Section 500.1030  Lease Requirements

a)         Length of Leases

1)         Maximum Term.  Except where a longer term is authorized by law, leases shall be for a term not to exceed 10 years inclusive of proposed contract renewals and shall include a termination option in favor of the OAG after 5 years.

2)         Renewal Option.  Leases may include a renewal option.  An option to renew may be exercised only when the Procurement Officer determines in writing that renewal is in the best interest of the OAG and notice of the exercise of the option is published in the Auditor General Bulletin at least 60 days prior to the exercise of the option.

3)         Holdover.  No lease may continue on a month-to-month or other holdover basis for a total of more than 6 months.

b)         Subject to Appropriation

All leases shall recite that they are subject to termination and cancellation in any year for which the General Assembly fails to make an appropriation to make payments under the terms of the lease.

c)         Lessor's Failure to Make Improvements

Each lease must provide for a penalty upon the lessor's failure to make improvements agreed upon in the lease.  The penalty shall consist of a reduction in lease payments equal to the corresponding percentage of the improvement value to the lease value.  The penalty shall continue until the lessor complies with the lease and the improvements are accepted by the leasing State agency.

(Source:  Amended at 35 Ill. Reg. 5307, effective April 1, 2011)