(65 ILCS 5/8-12-16) (from Ch. 24, par. 8-12-16)
Sec. 8-12-16.
The financially distressed city shall develop, adopt
and submit to the Authority, within 30 days after this Division first
becomes applicable to the city as provided in Section 8-12-4, a revised
Budget for the remaining portion of what is the city's current fiscal year
at the time this Division first becomes applicable to the city as provided
in Section 8-12-4 and, thereafter, an annual Budget for each subsequent
fiscal year. After adoption by the city, the city shall submit each Budget
to the Authority for its approval not later than 60 days prior to the
commencement of the fiscal year to which the Budget relates. The
Authority shall approve or reject the Budget not later than 30 days prior
to the commencement of the fiscal year. No Budget shall have force or
effect without approval of the Authority. Each Budget shall be developed,
submitted, approved and monitored in accordance with the following procedures:
(1) Each Budget submitted by the financially distressed city shall be
based upon revenue estimates approved or prepared by the Authority, as
provided in paragraph (1) of Section 8-12-15.
(2) Each Budget shall contain such information and detail as may
be prescribed by the Authority. Any deficit for a fiscal year or any
portion of a fiscal year to which any Budget relates shall be included as a
current expense item for the succeeding fiscal year.
(3) The Authority shall approve each Budget if, in its judgment,
the Budget is complete with respect to providing a detailed accounting of
revenues and expenditures, is reasonably capable of being achieved, will
meet the requirement set forth in Section 8-12-14, and
will be consistent with the Financial Plan in effect. Otherwise, the
Authority shall reject the Budget. The Authority's review of the Budget
shall be in accordance with generally accepted accounting principles and
standards. No Budget submitted by the financially distressed city shall be
arbitrarily or capriciously rejected by the Authority. Any rejection by the
Authority of any Budget submitted by the city shall be in writing and shall
state the reasons for the rejection. In the event of rejection, the
Authority may prescribe a procedure and standards for revision of the
Budget by the city.
(4) The financially distressed city shall report to the Authority at
such times and such manner as the Authority may direct, concerning the
city's compliance with each Budget. The Authority may review the city's
operations, obtain budgetary data and financial statements, require the
city to produce reports, and have access to any other information in the
possession of the city that the Authority deems relevant. The Authority
may issue recommendations or directives within its powers to the city to
assure compliance with the Budget. The city shall produce such budgetary
data, financial statements, reports and other information and comply with
such directives.
(5) After approval of each Budget, the financially distressed city shall
promptly notify the Authority of any material change in the revenue or
expenditure estimates in the Budget. The city may submit to the Authority,
or the Authority may require the city to submit, a supplemental Budget
based upon revised revenue or expenditure estimates or for any other good
reason. The Authority shall approve or reject each supplemental Budget
pursuant to paragraph (3) of this Section.
(Source: P.A. 86-1211.)
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(65 ILCS 5/8-12-17) (from Ch. 24, par. 8-12-17)
Sec. 8-12-17.
(a) No contract or other obligation shall be entered into
by the financially distressed city unless it is consistent with the
Financial Plan and Budget in effect. No multi-year employment contract or
collective bargaining agreement authorized or entered into by the city in
accordance with applicable statutes and ordinances shall, with respect to
any terms and provisions thereof which are operative after expiration of
the first year of any such contract or agreement, be deemed inconsistent
with a Financial Plan and Budget at any time in effect; provided, however,
that any terms and provisions of a contract or agreement which would
increase expenditures for salaries, benefits or other forms of compensation
after the expiration of the first year of such contract or agreement shall
be contingent upon the attainment of sufficient available revenues,
considering all necessary expenditures, to support such increases.
(b) The Authority may adopt, and from time to time amend,
regulations identifying categories and types of contracts and other
obligations that shall be subject to approval by the Authority and
the procedure for submitting contracts for approval. Each contract or
other obligation that is entered into by the financially distressed city
and that requires approval by the Authority shall contain a provision
stating (i) that it shall not become legally binding on the city unless and
until it has received the approval of the Authority, and (ii) that the
Authority shall approve the contract if, in the Authority's judgment, the
information required to be submitted is complete with respect to the
contract or other obligation being an authorized expenditure within the
Financial Plan and Budget and the contract or other obligation is
consistent with the Financial Plan and Budget in effect. No contract or
other obligation that requires the approval of the Authority shall be
legally binding on the city unless and until it has received the approval
of the Authority. Subject to the foregoing, the prior approval of the
Authority is not required in order for the city to enter into a contract.
(c) The Authority shall approve the contract or obligation if, in
its judgement, the information required to be submitted is complete
and the contract or other obligation is consistent with the Budget and
Financial Plan in effect. Otherwise, the Authority shall reject the
contract or other obligation; provided, however, that any multi-year
employment contract or collective bargaining agreement authorized or
entered into by the city in accordance with applicable statutes and
ordinances shall be approved by the Authority if, in its judgement, the
terms and provisions operative during the first year of such contract
or agreement are consistent with the Budget and Financial Plan in
effect for that period, subject to the limitation that any terms and
provisions of any such contract or agreement which would increase
expenditures for salaries, benefits or other forms of compensation after
the expiration of the first year of the contract or agreement shall be
contingent upon the attainment of sufficient available revenues,
considering all necessary expenditures, to support such increases.
(Source: P.A. 86-1211.)
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(65 ILCS 5/8-12-18) (from Ch. 24, par. 8-12-18)
Sec. 8-12-18.
The financially distressed city shall meet its debt
service obligations as they become due. No other expenditure shall be made
by the city unless it is consistent with the Financial Plan and Budget in
effect.
(Source: P.A. 86-1211.)
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(65 ILCS 5/8-12-19) (from Ch. 24, par. 8-12-19)
Sec. 8-12-19.
The Authority shall appoint and shall have the authority
to remove a financial management officer. The financial management officer
shall have the responsibility for advising on the preparation of the Budget
and Financial Plan of the financially distressed city and for monitoring
expenditures of the city. The financial management officer shall be the
authorized signatory for all expenditures made from the proceeds of any
State loans provided for the benefit of the city pursuant to this Division
or any other law of this State, and for all expenditures made from
financial aid provided for the benefit of the city from Obligations issued
by the Illinois Finance Authority for such purposes
in
accordance with applicable provisions of the Illinois
Finance
Authority Act. The financial management officer shall be an employee of and
shall report to the Authority, may be granted authority by the Authority to
hire a specific number of employees to assist in meeting responsibilities,
and shall have access to all financial data and records of the city which
he or she deems necessary for the proper and efficient exercise of such
responsibilities. Neither the Authority or the financial management
officer shall have any authority to hire, fire or appoint city employees or
to manage the day-to-day operations of the city.
(Source: P.A. 93-205, eff. 1-1-04.)
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(65 ILCS 5/8-12-20) (from Ch. 24, par. 8-12-20)
Sec. 8-12-20.
Upon direction of the Authority, the financially
distressed city shall reorganize its financial accounts and its management
and budgetary systems in whatever manner the Authority deems appropriate to
achieve greater financial responsibility and control. The Authority shall
not have the power to affect the taxing authority or to consolidate or
reduce the restricted debt service funds of the city.
(Source: P.A. 86-1211.)
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(65 ILCS 5/8-12-21) (from Ch. 24, par. 8-12-21)
Sec. 8-12-21.
The Authority in its sole discretion may intercept any
payments that the city from time to time is entitled to receive from any
funds then or thereafter held by the State Treasurer to the credit of the
city or otherwise in the custody of the State Treasurer to the credit of
the city, whether in or outside of the State Treasury, upon the occurrence
of any of the following:
(1) The financially distressed city's initial | ||
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(2) Any Financial Plan or Budget for any subsequent | ||
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(3) The financially distressed city materially | ||
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The intercept shall be made pursuant to written notice given by the
Authority to the State Comptroller and State Treasurer, setting forth the
amount of the intercept, which may be an aggregate amount not exceeding the
sum of the full amount of any outstanding State loans provided for the
benefit of the city pursuant to this Division or any other law of this
State, plus the full amount of all outstanding Obligations issued by the
Illinois Finance Authority on the financially
distressed city's
behalf in accordance with applicable provisions of the Illinois
Finance Authority Act. The State Comptroller and State Treasurer shall pay
to the Authority, from such funds as from time to time are legally
available therefor, the aggregate amount of the intercept, unless the
Authority sooner notifies the State Comptroller and State Treasurer in
writing that no further payments that the city is entitled to receive shall
be intercepted under the provisions of this Section.
(Source: P.A. 93-205, eff. 1-1-04.)
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(65 ILCS 5/8-12-22) (from Ch. 24, par. 8-12-22)
Sec. 8-12-22.
(a) After the Authority has certified to the Governor
that the financially distressed city has completed 10 successive years of
balanced budgets:
(1) The powers and responsibilities granted or | ||
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(2) The provisions of Section 8-12-14 shall continue | ||
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(b) The Authority and the Illinois Finance
Authority
shall review each Budget, audit report and supplemental report filed with
them as provided in paragraph (2) of subsection (a). In the event the
financially distressed city fails to file any Budget or certified copy of
an audit report or supplemental report as provided in paragraph (2) of
subsection (a), or in the event the Illinois Finance
Authority,
after consultation with the Authority, determines that the Budget adopted
by the financially distressed city and filed as provided in paragraph (2)
of subsection (a) is not balanced as required under Section 8-12-14, the
Illinois Finance Authority shall certify such failure
to file, or
failure to adopt a Budget which is balanced as required, to the Governor;
and concurrent with that certification, the Authority established under
Section 8-12-5 and the financially distressed city shall resume the
exercise and performance of their respective powers and responsibilities
pursuant to each Section of this Division.
(c) When the Illinois Finance Authority determines
that
all of its Obligations have been fully paid and discharged or otherwise
provided for, it shall certify that fact to the Governor; and the Authority
established under Section 8-12-5 shall be abolished 30 days after the date
of that certification. Upon abolition of the Authority as provided in this
subsection, this Division shall have no further force or effect upon the
financially distressed city.
(Source: P.A. 93-205, eff. 1-1-04.)
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(65 ILCS 5/8-12-23) (from Ch. 24, par. 8-12-23)
Sec. 8-12-23.
A financially distressed city to which this Division
applies shall remain subject to all other applicable provisions of this
Act, except as limited by this Division; provided, however, that in case of
a conflict between the provisions of this Division and any other provision
of this Act, the provisions of this Division shall control.
(Source: P.A. 86-1211.)
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(65 ILCS 5/8-12-24) (from Ch. 24, par. 8-12-24)
Sec. 8-12-24.
A home rule unit which is a financially distressed city
to which this Division is applicable as provided in Section 8-12-4 may not
employ financial or fiscal accounting or budgetary procedures or systems,
nor place into effect any Financial Plan or Budget, nor enter into any
contract or make any expenditure, nor otherwise conduct its financial and
fiscal affairs or take other action in a manner inconsistent with the
provisions of this Division, until such time as the powers and
responsibilities of the Authority are terminated as provided in Section
8-12-22. This Section is a limitation under subsection (i) of Section 6 of
Article VII of the Illinois Constitution on the concurrent exercise by home
rule units which are financially distressed cities to which this Division
is applicable as provided in Section 8-12-4 of powers and functions
exercised by the State.
(Source: P.A. 86-1211.)
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(65 ILCS 5/Art. 8 Div. 13 heading) DIVISION 13. ASSIGNMENT OF RECEIPTS
(Source: P.A. 100-23, eff. 7-6-17.) |
(65 ILCS 5/8-13-5) Sec. 8-13-5. Definitions. As used in this Article: "Assignment agreement" means an agreement between a transferring unit and an issuing entity for the conveyance of all or part of any revenues or taxes received by the transferring unit from a State entity. "Conveyance" means an assignment, sale, transfer, or other conveyance. "Deposit account" means a designated escrow account established by an issuing entity at a trust company or bank having trust powers for the deposit of transferred receipts under an assignment agreement. "Issuing entity" means (i) a corporation, trust or other entity that has been established for the limited purpose of issuing obligations for the benefit of a transferring unit, or (ii) a bank or trust company in its capacity as trustee for obligations issued by such bank or trust company for the benefit of a transferring unit. "State entity" means the State Comptroller, the State Treasurer, or the Illinois Department of Revenue. "Transferred receipts" means all or part of any revenues or taxes received from a State entity that have been conveyed by a transferring unit under an assignment agreement. "Transferring unit" means a home rule municipality located in the State.
(Source: P.A. 100-23, eff. 7-6-17.) |
(65 ILCS 5/8-13-10) Sec. 8-13-10. Assignment of receipts. (a) Any transferring unit which receives revenues or taxes from a State entity may (to the extent not prohibited by any applicable statute, regulation, rule, or agreement governing the use of such revenues or taxes) authorize, by ordinance, the conveyance of all or any portion of such revenues or taxes to an issuing entity. Any conveyance of transferred receipts shall: (i) be made pursuant to an assignment agreement in exchange for the net proceeds of obligations issued by the issuing entity for the benefit of the transferring unit and shall, for all purposes, constitute an absolute conveyance of all right, title, and interest therein; (ii) not be deemed a pledge or other security interest for any borrowing by the transferring unit; (iii) be valid, binding, and enforceable in accordance with the terms thereof and of any related instrument, agreement, or other arrangement, including any pledge, grant of security interest, or other encumbrance made by the issuing entity to secure any obligations issued by the issuing entity for the benefit of the transferring unit; and (iv) not be subject to disavowal, disaffirmance, cancellation, or avoidance by reason of insolvency of any party, lack of consideration, or any other fact, occurrence, or State law or rule. On and after the effective date of the conveyance of the transferred receipts, the transferring unit shall have no right, title or interest in or to the transferred receipts conveyed and the transferred receipts so conveyed shall be the property of the issuing entity to the extent necessary to pay the obligations issued by the issuing entity for the benefit of the transferring unit, and shall be received, held, and disbursed by the issuing entity in a trust fund outside the treasury of the transferring unit. An assignment agreement may provide for the periodic reconveyance to the transferring unit of amounts of transferred receipts remaining after the payment of the obligations issued by the issuing entity for the benefit of the transferring unit. (b) In connection with any conveyance of transferred receipts, the transferring unit is authorized to direct the applicable State entity to deposit or cause to be deposited any amount of such transferred receipts into a deposit account in order to secure the obligations issued by the issuing entity for the benefit of the transferring unit. Where the transferring unit states that such direction is irrevocable, the direction shall be treated by the applicable State entity as irrevocable with respect to the transferred receipts described in such direction. Each State entity shall comply with the terms of any such direction received from a transferring unit and shall execute and deliver such acknowledgments and agreements, including escrow and similar agreements, as the transferring unit may require to effectuate the deposit of transferred receipts in accordance with the direction of the transferring unit. (c) Not later than the date of issuance by an issuing entity of any obligations secured by collections of transferred receipts, a certified copy of the ordinance authorizing the conveyance of the right to receive the transferred receipts, together with executed copies of the applicable assignment agreement and the agreement providing for the establishment of the deposit account, shall be filed with the State entity having custody of the transferred receipts.
(Source: P.A. 100-23, eff. 7-6-17.) |
(65 ILCS 5/8-13-11) Sec. 8-13-11. Liens for obligations. (a) As used in this Section, "statutory lien" has the meaning given to that term under 11 U.S.C. 101(53) of the federal Bankruptcy Code. (b) Obligations issued by an issuing entity shall be secured by a statutory lien on the transferred receipts received, or entitled to be received, by the issuing entity that are designated as pledged for such obligations. The statutory lien shall automatically attach from the time the obligations are issued without further action or authorization by the issuing entity or any other entity, person, governmental authority, or officer. The statutory lien shall be valid and binding from the time the obligations are executed and delivered without any physical delivery thereof or further act required, and shall be a first priority lien unless the obligations, or documents authorizing the obligations or providing a source of payment or security for those obligations, shall otherwise provide. The transferred receipts received or entitled to be received shall be immediately subject to the statutory lien from the time the obligations are issued, and the statutory lien shall automatically attach to the transferred receipts (whether received or entitled to be received by the issuing entity) and be effective, binding, and enforceable against the issuing entity, the transferring unit, the State entity, the State of Illinois, and their agents, successors, and transferees, and creditors, and all others asserting rights therein or having claims of any kind in tort, contract, or otherwise, irrespective of whether those parties have notice of the lien and without the need for any physical delivery, recordation, filing, or further act. The statutory lien imposed by this Section is automatically released and discharged with respect to amounts of transferred receipts reconveyed to the transferring unit pursuant to Section 8-13-10 of this Code, effective upon such reconveyance. (c) The statutory lien provided in this Section is separate from and shall not affect any special revenues lien or other protection afforded to special revenue obligations under the federal Bankruptcy Code.
(Source: P.A. 100-23, eff. 7-6-17.) |
(65 ILCS 5/8-13-15) Sec. 8-13-15. Pledges and agreements of the State. The State of Illinois pledges to and agrees with each transferring unit and issuing entity that the State will not limit or alter the rights and powers vested in the State entities by this Article with respect to the disposition of transferred receipts so as to impair the terms of any contract, including any assignment agreement, made by the transferring unit with the issuing entity or any contract executed by the issuing entity in connection with the issuance of obligations by the issuing entity for the benefit of the transferring unit until all requirements with respect to the deposit by such State entity of transferred receipts for the benefit of such issuing entity have been fully met and discharged. In addition, the State pledges to and agrees with each transferring unit and each issuing entity that the State will not limit or alter the basis on which the transferring unit's share or percentage of transferred receipts is derived, or the use of such funds, so as to impair the terms of any such contract. Each transferring unit and issuing entity is authorized to include these pledges and agreements of the State in any contract executed and delivered as described in this Article. In no way shall the pledge and agreements of the State be interpreted to construe the State as a guarantor of any debt or obligation subject to an assignment agreement under this Division.
(Source: P.A. 100-23, eff. 7-6-17.) |
(65 ILCS 5/8-13-20) Sec. 8-13-20. Home rule. A home rule unit may not enter into assignment agreements in a manner inconsistent with the provisions of this Article. This Section is a limitation under subsection (i) of Section 6 of
Article VII of the Illinois Constitution on the concurrent exercise by home rule units of
powers and functions exercised by the State.
(Source: P.A. 100-23, eff. 7-6-17.) |