97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
SB2149

 

Introduced 2/10/2011, by Sen. John M. Sullivan

 

SYNOPSIS AS INTRODUCED:
 
See Index

    Creates the Financial Oversight Panel Law of the School Code. Allows a school district (other than the Chicago school district) to petition the State Board of Education for the establishment of a Financial Oversight Panel for the district. Allows the State Board to establish a Financial Oversight Panel without a petition from a district. Contains provisions concerning duties of the district; members and meetings of a Panel; powers of a Panel; officers of a Panel; collective bargaining agreements; deposits and investments; cash and bank accounts; the financial, management, and budgetary structure; the School District Emergency Financial Assistance Fund; grants and loans; the issuance of bonds; a tax levy; a debt service fund; a debt service reserve fund; bond anticipation notes; tax anticipation warrants; reports; a Panel audit; Panel property being exempt from taxation; sanctions; and abolition of a Panel. Makes related changes in the School Code and the Property Tax Code. Effective July 1, 2011.


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FISCAL NOTE ACT MAY APPLY
HOUSING AFFORDABILITY IMPACT NOTE ACT MAY APPLY
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT

 

 

A BILL FOR

 

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1    AN ACT concerning education.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Property Tax Code is amended by changing
5Sections 18-50.1, 18-92, and 18-241 as follows:
 
6    (35 ILCS 200/18-50.1)
7    Sec. 18-50.1. School Finance Authority and Financial
8Oversight Panel levies. Notwithstanding any other law to the
9contrary, any levy adopted by a School Finance Authority
10created under Article 1F of the School Code or a Financial
11Oversight Panel established under Article 1H of the School Code
12is valid and shall be extended by the county clerk if it is
13certified to the county clerk by the Authority or Panel in
14sufficient time to allow the county clerk to include the levy
15in the extension for the taxable year.
16(Source: P.A. 92-855, eff. 12-6-02.)
 
17    (35 ILCS 200/18-92)
18    Sec. 18-92. Downstate School Finance Authority for
19Elementary Districts Law and Financial Oversight Panel Law. The
20provisions of the Truth in Taxation Law are subject to the
21Downstate School Finance Authority for Elementary Districts
22Law and the Financial Oversight Panel Law of the School Code.

 

 

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1(Source: P.A. 95-331, eff. 8-21-07.)
 
2    (35 ILCS 200/18-241)
3    Sec. 18-241. School Finance Authority and Financial
4Oversight Panel.
5    (a) A School Finance Authority established under Article 1E
6or 1F of the School Code shall not be a taxing district for
7purposes of this Law. A Financial Oversight Panel established
8under Article 1H of the School Code shall not be a taxing
9district for purposes of this Law.
10    (b) This Law shall not apply to the extension of taxes for
11a school district for the levy year in which a School Finance
12Authority for the district is created pursuant to Article 1E or
131F of the School Code. This Law shall not apply to the
14extension of taxes for a school district for the levy year in
15which a Financial Oversight Panel for the district is created
16pursuant to Article 1H of the School Code.
17(Source: P.A. 92-547, eff. 6-13-02; 93-501, eff. 8-11-03.)
 
18    Section 15. The School Code is amended by changing Section
191B-8 and by adding Article 1H as follows:
 
20    (105 ILCS 5/1B-8)  (from Ch. 122, par. 1B-8)
21    Sec. 1B-8. There is created in the State Treasury a special
22fund to be known as the School District Emergency Financial
23Assistance Fund (the "Fund"). The School District Emergency

 

 

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1Financial Assistance Fund shall consist of appropriations,
2loan repayments, grants from the federal government, and
3donations from any public or private source. Moneys in the Fund
4may be appropriated only to the Illinois Finance Authority and
5the State Board for those purposes authorized under this
6Article and Articles Article 1F and 1H of this Code. The
7appropriation may be allocated and expended by the State Board
8for contractual services as grants to provide technical
9assistance and consultation consulting services to school
10districts to assess their financial condition to Financial
11Oversight Panels that petition for emergency financial
12assistance grants. The and by the Illinois Finance Authority
13may provide as loans to school districts which are the subject
14of an approved petition for emergency financial assistance
15under Section 1B-4, or 1F-62, or 1H-65 of this Code. Neither
16the State Board of Education nor the Illinois Finance Authority
17may collect any fees for providing these services.
18    From the amount allocated to each such school district
19under this Article the State Board shall identify a sum
20sufficient to cover all approved costs of the Financial
21Oversight Panel established for the respective school
22district. If the State Board and State Superintendent of
23Education have not approved emergency financial assistance in
24conjunction with the appointment of a Financial Oversight
25Panel, the Panel's approved costs shall be paid from deductions
26from the district's general State aid.

 

 

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1    The Financial Oversight Panel may prepare and file with the
2State Superintendent a proposal for emergency financial
3assistance for the school district and for its operations
4budget. No expenditures shall be authorized by the State
5Superintendent until he or she has approved the proposal of the
6Panel, either as submitted or in such lesser amount determined
7by the State Superintendent.
8    The maximum amount of an emergency financial assistance
9loan which may be allocated to any school district under this
10Article, including moneys necessary for the operations of the
11Panel, shall not exceed $4,000 times the number of pupils
12enrolled in the school district during the school year ending
13June 30 prior to the date of approval by the State Board of the
14petition for emergency financial assistance, as certified to
15the local board and the Panel by the State Superintendent. An
16emergency financial assistance grant shall not exceed $1,000
17times the number of such pupils. A district may receive both a
18loan and a grant.
19    The payment of an emergency State financial assistance
20grant or loan shall be subject to appropriation by the General
21Assembly. Emergency State financial assistance allocated and
22paid to a school district under this Article may be applied to
23any fund or funds from which the local board of education of
24that district is authorized to make expenditures by law.
25    Any emergency financial assistance proposed by the
26Financial Oversight Panel and approved by the State

 

 

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1Superintendent may be paid in its entirety during the initial
2year of the Panel's existence or spread in equal or declining
3amounts over a period of years not to exceed the period of the
4Panel's existence. All loan payments made from the School
5District Emergency Financial Assistance Fund for a school
6district shall be required to be repaid, with simple interest
7over the term of the loan at a rate equal to 50% of the one-year
8Constant Maturity Treasury (CMT) yield as last published by the
9Board of Governors of the Federal Reserve System before the
10date on which the district's loan is approved by the State
11Board of Education, not later than the date the Financial
12Oversight Panel ceases to exist. The Panel shall establish and
13the Illinois Finance Authority shall approve the terms and
14conditions, including the schedule, of repayments. The
15schedule shall provide for repayments commencing July 1 of each
16year or upon each fiscal year's receipt of moneys from a tax
17levy for emergency financial assistance. Repayment shall be
18incorporated into the annual budget of the school district and
19may be made from any fund or funds of the district in which
20there are moneys available. Default on repayment is subject to
21the Illinois Grant Funds Recovery Act. When moneys are repaid
22as provided herein they shall not be made available to the
23local board for further use as emergency financial assistance
24under this Article at any time thereafter. All repayments
25required to be made by a school district shall be received by
26the State Board and deposited in the School District Emergency

 

 

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1Financial Assistance Fund.
2    In establishing the terms and conditions for the repayment
3obligation of the school district the Panel shall annually
4determine whether a separate local property tax levy is
5required. The board of any school district with a tax rate for
6educational purposes for the prior year of less than 120% of
7the maximum rate for educational purposes authorized by Section
817-2 shall provide for a separate tax levy for emergency
9financial assistance repayment purposes. Such tax levy shall
10not be subject to referendum approval. The amount of the levy
11shall be equal to the amount necessary to meet the annual
12repayment obligations of the district as established by the
13Panel, or 20% of the amount levied for educational purposes for
14the prior year, whichever is less. However, no district shall
15be required to levy the tax if the district's operating tax
16rate as determined under Section 18-8 or 18-8.05 exceeds 200%
17of the district's tax rate for educational purposes for the
18prior year.
19(Source: P.A. 94-234, eff. 7-1-06.)
 
20    (105 ILCS 5/Art. 1H heading new)
21
ARTICLE 1H. FINANCIAL OVERSIGHT PANELS

 
22    (105 ILCS 5/1H-1 new)
23    Sec. 1H-1. Short title. This Article may be cited as the
24Financial Oversight Panel Law.
 

 

 

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1    (105 ILCS 5/1H-5 new)
2    Sec. 1H-5. Findings; purpose; intent.
3    (a) The General Assembly finds all of the following:
4        (1) A fundamental goal of the people of this State, as
5    expressed in Section 1 of Article X of the Illinois
6    Constitution, is the educational development of all
7    persons to the limits of their capacities. When a board of
8    education faces financial difficulties, continued
9    operation of the public school system is threatened.
10        (2) A sound financial structure is essential to the
11    continued operation of any school system. It is vital to
12    commercial, educational, and cultural interests that
13    public schools remain in operation. To achieve that goal,
14    public school systems must have effective access to the
15    private market to borrow short and long term funds.
16        (3) To promote the financial integrity of districts, as
17    defined in this Article, it is necessary to provide for the
18    creation of financial oversight panels with the powers
19    necessary to promote sound financial management and to
20    ensure the continued operation of the public schools.
21    (b) It is the purpose of this Article to provide a secure
22financial basis for the continued operation of public schools.
23The intention of the General Assembly, in creating this
24Article, is to establish procedures, provide powers, and impose
25restrictions to ensure the financial and educational integrity

 

 

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1of the public schools, while leaving principal responsibility
2for the educational policies of public schools to the boards of
3education within the State, consistent with the requirements
4for satisfying the public policy and purpose set forth in this
5Article.
 
6    (105 ILCS 5/1H-10 new)
7    Sec. 1H-10. Definitions. As used in this Article:
8    "Bonds" means bonds authorized to be issued by the Panel
9under Section 1H-70 of this Code.
10    "Budget" means the annual budget of the district required
11under Section 17-1 of this Code, as in effect from time to
12time.
13    "Chairperson" means the Chairperson of the Panel.
14    "District" means any school district having a population of
15not more than 500,000 that has had a Financial Oversight Panel
16established under this Article.
17    "Financial plan" means the financial plan of the district
18to be developed pursuant to this Article, as in effect from
19time to time.
20    "Fiscal year" means the fiscal year of the district.
21    "Obligations" means bonds and notes of the Panel.
22    "Panel" means a Financial Oversight Panel created under
23this Article.
24    "State Board" means the State Board of Education.
25    "State Superintendent" means the State Superintendent of

 

 

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1Education.
 
2    (105 ILCS 5/1H-15 new)
3    Sec. 1H-15. Establishment of Financial Oversight Panels;
4duties of district.
5    (a) A school district may petition the State Board for the
6establishment of a Financial Oversight Panel for the district.
7The petition shall cite the reasons why the creation of a
8Financial Oversight Panel for the district is necessary. The
9State Board may grant the petition upon determining that the
10approval of the petition is in the best educational and
11financial interests of the district. The State Board may
12establish a Financial Oversight Panel without a petition from a
13district if the State Board determines that such action is in
14the best educational and financial interests of the district.
15    (b) Upon establishment of a Financial Oversight Panel, all
16of the following shall occur:
17        (1) There is established a body both corporate and
18    politic to be known as the "(Name of School District)
19    Financial Oversight Panel", which in this name shall
20    exercise all authority vested in a Panel by this Article.
21        (2) The duties and obligations of the district under
22    Article 1B of this Code shall be transferred and become
23    duties and obligations owed by the district to the
24    Financial Oversight Panel.
25    (c) In the event of a conflict between the provisions of

 

 

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1this Article and the provisions of Article 1B of this Code, the
2provisions of this Article control.
3    (d) Any school district having a Financial Oversight Panel
4established under Article 1B of this Code or any Financial
5Oversight Panel established under Article 1B may petition the
6State Board for the establishment of a Financial Oversight
7Panel under this Article and concurrent dissolution of the
8Article 1B Panel. All records, papers, books, funds, or other
9assets or liabilities belonging to the dissolving Financial
10Oversight Panel shall be transferred to the newly established
11Financial Oversight Panel.
 
12    (105 ILCS 5/1H-20 new)
13    Sec. 1H-20. Members of Panel; meetings.
14    (a) Upon establishment of a Financial Oversight Panel under
15Section 1H-15 of this Code, the State Superintendent shall
16within 15 working days thereafter appoint 5 members to serve on
17a Financial Oversight Panel for the district. Members appointed
18to the Panel shall serve at the pleasure of the State
19Superintendent. The State Superintendent shall designate one
20of the members of the Panel to serve as its Chairperson. In the
21event of vacancy or resignation, the State Superintendent
22shall, within 10 days after receiving notice, appoint a
23successor to serve out that member's term. The State
24Superintendent may remove a member for incompetence,
25malfeasance, neglect of duty, or other just cause.

 

 

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1    (b) Members of the Panel shall be selected primarily on the
2basis of their experience and education in financial
3management, with consideration given to persons knowledgeable
4in education finance. Two members of the Panel shall be
5residents of the school district that the Panel serves. A
6member of the Panel may not be a member of the district's
7school board or an employee of the district nor may a member
8have a direct financial interest in the district.
9    (c) Panel members may be reimbursed by the State Board for
10travel and other necessary expenses incurred in the performance
11of their official duties. Unless paid from bonds issued under
12Section 1H-70 of this Code, the amount reimbursed members for
13their expenses shall be charged to the school district as part
14of any emergency financial assistance and incorporated as a
15part of the terms and conditions for repayment of the
16assistance or shall be deducted from the district's general
17State aid as provided in Section 1H-65 of this Code.
18    (d) With the exception of the chairperson, who shall be
19designated as provided in subsection (a) of this Section, the
20Panel may elect such officers as it deems appropriate.
21    (e) The first meeting of the Panel shall be held at the
22call of the Chairperson. The Panel shall prescribe the times
23and places for its meetings and the manner in which regular and
24special meetings may be called and shall comply with the Open
25Meetings Act.
26    (f) Three members of the Panel shall constitute a quorum.

 

 

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1When a vote is taken upon any measure before the Panel, a
2quorum being present, a majority of the votes of the members
3voting on the measure shall determine the outcome.
 
4    (105 ILCS 5/1H-25 new)
5    Sec. 1H-25. General powers. The purposes of the Panel shall
6be to exercise financial control over the district and to
7furnish financial assistance so that the district can provide
8public education within the district's jurisdiction while
9permitting the district to meet its obligations to its
10creditors and the holders of its debt. Except as expressly
11limited by this Article, the Panel shall have all powers
12granted to a voluntary or involuntary Financial Oversight Panel
13and to a Financial Administrator under Article 1B of this Code
14and all other powers necessary to meet its responsibilities and
15to carry out its purposes and the purposes of this Article,
16including without limitation all of the following powers,
17provided that the Panel shall have no power to terminate any
18employee without following the statutory procedures for such
19terminations set forth in this Code:
20        (1) To sue and to be sued.
21        (2) To make, cancel, modify, and execute contracts,
22    leases, subleases, and all other instruments or agreements
23    necessary or convenient for the exercise of the powers and
24    functions granted by this Article, subject to Section 1H-45
25    of this Code. The Panel may at a regular or special meeting

 

 

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1    find that the district has insufficient or inadequate funds
2    with respect to any contract, other than collective
3    bargaining agreements.
4        (3) To purchase real or personal property necessary or
5    convenient for its purposes; to execute and deliver deeds
6    for real property held in its own name; and to sell, lease,
7    or otherwise dispose of such of its property as, in the
8    judgment of the Panel, is no longer necessary for its
9    purposes.
10        (4) To appoint officers, agents, and employees of the
11    Panel, including a chief executive officer, a chief fiscal
12    officer, and a chief educational officer; to define their
13    duties and qualifications; and to fix their compensation
14    and employee benefits.
15        (5) To transfer to the district such sums of money as
16    are not required for other purposes.
17        (6) To borrow money, including without limitation
18    accepting State loans, and to issue obligations pursuant to
19    this Article; to fund, refund, or advance refund the same;
20    to provide for the rights of the holders of its
21    obligations; and to repay any advances.
22        (7) To levy all property tax levies that otherwise
23    could be levied by the district, and to make levies
24    pursuant to Section 1H-65 of this Code. This levy or levies
25    shall be exempt from the Truth in Taxation Law.
26        (8) Subject to the provisions of any contract with or

 

 

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1    for the benefit of the holders of its obligations, to
2    purchase or redeem its obligations.
3        (9) To procure all necessary goods and services for the
4    Panel in compliance with the purchasing laws and
5    requirements applicable to the district.
6        (10) To do any and all things necessary or convenient
7    to carry out its purposes and exercise the powers given to
8    it by this Article.
9        (11) To recommend annexation, consolidation,
10    dissolution, or reorganization of the district, in whole or
11    in part, to the State Board if in the Panel's judgment the
12    circumstances so require. No such proposal for annexation,
13    consolidation, dissolution, or reorganization shall occur
14    unless the Panel and the school boards of all other
15    districts directly affected by the annexation,
16    consolidation, dissolution, or reorganization have each
17    approved by majority vote the annexation, consolidation,
18    dissolution, or reorganization. Notwithstanding any other
19    law to the contrary, upon approval of the proposal by the
20    State Board, the State Board and all other affected
21    entities shall forthwith implement the proposal. When a
22    dissolution and annexation becomes effective for purposes
23    of administration and attendance, the positions of
24    teachers in contractual continued service in the district
25    being dissolved shall be transferred to the annexing
26    district or districts, pursuant to the provisions of

 

 

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1    Section 24-12 of this Code. In the event that the territory
2    is added to 2 or more districts, the decision on which
3    positions shall be transferred to which annexing districts
4    shall be made by giving consideration to the proportionate
5    percentage of pupils transferred and the annexing
6    districts' staffing needs, and the transfer of teachers in
7    contractual continued service into positions shall be
8    based upon the request of those teachers in contractual
9    continued service in order of seniority in the dissolving
10    district. The status of all teachers in contractual
11    continued service transferred to an annexing district
12    shall not be lost, and the board of the annexing district
13    is subject to this Code with respect to teachers in
14    contractual continued service who are transferred in the
15    same manner as if the person were the annexing district's
16    employee and had been its employee during the time the
17    person was actually employed by the board of the dissolving
18    district from which the position was transferred.
 
19    (105 ILCS 5/1H-30 new)
20    Sec. 1H-30. Chief executive officer. The Panel may appoint
21a chief executive officer who, under the direction of the
22Panel, shall supervise the Panel's staff, including the chief
23educational officer and the chief fiscal officer, and shall
24have ultimate responsibility for implementing the policies,
25procedures, directives, and decisions of the Panel. The chief

 

 

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1executive officer shall have the authority to determine the
2agenda and order of business at school board meetings, as
3needed in order to carry forward and implement the objectives
4and priorities of the school board and Financial Oversight
5Panel in the administration and management of the district. The
6chief executive officer is not required to hold any certificate
7issued under Article 21 of this Code. The chief executive
8officer shall have the powers and duties as assigned by the
9Panel in accordance with this Code.
 
10    (105 ILCS 5/1H-35 new)
11    Sec. 1H-35. Chief educational officer. The Panel may at a
12regular or special meeting find that cause exists to cancel the
13contract of the school district's superintendent who is serving
14at the time the Panel is established. If there is no
15superintendent, then the Panel may appoint a chief educational
16officer for the district, who shall have all of the powers and
17duties of a school district superintendent under this Code and
18such other duties as may be assigned by the Panel in accordance
19with this Code. The chief educational officer shall report to
20the Panel or the chief executive officer appointed by the
21Panel. The district shall not thereafter employ a
22superintendent during the period that a chief educational
23officer is serving in the district. The chief educational
24officer is not required to hold any certificate issued under
25Article 21 of this Code.
 

 

 

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1    (105 ILCS 5/1H-40 new)
2    Sec. 1H-40. Chief fiscal officer. The Panel may appoint a
3chief fiscal officer who, under the direction of the Panel or
4the chief executive officer appointed by the Panel, shall have
5all of the powers and duties of the district's chief school
6business official and any other duties regarding budgeting,
7accounting, and other financial matters that are assigned by
8the Panel, in accordance with this Code. The district may not
9employ a chief school business official during the period that
10the chief fiscal officer is serving in the district. The chief
11fiscal officer is not required to hold a certificate issued
12under Article 21 of this Code.
 
13    (105 ILCS 5/1H-41 new)
14    Sec. 1H-41. Superintendent. The Panel may employ a
15superintendent who, under the direction of the Panel or the
16chief executive officer appointed by the Panel, shall have all
17of the powers and duties of a school district superintendent
18under this Code assigned by the Panel and such other duties as
19may be assigned by the Panel in accordance with this Code. The
20superintendent shall report to the Panel or the chief executive
21officer appointed by the Panel. The superintendent shall hold a
22certificate with a superintendent endorsement issued under
23Article 21 of this Code.
 

 

 

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1    (105 ILCS 5/1H-42 new)
2    Sec. 1H-42. Chief school business official. The Panel may
3employ a chief school business official who, under the
4direction of the Panel or the chief executive officer appointed
5by the Panel, shall have all of the powers and duties of a
6chief school business official under this Code assigned by the
7Panel and such other duties as may be assigned by the Panel in
8accordance with this Code. The chief school business official
9shall report to the Panel or the chief executive officer
10appointed by the Panel. The chief school business official
11shall hold a certificate with a chief school business official
12endorsement issued under Article 21 of this Code.
 
13    (105 ILCS 5/1H-45 new)
14    Sec. 1H-45. Collective bargaining agreements. The Panel
15shall have the power to negotiate collective bargaining
16agreements with the district's employees in lieu of and on
17behalf of the district. Upon concluding bargaining, the
18district shall execute the agreements negotiated by the Panel,
19and the district shall be bound by and shall administer the
20agreements in all respects as if the agreements had been
21negotiated by the district itself.
 
22    (105 ILCS 5/1H-50 new)
23    Sec. 1H-50. Deposits and investments.
24    (a) The Panel shall have the power to establish checking

 

 

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1and whatever other banking accounts it may deem appropriate for
2conducting its affairs.
3    (b) Subject to the provisions of any contract with or for
4the benefit of the holders of its obligations, the Panel may
5invest any funds not required for immediate use or
6disbursement, as provided in the Public Funds Investment Act.
 
7    (105 ILCS 5/1H-55 new)
8    Sec. 1H-55. Cash accounts and bank accounts.
9    (a) The Panel shall require the district or any officer of
10the district, including the district's treasurer, to establish
11and maintain separate cash accounts and separate bank accounts
12in accordance with such rules, standards, and procedures as the
13Panel may prescribe.
14    (b) The Panel shall have the power to assume exclusive
15administration of the cash accounts and bank accounts of the
16district, to establish and maintain whatever new cash accounts
17and bank accounts it may deem appropriate, and to withdraw
18funds from these accounts for the lawful expenditures of the
19district.
 
20    (105 ILCS 5/1H-60 new)
21    Sec. 1H-60. Financial, management, and budgetary
22structure. Upon direction of the Panel, the district shall
23reorganize the financial accounts, management, and budgetary
24systems of the district in whatever manner the Panel deems

 

 

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1appropriate to achieve greater financial responsibility and to
2reduce financial inefficiency.
 
3    (105 ILCS 5/1H-65 new)
4    Sec. 1H-65. School District Emergency Financial Assistance
5Fund; grants and loans.
6    (a) Moneys in the School District Emergency Financial
7Assistance Fund established under Section 1B-8 of this Code may
8be allocated and expended by the State Board for contractual
9services to provide technical assistance and consultation to
10school districts to assess their financial condition or to
11Panels that petition for emergency financial assistance grants
12and by the Illinois Finance Authority as loans to school
13districts that are the subject of an approved petition for
14emergency financial assistance under Section 1B-4, 1F-62, or
151H-65 of this Code. Neither the State Board of Education nor
16the Illinois Finance Authority may collect any fees for
17providing these services. From the amount allocated to each
18such school district, the State Board shall identify a sum
19sufficient to cover all approved costs of the Panel established
20for the respective school district. If the State Board and
21State Superintendent of Education have not approved emergency
22financial assistance in conjunction with the appointment of a
23Panel, the Panel's approved costs shall be paid from deductions
24from the district's general State aid. An emergency financial
25assistance loan to a Panel or borrowing from sources other than

 

 

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1the State shall not be considered as part of the calculation of
2a district's debt for purposes of the limitation specified in
3Section 19-1 of this Code.
4    (b) The Panel may prepare and file with the State
5Superintendent a proposal for emergency financial assistance
6for the school district and for its operations budget. No
7expenditures shall be authorized by the State Superintendent
8until he or she has approved the proposal of the Panel, either
9as submitted or in such lesser amount determined by the State
10Superintendent.
11    (c) The amount of an emergency financial assistance loan
12that may be allocated to a Panel under this Article, including
13(i) moneys necessary for the operations of the Panel and (ii)
14borrowing from sources other than the State shall not exceed,
15in the aggregate, $4,000 times the number of pupils enrolled in
16the district during the school year ending June 30 prior to the
17date of approval of the petition for emergency financial
18assistance by the State Board. However, this limitation does
19not apply to borrowing by the district secured by amounts
20levied by the district prior to establishment of the Panel. An
21emergency financial assistance grant shall not exceed $1,000
22times the number of such pupils. A district may receive both a
23loan and a grant.
24    (d) The payment of a State emergency financial assistance
25grant or loan is subject to appropriation by the General
26Assembly. State emergency financial assistance allocated and

 

 

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1paid to a Panel under this Article may be applied to any fund
2or funds from which the Panel is authorized to make
3expenditures by law.
4    (e) Any State emergency financial assistance proposed by
5the Panel and approved by the State Superintendent may be paid
6in its entirety during the initial year of the Panel's
7existence or spread in equal or variable amounts over a period
8of years not to exceed the period of the Panel's existence. The
9State Superintendent shall not approve any loan to the Panel
10unless the Panel has been unable to borrow sufficient funds to
11operate the district.
12    (f) All loan payments made from the School District
13Emergency Financial Assistance Fund to a Panel shall be
14required to be repaid not later than the date the Panel ceases
15to exist, with simple interest over the term of the loan at a
16rate equal to 50% of the one-year Constant Maturity Treasury
17(CMT) yield as last published by the Board of Governors of the
18Federal Reserve System before the date on which the Financial
19Oversight Panel's loan is approved by the State Superintendent.
20    (g) The Panel shall establish and the Illinois Finance
21Authority shall approve the terms and conditions of the loan,
22including the schedule of repayments. The schedule shall
23provide for repayments commencing July 1 of each year or upon
24each fiscal year's receipt of moneys from a tax levy for
25emergency financial assistance. Repayment shall be
26incorporated into the annual budget of the district and may be

 

 

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1made from any fund or funds of the district in which there are
2moneys available. Default on repayment is subject to the
3Illinois Grant Funds Recovery Act. When moneys are repaid as
4provided in this Section, they shall not be made available to
5the Panel for further use as emergency financial assistance
6under this Article at any time thereafter. All repayments
7required to be made by a Panel shall be deposited into the
8School District Emergency Financial Assistance Fund.
9    (h) In establishing the terms and conditions for the
10repayment obligation of the Panel, the Panel shall annually
11determine whether a separate local property tax levy is
12required to meet that obligation. The Financial Oversight Panel
13shall provide for a separate tax levy for emergency financial
14assistance repayment purposes. This tax levy shall not be
15subject to referendum approval. The amount of the levy shall
16not exceed the amount necessary to meet the annual emergency
17financial repayment obligations of the district, including
18principal and interest, as established by the Panel, and shall
19not be subject to the provisions of the Property Tax Extension
20Limitation Law.
 
21    (105 ILCS 5/1H-70 new)
22    Sec. 1H-70. Power to issue bonds.
23    (a) The Panel may incur indebtedness by the issuance of
24negotiable full faith and credit general obligation bonds of
25the Panel in an outstanding amount not to exceed at any time,

 

 

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1including existing indebtedness, 15% of the district's most
2recent equalized assessed valuation, excluding Bonds of the
3Panel that have been refunded, for (i) the purpose of providing
4the district with moneys for ordinary and necessary
5expenditures and other operational needs of the district; (ii)
6payment or refunding of outstanding debt obligations or tax
7anticipation warrants of the district, the proceeds of which
8were used to provide financing for the district; (iii) payment
9of fees for arrangements as provided in subsection (b) of
10Section 1H-75 of this Code; (iv) payment of interest on Bonds;
11(v) establishment of reserves to secure Bonds; (vi) the payment
12of costs of issuance of Bonds; (vii) payment of principal of or
13interest or redemption premium on any Bonds or notes of the
14Panel; and (viii) all other expenditures of the Panel
15incidental to and necessary or convenient for carrying out its
16corporate purposes and powers.
17    (b) The Panel may from time to time (i) issue Bonds to
18refund any outstanding Bonds or notes of the Panel, whether the
19Bonds or notes to be refunded have or have not matured or
20become redeemable, and (ii) issue Bonds partly to refund Bonds
21or notes then outstanding and partly for any other purpose set
22forth in this Section.
23    (c) Bonds issued in accordance with subsection (a) of this
24Section are not subject to any other statutory limitation as to
25debt, including without limitation that established by the
26Local Government Debt Limitation Act, and may be issued without

 

 

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1referendum.
 
2    (105 ILCS 5/1H-75 new)
3    Sec. 1H-75. Terms of bonds.
4    (a) Whenever the Panel desires or is required to issue
5Bonds as provided in this Article, it shall adopt a resolution
6designating the amount of the Bonds to be issued, the purposes
7for which the proceeds of the Bonds are to be used, and the
8manner in which the proceeds shall be held pending the
9application thereof. The Bonds shall be issued in the corporate
10name of the Panel and shall bear such date or dates and shall
11mature at such time or times, not exceeding 20 years from their
12date, as the resolution may provide. The Bonds may be issued as
13serial bonds payable in installments, as term bonds with
14sinking fund installments, or as a combination of these as the
15Panel may determine in the resolution. The Bonds shall be in
16such denominations as the Panel may determine. The Bonds shall
17be in such form, carry such registration privileges, be
18executed in such manner, be payable at such place or places,
19and be subject to such terms of redemption at such redemption
20prices, including premium, as the resolution may provide. The
21Bonds shall be sold by the Panel at public or private sale, as
22determined by the Panel.
23    (b) In connection with the issuance of its Bonds, the Panel
24may enter into arrangements to provide additional security and
25liquidity for the Bonds. These may include without limitation

 

 

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1municipal bond insurance, letters of credit, lines of credit by
2which the Panel may borrow funds to pay or redeem its Bonds,
3and purchase or remarketing arrangements for ensuring the
4ability of owners of the Panel's Bonds to sell their Bonds or
5to have their Bonds redeemed. The Panel may enter into
6contracts and may agree to pay fees to persons providing the
7arrangements, including from Bond proceeds, but only under
8circumstances in which the total interest paid or to be paid on
9the Bonds, together with the fees for the arrangements (being
10treated as if interest), would not, taken together, cause the
11Bonds to bear interest, calculated to their absolute maturity,
12at a rate in excess of the maximum rate allowed by law.
13    The resolution of the Panel authorizing the issuance of its
14Bonds may provide that interest rates may vary from time to
15time depending upon criteria established by the Panel, which
16may include without limitation a variation in interest rates as
17may be necessary to cause the Bonds to be remarketable from
18time to time at a price equal to their principal amount, and
19may provide for appointment of a national banking association,
20bank, trust company, investment banker, or other financial
21institution to serve as a remarketing agent in that connection.
22The resolution of the Panel authorizing the issuance of its
23Bonds may provide that alternative interest rates or provisions
24shall apply during such times as the Bonds are held by a person
25providing a letter of credit or other credit enhancement
26arrangement for those Bonds.
 

 

 

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1    (105 ILCS 5/1H-80 new)
2    Sec. 1H-80. Tax levy.
3    (a) Before or at the time of issuing any Bonds, the Panel
4shall provide by resolution for the levy and collection of a
5direct annual tax upon all the taxable property located within
6the district, without limit as to rate or amount, sufficient to
7pay and discharge the principal thereof at maturity or on
8sinking fund installment dates and to pay the interest thereon
9as it falls due. The taxes as levied shall also include
10additional amounts to the extent that the collections in the
11prior years were insufficient to pay and discharge the
12principal thereof at maturity, sinking fund installments, if
13any, and interest thereon as it fell due, and the amount so
14collected shall be placed in the debt service reserve fund. The
15tax shall be in addition to and exclusive of the maximum of all
16taxes that the Panel or the district is authorized by law to
17levy for any and all school purposes. The resolution shall be
18in force upon its adoption.
19    (b) The levy shall be for the sole benefit of the holders
20of the Bonds, and the holders of the Bonds shall have a
21security interest in and lien upon all rights, claims, and
22interests of the Panel arising pursuant to the levy and all
23present and future proceeds of the levy until the principal of
24and sinking fund installments and interest on the Bonds are
25paid in full. All proceeds from the levy shall be deposited by

 

 

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1each county collector directly into the debt service fund
2established pursuant to Section 1H-85 of this Code, shall be
3applied solely for the payment of principal of and sinking fund
4installments and interest on the Bonds, and shall not be used
5for any other purpose.
6    (c) Upon the filing in the office of the county clerk of
7each county where the school district is located of a duly
8certified copy of the resolution, it shall be the duty of each
9county clerk to extend the tax provided for in the resolution,
10including an amount determined by the Panel to cover loss and
11cost of collection and also deferred collections and abatements
12in the amount of the taxes as extended on the collectors'
13books. The tax shall be separate and apart from all other taxes
14of the Panel or the district and shall be separately identified
15by the collectors.
 
16    (105 ILCS 5/1H-85 new)
17    Sec. 1H-85. Debt service fund. The Panel shall establish a
18debt service fund for the Bonds, to be maintained by a paying
19agent, escrow agent, depository, or corporate trustee, which
20may be any trust company or bank having the power of a trust
21company within this State, separate and segregated from all
22other funds and accounts of the Panel and the district. All
23moneys on deposit in the debt service fund shall be held in
24trust in the debt service fund for the benefit of the holders
25of the Bonds, shall be applied solely for the payment of the

 

 

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1principal of and sinking fund installment, redemption premium,
2if any, and interest on the Bonds, and shall not be used for
3any other purpose. The holders of the Bonds shall have a
4security interest in and lien upon all such moneys.
 
5    (105 ILCS 5/1H-90 new)
6    Sec. 1H-90. Debt service reserve fund.
7    (a) The Panel may create and establish a debt service
8reserve fund to be maintained by a paying agent, escrow agent,
9depository, or corporate trustee, which may be any trust
10company or bank having the power of a trust company within the
11State, separate and segregated from all other funds and
12accounts of the Panel. The Panel may pay the following into the
13debt service reserve fund:
14        (1) any proceeds from the sale of Bonds to the extent
15    provided in the resolution authorizing the issuance of the
16    Bonds; and
17        (2) any other moneys that may be available to the Panel
18    for the purpose of the fund.
19    (b) The amount to be accumulated in the debt service
20reserve fund shall be determined by the Panel, but shall not
21exceed the maximum amount of interest, principal, and sinking
22fund installments due in any succeeding calendar year.
23    (c) All moneys on deposit in the debt service reserve fund
24shall be held in trust for the benefit of the holders of the
25Bonds, shall be applied solely for the payment of principal of

 

 

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1and sinking fund installments and interest on the Bonds to the
2extent not paid from the debt service fund, and shall not be
3used for any other purpose.
4    (d) Any moneys in the debt service reserve fund in excess
5of the amount determined by the Panel pursuant to a resolution
6authorizing the issuance of Bonds may be withdrawn by the Panel
7and used for any of its lawful purposes.
8    (e) In computing the amount of the debt service reserve
9fund, investments shall be valued as the Panel provides in the
10resolution authorizing the issuance of the Bonds.
 
11    (105 ILCS 5/1H-95 new)
12    Sec. 1H-95. Bond anticipation notes.
13    (a) After the issuance of Bonds has been authorized, the
14Panel shall have power to issue from time to time, pursuant to
15a resolution or resolutions of the Panel, negotiable bond
16anticipation notes of the Panel in anticipation of the issuance
17of Bonds.
18    (b) Bond anticipation notes shall mature not later than 2
19years after the date of issuance, may be made redeemable prior
20to their maturity, and may be sold in such manner, in such
21denominations, and at such price or prices and shall bear
22interest at such rate or rates not to exceed the maximum annual
23rate authorized by law as a resolution authorizing the issuance
24of the bond anticipation notes may provide.
25    (c) The bond anticipation notes may be made payable as to

 

 

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1both principal and interest from the proceeds of the Bonds. The
2Panel may provide for payment of interest on the bond
3anticipation notes from direct annual taxes upon all of the
4taxable property located within the district that are
5authorized to be levied annually for that purpose, without
6limit as to rate or amount, sufficient to pay the interest as
7it falls due, in the manner, subject to the security interest
8and lien, and with the effect provided in Section 1H-80 of this
9Code.
10    (d) The Panel is authorized to issue renewal notes in the
11event it is unable to issue Bonds to pay outstanding bond
12anticipation notes, on terms the Panel deems reasonable.
13    (e) A debt service fund shall be established in the manner
14provided in Section 1H-85 of this Code by the Panel for the
15bond anticipation notes, and the proceeds of any tax levy made
16pursuant to this Section shall be deposited into the fund upon
17receipt.
 
18    (105 ILCS 5/1H-100 new)
19    Sec. 1H-100. Vesting powers in trustee or other authorized
20agent. The resolution authorizing issuance of the Bonds shall
21vest in a trustee, paying agent, escrow agent, or depository
22such rights, powers, and duties in trust as the Panel may
23determine and may contain such provisions for protecting and
24enforcing the rights and remedies of the holders of the Bonds
25and limiting such rights and remedies as may be reasonable and

 

 

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1proper and not in violation of law, including covenants setting
2forth the duties of the Panel in relation to the exercise of
3its corporate powers and the custody, safeguarding, and
4application of all moneys. The resolution shall provide for the
5manner in which moneys in the various funds and accounts of the
6Panel may be invested and the disposition of the earnings on
7the investments.
 
8    (105 ILCS 5/1H-105 new)
9    Sec. 1H-105. Discharge of bonds.
10    (a) If the Panel pays or causes to be paid to the holders
11of all Bonds then outstanding the principal, redemption price,
12if any, and interest to become due on the Bonds, at the times
13and in the manner stipulated therein and in the resolution
14authorizing the issuance of the Bonds, then the covenants,
15agreements, and other obligations of the Panel to the
16Bondholders shall be discharged and satisfied.
17    (b) Bonds or interest installments for the payment or
18redemption of which moneys have been set aside and held in
19trust by the trustee or other authorized agent provided for in
20Section 1H-100 of this Code, through deposit by the Panel of
21funds for the payment, redemption, or otherwise, at the
22maturity or redemption date, are deemed to have been paid
23within the meaning and with the effect expressed in subsection
24(a) of this Section. All outstanding Bonds of any series, prior
25to the maturity or redemption date, are deemed to have been

 

 

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1paid within the meaning and with the effect expressed in
2subsection (a) of this Section if (1) there has been deposited
3with the trustee or other authorized agent either (A) moneys in
4an amount that is sufficient or (B) direct obligations of the
5United States of America the principal of and the interest on
6which, when due, will provide moneys that, together with the
7moneys, if any, deposited with the trustee or other authorized
8agent at the same time, are sufficient to pay, when due, the
9principal, sinking fund installment, or redemption price, if
10applicable, of and interest due and to become due on the Bonds
11on and prior to the redemption date, sinking fund installment
12date, or maturity date, as the case may be, and (2) the Panel
13has given the trustee or other authorized agent, in form
14satisfactory to it, irrevocable instructions to give notice to
15the effect and in accordance with the procedures provided in
16the resolution authorizing the issuance of the Bonds. Neither
17direct obligations of the United States of America, moneys
18deposited with the trustee or other authorized agent, or
19principal or interest payments on the securities shall be
20withdrawn or used for any purpose other than, and shall be held
21in trust for, the payment of the principal or redemption price,
22if applicable, and interest on the Bonds.
 
23    (105 ILCS 5/1H-110 new)
24    Sec. 1H-110. Pledge of the State. The State of Illinois
25pledges to and agrees with the holders of Bonds that the State

 

 

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1will not limit or alter the rights and powers vested in the
2Panel by this Article with respect to the issuance of
3obligations so as to impair the terms of any contract made by
4the Panel with these holders or in any way impair the rights
5and remedies of these holders until the Bonds, together with
6interest on the Bonds, interest on any unpaid installments of
7interest, and all costs and expenses in connection with any
8action or proceedings by or on behalf of these holders, are
9fully met and discharged or provisions made for their payment.
10The Panel is authorized to include this pledge and agreement of
11the State in any resolution or contract with the holders of
12Bonds.
 
13    (105 ILCS 5/1H-115 new)
14    Sec. 1H-115. Statutory lien. Any pledge, assignment, lien,
15or security interest for the benefit of the holders of Bonds or
16bond anticipation notes, if any, created pursuant to this
17Article are valid and binding from the time the Bonds are
18issued, without any physical delivery or further act, and are
19valid and binding as against and prior to any claims of all
20other parties having claims of any kind in tort, contract, or
21otherwise against the State, the Panel, the district, or any
22other person, irrespective of whether the other parties have
23notice.
 
24    (105 ILCS 5/1H-120 new)

 

 

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1    Sec. 1H-120. State or district not liable on obligations.
2Obligations shall not be deemed to constitute (i) a debt or
3liability of the State, the district, or any political
4subdivision of the State or district other than the Panel or
5(ii) a pledge of the full faith and credit of the State, the
6district, or any political subdivision of the State or district
7other than the Panel but shall be payable solely from the funds
8and revenues provided for in this Article. The issuance of
9obligations shall not directly, indirectly, or contingently
10obligate the State, the district, or any political subdivision
11of the State or district other than the Panel to levy any form
12of taxation therefor or to make any appropriation for their
13payment. Nothing in this Section shall prevent or be construed
14to prevent the Panel from pledging its full faith and credit to
15the payment of obligations. Nothing in this Article shall be
16construed to authorize the Panel to create a debt of the State
17or the district within the meaning of the Constitution or laws
18of Illinois, and all obligations issued by the Panel pursuant
19to the provisions of this Article are payable and shall state
20that they are payable solely from the funds and revenues
21pledged for their payment in accordance with the resolution
22authorizing their issuance or any trust indenture executed as
23security therefor. The State or the district shall not in any
24event be liable for the payment of the principal of or interest
25on any obligations of the Panel or for the performance of any
26pledge, obligation, or agreement of any kind whatsoever that

 

 

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1may be undertaken by the Panel. No breach of any such pledge,
2obligation, or agreement may impose any liability upon the
3State or the district or any charge upon their general credit
4or against their taxing power.
 
5    (105 ILCS 5/1H-125 new)
6    Sec. 1H-125. Obligations as legal investments. The
7obligations issued under the provisions of this Article are
8hereby made securities in which all public officers and bodies
9of this State, all political subdivisions of this State, all
10persons carrying on an insurance business, all banks, bankers,
11trust companies, savings banks, and savings associations
12(including savings and loan associations, building and loan
13associations, investment companies, and other persons carrying
14on a banking business), and all credit unions, pension funds,
15administrators, and guardians who are or may be authorized to
16invest in bonds or in other obligations of the State may
17properly and legally invest funds, including capital, in their
18control or belonging to them. The obligations are also hereby
19made securities that may be deposited with and may be received
20by all public officers and bodies of the State, all political
21subdivisions of the State, and public corporations for any
22purpose for which the deposit of bonds or other obligations of
23the State is authorized.
 
24    (105 ILCS 5/1H-130 new)

 

 

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1    Sec. 1H-130. Complete authority. This Article, without
2reference to any other law, shall be deemed full and complete
3authority for the issuance of Bonds and bond anticipation notes
4as provided in this Article.
 
5    (105 ILCS 5/1H-135 new)
6    Sec. 1H-135. Tax anticipation warrants. A Panel shall have
7the same power to issue tax anticipation warrants as a school
8board under Section 17-16 of this Code. Tax anticipation
9warrants are considered borrowing from sources other than the
10State and are subject to Section 1H-65 of this Code.
 
11    (105 ILCS 5/1H-140 new)
12    Sec. 1H-140. Reports.
13    (a) The Panel, upon taking office and annually thereafter,
14shall prepare and submit to the Governor, General Assembly, and
15State Superintendent a report that includes the audited
16financial statement for the preceding fiscal year, an approved
17financial plan, and a statement of the major steps necessary to
18accomplish the objectives of the financial plan.
19    (b) Annual reports must be submitted on or before March 1
20of each year.
21    (c) The requirement for reporting to the General Assembly
22shall be satisfied by filing copies of the report as provided
23in Section 3.1 of the General Assembly Organization Act and by
24filing additional copies with the State Government Report

 

 

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1Distribution Center for the General Assembly as required under
2subdivision (t) of Section 7 of the State Library Act.
 
3    (105 ILCS 5/1H-145 new)
4    Sec. 1H-145. Audit of Panel. The State Superintendent may
5require a separate audit of the Panel, otherwise the activities
6of the Panel must be included in the scope of the audit of the
7school district. A copy of the audit report covering the Panel
8must be submitted to the State Superintendent.
 
9    (105 ILCS 5/1H-150 new)
10    Sec. 1H-150. Assistance by State agencies, units of local
11government, and school districts. The district shall render
12such services to and permit the use of its facilities and
13resources by the Panel at no charge as may be requested by the
14Panel. Any State agency, unit of local government, or school
15district may, within its lawful powers and duties, render such
16services to the Panel as may be requested by the Panel. Upon
17request of the Panel, any State agency, unit of local
18government, or school district is authorized and empowered to
19loan to the Panel such officers and employees as the Panel may
20deem necessary in carrying out its functions and duties.
21Officers and employees so transferred shall not lose or forfeit
22their employment status or rights.
 
23    (105 ILCS 5/1H-155 new)

 

 

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1    Sec. 1H-155. Property of Panel exempt from taxation. The
2property of the Panel is exempt from taxation.
 
3    (105 ILCS 5/1H-160 new)
4    Sec. 1H-160. Sanctions.
5    (a) No member, officer, employee, or agent of the district
6may commit the district to any contract or other obligation or
7incur any liability on behalf of the district for any purpose
8if the amount of the contract, obligation, or liability is in
9excess of the amount authorized for that purpose then available
10under the financial plan and budget then in effect.
11    (b) No member, officer, employee, or agent of the district
12may commit the district to any contract or other obligation on
13behalf of the district for the payment of money for any purpose
14required to be approved by the Panel unless the contract or
15other obligation has been approved by the Panel.
16    (c) No member, officer, employee, or agent of the district
17may take any action in violation of any valid order of the
18Panel, may fail or refuse to take any action required by any
19such order, may prepare, present, certify, or report any
20information, including any projections or estimates, for the
21Panel or any of its agents that is false or misleading, or,
22upon learning that any such information is false or misleading,
23may fail promptly to advise the Panel or its agents.
24    (d) In addition to any penalty or liability under any other
25law, any member, officer, employee, or agent of the district

 

 

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1who violates subsection (a), (b), or (c) of this Section is
2subject to appropriate administrative discipline as may be
3imposed by the Panel, including, if warranted, suspension from
4duty without pay, removal from office, or termination of
5employment.
 
6    (105 ILCS 5/1H-165 new)
7    Sec. 1H-165. Abolition of Panel. The Panel shall be
8abolished 10 years after its creation or one year after all its
9obligations issued under the provisions of this Article have
10been fully paid and discharged, whichever comes later. However,
11the State Board, upon recommendation of the Panel and if no
12obligations are outstanding, may abolish the Panel at any time
13after the Panel has been in existence for 3 years. Upon the
14abolition of the Panel, all of its records shall be transferred
15to the State Board and any property of the Panel shall pass to
16and be vested in the State Board.
 
17    (105 ILCS 5/1H-170 new)
18    Sec. 1H-170. Limitations of actions after abolition;
19indemnification; legal representation.
20    (a) Abolition of the Panel pursuant to Section 1H-165 of
21this Code shall bar any remedy available against the Panel, its
22members, employees, or agents for any right or claim existing
23or any liability incurred prior to the abolition, unless the
24action or other proceeding is commenced prior to the expiration

 

 

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1of 2 years after the date of the abolition.
2    (b) The Panel may indemnify any member, officer, employee,
3or agent who was or is a party or is threatened to be made a
4party to any threatened, pending, or completed action, suit, or
5proceeding, whether civil, criminal, administrative, or
6investigative, by reason of the fact that he or she was a
7member, officer, employee, or agent of the Panel, against
8expenses (including attorney's fees, judgments, fines, and
9amounts paid in settlement actually and reasonably incurred by
10him or her in connection with the action, suit, or proceeding)
11if he or she acted in good faith and in a manner that he or she
12reasonably believed to be in or not opposed to the best
13interests of the Panel and, with respect to any criminal action
14or proceeding, had no reasonable cause to believe his or her
15conduct was unlawful. The termination of any action, suit, or
16proceeding by judgment, order, settlement, or conviction or
17upon a plea of nolo contendere or its equivalent, shall not, of
18itself, create a presumption that the person did not act in
19good faith in a manner that he or she reasonably believed to be
20in or not opposed to the best interests of the Panel and, with
21respect to any criminal action or proceeding, had reasonable
22cause to believe that his or her conduct was unlawful.
23    To the extent that a member, officer, employee, or agent of
24the Panel has been successful, on the merits or otherwise, in
25the defense of any such action, suit, or proceeding referred to
26in this subsection (b) or in defense of any claim, issue, or

 

 

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1matter therein, he or she shall be indemnified against
2expenses, including attorney's fees, actually and reasonably
3incurred by him or her in connection therewith. Any such
4indemnification shall be made by the Panel only as authorized
5in the specific case, upon a determination that indemnification
6of the member, officer, employee, or agent is proper in the
7circumstances because he or she has met the applicable standard
8of conduct. The determination shall be made (i) by the Panel by
9a majority vote of a quorum consisting of members who are not
10parties to the action, suit, or proceeding or (ii) if such a
11quorum is not obtainable or, even if obtainable, a quorum of
12disinterested members so directs, by independent legal counsel
13in a written opinion.
14    Reasonable expenses incurred in defending an action, suit,
15or proceeding shall be paid by the Panel in advance of the
16final disposition of the action, suit, or proceeding, as
17authorized by the Panel in the specific case, upon receipt of
18an undertaking by or on behalf of the member, officer,
19employee, or agent to repay the amount, unless it is ultimately
20determined that he or she is entitled to be indemnified by the
21Panel as authorized in this Section.
22    Any member, officer, employee, or agent against whom any
23action, suit, or proceeding is brought may employ his or her
24own attorney to appear on his or her behalf.
25    The right to indemnification accorded by this Section shall
26not limit any other right to indemnification to which the

 

 

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1member, officer, employee, or agent may be entitled. Any rights
2under this Section shall inure to the benefit of the heirs,
3executors, and administrators of any member, officer,
4employee, or agent of the Panel.
5    The Panel may purchase and maintain insurance on behalf of
6any person who is or was a member, officer, employee, or agent
7of the Panel against any liability asserted against him or her
8and incurred by him or her in any such capacity or arising out
9of his or her status as such, whether or not the Panel would
10have the power to indemnify him or her against liability under
11the provisions of this Section.
12    The Panel shall be considered a State agency for purposes
13of receiving representation by the Attorney General. Members,
14officers, employees, and agents of the Panel shall be entitled
15to representation and indemnification under the State Employee
16Indemnification Act.
 
17    Section 99. Effective date. This Act takes effect July 1,
182011.

 

 

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1 INDEX
2 Statutes amended in order of appearance
3    35 ILCS 200/18-50.1
4    35 ILCS 200/18-92
5    35 ILCS 200/18-241
6    105 ILCS 5/1B-8from Ch. 122, par. 1B-8
7    105 ILCS 5/Art. 1H heading
8    new
9    105 ILCS 5/1H-1 new
10    105 ILCS 5/1H-5 new
11    105 ILCS 5/1H-10 new
12    105 ILCS 5/1H-15 new
13    105 ILCS 5/1H-20 new
14    105 ILCS 5/1H-25 new
15    105 ILCS 5/1H-30 new
16    105 ILCS 5/1H-35 new
17    105 ILCS 5/1H-40 new
18    105 ILCS 5/1H-41 new
19    105 ILCS 5/1H-42 new
20    105 ILCS 5/1H-45 new
21    105 ILCS 5/1H-50 new
22    105 ILCS 5/1H-55 new
23    105 ILCS 5/1H-60 new
24    105 ILCS 5/1H-65 new
25    105 ILCS 5/1H-70 new

 

 

SB2149- 45 -LRB097 10095 NHT 50275 b

1    105 ILCS 5/1H-75 new
2    105 ILCS 5/1H-80 new
3    105 ILCS 5/1H-85 new
4    105 ILCS 5/1H-90 new
5    105 ILCS 5/1H-95 new
6    105 ILCS 5/1H-100 new
7    105 ILCS 5/1H-105 new
8    105 ILCS 5/1H-110 new
9    105 ILCS 5/1H-115 new
10    105 ILCS 5/1H-120 new
11    105 ILCS 5/1H-125 new
12    105 ILCS 5/1H-130 new
13    105 ILCS 5/1H-135 new
14    105 ILCS 5/1H-140 new
15    105 ILCS 5/1H-145 new
16    105 ILCS 5/1H-150 new
17    105 ILCS 5/1H-155 new
18    105 ILCS 5/1H-160 new
19    105 ILCS 5/1H-165 new
20    105 ILCS 5/1H-170 new