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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB3032

Introduced 1/28/2026, by Sen. Celina Villanueva

SYNOPSIS AS INTRODUCED:

35 ILCS 5/214
35 ILCS 5/223
35 ILCS 5/240
820 ILCS 130/2

Amends the Illinois Income Tax Act. Provides that projects funded in
whole or part with proceeds of certain transferable tax credits are
considered public works within the meaning of the Prevailing Wage Act.
Amends the Prevailing Wage Act. Provides that "public works" includes
projects financed in whole or part with, among other things, funds
received from the sale or transfer of tax credits awarded by the State,
other than tax credits awarded under the Film Production Services Tax
Credit Act of 2008 or the Live Theater Production Tax Credit Act. Effective
immediately.
LRB104 16574 TRT 29973 b

A BILL FOR

SB3032
LRB104 16574 TRT 29973 b
1

AN ACT concerning revenue.

2

Be it enacted by the People of the State of Illinois,
3
represented in the General Assembly:

4

Section 5.
The Illinois Income Tax Act is amended by
5
changing Sections 214, 223, and 240 as follows:

6

(35 ILCS 5/214)
7

Sec. 214.
Tax credit for affordable housing donations.
8

(a) Beginning with taxable years ending on or after
9
December 31, 2001 and until the taxable year ending on
10
December 31, 2026, a taxpayer who makes a donation under
11
Section 7.28 of the Illinois Housing Development Act is
12
entitled to a credit against the tax imposed by subsections
13
(a) and (b) of Section 201 in an amount equal to 50% of the
14
value of the donation. For taxable years ending before
15
December 31, 2023, partners, shareholders of subchapter S
16
corporations, and owners of limited liability companies (if
17
the limited liability company is treated as a partnership for
18
purposes of federal and State income taxation) are entitled to
19
a credit under this Section to be determined in accordance
20
with the determination of income and distributive share of
21
income under Sections 702 and 703 and subchapter S of the
22
Internal Revenue Code. For taxable years ending on or after
23
December 31, 2023, partners and shareholders of subchapter S

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1
corporations are entitled to a credit under this Section as
2
provided in Section 251. Persons or entities not subject to
3
the tax imposed by subsections (a) and (b) of Section 201 and
4
who make a donation under Section 7.28 of the Illinois Housing
5
Development Act are entitled to a credit as described in this
6
subsection and may transfer that credit as described in
7
subsection (c).
8

(b) If the amount of the credit exceeds the tax liability
9
for the year, the excess may be carried forward and applied to
10
the tax liability of the 5 taxable years following the excess
11
credit year. The tax credit shall be applied to the earliest
12
year for which there is a tax liability. If there are credits
13
for more than one year that are available to offset a
14
liability, the earlier credit shall be applied first.
15

(c) The transfer of the tax credit allowed under this
16
Section may be made (i) to the purchaser of land that has been
17
designated solely for affordable housing projects in
18
accordance with the Illinois Housing Development Act or (ii)
19
to another donor who has also made a donation in accordance
20
with Section 7.28 of the Illinois Housing Development Act.
21
Projects funded in whole or in part by the proceeds of tax
22
credits transferred pursuant to this subsection shall be
23
considered public works within the meaning of the Prevailing
24
Wage Act.

25

(d) A taxpayer claiming the credit provided by this
26
Section must maintain and record any information that the

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1
Department may require by regulation regarding the project for
2
which the credit is claimed. When claiming the credit provided
3
by this Section, the taxpayer must provide information
4
regarding the taxpayer's donation to the project under the
5
Illinois Housing Development Act.
6
(Source: P.A. 102-16, eff. 6-17-21; 102-175, eff. 7-29-21;
7
103-396, eff. 1-1-24
.)

8

(35 ILCS 5/223)
9

Sec. 223.
Hospital credit.

10

(a) For tax years ending on or after December 31, 2012 and
11
ending on or before December 31, 2027, a taxpayer that is the
12
owner of a hospital licensed under the Hospital Licensing Act,
13
but not including an organization that is exempt from federal
14
income taxes under the Internal Revenue Code, is entitled to a
15
credit against the taxes imposed under subsections (a) and (b)
16
of Section 201 of this Act in an amount equal to the lesser of
17
the amount of real property taxes paid during the tax year on
18
real property used for hospital purposes during the prior tax
19
year or the cost of free or discounted services provided
20
during the tax year pursuant to the hospital's charitable
21
financial assistance policy, measured at cost.
22

(b) If the taxpayer is a partnership or Subchapter S
23
corporation, the credit is allowed to the partners or
24
shareholders in accordance with the determination of income
25
and distributive share of income under Sections 702 and 704

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LRB104 16574 TRT 29973 b
1
and Subchapter S of the Internal Revenue Code. A transfer of
2
this credit may be made by the taxpayer earning the credit
3
within one year after the credit is earned in accordance with
4
rules adopted by the Department.
Projects funded in whole or
5
in part by the proceeds of tax credits transferred pursuant to
6
this subsection shall be considered public works within the
7
meaning of the Prevailing Wage Act.
The Department shall
8
prescribe rules to enforce and administer provisions of this
9
Section. If the amount of the credit exceeds the tax liability
10
for the year, then the excess credit may be carried forward and
11
applied to the tax liability of the 5 taxable years following
12
the excess credit year. The credit shall be applied to the
13
earliest year for which there is a tax liability. If there are
14
credits from more than one tax year that are available to
15
offset a liability, the earlier credit shall be applied first.
16
In no event shall a credit under this Section reduce the
17
taxpayer's liability to less than zero.
18
(Source: P.A. 102-700, eff. 4-19-22; 102-886, eff. 5-17-22.)

19

(35 ILCS 5/240)
20

Sec. 240.
Hydrogen fuel replacement tax credits.
21

(a) For tax years ending on or after December 31, 2027 and
22
beginning before January 1, 2029, an eligible taxpayer who
23
qualifies for a credit under the Hydrogen Fuel Replacement Tax
24
Credit Act is entitled to a credit against the taxes imposed
25
under subsections (a) and (b) of Section 201 of this Act as

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1
provided in that Act. If the eligible taxpayer is a
2
partnership or Subchapter S corporation, the credit shall be
3
allowed to the partners or shareholders in accordance with the
4
determination of income and distributive share of income under
5
Sections 702 and 704 and Subchapter S of the Internal Revenue
6
Code.
7

(b) If the amount of the credit exceeds the tax liability
8
for the year, the excess may be carried forward and applied to
9
the tax liability of the 5 taxable years following the excess
10
credit year. The credit shall be applied to the earliest year
11
for which there is a tax liability. If there are credits from
12
more than one tax year that are available to offset a
13
liability, the earlier credit shall be applied first. In no
14
event shall a credit under this Section reduce the taxpayer's
15
liability to less than zero.
16

(c) A sale, assignment, or transfer of the tax credit may
17
be made by the taxpayer earning the credit within one year
18
after the credit is awarded in accordance with rules adopted
19
by the Department of Commerce and Economic Opportunity.
20
Projects funded in whole or in part by the proceeds of tax
21
credits transferred pursuant to this subsection shall be
22
considered public works within the meaning of the Prevailing
23
Wage Act.

24

(d) A person claiming the credit allowed under this
25
Section shall attach to its Illinois income tax return a copy
26
of the tax credit certificate or the transfer certificate

SB3032
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LRB104 16574 TRT 29973 b
1
issued by the Department of Commerce and Economic Opportunity.
2
(Source: P.A. 103-268, eff. 7-25-23.)

3

Section 20.
The Prevailing Wage Act is amended by changing
4
Section 2 as follows:

5

(820 ILCS 130/2)
6

Sec. 2.
This Act applies to the wages of laborers,
7
mechanics
,
and other workers employed in any public works, as
8
hereinafter defined, by any public body and to anyone under
9
contracts for public works. This includes any maintenance,
10
repair, assembly, or disassembly work performed on equipment
11
whether owned, leased, or rented.
12

As used in this Act, unless the context indicates
13
otherwise:
14

"Public works" means all fixed works constructed or
15
demolished by any public body, or paid for wholly or in part
16
out of public funds. "Public works" as defined herein includes
17
all projects financed in whole or in part with bonds, grants,
18
loans, or other funds made available by or through the State or
19
any of its political subdivisions, including
,
but not limited
20
to: bonds issued under the Industrial Project Revenue Bond Act
21
(Article 11, Division 74 of the Illinois Municipal Code), the
22
Industrial Building Revenue Bond Act, the Illinois Finance
23
Authority Act, the Illinois Sports Facilities Authority Act,
24
or the Build Illinois Bond Act; loans or other funds made

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1
available pursuant to the Build Illinois Act; loans or other
2
funds made available pursuant to the Riverfront Development
3
Fund under Section 10-15 of the River Edge Redevelopment Zone
4
Act;
funds received from the sale or transfer of tax credits
5
awarded by the State, other than tax credits awarded under the
6
Film Production Services Tax Credit Act of 2008 or the Live
7
Theater Production Tax Credit Act;
or funds from the Fund for
8
Illinois' Future under Section 6z-47 of the State Finance Act,
9
funds for school construction under Section 5 of the General
10
Obligation Bond Act, funds authorized under Section 3 of the
11
School Construction Bond Act, funds for school infrastructure
12
under Section 6z-45 of the State Finance Act, and funds for
13
transportation purposes under Section 4 of the General
14
Obligation Bond Act. "Public works" also includes all federal
15
construction projects administered or controlled by a public
16
body if the prevailing rate of wages is equal to or greater
17
than the prevailing wage determination by the United States
18
Secretary of Labor for the same locality for the same type of
19
construction used to classify the federal construction
20
project. "Public works" also includes (i) all projects
21
financed in whole or in part with funds from the Environmental
22
Protection Agency under the Illinois Renewable Fuels
23
Development Program Act for which there is no project labor
24
agreement; (ii) all work performed pursuant to a public
25
private agreement under the Public Private Agreements for the
26
Illiana Expressway Act or the Public-Private Agreements for

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the South Suburban Airport Act; (iii) all projects undertaken
2
under a public-private agreement under the Public-Private
3
Partnerships for Transportation Act or the Department of
4
Natural Resources World Shooting and Recreational Complex Act;
5
and (iv) all transportation facilities undertaken under a
6
design-build contract or a Construction Manager/General
7
Contractor contract under the Innovations for Transportation
8
Infrastructure Act. "Public works" also includes all projects
9
at leased facility property used for airport purposes under
10
Section 35 of the Local Government Facility Lease Act. "Public
11
works" also includes the construction of a new wind power
12
facility by a business designated as a High Impact Business
13
under Section 5.5(a)(3)(E) of the Illinois Enterprise Zone
14
Act, the construction of a new utility-scale solar power
15
facility by a business designated as a High Impact Business
16
under Section 5.5(a)(3)(E-5) of the Illinois Enterprise Zone
17
Act, the construction of a new battery energy storage solution
18
facility by a business designated as a High Impact Business
19
under Section 5.5(a)(3)(I) of the Illinois Enterprise Zone
20
Act, and the construction of a high voltage direct current
21
converter station by a business designated as a High Impact
22
Business under Section 5.5(a)(3)(J) of the Illinois Enterprise
23
Zone Act. "Public works" also includes electric vehicle
24
charging station projects financed pursuant to the Electric
25
Vehicle Act and renewable energy projects required to pay the
26
prevailing wage pursuant to the Illinois Power Agency Act.

SB3032
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LRB104 16574 TRT 29973 b
1
"Public works" also includes power washing projects by a
2
public body or paid for wholly or in part out of public funds
3
in which steam or pressurized water, with or without added
4
abrasives or chemicals, is used to remove paint or other
5
coatings, oils or grease, corrosion, or debris from a surface
6
or to prepare a surface for a coating. "Public works" also
7
includes all electric transmission systems projects subject to
8
the Electric Transmission Systems Construction Standards Act.
9
"Public works" does not include work done directly by any
10
public utility company, whether or not done under public
11
supervision or direction, or paid for wholly or in part out of
12
public funds. "Public works" also includes construction
13
projects performed by a third party contracted by any public
14
utility, as described in subsection (a) of Section 2.1, in
15
public rights-of-way, as defined in Section 21-201 of the
16
Public Utilities Act, whether or not done under public
17
supervision or direction, or paid for wholly or in part out of
18
public funds. "Public works" also includes construction
19
projects that exceed 15 aggregate miles of new fiber optic
20
cable, performed by a third party contracted by any public
21
utility, as described in subsection (b) of Section 2.1, in
22
public rights-of-way, as defined in Section 21-201 of the
23
Public Utilities Act, whether or not done under public
24
supervision or direction, or paid for wholly or in part out of
25
public funds. "Public works" also includes any corrective
26
action performed pursuant to Title XVI of the Environmental

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LRB104 16574 TRT 29973 b
1
Protection Act for which payment from the Underground Storage
2
Tank Fund is requested. "Public works" also includes all
3
construction projects involving fixtures or permanent
4
attachments affixed to light poles that are owned by a public
5
body, including street light poles, traffic light poles, and
6
other lighting fixtures, whether or not done under public
7
supervision or direction, or paid for wholly or in part out of
8
public funds, unless the project is performed by employees
9
employed directly by the public body. "Public works" also
10
includes work performed subject to the Mechanical Insulation
11
Energy and Safety Assessment Act. "Public works" also includes
12
the removal, hauling, and transportation of biosolids, lime
13
sludge, and lime residue from a water treatment plant or
14
facility and the disposal of biosolids, lime sludge, and lime
15
residue removed from a water treatment plant or facility at a
16
landfill. "Public works" also includes sewer inspection
17
projects that use a closed-circuit television to identify
18
issues in a sewer system, such as cracks in pipes, root
19
intrusion, blockages, or other structural damage. "Public
20
works" does not include projects undertaken by the owner at an
21
owner-occupied single-family residence or at an owner-occupied
22
unit of a multi-family residence. "Public works" does not
23
include work performed for soil and water conservation
24
purposes on agricultural lands, whether or not done under
25
public supervision or paid for wholly or in part out of public
26
funds, done directly by an owner or person who has legal

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LRB104 16574 TRT 29973 b
1
control of those lands.
2

"Construction" means all work on public works involving
3
laborers, workers or mechanics. This includes any maintenance,
4
repair, assembly, or disassembly work performed on equipment
5
whether owned, leased, or rented.
6

"Locality" means the county where the physical work upon
7
public works is performed, except (1) that if there is not
8
available in the county a sufficient number of competent
9
skilled laborers, workers and mechanics to construct the
10
public works efficiently and properly, "locality" includes any
11
other county nearest the one in which the work or construction
12
is to be performed and from which such persons may be obtained
13
in sufficient numbers to perform the work and (2) that, with
14
respect to contracts for highway work with the Department of
15
Transportation of this State, "locality" may at the discretion
16
of the Secretary of the Department of Transportation be
17
construed to include two or more adjacent counties from which
18
workers may be accessible for work on such construction.
19

"Public body" means the State or any officer, board or
20
commission of the State or any political subdivision or
21
department thereof, or any institution supported in whole or
22
in part by public funds, and includes every county, city,
23
town, village, township, school district, irrigation, utility,
24
reclamation improvement or other district and every other
25
political subdivision, district or municipality of the state
26
whether such political subdivision, municipality or district

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LRB104 16574 TRT 29973 b
1
operates under a special charter or not.
2

"Labor organization" means an organization that is the
3
exclusive representative of an employer's employees recognized
4
or certified pursuant to the National Labor Relations Act.
5

The terms "general prevailing rate of hourly wages",
6
"general prevailing rate of wages" or "prevailing rate of
7
wages" when used in this Act mean the hourly cash wages plus
8
full journeyman annualized fringe benefits for training and
9
apprenticeship programs registered with the Office of
10
Apprenticeship within the U.S. Department of Labor's
11
Employment and Training Administration with full journeymen
12
annualized fringe benefits for health and welfare, insurance,
13
vacations
,
and pensions paid generally, in the locality in
14
which the work is being performed, to employees engaged in
15
work of a similar character on public works.
16
(Source: P.A. 103-8, eff. 6-7-23; 103-327, eff. 1-1-24;
17
103-346, eff. 1-1-24; 103-359, eff. 7-28-23; 103-447, eff.
18
8-4-23; 103-605, eff. 7-1-24; 103-1066, eff. 2-20-25; 104-17,
19
eff. 6-30-25; 104-23, eff. 6-30-25; 104-160, eff. 8-14-25;
20
revised 9-12-25.)

21

Section 99.
Effective date.
This Act takes effect upon
22
becoming law.

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