PEORIA (25News Now) – A bill that would expand tax breaks from newly constructed homes to newly remodeled homes will now head to the Illinois House of Representatives after it passed out of the Senate.

The bill, sponsored by Peoria Democrat Sen. Dave Koehler and outgoing Peoria Republican Win Stoller, changes the property tax code to include tax breaks for remodeled or improved homes in areas of urban decay.

As currently written, the state’s property tax code allows local governments to grant an abatement period of up to 10 years for taxes in a certain area of urban decay. Within that area and during that period, newly constructed single-family or duplex homes receive a percentage of their taxes discounted, maxing out at 2%.

Koehler and Stoller’s law would put newly remodeled homes and duplexes under the same umbrella, granting them the 2% discount. The goal is to encourage property owners to invest in homes in that area to revitalize spots like Peoria’s Southside, where many homes need repair.

“This honors our commitment to promoting equitable access to quality housing options, ensuring that all residents have the opportunity to live in safe and well-maintained homes,” said Koehler.

Stoller did not release a statement when the bill passed out of the Senate.

In addition, the bill calls for the abatement to be reduced by 20% for the last four years before it ends, as an off-ramp back to the full property tax bill.

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