State of Illinois
91st General Assembly
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Public Act 91-0052

SB145 Enrolled                                 LRB9100649EGfg

    AN ACT in relation to environmental protection.

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

    Section  5.   The Environmental Protection Act is amended
by  re-enacting  Title  IV-A  and  adding  Section  19.10  as
follows:

    (415 ILCS 5/Title IV-A heading)
             TITLE IV-A: WATER POLLUTION CONTROL
                  AND PUBLIC WATER SUPPLIES

    (415 ILCS 5/19.1) (from Ch. 111 1/2, par. 1019.1)
    Sec. 19.1.  Legislative findings.  The  General  Assembly
finds:
    (a)  that  local  government  units require assistance in
financing the construction of wastewater treatment  works  in
order  to  comply  with  the State's program of environmental
protection and federally mandated requirements;
    (b)  that the federal Water Quality Act of 1987  provides
an  important  source  of  grant  awards  to  the  State  for
providing  assistance  to  local government units through the
Water Pollution Control Loan Program;
    (c)  that local government units  require  assistance  in
financing  the construction of their public water supplies to
comply  with  State  and  federal  drinking  water  laws  and
regulations;
    (d)  that the federal Safe Drinking Water  Act  ("SDWA"),
P.L.  93-532,  as  now  or  hereafter  amended,  provides  an
important  source of capitalization grant awards to the State
to provide assistance to local government units  through  the
Public Water Supply Loan Program; and
    (e)  that  violations of State and federal drinking water
standards threaten the public interest, safety, and  welfare,
which  demands  that  the  Illinois  Environmental Protection
Agency expeditiously adopt emergency rules to administer  the
Public Water Supply Loan Program.
(Source: P.A. 90-121, eff. 7-17-97.)

    (415 ILCS 5/19.2) (from Ch. 111 1/2, par. 1019.2)
    Sec.  19.2.   As  used  in this Title, unless the context
clearly requires otherwise:
    (a)  "Agency" means the Illinois Environmental Protection
Agency.
    (b)  "Fund"  means  the  Water  Revolving  Fund   created
pursuant  to  this  Title,  consisting of the Water Pollution
Control Loan Program, the Public Water Supply  Loan  Program,
and the Loan Support Program.
    (c)  "Loan"  means  a  loan made from the Water Pollution
Control Loan Program or the Public Water Supply Loan  Program
to  an  eligible  local  government  unit  as  a  result of a
contractual agreement between the Agency and such unit.
    (d)  "Construction"  means  any  one  or  more   of   the
following   which   is   undertaken  for  a  public  purpose:
preliminary planning to  determine  the  feasibility  of  the
treatment   works   or   public  water  supply,  engineering,
architectural, legal, fiscal or  economic  investigations  or
studies,   surveys,   designs,   plans,   working   drawings,
specifications,   procedures   or  other  necessary  actions,
erection,  building,  acquisition,  alteration,   remodeling,
improvement  or  extension of treatment works or public water
supplies, or the inspection or  supervision  of  any  of  the
foregoing items.  "Construction" also includes implementation
of source water quality protection measures and establishment
and   implementation   of  wellhead  protection  programs  in
accordance  with  Section  1452(k)(1)  of  the  federal  Safe
Drinking Water Act.
    (e)  "Intended use plan" means a plan  which  includes  a
description  of  the short and long term goals and objectives
of the Water Pollution Control Loan Program  and  the  Public
Water  Supply  Loan  Program,  project  categories, discharge
requirements,  terms  of   financial   assistance   and   the
communities to be served.
    (f)  "Treatment  works"  means  any  devices  and systems
owned by a local government unit and  used  in  the  storage,
treatment,   recycling,   and   reclamation  of  sewerage  or
industrial wastes of a liquid nature, including  intercepting
sewers,  outfall  sewers,  sewage collection systems, pumping
power and other  equipment,  and  appurtenances;  extensions,
improvements, remodeling, additions, and alterations thereof;
elements  essential  to  provide  a reliable recycled supply,
such as standby treatment units and  clear  well  facilities;
and  any  works,  including site acquisition of the land that
will be  an  integral  part  of  the  treatment  process  for
wastewater facilities.
    (g)  "Local    government    unit"    means   a   county,
municipality,  township,  municipal  or  county  sewerage  or
utility authority, sanitary district, public water  district,
improvement  authority  or  any  other  political subdivision
whose primary purpose is to construct, operate  and  maintain
wastewater   treatment  facilities  or  public  water  supply
facilities or both.
(Source: P.A. 89-27, eff. 1-1-96; 90-121, eff. 7-17-97.)

    (415 ILCS 5/19.3) (from Ch. 111 1/2, par. 1019.3)
    Sec. 19.3.  Water Revolving Fund.
    (a)  There is hereby created within the State Treasury  a
Water   Revolving  Fund,  consisting  of  3  interest-bearing
special programs to be known as the Water  Pollution  Control
Loan  Program,  the Public Water Supply Loan Program, and the
Loan Support Program, which shall be used and administered by
the Agency.
    (b)  The Water Pollution Control Loan  Program  shall  be
used  and administered by the Agency to provide assistance to
local government units for the following public purposes:
         (1)  to accept and retain funds from  grant  awards,
    appropriations,  transfers,  and payments of interest and
    principal;
         (2)  to  make  direct  loans  at  or  below   market
    interest  rates  to any eligible local government unit to
    finance the construction of wastewater treatments works;
         (3)  to  make  direct  loans  at  or  below   market
    interest  rates  to any eligible local government unit to
    buy or refinance debt  obligations  for  treatment  works
    incurred after March 7, 1985;
         (4)  to  guarantee  or  purchase insurance for local
    obligations where such action would improve credit market
    access or reduce interest rates;
         (5)  as a source of  revenue  or  security  for  the
    payment  of  principal and interest on revenue or general
    obligation bonds issued by the State, if the proceeds  of
    such bonds will be deposited in the Fund;
         (6)  to finance the reasonable costs incurred by the
    Agency in the administration of the Fund; and
         (7)  to  transfer  funds  to the Public Water Supply
    Loan Program.
    (c)  The  Loan  Support  Program  shall   be   used   and
administered by the Agency for the following purposes:
         (1)  to  accept  and  retain funds from grant awards
    and appropriations;
         (2)  to finance the reasonable costs incurred by the
    Agency in  the  administration  of  the  Fund,  including
    activities  under  Title  III  of this Act, including the
    administration of the State construction grant program;
         (3)  to  transfer  funds  to  the  Water   Pollution
    Control  Loan  Program  and  the Public Water Supply Loan
    Program;
         (4)  to accept and retain  a  portion  of  the  loan
    repayments;
         (5)  to  finance the development of the low interest
    loan program for public water supply projects;
         (6)  to finance the reasonable costs incurred by the
    Agency to provide technical assistance for  public  water
    supplies; and
         (7)  to finance the reasonable costs incurred by the
    Agency  for  public water system supervision programs, to
    administer or provide for  technical  assistance  through
    source   water   protection   programs,  to  develop  and
    implement a capacity development strategy,  to  delineate
    and  assess  source  water  protection  areas, and for an
    operator certification program in accordance with Section
    1452 of the federal Safe Drinking Water Act.
    (d)  The Public Water Supply Loan Program shall  be  used
and administered by the Agency to provide assistance to local
government  units for public water supplies for the following
public purposes:
         (1)  to accept and retain funds from  grant  awards,
    appropriations,  transfers,  and payments of interest and
    principal;
         (2)  to  make  direct  loans  at  or  below   market
    interest  rates  to any eligible local government unit to
    finance the construction of public water supplies;
         (3)  to buy or refinance the debt  obligation  of  a
    local  government unit for costs incurred on or after the
    effective date of this amendatory Act of 1997;
         (4)  to  guarantee  local  obligations  where   such
    action  would  improve  credit  market  access  or reduce
    interest rates;
         (5)  as a source of  revenue  or  security  for  the
    payment  of  principal and interest on revenue or general
    obligation bonds issued by the State, if the proceeds  of
    such bonds will be deposited into the Fund; and
         (6)  to   transfer  funds  to  the  Water  Pollution
    Control Loan Program.
    (e)   The  Agency  is  designated  as  the  administering
agency of the Fund.  The Agency shall submit to the  Regional
Administrator  of  the United States Environmental Protection
Agency an intended use plan which outlines the  proposed  use
of  funds  available to the State.  The Agency shall take all
actions necessary to secure to the State the benefits of  the
federal  Water  Pollution  Control  Act  and the federal Safe
Drinking Water Act, as now or hereafter amended.
(Source: P.A. 89-27, eff. 1-1-96; 90-121, eff. 7-17-97.)

    (415 ILCS 5/19.4) (from Ch. 111 1/2, par. 1019.4)
    Sec.  19.4.  The  Agency  shall  have  the  authority  to
promulgate regulations to set forth procedures  and  criteria
concerning  loan applications, assurance of payment, interest
rates,  loan  support  rates,   impact   on   user   charges,
eligibility  of  proposed  construction,  priority  of needs,
special loan terms for disadvantaged communities, and maximum
limits on annual distributions  of  funds  to  applicants  or
groups  of applicants.  The Agency shall develop and maintain
a priority list of loan applicants as  categorized  by  need.
Priority  in  making  loans  from the Water Pollution Control
Loan Program must first be given to  local  government  units
which need to make capital improvements to achieve compliance
with  National  Pollutant Discharge Elimination System permit
requirements pursuant to the federal  Water  Quality  Act  of
1987  and  this Act. Priority in making loans from the Public
Water Supply Loan  Program  must  first  be  given  to  local
government  units  that  need to make capital improvements to
protect human health and to achieve compliance with the State
and federal primary drinking water standards adopted pursuant
to this Act and the federal Safe Drinking Water Act,  as  now
and hereafter amended.
(Source: P.A. 89-27, eff. 1-1-96; 90-121, eff. 7-17-97.)

    (415 ILCS 5/19.5) (from Ch. 111 1/2, par. 1019.5)
    Sec. 19.5.  Loans; repayment.
    (a)  The  Agency  shall  have the authority to make loans
for a public  purpose  to  local  government  units  for  the
construction  of  treatment  works  and public water supplies
pursuant to the regulations promulgated under Section 19.4.
    (b)  Loans made from the Fund shall provide for:
         (1)  a schedule of disbursement of proceeds;
         (2)  a fixed rate that includes  interest  and  loan
    support  based  upon  priority, but the loan support rate
    shall not exceed one-half of the fixed  rate  established
    for each loan;
         (3)  a schedule of repayment;
         (4)  initiation  of  principal repayments within one
    year after the project is operational; and
         (5)  a confession of judgment upon default.
    (c)  The Agency may amend existing  loans  to  include  a
loan  support  rate  only  if  the  overall  cost to the loan
recipient is not increased.
    (d)  A local government unit shall secure the payment  of
its  obligations  to  the  Fund  by  a  dedicated  source  of
repayment,  including revenues derived from the imposition of
rates, fees and charges.  In the event of a delinquency as to
payments to the Fund, the local government unit shall  revise
its rates, fees and charges to meet its obligations.
(Source: P.A. 89-27, eff. 1-1-96; 90-121, eff. 7-17-97.)

    (415 ILCS 5/19.6) (from Ch. 111 1/2, par. 1019.6)
    Sec. 19.6.  Delinquent loan repayment.
    (a)  In  the event that a timely payment is not made by a
local government unit  according  to  the  loan  schedule  of
repayment,  the local government unit shall notify the Agency
in writing within 15 days after the payment  due  date.   The
notification  shall  include  a  statement of the reasons the
payment was not  timely  tendered,  the  circumstances  under
which  the  late  payments  will  be  satisfied,  and binding
commitments to assure future payments.  After receipt of this
notification,  the  Agency  shall  confirm  in  writing   the
acceptability  of  the plan or take action in accordance with
subsection (b) of this Section.
    (b)  In the event that a local government unit  fails  to
comply  with subsection (a) of this Section, the Agency shall
promptly  issue  a  notice  of  delinquency  to   the   local
government unit which shall require a written response within
30  days.   The  notice of delinquency shall require that the
local government unit revise its rates, fees and  charges  to
meet  its  obligations  pursuant to subsection (d) of Section
19.5 or take other specified actions as may be appropriate to
remedy the delinquency and to assure future payments.
    (c)  In the event that the local government unit fails to
timely or adequately respond to a notice of  delinquency,  or
fails  to  meet  its obligations made pursuant to subsections
(a) and (b) of this Section,  the  Agency  shall  pursue  the
collection  of  the  amounts  past  due, the outstanding loan
balance and the costs thereby incurred,  either  pursuant  to
the  Illinois  State  Collection  Act of 1986 or by any other
reasonable means as may be provided by law.
(Source: P.A. 90-121, eff. 7-17-97.)

    (415 ILCS 5/19.8) (from Ch. 111 1/2, par. 1019.8)
    Sec. 19.8.  Advisory committees; reports.
    (a)  The Director of the Agency shall appoint  committees
to  advise  the  Agency concerning the financial structure of
the   Programs.    The   committees    shall    consist    of
representatives   from   appropriate   State   agencies,  the
financial  community,   engineering   societies   and   other
interested  parties.   The committees shall meet periodically
and members  shall  be  reimbursed  for  their  ordinary  and
necessary  expenses  incurred  in  the  performance  of their
committee duties.
    (b)  The Agency shall report to the General  Assembly  by
June 30, 1998 regarding the feasibility of providing drinking
water  loans  to not-for-profit community water supplies that
serve  units of local government and to investor-owned public
utilities.  The report shall include a detailed discussion of
all relevant factors and  shall  include  participation  from
representatives of the affected entities.
(Source: P.A. 90-121, eff. 7-17-97.)

    (415 ILCS 5/19.9) (from Ch. 111 1/2, par. 1019.9)
    Sec. 19.9.  This Title shall be liberally construed so as
to effect its purpose.
(Source: P.A. 86-820.)

    (415 ILCS 5/19.10 new)
    Sec.   19.10.   Re-enactment  of  Title  IV-A;  findings;
purpose; validation.
    (a)  The General Assembly finds and declares that:
         (1)  Title IV-A (consisting of Sections 19.1 through
    19.9) was first added to the Environmental Protection Act
    by Article III of Public Act 85-1135, effective September
    1, 1988.  In its original form, Title  IV-A  created  the
    Water Pollution Control Revolving Fund and authorized the
    Illinois  Environmental  Protection Agency to establish a
    program for providing  units  of  local  government  with
    low-cost   loans  to  be  used  to  construct  wastewater
    treatment works.  The loans are paid from  the  Revolving
    Fund,  which  consists  primarily  of  a  combination  of
    federal grant money, State matching money, and money that
    has been repaid on past loans.
         (2)  In  1995,  Title IV-A was amended by Public Act
    89-27, effective January 1, 1997, which created the  Loan
    Support Program and made other changes.  The Loan Support
    Program  provides  financing  for  certain administrative
    costs of the Agency.  It specifically includes the  costs
    of  developing  a  loan  program  for public water supply
    projects.
         (3)  Title IV-A was amended by  Public  Act  90-121,
    effective  July  17,  1997, which changed the name of the
    Water Pollution  Control  Revolving  Fund  to  the  Water
    Revolving  Fund  and created the Public Water Supply Loan
    Program.  Under this program, the Agency is authorized to
    make low-interest loans to units of local government  for
    the construction of public water supply facilities.
         (4)  Title  IV-A has also been amended by Public Act
    86-671,  effective  September  1,  1989;   P.A.   86-820,
    effective  September  7, 1989; and P.A. 90-372, effective
    July 1, 1998.
         (5)  Article III, Section 6, of Public  Act  85-1135
    amended the Build Illinois Bond Act.  Among other changes
    to that Act, P.A. 85-1135 authorized the deposit of up to
    $70,000,000  into  the  Water Pollution Control Revolving
    Fund to be used for the Title IV-A loan program.
         (6)  Article III of Public Act  85-1135  also  added
    Section  5.237  to  the  State Finance Act.  This Section
    added the Water Pollution Control Revolving Fund  to  the
    list of special funds in the State Treasury.  The Section
    was  renumbered  as  Section  5.238  by  a revisory bill,
    Public Act 85-1440, effective February 1, 1989.  Although
    the name of the Fund was changed by  Public  Act  90-121,
    that Act did not make the corresponding change in Section
    5.238.
         (7)  Over  the  10  years  that  it has administered
    Title IV-A programs, the Agency  has  entered  into  loan
    agreements with hundreds of units of local government and
    provided  hundreds  of  millions  of dollars of financial
    assistance for water pollution control  projects.   There
    are  currently  many  active  Title  IV-A  loans  in  the
    disbursement  phase and many more that are in the process
    of being repaid.  The Agency continues  to  receive  many
    new applications each year.
         (8)  Public  Act  85-1135, which created Title IV-A,
    also contained provisions  relating  to  tax  reform  and
    State bonds.
         (9)  On  August  26,  1998,  the Cook County Circuit
    Court entered an order in  the  case  of  Oak  Park  Arms
    Associates v. Whitley (No. 92 L 51045), in which it found
    that  Public  Act  85-1135  violates  the  single subject
    clause of the Illinois Constitution (Article IV,  Section
    8(d)).   As  of  the time this amendatory Act of 1999 was
    prepared, the order declaring P.A.  85-1135  invalid  has
    been vacated but the case is subject to appeal.
         (10)  The  projects  funded  under Title IV-A affect
    the vital areas of wastewater  and  sewage  disposal  and
    drinking water supply and are important for the continued
    health, safety, and welfare of the people of this State.
    (b)  It  is the purpose of this amendatory Act of 1999 to
prevent  or  minimize  any   disruption   to   the   programs
administered under Title IV-A that may result from challenges
to the constitutional validity of Public Act 85-1135.
    (c)  This  amendatory Act of 1999 re-enacts Title IV-A of
the Environmental Protection Act  as  it  has  been  amended.
This  re-enactment  is intended to ensure the continuation of
the programs administered under that Title and, if necessary,
to recreate them.  The material in Sections 19.1 through 19.9
is  shown  as  existing  text  (i.e.,  without  underscoring)
because, as of the time  this  amendatory  Act  of  1999  was
prepared,  the  order declaring P.A. 85-1135 invalid has been
vacated.  Section  19.7  has  been  omitted  because  it  was
repealed by Public Act 90-372, effective July 1, 1998.
    Section  4.1  is  added to the Build Illinois Bond Act to
re-authorize the deposit of funds into  the  Water  Pollution
Control Revolving Fund.
    Section 5.238 of the State Finance Act is both re-enacted
and  amended  to  reflect  the  current  name  of  the  Water
Revolving Fund.
    (d)  The  re-enactment of Title IV-A of the Environmental
Protection Act by this amendatory Act of 1999 is intended  to
remove  any  question  as to the validity or content of Title
IV-A; it is not intended to supersede any  other  Public  Act
that  amends  the  text  of  a  Section  as set forth in this
amendatory Act.  This re-enactment is not intended, and shall
not be construed, to imply that Public Act 85-1135 is invalid
or to limit or  impair  any  legal  argument  concerning  (1)
whether  the  Agency  has  express  or  implied  authority to
administer loan programs in the absence of Title IV-A, or (2)
whether the  provisions  of  Title  IV-A  were  substantially
re-enacted by P.A. 89-27 or 90-121.
    (e)  All   otherwise  lawful  actions  taken  before  the
effective  date  of  this  amendatory  Act  of  1999  by  any
employee,  officer,  agency,  or  unit  of  State  or   local
government  or  by  any  other  person  or  entity, acting in
reliance on or pursuant to Title IV-A  of  the  Environmental
Protection  Act,  as  set  forth  in Public Act 85-1135 or as
subsequently amended, are hereby validated.
    (f)  All otherwise lawful obligations arising out of loan
agreements entered into before the  effective  date  of  this
amendatory  Act  of  1999  by  the  State or by any employee,
officer, agency, or unit of State or local government, acting
in reliance on or pursuant to Title IV-A of the Environmental
Protection Act, as set forth in  Public  Act  85-1135  or  as
subsequently amended, are hereby validated and affirmed.
    (g)  All   otherwise   lawful  deposits  into  the  Water
Pollution Control Revolving Fund made  before  the  effective
date  of  this  amendatory  Act  of  1999  in accordance with
Section 4 of the Build Illinois Bond Act,  as  set  forth  in
Public Act 85-1135 or as subsequently amended, and the use of
those  deposits  for  the  purposes  of  Title  IV-A  of  the
Environmental Protection Act, are hereby validated.
    (h)  This   amendatory   Act  of  1999  applies,  without
limitation, to actions pending on or after the effective date
of this amendatory Act.

    Section  10.   The  State  Finance  Act  is  amended   by
re-enacting and changing Section 5.238 as follows:

    (30 ILCS 105/5.238) (from Ch. 127, par. 141.238)
    Sec. 5.238.  The Water Pollution Control Revolving Fund.
(Source: P.A. 85-1440.)

    Section  15.   The  Build Illinois Bond Act is amended by
adding Section 4.1 as follows:

    (30 ILCS 425/4.1 new)
    Sec. 4.1. Re-authorization of  deposits  into  the  Water
Pollution  Control  Revolving  Fund.   The making of deposits
into the Water Pollution Control Revolving Fund (now known as
the Water Revolving Fund) to provide assistance in accordance
with the  provisions  of  Title  IV-A  of  the  Environmental
Protection   Act,  in  an  aggregate  amount  not  to  exceed
$70,000,000, which was originally authorized in Section 4  of
this Act by Public Act 85-1135, is hereby re-authorized.
    Section  99.  Effective date.  This Act takes effect upon
becoming law.

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