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HB 3209

Relating to motor vehicles; providing for revenue raising that requires approval by a three-fifths majority.

2025 Regular Session Introduced by Jeff Golden and 5 co-sponsors

HB 3209 creates a time-limited pilot paying municipalities for property tax revenue lost due to State property exemptions, capped at $100M per year if funded.

In committee upon adjournment.
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Bill Summary · HB 3209

Summary — HB 3209 (104th General Assembly, 2025)

Status: Introduced Feb. 18–21, 2025; in committee upon adjournment (June 28, 2025).
Primary sponsor: Rep. Michael J. Coffey, Jr.

Purpose / Intent

HB 3209 creates a time‑limited pilot program through which the Illinois Department of Revenue (IDOR) would reimburse municipalities for property tax revenue lost because State‑owned property within their boundaries is tax‑exempt. The program is intended to partially compensate local governments for revenue impacts tied to State property exemptions.

Key provisions

  • Establishes the "Municipal Property Tax Relief Reimbursement Pilot Program" in a new Section 2505‑817 of the Department of Revenue Law.
  • Pilot period: applicable to State fiscal years beginning on or after July 1, 2026 and before July 1, 2031 (i.e., FY 2026‑27 through FY 2030‑31).
  • Subject to appropriation: payments are not automatic and depend on funds being appropriated by the General Assembly.
  • Reimbursement formula: for each eligible municipality, the amount equals the difference between (A) the property tax revenue that would have been levied and distributed to the municipality in a given taxable year if the State property had not been tax‑exempt, and (B) the actual property tax revenue collected and distributed to the municipality for that taxable year. ("Taxable year" is defined in the bill as the calendar year during which property taxes payable the next year are levied.)
  • Annual aggregate cap: total reimbursements for all municipalities/taxing districts in any calendar year may not exceed $100,000,000. If eligible reimbursements exceed $100,000,000, awards are reduced pro rata.
  • Application and administration: county clerks apply to IDOR on behalf of municipalities (county clerks must consolidate multiple municipal applications into a single filing). IDOR may audit submitted information, adopt implementing rules, and direct county distribution of payments.
  • Effective date: the Act takes effect upon becoming law.

Who is affected

  • Municipalities that contain or are partly located on State tax‑exempt property would be eligible for compensation for lost property tax revenue.
  • Counties (county clerks) have the administrative role of applying on behalf of municipalities and distributing funds as directed.
  • The Department of Revenue is responsible for program administration, audits, and rulemaking.
  • Other taxing districts may be indirectly affected insofar as the text references reimbursements/aggregate caps for "taxing districts" in places; the bill focuses reimbursement on municipalities but uses mixed terminology, which could affect interpretation.

Fiscal/administrative notes and timeline

  • Maximum potential annual outlay is $100 million but only if appropriated; actual payments depend on legislative appropriations and annual demand.
  • Pilot runs through State fiscal years that begin on/after July 1, 2026 and before July 1, 2031.
  • IDOR rulemaking and audit authority will guide program implementation; county clerk consolidation requirement centralizes applications.

Compiled from official sources — confirm details with the bill’s official record.

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