necessary for the

18public interest, safety, and welfare.
19 (j) In order to provide for the expeditious and timely 
20implementation of the provisions of the State's fiscal year 
212005 budget as provided under the Fiscal Year 2005 Budget 
22Implementation (Human Services) Act, emergency rules to 
23implement any provision of the Fiscal Year 2005 Budget 
24Implementation (Human Services) Act may be adopted in 
25accordance with this Section by the agency charged with 
26administering that provision, except that the 24-month 
 
 
09800SB1739sam001- 60 -LRB098 10559 AMC 42403 a


1limitation on the adoption of emergency rules and the 
2provisions of Sections 5-115 and 5-125 do not apply to rules 
3adopted under this subsection (j). The Department of Public Aid 
4may also adopt rules under this subsection (j) necessary to 
5administer the Illinois Public Aid Code and the Children's 
6Health Insurance Program Act. The adoption of emergency rules 
7authorized by this subsection (j) shall be deemed to be 
8necessary for the public interest, safety, and welfare.

9 (k) In order to provide for the expeditious and timely 
10implementation of the provisions of the State's fiscal year 
112006 budget, emergency rules to implement any provision of this 
12amendatory Act of the 94th General Assembly or any other budget 
13initiative for fiscal year 2006 may be adopted in accordance 
14with this Section by the agency charged with administering that 
15provision or initiative, except that the 24-month limitation on 
16the adoption of emergency rules and the provisions of Sections 
175-115 and 5-125 do not apply to rules adopted under this 
18subsection (k). The Department of Healthcare and Family 
19Services may also adopt rules under this subsection (k) 
20necessary to administer the Illinois Public Aid Code, the 
21Senior Citizens and Disabled Persons Property Tax Relief Act, 
22the Senior Citizens and Disabled Persons Prescription Drug 
23Discount Program Act (now the Illinois Prescription Drug 
24Discount Program Act), and the Children's Health Insurance 
25Program Act. The adoption of emergency rules authorized by this 
26subsection (k) shall be deemed to be necessary for the public 
 
 
09800SB1739sam001- 61 -LRB098 10559 AMC 42403 a


1interest, safety, and welfare.

2 (l) In order to provide for the expeditious and timely 
3implementation of the provisions of the
State's fiscal year 
42007 budget, the Department of Healthcare and Family Services 
5may adopt emergency rules during fiscal year 2007, including 
6rules effective July 1, 2007, in
accordance with this 
7subsection to the extent necessary to administer the 
8Department's responsibilities with respect to amendments to 
9the State plans and Illinois waivers approved by the federal 
10Centers for Medicare and Medicaid Services necessitated by the 
11requirements of Title XIX and Title XXI of the federal Social 
12Security Act. The adoption of emergency rules
authorized by 
13this subsection (l) shall be deemed to be necessary for the 
14public interest,
safety, and welfare.

15 (m) In order to provide for the expeditious and timely 
16implementation of the provisions of the
State's fiscal year 
172008 budget, the Department of Healthcare and Family Services 
18may adopt emergency rules during fiscal year 2008, including 
19rules effective July 1, 2008, in
accordance with this 
20subsection to the extent necessary to administer the 
21Department's responsibilities with respect to amendments to 
22the State plans and Illinois waivers approved by the federal 
23Centers for Medicare and Medicaid Services necessitated by the 
24requirements of Title XIX and Title XXI of the federal Social 
25Security Act. The adoption of emergency rules
authorized by 
26this subsection (m) shall be deemed to be necessary for the 
 
 
09800SB1739sam001- 62 -LRB098 10559 AMC 42403 a


1public interest,
safety, and welfare.

2 (n) In order to provide for the expeditious and timely 
3implementation of the provisions of the State's fiscal year 
42010 budget, emergency rules to implement any provision of this 
5amendatory Act of the 96th General Assembly or any other budget 
6initiative authorized by the 96th General Assembly for fiscal 
7year 2010 may be adopted in accordance with this Section by the 
8agency charged with administering that provision or 
9initiative. The adoption of emergency rules authorized by this 
10subsection (n) shall be deemed to be necessary for the public 
11interest, safety, and welfare. The rulemaking authority 
12granted in this subsection (n) shall apply only to rules 
13promulgated during Fiscal Year 2010. 
14 (o) In order to provide for the expeditious and timely 
15implementation of the provisions of the State's fiscal year 
162011 budget, emergency rules to implement any provision of this 
17amendatory Act of the 96th General Assembly or any other budget 
18initiative authorized by the 96th General Assembly for fiscal 
19year 2011 may be adopted in accordance with this Section by the 
20agency charged with administering that provision or 
21initiative. The adoption of emergency rules authorized by this 
22subsection (o) is deemed to be necessary for the public 
23interest, safety, and welfare. The rulemaking authority 
24granted in this subsection (o) applies only to rules 
25promulgated on or after the effective date of this amendatory 
26Act of the 96th General Assembly through June 30, 2011. 
 
 
09800SB1739sam001- 63 -LRB098 10559 AMC 42403 a


1 (p) In order to provide for the expeditious and timely 
2implementation of the provisions of Public Act 97-689 this 
3amendatory Act of the 97th General Assembly, emergency rules to 
4implement any provision of Public Act 97-689 this amendatory 
5Act of the 97th General Assembly may be adopted in accordance 
6with this subsection (p) by the agency charged with 
7administering that provision or initiative. The 150-day 
8limitation of the effective period of emergency rules does not 
9apply to rules adopted under this subsection (p), and the 
10effective period may continue through June 30, 2013. The 
1124-month limitation on the adoption of emergency rules does not 
12apply to rules adopted under this subsection (p). The adoption 
13of emergency rules authorized by this subsection (p) is deemed 
14to be necessary for the public interest, safety, and welfare.
15 (q) In order to provide for the expeditious and timely 
16implementation of Internet gaming, the Division of Internet 
17Gaming may adopt emergency rules to implement the provisions of 
18Section 7.18 of the Illinois Lottery Law. The adoption of 
19emergency rules authorized by this subsection (q) shall be 
20deemed to be necessary for the public interest, safety, and 
21welfare. 
22(Source: P.A. 96-45, eff. 7-15-09; 96-958, eff. 7-1-10; 
2396-1500, eff. 1-18-11; 97-689, eff. 6-14-12; 97-695, eff. 
247-1-12; revised 7-10-12.)

25 Section 90-3. The State Officials and Employees Ethics Act 
 
 
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1is amended by changing Sections 5-45 and 20-10 as follows:

2 (5 ILCS 430/5-45)

3 Sec. 5-45. Procurement; revolving door prohibition.

4 (a) No former officer, member, or State employee, or spouse 
5or
immediate family member living with such person, shall, 
6within a period of one
year immediately after termination of 
7State employment, knowingly accept
employment or receive 
8compensation or fees for services from a person or entity
if 
9the officer, member, or State employee, during the year 
10immediately
preceding termination of State employment, 
11participated personally and
substantially in the award of State 
12contracts, or the issuance of State contract change orders, 
13with a cumulative value
of $25,000
or more to the person or 
14entity, or its parent or subsidiary.


15 (b) No former officer of the executive branch or State 
16employee of the
executive branch with regulatory or
licensing 
17authority, or spouse or immediate family member living with 
18such
person, shall, within a period of one year immediately 
19after termination of
State employment, knowingly accept 
20employment or receive compensation or fees
for services from a 
21person or entity if the officer
or State
employee, during the 
22year immediately preceding
termination of State employment, 
23participated personally and substantially in making a 
24regulatory or licensing decision that
directly applied to the 
25person or entity, or its parent or subsidiary. 

 
 
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1 (c) Within 6 months after the effective date of this 
2amendatory Act of the 96th General Assembly, each executive 
3branch constitutional officer and legislative leader, the 
4Auditor General, and the Joint Committee on Legislative Support 
5Services shall adopt a policy delineating which State positions 
6under his or her jurisdiction and control, by the nature of 
7their duties, may have the authority to participate personally 
8and substantially in the award of State contracts or in 
9regulatory or licensing decisions. The Governor shall adopt 
10such a policy for all State employees of the executive branch 
11not under the jurisdiction and control of any other executive 
12branch constitutional officer.


13 The policies required under subsection (c) of this Section 
14shall be filed with the appropriate ethics commission 
15established under this Act or, for the Auditor General, with 
16the Office of the Auditor General.
17 (d) Each Inspector General shall have the authority to 
18determine that additional State positions under his or her 
19jurisdiction, not otherwise subject to the policies required by 
20subsection (c) of this Section, are nonetheless subject to the 
21notification requirement of subsection (f) below due to their 
22involvement in the award of State contracts or in regulatory or 
23licensing decisions.
24 (e) The Joint Committee on Legislative Support Services, 
25the Auditor General, and each of the executive branch 
26constitutional officers and legislative leaders subject to 
 
 
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1subsection (c) of this Section shall provide written 
2notification to all employees in positions subject to the 
3policies required by subsection (c) or a determination made 
4under subsection (d): (1) upon hiring, promotion, or transfer 
5into the relevant position; and (2) at the time the employee's 
6duties are changed in such a way as to qualify that employee. 
7An employee receiving notification must certify in writing that 
8the person was advised of the prohibition and the requirement 
9to notify the appropriate Inspector General in subsection (f).
10 (f) Any State employee in a position subject to the 
11policies required by subsection (c) or to a determination under 
12subsection (d), but who does not fall within the prohibition of 
13subsection (h) below, who is offered non-State employment 
14during State employment or within a period of one year 
15immediately after termination of State employment shall, prior 
16to accepting such non-State employment, notify the appropriate 
17Inspector General. Within 10 calendar days after receiving 
18notification from an employee in a position subject to the 
19policies required by subsection (c), such Inspector General 
20shall make a determination as to whether the State employee is 
21restricted from accepting such employment by subsection (a) or 
22(b). In making a determination, in addition to any other 
23relevant information, an Inspector General shall assess the 
24effect of the prospective employment or relationship upon 
25decisions referred to in subsections (a) and (b), based on the 
26totality of the participation by the former officer, member, or 
 
 
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1State employee in those decisions. A determination by an 
2Inspector General must be in writing, signed and dated by the 
3Inspector General, and delivered to the subject of the 
4determination within 10 calendar days or the person is deemed 
5eligible for the employment opportunity. For purposes of this 
6subsection, "appropriate Inspector General" means (i) for 
7members and employees of the legislative branch, the 
8Legislative Inspector General; (ii) for the Auditor General and 
9employees of the Office of the Auditor General, the Inspector 
10General provided for in Section 30-5 of this Act; and (iii) for 
11executive branch officers and employees, the Inspector General 
12having jurisdiction over the officer or employee. Notice of any 
13determination of an Inspector General and of any such appeal 
14shall be given to the ultimate jurisdictional authority, the 
15Attorney General, and the Executive Ethics Commission.
16 (g) An Inspector General's determination regarding 
17restrictions under subsection (a) or (b) may be appealed to the 
18appropriate Ethics Commission by the person subject to the 
19decision or the Attorney General no later than the 10th 
20calendar day after the date of the determination.
21 On appeal, the Ethics Commission or Auditor General shall 
22seek, accept, and consider written public comments regarding a 
23determination. In deciding whether to uphold an Inspector 
24General's determination, the appropriate Ethics Commission or 
25Auditor General shall assess, in addition to any other relevant 
26information, the effect of the prospective employment or 
 
 
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1relationship upon the decisions referred to in subsections (a) 
2and (b), based on the totality of the participation by the 
3former officer, member, or State employee in those decisions. 
4The Ethics Commission shall decide whether to uphold an 
5Inspector General's determination within 10 calendar days or 
6the person is deemed eligible for the employment opportunity.
7 (h) The following officers, members, or State employees 
8shall not, within a period of one year immediately after 
9termination of office or State employment, knowingly accept 
10employment or receive compensation or fees for services from a 
11person or entity if the person or entity or its parent or 
12subsidiary, during the year immediately preceding termination 
13of State employment, was a party to a State contract or 
14contracts with a cumulative value of $25,000 or more involving 
15the officer, member, or State employee's State agency, or was 
16the subject of a regulatory or licensing decision involving the 
17officer, member, or State employee's State agency, regardless 
18of whether he or she participated personally and substantially 
19in the award of the State contract or contracts or the making 
20of the regulatory or licensing decision in question:
21  (1) members or officers;
22  (2) members of a commission or board created by the 
23 Illinois Constitution;
24  (3) persons whose appointment to office is subject to 
25 the advice and consent of the Senate;
26  (4) the head of a department, commission, board, 
 
 
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1 division, bureau, authority, or other administrative unit 
2 within the government of this State;
3  (5) chief procurement officers, State purchasing 
4 officers, and their designees whose duties are directly 
5 related to State procurement; and
6  (6) chiefs of staff, deputy chiefs of staff, associate 
7 chiefs of staff, assistant chiefs of staff, and deputy 
8 governors; .
9  (7) employees of the Illinois Racing Board; and
10  (8) employees of the Illinois Gaming Board. 
11 (i) For the purposes of this Section, with respect to 
12officers or employees of a regional transit board, as defined 
13in this Act, the phrase "person or entity" does not include: 
14(i) the United States government, (ii) the State, (iii) 
15municipalities, as defined under Article VII, Section 1 of the 
16Illinois Constitution, (iv) units of local government, as 
17defined under Article VII, Section 1 of the Illinois 
18Constitution, or (v) school districts. 
19(Source: P.A. 96-555, eff. 8-18-09; 97-653, eff. 1-13-12.)

20 (5 ILCS 430/20-10)

21 Sec. 20-10. Offices of Executive Inspectors General.


22 (a) Six Five independent Offices of the Executive Inspector 
23General are
created,
one each for the Governor, the Attorney 
24General, the Secretary of State, the
Comptroller, and the 
25Treasurer and one for gaming activities. Each Office shall be 
 
 
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1under the direction and
supervision
of an Executive Inspector 
2General and shall be a fully independent office with
separate

3appropriations.

4 (b) The Governor, Attorney General, Secretary of State, 
5Comptroller, and
Treasurer shall each appoint an Executive 
6Inspector General, and the Governor shall appoint an Executive 
7Inspector General for gaming activities. Each appointment must 
8be made without regard to
political affiliation and solely on 
9the basis of integrity and
demonstrated ability.
Appointments 
10shall be made by and with the advice and consent of the
Senate 
11by three-fifths of the elected members concurring by record 
12vote.
Any nomination not acted upon by the Senate within 60 
13session days of the
receipt thereof shall be deemed to have 
14received the advice and consent of
the Senate. If, during a 
15recess of the Senate, there is a vacancy in an office
of 
16Executive Inspector General, the appointing authority shall 
17make a
temporary appointment until the next meeting of the 
18Senate when the
appointing authority shall make a nomination to 
19fill that office. No person
rejected for an office of Executive 
20Inspector General shall, except by the
Senate's request, be 
21nominated again for that office at the same session of
the 
22Senate or be appointed to that office during a recess of that 
23Senate.

24 Nothing in this Article precludes the appointment by the 
25Governor, Attorney
General,
Secretary of State, Comptroller, 
26or Treasurer of any other inspector general
required or

 
 
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1permitted by law. The Governor, Attorney General, Secretary of 
2State,
Comptroller, and
Treasurer
each may appoint an existing 
3inspector general as the Executive Inspector
General
required 
4by this
Article, provided that such an inspector general is not 
5prohibited by law,
rule,
jurisdiction, qualification, or 
6interest from serving as the Executive
Inspector General

7required by
this Article.
An appointing authority may not 
8appoint a relative as an Executive Inspector
General.


9 Each Executive Inspector General shall have the following 
10qualifications:


11  (1) has not been convicted of any felony under the laws 
12 of this State,
another State, or the United States;

13  (2) has earned a baccalaureate degree from an 
14 institution of higher
education; and


15  (3) has 5 or more years of cumulative service (A) with 
16 a federal,
State, or
local law enforcement agency, at least 
17 2 years of which have been in a
progressive investigatory 
18 capacity; (B)
as a
federal, State, or local prosecutor; (C)

19 as a
senior manager or executive of a federal, State, or 
20 local
agency; (D) as a member, an officer,
or a State
or 
21 federal judge; or (E) representing any combination of (A) 
22 through (D).


23 The term of each initial Executive Inspector General shall

24commence upon qualification and shall run through June 30, 
252008. The
initial appointments shall be made within 60 days 
26after the effective
date of this Act.

 
 
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1 After the initial term, each Executive Inspector General 
2shall serve
for 5-year terms commencing on July 1 of the year 
3of appointment
and running through June 30 of the fifth 
4following year. An
Executive Inspector General may be 
5reappointed to one or more
subsequent terms.

6 A vacancy occurring other than at the end of a term shall 
7be filled
by the appointing authority only for the balance of 
8the term of the Executive
Inspector General whose office is 
9vacant.

10 Terms shall run regardless of whether the position is 
11filled.

12 (c) The Executive Inspector General appointed by the 
13Attorney General shall
have jurisdiction over the Attorney 
14General and all officers and employees of,
and vendors and 
15others doing business with,
State agencies within the 
16jurisdiction of the Attorney General. The Executive
Inspector 
17General appointed by the Secretary of State shall have 
18jurisdiction
over the Secretary of State and all officers and 
19employees of, and vendors and
others doing business with, State 
20agencies within the
jurisdiction of the Secretary of State. The 
21Executive Inspector General
appointed by the Comptroller shall 
22have jurisdiction over the Comptroller and
all officers and 
23employees of, and vendors and others doing business with,
State 
24agencies within the jurisdiction of the Comptroller. The

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

17 The jurisdiction of each Executive Inspector General is to 
18investigate
allegations of fraud, waste, abuse, mismanagement, 
19misconduct, nonfeasance,
misfeasance,
malfeasance, or 
20violations of this Act or violations of other related
laws and 
21rules.


22 (d) The compensation for each Executive Inspector General 
23shall be
determined by the Executive Ethics Commission and 
24shall be made from appropriations made to the Comptroller for 
25this purpose. Subject to Section 20-45 of this Act, each

26Executive Inspector General has full
authority
to organize his 
 
 
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1or her Office of the Executive Inspector General, including the

2employment and determination of the compensation of staff, such 
3as deputies,
assistants, and other employees, as 
4appropriations permit. A separate
appropriation
shall be made 
5for each Office of Executive Inspector General.


6 (e) No Executive Inspector General or employee of the 
7Office of
the Executive Inspector General may, during his or 
8her term of appointment or
employment:


9  (1) become a candidate for any elective office;


10  (2) hold any other elected or appointed public office

11 except for appointments on governmental advisory boards
or 
12 study commissions or as otherwise expressly authorized by 
13 law;


14  (3) be actively involved in the affairs of any 
15 political party or
political organization; or

16  (4) advocate for the appointment of another person to 
17 an appointed or elected office or position or actively 
18 participate in any campaign for any
elective office.


19 In this subsection an appointed public office means a 
20position authorized by
law that is filled by an appointing 
21authority as provided by law and does not
include employment by 
22hiring in the ordinary course of business.


23 (e-1) No Executive Inspector General or employee of the 
24Office of the
Executive Inspector General may, for one year 
25after the termination of his or
her appointment or employment:


26  (1) become a candidate for any elective office;


 
 
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1  (2) hold any elected public office; or


2  (3) hold any appointed State, county, or local judicial 
3 office.


4 (e-2) The requirements of item (3) of subsection (e-1) may 
5be waived by the
Executive Ethics Commission.

6 (f) An Executive Inspector General may be removed only for 
7cause and may
be removed only by the appointing constitutional 
8officer. At the time of the
removal,
the appointing 
9constitutional officer must report to the Executive Ethics

10Commission the
justification for the
removal.

11(Source: P.A. 96-555, eff. 8-18-09; 96-1528, eff. 7-1-11.)

12 Section 90-5. The Alcoholism and Other Drug Abuse and 
13Dependency Act is amended by changing Section 5-20 as follows:




14 (20 ILCS 301/5-20)



15 Sec. 5-20. Compulsive gambling program. 

16 (a) Subject to appropriation, the Department shall 
17establish a program for
public education, research, and 
18training regarding problem and compulsive
gambling and the 
19treatment and prevention of problem and compulsive gambling.

20Subject to specific appropriation for these stated purposes, 
21the program must
include all of the following:


22  (1) Establishment and maintenance of a toll-free "800" 
23 telephone number
to provide crisis counseling and referral 
24 services to families experiencing
difficulty as a result of 
 
 
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1 problem or compulsive gambling.


2  (2) Promotion of public awareness regarding the 
3 recognition and
prevention of problem and compulsive 
4 gambling.


5  (3) Facilitation, through in-service training and 
6 other means, of the
availability of effective assistance 
7 programs for problem and compulsive
gamblers.


8  (4) Conducting studies to identify adults and 
9 juveniles in this
State who are, or who are at risk of 
10 becoming, problem or compulsive gamblers.

11 (b) Subject to appropriation, the Department shall either 
12establish and
maintain the program or contract with a private 
13or public entity for the
establishment and maintenance of the 
14program. Subject to appropriation, either
the Department or the 
15private or public entity shall implement the toll-free

16telephone number, promote public awareness, and conduct 
17in-service training
concerning problem and compulsive 
18gambling.

19 (c) Subject to appropriation, the Department shall produce 
20and supply the
signs specified in Section 10.7 of the Illinois 
21Lottery Law, Section 34.1 of
the Illinois Horse Racing Act of 
221975, Section 4.3 of the Bingo License and Tax
Act, Section 8.1 
23of the Charitable Games Act, and Section 13.1 of the Illinois 
24Riverboat
Gambling Act.

25(Source: P.A. 89-374, eff. 1-1-96; 89-626, eff. 8-9-96.)


 
 
09800SB1739sam001- 77 -LRB098 10559 AMC 42403 a


1 Section 90-8. The Illinois Lottery Law is amended by 
2changing Sections 2 and 9.1 and by adding Section 7.18 as 
3follows:



4 (20 ILCS 1605/2) (from Ch. 120, par. 1152)


5 Sec. 2. (a) This Act is enacted to implement and establish 
6within the State
a lottery to be conducted by the State through 
7the Department. The entire net proceeds of the Lottery
are to 
8be used for the support of the State's Common School Fund,

9except as provided in subsection (o) of Section 9.1 and 
10Sections 21.2, 21.5, 21.6, 21.7, and 21.8. The General Assembly 
11finds that it is in the public interest for the Department to 
12conduct the functions of the Lottery with the assistance of a 
13private manager under a management agreement overseen by the 
14Department. The Department shall be accountable to the General 
15Assembly and the people of the State through a comprehensive 
16system of regulation, audits, reports, and enduring 
17operational oversight. The Department's ongoing conduct of the 
18Lottery through a management agreement with a private manager 
19shall act to promote and ensure the integrity, security, 
20honesty, and fairness of the Lottery's operation and 
21administration. It is the intent of the General Assembly that 
22the Department shall conduct the Lottery with the assistance of 
23a private manager under a management agreement at all times in 
24a manner consistent with 18 U.S.C. 1307(a)(1), 1307(b)(1), 
251953(b)(4). 

 
 
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1 (b) It is further the intent of the General Assembly that 
2the Division of Internet Gaming of the Department shall 
3administer and regulate Internet wagering at all times in a 
4manner consistent with the applicable provisions of State and 
5federal law pursuant to Section 7.18 of this Law. 
6(Source: P.A. 95-331, eff. 8-21-07; 95-673, eff. 10-11-07; 
795-674, eff. 10-11-07; 95-876, eff. 8-21-08; 96-34, eff. 
87-13-09.)


9 (20 ILCS 1605/7.18 new)
10 Sec. 7.18. Internet gaming; Division of Internet Gaming; 
11powers.
12 (a) The General Assembly finds that the Internet has become 
13an integral part of everyday life for a significant number of 
14Illinois residents, not only in regards to their professional 
15life, but also in regards to personal business and 
16communication. Internet wagering on games of chance and games 
17of skill is a core form of entertainment for millions of 
18individuals worldwide. In multiple jurisdictions across the 
19world, Internet gaming is legal, regulated, and taxed, 
20generating billions of dollars in revenue for governments.
21 The General Assembly further finds that Illinois residents 
22participate in illegal on-line gambling on unregulated 
23Internet websites operated by offshore operators who are not 
24subject to regulation or taxation in the United States. Neither 
25federal nor Illinois laws provide sufficient consumer 
 
 
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1protections for Illinois residents who play games of chance or 
2skill on these illegal websites, nor does the State realize any 
3benefits from the revenues generated nor jobs created by 
4illegal on-line gaming.
5 In an opinion dated September 20, 2011, the United States 
6Department of Justice reversed its previous interpretation of 
7the federal Wire Act, 18 U.S.C. 1804, allowing states, subject 
8to certain restrictions, to legalize and regulate Internet 
9gaming and capture the revenue for the benefit of state 
10governments. The Department of Justice's opinion was prompted 
11in part by a request made by the Department pursuant to Public 
12Act 96-34. In order to protect Illinois residents who wager on 
13games of chance and skill through the Internet, and to capture 
14revenues and create jobs generated from Internet gaming, it is 
15in the best interest of the State and its citizens to regulate 
16this activity by authorizing and establishing a secure, 
17responsible, fair, and legal system of Internet gaming that 
18complies with the United States Department of Justice's 
19September 2011 opinion concerning the federal Wire Act.
20 The General Assembly additionally finds that pursuant to 
21the federal Unlawful Internet Gambling Enforcement Act of 2006 
22(UIGEA), 31 U.S.C. 5301, the provisions of this Section are 
23consistent and comply with the UIGEA and specifically authorize 
24use of the Internet to place, receive, or otherwise knowingly 
25transmit a bet or wager where Internet wagering complies with 
26this Section and rules adopted pursuant to this Section. 
 
 
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1 (b) As used in this Section: 
2 "Authorized participant" means a person who has a valid 
3Internet wagering account with an Internet gaming licensee and 
4is at least 21 years of age.
5 "Division" means the Division of Internet Gaming within the 
6Department of the Lottery.
7 "Fee-based game" means a game determined by the Division to 
8be a fee-based game, where the Internet gaming licensee charges 
9a fee, rake, or commission for operating the game.
10 "Gross fee-based gaming revenue" means the fee, rake, or 
11commission charged by the Internet gaming licensee for 
12operation of fee-based games.
13 "Gross gaming revenue" is the aggregate of gross fee-based 
14gaming revenue and gross non-fee-based gaming revenue.
15 "Gross non-fee-based gaming revenue" means the aggregate 
16of the amount of net wins received on all non-fee-based games. 
17 "Internet" means the international computer network of 
18interoperable packet-switched data networks, inclusive of such 
19additional technological platforms as mobile, satellite, and 
20other electronic distribution channels approved by the 
21Division. 
22 "Internet game" means a fee-based or non-fee-based game of 
23skill or chance that is offered by an Internet gaming licensee, 
24as authorized by the Division. "Internet game" also includes 
25gaming tournaments conducted via the Internet in which players 
26compete against one another in one or more of the games 
 
 
09800SB1739sam001- 81 -LRB098 10559 AMC 42403 a


1authorized in this definition or by the Division or in approved 
2variations or composites as authorized by the Division. 
3 "Internet gaming licensee" means a person, corporation, 
4partnership, or other entity receiving an Internet gaming 
5license from the Division to conduct Internet wagering.
6 "Internet gaming platform" means an interactive set of 
7related data networks controlled by an Internet gaming licensee 
8for the purpose of offering wagering on Internet games to 
9authorized participants.
10 "Internet gaming vendor" means any person, corporation, 
11partnership, or other entity that is certified by the Division 
12to provide or offer to provide goods, software, or services to 
13an Internet gaming licensee, including any goods, software, or 
14services related to or supporting: (i) the acceptance, testing, 
15auditing, management, operation, support, administration, or 
16control of Internet wagers, Internet games, Internet wagering 
17accounts, or Internet gaming platforms or (ii) the management, 
18operation, administration, or control of payment processing 
19systems. The Division shall have the sole and exclusive 
20jurisdiction to determine what persons, corporations, 
21partnerships, or other entities require certification pursuant 
22to this Act and the rules adopted pursuant to this Act. 
23Notwithstanding this definition, the licensing of trademarks, 
24names, likenesses, graphics, or other images, without more, 
25shall not render a licensor of such intellectual property an 
26Internet gaming vendor. 
 
 
09800SB1739sam001- 82 -LRB098 10559 AMC 42403 a


1 "Internet wagering" means the placing of wagers with an 
2Internet gaming licensee by persons who are either physically 
3present in Illinois when placing a wager or otherwise permitted 
4to place a wager by law. The intermediate routing of electronic 
5data in connection with Internet wagering (including across 
6state lines) shall not determine the location or locations in 
7which a wager is initiated, received, or otherwise made.
8 "Internet wagering account" means an electronic ledger 
9wherein the following types of transactions relative to the 
10Internet gaming platform are recorded: (i) deposits; (ii) 
11withdrawals; (iii) amounts wagered; (iv) amounts paid on 
12winning wagers; (v) service or other transaction-related 
13charges authorized by the patron, if any; (vi) adjustments to 
14the account; and (vii) any other information required by the 
15Division. 
16 "Net wins" means the amount of Internet wagers received by 
17the Internet gaming licensee on non-fee based games less the 
18amount paid by the Internet gaming licensee as winnings on that 
19non-fee based game.
20 "Non-fee-based game" means a game determined by the 
21Division to be a non-fee-based game, where (i) the player plays 
22against the Internet gaming licensee and (ii) the Internet 
23gaming licensee is banking the game and its bottom line is 
24affected by players' wins and losses. 
25 (c) Internet wagering, as defined in this Section, is 
26hereby authorized to the extent that it is carried out in 
 
 
09800SB1739sam001- 83 -LRB098 10559 AMC 42403 a


1accordance with the provisions of this Section. 
2 (d) The Division of Internet Gaming is established within 
3the Department of the Lottery and shall have all powers and 
4duties as specified in this Section and all other powers 
5necessary and proper to enable it to fully and effectively 
6execute the provisions of this Section for the purpose of 
7administering, regulating, and enforcing the system of 
8Internet gaming established by this Section. The Division of 
9Internet Gaming's jurisdiction shall extend under this Section 
10to every person, corporation, partnership, or other entity 
11involved in Internet gaming operations. To the extent 
12consistent with the provisions of this Section, the Division 
13shall be subject to and governed by provisions of this Article 
14and all of the laws and rules applicable to the Department. The 
15Division shall not be subject to any private management 
16agreement established pursuant to Section 9.1 of this Act. The 
17Division of Internet Gaming is also authorized to enter into 
18agreements with other gaming entities, including foreign 
19entities, for the purpose of facilitating, administering, and 
20regulating multijurisdiction Internet gaming to the extent 
21consistent with State and federal laws and the laws of any 
22foreign jurisdiction, if such jurisdiction is a party to the 
23multijurisdictional agreement. The Division shall not 
24authorize, administer, or otherwise maintain a system for 
25offering wagering on any amateur or professional sporting event 
26or contest, unless doing so is consistent with State and 
 
 
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1federal laws. Further, notwithstanding any other provision of 
2this Section, wagers may be accepted from persons who are not 
3physically present in this State if the Division determines 
4that such wagering is not inconsistent with federal law or the 
5law of the jurisdiction, including any foreign nation, in which 
6any such person is located, or such wagering is conducted 
7pursuant to a multijurisdictional agreement that is not 
8inconsistent with federal law to which this State is a party. 
9The Division shall be funded with moneys appropriated to the 
10Department of the Lottery.
11 (e) The Division of Internet Gaming is authorized to issue 
12Internet gaming licenses to persons, firms, partnerships, or 
13corporations that apply for such licensure upon a determination 
14by the Division that the applicant is eligible for an Internet 
15gaming license pursuant to this Section and rules adopted by 
16the Division. An Internet gaming license issued pursuant to 
17this Section shall be valid for a period of 5 years after the 
18date of issuance and shall be renewable thereafter for an 
19additional 5 years based on a determination by the Division 
20that the licensee continues to meet all the requirements of 
21this Section and the Division's rules. Notwithstanding any 
22other law to the contrary, any assignment or transfer of an 
23interest in an Internet gaming license, or a greater than 10% 
24interest (direct or indirect) in any entity holding such a 
25license, is subject to the written approval by the Division. 
26Approved transferees are subject to a $250,000 non-refundable 
 
 
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1application fee. Eligibility for application for an Internet 
2gaming license shall be limited to the following: (i) any 
3person or entity that holds a valid and unrevoked owners 
4license issued pursuant to the Illinois Gambling Act; (ii) any 
5person or entity that holds a valid and unrevoked electronic 
6gaming license issued pursuant to the Illinois Gambling Act; 
7and (iii) any person or entity that holds a valid and unrevoked 
8advance deposit wagering license issued pursuant to the 
9Illinois Horse Racing Act of 1975. No Internet gaming license 
10shall be granted to any applicant who has accepted wagers via 
11the Internet in contravention of this Section or United States 
12law in the 10 years preceding the application date.
13 A qualified applicant may apply to the Division for an 
14Internet gaming license to offer wagering on Internet games as 
15provided in this Act. The application shall be made on forms 
16provided by the Division and shall contain such information as 
17the Division prescribes, including, but not limited to, 
18detailed information regarding the ownership and management of 
19the applicant, detailed personal information regarding the 
20applicant, financial information regarding the applicant, and 
21the gaming history and experience of the applicant in the 
22United States and other jurisdictions. Each application shall 
23be accompanied by a non-refundable application fee of $250,000. 
24An incomplete application shall be cause for denial of a 
25license by the Division.
26 All information, records, interviews, reports, statements, 
 
 
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1memoranda, or other data supplied to or used by the Division in 
2the course of its review or investigation of an application for 
3an Internet gaming license or a renewal under this Section 
4shall be strictly confidential and used only for the purpose of 
5evaluating an applicant for a license or a renewal. 
6Notwithstanding any law to the contrary, such information is 
7not subject to the requirements of the Freedom of Information 
8Act.
9 Any person, association, corporation, partnership, or 
10entity who (i) knowingly makes materially false statements in 
11order to obtain an Internet gaming license; (ii) knowingly 
12advertises within the State of Illinois any game, product, or 
13feature that is not authorized by his or her license; or (iii) 
14violates any other provision of this Section, or any rule 
15adopted pursuant to this Section, is guilty of a Class B 
16misdemeanor. A person, association, corporation, partnership, 
17or entity who commits a second or subsequent violation commits 
18a Class A misdemeanor. In the case of an association, 
19corporation, partnership, or entity, imprisonment may be 
20imposed upon its officers who knowingly participated in the 
21violation.
22 An application shall be filed and considered in accordance 
23with the rules of the Division. The Division shall adopt rules 
24to effectuate the provisions of this subsection (e) within 30 
25days after the effective date of this amendatory Act of the 
2698th General Assembly.
 
 
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1 A license fee of $20,000,000 shall be paid to the Division 
2by an Internet gaming licensee at the time of issuance of the 
3license. All application and license fees shall be deposited 
4into the State Lottery Fund. The license fee imposed by this 
5subsection (e) shall constitute an advance payment of Internet 
6wagering taxes owed by the Internet gaming licensee pursuant to 
7subsection (m) of this Section.
8 (f) The Division is authorized to certify Internet gaming 
9vendors to provide goods, software, or services to Internet 
10gaming licensees. Certification by the Division of an Internet 
11gaming vendor shall be for a period of 5 years and shall be 
12renewable thereafter for an additional 5 years based on a 
13determination by the Division that the Internet gaming vendor 
14continues to meet all the requirements of this Section and the 
15Division's rules. 
16 A person, corporation, partnership, or other entity may 
17apply to the Division to become an Internet gaming vendor as 
18provided in this Act and the rules of the Division. The 
19application shall be made on forms provided by the Division and 
20shall contain such information as the Division prescribes, 
21including, but not limited to, detailed information regarding 
22the ownership and management of the applicant, detailed 
23personal information regarding the applicant, financial 
24information regarding the applicant, and the gaming history and 
25experience of the applicant in the United States and other 
26jurisdictions. Each application shall be accompanied by a 
 
 
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1non-refundable application fee, such application fee to be 
2determined by the Division, but shall not exceed $250,000. An 
3incomplete application shall be cause for denial of 
4certification. No certification shall be granted to an Internet 
5gaming vendor who has accepted wagers via the Internet in 
6contravention of this Act or in contravention of the any law of 
7the United States.
8 All information, records, interviews, reports, statements, 
9memoranda, or other data supplied to or used by the Division in 
10the course of its review or investigation of an application for 
11certification as an Internet gaming vendor shall be strictly 
12confidential and shall only be used for the purpose of 
13evaluating an applicant for a certification. Notwithstanding 
14any law to the contrary, such information is not subject to the 
15requirements of the Freedom of Information Act.
16 Any person, association, corporation, partnership, or 
17entity who (i) knowingly makes materially false statements in 
18order to obtain certification as an Internet gaming vendor or 
19(ii) violates any other provision of this Section, or any rule 
20adopted pursuant to this Section, is guilty of a Class B 
21misdemeanor. A person, association, corporation, partnership, 
22or entity who commits a second or subsequent violation commits 
23a Class A misdemeanor. In the case of an association, 
24corporation, partnership, or entity, imprisonment may be 
25imposed upon its officers who knowingly participated in the 
26violation. 
 
 
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1 (g) The Division shall have all the powers necessary or 
2desirable to effectuate the provisions of this Section, 
3including, but not limited to, the following powers:
4  (1) To develop qualifications, standards, and 
5 procedures for approval and licensure of Internet gaming 
6 licensees and certification of Internet gaming vendors. 
7  (2) To decide promptly and in reasonable order all 
8 license applications and to approve, deny, suspend, 
9 revoke, restrict, or refuse to renew Internet gaming 
10 licenses and Internet gaming vendor certifications. Any 
11 party aggrieved by an action of the Division denying, 
12 suspending, revoking, restricting, or refusing to renew a 
13 license may request a hearing before the Division. A 
14 request for hearing must be made to the Division in writing 
15 within 5 days after service of notice of the action by the 
16 Division. Notice of action by the Division shall be served 
17 either by personal delivery or by certified mail, postage 
18 prepaid, to the aggrieved party. Notice served by certified 
19 mail shall be deemed complete on the business day following 
20 the date of such mailing. The Division shall conduct all 
21 requested hearings promptly and in reasonable order.
22  (3) To conduct all hearings pertaining to civil 
23 violations of this Section or rules adopted pursuant to 
24 this Section. Such hearings shall be governed by Section 8 
25 of this Act. The Division shall further adopt hearing rules 
26 and procedures for conducting hearings pursuant to this 
 
 
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1 Section. In such hearings, reproduced copies of any of the 
2 Division's records relating to an Internet gaming licensee 
3 or Internet gaming vendor, including (i) any notices 
4 prepared in the Division's ordinary course of business and 
5 (ii) any books, records, or other documents offered in the 
6 name of the Division under certificate of the Executive 
7 Director, or any officer or employee of the Division 
8 designated in writing by the Executive Director, shall, 
9 without further proof, be admitted into evidence in any 
10 hearing before the hearing officers or any legal proceeding 
11 and shall be prima facie proof of the information contained 
12 therein. 
13  The Office of the Attorney General shall prosecute all 
14 criminal violations of this Section or rules adopted 
15 pursuant to this Section. 
16  (4) To provide for the establishment and collection of 
17 all license and certification fees and taxes imposed by 
18 this Section and the rules adopted pursuant to this 
19 Section. All such fees and taxes shall be deposited into 
20 the State Lottery Fund.
21  (5) To develop and enforce testing, audit, and 
22 certification requirements and schedules for Internet 
23 gaming platforms, Internet wagering, and Internet wagering 
24 accounts, including, without limitation, age and 
25 identification verification software, geolocation 
26 software, Internet games, and gaming hub software.
 
 
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1  (6) To develop and enforce requirements for 
2 responsible gaming and player protection, including 
3 privacy and confidentiality standards and duties.
4  (7) To develop and enforce requirements for accepting 
5 Internet wagers, Internet wagering accounts, and 
6 authorized participants and minimum insurance 
7 requirements.
8  (8) To develop and promote standards governing 
9 contracts between Internet gaming licensees and the 
10 payments industry.
11  (9) To develop and enforce standards and requirements 
12 regarding anti-fraud, anti-money laundering, and 
13 anti-collusion methods.
14  (10) To develop protocols related to the security of 
15 and disputes arising over Internet wagers and Internet 
16 wagering accounts.
17  (11) To be present through its inspectors and agents 
18 upon the premises of any location where Internet gaming 
19 operations are conducted by an Internet gaming licensee or 
20 where components of an Internet gaming licensee's Internet 
21 gaming platform are located, housed, or otherwise 
22 maintained.
23  (12) To adopt by rule a code of conduct governing 
24 Division employees that ensures, to the maximum extent 
25 possible, that persons subject to this Section avoid 
26 situations, relationships, or associations that may 
 
 
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1 represent or lead to an actual or perceived conflict of 
2 interest.
3  (13) To develop and administer civil penalties for 
4 Internet gaming licensees and Internet gaming vendors who 
5 violate this Section or the rules adopted pursuant to this 
6 Section.
7  (14) To audit and inspect, on reasonable notice, books 
8 and records relevant to Internet gaming operations, 
9 Internet wagers, Internet wagering accounts, Internet 
10 games, or Internet gaming platforms, including without 
11 limitation, those books and records regarding financing or 
12 accounting, marketing or operational materials, or any 
13 other such materials held by or in the custody of any 
14 Internet gaming licensee or Internet gaming vendor. The 
15 Division may assert such authority by administrative 
16 subpoena, which may further set forth relevant document 
17 requests and interrogatories, and which shall be 
18 enforceable in the Circuit Court of Cook County in the 
19 State of Illinois.
20  (15) To determine whether an Internet game is a 
21 fee-based game or non-fee-based game. 
22  (16) To acquire or lease real property and make 
23 improvements thereon and acquire by lease or by purchase 
24 personal property, including, but not limited to:
25   (A) computers hardware;
26   (B) mechanical, electronic, and online equipment 
 
 
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1 and terminals; and
2   (C) intangible property, including, but not 
3 limited to, computer programs, software, and systems. 
4 (h) The Division shall adopt and enforce such rules 
5governing the administration and conduct of Internet gaming as 
6it deems necessary to carry out the purpose of this Section. 
7These rules shall be subject to the provisions of the Illinois 
8Administrative Procedure Act and may include, but shall not be 
9limited to:
10  (1) the types of Internet games to be offered;
11  (2) price points for Internet games;
12  (3) player fees and percentage of rake commission or 
13 other fee for Internet games;
14  (4) forms of payment accepted for Internet games;
15  (5) the number, type, and amount of prizes for Internet 
16 games;
17  (6) the method of selecting winners and validating 
18 winnings;
19  (7) the frequency of Internet games;
20  (8) responsible gaming;
21  (9) technical and financial standards for Internet 
22 wagering, Internet wagering accounts, and Internet gaming 
23 platforms, systems, and software or other electronic 
24 components for Internet gaming; 
25  (10) such other matters necessary or desirable for the 
26 efficient and economical operation and administration of 
 
 
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1 Internet gaming and for the convenience of authorized 
2 Internet gaming participants and Internet gaming licensees 
3 and certified Internet gaming vendors.
4 (i) Notwithstanding any law to the contrary, the 
5Superintendent of the Lottery shall hire an Executive Director 
6who shall be responsible to the Superintendent and shall serve 
7subject only to removal by the Superintendent for incompetence, 
8neglect of duty, or malfeasance in office. The Executive 
9Director shall be responsible for the supervision and direction 
10of the Division staff and for the necessary administrative 
11activities of the Division, subject only to the direction and 
12approval of the Superintendent notwithstanding any law to the 
13contrary.
14 Notwithstanding any law to the contrary, the Executive 
15Director shall hire and employ employees as may be necessary to 
16carry out the provisions of this Law or to perform the duties 
17and exercise the powers conferred by law upon the Division. All 
18employees of the Division shall receive the compensation fixed 
19by the Executive Director, subject only to the Superintendent. 
20The Superintendent, Executive Director, and Division employees 
21shall be reimbursed for all actual and necessary traveling and 
22other expenses and disbursements necessarily incurred or made 
23by them in the discharge of their official duties. The 
24Superintendent and Executive Director may also incur necessary 
25expenses for office space, furniture, stationery, printing, 
26operations, and other incidental expenses.
 
 
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1 The Executive Director shall report monthly to the 
2Superintendent and the Lottery Control Board a full and 
3complete statement of Internet gaming revenues, other expenses 
4for each month, and the amounts to be transferred to the State 
5Lottery Fund pursuant to this Section. The Executive Director 
6shall also make an annual report, which shall include a full 
7and complete statement of Internet gaming revenues and other 
8expenses, to the Superintendent, the Governor, and the Board. 
9All reports required by this subsection shall be public and 
10copies of all such reports shall be sent to the Speaker of the 
11House of Representatives, the President of the Senate, the 
12Minority Leader of the House of Representatives, and the 
13Minority Leader of the Senate.
14 Subject to appropriation, the Executive Director shall 
15continue to apprise himself or herself as to: (i) the operation 
16and the administration of similar Internet gaming laws that may 
17be in effect in other states or countries; (ii) any relevant 
18literature on Internet gaming that from time to time may be 
19published or available; (iii) any federal laws and regulations 
20that may affect the operation of Internet gaming; and (iv) the 
21reaction of Illinois citizens to existing and potential 
22features of Internet gaming with a view to recommending or 
23effecting changes that will tend to serve the purposes of this 
24Section.
25 (j) An Internet gaming licensee's Internet gaming platform 
26shall provide one or more mechanisms to reasonably verify that 
 
 
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1a participant is 21 years of age or older and that wagering on 
2Internet games is limited to transactions that are initiated 
3and received or otherwise made exclusively within the State of 
4Illinois. A participant must satisfy the verification 
5requirements before he or she may establish an Internet gaming 
6account and wager on Internet games offered by Internet gaming 
7licensees. Further, all servers on which any Internet games are 
8operated and conducted (and all underlying material 
9technology) shall be located in the State of Illinois, unless 
10the Division has otherwise authorized another location. At such 
11a time that a legally compliant mechanism is established to 
12permit wagering on Internet games by individuals physically 
13located outside of the State, the Division may adopt rules and 
14procedures to allow and govern wagering by those individuals 
15and shall have the authority to enter into multijurisdictional 
16agreements and related and ancillary agreements in order to 
17effectuate such wagering. An Internet gaming licensee's 
18Internet gaming platform shall also provide mechanisms 
19designed to detect and prevent the unauthorized use of Internet 
20wagering accounts and to detect and prevent fraud, money 
21laundering, and collusion. If any participant in Internet 
22gaming violates any provisions of this Section or rule adopted 
23by the Division, then the participant's winnings shall be 
24forfeited. Any forfeited winnings shall be deposited into the 
25State Lottery Fund.
26 The following persons shall not be authorized to establish 
 
 
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1Internet gaming accounts or wager on Internet games offered by 
2Internet gaming licensees, except where required and 
3authorized by the Division for testing purposes or to otherwise 
4fulfill the purposes set forth in this Act: (i) any minor under 
521 years of age; (ii) any current member of the Lottery Control 
6Board; (iii) any current officer or other person employed by 
7the Department of the Lottery, the Division of Internet Gaming, 
8the Illinois Racing Board, or the Illinois Gaming Board; (iv) 
9any spouse, civil union partner, child, brother, sister, or 
10parent residing as a member of the same household in the 
11principal place of abode of any persons identified in (ii) or 
12(iii); and (iv) any individual whose name appears in the 
13Division's responsible gaming database.
14 (k) The Division shall develop responsible gaming 
15measures, including a statewide responsible gaming database 
16identifying individuals who shall be prohibited from 
17establishing an Internet wagering account or participating in 
18Internet gaming offered by an Internet gaming licensee. The 
19Executive Director may place a person on the responsible gaming 
20database if that person (i) has been convicted in any 
21jurisdiction of a felony, any crime of moral turpitude, or a 
22crime involving gaming; (ii) has violated this Act, the 
23Illinois Horse Racing Act of 1975, the Riverboat Gambling Act, 
24the Raffles Act, the Illinois Pull Tabs and Jar Games Act, the 
25Bingo License and Tax Act, the Charitable Games Act, or the 
26Video Gaming Act; (iii) has performed any act or had a 
 
 
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1notorious or unsavory reputation that would adversely affect 
2public confidence and trust in gaming; or (iv) has his or her 
3name on any valid and current exclusion list from another 
4jurisdiction in the United States or foreign jurisdiction. By 
5rule, the Division shall adopt procedures for the establishment 
6and maintenance of the responsible gaming database. The 
7Illinois Gaming Board, the Illinois Racing Board, and the 
8Department of the Lottery shall, in a format specified by the 
9Division, provide the Division with names of individuals to be 
10included in the responsible gaming database. The Division may 
11impose reasonable fees on persons authorized to access and use 
12the responsible gaming database.
13 An Internet gaming licensee's Internet gaming platform 
14shall offer in a clear, conspicuous, and accessible manner, 
15responsible gambling services and technical controls to 
16participants, including both temporary and permanent 
17self-exclusion for all games offered; the ability for 
18participants to establish their own periodic deposit and 
19wagering limits and maximum playing times; referrals to crisis 
20counseling and referral services for individuals and families 
21experiencing difficulty as a result of problem or compulsive 
22gambling; and other services as the Division reasonably may 
23determine are necessary or appropriate to reduce and prevent 
24problem gambling. Any authorized participant who is allowed to 
25participate in Internet gaming may voluntarily prohibit 
26themselves from establishing an Internet gaming account. The 
 
 
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1Division shall incorporate the voluntary self-exclusion list 
2into the responsible gaming database and maintain both the 
3self-exclusion list and the responsible gaming database in a 
4confidential manner. Notwithstanding any law to the contrary, 
5the self-exclusion list and responsible gaming database are not 
6public records subject to copying and disclosure under the 
7Freedom of Information Act.
8 (l) There is created the Responsible Internet Gaming 
9Advisory Board, consisting of the following members:
10  (1) the Superintendent of the Lottery, who shall be an 
11 ex officio member and shall serve as Chairperson;
12  (2) the Executive Director of the Division of Internet 
13 Gaming, who shall be an ex officio member;
14  (3) one representative from a national organization 
15 dedicated to the study and prevention of problem gambling, 
16 appointed by the Superintendent;
17  (4) one member who is an academic professional engaged 
18 in the study of problem gambling at a university or other 
19 institution of higher learning, appointed by the 
20 Superintendent;
21  (5) one member who has professional experience and 
22 expertise in the field of technical and systemic controls 
23 for responsible Internet gaming, appointed by the 
24 Superintendent; and
25  (6) one member who is an Illinois citizen and a member 
26 of the public, appointed by the Superintendent.
 
 
09800SB1739sam001- 100 -LRB098 10559 AMC 42403 a


1 Each Advisory Board member shall serve for a term of 4 
2years and until his or her successor is appointed and 
3qualified. However, in making initial appointments, 2 shall be 
4appointed to serve for 2 years and 2 shall be appointed to 
5serve for 4 years. Appointments to fill vacancies shall be made 
6in the same manner as original appointments for the unexpired 
7portion of the vacated term. Initial terms shall begin on the 
8effective date of this amendatory Act of the 98th General 
9Assembly. Each member of the Advisory Board shall be eligible 
10for reappointment at the discretion of the Superintendent.
A 
11member of the Advisory Board may be removed from office for 
12just cause. Advisory Board members shall receive no 
13compensation, but shall be reimbursed for expenses incurred in 
14connection with their duties as Advisory Board members.
15 Four members shall constitute a quorum. A majority vote of 
16the Advisory Board is required for an Advisory Board decision. 
17The Advisory Board shall meet no less often than once every 6 
18months and shall meet as often as the Chairperson deems 
19necessary. Advisory Board members shall not be liable for any 
20of their acts, omissions, decisions, or any other conduct in 
21connection with their duties on the Advisory Board, except 
22those involving willful, wanton, or intentional misconduct.
23 The Advisory Board shall make recommendations to the 
24Executive Director regarding the development of rules and 
25procedures to reduce and prevent problem or compulsive gambling 
26and youth gambling and to ensure the conduct of safe, fair, and 
 
 
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1responsible Internet gaming. The Advisory Board may have such 
2powers as may be granted by the Executive Director to carry out 
3the provisions of this Section regarding responsible Internet 
4gaming. 
5 (m) A tax is hereby imposed on Internet gaming licensees, 
6based on the gross gaming revenue received by an Internet 
7gaming licensee from Internet games authorized pursuant to this 
8Section, at the following rates:
9  (1) for all non-fee-based games, the tax shall be 20% 
10 of annual gross non-fee-based gaming revenue; and
11  (2) for all fee-based games the tax shall be 15% of 
12 annual gross fee-based gaming revenue.
13 The taxes imposed by this subsection (m) shall be paid by 
14the Internet gaming licensee to the Division no later than 5:00 
15p.m. on the day after the day when the wagers were made.
16 In recognition of the advance tax revenue paid by the 
17Internet gaming licensee in its license fee, an Internet gaming 
18licensee shall be taxed at the following rates during the 
19initial 5-year license term:
20  (1) for all non-fee-based games, the tax shall be 10% 
21 of annual gross non-fee-based gaming revenue up to and 
22 including $200,000,000 of gross gaming revenue and 20% of 
23 annual gross non-fee-based gaming revenue in excess 
24 $200,000,000 of gross gaming revenue; and
25  (2) for all fee-based games, the tax shall be 7.5% of 
26 annual gross fee-based gaming revenue up to and including 
 
 
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1 $200,000,000 of gross gaming revenue and 15% of annual 
2 gross fee-based gaming revenue in excess $200,000,000 of 
3 gross gaming revenue.
4 (n) Beginning on the effective date of this amendatory Act 
5of the 98th General Assembly, from the tax revenue deposited in 
6the State Lottery Fund under this Section, $10,000,000 shall be 
7paid annually to the Department of Human Services for the 
8administration of programs to treat problem gambling.
9 (o) Beginning on the effective date of this amendatory Act 
10of the 98th General Assembly, from the tax revenue deposited in 
11the State Lottery Fund under this Section, $5,000,000 shall be 
12transferred into the State Fairgrounds Capital Improvements 
13Fund annually.
14 (p) Beginning on the effective date of this amendatory Act 
15of the 98th General Assembly, after the amounts specified in 
16subsections (n) and (o) have been paid or transferred, all 
17remaining tax revenue deposited in the State Lottery Fund 
18pursuant to this Section shall be transferred to the Pension 
19Stabilization Fund. 

20 (20 ILCS 1605/9.1)
21 Sec. 9.1. Private manager and management agreement.
22 (a) As used in this Section:
23 "Offeror" means a person or group of persons that responds 
24to a request for qualifications under this Section.
25 "Request for qualifications" means all materials and 
 
 
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1documents prepared by the Department to solicit the following 
2from offerors:
3  (1) Statements of qualifications.
4  (2) Proposals to enter into a management agreement, 
5 including the identity of any prospective vendor or vendors 
6 that the offeror intends to initially engage to assist the 
7 offeror in performing its obligations under the management 
8 agreement.
9 "Final offer" means the last proposal submitted by an 
10offeror in response to the request for qualifications, 
11including the identity of any prospective vendor or vendors 
12that the offeror intends to initially engage to assist the 
13offeror in performing its obligations under the management 
14agreement. 
15 "Final offeror" means the offeror ultimately selected by 
16the Governor to be the private manager for the Lottery under 
17subsection (h) of this Section.
18 (b) By September 15, 2010, the Governor shall select a 
19private manager for the total management of the Lottery with 
20integrated functions, such as lottery game design, supply of 
21goods and services, and advertising and as specified in this 
22Section.
23 (c) Pursuant to the terms of this subsection, the 
24Department shall endeavor to expeditiously terminate the 
25existing contracts in support of the Lottery in effect on the 
26effective date of this amendatory Act of the 96th General 
 
 
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1Assembly in connection with the selection of the private 
2manager. As part of its obligation to terminate these contracts 
3and select the private manager, the Department shall establish 
4a mutually agreeable timetable to transfer the functions of 
5existing contractors to the private manager so that existing 
6Lottery operations are not materially diminished or impaired 
7during the transition. To that end, the Department shall do the 
8following:
9  (1) where such contracts contain a provision 
10 authorizing termination upon notice, the Department shall 
11 provide notice of termination to occur upon the mutually 
12 agreed timetable for transfer of functions;
13  (2) upon the expiration of any initial term or renewal 
14 term of the current Lottery contracts, the Department shall 
15 not renew such contract for a term extending beyond the 
16 mutually agreed timetable for transfer of functions; or
17  (3) in the event any current contract provides for 
18 termination of that contract upon the implementation of a 
19 contract with the private manager, the Department shall 
20 perform all necessary actions to terminate the contract on 
21 the date that coincides with the mutually agreed timetable 
22 for transfer of functions.
23 If the contracts to support the current operation of the 
24Lottery in effect on the effective date of this amendatory Act 
25of the 96th General Assembly are not subject to termination as 
26provided for in this subsection (c), then the Department may 
 
 
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1include a provision in the contract with the private manager 
2specifying a mutually agreeable methodology for incorporation.
3 (c-5) The Department shall include provisions in the 
4management agreement whereby the private manager shall, for a 
5fee, and pursuant to a contract negotiated with the Department 
6(the "Employee Use Contract"), utilize the services of current 
7Department employees to assist in the administration and 
8operation of the Lottery. The Department shall be the employer 
9of all such bargaining unit employees assigned to perform such 
10work for the private manager, and such employees shall be State 
11employees, as defined by the Personnel Code. Department 
12employees shall operate under the same employment policies, 
13rules, regulations, and procedures, as other employees of the 
14Department. In addition, neither historical representation 
15rights under the Illinois Public Labor Relations Act, nor 
16existing collective bargaining agreements, shall be disturbed 
17by the management agreement with the private manager for the 
18management of the Lottery. 
19 (d) The management agreement with the private manager shall 
20include all of the following:
21  (1) A term not to exceed 10 years, including any 
22 renewals.
23  (2) A provision specifying that the Department:
24   (A) shall exercise actual control over all 
25 significant business decisions; 
26   (A-5) has the authority to direct or countermand 
 
 
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1 operating decisions by the private manager at any time;
2   (B) has ready access at any time to information 
3 regarding Lottery operations;
4   (C) has the right to demand and receive information 
5 from the private manager concerning any aspect of the 
6 Lottery operations at any time; and
7   (D) retains ownership of all trade names, 
8 trademarks, and intellectual property associated with 
9 the Lottery.
10  (3) A provision imposing an affirmative duty on the 
11 private manager to provide the Department with material 
12 information and with any information the private manager 
13 reasonably believes the Department would want to know to 
14 enable the Department to conduct the Lottery.
15  (4) A provision requiring the private manager to 
16 provide the Department with advance notice of any operating 
17 decision that bears significantly on the public interest, 
18 including, but not limited to, decisions on the kinds of 
19 games to be offered to the public and decisions affecting 
20 the relative risk and reward of the games being offered, so 
21 the Department has a reasonable opportunity to evaluate and 
22 countermand that decision.
23  (5) A provision providing for compensation of the 
24 private manager that may consist of, among other things, a 
25 fee for services and a performance based bonus as 
26 consideration for managing the Lottery, including terms 
 
 
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1 that may provide the private manager with an increase in 
2 compensation if Lottery revenues grow by a specified 
3 percentage in a given year.
4  (6) (Blank).
5  (7) A provision requiring the deposit of all Lottery 
6 proceeds to be deposited into the State Lottery Fund except 
7 as otherwise provided in Section 20 of this Act.
8  (8) A provision requiring the private manager to locate 
9 its principal office within the State.
10  (8-5) A provision encouraging that at least 20% of the 
11 cost of contracts entered into for goods and services by 
12 the private manager in connection with its management of 
13 the Lottery, other than contracts with sales agents or 
14 technical advisors, be awarded to businesses that are a 
15 minority owned business, a female owned business, or a 
16 business owned by a person with disability, as those terms 
17 are defined in the Business Enterprise for Minorities, 
18 Females, and Persons with Disabilities Act. 
19  (9) A requirement that so long as the private manager 
20 complies with all the conditions of the agreement under the 
21 oversight of the Department, the private manager shall have 
22 the following duties and obligations with respect to the 
23 management of the Lottery:
24   (A) The right to use equipment and other assets 
25 used in the operation of the Lottery.
26   (B) The rights and obligations under contracts 
 
 
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1 with retailers and vendors.
2   (C) The implementation of a comprehensive security 
3 program by the private manager.
4   (D) The implementation of a comprehensive system 
5 of internal audits.
6   (E) The implementation of a program by the private 
7 manager to curb compulsive gambling by persons playing 
8 the Lottery.
9   (F) A system for determining (i) the type of 
10 Lottery games, (ii) the method of selecting winning 
11 tickets, (iii) the manner of payment of prizes to 
12 holders of winning tickets, (iv) the frequency of 
13 drawings of winning tickets, (v) the method to be used 
14 in selling tickets, (vi) a system for verifying the 
15 validity of tickets claimed to be winning tickets, 
16 (vii) the basis upon which retailer commissions are 
17 established by the manager, and (viii) minimum 
18 payouts.
19  (10) A requirement that advertising and promotion must 
20 be consistent with Section 7.8a of this Act.
21  (11) A requirement that the private manager market the 
22 Lottery to those residents who are new, infrequent, or 
23 lapsed players of the Lottery, especially those who are 
24 most likely to make regular purchases on the Internet as 
25 permitted by law.
26  (12) A code of ethics for the private manager's 
 
 
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1 officers and employees.
2  (13) A requirement that the Department monitor and 
3 oversee the private manager's practices and take action 
4 that the Department considers appropriate to ensure that 
5 the private manager is in compliance with the terms of the 
6 management agreement, while allowing the manager, unless 
7 specifically prohibited by law or the management 
8 agreement, to negotiate and sign its own contracts with 
9 vendors.
10  (14) A provision requiring the private manager to 
11 periodically file, at least on an annual basis, appropriate 
12 financial statements in a form and manner acceptable to the 
13 Department.
14  (15) Cash reserves requirements.
15  (16) Procedural requirements for obtaining the prior 
16 approval of the Department when a management agreement or 
17 an interest in a management agreement is sold, assigned, 
18 transferred, or pledged as collateral to secure financing.
19  (17) Grounds for the termination of the management 
20 agreement by the Department or the private manager.
21  (18) Procedures for amendment of the agreement.
22  (19) A provision requiring the private manager to 
23 engage in an open and competitive bidding process for any 
24 procurement having a cost in excess of $50,000 that is not 
25 a part of the private manager's final offer. The process 
26 shall favor the selection of a vendor deemed to have 
 
 
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1 submitted a proposal that provides the Lottery with the 
2 best overall value. The process shall not be subject to the 
3 provisions of the Illinois Procurement Code, unless 
4 specifically required by the management agreement.
5  (20) The transition of rights and obligations, 
6 including any associated equipment or other assets used in 
7 the operation of the Lottery, from the manager to any 
8 successor manager of the lottery, including the 
9 Department, following the termination of or foreclosure 
10 upon the management agreement.
11  (21) Right of use of copyrights, trademarks, and 
12 service marks held by the Department in the name of the 
13 State. The agreement must provide that any use of them by 
14 the manager shall only be for the purpose of fulfilling its 
15 obligations under the management agreement during the term 
16 of the agreement.
17  (22) The disclosure of any information requested by the 
18 Department to enable it to comply with the reporting 
19 requirements and information requests provided for under 
20 subsection (p) of this Section. 
21 (e) Notwithstanding any other law to the contrary, the 
22Department shall select a private manager through a competitive 
23request for qualifications process consistent with Section 
2420-35 of the Illinois Procurement Code, which shall take into 
25account:
26  (1) the offeror's ability to market the Lottery to 
 
 
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1 those residents who are new, infrequent, or lapsed players 
2 of the Lottery, especially those who are most likely to 
3 make regular purchases on the Internet;
4  (2) the offeror's ability to address the State's 
5 concern with the social effects of gambling on those who 
6 can least afford to do so;
7  (3) the offeror's ability to provide the most 
8 successful management of the Lottery for the benefit of the 
9 people of the State based on current and past business 
10 practices or plans of the offeror; and
11  (4) the offeror's poor or inadequate past performance 
12 in servicing, equipping, operating or managing a lottery on 
13 behalf of Illinois, another State or foreign government and 
14 attracting persons who are not currently regular players of 
15 a lottery.
16 (f) The Department may retain the services of an advisor or 
17advisors with significant experience in financial services or 
18the management, operation, and procurement of goods, services, 
19and equipment for a government-run lottery to assist in the 
20preparation of the terms of the request for qualifications and 
21selection of the private manager. Any prospective advisor 
22seeking to provide services under this subsection (f) shall 
23disclose any material business or financial relationship 
24during the past 3 years with any potential offeror, or with a 
25contractor or subcontractor presently providing goods, 
26services, or equipment to the Department to support the 
 
 
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1Lottery. The Department shall evaluate the material business or 
2financial relationship of each prospective advisor. The 
3Department shall not select any prospective advisor with a 
4substantial business or financial relationship that the 
5Department deems to impair the objectivity of the services to 
6be provided by the prospective advisor. During the course of 
7the advisor's engagement by the Department, and for a period of 
8one year thereafter, the advisor shall not enter into any 
9business or financial relationship with any offeror or any 
10vendor identified to assist an offeror in performing its 
11obligations under the management agreement. Any advisor 
12retained by the Department shall be disqualified from being an 
13offeror.
The Department shall not include terms in the request 
14for qualifications that provide a material advantage whether 
15directly or indirectly to any potential offeror, or any 
16contractor or subcontractor presently providing goods, 
17services, or equipment to the Department to support the 
18Lottery, including terms contained in previous responses to 
19requests for proposals or qualifications submitted to 
20Illinois, another State or foreign government when those terms 
21are uniquely associated with a particular potential offeror, 
22contractor, or subcontractor. The request for proposals 
23offered by the Department on December 22, 2008 as 
24"LOT08GAMESYS" and reference number "22016176" is declared 
25void.
26 (g) The Department shall select at least 2 offerors as 
 
 
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1finalists to potentially serve as the private manager no later 
2than August 9, 2010. Upon making preliminary selections, the 
3Department shall schedule a public hearing on the finalists' 
4proposals and provide public notice of the hearing at least 7 
5calendar days before the hearing. The notice must include all 
6of the following:
7  (1) The date, time, and place of the hearing.
8  (2) The subject matter of the hearing.
9  (3) A brief description of the management agreement to 
10 be awarded.
11  (4) The identity of the offerors that have been 
12 selected as finalists to serve as the private manager.
13  (5) The address and telephone number of the Department.
14 (h) At the public hearing, the Department shall (i) provide 
15sufficient time for each finalist to present and explain its 
16proposal to the Department and the Governor or the Governor's 
17designee, including an opportunity to respond to questions 
18posed by the Department, Governor, or designee and (ii) allow 
19the public and non-selected offerors to comment on the 
20presentations. The Governor or a designee shall attend the 
21public hearing. After the public hearing, the Department shall 
22have 14 calendar days to recommend to the Governor whether a 
23management agreement should be entered into with a particular 
24finalist. After reviewing the Department's recommendation, the 
25Governor may accept or reject the Department's recommendation, 
26and shall select a final offeror as the private manager by 
 
 
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1publication of a notice in the Illinois Procurement Bulletin on 
2or before September 15, 2010. The Governor shall include in the 
3notice a detailed explanation and the reasons why the final 
4offeror is superior to other offerors and will provide 
5management services in a manner that best achieves the 
6objectives of this Section. The Governor shall also sign the 
7management agreement with the private manager.
8 (i) Any action to contest the private manager selected by 
9the Governor under this Section must be brought within 7 
10calendar days after the publication of the notice of the 
11designation of the private manager as provided in subsection 
12(h) of this Section.
13 (j) The Lottery shall remain, for so long as a private 
14manager manages the Lottery in accordance with provisions of 
15this Act, a Lottery conducted by the State, and the State shall 
16not be authorized to sell or transfer the Lottery to a third 
17party.
18 (k) Any tangible personal property used exclusively in 
19connection with the lottery that is owned by the Department and 
20leased to the private manager shall be owned by the Department 
21in the name of the State and shall be considered to be public 
22property devoted to an essential public and governmental 
23function.
24 (l) The Department may exercise any of its powers under 
25this Section or any other law as necessary or desirable for the 
26execution of the Department's powers under this Section.
 
 
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1 (m) Neither this Section nor any management agreement 
2entered into under this Section prohibits the General Assembly 
3from authorizing forms of gambling that are not in direct 
4competition with the Lottery. The forms of gambling authorized 
5by this amendatory Act of the 98th General Assembly constitute 
6authorized forms of gambling that are not in direct competition 
7with the Lottery.
8 (n) The private manager shall be subject to a complete 
9investigation in the third, seventh, and tenth years of the 
10agreement (if the agreement is for a 10-year term) by the 
11Department in cooperation with the Auditor General to determine 
12whether the private manager has complied with this Section and 
13the management agreement. The private manager shall bear the 
14cost of an investigation or reinvestigation of the private 
15manager under this subsection.
16 (o) The powers conferred by this Section are in addition 
17and supplemental to the powers conferred by any other law. If 
18any other law or rule is inconsistent with this Section, 
19including, but not limited to, provisions of the Illinois 
20Procurement Code, then this Section controls as to any 
21management agreement entered into under this Section. This 
22Section and any rules adopted under this Section contain full 
23and complete authority for a management agreement between the 
24Department and a private manager. No law, procedure, 
25proceeding, publication, notice, consent, approval, order, or 
26act by the Department or any other officer, Department, agency, 
 
 
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1or instrumentality of the State or any political subdivision is 
2required for the Department to enter into a management 
3agreement under this Section. This Section contains full and 
4complete authority for the Department to approve any contracts 
5entered into by a private manager with a vendor providing 
6goods, services, or both goods and services to the private 
7manager under the terms of the management agreement, including 
8subcontractors of such vendors.
9 Upon receipt of a written request from the Chief 
10Procurement Officer, the Department shall provide to the Chief 
11Procurement Officer a complete and un-redacted copy of the 
12management agreement or any contract that is subject to the 
13Department's approval authority under this subsection (o). The 
14Department shall provide a copy of the agreement or contract to 
15the Chief Procurement Officer in the time specified by the 
16Chief Procurement Officer in his or her written request, but no 
17later than 5 business days after the request is received by the 
18Department. The Chief Procurement Officer must retain any 
19portions of the management agreement or of any contract 
20designated by the Department as confidential, proprietary, or 
21trade secret information in complete confidence pursuant to 
22subsection (g) of Section 7 of the Freedom of Information Act. 
23The Department shall also provide the Chief Procurement Officer 
24with reasonable advance written notice of any contract that is 
25pending Department approval. 
26 Notwithstanding any other provision of this Section to the 
 
 
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1contrary, the Chief Procurement Officer shall adopt 
2administrative rules, including emergency rules, to establish 
3a procurement process to select a successor private manager if 
4a private management agreement has been terminated. The 
5selection process shall at a minimum take into account the 
6criteria set forth in items (1) through (4) of subsection (e) 
7of this Section and may include provisions consistent with 
8subsections (f), (g), (h), and (i) of this Section. The Chief 
9Procurement Officer shall also implement and administer the 
10adopted selection process upon the termination of a private 
11management agreement. The Department, after the Chief 
12Procurement Officer certifies that the procurement process has 
13been followed in accordance with the rules adopted under this 
14subsection (o), shall select a final offeror as the private 
15manager and sign the management agreement with the private 
16manager. 
17 Except as provided in Sections 21.2, 21.5, 21.6, 21.7, and 
1821.8, the Department shall distribute all proceeds of lottery 
19tickets and shares sold in the following priority and manner:
20  (1) The payment of prizes and retailer bonuses.
21  (2) The payment of costs incurred in the operation and 
22 administration of the Lottery, including the payment of 
23 sums due to the private manager under the management 
24 agreement with the Department.
25  (3) On the last day of each month or as soon thereafter 
26 as possible, the State Comptroller shall direct and the 
 
 
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1 State Treasurer shall transfer from the State Lottery Fund 
2 to the Common School Fund an amount that is equal to the 
3 proceeds transferred in the corresponding month of fiscal 
4 year 2009, as adjusted for inflation, to the Common School 
5 Fund.
6  (4) On or before the last day of each fiscal year, 
7 deposit any remaining proceeds, subject to payments under 
8 items (1), (2), and (3) into the Capital Projects Fund each 
9 fiscal year. 
10 (p) The Department shall be subject to the following 
11reporting and information request requirements:
12  (1) the Department shall submit written quarterly 
13 reports to the Governor and the General Assembly on the 
14 activities and actions of the private manager selected 
15 under this Section;
16  (2) upon request of the Chief Procurement Officer, the 
17 Department shall promptly produce information related to 
18 the procurement activities of the Department and the 
19 private manager requested by the Chief Procurement 
20 Officer; the Chief Procurement Officer must retain 
21 confidential, proprietary, or trade secret information 
22 designated by the Department in complete confidence 
23 pursuant to subsection (g) of Section 7 of the Freedom of 
24 Information Act; and
25  (3) at least 30 days prior to the beginning of the 
26 Department's fiscal year, the Department shall prepare an 
 
 
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1 annual written report on the activities of the private 
2 manager selected under this Section and deliver that report 
3 to the Governor and General Assembly.
4(Source: P.A. 96-34, eff. 7-13-09; 96-37, eff. 7-13-09; 96-840, 
5eff. 12-23-09; 97-464, eff. 8-19-11; revised 10-17-12.)

6 Section 90-10. The Department of Revenue Law of the
Civil 
7Administrative Code of Illinois is amended by changing Section 
82505-305 as follows:




9 (20 ILCS 2505/2505-305) (was 20 ILCS 2505/39b15.1)



10 Sec. 2505-305. Investigators. 

11 (a) The Department has the power to
appoint investigators 
12to conduct all investigations,
searches, seizures, arrests, 
13and other duties imposed under the provisions
of any law 
14administered by the Department.
Except as provided in 
15subsection (c), these investigators have
and
may exercise all 
16the powers of peace officers solely for the purpose of

17enforcing taxing measures administered by the Department.

18 (b) The Director must authorize to each investigator 
19employed under this
Section and
to any other employee of the 
20Department exercising the powers of a peace
officer a
distinct 
21badge that, on its face, (i) clearly states that the badge is

22authorized
by the
Department and (ii)
contains a unique 
23identifying number.
No other badge shall be authorized by
the 
24Department.

 
 
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1 (c) The Department may enter into agreements with the 
2Illinois Gaming Board providing that investigators appointed 
3under this Section shall exercise the peace officer powers set 
4forth in paragraph (20.6) of subsection (c) of Section 5 of the 
5Illinois Riverboat Gambling Act.


6(Source: P.A. 96-37, eff. 7-13-09.)



7 Section 90-12. The Illinois State Auditing Act is amended 
8by changing Section 3-1 as follows:




9 (30 ILCS 5/3-1) (from Ch. 15, par. 303-1)


10 Sec. 3-1. Jurisdiction of Auditor General. The Auditor 
11General has
jurisdiction over all State agencies to make post 
12audits and investigations
authorized by or under this Act or 
13the Constitution.

14 The Auditor General has jurisdiction over local government 
15agencies
and private agencies only:


16  (a) to make such post audits authorized by or under 
17 this Act as are
necessary and incidental to a post audit of 
18 a State agency or of a
program administered by a State 
19 agency involving public funds of the
State, but this 
20 jurisdiction does not include any authority to review
local 
21 governmental agencies in the obligation, receipt, 
22 expenditure or
use of public funds of the State that are 
23 granted without limitation or
condition imposed by law, 
24 other than the general limitation that such
funds be used 
 
 
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1 for public purposes;


2  (b) to make investigations authorized by or under this 
3 Act or the
Constitution; and


4  (c) to make audits of the records of local government 
5 agencies to verify
actual costs of state-mandated programs 
6 when directed to do so by the
Legislative Audit Commission 
7 at the request of the State Board of Appeals
under the 
8 State Mandates Act.

9 In addition to the foregoing, the Auditor General may 
10conduct an
audit of the Metropolitan Pier and Exposition 
11Authority, the
Regional Transportation Authority, the Suburban 
12Bus Division, the Commuter
Rail Division and the Chicago 
13Transit Authority and any other subsidized
carrier when 
14authorized by the Legislative Audit Commission. Such audit
may 
15be a financial, management or program audit, or any combination 
16thereof.

17 The audit shall determine whether they are operating in 
18accordance with
all applicable laws and regulations. Subject to 
19the limitations of this
Act, the Legislative Audit Commission 
20may by resolution specify additional
determinations to be 
21included in the scope of the audit.

22 In addition to the foregoing, the Auditor General must also 
23conduct a
financial audit of
the Illinois Sports Facilities 
24Authority's expenditures of public funds in
connection with the 
25reconstruction, renovation, remodeling, extension, or

26improvement of all or substantially all of any existing 
 
 
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1"facility", as that
term is defined in the Illinois Sports 
2Facilities Authority Act.

3 The Auditor General may also conduct an audit, when 
4authorized by
the Legislative Audit Commission, of any hospital 
5which receives 10% or
more of its gross revenues from payments 
6from the State of Illinois,
Department of Healthcare and Family 
7Services (formerly Department of Public Aid), Medical 
8Assistance Program.

9 The Auditor General is authorized to conduct financial and 
10compliance
audits of the Illinois Distance Learning Foundation 
11and the Illinois
Conservation Foundation.

12 As soon as practical after the effective date of this 
13amendatory Act of
1995, the Auditor General shall conduct a 
14compliance and management audit of
the City of
Chicago and any 
15other entity with regard to the operation of Chicago O'Hare

16International Airport, Chicago Midway Airport and Merrill C. 
17Meigs Field. The
audit shall include, but not be limited to, an 
18examination of revenues,
expenses, and transfers of funds; 
19purchasing and contracting policies and
practices; staffing 
20levels; and hiring practices and procedures. When
completed, 
21the audit required by this paragraph shall be distributed in

22accordance with Section 3-14.

23 The Auditor General shall conduct a financial and 
24compliance and program
audit of distributions from the 
25Municipal Economic Development Fund
during the immediately 
26preceding calendar year pursuant to Section 8-403.1 of
the 
 
 
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1Public Utilities Act at no cost to the city, village, or 
2incorporated town
that received the distributions.

3 The Auditor General must conduct an audit of the Health 
4Facilities and Services Review Board pursuant to Section 19.5 
5of the Illinois Health Facilities Planning
Act.

6 The Auditor General must conduct an audit of the Chicago 
7Casino Development Authority pursuant to Section 1-60 of the 
8Chicago Casino Development Authority Act. 
9 The Auditor General of the State of Illinois shall annually 
10conduct or
cause to be conducted a financial and compliance 
11audit of the books and records
of any county water commission 
12organized pursuant to the Water Commission Act
of 1985 and 
13shall file a copy of the report of that audit with the Governor 
14and
the Legislative Audit Commission. The filed audit shall be 
15open to the public
for inspection. The cost of the audit shall 
16be charged to the county water
commission in accordance with 
17Section 6z-27 of the State Finance Act. The
county water 
18commission shall make available to the Auditor General its 
19books
and records and any other documentation, whether in the 
20possession of its
trustees or other parties, necessary to 
21conduct the audit required. These
audit requirements apply only 
22through July 1, 2007.

23 The Auditor General must conduct audits of the Rend Lake 
24Conservancy
District as provided in Section 25.5 of the River 
25Conservancy Districts Act.

26 The Auditor General must conduct financial audits of the 
 
 
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1Southeastern Illinois Economic Development Authority as 
2provided in Section 70 of the Southeastern Illinois Economic 
3Development Authority Act.

4 The Auditor General shall conduct a compliance audit in 
5accordance with subsections (d) and (f) of Section 30 of the 
6Innovation Development and Economy Act. 
7(Source: P.A. 95-331, eff. 8-21-07; 96-31, eff. 6-30-09; 
896-939, eff. 6-24-10.)


9 Section 90-15. The State Finance Act is amended by adding 
10Sections 5.826, 5.829, 6z-98, and 6z-99 as follows:

11 (30 ILCS 105/5.826 new)
12 Sec. 5.826. The Gaming Facilities Fee Revenue Fund.

13 (30 ILCS 105/5.829 new)
14 Sec. 5.829. The State Fairgrounds Capital Improvement 
15Fund.

16 (30 ILCS 105/6z-98 new)
17 Sec. 6z-98. The Gaming Facilities Fee Revenue Fund.
18 (a) The Gaming Facilities Fee Revenue Fund is created as a 
19special fund in the State treasury.
20 (b) The revenues in the Fund shall be used, subject to 
21appropriation, by the Comptroller for the purpose of (i) 
22providing appropriations to the Illinois Gaming Board for the 
 
 
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1administration and enforcement of the Illinois Gambling Act and 
2the applicable provisions of the Chicago Casino Development 
3Authority Act and (ii) payment of vouchers that are outstanding 
4for more than 60 days. Whenever practical, the Comptroller must 
5prioritize voucher payments for expenses related to medical 
6assistance under the Illinois Public Aid Code, the Children's 
7Health Insurance Program Act, the Covering ALL KIDS Health 
8Insurance Act, and the Senior Citizens and Disabled Persons 
9Property Tax Relief and Pharmaceutical Assistance Act.
10 (c) The Fund shall consist of fee revenues received 
11pursuant to subsection (e) of Section 1-45 of the Chicago 
12Casino Development Authority Act and pursuant to subsections 
13(e-10), (e-15), (e-25), and (h-5) of Section 7 and subsections 
14(c) and (i) of Section 7.6 of the Illinois Gambling Act. All 
15interest earned on moneys in the Fund shall be deposited into 
16the Fund.
17 (d) The Fund shall not be subject to administrative charges 
18or chargebacks, including, but not limited to, those authorized 
19under subsection (h) of Section 8 of this Act. 

20 (30 ILCS 105/6z-99 new)
21 Sec. 6z-99. The State Fairgrounds Capital Improvement 
22Fund. There is created the State Fairgrounds
Capital 
23Improvement Fund, a special fund in the State treasury. Moneys 
24in the Fund may be used by the Department of Agriculture, 
25subject to appropriation, solely for
infrastructure 
 
 
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1improvements to the Illinois State Fairgrounds in Sangamon 
2County, including, but not limited to, track surfaces (main 
3track and practice track), grandstands, audio and visual 
4systems, paddocks and barns and associated surface areas, 
5restroom facilities on the backstretch, and roadway surfaces 
6around the racing facility. The State Fairgrounds Capital 
7Improvement Fund is not subject to administrative chargebacks, 
8including, but not limited to, those authorized under Section 
98h of the State Finance Act.

10 Section 90-17. The Illinois Procurement Code is amended by 
11changing Section 1-10 as follows:



12 (30 ILCS 500/1-10)


13 Sec. 1-10. Application. 

14 (a) This Code applies only to procurements for which 
15contractors were first
solicited on or after July 1, 1998. This 
16Code shall not be construed to affect
or impair any contract, 
17or any provision of a contract, entered into based on a

18solicitation prior to the implementation date of this Code as 
19described in
Article 99, including but not limited to any 
20covenant entered into with respect
to any revenue bonds or 
21similar instruments.
All procurements for which contracts are 
22solicited between the effective date
of Articles 50 and 99 and 
23July 1, 1998 shall be substantially in accordance
with this 
24Code and its intent.

 
 
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1 (b) This Code shall apply regardless of the source of the 
2funds with which
the contracts are paid, including federal 
3assistance moneys.
This Code shall
not apply to:


4  (1) Contracts between the State and its political 
5 subdivisions or other
governments, or between State 
6 governmental bodies except as specifically
provided in 
7 this Code.


8  (2) Grants, except for the filing requirements of 
9 Section 20-80.


10  (3) Purchase of care.


11  (4) Hiring of an individual as employee and not as an 
12 independent
contractor, whether pursuant to an employment 
13 code or policy or by contract
directly with that 
14 individual.


15  (5) Collective bargaining contracts.


16  (6) Purchase of real estate, except that notice of this 
17 type of contract with a value of more than $25,000 must be 
18 published in the Procurement Bulletin within 7 days after 
19 the deed is recorded in the county of jurisdiction. The 
20 notice shall identify the real estate purchased, the names 
21 of all parties to the contract, the value of the contract, 
22 and the effective date of the contract.


23  (7) Contracts necessary to prepare for anticipated 
24 litigation, enforcement
actions, or investigations, 
25 provided
that the chief legal counsel to the Governor shall 
26 give his or her prior
approval when the procuring agency is 
 
 
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1 one subject to the jurisdiction of the
Governor, and 
2 provided that the chief legal counsel of any other 
3 procuring
entity
subject to this Code shall give his or her 
4 prior approval when the procuring
entity is not one subject 
5 to the jurisdiction of the Governor.


6  (8) Contracts for
services to Northern Illinois 
7 University by a person, acting as
an independent 
8 contractor, who is qualified by education, experience, and

9 technical ability and is selected by negotiation for the 
10 purpose of providing
non-credit educational service 
11 activities or products by means of specialized
programs 
12 offered by the university.


13  (9) Procurement expenditures by the Illinois 
14 Conservation Foundation
when only private funds are used.

15  (10) Procurement expenditures by the Illinois Health 
16 Information Exchange Authority involving private funds 
17 from the Health Information Exchange Fund. "Private funds" 
18 means gifts, donations, and private grants. 
19  (11) Public-private agreements entered into according 
20 to the procurement requirements of Section 20 of the 
21 Public-Private Partnerships for Transportation Act and 
22 design-build agreements entered into according to the 
23 procurement requirements of Section 25 of the 
24 Public-Private Partnerships for Transportation Act.
25 (c) This Code does not apply to the electric power 
26procurement process provided for under Section 1-75 of the 
 
 
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1Illinois Power Agency Act and Section 16-111.5 of the Public 
2Utilities Act.
3 (d) Except for Section 20-160 and Article 50 of this Code, 
4and as expressly required by Section 9.1 of the Illinois 
5Lottery Law, the provisions of this Code do not apply to the 
6procurement process provided for under Section 9.1 of the 
7Illinois Lottery Law. In addition, except for Section 20-160 
8and Article 50 of this Code, the provisions of this Code also 
9do not apply to contracts and subcontracts awarded pursuant to 
10Section 7.18 of the Illinois Lottery Law.
11 (e) This Code does not apply to the process used by the 
12Capital Development Board to retain a person or entity to 
13assist the Capital Development Board with its duties related to 
14the determination of costs of a clean coal SNG brownfield 
15facility, as defined by Section 1-10 of the Illinois Power 
16Agency Act, as required in subsection (h-3) of Section 9-220 of 
17the Public Utilities Act, including calculating the range of 
18capital costs, the range of operating and maintenance costs, or 
19the sequestration costs or monitoring the construction of clean 
20coal SNG brownfield facility for the full duration of 
21construction.
22 (f) This Code does not apply to the process used by the 
23Illinois Power Agency to retain a mediator to mediate sourcing 
24agreement disputes between gas utilities and the clean coal SNG 
25brownfield facility, as defined in Section 1-10 of the Illinois 
26Power Agency Act, as required under subsection (h-1) of Section 
 
 
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19-220 of the Public Utilities Act. 
2 (g) This Code does not apply to the processes used by the 
3Illinois Power Agency to retain a mediator to mediate contract 
4disputes between gas utilities and the clean coal SNG facility 
5and to retain an expert to assist in the review of contracts 
6under subsection (h) of Section 9-220 of the Public Utilities 
7Act. This Code does not apply to the process used by the 
8Illinois Commerce Commission to retain an expert to assist in 
9determining the actual incurred costs of the clean coal SNG 
10facility and the reasonableness of those costs as required 
11under subsection (h) of Section 9-220 of the Public Utilities 
12Act.
13 (h) This Code does not apply to the process to procure or 
14contracts entered into in accordance with Sections 11-5.2 and 
1511-5.3 of the Illinois Public Aid Code. 
16 (i) (h) Each chief procurement officer may access records 
17necessary to review whether a contract, purchase, or other 
18expenditure is or is not subject to the provisions of this 
19Code, unless such records would be subject to attorney-client 
20privilege. 
21(Source: P.A. 96-840, eff. 12-23-09; 96-1331, eff. 7-27-10; 
2297-96, eff. 7-13-11; 97-239, eff. 8-2-11; 97-502, eff. 8-23-11; 
2397-689, eff. 6-14-12; 97-813, eff. 7-13-12; 97-895, eff. 
248-3-12; revised 8-23-12.)


25 Section 90-20. The Illinois Income Tax Act is amended by 
 
 
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1changing Sections 201, 303, 304 and 710 as follows:

2 (35 ILCS 5/201) (from Ch. 120, par. 2-201)
3 Sec. 201. Tax Imposed. 
4 (a) In general. A tax measured by net income is hereby 
5imposed on every
individual, corporation, trust and estate for 
6each taxable year ending
after July 31, 1969 on the privilege 
7of earning or receiving income in or
as a resident of this 
8State. Such tax shall be in addition to all other
occupation or 
9privilege taxes imposed by this State or by any municipal

10corporation or political subdivision thereof.
11 (b) Rates. The tax imposed by subsection (a) of this 
12Section shall be
determined as follows, except as adjusted by 
13subsection (d-1):
14  (1) In the case of an individual, trust or estate, for 
15 taxable years
ending prior to July 1, 1989, an amount equal 
16 to 2 1/2% of the taxpayer's
net income for the taxable 
17 year.
18  (2) In the case of an individual, trust or estate, for 
19 taxable years
beginning prior to July 1, 1989 and ending 
20 after June 30, 1989, an amount
equal to the sum of (i) 2 
21 1/2% of the taxpayer's net income for the period
prior to 
22 July 1, 1989, as calculated under Section 202.3, and (ii) 
23 3% of the
taxpayer's net income for the period after June 
24 30, 1989, as calculated
under Section 202.3.
25  (3) In the case of an individual, trust or estate, for 
 
 
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1 taxable years
beginning after June 30, 1989, and ending 
2 prior to January 1, 2011, an amount equal to 3% of the 
3 taxpayer's net
income for the taxable year.
4  (4) In the case of an individual, trust, or estate, for 
5 taxable years beginning prior to January 1, 2011, and 
6 ending after December 31, 2010, an amount equal to the sum 
7 of (i) 3% of the taxpayer's net income for the period prior 
8 to January 1, 2011, as calculated under Section 202.5, and 
9 (ii) 5% of the taxpayer's net income for the period after 
10 December 31, 2010, as calculated under Section 202.5.
11  (5) In the case of an individual, trust, or estate, for 
12 taxable years beginning on or after January 1, 2011, and 
13 ending prior to January 1, 2015, an amount equal to 5% of 
14 the taxpayer's net income for the taxable year.
15  (5.1) In the case of an individual, trust, or estate, 
16 for taxable years beginning prior to January 1, 2015, and 
17 ending after December 31, 2014, an amount equal to the sum 
18 of (i) 5% of the taxpayer's net income for the period prior 
19 to January 1, 2015, as calculated under Section 202.5, and 
20 (ii) 3.75% of the taxpayer's net income for the period 
21 after December 31, 2014, as calculated under Section 202.5. 
22  (5.2) In the case of an individual, trust, or estate, 
23 for taxable years beginning on or after January 1, 2015, 
24 and ending prior to January 1, 2025, an amount equal to 
25 3.75% of the taxpayer's net income for the taxable year. 
26  (5.3) In the case of an individual, trust, or estate, 
 
 
09800SB1739sam001- 133 -LRB098 10559 AMC 42403 a


1 for taxable years beginning prior to January 1, 2025, and 
2 ending after December 31, 2024, an amount equal to the sum 
3 of (i) 3.75% of the taxpayer's net income for the period 
4 prior to January 1, 2025, as calculated under Section 
5 202.5, and (ii) 3.25% of the taxpayer's net income for the 
6 period after December 31, 2024, as calculated under Section 
7 202.5. 
8  (5.4) In the case of an individual, trust, or estate, 
9 for taxable years beginning on or after January 1, 2025, an 
10 amount equal to 3.25% of the taxpayer's net income for the 
11 taxable year. 
12  (6) In the case of a corporation, for taxable years

13 ending prior to July 1, 1989, an amount equal to 4% of the

14 taxpayer's net income for the taxable year.
15  (7) In the case of a corporation, for taxable years 
16 beginning prior to
July 1, 1989 and ending after June 30, 
17 1989, an amount equal to the sum of
(i) 4% of the 
18 taxpayer's net income for the period prior to July 1, 1989,

19 as calculated under Section 202.3, and (ii) 4.8% of the 
20 taxpayer's net
income for the period after June 30, 1989, 
21 as calculated under Section
202.3.
22  (8) In the case of a corporation, for taxable years 
23 beginning after
June 30, 1989, and ending prior to January 
24 1, 2011, an amount equal to 4.8% of the taxpayer's net 
25 income for the
taxable year.
26  (9) In the case of a corporation, for taxable years 
 
 
09800SB1739sam001- 134 -LRB098 10559 AMC 42403 a


1 beginning prior to January 1, 2011, and ending after 
2 December 31, 2010, an amount equal to the sum of (i) 4.8% 
3 of the taxpayer's net income for the period prior to 
4 January 1, 2011, as calculated under Section 202.5, and 
5 (ii) 7% of the taxpayer's net income for the period after 
6 December 31, 2010, as calculated under Section 202.5. 
7  (10) In the case of a corporation, for taxable years 
8 beginning on or after January 1, 2011, and ending prior to 
9 January 1, 2015, an amount equal to 7% of the taxpayer's 
10 net income for the taxable year. 
11  (11) In the case of a corporation, for taxable years 
12 beginning prior to January 1, 2015, and ending after 
13 December 31, 2014, an amount equal to the sum of (i) 7% of 
14 the taxpayer's net income for the period prior to January 
15 1, 2015, as calculated under Section 202.5, and (ii) 5.25% 
16 of the taxpayer's net income for the period after December 
17 31, 2014, as calculated under Section 202.5. 
18  (12) In the case of a corporation, for taxable years 
19 beginning on or after January 1, 2015, and ending prior to 
20 January 1, 2025, an amount equal to 5.25% of the taxpayer's 
21 net income for the taxable year. 
22  (13) In the case of a corporation, for taxable years 
23 beginning prior to January 1, 2025, and ending after 
24 December 31, 2024, an amount equal to the sum of (i) 5.25% 
25 of the taxpayer's net income for the period prior to 
26 January 1, 2025, as calculated under Section 202.5, and 
 
 
09800SB1739sam001- 135 -LRB098 10559 AMC 42403 a


1 (ii) 4.8% of the taxpayer's net income for the period after 
2 December 31, 2024, as calculated under Section 202.5. 
3  (14) In the case of a corporation, for taxable years 
4 beginning on or after January 1, 2025, an amount equal to 
5 4.8% of the taxpayer's net income for the taxable year. 
6 The rates under this subsection (b) are subject to the 
7provisions of Section 201.5. 
8 (b-5) Surcharge; sale or exchange of assets, properties, 
9and intangibles of electronic gaming licensees. For each of 
10taxable years 2013 through 2021, a surcharge is imposed on all 
11taxpayers on income arising from the sale or exchange of 
12capital assets, depreciable business property, real property 
13used in the trade or business, and Section 197 intangibles (i) 
14of an organization licensee under the Illinois Horse Racing Act 
15of 1975 and (ii) of an electronic gaming licensee under the 
16Illinois Gambling Act. The amount of the surcharge is equal to 
17the amount of federal income tax liability for the taxable year 
18attributable to those sales and exchanges. The surcharge 
19imposed shall not apply if: 
20  (1) the electronic gaming license, organization 
21 license, or race track property is transferred as a result 
22 of any of the following:
23   (A) bankruptcy, a receivership, or a debt 
24 adjustment initiated by or against the initial 
25 licensee or the substantial owners of the initial 
26 licensee;
 
 
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1   (B) cancellation, revocation, or termination of 
2 any such license by the Illinois Gaming Board or the 
3 Illinois Racing Board;
4   (C) a determination by the Illinois Gaming Board 
5 that transfer of the license is in the best interests 
6 of Illinois gaming;
7   (D) the death of an owner of the equity interest in 
8 a licensee;
9   (E) the acquisition of a controlling interest in 
10 the stock or substantially all of the assets of a 
11 publicly traded company;
12   (F) a transfer by a parent company to a wholly 
13 owned subsidiary; or
14   (G) the transfer or sale to or by one person to 
15 another person where both persons were initial owners 
16 of the license when the license was issued; or 
17  (2) the controlling interest in the electronic gaming 
18 license, organization license, or race track property is 
19 transferred in a transaction to lineal descendants in which 
20 no gain or loss is recognized or as a result of a 
21 transaction in accordance with Section 351 of the Internal 
22 Revenue Code in which no gain or loss is recognized; or
23  (3) live horse racing was not conducted in 2011 under a 
24 license issued pursuant to the Illinois Horse Racing Act of 
25 1975. 
26 The transfer of an electronic gaming license, organization 
 
 
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1license, or race track property by a person other than the 
2initial licensee to receive the electronic gaming license is 
3not subject to a surcharge. The Department shall adopt rules 
4necessary to implement and administer this subsection. 
5 (b-10) Surcharge; sale or exchange of an Internet gaming 
6license. For each of taxable years 2013 through 2023, a 
7surcharge is imposed on all taxpayers on income arising from 
8the sale or exchange of an Internet gaming license issued by 
9the Division of Internet Gaming of the Department of the 
10Lottery. The amount of the surcharge is equal to the federal 
11tax liability attributable to such sale or exchange or 
12$10,000,000, whichever is greater. The surcharge imposed shall 
13not apply if:
14  (1) the Internet gaming license is transferred as a 
15 result of any of the following:
16   (A) bankruptcy, a receivership, assignment for the 
17 benefit of creditors, or a debt adjustment initiated by 
18 or against the initial Internet gaming licensee or a 
19 majority owner of the initial licensee;
20   (B) cancellation, revocation, or termination of 
21 any such license by the Division of Internet Gaming; or
22   (D) the transfer or sale to or by one person to 
23 another person where both persons were initial owners 
24 of the license when the license was issued;
25  (2) after a public hearing, a determination is made by 
26 the Superintendent of the Lottery, subject to the approval 
 
 
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1 of the Governor, that transfer of the license and exemption 
2 from the surcharge is in the best interest of Illinois 
3 gaming; this exception may be further defined by rules 
4 adopted by the Division of Internet Gaming; or
5  (3) the controlling interest in the Internet gaming 
6 license is transferred in a transaction to lineal 
7 descendants in which no gain or loss is recognized or as a 
8 result of a transaction in accordance with Section 351 of 
9 the Internal Revenue Code in which no gain or loss is 
10 recognized.
11 The Department shall adopt rules necessary to implement and 
12administer this subsection. 
13 (c) Personal Property Tax Replacement Income Tax.

14Beginning on July 1, 1979 and thereafter, in addition to such 
15income
tax, there is also hereby imposed the Personal Property 
16Tax Replacement
Income Tax measured by net income on every 
17corporation (including Subchapter
S corporations), partnership 
18and trust, for each taxable year ending after
June 30, 1979. 
19Such taxes are imposed on the privilege of earning or
receiving 
20income in or as a resident of this State. The Personal Property

21Tax Replacement Income Tax shall be in addition to the income 
22tax imposed
by subsections (a) and (b) of this Section and in 
23addition to all other
occupation or privilege taxes imposed by 
24this State or by any municipal
corporation or political 
25subdivision thereof.
26 (d) Additional Personal Property Tax Replacement Income 
 
 
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1Tax Rates.
The personal property tax replacement income tax 
2imposed by this subsection
and subsection (c) of this Section 
3in the case of a corporation, other
than a Subchapter S 
4corporation and except as adjusted by subsection (d-1),
shall 
5be an additional amount equal to
2.85% of such taxpayer's net 
6income for the taxable year, except that
beginning on January 
71, 1981, and thereafter, the rate of 2.85% specified
in this 
8subsection shall be reduced to 2.5%, and in the case of a

9partnership, trust or a Subchapter S corporation shall be an 
10additional
amount equal to 1.5% of such taxpayer's net income 
11for the taxable year.
12 (d-1) Rate reduction for certain foreign insurers. In the 
13case of a
foreign insurer, as defined by Section 35A-5 of the 
14Illinois Insurance Code,
whose state or country of domicile 
15imposes on insurers domiciled in Illinois
a retaliatory tax 
16(excluding any insurer
whose premiums from reinsurance assumed 
17are 50% or more of its total insurance
premiums as determined 
18under paragraph (2) of subsection (b) of Section 304,
except 
19that for purposes of this determination premiums from 
20reinsurance do
not include premiums from inter-affiliate 
21reinsurance arrangements),
beginning with taxable years ending 
22on or after December 31, 1999,
the sum of
the rates of tax 
23imposed by subsections (b) and (d) shall be reduced (but not

24increased) to the rate at which the total amount of tax imposed 
25under this Act,
net of all credits allowed under this Act, 
26shall equal (i) the total amount of
tax that would be imposed 
 
 
09800SB1739sam001- 140 -LRB098 10559 AMC 42403 a


1on the foreign insurer's net income allocable to
Illinois for 
2the taxable year by such foreign insurer's state or country of

3domicile if that net income were subject to all income taxes 
4and taxes
measured by net income imposed by such foreign 
5insurer's state or country of
domicile, net of all credits 
6allowed or (ii) a rate of zero if no such tax is
imposed on such 
7income by the foreign insurer's state of domicile.
For the 
8purposes of this subsection (d-1), an inter-affiliate includes 
9a
mutual insurer under common management.
10  (1) For the purposes of subsection (d-1), in no event 
11 shall the sum of the
rates of tax imposed by subsections 
12 (b) and (d) be reduced below the rate at
which the sum of:
13   (A) the total amount of tax imposed on such foreign 
14 insurer under
this Act for a taxable year, net of all 
15 credits allowed under this Act, plus
16   (B) the privilege tax imposed by Section 409 of the 
17 Illinois Insurance
Code, the fire insurance company 
18 tax imposed by Section 12 of the Fire
Investigation 
19 Act, and the fire department taxes imposed under 
20 Section 11-10-1
of the Illinois Municipal Code,
21 equals 1.25% for taxable years ending prior to December 31, 
22 2003, or
1.75% for taxable years ending on or after 
23 December 31, 2003, of the net
taxable premiums written for 
24 the taxable year,
as described by subsection (1) of Section 
25 409 of the Illinois Insurance Code.
This paragraph will in 
26 no event increase the rates imposed under subsections
(b) 
 
 
09800SB1739sam001- 141 -LRB098 10559 AMC 42403 a


1 and (d).
2  (2) Any reduction in the rates of tax imposed by this 
3 subsection shall be
applied first against the rates imposed 
4 by subsection (b) and only after the
tax imposed by 
5 subsection (a) net of all credits allowed under this 
6 Section
other than the credit allowed under subsection (i) 
7 has been reduced to zero,
against the rates imposed by 
8 subsection (d).
9 This subsection (d-1) is exempt from the provisions of 
10Section 250.
11 (e) Investment credit. A taxpayer shall be allowed a credit

12against the Personal Property Tax Replacement Income Tax for

13investment in qualified property.
14  (1) A taxpayer shall be allowed a credit equal to .5% 
15 of
the basis of qualified property placed in service during 
16 the taxable year,
provided such property is placed in 
17 service on or after
July 1, 1984. There shall be allowed an 
18 additional credit equal
to .5% of the basis of qualified 
19 property placed in service during the
taxable year, 
20 provided such property is placed in service on or
after 
21 July 1, 1986, and the taxpayer's base employment
within 
22 Illinois has increased by 1% or more over the preceding 
23 year as
determined by the taxpayer's employment records 
24 filed with the
Illinois Department of Employment Security. 
25 Taxpayers who are new to
Illinois shall be deemed to have 
26 met the 1% growth in base employment for
the first year in 
 
 
09800SB1739sam001- 142 -LRB098 10559 AMC 42403 a


1 which they file employment records with the Illinois

2 Department of Employment Security. The provisions added to 
3 this Section by
Public Act 85-1200 (and restored by Public 
4 Act 87-895) shall be
construed as declaratory of existing 
5 law and not as a new enactment. If,
in any year, the 
6 increase in base employment within Illinois over the

7 preceding year is less than 1%, the additional credit shall 
8 be limited to that
percentage times a fraction, the 
9 numerator of which is .5% and the denominator
of which is 
10 1%, but shall not exceed .5%. The investment credit shall 
11 not be
allowed to the extent that it would reduce a 
12 taxpayer's liability in any tax
year below zero, nor may 
13 any credit for qualified property be allowed for any
year 
14 other than the year in which the property was placed in 
15 service in
Illinois. For tax years ending on or after 
16 December 31, 1987, and on or
before December 31, 1988, the 
17 credit shall be allowed for the tax year in
which the 
18 property is placed in service, or, if the amount of the 
19 credit
exceeds the tax liability for that year, whether it 
20 exceeds the original
liability or the liability as later 
21 amended, such excess may be carried
forward and applied to 
22 the tax liability of the 5 taxable years following
the 
23 excess credit years if the taxpayer (i) makes investments 
24 which cause
the creation of a minimum of 2,000 full-time 
25 equivalent jobs in Illinois,
(ii) is located in an 
26 enterprise zone established pursuant to the Illinois

 
 
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1 Enterprise Zone Act and (iii) is certified by the 
2 Department of Commerce
and Community Affairs (now 
3 Department of Commerce and Economic Opportunity) as 
4 complying with the requirements specified in
clause (i) and 
5 (ii) by July 1, 1986. The Department of Commerce and

6 Community Affairs (now Department of Commerce and Economic 
7 Opportunity) shall notify the Department of Revenue of all 
8 such
certifications immediately. For tax years ending 
9 after December 31, 1988,
the credit shall be allowed for 
10 the tax year in which the property is
placed in service, 
11 or, if the amount of the credit exceeds the tax
liability 
12 for that year, whether it exceeds the original liability or 
13 the
liability as later amended, such excess may be carried 
14 forward and applied
to the tax liability of the 5 taxable 
15 years following the excess credit
years. The credit shall 
16 be applied to the earliest year for which there is
a 
17 liability. If there is credit from more than one tax year 
18 that is
available to offset a liability, earlier credit 
19 shall be applied first.
20  (2) The term "qualified property" means property 
21 which:
22   (A) is tangible, whether new or used, including 
23 buildings and structural
components of buildings and 
24 signs that are real property, but not including
land or 
25 improvements to real property that are not a structural 
26 component of a
building such as landscaping, sewer 
 
 
09800SB1739sam001- 144 -LRB098 10559 AMC 42403 a


1 lines, local access roads, fencing, parking
lots, and 
2 other appurtenances;
3   (B) is depreciable pursuant to Section 167 of the 
4 Internal Revenue Code,
except that "3-year property" 
5 as defined in Section 168(c)(2)(A) of that
Code is not 
6 eligible for the credit provided by this subsection 
7 (e);
8   (C) is acquired by purchase as defined in Section 
9 179(d) of
the Internal Revenue Code;
10   (D) is used in Illinois by a taxpayer who is 
11 primarily engaged in
manufacturing, or in mining coal 
12 or fluorite, or in retailing, or was placed in service 
13 on or after July 1, 2006 in a River Edge Redevelopment 
14 Zone established pursuant to the River Edge 
15 Redevelopment Zone Act; and
16   (E) has not previously been used in Illinois in 
17 such a manner and by
such a person as would qualify for 
18 the credit provided by this subsection
(e) or 
19 subsection (f).
20  (3) For purposes of this subsection (e), 
21 "manufacturing" means
the material staging and production 
22 of tangible personal property by
procedures commonly 
23 regarded as manufacturing, processing, fabrication, or

24 assembling which changes some existing material into new 
25 shapes, new
qualities, or new combinations. For purposes of 
26 this subsection
(e) the term "mining" shall have the same 
 
 
09800SB1739sam001- 145 -LRB098 10559 AMC 42403 a


1 meaning as the term "mining" in
Section 613(c) of the 
2 Internal Revenue Code. For purposes of this subsection
(e), 
3 the term "retailing" means the sale of tangible personal 
4 property for use or consumption and not for resale, or

5 services rendered in conjunction with the sale of tangible 
6 personal property for use or consumption and not for 
7 resale. For purposes of this subsection (e), "tangible 
8 personal property" has the same meaning as when that term 
9 is used in the Retailers' Occupation Tax Act, and, for 
10 taxable years ending after December 31, 2008, does not 
11 include the generation, transmission, or distribution of 
12 electricity.
13  (4) The basis of qualified property shall be the basis

14 used to compute the depreciation deduction for federal 
15 income tax purposes.
16  (5) If the basis of the property for federal income tax 
17 depreciation
purposes is increased after it has been placed 
18 in service in Illinois by
the taxpayer, the amount of such 
19 increase shall be deemed property placed
in service on the 
20 date of such increase in basis.
21  (6) The term "placed in service" shall have the same

22 meaning as under Section 46 of the Internal Revenue Code.
23  (7) If during any taxable year, any property ceases to

24 be qualified property in the hands of the taxpayer within 
25 48 months after
being placed in service, or the situs of 
26 any qualified property is
moved outside Illinois within 48 
 
 
09800SB1739sam001- 146 -LRB098 10559 AMC 42403 a


1 months after being placed in service, the
Personal Property 
2 Tax Replacement Income Tax for such taxable year shall be

3 increased. Such increase shall be determined by (i) 
4 recomputing the
investment credit which would have been 
5 allowed for the year in which
credit for such property was 
6 originally allowed by eliminating such
property from such 
7 computation and, (ii) subtracting such recomputed credit

8 from the amount of credit previously allowed. For the 
9 purposes of this
paragraph (7), a reduction of the basis of 
10 qualified property resulting
from a redetermination of the 
11 purchase price shall be deemed a disposition
of qualified 
12 property to the extent of such reduction.
13  (8) Unless the investment credit is extended by law, 
14 the
basis of qualified property shall not include costs 
15 incurred after
December 31, 2018, except for costs incurred 
16 pursuant to a binding
contract entered into on or before 
17 December 31, 2018.
18  (9) Each taxable year ending before December 31, 2000, 
19 a partnership may
elect to pass through to its
partners the 
20 credits to which the partnership is entitled under this 
21 subsection
(e) for the taxable year. A partner may use the 
22 credit allocated to him or her
under this paragraph only 
23 against the tax imposed in subsections (c) and (d) of
this 
24 Section. If the partnership makes that election, those 
25 credits shall be
allocated among the partners in the 
26 partnership in accordance with the rules
set forth in 
 
 
09800SB1739sam001- 147 -LRB098 10559 AMC 42403 a


1 Section 704(b) of the Internal Revenue Code, and the rules

2 promulgated under that Section, and the allocated amount of 
3 the credits shall
be allowed to the partners for that 
4 taxable year. The partnership shall make
this election on 
5 its Personal Property Tax Replacement Income Tax return for

6 that taxable year. The election to pass through the credits 
7 shall be
irrevocable.
8  For taxable years ending on or after December 31, 2000, 
9 a
partner that qualifies its
partnership for a subtraction 
10 under subparagraph (I) of paragraph (2) of
subsection (d) 
11 of Section 203 or a shareholder that qualifies a Subchapter 
12 S
corporation for a subtraction under subparagraph (S) of 
13 paragraph (2) of
subsection (b) of Section 203 shall be 
14 allowed a credit under this subsection
(e) equal to its 
15 share of the credit earned under this subsection (e) during

16 the taxable year by the partnership or Subchapter S 
17 corporation, determined in
accordance with the 
18 determination of income and distributive share of
income 
19 under Sections 702 and 704 and Subchapter S of the Internal 
20 Revenue
Code. This paragraph is exempt from the provisions 
21 of Section 250.
22 (f) Investment credit; Enterprise Zone; River Edge 
23Redevelopment Zone.
24  (1) A taxpayer shall be allowed a credit against the 
25 tax imposed
by subsections (a) and (b) of this Section for 
26 investment in qualified
property which is placed in service 
 
 
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1 in an Enterprise Zone created
pursuant to the Illinois 
2 Enterprise Zone Act or, for property placed in service on 
3 or after July 1, 2006, a River Edge Redevelopment Zone 
4 established pursuant to the River Edge Redevelopment Zone 
5 Act. For partners, shareholders
of Subchapter S 
6 corporations, and owners of limited liability companies,

7 if the liability company is treated as a partnership for 
8 purposes of
federal and State income taxation, there shall 
9 be allowed a credit under
this subsection (f) to be 
10 determined in accordance with the determination
of income 
11 and distributive share of income under Sections 702 and 704 
12 and
Subchapter S of the Internal Revenue Code. The credit 
13 shall be .5% of the
basis for such property. The credit 
14 shall be available only in the taxable
year in which the 
15 property is placed in service in the Enterprise Zone or 
16 River Edge Redevelopment Zone and
shall not be allowed to 
17 the extent that it would reduce a taxpayer's
liability for 
18 the tax imposed by subsections (a) and (b) of this Section 
19 to
below zero. For tax years ending on or after December 
20 31, 1985, the credit
shall be allowed for the tax year in 
21 which the property is placed in
service, or, if the amount 
22 of the credit exceeds the tax liability for that
year, 
23 whether it exceeds the original liability or the liability 
24 as later
amended, such excess may be carried forward and 
25 applied to the tax
liability of the 5 taxable years 
26 following the excess credit year.
The credit shall be 
 
 
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1 applied to the earliest year for which there is a

2 liability. If there is credit from more than one tax year 
3 that is available
to offset a liability, the credit 
4 accruing first in time shall be applied
first.
5  (2) The term qualified property means property which:
6   (A) is tangible, whether new or used, including 
7 buildings and
structural components of buildings;
8   (B) is depreciable pursuant to Section 167 of the 
9 Internal Revenue
Code, except that "3-year property" 
10 as defined in Section 168(c)(2)(A) of
that Code is not 
11 eligible for the credit provided by this subsection 
12 (f);
13   (C) is acquired by purchase as defined in Section 
14 179(d) of
the Internal Revenue Code;
15   (D) is used in the Enterprise Zone or River Edge 
16 Redevelopment Zone by the taxpayer; and
17   (E) has not been previously used in Illinois in 
18 such a manner and by
such a person as would qualify for 
19 the credit provided by this subsection
(f) or 
20 subsection (e).
21  (3) The basis of qualified property shall be the basis 
22 used to compute
the depreciation deduction for federal 
23 income tax purposes.
24  (4) If the basis of the property for federal income tax 
25 depreciation
purposes is increased after it has been placed 
26 in service in the Enterprise
Zone or River Edge 
 
 
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1 Redevelopment Zone by the taxpayer, the amount of such 
2 increase shall be deemed property
placed in service on the 
3 date of such increase in basis.
4  (5) The term "placed in service" shall have the same 
5 meaning as under
Section 46 of the Internal Revenue Code.
6  (6) If during any taxable year, any property ceases to 
7 be qualified
property in the hands of the taxpayer within 
8 48 months after being placed
in service, or the situs of 
9 any qualified property is moved outside the
Enterprise Zone 
10 or River Edge Redevelopment Zone within 48 months after 
11 being placed in service, the tax
imposed under subsections 
12 (a) and (b) of this Section for such taxable year
shall be 
13 increased. Such increase shall be determined by (i) 
14 recomputing
the investment credit which would have been 
15 allowed for the year in which
credit for such property was 
16 originally allowed by eliminating such
property from such 
17 computation, and (ii) subtracting such recomputed credit

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

14 (g) Jobs Tax Credit; River Edge Redevelopment Zone and 
15Foreign Trade Zone or Sub-Zone.
16  (1) A taxpayer conducting a trade or business, for 
17 taxable years ending on or after December 31, 2006, in a 
18 River Edge Redevelopment Zone or conducting a trade or 
19 business in a federally designated
Foreign Trade Zone or 
20 Sub-Zone shall be allowed a credit against the tax
imposed 
21 by subsections (a) and (b) of this Section in the amount of 
22 $500
per eligible employee hired to work in the zone during 
23 the taxable year.
24  (2) To qualify for the credit:
25   (A) the taxpayer must hire 5 or more eligible 
26 employees to work in a River Edge Redevelopment Zone or 
 
 
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1 federally designated Foreign Trade Zone or Sub-Zone

2 during the taxable year;
3   (B) the taxpayer's total employment within the 
4 River Edge Redevelopment Zone or
federally designated 
5 Foreign Trade Zone or Sub-Zone must
increase by 5 or 
6 more full-time employees beyond the total employed in 
7 that
zone at the end of the previous tax year for which 
8 a jobs tax
credit under this Section was taken, or 
9 beyond the total employed by the
taxpayer as of 
10 December 31, 1985, whichever is later; and
11   (C) the eligible employees must be employed 180 
12 consecutive days in
order to be deemed hired for 
13 purposes of this subsection.
14  (3) An "eligible employee" means an employee who is:
15   (A) Certified by the Department of Commerce and 
16 Economic Opportunity
as "eligible for services" 
17 pursuant to regulations promulgated in
accordance with 
18 Title II of the Job Training Partnership Act, Training

19 Services for the Disadvantaged or Title III of the Job 
20 Training Partnership
Act, Employment and Training 
21 Assistance for Dislocated Workers Program.
22   (B) Hired after the River Edge Redevelopment Zone 
23 or federally designated Foreign
Trade Zone or Sub-Zone 
24 was designated or the trade or
business was located in 
25 that zone, whichever is later.
26   (C) Employed in the River Edge Redevelopment Zone 
 
 
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1 or Foreign Trade Zone or
Sub-Zone. An employee is 
2 employed in a federally designated Foreign Trade Zone 
3 or Sub-Zone
if his services are rendered there or it is 
4 the base of
operations for the services performed.
5   (D) A full-time employee working 30 or more hours 
6 per week.
7  (4) For tax years ending on or after December 31, 1985 
8 and prior to
December 31, 1988, the credit shall be allowed 
9 for the tax year in which
the eligible employees are hired. 
10 For tax years ending on or after
December 31, 1988, the 
11 credit shall be allowed for the tax year immediately

12 following the tax year in which the eligible employees are 
13 hired. 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,
earlier 
21 credit shall be applied first.
22  (5) The Department of Revenue shall promulgate such 
23 rules and regulations
as may be deemed necessary to carry 
24 out the purposes of this subsection (g).
25  (6) The credit shall be available for eligible 
26 employees hired on or
after January 1, 1986.
 
 
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1 (h) Investment credit; High Impact Business.
2  (1) Subject to subsections (b) and (b-5) of Section
5.5 
3 of the Illinois Enterprise Zone Act, a taxpayer shall be 
4 allowed a credit
against the tax imposed by subsections (a) 
5 and (b) of this Section for
investment in qualified

6 property which is placed in service by a Department of 
7 Commerce and Economic Opportunity
designated High Impact 
8 Business. The credit shall be .5% of the basis
for such 
9 property. The credit shall not be available (i) until the 
10 minimum
investments in qualified property set forth in 
11 subdivision (a)(3)(A) of
Section 5.5 of the Illinois

12 Enterprise Zone Act have been satisfied
or (ii) until the 
13 time authorized in subsection (b-5) of the Illinois

14 Enterprise Zone Act for entities designated as High Impact 
15 Businesses under
subdivisions (a)(3)(B), (a)(3)(C), and 
16 (a)(3)(D) of Section 5.5 of the Illinois
Enterprise Zone 
17 Act, and shall not be allowed to the extent that it would

18 reduce a taxpayer's liability for the tax imposed by 
19 subsections (a) and (b) of
this Section to below zero. The 
20 credit applicable to such investments shall be
taken in the 
21 taxable year in which such investments have been completed. 
22 The
credit for additional investments beyond the minimum 
23 investment by a designated
high impact business authorized 
24 under subdivision (a)(3)(A) of Section 5.5 of
the Illinois 
25 Enterprise Zone Act shall be available only in the taxable 
26 year in
which the property is placed in service and shall 
 
 
09800SB1739sam001- 155 -LRB098 10559 AMC 42403 a


1 not be allowed to the extent
that it would reduce a 
2 taxpayer's liability for the tax imposed by subsections
(a) 
3 and (b) of this Section to below zero.
For tax years ending 
4 on or after December 31, 1987, the credit shall be
allowed 
5 for the tax year in which the property is placed in 
6 service, or, if
the amount of the credit exceeds the tax 
7 liability for that year, whether
it exceeds the original 
8 liability or the liability as later amended, such
excess 
9 may be carried forward and applied to the tax liability of 
10 the 5
taxable years following the excess credit year. The 
11 credit shall be
applied to the earliest year for which 
12 there is a liability. If there is
credit from more than one 
13 tax year that is available to offset a liability,
the 
14 credit accruing first in time shall be applied first.
15  Changes made in this subdivision (h)(1) by Public Act 
16 88-670
restore changes made by Public Act 85-1182 and 
17 reflect existing law.
18  (2) The term qualified property means property which:
19   (A) is tangible, whether new or used, including 
20 buildings and
structural components of buildings;
21   (B) is depreciable pursuant to Section 167 of the 
22 Internal Revenue
Code, except that "3-year property" 
23 as defined in Section 168(c)(2)(A) of
that Code is not 
24 eligible for the credit provided by this subsection 
25 (h);
26   (C) is acquired by purchase as defined in Section 
 
 
09800SB1739sam001- 156 -LRB098 10559 AMC 42403 a


1 179(d) of the
Internal Revenue Code; and
2   (D) is not eligible for the Enterprise Zone 
3 Investment Credit provided
by subsection (f) of this 
4 Section.
5  (3) The basis of qualified property shall be the basis 
6 used to compute
the depreciation deduction for federal 
7 income tax purposes.
8  (4) If the basis of the property for federal income tax 
9 depreciation
purposes is increased after it has been placed 
10 in service in a federally
designated Foreign Trade Zone or 
11 Sub-Zone located in Illinois by the taxpayer,
the amount of 
12 such increase shall be deemed property placed in service on

13 the date of such increase in basis.
14  (5) The term "placed in service" shall have the same 
15 meaning as under
Section 46 of the Internal Revenue Code.
16  (6) If during any taxable year ending on or before 
17 December 31, 1996,
any property ceases to be qualified

18 property in the hands of the taxpayer within 48 months 
19 after being placed
in service, or the situs of any 
20 qualified property is moved outside
Illinois within 48 
21 months after being placed in service, the tax imposed
under 
22 subsections (a) and (b) of this Section for such taxable 
23 year shall
be increased. Such increase shall be determined 
24 by (i) recomputing the
investment credit which would have 
25 been allowed for the year in which
credit for such property 
26 was originally allowed by eliminating such
property from 
 
 
09800SB1739sam001- 157 -LRB098 10559 AMC 42403 a


1 such computation, and (ii) subtracting such recomputed 
2 credit
from the amount of credit previously allowed. For 
3 the purposes of this
paragraph (6), a reduction of the 
4 basis of qualified property resulting
from a 
5 redetermination of the purchase price shall be deemed a 
6 disposition
of qualified property to the extent of such 
7 reduction.
8  (7) Beginning with tax years ending after December 31, 
9 1996, if a
taxpayer qualifies for the credit under this 
10 subsection (h) and thereby is
granted a tax abatement and 
11 the taxpayer relocates its entire facility in
violation of 
12 the explicit terms and length of the contract under Section

13 18-183 of the Property Tax Code, the tax imposed under 
14 subsections
(a) and (b) of this Section shall be increased 
15 for the taxable year
in which the taxpayer relocated its 
16 facility by an amount equal to the
amount of credit 
17 received by the taxpayer under this subsection (h).
18 (i) Credit for Personal Property Tax Replacement Income 
19Tax.
For tax years ending prior to December 31, 2003, a credit 
20shall be allowed
against the tax imposed by
subsections (a) and 
21(b) of this Section for the tax imposed by subsections (c)
and 
22(d) of this Section. This credit shall be computed by 
23multiplying the tax
imposed by subsections (c) and (d) of this 
24Section by a fraction, the numerator
of which is base income 
25allocable to Illinois and the denominator of which is
Illinois 
26base income, and further multiplying the product by the tax 
 
 
09800SB1739sam001- 158 -LRB098 10559 AMC 42403 a


1rate
imposed by subsections (a) and (b) of this Section.
2 Any credit earned on or after December 31, 1986 under
this 
3subsection which is unused in the year
the credit is computed 
4because it exceeds the tax liability imposed by
subsections (a) 
5and (b) for that year (whether it exceeds the original

6liability or the liability as later amended) may be carried 
7forward and
applied to the tax liability imposed by subsections 
8(a) and (b) of the 5
taxable years following the excess credit 
9year, provided that no credit may
be carried forward to any 
10year ending on or
after December 31, 2003. This credit shall be

11applied first to the earliest year for which there is a 
12liability. If
there is a credit under this subsection from more 
13than one tax year that is
available to offset a liability the 
14earliest credit arising under this
subsection shall be applied 
15first.
16 If, during any taxable year ending on or after December 31, 
171986, the
tax imposed by subsections (c) and (d) of this 
18Section for which a taxpayer
has claimed a credit under this 
19subsection (i) is reduced, the amount of
credit for such tax 
20shall also be reduced. Such reduction shall be
determined by 
21recomputing the credit to take into account the reduced tax

22imposed by subsections (c) and (d). If any portion of the

23reduced amount of credit has been carried to a different 
24taxable year, an
amended return shall be filed for such taxable 
25year to reduce the amount of
credit claimed.
26 (j) Training expense credit. Beginning with tax years 
 
 
09800SB1739sam001- 159 -LRB098 10559 AMC 42403 a


1ending on or
after December 31, 1986 and prior to December 31, 
22003, a taxpayer shall be
allowed a credit against the
tax 
3imposed by subsections (a) and (b) under this Section
for all 
4amounts paid or accrued, on behalf of all persons
employed by 
5the taxpayer in Illinois or Illinois residents employed
outside 
6of Illinois by a taxpayer, for educational or vocational 
7training in
semi-technical or technical fields or semi-skilled 
8or skilled fields, which
were deducted from gross income in the 
9computation of taxable income. The
credit against the tax 
10imposed by subsections (a) and (b) shall be 1.6% of
such 
11training expenses. For partners, shareholders of subchapter S

12corporations, and owners of limited liability companies, if the 
13liability
company is treated as a partnership for purposes of 
14federal and State income
taxation, there shall be allowed a 
15credit under this subsection (j) to be
determined in accordance 
16with the determination of income and distributive
share of 
17income under Sections 702 and 704 and subchapter S of the 
18Internal
Revenue Code.
19 Any credit allowed under this subsection which is unused in 
20the year
the credit is earned may be carried forward to each of 
21the 5 taxable
years following the year for which the credit is 
22first computed until it is
used. This credit shall be applied 
23first to the earliest year for which
there is a liability. If 
24there is a credit under this subsection from more
than one tax 
25year that is available to offset a liability the earliest

26credit arising under this subsection shall be applied first. No 
 
 
09800SB1739sam001- 160 -LRB098 10559 AMC 42403 a


1carryforward
credit may be claimed in any tax year ending on or 
2after
December 31, 2003.
3 (k) Research and development credit. For tax years ending 
4after July 1, 1990 and prior to
December 31, 2003, and 
5beginning again for tax years ending on or after December 31, 
62004, and ending prior to January 1, 2016, a taxpayer shall be

7allowed a credit against the tax imposed by subsections (a) and 
8(b) of this
Section for increasing research activities in this 
9State. The credit
allowed against the tax imposed by 
10subsections (a) and (b) shall be equal
to 6 1/2% of the 
11qualifying expenditures for increasing research activities
in 
12this State. For partners, shareholders of subchapter S 
13corporations, and
owners of limited liability companies, if the 
14liability company is treated as a
partnership for purposes of 
15federal and State income taxation, there shall be
allowed a 
16credit under this subsection to be determined in accordance 
17with the
determination of income and distributive share of 
18income under Sections 702 and
704 and subchapter S of the 
19Internal Revenue Code.
20 For purposes of this subsection, "qualifying expenditures" 
21means the
qualifying expenditures as defined for the federal 
22credit for increasing
research activities which would be 
23allowable under Section 41 of the
Internal Revenue Code and 
24which are conducted in this State, "qualifying
expenditures for 
25increasing research activities in this State" means the
excess 
26of qualifying expenditures for the taxable year in which 
 
 
09800SB1739sam001- 161 -LRB098 10559 AMC 42403 a


1incurred
over qualifying expenditures for the base period, 
2"qualifying expenditures
for the base period" means the average 
3of the qualifying expenditures for
each year in the base 
4period, and "base period" means the 3 taxable years
immediately 
5preceding the taxable year for which the determination is
being 
6made.
7 Any credit in excess of the tax liability for the taxable 
8year
may be carried forward. A taxpayer may elect to have the

9unused credit shown on its final completed return carried over 
10as a credit
against the tax liability for the following 5 
11taxable years or until it has
been fully used, whichever occurs 
12first; provided that no credit earned in a tax year ending 
13prior to December 31, 2003 may be carried forward to any year 
14ending on or after December 31, 2003.
15 If an unused credit is carried forward to a given year from 
162 or more
earlier years, that credit arising in the earliest 
17year will be applied
first against the tax liability for the 
18given year. If a tax liability for
the given year still 
19remains, the credit from the next earliest year will
then be 
20applied, and so on, until all credits have been used or no tax

21liability for the given year remains. Any remaining unused 
22credit or
credits then will be carried forward to the next 
23following year in which a
tax liability is incurred, except 
24that no credit can be carried forward to
a year which is more 
25than 5 years after the year in which the expense for
which the 
26credit is given was incurred.
 
 
09800SB1739sam001- 162 -LRB098 10559 AMC 42403 a


1 No inference shall be drawn from this amendatory Act of the 
291st General
Assembly in construing this Section for taxable 
3years beginning before January
1, 1999.
4 (l) Environmental Remediation Tax Credit.
5  (i) For tax years ending after December 31, 1997 and on 
6 or before
December 31, 2001, a taxpayer shall be allowed a 
7 credit against the tax
imposed by subsections (a) and (b) 
8 of this Section for certain amounts paid
for unreimbursed 
9 eligible remediation costs, as specified in this 
10 subsection.
For purposes of this Section, "unreimbursed 
11 eligible remediation costs" means
costs approved by the 
12 Illinois Environmental Protection Agency ("Agency") under

13 Section 58.14 of the Environmental Protection Act that were 
14 paid in performing
environmental remediation at a site for 
15 which a No Further Remediation Letter
was issued by the 
16 Agency and recorded under Section 58.10 of the 
17 Environmental
Protection Act. The credit must be claimed 
18 for the taxable year in which
Agency approval of the 
19 eligible remediation costs is granted. The credit is
not 
20 available to any taxpayer if the taxpayer or any related 
21 party caused or
contributed to, in any material respect, a 
22 release of regulated substances on,
in, or under the site 
23 that was identified and addressed by the remedial
action 
24 pursuant to the Site Remediation Program of the 
25 Environmental Protection
Act. After the Pollution Control 
26 Board rules are adopted pursuant to the
Illinois 
 
 
09800SB1739sam001- 163 -LRB098 10559 AMC 42403 a


1 Administrative Procedure Act for the administration and 
2 enforcement of
Section 58.9 of the Environmental 
3 Protection Act, determinations as to credit
availability 
4 for purposes of this Section shall be made consistent with 
5 those
rules. For purposes of this Section, "taxpayer" 
6 includes a person whose tax
attributes the taxpayer has 
7 succeeded to under Section 381 of the Internal
Revenue Code 
8 and "related party" includes the persons disallowed a 
9 deduction
for losses by paragraphs (b), (c), and (f)(1) of 
10 Section 267 of the Internal
Revenue Code by virtue of being 
11 a related taxpayer, as well as any of its
partners. The 
12 credit allowed against the tax imposed by subsections (a) 
13 and
(b) shall be equal to 25% of the unreimbursed eligible 
14 remediation costs in
excess of $100,000 per site, except 
15 that the $100,000 threshold shall not apply
to any site 
16 contained in an enterprise zone as determined by the 
17 Department of
Commerce and Community Affairs (now 
18 Department of Commerce and Economic Opportunity). The 
19 total credit allowed shall not exceed
$40,000 per year with 
20 a maximum total of $150,000 per site. For partners and

21 shareholders of subchapter S corporations, there shall be 
22 allowed a credit
under this subsection to be determined in 
23 accordance with the determination of
income and 
24 distributive share of income under Sections 702 and 704 and

25 subchapter S of the Internal Revenue Code.
26  (ii) A credit allowed under this subsection that is 
 
 
09800SB1739sam001- 164 -LRB098 10559 AMC 42403 a


1 unused in the year
the credit is earned may be carried 
2 forward to each of the 5 taxable years
following the year 
3 for which the credit is first earned until it is used.
The 
4 term "unused credit" does not include any amounts of 
5 unreimbursed eligible
remediation costs in excess of the 
6 maximum credit per site authorized under
paragraph (i). 
7 This 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 
 
 
09800SB1739sam001- 165 -LRB098 10559 AMC 42403 a


1 Environmental Protection Act.
2 (m) Education expense credit. Beginning with tax years 
3ending after
December 31, 1999, a taxpayer who
is the custodian 
4of one or more qualifying pupils shall be allowed a credit

5against the tax imposed by subsections (a) and (b) of this 
6Section for
qualified education expenses incurred on behalf of 
7the qualifying pupils.
The credit shall be equal to 25% of 
8qualified education expenses, but in no
event may the total 
9credit under this subsection claimed by a
family that is the

10custodian of qualifying pupils exceed $500. In no event shall a 
11credit under
this subsection reduce the taxpayer's liability 
12under this Act to less than
zero. This subsection is exempt 
13from the provisions of Section 250 of this
Act.
14 For purposes of this subsection:
15 "Qualifying pupils" means individuals who (i) are 
16residents of the State of
Illinois, (ii) are under the age of 
1721 at the close of the school year for
which a credit is 
18sought, and (iii) during the school year for which a credit
is 
19sought were full-time pupils enrolled in a kindergarten through 
20twelfth
grade education program at any school, as defined in 
21this subsection.
22 "Qualified education expense" means the amount incurred
on 
23behalf of a qualifying pupil in excess of $250 for tuition, 
24book fees, and
lab fees at the school in which the pupil is 
25enrolled during the regular school
year.
26 "School" means any public or nonpublic elementary or 
 
 
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1secondary school in
Illinois that is in compliance with Title 
2VI of the Civil Rights Act of 1964
and attendance at which 
3satisfies the requirements of Section 26-1 of the
School Code, 
4except that nothing shall be construed to require a child to

5attend any particular public or nonpublic school to qualify for 
6the credit
under this Section.
7 "Custodian" means, with respect to qualifying pupils, an 
8Illinois resident
who is a parent, the parents, a legal 
9guardian, or the legal guardians of the
qualifying pupils.
10 (n) River Edge Redevelopment Zone site remediation tax 
11credit.

12  (i) For tax years ending on or after December 31, 2006, 
13 a taxpayer shall be allowed a credit against the tax 
14 imposed by subsections (a) and (b) of this Section for 
15 certain amounts paid for unreimbursed eligible remediation 
16 costs, as specified in this subsection. For purposes of 
17 this Section, "unreimbursed eligible remediation costs" 
18 means costs approved by the Illinois Environmental 
19 Protection Agency ("Agency") under Section 58.14a of the 
20 Environmental Protection Act that were paid in performing 
21 environmental remediation at a site within a River Edge 
22 Redevelopment Zone for which a No Further Remediation 
23 Letter was issued by the Agency and recorded under Section 
24 58.10 of the Environmental Protection Act. The credit must 
25 be claimed for the taxable year in which Agency approval of 
26 the eligible remediation costs is granted. The credit is 
 
 
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1 not available to any taxpayer if the taxpayer or any 
2 related party caused or contributed to, in any material 
3 respect, a release of regulated substances on, in, or under 
4 the site that was identified and addressed by the remedial 
5 action pursuant to the Site Remediation Program of the 
6 Environmental Protection Act. Determinations as to credit 
7 availability for purposes of this Section shall be made 
8 consistent with rules adopted by the Pollution Control 
9 Board pursuant to the Illinois Administrative Procedure 
10 Act for the administration and enforcement of Section 58.9 
11 of the Environmental Protection Act. For purposes of this 
12 Section, "taxpayer" includes a person whose tax attributes 
13 the taxpayer has succeeded to under Section 381 of the 
14 Internal Revenue Code and "related party" includes the 
15 persons disallowed a deduction for losses by paragraphs 
16 (b), (c), and (f)(1) of Section 267 of the Internal Revenue 
17 Code by virtue of being a related taxpayer, as well as any 
18 of its partners. The credit allowed against the tax imposed 
19 by subsections (a) and (b) shall be equal to 25% of the 
20 unreimbursed eligible remediation costs in excess of 
21 $100,000 per site.
22  (ii) A credit allowed under this subsection that is 
23 unused in the year the credit is earned may be carried 
24 forward to each of the 5 taxable years following the year 
25 for which the credit is first earned until it is used. This 
26 credit shall be applied first to the earliest year for 
 
 
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1 which there is a liability. If there is a credit under this 
2 subsection from more than one tax year that is available to 
3 offset a liability, the earliest credit arising under this 
4 subsection shall be applied first. A credit allowed under 
5 this subsection may be sold to a buyer as part of a sale of 
6 all or part of the remediation site for which the credit 
7 was granted. The purchaser of a remediation site and the 
8 tax credit shall succeed to the unused credit and remaining 
9 carry-forward period of the seller. To perfect the 
10 transfer, the assignor shall record the transfer in the 
11 chain of title for the site and provide written notice to 
12 the Director of the Illinois Department of Revenue of the 
13 assignor's intent to sell the remediation site and the 
14 amount of the tax credit to be transferred as a portion of 
15 the sale. In no event may a credit be transferred to any 
16 taxpayer if the taxpayer or a related party would not be 
17 eligible under the provisions of subsection (i).
18  (iii) For purposes of this Section, the term "site" 
19 shall have the same meaning as under Section 58.2 of the 
20 Environmental Protection Act.
21(Source: P.A. 96-115, eff. 7-31-09; 96-116, eff. 7-31-09; 
2296-937, eff. 6-23-10; 96-1000, eff. 7-2-10; 96-1496, eff. 
231-13-11; 97-2, eff. 5-6-11; 97-636, eff. 6-1-12; 97-905, eff. 
248-7-12.)




25 (35 ILCS 5/303) (from Ch. 120, par. 3-303)



 
 
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1 Sec. 303. (a) In general. Any item of capital gain or loss, 
2and any
item of income from rents or royalties from real or 
3tangible personal
property, interest, dividends, and patent or 
4copyright royalties, and prizes
awarded under the Illinois 
5Lottery Law, and, for taxable years ending on or after December 
631, 2013, wagering and gambling winnings from Illinois sources 
7as set forth in subsection (e-1) of this Section, to the extent 
8such item constitutes
nonbusiness income, together with any 
9item of deduction directly allocable
thereto, shall be 
10allocated by any person other than a resident as provided
in 
11this Section.

12 (b) Capital gains and losses. 
13  (1) Real property. Capital gains and
losses from sales 
14 or exchanges of real property are allocable to this State

15 if the property is located in this State.

16  (2) Tangible personal property. Capital gains and 
17 losses from sales
or exchanges of tangible personal 
18 property are allocable to this State if,
at the time of 
19 such sale or exchange:

20   (A) The property had its situs in this State; or

21   (B) The taxpayer had its commercial domicile in 
22 this State and was not
taxable in the state in which 
23 the property had its situs.

24  (3) Intangibles. Capital gains and losses from sales or 
25 exchanges of
intangible personal property are allocable to 
26 this State if the taxpayer
had its commercial domicile in 
 
 
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1 this State at the time of such sale or
exchange.

2 (c) Rents and royalties.
3  (1) Real property. Rents and royalties
from real 
4 property are allocable to this State if the property is 
5 located
in this State.

6  (2) Tangible personal property. Rents and royalties 
7 from tangible
personal property are allocable to this 
8 State:

9   (A) If and to the extent that the property is 
10 utilized in this State; or

11   (B) In their entirety if, at the time such rents or 
12 royalties were paid
or accrued, the taxpayer had its 
13 commercial domicile in this State and was
not organized 
14 under the laws of or taxable with respect to such rents 
15 or
royalties in the state in which the property was 
16 utilized.
The extent of utilization of tangible 
17 personal property in a state is
determined by 
18 multiplying the rents or royalties derived from such 
19 property
by a fraction, the numerator of which is the 
20 number of days of physical
location of the property in 
21 the state during the rental or royalty period
in the 
22 taxable year and the denominator of which is the number 
23 of days of
physical location of the property everywhere 
24 during all rental or royalty
periods in the taxable 
25 year. If the physical location of the property
during 
26 the rental or royalty period is unknown or 
 
 
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1 unascertainable by the
taxpayer, tangible personal 
2 property is utilized in the state in which the
property 
3 was located at the time the rental or royalty payer 
4 obtained
possession.

5 (d) Patent and copyright royalties.

6  (1) Allocation. Patent and copyright royalties are 
7 allocable to this
State:

8   (A) If and to the extent that the patent or 
9 copyright is utilized by the
payer in this State; or

10   (B) If and to the extent that the patent or 
11 copyright is utilized by the
payer in a state in which 
12 the taxpayer is not taxable with respect to such

13 royalties and, at the time such royalties were paid or 
14 accrued, the
taxpayer had its commercial domicile in 
15 this State.

16  (2) Utilization.

17   (A) A patent is utilized in a state to the extent 
18 that it is employed in
production, fabrication, 
19 manufacturing or other processing in the state or
to 
20 the extent that a patented product is produced in the 
21 state. If the
basis of receipts from patent royalties 
22 does not permit allocation to
states or if the 
23 accounting procedures do not reflect states of

24 utilization, the patent is utilized in this State if 
25 the taxpayer has its
commercial domicile in this State.

26   (B) A copyright is utilized in a state to the 
 
 
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1 extent that printing or
other publication originates 
2 in the state. If the basis of receipts from
copyright 
3 royalties does not permit allocation to states or if 
4 the
accounting procedures do not reflect states of 
5 utilization, the copyright
is utilized in this State if 
6 the taxpayer has its commercial domicile in
this State.

7 (e) Illinois lottery prizes. Prizes awarded under the 
8"Illinois Lottery
Law", approved December 14, 1973, are 
9allocable to this State.

10 (e-1) Wagering and gambling winnings. Payments received in 
11taxable years ending on or after December 31, 2013 of winnings 
12from pari-mutuel wagering conducted at a wagering facility 
13licensed under the Illinois Horse Racing Act of 1975 and from 
14gambling games conducted on a riverboat or in a casino or 
15electronic gaming facility licensed under the Illinois 
16Gambling Act are allocable to this State. 
17 (e-5) Unemployment benefits. Unemployment benefits paid by 
18the Illinois Department of Employment Security are allocable to 
19this State. 
20 (f) Taxability in other state. For purposes of allocation 
21of income
pursuant to this Section, a taxpayer is taxable in 
22another state if:

23  (1) In that state he is subject to a net income tax, a 
24 franchise tax
measured by net income, a franchise tax for 
25 the privilege of doing
business, or a corporate stock tax; 
26 or

 
 
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1  (2) That state has jurisdiction to subject the taxpayer 
2 to a net income
tax regardless of whether, in fact, the 
3 state does or does not.

4 (g) Cross references. 
5  (1) For allocation of interest and dividends by
persons 
6 other than residents, see Section 301(c)(2).

7  (2) For allocation of nonbusiness income by residents, 
8 see Section
301(a).

9(Source: P.A. 97-709, eff. 7-1-12.)





10 (35 ILCS 5/304) (from Ch. 120, par. 3-304)


11 Sec. 304. Business income of persons other than residents. 

12 (a) In general. The business income of a person other than 
13a
resident shall be allocated to this State if such person's 
14business
income is derived solely from this State. If a person 
15other than a
resident derives business income from this State 
16and one or more other
states, then, for tax years ending on or 
17before December 30, 1998, and
except as otherwise provided by 
18this Section, such
person's business income shall be 
19apportioned to this State by
multiplying the income by a 
20fraction, the numerator of which is the sum
of the property 
21factor (if any), the payroll factor (if any) and 200% of the

22sales factor (if any), and the denominator of which is 4 
23reduced by the
number of factors other than the sales factor 
24which have a denominator
of zero and by an additional 2 if the 
25sales factor has a denominator of zero.
For tax years ending on 
 
 
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1or after December 31, 1998, and except as otherwise
provided by 
2this Section, persons other than
residents who derive business 
3income from this State and one or more other
states shall 
4compute their apportionment factor by weighting their 
5property,
payroll, and sales factors as provided in
subsection 
6(h) of this Section.

7 (1) Property factor.


8  (A) The property factor is a fraction, the numerator of 
9 which is the
average value of the person's real and 
10 tangible personal property owned
or rented and used in the 
11 trade or business in this State during the
taxable year and 
12 the denominator of which is the average value of all
the 
13 person's real and tangible personal property owned or 
14 rented and
used in the trade or business during the taxable 
15 year.


16  (B) Property owned by the person is valued at its 
17 original cost.
Property rented by the person is valued at 8 
18 times the net annual rental
rate. Net annual rental rate is 
19 the annual rental rate paid by the
person less any annual 
20 rental rate received by the person from
sub-rentals.


21  (C) The average value of property shall be determined 
22 by averaging
the values at the beginning and ending of the 
23 taxable year but the
Director may require the averaging of 
24 monthly values during the taxable
year if reasonably 
25 required to reflect properly the average value of the

26 person's property.

 
 
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1 (2) Payroll factor.


2  (A) The payroll factor is a fraction, the numerator of 
3 which is the
total amount paid in this State during the 
4 taxable year by the person
for compensation, and the 
5 denominator of which is the total compensation
paid 
6 everywhere during the taxable year.


7  (B) Compensation is paid in this State if:


8   (i) The individual's service is performed entirely 
9 within this
State;


10   (ii) The individual's service is performed both 
11 within and without
this State, but the service 
12 performed without this State is incidental
to the 
13 individual's service performed within this State; or


14   (iii) Some of the service is performed within this 
15 State and either
the base of operations, or if there is 
16 no base of operations, the place
from which the service 
17 is directed or controlled is within this State,
or the 
18 base of operations or the place from which the service 
19 is
directed or controlled is not in any state in which 
20 some part of the
service is performed, but the 
21 individual's residence is in this State.

22   (iv) Compensation paid to nonresident professional 
23 athletes.
24   (a) General. The Illinois source income of a 
25 nonresident individual who is a member of a 
26 professional athletic team includes the portion of the 
 
 
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1 individual's total compensation for services performed 
2 as a member of a professional athletic team during the 
3 taxable year which the number of duty days spent within 
4 this State performing services for the team in any 
5 manner during the taxable year bears to the total 
6 number of duty days spent both within and without this 
7 State during the taxable year.
8   (b) Travel days. Travel days that do not involve 
9 either a game, practice, team meeting, or other similar 
10 team event are not considered duty days spent in this 
11 State. However, such travel days are considered in the 
12 total duty days spent both within and without this 
13 State.
14   (c) Definitions. For purposes of this subpart 
15 (iv):
16    (1) The term "professional athletic team" 
17 includes, but is not limited to, any professional 
18 baseball, basketball, football, soccer, or hockey 
19 team.
20    (2) The term "member of a professional 
21 athletic team" includes those employees who are 
22 active players, players on the disabled list, and 
23 any other persons required to travel and who travel 
24 with and perform services on behalf of a 
25 professional athletic team on a regular basis. 
26 This includes, but is not limited to, coaches, 
 
 
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1 managers, and trainers.
2    (3) Except as provided in items (C) and (D) of 
3 this subpart (3), the term "duty days" means all 
4 days during the taxable year from the beginning of 
5 the professional athletic team's official 
6 pre-season training period through the last game 
7 in which the team competes or is scheduled to 
8 compete. Duty days shall be counted for the year in 
9 which they occur, including where a team's 
10 official pre-season training period through the 
11 last game in which the team competes or is 
12 scheduled to compete, occurs during more than one 
13 tax year.
14     (A) Duty days shall also include days on 
15 which a member of a professional athletic team 
16 performs service for a team on a date that does 
17 not fall within the foregoing period (e.g., 
18 participation in instructional leagues, the 
19 "All Star Game", or promotional "caravans"). 
20 Performing a service for a professional 
21 athletic team includes conducting training and 
22 rehabilitation activities, when such 
23 activities are conducted at team facilities.
24     (B) Also included in duty days are game 
25 days, practice days, days spent at team 
26 meetings, promotional caravans, preseason 
 
 
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1 training camps, and days served with the team 
2 through all post-season games in which the team 
3 competes or is scheduled to compete.
4     (C) Duty days for any person who joins a 
5 team during the period from the beginning of 
6 the professional athletic team's official 
7 pre-season training period through the last 
8 game in which the team competes, or is 
9 scheduled to compete, shall begin on the day 
10 that person joins the team. Conversely, duty 
11 days for any person who leaves a team during 
12 this period shall end on the day that person 
13 leaves the team. Where a person switches teams 
14 during a taxable year, a separate duty-day 
15 calculation shall be made for the period the 
16 person was with each team.
17     (D) Days for which a member of a 
18 professional athletic team is not compensated 
19 and is not performing services for the team in 
20 any manner, including days when such member of 
21 a professional athletic team has been 
22 suspended without pay and prohibited from 
23 performing any services for the team, shall not 
24 be treated as duty days.
25     (E) Days for which a member of a 
26 professional athletic team is on the disabled 
 
 
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1 list and does not conduct rehabilitation 
2 activities at facilities of the team, and is 
3 not otherwise performing services for the team 
4 in Illinois, shall not be considered duty days 
5 spent in this State. All days on the disabled 
6 list, however, are considered to be included in 
7 total duty days spent both within and without 
8 this State.
9    (4) The term "total compensation for services 
10 performed as a member of a professional athletic 
11 team" means the total compensation received during 
12 the taxable year for services performed:
13     (A) from the beginning of the official 
14 pre-season training period through the last 
15 game in which the team competes or is scheduled 
16 to compete during that taxable year; and
17     (B) during the taxable year on a date which 
18 does not fall within the foregoing period 
19 (e.g., participation in instructional leagues, 
20 the "All Star Game", or promotional caravans).
21    This compensation shall include, but is not 
22 limited to, salaries, wages, bonuses as described 
23 in this subpart, and any other type of compensation 
24 paid during the taxable year to a member of a 
25 professional athletic team for services performed 
26 in that year. This compensation does not include 
 
 
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1 strike benefits, severance pay, termination pay, 
2 contract or option year buy-out payments, 
3 expansion or relocation payments, or any other 
4 payments not related to services performed for the 
5 team.
6    For purposes of this subparagraph, "bonuses" 
7 included in "total compensation for services 
8 performed as a member of a professional athletic 
9 team" subject to the allocation described in 
10 Section 302(c)(1) are: bonuses earned as a result 
11 of play (i.e., performance bonuses) during the 
12 season, including bonuses paid for championship, 
13 playoff or "bowl" games played by a team, or for 
14 selection to all-star league or other honorary 
15 positions; and bonuses paid for signing a 
16 contract, unless the payment of the signing bonus 
17 is not conditional upon the signee playing any 
18 games for the team or performing any subsequent 
19 services for the team or even making the team, the 
20 signing bonus is payable separately from the 
21 salary and any other compensation, and the signing 
22 bonus is nonrefundable.


23 (3) Sales factor.


24  (A) The sales factor is a fraction, the numerator of 
25 which is the
total sales of the person in this State during 
26 the taxable year, and the
denominator of which is the total 
 
 
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1 sales of the person everywhere during
the taxable year.


2  (B) Sales of tangible personal property are in this 
3 State if:


4   (i) The property is delivered or shipped to a 
5 purchaser, other than
the United States government, 
6 within this State regardless of the f. o.
b. point or 
7 other conditions of the sale; or


8   (ii) The property is shipped from an office, store, 
9 warehouse,
factory or other place of storage in this 
10 State and either the purchaser
is the United States 
11 government or the person is not taxable in the
state of 
12 the purchaser; provided, however, that premises owned 
13 or leased
by a person who has independently contracted 
14 with the seller for the printing
of newspapers, 
15 periodicals or books shall not be deemed to be an 
16 office,
store, warehouse, factory or other place of 
17 storage for purposes of this
Section.
Sales of tangible 
18 personal property are not in this State if the
seller 
19 and purchaser would be members of the same unitary 
20 business group
but for the fact that either the seller 
21 or purchaser is a person with 80%
or more of total 
22 business activity outside of the United States and the

23 property is purchased for resale.


24  (B-1) Patents, copyrights, trademarks, and similar 
25 items of intangible
personal property.


26   (i) Gross receipts from the licensing, sale, or 
 
 
09800SB1739sam001- 182 -LRB098 10559 AMC 42403 a


1 other disposition of a
patent, copyright, trademark, 
2 or similar item of intangible personal property, other 
3 than gross receipts governed by paragraph (B-7) of this 
4 item (3),
are in this State to the extent the item is 
5 utilized in this State during the
year the gross 
6 receipts are included in gross income.


7   (ii) Place of utilization.


8    (I) A patent is utilized in a state to the 
9 extent that it is employed
in production, 
10 fabrication, manufacturing, or other processing in 
11 the state or
to the extent that a patented product 
12 is produced in the state. If a patent is
utilized 
13 in
more than one state, the extent to which it is 
14 utilized in any one state shall
be a fraction equal 
15 to the gross receipts of the licensee or purchaser 
16 from
sales or leases of items produced, 
17 fabricated, manufactured, or processed
within that 
18 state using the patent and of patented items 
19 produced within that
state, divided by the total of 
20 such gross receipts for all states in which the

21 patent is utilized.


22    (II) A copyright is utilized in a state to the 
23 extent that printing or
other publication 
24 originates in the state. If a copyright is utilized 
25 in more
than one state, the extent to which it is 
26 utilized in any one state shall be a
fraction equal 
 
 
09800SB1739sam001- 183 -LRB098 10559 AMC 42403 a


1 to the gross receipts from sales or licenses of 
2 materials
printed or published in that state 
3 divided by the total of such gross receipts
for all 
4 states in which the copyright is utilized.


5    (III) Trademarks and other items of intangible 
6 personal property
governed by this paragraph (B-1) 
7 are utilized in the state in which the
commercial 
8 domicile of the licensee or purchaser is located.


9   (iii) If the state of utilization of an item of 
10 property governed by
this paragraph (B-1) cannot be 
11 determined from the taxpayer's books and
records or 
12 from the books and records of any person related to the 
13 taxpayer
within the meaning of Section 267(b) of the 
14 Internal Revenue Code, 26 U.S.C.
267, the gross

15 receipts attributable to that item shall be excluded 
16 from both the numerator
and the denominator of the 
17 sales factor.


18  (B-2) Gross receipts from the license, sale, or other 
19 disposition of
patents, copyrights, trademarks, and 
20 similar items of intangible personal
property, other than 
21 gross receipts governed by paragraph (B-7) of this item 
22 (3), may be included in the numerator or denominator of the 
23 sales factor
only if gross receipts from licenses, sales, 
24 or other disposition of such items
comprise more than 50% 
25 of the taxpayer's total gross receipts included in gross

26 income during the tax year and during each of the 2 
 
 
09800SB1739sam001- 184 -LRB098 10559 AMC 42403 a


1 immediately preceding tax
years; provided that, when a 
2 taxpayer is a member of a unitary business group,
such 
3 determination shall be made on the basis of the gross 
4 receipts of the
entire unitary business group.

5  (B-5) For taxable years ending on or after December 31, 
6 2008, except as provided in subsections (ii) through (vii), 
7 receipts from the sale of telecommunications service or 
8 mobile telecommunications service are in this State if the 
9 customer's service address is in this State.
10   (i) For purposes of this subparagraph (B-5), the 
11 following terms have the following meanings:
12   "Ancillary services" means services that are 
13 associated with or incidental to the provision of 
14 "telecommunications services", including but not 
15 limited to "detailed telecommunications billing", 
16 "directory assistance", "vertical service", and "voice 
17 mail services".
18   "Air-to-Ground Radiotelephone service" means a 
19 radio service, as that term is defined in 47 CFR 22.99, 
20 in which common carriers are authorized to offer and 
21 provide radio telecommunications service for hire to 
22 subscribers in aircraft.
23   "Call-by-call Basis" means any method of charging 
24 for telecommunications services where the price is 
25 measured by individual calls.
26   "Communications Channel" means a physical or 
 
 
09800SB1739sam001- 185 -LRB098 10559 AMC 42403 a


1 virtual path of communications over which signals are 
2 transmitted between or among customer channel 
3 termination points.
4   "Conference bridging service" means an "ancillary 
5 service" that links two or more participants of an 
6 audio or video conference call and may include the 
7 provision of a telephone number. "Conference bridging 
8 service" does not include the "telecommunications 
9 services" used to reach the conference bridge.
10   "Customer Channel Termination Point" means the 
11 location where the customer either inputs or receives 
12 the communications.
13   "Detailed telecommunications billing service" 
14 means an "ancillary service" of separately stating 
15 information pertaining to individual calls on a 
16 customer's billing statement.
17   "Directory assistance" means an "ancillary 
18 service" of providing telephone number information, 
19 and/or address information.
20   "Home service provider" means the facilities based 
21 carrier or reseller with which the customer contracts 
22 for the provision of mobile telecommunications 
23 services.
24   "Mobile telecommunications service" means 
25 commercial mobile radio service, as defined in Section 
26 20.3 of Title 47 of the Code of Federal Regulations as 
 
 
09800SB1739sam001- 186 -LRB098 10559 AMC 42403 a


1 in effect on June 1, 1999.
2   "Place of primary use" means the street address 
3 representative of where the customer's use of the 
4 telecommunications service primarily occurs, which 
5 must be the residential street address or the primary 
6 business street address of the customer. In the case of 
7 mobile telecommunications services, "place of primary 
8 use" must be within the licensed service area of the 
9 home service provider.
10   "Post-paid telecommunication service" means the 
11 telecommunications service obtained by making a 
12 payment on a call-by-call basis either through the use 
13 of a credit card or payment mechanism such as a bank 
14 card, travel card, credit card, or debit card, or by 
15 charge made to a telephone number which is not 
16 associated with the origination or termination of the 
17 telecommunications service. A post-paid calling 
18 service includes telecommunications service, except a 
19 prepaid wireless calling service, that would be a 
20 prepaid calling service except it is not exclusively a 
21 telecommunication service.
22   "Prepaid telecommunication service" means the 
23 right to access exclusively telecommunications 
24 services, which must be paid for in advance and which 
25 enables the origination of calls using an access number 
26 or authorization code, whether manually or 
 
 
09800SB1739sam001- 187 -LRB098 10559 AMC 42403 a


1 electronically dialed, and that is sold in 
2 predetermined units or dollars of which the number 
3 declines with use in a known amount.
4   "Prepaid Mobile telecommunication service" means a 
5 telecommunications service that provides the right to 
6 utilize mobile wireless service as well as other 
7 non-telecommunication services, including but not 
8 limited to ancillary services, which must be paid for 
9 in advance that is sold in predetermined units or 
10 dollars of which the number declines with use in a 
11 known amount.
12   "Private communication service" means a 
13 telecommunication service that entitles the customer 
14 to exclusive or priority use of a communications 
15 channel or group of channels between or among 
16 termination points, regardless of the manner in which 
17 such channel or channels are connected, and includes 
18 switching capacity, extension lines, stations, and any 
19 other associated services that are provided in 
20 connection with the use of such channel or channels.
21   "Service address" means:
22    (a) The location of the telecommunications 
23 equipment to which a customer's call is charged and 
24 from which the call originates or terminates, 
25 regardless of where the call is billed or paid;
26    (b) If the location in line (a) is not known, 
 
 
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1 service address means the origination point of the 
2 signal of the telecommunications services first 
3 identified by either the seller's 
4 telecommunications system or in information 
5 received by the seller from its service provider 
6 where the system used to transport such signals is 
7 not that of the seller; and
8    (c) If the locations in line (a) and line (b) 
9 are not known, the service address means the 
10 location of the customer's place of primary use.
11   "Telecommunications service" means the electronic 
12 transmission, conveyance, or routing of voice, data, 
13 audio, video, or any other information or signals to a 
14 point, or between or among points. The term 
15 "telecommunications service" includes such 
16 transmission, conveyance, or routing in which computer 
17 processing applications are used to act on the form, 
18 code or protocol of the content for purposes of 
19 transmission, conveyance or routing without regard to 
20 whether such service is referred to as voice over 
21 Internet protocol services or is classified by the 
22 Federal Communications Commission as enhanced or value 
23 added. "Telecommunications service" does not include:
24    (a) Data processing and information services 
25 that allow data to be generated, acquired, stored, 
26 processed, or retrieved and delivered by an 
 
 
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1 electronic transmission to a purchaser when such 
2 purchaser's primary purpose for the underlying 
3 transaction is the processed data or information;
4    (b) Installation or maintenance of wiring or 
5 equipment on a customer's premises;
6    (c) Tangible personal property;
7    (d) Advertising, including but not limited to 
8 directory advertising.
9    (e) Billing and collection services provided 
10 to third parties;
11    (f) Internet access service;
12    (g) Radio and television audio and video 
13 programming services, regardless of the medium, 
14 including the furnishing of transmission, 
15 conveyance and routing of such services by the 
16 programming service provider. Radio and television 
17 audio and video programming services shall include 
18 but not be limited to cable service as defined in 
19 47 USC 522(6) and audio and video programming 
20 services delivered by commercial mobile radio 
21 service providers, as defined in 47 CFR 20.3;
22    (h) "Ancillary services"; or
23    (i) Digital products "delivered 
24 electronically", including but not limited to 
25 software, music, video, reading materials or ring 
26 tones.
 
 
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1   "Vertical service" means an "ancillary service" 
2 that is offered in connection with one or more 
3 "telecommunications services", which offers advanced 
4 calling features that allow customers to identify 
5 callers and to manage multiple calls and call 
6 connections, including "conference bridging services".
7   "Voice mail service" means an "ancillary service" 
8 that enables the customer to store, send or receive 
9 recorded messages. "Voice mail service" does not 
10 include any "vertical services" that the customer may 
11 be required to have in order to utilize the "voice mail 
12 service".
13   (ii) Receipts from the sale of telecommunications 
14 service sold on an individual call-by-call basis are in 
15 this State if either of the following applies:
16    (a) The call both originates and terminates in 
17 this State.
18    (b) The call either originates or terminates 
19 in this State and the service address is located in 
20 this State.
21   (iii) Receipts from the sale of postpaid 
22 telecommunications service at retail are in this State 
23 if the origination point of the telecommunication 
24 signal, as first identified by the service provider's 
25 telecommunication system or as identified by 
26 information received by the seller from its service 
 
 
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1 provider if the system used to transport 
2 telecommunication signals is not the seller's, is 
3 located in this State.
4   (iv) Receipts from the sale of prepaid 
5 telecommunications service or prepaid mobile 
6 telecommunications service at retail are in this State 
7 if the purchaser obtains the prepaid card or similar 
8 means of conveyance at a location in this State. 
9 Receipts from recharging a prepaid telecommunications 
10 service or mobile telecommunications service is in 
11 this State if the purchaser's billing information 
12 indicates a location in this State.
13   (v) Receipts from the sale of private 
14 communication services are in this State as follows:
15    (a) 100% of receipts from charges imposed at 
16 each channel termination point in this State.
17    (b) 100% of receipts from charges for the total 
18 channel mileage between each channel termination 
19 point in this State.
20    (c) 50% of the total receipts from charges for 
21 service segments when those segments are between 2 
22 customer channel termination points, 1 of which is 
23 located in this State and the other is located 
24 outside of this State, which segments are 
25 separately charged.
26    (d) The receipts from charges for service 
 
 
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1 segments with a channel termination point located 
2 in this State and in two or more other states, and 
3 which segments are not separately billed, are in 
4 this State based on a percentage determined by 
5 dividing the number of customer channel 
6 termination points in this State by the total 
7 number of customer channel termination points.
8   (vi) Receipts from charges for ancillary services 
9 for telecommunications service sold to customers at 
10 retail are in this State if the customer's primary 
11 place of use of telecommunications services associated 
12 with those ancillary services is in this State. If the 
13 seller of those ancillary services cannot determine 
14 where the associated telecommunications are located, 
15 then the ancillary services shall be based on the 
16 location of the purchaser. 
17   (vii) Receipts to access a carrier's network or 
18 from the sale of telecommunication services or 
19 ancillary services for resale are in this State as 
20 follows:
21    (a) 100% of the receipts from access fees 
22 attributable to intrastate telecommunications 
23 service that both originates and terminates in 
24 this State.
25    (b) 50% of the receipts from access fees 
26 attributable to interstate telecommunications 
 
 
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1 service if the interstate call either originates 
2 or terminates in this State.
3    (c) 100% of the receipts from interstate end 
4 user access line charges, if the customer's 
5 service address is in this State. As used in this 
6 subdivision, "interstate end user access line 
7 charges" includes, but is not limited to, the 
8 surcharge approved by the federal communications 
9 commission and levied pursuant to 47 CFR 69.
10    (d) Gross receipts from sales of 
11 telecommunication services or from ancillary 
12 services for telecommunications services sold to 
13 other telecommunication service providers for 
14 resale shall be sourced to this State using the 
15 apportionment concepts used for non-resale 
16 receipts of telecommunications services if the 
17 information is readily available to make that 
18 determination. If the information is not readily 
19 available, then the taxpayer may use any other 
20 reasonable and consistent method. 
21  (B-7) For taxable years ending on or after December 31, 
22 2008, receipts from the sale of broadcasting services are 
23 in this State if the broadcasting services are received in 
24 this State. For purposes of this paragraph (B-7), the 
25 following terms have the following meanings:
26   "Advertising revenue" means consideration received 
 
 
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1 by the taxpayer in exchange for broadcasting services 
2 or allowing the broadcasting of commercials or 
3 announcements in connection with the broadcasting of 
4 film or radio programming, from sponsorships of the 
5 programming, or from product placements in the 
6 programming.
7   "Audience factor" means the ratio that the 
8 audience or subscribers located in this State of a 
9 station, a network, or a cable system bears to the 
10 total audience or total subscribers for that station, 
11 network, or cable system. The audience factor for film 
12 or radio programming shall be determined by reference 
13 to the books and records of the taxpayer or by 
14 reference to published rating statistics provided the 
15 method used by the taxpayer is consistently used from 
16 year to year for this purpose and fairly represents the 
17 taxpayer's activity in this State.
18   "Broadcast" or "broadcasting" or "broadcasting 
19 services" means the transmission or provision of film 
20 or radio programming, whether through the public 
21 airwaves, by cable, by direct or indirect satellite 
22 transmission, or by any other means of communication, 
23 either through a station, a network, or a cable system.
24   "Film" or "film programming" means the broadcast 
25 on television of any and all performances, events, or 
26 productions, including but not limited to news, 
 
 
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1 sporting events, plays, stories, or other literary, 
2 commercial, educational, or artistic works, either 
3 live or through the use of video tape, disc, or any 
4 other type of format or medium. Each episode of a 
5 series of films produced for television shall 
6 constitute separate "film" notwithstanding that the 
7 series relates to the same principal subject and is 
8 produced during one or more tax periods.
9   "Radio" or "radio programming" means the broadcast 
10 on radio of any and all performances, events, or 
11 productions, including but not limited to news, 
12 sporting events, plays, stories, or other literary, 
13 commercial, educational, or artistic works, either 
14 live or through the use of an audio tape, disc, or any 
15 other format or medium. Each episode in a series of 
16 radio programming produced for radio broadcast shall 
17 constitute a separate "radio programming" 
18 notwithstanding that the series relates to the same 
19 principal subject and is produced during one or more 
20 tax periods.
21    (i) In the case of advertising revenue from 
22 broadcasting, the customer is the advertiser and 
23 the service is received in this State if the 
24 commercial domicile of the advertiser is in this 
25 State.
26    (ii) In the case where film or radio 
 
 
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1 programming is broadcast by a station, a network, 
2 or a cable system for a fee or other remuneration 
3 received from the recipient of the broadcast, the 
4 portion of the service that is received in this 
5 State is measured by the portion of the recipients 
6 of the broadcast located in this State. 
7 Accordingly, the fee or other remuneration for 
8 such service that is included in the Illinois 
9 numerator of the sales factor is the total of those 
10 fees or other remuneration received from 
11 recipients in Illinois. For purposes of this 
12 paragraph, a taxpayer may determine the location 
13 of the recipients of its broadcast using the 
14 address of the recipient shown in its contracts 
15 with the recipient or using the billing address of 
16 the recipient in the taxpayer's records.
17    (iii) In the case where film or radio 
18 programming is broadcast by a station, a network, 
19 or a cable system for a fee or other remuneration 
20 from the person providing the programming, the 
21 portion of the broadcast service that is received 
22 by such station, network, or cable system in this 
23 State is measured by the portion of recipients of 
24 the broadcast located in this State. Accordingly, 
25 the amount of revenue related to such an 
26 arrangement that is included in the Illinois 
 
 
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1 numerator of the sales factor is the total fee or 
2 other total remuneration from the person providing 
3 the programming related to that broadcast 
4 multiplied by the Illinois audience factor for 
5 that broadcast.
6    (iv) In the case where film or radio 
7 programming is provided by a taxpayer that is a 
8 network or station to a customer for broadcast in 
9 exchange for a fee or other remuneration from that 
10 customer the broadcasting service is received at 
11 the location of the office of the customer from 
12 which the services were ordered in the regular 
13 course of the customer's trade or business. 
14 Accordingly, in such a case the revenue derived by 
15 the taxpayer that is included in the taxpayer's 
16 Illinois numerator of the sales factor is the 
17 revenue from such customers who receive the 
18 broadcasting service in Illinois.
19    (v) In the case where film or radio programming 
20 is provided by a taxpayer that is not a network or 
21 station to another person for broadcasting in 
22 exchange for a fee or other remuneration from that 
23 person, the broadcasting service is received at 
24 the location of the office of the customer from 
25 which the services were ordered in the regular 
26 course of the customer's trade or business. 
 
 
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1 Accordingly, in such a case the revenue derived by 
2 the taxpayer that is included in the taxpayer's 
3 Illinois numerator of the sales factor is the 
4 revenue from such customers who receive the 
5 broadcasting service in Illinois.
6  (B-8) For taxable years ending on or after December 31, 
7 2013, gross receipts from winnings from pari-mutuel 
8 wagering conducted at a wagering facility licensed under 
9 the Illinois Horse Racing Act of 1975 or from winnings from 
10 gambling games conducted on a riverboat or in a casino or 
11 electronic gaming facility licensed under the Illinois 
12 Gambling Act are in this State. 

13  (C) For taxable years ending before December 31, 2008, 
14 sales, other than sales governed by paragraphs (B), (B-1), 
15 and (B-2), are in
this State if:


16   (i) The income-producing activity is performed in 
17 this State; or


18   (ii) The income-producing activity is performed 
19 both within and
without this State and a greater 
20 proportion of the income-producing
activity is 
21 performed within this State than without this State, 
22 based
on performance costs.

23  (C-5) For taxable years ending on or after December 31, 
24 2008, sales, other than sales governed by paragraphs (B), 
25 (B-1), (B-2), (B-5), and (B-7), are in this State if any of 
26 the following criteria are met:
 
 
09800SB1739sam001- 199 -LRB098 10559 AMC 42403 a


1   (i) Sales from the sale or lease of real property 
2 are in this State if the property is located in this 
3 State.
4   (ii) Sales from the lease or rental of tangible 
5 personal property are in this State if the property is 
6 located in this State during the rental period. Sales 
7 from the lease or rental of tangible personal property 
8 that is characteristically moving property, including, 
9 but not limited to, motor vehicles, rolling stock, 
10 aircraft, vessels, or mobile equipment are in this 
11 State to the extent that the property is used in this 
12 State.
13   (iii) In the case of interest, net gains (but not 
14 less than zero) and other items of income from 
15 intangible personal property, the sale is in this State 
16 if:
17    (a) in the case of a taxpayer who is a dealer 
18 in the item of intangible personal property within 
19 the meaning of Section 475 of the Internal Revenue 
20 Code, the income or gain is received from a 
21 customer in this State. For purposes of this 
22 subparagraph, a customer is in this State if the 
23 customer is an individual, trust or estate who is a 
24 resident of this State and, for all other 
25 customers, if the customer's commercial domicile 
26 is in this State. Unless the dealer has actual 
 
 
09800SB1739sam001- 200 -LRB098 10559 AMC 42403 a


1 knowledge of the residence or commercial domicile 
2 of a customer during a taxable year, the customer 
3 shall be deemed to be a customer in this State if 
4 the billing address of the customer, as shown in 
5 the records of the dealer, is in this State; or
6    (b) in all other cases, if the 
7 income-producing activity of the taxpayer is 
8 performed in this State or, if the 
9 income-producing activity of the taxpayer is 
10 performed both within and without this State, if a 
11 greater proportion of the income-producing 
12 activity of the taxpayer is performed within this 
13 State than in any other state, based on performance 
14 costs.
15   (iv) Sales of services are in this State if the 
16 services are received in this State. For the purposes 
17 of this section, gross receipts from the performance of 
18 services provided to a corporation, partnership, or 
19 trust may only be attributed to a state where that 
20 corporation, partnership, or trust has a fixed place of 
21 business. If the state where the services are received 
22 is not readily determinable or is a state where the 
23 corporation, partnership, or trust receiving the 
24 service does not have a fixed place of business, the 
25 services shall be deemed to be received at the location 
26 of the office of the customer from which the services 
 
 
09800SB1739sam001- 201 -LRB098 10559 AMC 42403 a


1 were ordered in the regular course of the customer's 
2 trade or business. If the ordering office cannot be 
3 determined, the services shall be deemed to be received 
4 at the office of the customer to which the services are 
5 billed. If the taxpayer is not taxable in the state in 
6 which the services are received, the sale must be 
7 excluded from both the numerator and the denominator of 
8 the sales factor. The Department shall adopt rules 
9 prescribing where specific types of service are 
10 received, including, but not limited to, publishing, 
11 and utility service.


12  (D) For taxable years ending on or after December 31, 
13 1995, the following
items of income shall not be included 
14 in the numerator or denominator of the
sales factor: 
15 dividends; amounts included under Section 78 of the 
16 Internal
Revenue Code; and Subpart F income as defined in 
17 Section 952 of the Internal
Revenue Code.
No inference 
18 shall be drawn from the enactment of this paragraph (D) in

19 construing this Section for taxable years ending before 
20 December 31, 1995.


21  (E) Paragraphs (B-1) and (B-2) shall apply to tax years 
22 ending on or
after December 31, 1999, provided that a 
23 taxpayer may elect to apply the
provisions of these 
24 paragraphs to prior tax years. Such election shall be made

25 in the form and manner prescribed by the Department, shall 
26 be irrevocable, and
shall apply to all tax years; provided 
 
 
09800SB1739sam001- 202 -LRB098 10559 AMC 42403 a


1 that, if a taxpayer's Illinois income
tax liability for any 
2 tax year, as assessed under Section 903 prior to January
1, 
3 1999, was computed in a manner contrary to the provisions 
4 of paragraphs
(B-1) or (B-2), no refund shall be payable to 
5 the taxpayer for that tax year to
the extent such refund is 
6 the result of applying the provisions of paragraph
(B-1) or 
7 (B-2) retroactively. In the case of a unitary business 
8 group, such
election shall apply to all members of such 
9 group for every tax year such group
is in existence, but 
10 shall not apply to any taxpayer for any period during
which 
11 that taxpayer is not a member of such group.

12 (b) Insurance companies.


13  (1) In general. Except as otherwise
provided by 
14 paragraph (2), business income of an insurance company for 
15 a
taxable year shall be apportioned to this State by 
16 multiplying such
income by a fraction, the numerator of 
17 which is the direct premiums
written for insurance upon 
18 property or risk in this State, and the
denominator of 
19 which is the direct premiums written for insurance upon

20 property or risk everywhere. For purposes of this 
21 subsection, the term
"direct premiums written" means the 
22 total amount of direct premiums
written, assessments and 
23 annuity considerations as reported for the
taxable year on 
24 the annual statement filed by the company with the
Illinois 
25 Director of Insurance in the form approved by the National

26 Convention of Insurance Commissioners
or such other form as 
 
 
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1 may be
prescribed in lieu thereof.


2  (2) Reinsurance. If the principal source of premiums 
3 written by an
insurance company consists of premiums for 
4 reinsurance accepted by it,
the business income of such 
5 company shall be apportioned to this State
by multiplying 
6 such income by a fraction, the numerator of which is the

7 sum of (i) direct premiums written for insurance upon 
8 property or risk
in this State, plus (ii) premiums written 
9 for reinsurance accepted in
respect of property or risk in 
10 this State, and the denominator of which
is the sum of 
11 (iii) direct premiums written for insurance upon property

12 or risk everywhere, plus (iv) premiums written for 
13 reinsurance accepted
in respect of property or risk 
14 everywhere. For purposes of this
paragraph, premiums 
15 written for reinsurance accepted in respect of
property or 
16 risk in this State, whether or not otherwise determinable,

17 may, at the election of the company, be determined on the 
18 basis of the
proportion which premiums written for 
19 reinsurance accepted from
companies commercially domiciled 
20 in Illinois bears to premiums written
for reinsurance 
21 accepted from all sources, or, alternatively, in the

22 proportion which the sum of the direct premiums written for 
23 insurance
upon property or risk in this State by each 
24 ceding company from which
reinsurance is accepted bears to 
25 the sum of the total direct premiums
written by each such 
26 ceding company for the taxable year. The election made by a 
 
 
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1 company under this paragraph for its first taxable year 
2 ending on or after December 31, 2011, shall be binding for 
3 that company for that taxable year and for all subsequent 
4 taxable years, and may be altered only with the written 
5 permission of the Department, which shall not be 
6 unreasonably withheld.

7 (c) Financial organizations.


8  (1) In general. For taxable years ending before 
9 December 31, 2008, business income of a financial

10 organization shall be apportioned to this State by 
11 multiplying such
income by a fraction, the numerator of 
12 which is its business income from
sources within this 
13 State, and the denominator of which is its business
income 
14 from all sources. For the purposes of this subsection, the

15 business income of a financial organization from sources 
16 within this
State is the sum of the amounts referred to in 
17 subparagraphs (A) through
(E) following, but excluding the 
18 adjusted income of an international banking
facility as 
19 determined in paragraph (2):


20   (A) Fees, commissions or other compensation for 
21 financial services
rendered within this State;


22   (B) Gross profits from trading in stocks, bonds or 
23 other securities
managed within this State;


24   (C) Dividends, and interest from Illinois 
25 customers, which are received
within this State;


26   (D) Interest charged to customers at places of 
 
 
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1 business maintained
within this State for carrying 
2 debit balances of margin accounts,
without deduction 
3 of any costs incurred in carrying such accounts; and


4   (E) Any other gross income resulting from the 
5 operation as a
financial organization within this 
6 State. In computing the amounts
referred to in 
7 paragraphs (A) through (E) of this subsection, any 
8 amount
received by a member of an affiliated group 
9 (determined under Section
1504(a) of the Internal 
10 Revenue Code but without reference to whether
any such 
11 corporation is an "includible corporation" under 
12 Section
1504(b) of the Internal Revenue Code) from 
13 another member of such group
shall be included only to 
14 the extent such amount exceeds expenses of the

15 recipient directly related thereto.


16  (2) International Banking Facility. For taxable years 
17 ending before December 31, 2008:


18   (A) Adjusted Income. The adjusted income of an 
19 international banking
facility is its income reduced 
20 by the amount of the floor amount.


21   (B) Floor Amount. The floor amount shall be the 
22 amount, if any,
determined
by multiplying the income of 
23 the international banking facility by a fraction,
not 
24 greater than one, which is determined as follows:


25    (i) The numerator shall be:


26    The average aggregate, determined on a 
 
 
09800SB1739sam001- 206 -LRB098 10559 AMC 42403 a


1 quarterly basis, of the
financial
organization's 
2 loans to banks in foreign countries, to foreign 
3 domiciled
borrowers (except where secured 
4 primarily by real estate) and to foreign

5 governments and other foreign official 
6 institutions, as reported for its
branches, 
7 agencies and offices within the state on its 
8 "Consolidated Report
of Condition", Schedule A, 
9 Lines 2.c., 5.b., and 7.a., which was filed with

10 the Federal Deposit Insurance Corporation and 
11 other regulatory authorities,
for the year 1980, 
12 minus


13    The average aggregate, determined on a 
14 quarterly basis, of such loans
(other
than loans of 
15 an international banking facility), as reported by 
16 the financial
institution for its branches, 
17 agencies and offices within the state, on
the 
18 corresponding Schedule and lines of the 
19 Consolidated Report of Condition
for the current 
20 taxable year, provided, however, that in no case 
21 shall the
amount determined in this clause (the 
22 subtrahend) exceed the amount determined
in the 
23 preceding clause (the minuend); and


24    (ii) the denominator shall be the average 
25 aggregate, determined on a
quarterly basis, of the 
26 international banking facility's loans to banks in

 
 
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1 foreign countries, to foreign domiciled borrowers 
2 (except where secured
primarily by real estate) 
3 and to foreign governments and other foreign

4 official institutions, which were recorded in its 
5 financial accounts for
the current taxable year.


6   (C) Change to Consolidated Report of Condition and 
7 in Qualification.
In the event the Consolidated Report 
8 of Condition which is filed with the
Federal Deposit 
9 Insurance Corporation and other regulatory authorities 
10 is
altered so that the information required for 
11 determining the floor amount
is not found on Schedule 
12 A, lines 2.c., 5.b. and 7.a., the financial
institution 
13 shall notify the Department and the Department may, by

14 regulations or otherwise, prescribe or authorize the 
15 use of an alternative
source for such information. The 
16 financial institution shall also notify
the Department 
17 should its international banking facility fail to 
18 qualify as
such, in whole or in part, or should there 
19 be any amendment or change to
the Consolidated Report 
20 of Condition, as originally filed, to the extent
such 
21 amendment or change alters the information used in 
22 determining the floor
amount.

23  (3) For taxable years ending on or after December 31, 
24 2008, the business income of a financial organization shall 
25 be apportioned to this State by multiplying such income by 
26 a fraction, the numerator of which is its gross receipts 
 
 
09800SB1739sam001- 208 -LRB098 10559 AMC 42403 a


1 from sources in this State or otherwise attributable to 
2 this State's marketplace and the denominator of which is 
3 its gross receipts everywhere during the taxable year. 
4 "Gross receipts" for purposes of this subparagraph (3) 
5 means gross income, including net taxable gain on 
6 disposition of assets, including securities and money 
7 market instruments, when derived from transactions and 
8 activities in the regular course of the financial 
9 organization's trade or business. The following examples 
10 are illustrative:

11   (i) Receipts from the lease or rental of real or 
12 tangible personal property are in this State if the 
13 property is located in this State during the rental 
14 period. Receipts from the lease or rental of tangible 
15 personal property that is characteristically moving 
16 property, including, but not limited to, motor 
17 vehicles, rolling stock, aircraft, vessels, or mobile 
18 equipment are from sources in this State to the extent 
19 that the property is used in this State.
20   (ii) Interest income, commissions, fees, gains on 
21 disposition, and other receipts from assets in the 
22 nature of loans that are secured primarily by real 
23 estate or tangible personal property are from sources 
24 in this State if the security is located in this State.
25   (iii) Interest income, commissions, fees, gains on 
26 disposition, and other receipts from consumer loans 
 
 
09800SB1739sam001- 209 -LRB098 10559 AMC 42403 a


1 that are not secured by real or tangible personal 
2 property are from sources in this State if the debtor 
3 is a resident of this State.
4   (iv) Interest income, commissions, fees, gains on 
5 disposition, and other receipts from commercial loans 
6 and installment obligations that are not secured by 
7 real or tangible personal property are from sources in 
8 this State if the proceeds of the loan are to be 
9 applied in this State. If it cannot be determined where 
10 the funds are to be applied, the income and receipts 
11 are from sources in this State if the office of the 
12 borrower from which the loan was negotiated in the 
13 regular course of business is located in this State. If 
14 the location of this office cannot be determined, the 
15 income and receipts shall be excluded from the 
16 numerator and denominator of the sales factor.

17   (v) Interest income, fees, gains on disposition, 
18 service charges, merchant discount income, and other 
19 receipts from credit card receivables are from sources 
20 in this State if the card charges are regularly billed 
21 to a customer in this State.
22   (vi) Receipts from the performance of services, 
23 including, but not limited to, fiduciary, advisory, 
24 and brokerage services, are in this State if the 
25 services are received in this State within the meaning 
26 of subparagraph (a)(3)(C-5)(iv) of this Section.
 
 
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1   (vii) Receipts from the issuance of travelers 
2 checks and money orders are from sources in this State 
3 if the checks and money orders are issued from a 
4 location within this State.
5   (viii) Receipts from investment assets and 
6 activities and trading assets and activities are 
7 included in the receipts factor as follows:
8    (1) Interest, dividends, net gains (but not 
9 less than zero) and other income from investment 
10 assets and activities from trading assets and 
11 activities shall be included in the receipts 
12 factor. Investment assets and activities and 
13 trading assets and activities include but are not 
14 limited to: investment securities; trading account 
15 assets; federal funds; securities purchased and 
16 sold under agreements to resell or repurchase; 
17 options; futures contracts; forward contracts; 
18 notional principal contracts such as swaps; 
19 equities; and foreign currency transactions. With 
20 respect to the investment and trading assets and 
21 activities described in subparagraphs (A) and (B) 
22 of this paragraph, the receipts factor shall 
23 include the amounts described in such 
24 subparagraphs.
25     (A) The receipts factor shall include the 
26 amount by which interest from federal funds 
 
 
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1 sold and securities purchased under resale 
2 agreements exceeds interest expense on federal 
3 funds purchased and securities sold under 
4 repurchase agreements.
5     (B) The receipts factor shall include the 
6 amount by which interest, dividends, gains and 
7 other income from trading assets and 
8 activities, including but not limited to 
9 assets and activities in the matched book, in 
10 the arbitrage book, and foreign currency 
11 transactions, exceed amounts paid in lieu of 
12 interest, amounts paid in lieu of dividends, 
13 and losses from such assets and activities.
14    (2) The numerator of the receipts factor 
15 includes interest, dividends, net gains (but not 
16 less than zero), and other income from investment 
17 assets and activities and from trading assets and 
18 activities described in paragraph (1) of this 
19 subsection that are attributable to this State.
20     (A) The amount of interest, dividends, net 
21 gains (but not less than zero), and other 
22 income from investment assets and activities 
23 in the investment account to be attributed to 
24 this State and included in the numerator is 
25 determined by multiplying all such income from 
26 such assets and activities by a fraction, the 
 
 
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1 numerator of which is the gross income from 
2 such assets and activities which are properly 
3 assigned to a fixed place of business of the 
4 taxpayer within this State and the denominator 
5 of which is the gross income from all such 
6 assets and activities.
7     (B) The amount of interest from federal 
8 funds sold and purchased and from securities 
9 purchased under resale agreements and 
10 securities sold under repurchase agreements 
11 attributable to this State and included in the 
12 numerator is determined by multiplying the 
13 amount described in subparagraph (A) of 
14 paragraph (1) of this subsection from such 
15 funds and such securities by a fraction, the 
16 numerator of which is the gross income from 
17 such funds and such securities which are 
18 properly assigned to a fixed place of business 
19 of the taxpayer within this State and the 
20 denominator of which is the gross income from 
21 all such funds and such securities.
22     (C) The amount of interest, dividends, 
23 gains, and other income from trading assets and 
24 activities, including but not limited to 
25 assets and activities in the matched book, in 
26 the arbitrage book and foreign currency 
 
 
09800SB1739sam001- 213 -LRB098 10559 AMC 42403 a


1 transactions (but excluding amounts described 
2 in subparagraphs (A) or (B) of this paragraph), 
3 attributable to this State and included in the 
4 numerator is determined by multiplying the 
5 amount described in subparagraph (B) of 
6 paragraph (1) of this subsection by a fraction, 
7 the numerator of which is the gross income from 
8 such trading assets and activities which are 
9 properly assigned to a fixed place of business 
10 of the taxpayer within this State and the 
11 denominator of which is the gross income from 
12 all such assets and activities.
13     (D) Properly assigned, for purposes of 
14 this paragraph (2) of this subsection, means 
15 the investment or trading asset or activity is 
16 assigned to the fixed place of business with 
17 which it has a preponderance of substantive 
18 contacts. An investment or trading asset or 
19 activity assigned by the taxpayer to a fixed 
20 place of business without the State shall be 
21 presumed to have been properly assigned if:
22      (i) the taxpayer has assigned, in the 
23 regular course of its business, such asset 
24 or activity on its records to a fixed place 
25 of business consistent with federal or 
26 state regulatory requirements;
 
 
09800SB1739sam001- 214 -LRB098 10559 AMC 42403 a


1      (ii) such assignment on its records is 
2 based upon substantive contacts of the 
3 asset or activity to such fixed place of 
4 business; and
5      (iii) the taxpayer uses such records 
6 reflecting assignment of such assets or 
7 activities for the filing of all state and 
8 local tax returns for which an assignment 
9 of such assets or activities to a fixed 
10 place of business is required.
11     (E) The presumption of proper assignment 
12 of an investment or trading asset or activity 
13 provided in subparagraph (D) of paragraph (2) 
14 of this subsection may be rebutted upon a 
15 showing by the Department, supported by a 
16 preponderance of the evidence, that the 
17 preponderance of substantive contacts 
18 regarding such asset or activity did not occur 
19 at the fixed place of business to which it was 
20 assigned on the taxpayer's records. If the 
21 fixed place of business that has a 
22 preponderance of substantive contacts cannot 
23 be determined for an investment or trading 
24 asset or activity to which the presumption in 
25 subparagraph (D) of paragraph (2) of this 
26 subsection does not apply or with respect to 
 
 
09800SB1739sam001- 215 -LRB098 10559 AMC 42403 a


1 which that presumption has been rebutted, that 
2 asset or activity is properly assigned to the 
3 state in which the taxpayer's commercial 
4 domicile is located. For purposes of this 
5 subparagraph (E), it shall be presumed, 
6 subject to rebuttal, that taxpayer's 
7 commercial domicile is in the state of the 
8 United States or the District of Columbia to 
9 which the greatest number of employees are 
10 regularly connected with the management of the 
11 investment or trading income or out of which 
12 they are working, irrespective of where the 
13 services of such employees are performed, as of 
14 the last day of the taxable year.

15  (4) (Blank).
16  (5) (Blank).
17 (c-1) Federally regulated exchanges. For taxable years 
18ending on or after December 31, 2012, business income of a 
19federally regulated exchange shall, at the option of the 
20federally regulated exchange, be apportioned to this State by 
21multiplying such income by a fraction, the numerator of which 
22is its business income from sources within this State, and the 
23denominator of which is its business income from all sources. 
24For purposes of this subsection, the business income within 
25this State of a federally regulated exchange is the sum of the 
26following: 
 
 
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1  (1) Receipts attributable to transactions executed on 
2 a physical trading floor if that physical trading floor is 
3 located in this State. 
4  (2) Receipts attributable to all other matching, 
5 execution, or clearing transactions, including without 
6 limitation receipts from the provision of matching, 
7 execution, or clearing services to another entity, 
8 multiplied by (i) for taxable years ending on or after 
9 December 31, 2012 but before December 31, 2013, 63.77%; and 
10 (ii) for taxable years ending on or after December 31, 
11 2013, 27.54%. 
12  (3) All other receipts not governed by subparagraphs 
13 (1) or (2) of this subsection (c-1), to the extent the 
14 receipts would be characterized as "sales in this State" 
15 under item (3) of subsection (a) of this Section. 
16 "Federally regulated exchange" means (i) a "registered 
17entity" within the meaning of 7 U.S.C. Section 1a(40)(A), (B), 
18or (C), (ii) an "exchange" or "clearing agency" within the 
19meaning of 15 U.S.C. Section 78c (a)(1) or (23), (iii) any such 
20entities regulated under any successor regulatory structure to 
21the foregoing, and (iv) all taxpayers who are members of the 
22same unitary business group as a federally regulated exchange, 
23determined without regard to the prohibition in Section 
241501(a)(27) of this Act against including in a unitary business 
25group taxpayers who are ordinarily required to apportion 
26business income under different subsections of this Section; 
 
 
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1provided that this subparagraph (iv) shall apply only if 50% or 
2more of the business receipts of the unitary business group 
3determined by application of this subparagraph (iv) for the 
4taxable year are attributable to the matching, execution, or 
5clearing of transactions conducted by an entity described in 
6subparagraph (i), (ii), or (iii) of this paragraph. 
7 In no event shall the Illinois apportionment percentage 
8computed in accordance with this subsection (c-1) for any 
9taxpayer for any tax year be less than the Illinois 
10apportionment percentage computed under this subsection (c-1) 
11for that taxpayer for the first full tax year ending on or 
12after December 31, 2013 for which this subsection (c-1) applied 
13to the taxpayer. 
14 (d) Transportation services. For taxable years ending 
15before December 31, 2008, business income derived from 
16furnishing
transportation services shall be apportioned to 
17this State in accordance
with paragraphs (1) and (2):


18  (1) Such business income (other than that derived from

19 transportation by pipeline) shall be apportioned to this 
20 State by
multiplying such income by a fraction, the 
21 numerator of which is the
revenue miles of the person in 
22 this State, and the denominator of which
is the revenue 
23 miles of the person everywhere. For purposes of this

24 paragraph, a revenue mile is the transportation of 1 
25 passenger or 1 net
ton of freight the distance of 1 mile 
26 for a consideration. Where a
person is engaged in the 
 
 
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1 transportation of both passengers and freight,
the 
2 fraction above referred to shall be determined by means of 
3 an
average of the passenger revenue mile fraction and the 
4 freight revenue
mile fraction, weighted to reflect the 
5 person's


6   (A) relative railway operating income from total 
7 passenger and total
freight service, as reported to the 
8 Interstate Commerce Commission, in
the case of 
9 transportation by railroad, and


10   (B) relative gross receipts from passenger and 
11 freight
transportation, in case of transportation 
12 other than by railroad.


13  (2) Such business income derived from transportation 
14 by pipeline
shall be apportioned to this State by 
15 multiplying such income by a
fraction, the numerator of 
16 which is the revenue miles of the person in
this State, and 
17 the denominator of which is the revenue miles of the
person 
18 everywhere. For the purposes of this paragraph, a revenue 
19 mile is
the transportation by pipeline of 1 barrel of oil, 
20 1,000 cubic feet of
gas, or of any specified quantity of 
21 any other substance, the distance
of 1 mile for a 
22 consideration.

23  (3) For taxable years ending on or after December 31, 
24 2008, business income derived from providing 
25 transportation services other than airline services shall 
26 be apportioned to this State by using a fraction, (a) the 
 
 
09800SB1739sam001- 219 -LRB098 10559 AMC 42403 a


1 numerator of which shall be (i) all receipts from any 
2 movement or shipment of people, goods, mail, oil, gas, or 
3 any other substance (other than by airline) that both 
4 originates and terminates in this State, plus (ii) that 
5 portion of the person's gross receipts from movements or 
6 shipments of people, goods, mail, oil, gas, or any other 
7 substance (other than by airline) that originates in one 
8 state or jurisdiction and terminates in another state or 
9 jurisdiction, that is determined by the ratio that the 
10 miles traveled in this State bears to total miles 
11 everywhere and (b) the denominator of which shall be all 
12 revenue derived from the movement or shipment of people, 
13 goods, mail, oil, gas, or any other substance (other than 
14 by airline). Where a taxpayer is engaged in the 
15 transportation of both passengers and freight, the 
16 fraction above referred to shall first be determined 
17 separately for passenger miles and freight miles. Then an 
18 average of the passenger miles fraction and the freight 
19 miles fraction shall be weighted to reflect the taxpayer's:
20   (A) relative railway operating income from total 
21 passenger and total freight service, as reported to the 
22 Surface Transportation Board, in the case of 
23 transportation by railroad; and

24   (B) relative gross receipts from passenger and 
25 freight transportation, in case of transportation 
26 other than by railroad.

 
 
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1  (4) For taxable years ending on or after December 31, 
2 2008, business income derived from furnishing airline

3 transportation services shall be apportioned to this State 
4 by
multiplying such income by a fraction, the numerator of 
5 which is the
revenue miles of the person in this State, and 
6 the denominator of which
is the revenue miles of the person 
7 everywhere. For purposes of this
paragraph, a revenue mile 
8 is the transportation of one passenger or one net
ton of 
9 freight the distance of one mile for a consideration. If a

10 person is engaged in the transportation of both passengers 
11 and freight,
the fraction above referred to shall be 
12 determined by means of an
average of the passenger revenue 
13 mile fraction and the freight revenue
mile fraction, 
14 weighted to reflect the person's relative gross receipts 
15 from passenger and freight
airline transportation.

16 (e) Combined apportionment. Where 2 or more persons are 
17engaged in
a unitary business as described in subsection 
18(a)(27) of
Section 1501,
a part of which is conducted in this 
19State by one or more members of the
group, the business income 
20attributable to this State by any such member
or members shall 
21be apportioned by means of the combined apportionment method.

22 (f) Alternative allocation. If the allocation and 
23apportionment
provisions of subsections (a) through (e) and of 
24subsection (h) do not
fairly represent the
extent of a person's 
25business activity in this State, the person may
petition for, 
26or the Director may, without a petition, permit or require, in 
 
 
09800SB1739sam001- 221 -LRB098 10559 AMC 42403 a


1respect of all or any part
of the person's business activity, 
2if reasonable:


3  (1) Separate accounting;


4  (2) The exclusion of any one or more factors;


5  (3) The inclusion of one or more additional factors 
6 which will
fairly represent the person's business 
7 activities in this State; or


8  (4) The employment of any other method to effectuate an 
9 equitable
allocation and apportionment of the person's 
10 business income.

11 (g) Cross reference. For allocation of business income by 
12residents,
see Section 301(a).

13 (h) For tax years ending on or after December 31, 1998, the 
14apportionment
factor of persons who apportion their business 
15income to this State under
subsection (a) shall be equal to:


16  (1) for tax years ending on or after December 31, 1998 
17 and before December
31, 1999, 16 2/3% of the property 
18 factor plus 16 2/3% of the payroll factor
plus
66 2/3% of 
19 the sales factor;


20  (2) for tax years ending on or after December 31, 1999 
21 and before December
31,
2000, 8 1/3% of the property factor 
22 plus 8 1/3% of the payroll factor plus 83
1/3%
of the sales 
23 factor;


24  (3) for tax years ending on or after December 31, 2000, 
25 the sales factor.

26If, in any tax year ending on or after December 31, 1998 and 
 
 
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1before December
31, 2000, the denominator of the payroll, 
2property, or sales factor is zero,
the apportionment
factor 
3computed in paragraph (1) or (2) of this subsection for that 
4year shall
be divided by an amount equal to 100% minus the 
5percentage weight given to each
factor whose denominator is 
6equal to zero.

7(Source: P.A. 96-763, eff. 8-25-09; 97-507, eff. 8-23-11; 
897-636, eff. 6-1-12.)





9 (35 ILCS 5/710) (from Ch. 120, par. 7-710)



10 Sec. 710. Withholding from lottery winnings. 
11 (a) In General. 
12  (1) Any person
making a payment to a resident or 
13 nonresident of winnings under the Illinois
Lottery Law and 
14 not required to withhold Illinois income tax from such 
15 payment
under Subsection (b) of Section 701 of this Act 
16 because those winnings are
not subject to Federal income 
17 tax withholding, must withhold Illinois income
tax from 
18 such payment at a rate equal to the percentage tax rate for 
19 individuals
provided in subsection (b) of Section 201, 
20 provided that withholding is
not required if such payment 
21 of winnings is less than $1,000.

22  (2) Any person making a payment after December 31, 2013 
23 to a resident or nonresident of
winnings from pari-mutuel 
24 wagering conducted at a wagering facility licensed under 
25 the Illinois Horse
Racing Act of 1975 or from gambling 
 
 
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1 games conducted on a riverboat or in a casino or electronic 
2 gaming
facility licensed under the Illinois Gambling Act 
3 must withhold Illinois income tax from such payment at a

4 rate equal to the percentage tax rate for individuals 
5 provided in subsection (b) of Section 201, provided that

6 the person making the payment is required to withhold under 
7 Section 3402(q) of the Internal Revenue Code. 
8 (b) Credit for taxes withheld. Any amount withheld under 
9Subsection (a)
shall be a credit against the Illinois income 
10tax liability of the person
to whom the payment of winnings was 
11made for the taxable year in which that
person incurred an 
12Illinois income tax liability with respect to those winnings.

13(Source: P.A. 85-731.)


14 Section 90-23. The Property Tax Code is amended by adding 
15Section 15-144 as follows:

16 (35 ILCS 200/15-144 new)
17 Sec. 15-144. Chicago Casino Development Authority. All 
18property owned by the Chicago Casino Development Authority is 
19exempt. Any property owned by the Chicago Casino Development 
20Authority and leased to any other entity is not exempt.

21 Section 90-24. The Illinois Municipal Code is amended by 
22adding Section 8-10-2.6 as follows:

 
 
09800SB1739sam001- 224 -LRB098 10559 AMC 42403 a


1 (65 ILCS 5/8-10-2.6 new)
2 Sec. 8-10-2.6. Chicago Casino Development Authority. 
3Except as otherwise provided in the Chicago Casino Development 
4Authority Act, this Division 10 applies to purchase orders and 
5contracts relating to the Chicago Casino Development 
6Authority.

7 Section 90-25. The Joliet Regional Port District Act is 
8amended by changing Section 5.1 as follows:




9 (70 ILCS 1825/5.1) (from Ch. 19, par. 255.1)



10 Sec. 5.1. Riverboat and casino gambling. Notwithstanding 
11any other provision of
this Act, the District may not regulate 
12the operation, conduct, or
navigation of any riverboat gambling 
13casino licensed under the Illinois Riverboat
Gambling Act, and 
14the District
may not license, tax, or otherwise levy any 
15assessment of any kind on
any riverboat gambling casino 
16licensed under the Illinois Riverboat Gambling Act. The
General 
17Assembly declares that the powers to regulate the operation,

18conduct, and navigation of riverboat gambling casinos and to 
19license, tax,
and levy assessments upon riverboat gambling 
20casinos are exclusive powers of
the State of Illinois and the 
21Illinois Gaming Board as provided in the
Illinois Riverboat 
22Gambling Act.

23(Source: P.A. 87-1175.)


 
 
09800SB1739sam001- 225 -LRB098 10559 AMC 42403 a


1 Section 90-30. The Consumer Installment Loan Act is amended 
2by changing Section 12.5 as follows:




3 (205 ILCS 670/12.5)



4 Sec. 12.5. Limited purpose branch. 

5 (a) Upon the written approval of the Director, a licensee 
6may maintain a
limited purpose branch for the sole purpose of 
7making loans as permitted by
this Act. A limited purpose branch 
8may include an automatic loan machine. No
other activity shall 
9be conducted at the site, including but not limited to,

10accepting payments, servicing the accounts, or collections.

11 (b) The licensee must submit an application for a limited 
12purpose branch to
the Director on forms prescribed by the 
13Director with an application fee of
$300. The approval for the 
14limited purpose branch must be renewed concurrently
with the 
15renewal of the licensee's license along with a renewal fee of 
16$300 for
the limited purpose branch.

17 (c) The books, accounts, records, and files of the limited 
18purpose branch's
transactions shall be maintained at the 
19licensee's licensed location. The
licensee shall notify the 
20Director of the licensed location at which the books,
accounts, 
21records, and files shall be maintained.

22 (d) The licensee shall prominently display at the limited 
23purpose branch the
address and telephone number of the 
24licensee's licensed location.

25 (e) No other business shall be conducted at the site of the 
 
 
09800SB1739sam001- 226 -LRB098 10559 AMC 42403 a


1limited purpose
branch unless authorized by the Director.

2 (f) The Director shall make and enforce reasonable rules 
3for the conduct of
a limited purpose branch.

4 (g) A limited purpose branch may not be located
within 
51,000 feet of a facility operated by an inter-track wagering 
6licensee or
an organization licensee subject to the Illinois 
7Horse Racing Act of 1975,
on a riverboat or in a casino subject 
8to
the Illinois Riverboat Gambling Act, or within 1,000 feet of 
9the location at which the
riverboat docks or within 1,000 feet 
10of a casino.

11(Source: P.A. 90-437, eff. 1-1-98.)


12 Section 90-35. The Illinois Horse Racing Act of 1975 is 
13amended by changing Sections 1.2, 3.11, 3.12, 6, 9, 15, 18, 19, 
1420, 21, 24, 25, 26, 27, 30, 30.5, 31, 31.1, 32.1, 36, 40, and 
1554.75 and by adding Sections 3.31, 3.32, 3.33, 3.35, 3.36, 
163.37, 34.3, 39.2, and 56 as follows:




17 (230 ILCS 5/1.2)



18 Sec. 1.2. Legislative intent. This Act is intended to 
19benefit the people of the State of Illinois by
encouraging the 
20breeding and production of race horses, assisting economic

21development and promoting Illinois tourism.
The General 
22Assembly finds and declares it to be the public policy
of the 
23State
of Illinois to:

24 (a) support and enhance Illinois' horse racing industry, 
 
 
09800SB1739sam001- 227 -LRB098 10559 AMC 42403 a


1which is a
significant
component within the agribusiness 
2industry;

3 (b) ensure that Illinois' horse racing industry remains 
4competitive with
neighboring states;

5 (c) stimulate growth within Illinois' horse racing 
6industry, thereby
encouraging
new investment and development 
7to produce additional tax revenues and to
create additional 
8jobs;

9 (d) promote the further growth of tourism;

10 (e) encourage the breeding of thoroughbred and 
11standardbred horses in this
State; and

12 (f) ensure that public confidence and trust in the 
13credibility and integrity
of
racing operations and the 
14regulatory process is maintained.

15(Source: P.A. 91-40, eff. 6-25-99.)





16 (230 ILCS 5/3.11) (from Ch. 8, par. 37-3.11)



17 Sec. 3.11. 
"Organization Licensee" means any person 
18receiving
an organization license from the Board to conduct a 
19race meeting or meetings. With respect only to electronic 
20gaming, "organization licensee" includes the authorization for 
21an electronic gaming license under subsection (a) of Section 56 
22of this Act. 

23(Source: P.A. 79-1185.)





24 (230 ILCS 5/3.12) (from Ch. 8, par. 37-3.12)


 
 
09800SB1739sam001- 228 -LRB098 10559 AMC 42403 a


1 Sec. 3.12. Pari-mutuel system of
wagering.
"Pari-mutuel 
2system of
wagering" means a form of wagering on the outcome of

3horse races in which
wagers are made in various
denominations 
4on a horse or horses
and
all wagers for each race are pooled 
5and held by a licensee
for distribution in a manner approved by 
6the Board. "Pari-mutuel system of wagering" shall not include 
7wagering on historic races. Wagers may be placed via any method 
8or at any location authorized under this Act.

9(Source: P.A. 96-762, eff. 8-25-09.)


10 (230 ILCS 5/3.31 new)
11 Sec. 3.31. Adjusted gross receipts. "Adjusted gross 
12receipts" means the gross receipts less winnings paid to 
13wagerers.

14 (230 ILCS 5/3.32 new)
15 Sec. 3.32. Gross receipts. "Gross receipts" means the total 
16amount of money exchanged for the purchase of chips, tokens, or 
17electronic cards by riverboat or casino patrons or electronic 
18gaming patrons.

19 (230 ILCS 5/3.33 new)
20 Sec. 3.33. Electronic gaming. "Electronic gaming" means 
21slot machine gambling, video game of chance gambling, or 
22gambling with electronic gambling games as defined in the 
23Illinois Gambling Act or defined by the Illinois Gaming Board 
 
 
09800SB1739sam001- 229 -LRB098 10559 AMC 42403 a


1that is conducted at a race track pursuant to an electronic 
2gaming license.

3 (230 ILCS 5/3.35 new)
4 Sec. 3.35. Electronic gaming license.  "Electronic gaming 
5license" means a license issued by the Illinois Gaming Board 
6under Section 7.6 of the Illinois Gambling Act authorizing 
7electronic gaming at an electronic gaming facility.

8 (230 ILCS 5/3.36 new)
9 Sec. 3.36. Electronic gaming facility. "Electronic gaming 
10facility" means that portion of an organization licensee's race 
11track facility at which electronic gaming is conducted.

12 (230 ILCS 5/3.37 new)
13 Sec. 3.37. Purse. "Purse" means the amount of money won by 
14the owner of any competitor in a race. For purposes of 
15calculating owners' awards and breeders' awards pursuant to 
16Sections 30, 30.5, and 31 of this Act, "purse" shall only 
17include the amount paid from the purse account of the 
18organization licensee, and does not include (i) any fees paid 
19by the owners of the horses nominated to, entered in, or 
20starting in a horse race meeting and any money added by the 
21organization licensee, and (ii) any purse supplements, stakes 
22and awards, and awards expended from the Illinois Thoroughbred 
23Breeders Fund, the Illinois Quarter Horse Breeders Fund, and 
 
 
09800SB1739sam001- 230 -LRB098 10559 AMC 42403 a


1the Illinois Standardbred Breeders Fund.




2 (230 ILCS 5/6) (from Ch. 8, par. 37-6)


3 Sec. 6. Restrictions on Board members.  
4 (a) No person shall be appointed a member of the Board or 
5continue to be a member of the Board if the person or any 
6member of their immediate family is a member of the Board of 
7Directors, employee, or financially interested in any of the 
8following: (i) any licensee or other person who has applied for 
9racing dates to the Board, or the operations thereof including, 
10but not limited to, concessions, data processing, track 
11maintenance, track security, and pari-mutuel operations, 
12located, scheduled or doing business within the State of 
13Illinois, (ii) any race horse competing at a meeting under the 
14Board's jurisdiction, or (iii) any licensee under the Illinois 
15Gambling Act. No person shall be appointed a member of the 
16Board or continue
to be
a member of the Board who is (or any 
17member of whose family is) a member of the
Board of Directors 
18of, or who is a person financially interested in, any
licensee 
19or other person who has applied for racing dates to the
Board, 
20or the operations thereof including, but not
limited to, 
21concessions, data
processing, track maintenance, track 
22security and pari-mutuel operations,
located, scheduled
or 
23doing business within the State of Illinois, or in any race 
24horse competing
at a meeting
under the Board's jurisdiction. No 
25Board member shall hold any other public
office for which he

 
 
09800SB1739sam001- 231 -LRB098 10559 AMC 42403 a


1shall receive compensation other than necessary travel or other 
2incidental
expenses. 

3 (b) No person shall be a member of the Board who is not of 
4good moral
character or who
has been convicted of, or is under 
5indictment for, a felony under the laws
of Illinois or any

6other state, or the United States.

7 (c) No member of the Board or employee shall engage in any 
8political activity.
9 For the purposes of this subsection (c):
10 "Political" means any activity in support of or in 
11connection with any campaign for State or local elective office 
12or any political organization, but does not include activities 
13(i) relating to the support or opposition of any executive, 
14legislative, or administrative action (as those terms are 
15defined in Section 2 of the Lobbyist Registration Act), (ii) 
16relating to collective bargaining, or (iii) that are otherwise 
17in furtherance of the person's official State duties or 
18governmental and public service functions.
19 "Political organization" means a party, committee, 
20association, fund, or other organization (whether or not 
21incorporated) that is required to file a statement of 
22organization with the State Board of Elections or county clerk 
23under Section 9-3 of the Election Code, but only with regard to 
24those activities that require filing with the State Board of 
25Elections or county clerk. 
26 (d) Board members and employees may not engage in 
 
 
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1communications or any activity that may cause or have the 
2appearance of causing a conflict of interest. A conflict of 
3interest exists if a situation influences or creates the 
4appearance that it may influence judgment or performance of 
5regulatory duties and responsibilities. This prohibition shall 
6extend to any act identified by Board action that, in the 
7judgment of the Board, could represent the potential for or the 
8appearance of a conflict of interest.
9 (e) Board members and employees may not accept any gift, 
10gratuity, service, compensation, travel, lodging, or thing of 
11value, with the exception of unsolicited items of an incidental 
12nature, from any person, corporation, limited liability 
13company, or entity doing business with the Board.
14 (f) A Board member or employee shall not use or attempt to 
15use his or her official position to secure, or attempt to 
16secure, any privilege, advantage, favor, or influence for 
17himself or herself or others. No Board member or employee, 
18within a period of one year immediately preceding nomination by 
19the Governor or employment, shall have been employed or 
20received compensation or fees for services from a person or 
21entity, or its parent or affiliate, that has engaged in 
22business with the Board, a licensee or a licensee under the 
23Illinois Gambling Act. In addition, all Board members and 
24employees are subject to the restrictions set forth in Section 
255-45 of the State Officials and Employees Ethics Act. 
26(Source: P.A. 89-16, eff. 5-30-95.)





 
 
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1 (230 ILCS 5/9) (from Ch. 8, par. 37-9)



2 Sec. 9. 
The Board shall have all powers necessary and 
3proper to fully and
effectively execute the provisions of this 
4Act, including, but not
limited to, the following:

5 (a) The Board is vested with jurisdiction and supervision 
6over all race
meetings in this State, over all licensees doing 
7business
in this
State, over all occupation licensees, and over 
8all persons on the
facilities of any licensee. Such 
9jurisdiction shall
include the power to issue licenses to the 
10Illinois Department of
Agriculture authorizing the pari-mutuel 
11system of wagering
on harness and Quarter Horse races held (1) 
12at the Illinois State Fair in
Sangamon County, and (2) at the 
13DuQuoin State Fair in Perry County. The
jurisdiction of the 
14Board shall also include the power to issue licenses to
county 
15fairs which are eligible to receive funds pursuant to the

16Agricultural Fair Act, as now or hereafter amended, or their 
17agents,
authorizing the pari-mutuel system of wagering on horse

18races
conducted at the county fairs receiving such licenses. 
19Such licenses shall be
governed by subsection (n) of this 
20Section.

21 Upon application, the Board shall issue a license to the 
22Illinois Department
of Agriculture to conduct harness and 
23Quarter Horse races at the Illinois State
Fair and at the 
24DuQuoin State Fairgrounds
during the scheduled dates of each 
25fair. The Board shall not require and the
Department of 
 
 
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1Agriculture shall be exempt from the requirements of Sections

215.3, 18 and 19, paragraphs (a)(2), (b), (c), (d), (e), (e-5), 
3(e-10), (f),
(g), and (h) of Section 20, and Sections 21, 24 
4and 25. The Board and the Department
of
Agriculture may extend 
5any or all of these exemptions to any contractor or
agent 
6engaged by the Department of Agriculture to conduct its race 
7meetings
when the Board determines that this would best serve 
8the public interest and
the interest of horse racing.

9 Notwithstanding any provision of law to the contrary, it 
10shall be lawful for
any licensee to operate pari-mutuel 
11wagering
or
contract with the Department of Agriculture to 
12operate pari-mutuel wagering at
the DuQuoin State Fairgrounds 
13or for the Department to enter into contracts
with a licensee, 
14employ its owners,
employees
or
agents and employ such other 
15occupation licensees as the Department deems
necessary in 
16connection with race meetings and wagerings.

17 (b) The Board is vested with the full power to promulgate 
18reasonable
rules and regulations for the purpose of 
19administering the provisions of
this Act and to prescribe 
20reasonable rules, regulations and conditions
under which all 
21horse race meetings or wagering in the State shall be

22conducted. Such reasonable rules and regulations are to provide 
23for the
prevention of practices detrimental to the public 
24interest and to promote the best
interests of horse racing and 
25to impose penalties for violations thereof.

26 (c) The Board, and any person or persons to whom it 
 
 
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1delegates
this power, is vested with the power to enter the 
2facilities and other places of business of any licensee to 
3determine whether there has been compliance with
the provisions 
4of this Act and its rules and regulations.

5 (d) The Board, and any person or persons to whom it 
6delegates this
power, is vested with the authority to 
7investigate alleged violations of
the provisions of this Act, 
8its reasonable rules and regulations, orders
and final 
9decisions; the Board shall take appropriate disciplinary 
10action
against any licensee or occupation licensee for 
11violation
thereof or
institute appropriate legal action for the 
12enforcement thereof.

13 (e) The Board, and any person or persons to whom it 
14delegates this power,
may eject or exclude from any race 
15meeting or
the facilities of any licensee, or any part
thereof, 
16any occupation licensee or any
other individual whose conduct 
17