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|[ Introduced ]||[ Engrossed ]||[ Enrolled ]|
|[ House Amendment 003 ]|
90_SB0747ham002 LRB9001850KDdvam01 1 AMENDMENT TO SENATE BILL 747 2 AMENDMENT NO. . Amend Senate Bill 747 by replacing 3 the title with the following: 4 "AN ACT concerning State finance."; and 5 by replacing everything after the enacting clause with the 6 following: 7 "Section 1. Short title. This Act may be cited as the 8 Real Estate Leasing Act. 9 Section 5. Applicability. 10 (a) All leases of real property for use of State 11 agencies, authorities, boards, commissions, departments, 12 institutions, bodies politic, and all other administrative 13 units or outgrowths of the executive branch of State 14 government except the Constitutional officers, the State 15 Board of Education, and the State colleges and universities 16 and their governing bodies shall be procured in accordance 17 with the provisions of this Act. 18 (b) Notwithstanding anything to the contrary in this 19 Act, the purchase of real estate in fee simple or less than 20 fee simple, including by lease purchase, is not subject to 21 this Act, but shall be purchased in accordance with law and -2- LRB9001850KDdvam01 1 rules established outside this Act. 2 (c) For purposes of this Act, "Director" shall mean the 3 Director of Central Management Services. 4 Section 10. Leases. The Director shall have the 5 authority to procure leases for real property. 6 Section 15. Method of source selection. 7 (a) Request for information. Except as provided in 8 subsections (b) and (c) of this Section, all leases of real 9 property shall be awarded by a request for information 10 process in accordance with Section 20 of this Act. 11 (b) Other methods. A request for information process 12 need not be used and the procurement may be negotiated in the 13 following situations: 14 (1) renewal or extension of existing leases, 15 (2) temporary space as defined by rule, 16 (3) specialized space available at only one 17 location and parking, 18 (4) emergency, when there exists a threat to public 19 health or public safety, or when immediate expenditure is 20 necessary for repairs to State property in order to 21 protect against further loss of or damage to State 22 property, to prevent or minimize serious disruption in 23 State services, or to ensure the integrity of State 24 records. Emergency procurements shall be made with as 25 much competition as is practical under the circumstances 26 and shall be reported in the manner prescribed in 27 paragraph (3) of subsection (a) of Section 6 of the 28 Illinois Purchasing Act. 29 (c) Leases with governmental units. Leases with other 30 governmental units may be negotiated without using the 31 request for information process when deemed by the Director 32 to be in the best interest of the State. -3- LRB9001850KDdvam01 1 Section 20. Request for information. 2 (a) Contents. A request for information shall be issued 3 and shall include: 4 (1) the type of property to be leased; 5 (2) the proposed uses of the property; 6 (3) the duration of the lease; 7 (4) the preferred location of the property; and 8 (5) a general description of the configuration 9 desired. 10 (b) Public notice. Public notice of the request for 11 information shall be published in a newspaper of general 12 circulation in each community where the using agency is 13 seeking space. The advertisement shall be published at least 14 14 days before the deadline for submission of responses to 15 the request for information. As an alternative, the Director 16 may authorize publication in electronic form. 17 (c) Response. The response to the request for 18 information shall consist of written information sufficient 19 to show that the respondent can meet minimum criteria set 20 forth in the request. The Director may enter into 21 discussions with respondents for the purpose of clarifying 22 State needs and the information supplied by the respondents. 23 On the basis of the information supplied and discussions, if 24 any, the Director shall make a written determination 25 identifying the responses that meet the minimum criteria set 26 forth in the request for information. Negotiations shall be 27 entered into with all qualified respondents for the purpose 28 of securing a lease that is in the best interest of the 29 State. A written report of the negotiations shall be 30 retained in the lease files and shall include the reasons for 31 the final selection. All leases shall be reduced to writing 32 and filed in accordance with law. 33 Section 25. Other selection procedures. Nothing in this -4- LRB9001850KDdvam01 1 Act shall prohibit the Director from using more restrictive 2 competitive selection procedures. 3 Section 30. Rent without occupancy. Except when deemed 4 by the Director to be in the best interest of the State, no 5 State agency may incur rental obligations before occupying 6 the space rented. 7 Section 35. Local site preferences. Upon the request of 8 the chief executive officer of a unit of local government, 9 leasing preferences may be given to sites located in 10 enterprise zones, tax increment districts, or redevelopment 11 districts when deemed to be in the best interest of the 12 State. 13 Section 40. Purchase option. For initial leases of all 14 space in a free-standing building, the Director shall 15 consider whether a purchase option exerciseable by the State 16 would be appropriate. The Director's determination shall be 17 documented in the lease file. 18 Section 80. The Civil Administrative Code of Illinois is 19 amended by changing Section 67.02 as follows: 20 (20 ILCS 405/67.02) (from Ch. 127, par. 63b13.2) 21 Sec. 67.02. (a) To lease or purchase office and storage 22 space, buildings, land and other facilities for all State 23 agencies, authorities, boards, commissions, departments, 24 institutions, bodies politic and all other administrative 25 units or outgrowths of the executive branch of State 26 government except the Constitutional officers, the State 27 Board of Education and the State colleges and universities 28 and their governing bodies. However, before leasing or 29 purchasing any office or storage space, buildings, land or -5- LRB9001850KDdvam01 1 other facilities in any municipality the Department shall 2 survey the existing State-owned and State-leased property to 3 make a determination of need. Such leases shall be for a 4 term not to exceed 5 years, except that such leases may 5 contain a renewal clause subject to acceptance by the State 6 after that date or an option to purchase. Such purchases 7 shall be made through contracts which may provide for the 8 title to the property to transfer immediately to the State or 9 a trustee or nominee for the benefit of the State and which 10 shall: provide for the consideration to be paid in 11 installments to be made at stated intervals during a certain 12 term not to exceed 30 years from the date of the contract and 13 may provide for the payment of interest on the unpaid balance 14 at a rate that does not exceed a rate determined by adding 3 15 percentage points to the annual yield on United States 16 Treasury obligations of comparable maturity as most recently 17 published in the Wall Street Journal at the time such 18 contract is signed. Such leases and purchase contracts shall 19 be and shall recite that they are subject to termination and 20 cancellation in any year for which the General Assembly fails 21 to make an appropriation to pay the rent or purchase 22 installments payable under the terms of the lease or purchase 23 contract. Additionally such purchase contract shall specify 24 that title to the office and storage space, buildings, land 25 and other facilities being acquired under such a contract 26 shall revert to the Seller in the event of the failure of 27 the General Assembly to appropriate suitable funds. 28 However, this limitation on the term of such leases does not 29 apply to leases to and with the Illinois Building Authority, 30 as provided for in the Act enacted by the Seventy-second 31 General Assembly entitled the Building Authority Act, which 32 leases to and with said Authority may be entered into for a 33 term not to exceed 30 years and shall be and shall recite 34 that they are subject to termination and cancellation in any -6- LRB9001850KDdvam01 1 year for which the General Assembly fails to make an 2 appropriation to pay the rent payable under the terms of such 3 lease. These limitations do not apply where the lease or 4 purchase contract contains a provision limiting the liability 5 for the payment of the rentals or installments thereof solely 6 to funds received from the Federal government. 7 (b) To lease from an airport authority office, aircraft 8 hangar and service buildings constructed upon a public 9 airport under the Airport Authorities Act for the use and 10 occupancy of the State Department of Transportation, which 11 lease may be entered into for a term not to exceed 30 years. 12 (c) To establish training programs for teaching State 13 leasing procedures and practices to new employees of the 14 Department and to keep all employees of the Department 15 informed about current leasing practices and developments in 16 the real estate industry. 17 (d) To enter into an agreement with a municipality or 18 county to construct, remodel or convert a structure for the 19 purposes of its serving as a correctional institution or 20 facility pursuant to paragraph (c) of Section 3-2-2 of the 21 Unified Code of Corrections. 22 (e) To enter into an agreement with a private 23 individual, trust, partnership or corporation or a 24 municipality or other unit of local government, when 25 authorized to do so by the Department of Corrections, whereby 26 such individual, trust, partnership or corporation or 27 municipality or other unit of local government will 28 construct, remodel or convert a structure for the purposes of 29 its serving as a correctional institution or facility and 30 then lease such structure to the Department for the use of 31 the Department of Corrections. A lease entered into pursuant 32 to the authority granted in this subsection shall be for a 33 term not to exceed 30 years, but may grant to the State the 34 option to purchase the structure outright. -7- LRB9001850KDdvam01 1 Such leases shall be and shall recite that they are 2 subject to termination and cancellation in any year for which 3 the General Assembly fails to make an appropriation to pay 4 the rent payable under the terms of the lease. 5 (f) On and after September 17, 1983, the powers granted 6 to the Department under this Section shall be exercised 7 exclusively by the Department and no other State agency may 8 concurrently exercise any such power, unless specifically 9 authorized otherwise by a later enacted law. This subsection 10 is not intended to impair any contract existing as of 11 September 17, 1983. 12 However, no lease for more than 10,000 square feet of 13 space shall be executed unless the Director in consultation 14 with the Executive Director of the Capital Development Board 15 has certified that leasing is in the best interest of the 16 State, considering programmatic requirements, availability of 17 vacant State-owned space, the cost-benefits of purchasing or 18 constructing new space and other criteria as he shall 19 determine. The Director shall not permit multiple leases for 20 less than 10,000 square feet to be executed in order to evade 21 this provision. 22 (g) To develop and implement, in cooperation with the 23 Interagency Energy Conservation Committee, a system for 24 evaluating energy consumption in facilities leased by the 25 Department, and to develop energy consumption standards for 26 use in evaluating prospective lease sites. 27 (h) (1) After the effective date of this amendatory Act 28 of 1997, the Department shall not enter into an agreement 29 for the installment purchase or lease purchase of 30 buildings, land, or facilities unless: 31 (A) the using agency certifies to the 32 Department that the agency reasonably expects the 33 building, land, or facilities being considered for 34 purchase will meet a permanent space need; -8- LRB9001850KDdvam01 1 (B) the building or facilities will be 2 substantially occupied by State agencies after 3 purchase (or after acceptance in the case of a build 4 to suit); 5 (C) the building or facilities shall be in new 6 or like new condition and have a remaining economic 7 life exceeding the term of the contract; 8 (D) no structural or other major building 9 component or system shall have a remaining economic 10 life of less than 10 years; 11 (E) the building, land or facilities: 12 (i) is free of any identifiable 13 environmental hazard, or 14 (ii) is subject to a management plan, 15 provided by the seller and acceptable to the 16 State, to address the known environmental 17 hazard; 18 (F) the building, land, or facilities satisfy 19 applicable handicap accessibility and applicable 20 building codes; and 21 (G) the State's cost to lease purchase or 22 installment purchase the building, land, or 23 facilities is less than the cost to lease space of 24 comparable quality, size, and location over the 25 lease purchase or installment purchase term. 26 (2) The Department shall establish the methodology 27 for comparing lease costs to the costs of installment or 28 lease purchases. The cost comparison shall take into 29 account all relevant cost factors including, but not 30 limited to, debt service, operating and maintenance 31 costs, insurance and risk costs, real estate taxes, 32 reserves for replacement and repairs, security costs, and 33 utilities. Such methodology shall also provide: 34 (A) that the comparison will be made using -9- LRB9001850KDdvam01 1 level payment plans; and 2 (B) that a purchase price must not exceed the 3 fair market value of the buildings, land, or 4 facilities, and that such price must be 5 substantiated by an appraisal or by a competitive 6 selection process. 7 (3) If the Department intends to enter into an 8 installment purchase or lease purchase agreement for 9 buildings, land, or facilities under circumstances that 10 do not satisfy the conditions specified by this Section, 11 it must issue a notice to the Secretary of the Senate and 12 the Clerk of the House. Such notice shall contain (i) 13 specific details of the State's proposed purchase, 14 including the amounts, purposes, and financing terms; 15 (ii) a specific description of how the proposed purchase 16 varies from the procedures set forth in this Section; and 17 (iii) a specific justification, signed by the Director, 18 of why it is in the State's best interests to proceed 19 with the purchase. The Department may not proceed with 20 such an installment purchase or lease purchase agreement 21 if, within 60 calendar days after delivery of the notice, 22 the General Assembly, by joint resolution, disapproves 23 the transaction. Delivery may take place on a day and at 24 an hour when the Senate and House are not in session so 25 long as the offices of Secretary and Clerk are open to 26 receive the notice. In determining the 60 day period 27 within which the General Assembly must act, the day on 28 which delivery is made to the Senate and House shall not 29 be counted. If delivery of the notice to the 2 houses 30 occurs on different days, the 60 day period shall begin 31 on the day following the later delivery. 32 (4) On or before February 15 of each year, the 33 Department shall submit an annual report to the Director 34 of the Bureau of the Budget and the General Assembly -10- LRB9001850KDdvam01 1 regarding installment purchases or lease purchases of 2 buildings, land, or facilities that were entered into 3 during the preceding calendar year. The report shall 4 include a summary statement of the aggregate amount of 5 the State's obligations under such purchases; specific 6 details pertaining to each purchase, the amounts, 7 purposes, and financing terms and payment schedule for 8 each purchase; and any other matter that the Department 9 deems advisable. 10 The requirement for reporting to the General 11 Assembly shall be satisfied by filing copies of the 12 report with the Auditor General, the Speaker, the 13 Minority Leader, and the Clerk of the House of 14 Representatives and the President, the Minority Leader, 15 and the Secretary of the Senate, the Chairs of the 16 Appropriations Committees, and the Legislative Research 17 Unit, as required by Section 3.1 of the General Assembly 18 Organization Act, and filing such additional copies with 19 the State Government Report Distribution Center for the 20 General Assembly as is required under paragraph (t) of 21 Section 7 of the State Library Act. 22 (Source: P.A. 87-852.) 23 Section 90. The State Finance Act is amended by changing 24 Section 9 as follows: 25 (30 ILCS 105/9) (from Ch. 127, par. 145) 26 Sec. 9. (a) No disbursements from appropriations shall 27 be made for rental or purchase of office or other space, 28 buildings or land, except in pursuance of a written lease or 29 purchase contract entered into by the proper State authority 30 and the owner or authorized agent of the property. Such lease 31 shall not exceed 5 years unless a greater term is authorized 32 by law, but such lease may contain a renewal clause subject -11- LRB9001850KDdvam01 1 to acceptance by the State after that date or an option to 2 purchase. Such purchase contract may provide for the title to 3 the property to transfer immediately to the State or a 4 trustee or nominee for the benefit of the State and for the 5 consideration to be paid in installments to be made at stated 6 intervals during a certain term not to exceed 30 years from 7 the date of the contract and may provide for the payment of 8 interest on the unpaid balance at a rate that does not exceed 9 a rate determined by adding 3 percentage points to the annual 10 yield on United States Treasury obligations of comparable 11 maturity as most recently published in the Wall Street 12 Journal at the time such contract is signed. Such lease or 13 purchase contract shall be and shall recite that it is 14 subject to termination and cancellation in any year for which 15 the General Assembly fails to make an appropriation to pay 16 the rent or purchase installments payable under the terms of 17 such lease or purchase contract. Additionally such purchase 18 contract shall specify that title to the office and storage 19 space, buildings, land and other facilities being acquired 20 under such a contract shall revert to the Seller in the event 21 of the failure of the General Assembly to appropriate 22 suitable funds. This limitation does not apply to leases for 23 office or other space, buildings, or land, where such leases 24 or purchase contracts contain a provision limiting the 25 liability for the payment of the rental or installments 26 thereunder solely to funds received from the Federal 27 Government. A copy of each such lease or purchase contract 28 shall be filed in the office of the Secretary of State within 29 15 days after execution. 30 (b) The State, through the Bureau of the Budget for real 31 property and improvements and personal property related 32 thereto, and through the Department of Central Management 33 Services for personal property, may issue or cause to be 34 issued certificates of participation or similar instruments -12- LRB9001850KDdvam01 1 representing the right to receive a proportionate share in 2 lease-purchase or installment purchase payments to be made by 3 or for the benefit of one or more State agencies for the 4 acquisition or improvement of real or personal property, or 5 refinancing of such property or payment of expenses related 6 to the issuance. The total principal amount of the 7 certificates issued or caused to be issued pursuant to this 8 Section for acquisition of real property shall not exceed 9 $125,000,000. Certificates issued or caused to be issued 10 pursuant to this Section shall mean certificates heretofore 11 or hereafter signed and delivered by the State or signed and 12 delivered by a trustee or fiscal agent pursuant to the 13 written direction of the State. Nothing in this Section 14 shall (i) prohibit or restrict the issuance of or affect the 15 validity or enforceability of certificates heretofore or 16 hereafter signed and delivered by any lessor or seller or an 17 assignee of either under a lease purchase or installment 18 purchase contract with the State or signed and delivered by a 19 trustee or fiscal agent pursuant to the written direction of 20 such lessor or seller or an assignee of either, or (ii) 21 affect the validity or enforceability of any such lease 22 purchase or installment purchase contract. 23 (1) Certificates may be issued or caused to be issued 24 pursuant to this Section if the Director of the Bureau of the 25 Budget determines that it is financially desirable and in the 26 best interest of the State to use certificates of 27 participation to finance or refinance installment purchase or 28 lease purchase contracts entered into by State departments, 29 agencies, or universities or to refund or advance refund 30 prior issuances of certificates of participation or similar 31 instruments including certificates of participation issued 32 under this Section and certificates of participation issued 33 before the effective date of this amendatory Act of 1997
the34 State determines that the use of certificates of-13- LRB9001850KDdvam01 1 participation is financially desirable and in the best2 interest of the State. The State, through the Bureau of the 3 Budget for real property and improvements and personal 4 property related thereto, and through the Department of 5 Central Management Services for personal property, may enter 6 into arrangements for issuing, securing, and marketing 7 certificates of participation, including agreements, trust 8 indentures and other arrangements necessary or desirable to 9 carry out the foregoing, and any reserve funds or other 10 amounts securing the certificates may be held and invested as 11 provided in such agreements and trust indentures. 12 (2) Certificates of participation or similar instruments 13 issued or caused to be issued pursuant to this Section and 14 the underlying lease purchase lease-purchaseor installment 15 purchase contracts shall not constitute or create debt of the 16 State as defined in the Illinois Constitution, nor a 17 contractual obligation in excess of the amounts appropriated 18 therefor, and the State shall have no continuing obligation 19 to appropriate money for said payments or other obligations 20 due under the lease purchase lease-purchaseor installment 21 purchase contracts; provided, however, that the Governor 22 shall include in the annual budget request to the General 23 Assembly for each relevant fiscal year appropriations 24 sufficient to permit payment of all amounts which will be due 25 and payable during the fiscal year with respect to 26 certificates of participation issued or caused to be issued 27 pursuant to this Section. 28 (3) The maximum term of certificates of participation 29 issued to finance personal property shall be 10 years. The 30 maximum term of certificates of participation to finance the 31 acquisition or improvement of real property shall be 25 32 years. In no event, however, shall the term exceed the 33 expected useful life of the property being financed, with the 34 term calculated from the date of delivery, with respect to -14- LRB9001850KDdvam01 1 personal property, and the date of occupancy, with respect to 2 real property. 3 (4) Ten days before the issuance of certificates of 4 participation under this Section, the Director of the Bureau 5 of the Budget for real property and improvements and personal 6 property related thereto and the Department of Central 7 Management Services for personal property shall transmit to 8 the Executive Director of the Economic and Fiscal Commission, 9 to the Auditor General, to the President of the Senate, the 10 Minority Leader of the Senate, the Speaker of the House of 11 Representatives, and the Minority Leader of the House of 12 Representatives, to the Chairs of the Appropriations 13 Committees, and to the Secretary of the Senate and Clerk of 14 the House a notice providing the following information 15 pertaining to the property to be financed by the 16 certificates: 17 (1) The agency and program procuring the property. 18 (2) A brief description of the property. 19 (3) The estimated cost of the property if purchased 20 outright. 21 (4) The estimated terms of the financings. 22 (5) The estimated total lease or installment 23 purchase payments for property. 24 (6) The estimated lease or installment purchase 25 payments by fiscal year for the current fiscal year and 26 the next 5 fiscal years. 27 (7) The anticipated source of funds to make lease 28 or installment purchase payments. 29 (8) Those items not anticipated to be financed upon 30 enactment of the budget for the fiscal year. 31 A copy of the Preliminary Official Statement shall also 32 be transmitted to the Executive Director of the Economic and 33 Fiscal Commission, to the Auditor General, to the President 34 of the Senate, the Minority Leader of the Senate, the Speaker -15- LRB9001850KDdvam01 1 of the House of Representatives, the Minority Leader of the 2 House of Representatives, to the Chairs of the Appropriations 3 Committees, and to the Secretary of the Senate and Clerk of 4 the House at the time it is submitted for publication. After 5 the issuance of the certificates, a copy of the final 6 official statement accompanying the issuance shall be filed 7 with the Economic and Fiscal Commission, with the Auditor 8 General, with the President of the Senate, the Minority 9 Leader of the Senate, the Speaker of the House of 10 Representatives, and the Minority Leader of the House of 11 Representatives, with the Chairs of the Appropriations 12 Committees, and with the Secretary of the Senate and Clerk of 13 the House. 14 (5) The Bureau of the Budget may, based on a cost 15 benefit analysis, issue general obligation bonds to finance 16 or refinance installment purchase or lease purchase contracts 17 entered into by State departments, agencies, or universities 18 or to refund or advance refund prior issuances of 19 certificates of participation or similar instruments, 20 including certificates of participation issued under this 21 Section and certificates of participation issued before the 22 effective date of this amendatory Act of 1997. 23 (6) (3)The Department of Central Management Services 24 may promulgate rules governing its issuance and conditions of 25 use of certificates of participation and similar instruments. 26 (c) Amounts paid from appropriations for personal 27 service of any officer or employee of the State, either 28 temporary or regular, shall be considered as full payment for 29 all services rendered between the dates specified in the 30 payroll or other voucher and no additional sum shall be paid 31 to such officer or employee from any lump sum appropriation, 32 appropriation for extra help or other purpose or any 33 accumulated balances in specific appropriations, which 34 payments would constitute in fact an additional payment for -16- LRB9001850KDdvam01 1 work already performed and for which remuneration had already 2 been made, except that wage payments made pursuant to the 3 application of the prevailing rate principle or based upon 4 the effective date of a collective bargaining agreement 5 between the State, or a State agency and an employee group, 6 or payment of funds as an adjustment to wages paid employees 7 or officers of the State for the purpose of correcting a 8 clerical or administrative error or oversight or pursuant to 9 a backpay order issued by an appropriate State or federal 10 administrative or judicial body or officer shall not be 11 construed as an additional payment for work already 12 performed. 13 (d) Disbursements from appropriations which are subject 14 to the approval or certification of the Department of Central 15 Management Services are subject to the following 16 restrictions. 17 Payments for personal service except for positions 18 specified in all appropriation Acts shall be made in 19 conformity with schedules and amendments thereto submitted by 20 the respective officers and approved by the Department of 21 Central Management Services before becoming effective. Such 22 schedules and amendments thereto may set up groups of 23 employment showing the approximate number to be employed, 24 with fixed or minimum and maximum salary rates. 25 This Section is subject to the provisions of Section 26 9.02. 27 (Source: P.A. 86-11; 86-657; 86-1028.)".
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