Tax Certification Program
As an incentive for property owners who construct waste storage structures and other improvements that eliminate, prevent, or reduce water pollution, the Illinois Environmental Protection Agency (IEPA) administers a tax certification program that can reduce the property tax value of many pollution control improvements. In order to actualize this tax reduction, the owner of the pollution control facility must obtain certification of pollution control improvement by the Illinois Pollution Control Board (IPCB) as a pollution control facility.
To obtain certification from the IPCB, the owner of the pollution control facility must submit a tax certification application to the IEPA for the improvements. The IEPA will conduct a review of the application and file its recommendation to the IPCB indicating if the improvements meet the definition of pollution control facility. A proposed pollution control facility's primary purpose must be to eliminate, prevent or reduce water pollution to meet the definiton of Pollution Control Facility.
Definition of Pollution Control Facility (35 Ill. Amin Code Part 125)
"Pollution Control Facility means, for purpose of the this Part, any system, method, construction, device or appliance appurtenantant there to, or any portion of any building or equipment, that is designed, constructed, installed or operated for the primary purpose of: eliminating, preventing, or reducing air or water pollution, as the terms "air pollution" and "water pollution" are define int he Act; or treating, pre treating, modifiying or disposing of any potential solid, liquid or gaseous pollutant which released without treatment, pretreatment, modification or disposal might be harmful, detrimental or offensive to human, plant or animal life, or to property. This term does not include the following:
- Any facility with the primary purpose of eliminating, containing, preventing or reducing radioactive contaminants or energy, or treating wastewater produced by the nuclear generation of electric power;
Large diameter pipes or piping systems used to remove and disperse heat from water involved in the nuclear generation of electric power;
Any facility operated by any person other than a unit of government, whether within or outside of the territorial boundaries of a unit of local government, for sewage disposal or treatment; or
Land underlying a cooling pond. [35 ILCS 200/11-10]."
Water pollution control
The IEPA Bureau of Water Permit Section is responsible for receiving and processing applications for water pollution control facilities only and therefore the intent of this webpage is to provide information for owners of water pollution control facilities. An owner of both types of pollution control facilities, water and air, must submit separate applications to the Permit Sections of both Bureau of Water and Bureau of Air.
Types of facilities
Livestock operations most commonly take advantage of the tax certification rules in Illinois; however, the provision may also apply to other facilities such as agrichemical containment or other industrial facilities.
The following are examples of pollution control facilities commonly found on livestock operations.
Manure pits under confined animal feed structures and appurtenances to those pits such as pumps, pump pits, manure scrapers, ramps, or other devices provided that such appurtenances are designed, constructed and operated for the primary purpose of the normal operation of the pollution control facility.
Slotted floors over manure pits.
Liquid livestock waste storage facilities including, but not limited to manure storage tanks, lagoons, and holding ponds.
Methane digesters that are specifically designed constructed and operated for the only purpose of reducing odors from livestock wastes provided that such facilities shall meet the requirement that methane or products other than processed animal manures are not produced or collected for utilization in any purpose other than the normal operation of the facility. (Note: methane digestors are air pollution control equipment, therefore a separate request must be submitted to the Bureau of Air, Permit Section.)
How to apply for tax certification of your pollution control facility
Complete and submit the appropriate application form to the IEPA as directed on the forms:
For water pollution control facilities at livestock operations use form: Tax Certification Form for Livestock Operations
For air pollution control facilities at livestock operations use form: Application for Certification (Property Tax Treatment) Pollution Control Facility
For other operations such as agrichemical storage facilities or other industrial facilities use form: Application for Certification (Property Tax Treatment) Pollution Control Facility
The pollution control facility tax certification review process
The tax certification process relies on three separate and distinct Illinois State governmental organizations which include; the IEPA, the IPCB, and the Illinois Department of Revenue(“IDOR”) and the County government with tax authority over the applicant. Details about the role that each plays in the tax certification process is discussed below. It is important to note that each organization’s review process is an independent step that is part of a larger sequence. The review sequence begins with submittal of the application to the IEPA. When the IEPA has completed its recommendation, the IPCB takes over the process. If the IPCB grants the certification, then IDOR begins the assessment process. Because of this arrangement and assignment of responsibilities, interagency coordination is mostly limited to the transmittal of pertinent documentation, while joint application tracking or common application log numbers is not feasible.
The following flow chart is provided to help illustrate the review process for certifying and implementing property tax reductions for pollution. (click on the picture for a larger view)
Illinois Environmental Protection Agency
The initial application for tax certification of a pollution control facility is submitted to the Illinois Environmental Protection Agency (IEPA). Following receipt of the application, the IEPA reviews the application for completeness and to determine consistency with 35 Ill. Admin. Code Part 125. If the IEPA finds that the application meets statutory and regulatory requirements and that proposed improvements qualify as a pollution control facility, the IEPA will provide copies of its recommendation to the IDOR and to the applicant.
During the IEPA’s review, a Bureau of Water employee may contact an applicant by phone, e-mail or written letter if additional information is determined necessary to complete the review of the tax certification application. Written notice of required additional information, either by e-mail or written letter will be attempted. Please note, if applicants do not respond within 45-days to the IEPA’s request for information by providing the requested information or by requesting an additional reasonable period of time, the IEPA may recommend to the IPCB that the tax certification be denied.
If the IEPA finds that a certification request must be denied, partially or entirely, the applicant has an opportunity to file a petition to contest the IEPA’s decision within 35 days of the IEPA’s filing to the IPCB.
Illinois Pollution Control Board
The Illinois Pollution Control Board (IPCB) will independently review the IEPA’s recommendation and the application to determine if the applicable regulations have been satisfied. If acceptable, it will issue a certification order and provide copies to the IDOR and to the applicant. The IPCB provides a searchable database of current and previous tax certification cases on its website at https://pcb.illinois.gov/ClerksOffice/SearchCases
Illinois Department of Revenue
Pollution control facilities certified by the IPCB will be assessed by the Illinois Department of Revenue (IDOR) as of January 1 of the year after the IEPA’s receipt of the tax certification application. The IDOR will assume property tax assessment authority from the facility’s county tax authority. For instance, if an application is received by the IEPA on January 1, 2018, or December 31, 2018, both would come under the IDOR’s assessment jurisdiction as of January 1, 2019.
For properties that are assessed by the IDOR as a result of a favorable tax certification by the IPCB, the IDOR requires the annual filing of Form No. PTAX-401 entitled “Annual Return” at its office in Springfield between the 1st day of April and the 1st day of June.
The IDOR calculates the facility’s assessment and sends the Assessment Notice to the facility’s owner near the end of the calendar year. In the beginning of the next year (Year 3), the IDOR certifies the assessment to the County where the facility is located.
The County will add the facility’s assessment as certified by the IDOR to the assessment that has been determined by the County for the remainder of the real property on that parcel. The County applies the taxing district rates to the combined assessment for that parcel to determine the tax bill.
Property tax bills in Illinois are issued by the County in the year following the assessment date. For example, a tax bill will not be issued until approximately May 2020 for all property assessed as of January 1, 2019.
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