State of Illinois
91st General Assembly
Legislation

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91_HB0077

 
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 1        AN ACT concerning long term health care.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 1.  Short title.  This Act may be  cited  as  the
 5    Elder Care Savings Bond Act.

 6        Section  5.   Declaration of purpose.  It is declared (i)
 7    that for the benefit of the people of the State of  Illinois,
 8    the  conduct  and  increase of their commerce, the protection
 9    and  enhancement  of  their  welfare,  the   development   of
10    continued prosperity, and the improvement of their health and
11    living  conditions,  it  is  essential  that  this and future
12    generations be given the fullest opportunity to  provide  for
13    their  long  term  health care needs and (ii) that to achieve
14    these ends it is  of  the  utmost  importance  that  Illinois
15    residents be provided with investment alternatives to enhance
16    their  financial  access to long term health care.  It is the
17    intent of this Act to provide to the  State  of  Illinois  an
18    alternative  low  cost  method  of borrowing for the purposes
19    authorized in the General Obligation Bond Act and to  enhance
20    financial  access  to long term health care, all in execution
21    of the public policy set forth in this Section.

22        Section 10.  Definitions.  In this Act:
23        (a)(1)  "Assisted      living      establishment"      or
24    "establishment" means a home,  building,  residence,  or  any
25    other place where the services described below are provided:
26             (A)  community-based   residential  care,  including
27        housing and  personal  and  health-related  services,  to
28        persons who need help with activities of daily living;
29             (B)  supportive   and   intermittent  health-related
30        services that are available 24 hours per day, if  needed,
 
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 1        to meet scheduled and unscheduled needs of a tenant, in a
 2        way  that  promotes  self-direction  and participation in
 3        decisions that   emphasize  independence,  individuality,
 4        privacy, and dignity in a residential surrounding;
 5             (C)  sleeping accommodations for 3 or more unrelated
 6        adult  tenants, at least 80 percent of which are 55 years
 7        of age or older; and
 8             (D)  all Group 1 services and one or  more  Group  2
 9        services,  whether provided directly by the establishment
10        or by another entity arranged for  by  the  establishment
11        with    the   consent   of   the   tenant   or   tenant's
12        representative.
13             An    "assisted     living     establishment"     or
14        "establishment"  also  means a home, building, residence,
15        or any other place that provides the  services  of  items
16        (A)  through (D) of this paragraph, and, in addition, any
17        Group 3 services.
18        (2)  "Assisted living establishment"  or  "establishment"
19    does not mean:
20             (A)  a  home, institution, or similar place operated
21        by the federal government or the State of Illinois;
22             (B)  a "long term care facility" licensed under  the
23        Nursing Home Care Act. However, a long term care facility
24        may  apply  under  this  Act  to  convert sections of the
25        facility to  assisted  living.  If  the  long  term  care
26        facility  elects  to  do  so,  the  facility  retains the
27        Certificate of  Need  for  its  nursing  beds  that  were
28        converted;
29             (C)  a  hospital,  sanitarium, or other institution,
30        the principal  activity  or  business  of  which  is  the
31        diagnosis,  care, and treatment of human illness and that
32        is required to be licensed under the  Hospital  Licensing
33        Act;
34             (D)  a  "facility  for child care" as defined in the
 
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 1        Child Care Act of 1969;
 2             (E)  a "community living facility" as defined in the
 3        Community Living Facilities Licensing Act;
 4             (F)  a  "community   residential   alternative"   as
 5        defined   in   the   Community  Residential  Alternatives
 6        Licensing Act;
 7             (G)  a nursing home or sanitarium operated solely by
 8        and for persons who rely exclusively  upon  treatment  by
 9        spiritual  means  through  prayer, in accordance with the
10        creed or tenants of a well-recognized church or religious
11        denomination;
12             (H)  a facility licensed by the Department of  Human
13        Services  as  a "community-integrated living arrangement"
14        as   defined   in   the    Community-Integrated    Living
15        Arrangements Licensure and Certification Act;
16             (I)  a  "supportive  residence"  licensed  under the
17        Supportive Residences Licensing Act;
18             (J)  a "life care facility" as defined in  the  Life
19        Care Facilities Act; and
20             (K)  a freestanding hospice facility.
21        (3)  For  the  purposes  of  this  subsection,  "Group  1
22    services" include the  following:
23             (A)  meals  provided  in  a  dining    room  or  the
24        tenant's  own  room and prepared  by the establishment or
25        an outside contractor;
26             (B)  housekeeping  services,   including   but   not
27        limited  to  vacuuming, dusting, and cleaning the kitchen
28        and bathrooms of the  tenant's unit;
29             (C)  security provided 24 hours each day,  including
30        but  not  limited  to  locked  entrances   or building or
31        contract security personnel;
32             (D)  an  emergency  communication  response  system,
33        which is a procedure in place 24 hours each day by  which
34        a  tenant  can  notify  building management, an emergency
 
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 1        response vendor, or others able to respond to his or  her
 2        need for assistance.
 3        (4)  For  the  purposes  of  this  subsection,  "Group  2
 4    services" include the following:
 5             (A)  personal  care,  including  one  or more of the
 6        following:  assistance with bathing, dressing,  grooming,
 7        ambulating,  toileting,  transferring, meal planning, and
 8        personal laundry;
 9             (B)  medication management, including one or more of
10        the following:  reminders to take medication,  monitoring
11        of   tenant  medications,  storage  of  medications,  and
12        assisting tenants with medications set  up  by  a  family
13        member or nurse;
14             (C)  intermittent  health services, including one or
15        more  of  the  following:    medication   administration,
16        dressing  changes,  catheter  care,  therapies, and other
17        medical, nursing,  or  rehabilitative  care  provided  by
18        personnel licensed under the Home Health Agency Licensing
19        Act and by the Department of Professional Regulation.
20        (5)  For  the  purposes  of  this  subsection,  "Group  3
21    services" include the following:
22             (A)  transportation,  including  but  not limited to
23        car or van service for shopping and medical appointments;
24             (B)  a health assessment, which is a health history,
25        physical  examination,  risk  profile,  or  screening  by
26        licensed health care personnel;
27             (C)  counseling for  health,  social  services,  and
28        nutrition  by licensed personnel;
29             (D)  social or educational activities, including but
30        not  limited  to trips, classes, lectures, and parties in
31        or outside the establishment.
32        (6)  For the purposes of this subsection, "tenant"  means
33    a person residing in an assisted living establishment.
34        (b)  "Authority" means the Elder Care Trust Authority.
 
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 1        (c)  "Elder  Care Savings Bonds" means general obligation
 2    bonds of the State issued under the General  Obligation  Bond
 3    Act  in  accordance  with  this Act and designated as General
 4    Obligation Elder Care Savings Bonds.

 5        Section 15.  Issuance and sale of bonds.
 6        (a)  In  order  to  provide  investors  with   investment
 7    alternatives  to  enhance their financial access to long term
 8    health care, and in furtherance of the public policy of  this
 9    Act,  bonds  authorized  by  the  provisions  of  the General
10    Obligation Bond Act, in a total aggregate original  principal
11    amount  not  to exceed $300,000,000 may be issued and sold in
12    fiscal year 2000 and the following fiscal years, from time to
13    time, and as often as  practicable,  as  Elder  Care  Savings
14    Bonds   in   amounts   directed   by   the   Governor,   upon
15    recommendation  by  the Director of the Bureau of the Budget.
16    Bonds to be issued and sold as Elder Care Savings Bonds shall
17    be designated by the Governor and the Director of the  Bureau
18    of  the  Budget  as  "General  Obligation  Elder Care Savings
19    Bonds" in the proceedings authorizing the issuance  of  those
20    bonds and shall be subject to all of the terms and provisions
21    of  the  General  Obligation Bond Act, except that Elder Care
22    Savings Bonds may bear interest payable at a  time  or  times
23    and  may  be  sold at prices and in a manner as determined by
24    the Governor and the Director of the Bureau of the Budget and
25    except as otherwise provided in this Act.
26        (b)  If Elder Care Savings Bonds are sold at public sale,
27    the public sale procedures shall be as set forth  in  Section
28    11  of  the  General Obligation Bond Act.  Elder Care Savings
29    Bonds may be sold at negotiated sale if the Director  of  the
30    Bureau  of  the Budget determines that a negotiated sale will
31    result in either a more efficient and economic  sale  of  the
32    bonds  or  greater  access  to the bonds by investors who are
33    residents of the  State  of  Illinois.   If  any  Elder  Care
 
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 1    Savings  Bonds are sold at a negotiated sale, the underwriter
 2    or underwriters to which the bonds  are  sold  shall  (i)  be
 3    organized,  incorporated,  or  have  their principal place of
 4    business in the State of Illinois or (ii) in the judgment  of
 5    the  Director  of  the  Bureau of the Budget, have sufficient
 6    capability to make a  broad  distribution  of  the  bonds  to
 7    investors who reside in the State of Illinois.
 8        (c)  In  determining  the  aggregate  principal amount of
 9    Elder Care Savings Bonds that has  been  issued  pursuant  to
10    this  Act,  the  aggregate original principal amount of those
11    bonds issued and sold shall be taken into account.
12        (d)  Any bond issued under this Act shall be  payable  in
13    one  payment  on  a  fixed  date, unless the Governor and the
14    Director of the Bureau of the Budget determine otherwise.

15        Section 20.  Security of bonds.
16        (a)  Any  Elder  Care  Savings  Bonds  issued  under  the
17    General Obligation Bond Act in accordance with this Act shall
18    be direct, general obligations of the State of  Illinois  and
19    subject  to  repayment  as provided in the General Obligation
20    Bond Act.   In  the  proceedings  of  the  Governor  and  the
21    Director of the Bureau of the Budget authorizing the issuance
22    of  Elder  Care  Savings  Bonds, however, those officials may
23    covenant on behalf of the State with or for  the  benefit  of
24    the holders of those bonds as to all matters deemed advisable
25    by  those  officials,  including the terms and conditions for
26    creating and maintaining sinking funds,  reserve  funds,  and
27    other special funds created in those proceedings separate and
28    apart  from all other funds and accounts of the State.  Those
29    officials  may  make  other  covenants  deemed  necessary  or
30    desirable to assure the prompt payment of  the  principal  of
31    and interest on the bonds.
32        (b)  The transfers to and appropriations from the General
33    Obligation  Bond Retirement and Interest Fund required by the
 
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 1    General Obligation Bond Act shall be made  at  times  and  in
 2    amounts as determined by the Governor and the Director of the
 3    Bureau  of  the Budget and shall be made to and from any fund
 4    or funds created pursuant to this Section for the payment  of
 5    the  principal  of  and  interest  on  any Elder Care Savings
 6    Bonds.

 7        Section 25.  Compelling payment; remedies of bondholders.
 8        (a)  If the State  fails  to  pay  the  principal  of  or
 9    interest  on any Elder Care Savings Bonds or premium, if any,
10    as those amounts become due, or fails to  make  any  required
11    monthly  transfer of moneys to provide for the payment of the
12    principal, interest, or premium on the bonds, a civil  action
13    to  compel  payment may be instituted in the Supreme Court of
14    Illinois as a court of original jurisdiction by the holder or
15    holders of the Elder Care Savings Bonds with respect to which
16    the default of payment or failure to make a required transfer
17    exists.  Delivery of a summons and a copy of the complaint to
18    the Attorney General constitutes sufficient service  to  give
19    the  Supreme  Court  of  Illinois jurisdiction of the subject
20    matter of the suit and jurisdiction over the  State  and  its
21    officers  named  as  defendants for the purpose of compelling
22    the payment or transfer.  Any case, controversy, or cause  of
23    action  concerning  the  validity  of this Act relates to the
24    revenue of the State of Illinois.
25        (b)  If the Supreme Court of Illinois denies  the  holder
26    or  holders  of bonds leave to file an original action in the
27    Supreme Court, the bond  holder  or  holders  may  bring  the
28    action in the Circuit Court of Sangamon County.

29        Section  30.  Exemption  from  taxation.   As provided in
30    this Act, the issuance of Elder Care Savings Bonds is in  all
31    respects  for  the  benefit  of  the  People  of the State of
32    Illinois, the conduct and increase  of  their  commerce,  the
 
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 1    protection  and enhancement of their welfare, the development
 2    of continued prosperity, and the improvement of their  health
 3    and living conditions, and the issuance of those bonds is for
 4    public purposes.  In consideration of those facts, Elder Care
 5    Savings Bonds issued under the General Obligation Bond Act in
 6    accordance  with  this  Act and the income derived from those
 7    bonds shall be free from all taxation by  the  State  or  its
 8    political  subdivisions,  except  for  estate,  transfer, and
 9    inheritance taxes.

10        Section 35.  Grant program.
11        (a)  The proceedings of the Governor and the Director  of
12    the  Bureau  of  the Budget authorizing the issuance of Elder
13    Care Savings Bonds shall also provide for a grant program  of
14    additional  financial incentives to be provided to holders of
15    those bonds to encourage the use of the bonds and the  income
16    derived  from  the  bonds  for  one  or more of the following
17    purposes:
18             (1)  Care in a facility licensed under  the  Nursing
19        Home Care Act.
20             (2)  Home  health  nursing  services  or home health
21        aide services provided by a home health  agency  licensed
22        under the Home Health Agency Licensing Act.
23             (3)  Respite  care as defined in the Respite Program
24        Act.
25             (4)  Custodial care services.
26             (5)  Care in a hospice licensed  under  the  Hospice
27        Program Licensing Act.
28             (6)  Long  term  health  care services for the aged,
29        the disabled, or persons diagnosed as infected  with  HIV
30        or  having  AIDS  or a related condition.  These services
31        include, without limitation, chore-housekeeping services,
32        a personal care  attendant,  adult  day  care,  assistive
33        equipment,  home  renovation,  home-delivered  meals, and
 
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 1        emergency response systems.  As used in  this  paragraph,
 2        "AIDS"  means  acquired  immunodeficiency syndrome; "HIV"
 3        means the  Human  Immunodeficiency  Virus  or  any  other
 4        identified causative agent of AIDS.
 5             (7)  Care in an assisted living establishment.
 6        (b)  The  grant  program of financial incentives shall be
 7    administered   by   the   State   Treasurer    pursuant    to
 8    administrative rules adopted by the Treasurer.  The financial
 9    incentives  shall  be in forms determined by the Governor and
10    the Director of the Bureau of the Budget at the time  of  the
11    authorization  of  the  Elder  Care  Savings  Bonds  and  may
12    include,  among  others, supplemental payments to the holders
13    of the bonds at maturity to be applied to costs  of  care  or
14    services  specified  in  items  (1) through (6) of subsection
15    (a).  The Treasurer may establish,  by  rule,  administrative
16    procedures  and  eligibility  criteria for the grant program;
17    those rules must be consistent with the purposes of this Act.
18    The Treasurer may require bond  holders,  providers  of  long
19    term  health  care  services,  and other necessary parties to
20    assist in the  determination  of  eligibility  for  financial
21    incentives under the grant program.
22        (c)  All  grants shall be subject to annual appropriation
23    of  moneys  for  that  purpose  by  the   General   Assembly.
24    Financial  incentives  shall be provided only if, in the sole
25    judgment of the Director of the Bureau  of  the  Budget,  the
26    cost  of  the incentives will not cause the cost to the State
27    of the proceeds of the Elder Care Savings Bonds being sold to
28    be increased by more than 0.5%.

29        Section 40. Education program.  The State Treasurer shall
30    develop and implement  an  education  program  and  marketing
31    strategies  designed  to inform residents of this State about
32    the options available for financing long term health care and
33    the need to accumulate the financial resources  necessary  to
 
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 1    pay for that care.  The Treasurer shall report to the General
 2    Assembly  on  the  program developed and its operation before
 3    May 1, 1998.  The Treasurer shall adopt rules with respect to
 4    his or her powers and duties under this Act.

 5        Section 45. Elder Care Trust Authority.
 6        (a)  There is created the  Elder  Care  Trust  Authority.
 7    The Authority shall consist of 11 members, 7 of whom shall be
 8    appointed as follows:  the Speaker and Minority Leader of the
 9    House  of  Representatives  and  the  President  and Minority
10    Leader of the Senate shall each appoint one member,  and  the
11    Governor  shall  appoint 3 members.  The State Treasurer, the
12    Director of the Bureau of the Budget, the Director of  Public
13    Health,  and the Director of the Illinois Economic and Fiscal
14    Commission, or their respective designees, shall  each  be  a
15    member  ex  officio.   The  Governor  and legislative leaders
16    shall give consideration to selecting  members  that  include
17    representatives   from   the   following  categories:  (i)  a
18    director, officer, or employee of  an  entity  that  provides
19    long  term  health  care  services;  (ii)  a  person having a
20    favorable reputation for skill, knowledge, and experience  in
21    the  field  of  state  and  municipal  finance,  either  as a
22    partner, officer, or employee of an investment  banking  firm
23    that  originates and purchases state and municipal securities
24    or as an officer or employee of an insurance company or  bank
25    whose  duties  relate  to the purchase of state and municipal
26    securities as an investment and to the management and control
27    of a state and municipal securities portfolio;  and  (iii)  a
28    person  experienced  in and having a favorable reputation for
29    skill, knowledge, and experience in the long term health care
30    loan finance field.
31        The State Treasurer or  the  Treasurer's  designee  shall
32    serve as the chairperson of the Authority.
33        The  appointed  members  of the Authority first appointed
 
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 1    shall serve for terms expiring on  June  30  in  1999,  2000,
 2    2001, 2002, 2003, 2004, and 2005 respectively, or until their
 3    respective successors have been appointed and have qualified.
 4    The initial term of each of those members shall be determined
 5    by  lot.   Upon the expiration of the term of any member, the
 6    member's successor shall be appointed for a term of  6  years
 7    and  until  his  or  her successor has been appointed and has
 8    qualified.
 9        Any vacancy shall be filled in the manner of the original
10    appointment for the remainder of the unexpired term.
11        Any member  of  the  Authority  may  be  removed  by  the
12    appointing  authority for misfeasance, malfeasance, or wilful
13    neglect of duty or other cause  after  notice  and  a  public
14    hearing,  unless that notice and hearing are expressly waived
15    by the member in writing.
16        Members shall be compensated from moneys appropriated  to
17    the  State  Treasurer  for their reasonable expenses actually
18    incurred in performing their duties.
19        Staff assistance shall be provided to  the  Authority  by
20    the State Treasurer.
21        The Authority shall meet at least once each year.
22        (b)  The Authority has the following responsibilities:
23             (1)  To  make  recommendations  to the Bureau of the
24        Budget regarding the  marketing  of  Elder  Care  Savings
25        Bonds  to  ensure their broad distribution throughout the
26        State for long term health care purposes.
27             (2)  To advise  the  Bureau  of  the  Budget  on  an
28        effective  advertising  campaign  to  inform  the general
29        public  about  Elder  Care  Savings   Bonds   and   their
30        availability.
31             (3)  To  advise the Governor and the Director of the
32        Bureau of the Budget regarding the increments in which to
33        market the bonds, and to recommend  maturity  dates  that
34        will make moneys available to purchasers at the time when
 
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 1        the moneys are needed for long term health care purposes.
 2             (4)  To  advise  the  Bureau of the Budget on limits
 3        that may be imposed on the amount of Elder  Care  Savings
 4        Bonds that may be purchased by individual households.
 5             (5)  To  advise  the  Bureau  of  the  Budget on the
 6        minimum denominations in which to market the  Elder  Care
 7        Savings Bonds so that they are affordable by individuals.
 8             (6)  To  evaluate  the  feasibility  of staggered or
 9        periodic forms of payments for Elder Care Savings  Bonds,
10        and  to  advise  the  Bureau of the Budget regarding that
11        evaluation.
12             (7)  After the initial sale of  Elder  Care  Savings
13        Bonds,  to  assess  the  effectiveness of the program and
14        recommend constructive  changes  to  the  Bureau  of  the
15        Budget regarding future bond sales.
16             (8)  To  study  and  review  alternative  investment
17        instruments  with respect to their suitability for a long
18        term health care savings program.
19             (9)  To make recommendations to the General Assembly
20        regarding statutory  changes  that  the  Authority  deems
21        necessary or desirable.

22        Section  105.  The General Obligation Bond Act is amended
23    by changing Section 2 as follows:

24        (30 ILCS 330/2) (from Ch. 127, par. 652)
25        Sec. 2. Authorization for Bonds.  The State  of  Illinois
26    is  authorized  to issue, sell and provide for the retirement
27    of General Obligation Bonds of the State of Illinois  in  the
28    total amount of $11,195,296,392 $10,895,296,392 herein called
29    "Bonds".
30        Of  the  total  amount  of  bonds authorized above, up to
31    $2,200,000,000 in aggregate original principal amount may  be
32    issued  and sold in accordance with the Baccalaureate Savings
 
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 1    Act in the form of General Obligation College Savings Bonds.
 2        Of the total amount of  bonds  authorized  above,  up  to
 3    $300,000,000  in  aggregate  original principal amount may be
 4    issued and sold in accordance with the Retirement Savings Act
 5    in the form of General Obligation Retirement Savings Bonds.
 6        Of the total amount of  bonds  authorized  above,  up  to
 7    $300,000,000  in  aggregate  original principal amount may be
 8    issued and sold in accordance with  the  Elder  Care  Savings
 9    Bond Act in the form of General Obligation Elder Care Savings
10    Bonds.
11        The  issuance  and  sale of Bonds pursuant to the General
12    Obligation Bond Act is an economical and efficient method  of
13    financing  the  capital  needs  of  the State.  This Act will
14    permit the issuance of  a  multi-purpose  General  Obligation
15    Bond  with  uniform  terms  and features.  This will not only
16    lower the cost of registration but also  reduce  the  overall
17    cost  of  issuing  debt  by  improving  the  marketability of
18    Illinois General Obligation Bonds.
19        Bonds shall be issued for  the  categories  and  specific
20    purposes  expressed in Sections 2 through 8 and Section 16 of
21    this Act.
22    (Source: P.A. 90-1, eff. 2-20-97; 90-8, eff. 12-8-97; 90-549,
23    eff. 12-8-97; 90-586, eff. 6-4-98.)

24        Section 999.  Effective date.  This Act takes effect upon
25    becoming law.

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