Section 565.110  Recapture and Reallocation of Recaptured Amounts

a)         If, during the term of an agreement, the taxpayer ceases operations at a project location that is the subject of the agreement with the intent to terminate operations in the State, the Department and the Department of Revenue shall recapture from the taxpayer the entire credit amount awarded under that agreement prior to the date the taxpayer ceases operations.

[35 ILCS 65/77- 40]

1)         If the Department determines that a taxpayer ceases operations at a project location that is the subject of that agreement with the intent to terminate operations in the State, the Director shall provide notice to the taxpayer of that determination and allow the taxpayer a hearing under the Illinois Administrative Procedure Act [5 ILCS 100]. Example of activities that evidence a cessation of operation at a project location with an intent to terminate operations in the State include, but are not limited to, Illinois Worker Adjustment and Retraining Notification Act (WARN) [820 ILCS 65] notices reflecting layoffs in excess of 65% of the full-time employees located at the project site, public announcements or other media reflecting an intent to relocate operations outside the State, or any other information the Department determines reflects an intent to discontinue operations at the project site.

2)         The Department shall notify a taxpayer in writing that it is subject to recapture. The notice shall include the reason for revocation and if requested, the date and location of a hearing to be held pursuant to 56 Ill. Adm. Code 2605 (Administrative Hearing Rules).

3)         Following a final determination following an administrative hearing, or the Director's determination if a hearing is not requested, that credits received pursuant to an agreement are subject to recapture, the Department will contact the Director of the Illinois Department of Revenue who may initiate proceedings to determine the amounts to be reallocated by the Department pursuant to Section 77-40 of the Act.

b)         The Department shall, subject to appropriation, reallocate the recaptured amounts within 6 months of the appropriation to the local workforce investment area in which the project was located for purposes of workforce development, expanded opportunities for unemployed persons, and expanded opportunities for women and minority persons in the workforce in accordance with the Grant Accountability and Transparency Act (30 ILCS 708). [35 ILCS 65/77-40]

1)         Any county, municipality, or other entity may apply for a grant from the Department under this Section for the purposes of workforce development, expanded opportunities for unemployed persons, and expanded opportunities for women and minorities in the workforce in the local workforce investment area.

2)         An application must be submitted on the standard application form provided by the Department specifically setting forth how grant-related activities would directly support workforce development, expanded opportunities for unemployed persons, and expanded opportunities for women and minorities in the workforce in the local workforce investment area.

3)         The Department will evaluate applications based on the extent to which the grant applicant demonstrates that the proposed grant-related activities will directly support the purposes of this Section.

4)         Grant applicants shall be notified in writing as to the Department's evaluation of all completed grant applications. If the Department denies a grant application, it will specify the reasons for the denial in writing and allow the grant applicant 30 days to amend and resubmit its application for evaluation.

5)         The Department shall determine the amount of funds awarded to any grant applicant under this Section, based on the recapture amount, the number of other eligible applications, and factors including but not limited to:

A)        The applicant's documentation of need for the project;

B)        The applicant's capacity and qualifications to execute the project;

C)        The quality of the applicant's proposed project design and implementation; and

D)        The cost effectiveness of the applicant's proposed project.

6)         Upon approval of a grant application, the Department shall enter into a grant agreement with the grant applicant in accordance with the Grant Accountability and Transparency Act (GATA) [30 ILCS 708], containing such terms and conditions as the Department deems necessary and proper to effect the purposes of the Act.

c)         The taxpayer will be ineligible for future funding under other State tax credit or exemption programs for a 36-month period.  Noncompliance with the agreement will result in a default of other agreements for State tax credits and exemption programs for the project. [35 ILCS 65/77-40]