SB0016sam003 98TH GENERAL ASSEMBLY

Sen. Andy Manar

Filed: 5/13/2014

09800SB0016sam003 LRB098 04277 NHT 59435 a

AMENDMENT TO SENATE BILL 16

AMENDMENT NO. ______. Amend Senate Bill 16 by replacing everything after the enacting clause with the following:

"Section 1. This Act may be referred to as the School Funding Reform Act of 2014.

Section 905. The Economic Development Area Tax Increment Allocation Act is amended by changing Section 7 as follows:

(20 ILCS 620/7) (from Ch. 67 1/2, par. 1007)

Sec. 7. Creation of special tax allocation fund. If a municipality has adopted tax increment allocation financing for an economic development project area by ordinance, the county clerk has thereafter certified the "total initial equalized assessed value" of the taxable real property within such economic development project area in the manner provided in Section 6 of this Act, and the Department has approved and certified the economic development project area, each year after the date of the certification by the county clerk of the "total initial equalized assessed value" until economic development project costs and all municipal obligations financing economic development project costs have been paid, the ad valorem taxes, if any, arising from the levies upon the taxable real property in the economic development project area by taxing districts and tax rates determined in the manner provided in subsection (b) of Section 6 of this Act shall be divided as follows:

(1) That portion of the taxes levied upon each taxable lot, block, tract or parcel of real property which is attributable to the lower of the current equalized assessed value or the initial equalized assessed value of each such taxable lot, block, tract, or parcel of real property existing at the time tax increment allocation financing was adopted, shall be allocated to and when collected shall be paid by the county collector to the respective affected taxing districts in the manner required by law in the absence of the adoption of tax increment allocation financing.

(2) That portion, if any, of those taxes which is attributable to the increase in the current equalized assessed valuation of each taxable lot, block, tract, or parcel of real property in the economic development project area, over and above the initial equalized assessed value of each property existing at the time tax increment allocation financing was adopted, shall be allocated to and when collected shall be paid to the municipal treasurer, who shall deposit those taxes into a special fund called the special tax allocation fund of the municipality for the purpose of paying economic development project costs and obligations incurred in the payment thereof.

The municipality, by an ordinance adopting tax increment allocation financing, may pledge the funds in and to be deposited in the special tax allocation fund for the payment of obligations issued under this Act and for the payment of economic development project costs. No part of the current equalized assessed valuation of each property in the economic development project area attributable to any increase above the total initial equalized assessed value, of such properties shall be used in calculating the general State school aid formula, provided for in Section 18-8 of the School Code, or the primary State aid formula, provided for in Section 18-8.15 of the School Code, until such time as all economic development projects costs have been paid as provided for in this Section.

When the economic development project costs, including without limitation all municipal obligations financing economic development project costs incurred under this Act, have been paid, all surplus funds then remaining in the special tax allocation fund shall be distributed by being paid by the municipal treasurer to the county collector, who shall immediately thereafter pay those funds to the taxing districts having taxable property in the economic development project area in the same manner and proportion as the most recent distribution by the county collector to those taxing districts of real property taxes from real property in the economic development project area.

Upon the payment of all economic development project costs, retirement of obligations and the distribution of any excess monies pursuant to this Section the municipality shall adopt an ordinance dissolving the special tax allocation fund for the economic development project area, terminating the economic development project area, and terminating the use of tax increment allocation financing for the economic development project area. Thereafter the rates of the taxing districts shall be extended and taxes levied, collected and distributed in the manner applicable in the absence of the adoption of tax increment allocation financing.

Nothing in this Section shall be construed as relieving property in economic development project areas from being assessed as provided in the Property Tax Code, or as relieving owners of that property from paying a uniform rate of taxes, as required by Section 4 of Article IX of the Illinois Constitution.

(Source: P.A. 98-463, eff. 8-16-13.)

Section 910. The State Finance Act is amended by changing Section 13.2 as follows:

(30 ILCS 105/13.2) (from Ch. 127, par. 149.2)

Sec. 13.2. Transfers among line item appropriations.

(a) Transfers among line item appropriations from the same treasury fund for the objects specified in this Section may be made in the manner provided in this Section when the balance remaining in one or more such line item appropriations is insufficient for the purpose for which the appropriation was made.

(a-1) No transfers may be made from one agency to another agency, nor may transfers be made from one institution of higher education to another institution of higher education except as provided by subsection (a-4).

(a-2) Except as otherwise provided in this Section, transfers may be made only among the objects of expenditure enumerated in this Section, except that no funds may be transferred from any appropriation for personal services, from any appropriation for State contributions to the State Employees' Retirement System, from any separate appropriation for employee retirement contributions paid by the employer, nor from any appropriation for State contribution for employee group insurance. During State fiscal year 2005, an agency may transfer amounts among its appropriations within the same treasury fund for personal services, employee retirement contributions paid by employer, and State Contributions to retirement systems; notwithstanding and in addition to the transfers authorized in subsection (c) of this Section, the fiscal year 2005 transfers authorized in this sentence may be made in an amount not to exceed 2% of the aggregate amount appropriated to an agency within the same treasury fund. During State fiscal year 2007, the Departments of Children and Family Services, Corrections, Human Services, and Juvenile Justice may transfer amounts among their respective appropriations within the same treasury fund for personal services, employee retirement contributions paid by employer, and State contributions to retirement systems. During State fiscal year 2010, the Department of Transportation may transfer amounts among their respective appropriations within the same treasury fund for personal services, employee retirement contributions paid by employer, and State contributions to retirement systems. During State fiscal years 2010 and 2014 only, an agency may transfer amounts among its respective appropriations within the same treasury fund for personal services, employee retirement contributions paid by employer, and State contributions to retirement systems. Notwithstanding, and in addition to, the transfers authorized in subsection (c) of this Section, these transfers may be made in an amount not to exceed 2% of the aggregate amount appropriated to an agency within the same treasury fund.

(a-3) Further, if an agency receives a separate appropriation for employee retirement contributions paid by the employer, any transfer by that agency into an appropriation for personal services must be accompanied by a corresponding transfer into the appropriation for employee retirement contributions paid by the employer, in an amount sufficient to meet the employer share of the employee contributions required to be remitted to the retirement system.

(a-4) Long-Term Care Rebalancing. The Governor may designate amounts set aside for institutional services appropriated from the General Revenue Fund or any other State fund that receives monies for long-term care services to be transferred to all State agencies responsible for the administration of community-based long-term care programs, including, but not limited to, community-based long-term care programs administered by the Department of Healthcare and Family Services, the Department of Human Services, and the Department on Aging, provided that the Director of Healthcare and Family Services first certifies that the amounts being transferred are necessary for the purpose of assisting persons in or at risk of being in institutional care to transition to community-based settings, including the financial data needed to prove the need for the transfer of funds. The total amounts transferred shall not exceed 4% in total of the amounts appropriated from the General Revenue Fund or any other State fund that receives monies for long-term care services for each fiscal year. A notice of the fund transfer must be made to the General Assembly and posted at a minimum on the Department of Healthcare and Family Services website, the Governor's Office of Management and Budget website, and any other website the Governor sees fit. These postings shall serve as notice to the General Assembly of the amounts to be transferred. Notice shall be given at least 30 days prior to transfer.

(b) In addition to the general transfer authority provided under subsection (c), the following agencies have the specific transfer authority granted in this subsection:

The Department of Healthcare and Family Services is authorized to make transfers representing savings attributable to not increasing grants due to the births of additional children from line items for payments of cash grants to line items for payments for employment and social services for the purposes outlined in subsection (f) of Section 4-2 of the Illinois Public Aid Code.

The Department of Children and Family Services is authorized to make transfers not exceeding 2% of the aggregate amount appropriated to it within the same treasury fund for the following line items among these same line items: Foster Home and Specialized Foster Care and Prevention, Institutions and Group Homes and Prevention, and Purchase of Adoption and Guardianship Services.

The Department on Aging is authorized to make transfers not exceeding 2% of the aggregate amount appropriated to it within the same treasury fund for the following Community Care Program line items among these same line items: purchase of services covered by the Community Care Program and Comprehensive Case Coordination.

The State Treasurer is authorized to make transfers among line item appropriations from the Capital Litigation Trust Fund, with respect to costs incurred in fiscal years 2002 and 2003 only, when the balance remaining in one or more such line item appropriations is insufficient for the purpose for which the appropriation was made, provided that no such transfer may be made unless the amount transferred is no longer required for the purpose for which that appropriation was made.

The State Board of Education is authorized to make transfers from line item appropriations within the same treasury fund for General State Aid, and General State Aid - Hold Harmless, Primary State Aid, and Hold Harmless State Funding, provided that no such transfer may be made unless the amount transferred is no longer required for the purpose for which that appropriation was made, to the line item appropriation for Transitional Assistance when the balance remaining in such line item appropriation is insufficient for the purpose for which the appropriation was made.

The State Board of Education is authorized to make transfers between the following line item appropriations within the same treasury fund: Disabled Student Services/Materials (Section 14-13.01 of the School Code), Disabled Student Transportation Reimbursement (Section 14-13.01 of the School Code), Disabled Student Tuition - Private Tuition (Section 14-7.02 of the School Code), Extraordinary Special Education (Section 14-7.02b of the School Code), Reimbursement for Free Lunch/Breakfast Program, Summer School Payments (Section 18-4.3 of the School Code), and Transportation - Regular/Vocational Reimbursement (Section 29-5 of the School Code). Such transfers shall be made only when the balance remaining in one or more such line item appropriations is insufficient for the purpose for which the appropriation was made and provided that no such transfer may be made unless the amount transferred is no longer required for the purpose for which that appropriation was made.

The Department of Healthcare and Family Services is authorized to make transfers not exceeding 4% of the aggregate amount appropriated to it, within the same treasury fund, among the various line items appropriated for Medical Assistance.

(c) The sum of such transfers for an agency in a fiscal year shall not exceed 2% of the aggregate amount appropriated to it within the same treasury fund for the following objects: Personal Services; Extra Help; Student and Inmate Compensation; State Contributions to Retirement Systems; State Contributions to Social Security; State Contribution for Employee Group Insurance; Contractual Services; Travel; Commodities; Printing; Equipment; Electronic Data Processing; Operation of Automotive Equipment; Telecommunications Services; Travel and Allowance for Committed, Paroled and Discharged Prisoners; Library Books; Federal Matching Grants for Student Loans; Refunds; Workers' Compensation, Occupational Disease, and Tort Claims; and, in appropriations to institutions of higher education, Awards and Grants. Notwithstanding the above, any amounts appropriated for payment of workers' compensation claims to an agency to which the authority to evaluate, administer and pay such claims has been delegated by the Department of Central Management Services may be transferred to any other expenditure object where such amounts exceed the amount necessary for the payment of such claims.

(c-1) Special provisions for State fiscal year 2003. Notwithstanding any other provision of this Section to the contrary, for State fiscal year 2003 only, transfers among line item appropriations to an agency from the same treasury fund may be made provided that the sum of such transfers for an agency in State fiscal year 2003 shall not exceed 3% of the aggregate amount appropriated to that State agency for State fiscal year 2003 for the following objects: personal services, except that no transfer may be approved which reduces the aggregate appropriations for personal services within an agency; extra help; student and inmate compensation; State contributions to retirement systems; State contributions to social security; State contributions for employee group insurance; contractual services; travel; commodities; printing; equipment; electronic data processing; operation of automotive equipment; telecommunications services; travel and allowance for committed, paroled, and discharged prisoners; library books; federal matching grants for student loans; refunds; workers' compensation, occupational disease, and tort claims; and, in appropriations to institutions of higher education, awards and grants.

(c-2) Special provisions for State fiscal year 2005. Notwithstanding subsections (a), (a-2), and (c), for State fiscal year 2005 only, transfers may be made among any line item appropriations from the same or any other treasury fund for any objects or purposes, without limitation, when the balance remaining in one or more such line item appropriations is insufficient for the purpose for which the appropriation was made, provided that the sum of those transfers by a State agency shall not exceed 4% of the aggregate amount appropriated to that State agency for fiscal year 2005.

(d) Transfers among appropriations made to agencies of the Legislative and Judicial departments and to the constitutionally elected officers in the Executive branch require the approval of the officer authorized in Section 10 of this Act to approve and certify vouchers. Transfers among appropriations made to the University of Illinois, Southern Illinois University, Chicago State University, Eastern Illinois University, Governors State University, Illinois State University, Northeastern Illinois University, Northern Illinois University, Western Illinois University, the Illinois Mathematics and Science Academy and the Board of Higher Education require the approval of the Board of Higher Education and the Governor. Transfers among appropriations to all other agencies require the approval of the Governor.

The officer responsible for approval shall certify that the transfer is necessary to carry out the programs and purposes for which the appropriations were made by the General Assembly and shall transmit to the State Comptroller a certified copy of the approval which shall set forth the specific amounts transferred so that the Comptroller may change his records accordingly. The Comptroller shall furnish the Governor with information copies of all transfers approved for agencies of the Legislative and Judicial departments and transfers approved by the constitutionally elected officials of the Executive branch other than the Governor, showing the amounts transferred and indicating the dates such changes were entered on the Comptroller's records.

(e) The State Board of Education, in consultation with the State Comptroller, may transfer line item appropriations for General State Aid or Primary State Aid between the Common School Fund and the Education Assistance Fund. With the advice and consent of the Governor's Office of Management and Budget, the State Board of Education, in consultation with the State Comptroller, may transfer line item appropriations between the General Revenue Fund and the Education Assistance Fund for the following programs:

(1) Disabled Student Personnel Reimbursement (Section 14-13.01 of the School Code);

(2) Disabled Student Transportation Reimbursement (subsection (b) of Section 14-13.01 of the School Code);

(3) Disabled Student Tuition - Private Tuition (Section 14-7.02 of the School Code);

(4) Extraordinary Special Education (Section 14-7.02b of the School Code);

(5) Reimbursement for Free Lunch/Breakfast Programs;

(6) Summer School Payments (Section 18-4.3 of the School Code);

(7) Transportation - Regular/Vocational Reimbursement (Section 29-5 of the School Code);

(8) Regular Education Reimbursement (Section 18-3 of the School Code); and

(9) Special Education Reimbursement (Section 14-7.03 of the School Code).

(Source: P.A. 97-689, eff. 7-1-12; 98-24, eff. 6-19-13.)

Section 915. The Property Tax Code is amended by changing Sections 18-200 and 18-249 as follows:

(35 ILCS 200/18-200)

Sec. 18-200. School Code. A school district's State aid shall not be reduced under the computation under subsections 5(a) through 5(h) of Part A of Section 18-8 of the School Code or under subsection (e) of Section 18-8.15 of the School Code due to the operating tax rate falling from above the minimum requirement of that Section of the School Code to below the minimum requirement of that Section of the School Code due to the operation of this Law.

(Source: P.A. 87-17; 88-455.)

(35 ILCS 200/18-249)

Sec. 18-249. Miscellaneous provisions.

(a) Certification of new property. For the 1994 levy year, the chief county assessment officer shall certify to the county clerk, after all changes by the board of review or board of appeals, as the case may be, the assessed value of new property by taxing district for the 1994 levy year under rules promulgated by the Department.

(b) School Code. A school district's State aid shall not be reduced under the computation under subsections 5(a) through 5(h) of Part A of Section 18-8 of the School Code or under subsection (e) of Section 18-8.15 of the School Code due to the operating tax rate falling from above the minimum requirement of that Section of the School Code to below the minimum requirement of that Section of the School Code due to the operation of this Law.

(c) Rules. The Department shall make and promulgate reasonable rules relating to the administration of the purposes and provisions of Sections 18-246 through 18-249 as may be necessary or appropriate.

(Source: P.A. 89-1, eff. 2-12-95.)

Section 920. The Innovation Development and Economy Act is amended by changing Section 33 as follows:

(50 ILCS 470/33)

Sec. 33. STAR Bonds School Improvement and Operations Trust Fund.

(a) The STAR Bonds School Improvement and Operations Trust Fund is created as a trust fund in the State treasury. Deposits into the Trust Fund shall be made as provided under this Section. Moneys in the Trust Fund shall be used by the Department of Revenue only for the purpose of making payments to school districts in educational service regions that include or are adjacent to the STAR bond district. Moneys in the Trust Fund are not subject to appropriation and shall be used solely as provided in this Section. All deposits into the Trust Fund shall be held in the Trust Fund by the State Treasurer as ex officio custodian separate and apart from all public moneys or funds of this State and shall be administered by the Department exclusively for the purposes set forth in this Section. All moneys in the Trust Fund shall be invested and reinvested by the State Treasurer. All interest accruing from these investments shall be deposited in the Trust Fund.

(b) Upon approval of a STAR bond district, the political subdivision shall immediately transmit to the county clerk of the county in which the district is located a certified copy of the ordinance creating the district, a legal description of the district, a map of the district, identification of the year that the county clerk shall use for determining the total initial equalized assessed value of the district consistent with subsection (c), and a list of the parcel or tax identification number of each parcel of property included in the district.

(c) Upon approval of a STAR bond district, the county clerk immediately thereafter shall determine (i) the most recently ascertained equalized assessed value of each lot, block, tract, or parcel of real property within the STAR bond district, from which shall be deducted the homestead exemptions under Article 15 of the Property Tax Code, which value shall be the initial equalized assessed value of each such piece of property, and (ii) the total equalized assessed value of all taxable real property within the district by adding together the most recently ascertained equalized assessed value of each taxable lot, block, tract, or parcel of real property within the district, from which shall be deducted the homestead exemptions under Article 15 of the Property Tax Code, and shall certify that amount as the total initial equalized assessed value of the taxable real property within the STAR bond district.

(d) In reference to any STAR bond district created within any political subdivision, and in respect to which the county clerk has certified the total initial equalized assessed value of the property in the area, the political subdivision may thereafter request the clerk in writing to adjust the initial equalized value of all taxable real property within the STAR bond district by deducting therefrom the exemptions under Article 15 of the Property Tax Code applicable to each lot, block, tract, or parcel of real property within the STAR bond district. The county clerk shall immediately, after the written request to adjust the total initial equalized value is received, determine the total homestead exemptions in the STAR bond district as provided under Article 15 of the Property Tax Code by adding together the homestead exemptions provided by said Article on each lot, block, tract, or parcel of real property within the STAR bond district and then shall deduct the total of said exemptions from the total initial equalized assessed value. The county clerk shall then promptly certify that amount as the total initial equalized assessed value as adjusted of the taxable real property within the STAR bond district.

(e) The county clerk or other person authorized by law shall compute the tax rates for each taxing district with all or a portion of its equalized assessed value located in the STAR bond district. The rate per cent of tax determined shall be extended to the current equalized assessed value of all property in the district in the same manner as the rate per cent of tax is extended to all other taxable property in the taxing district.

(f) Beginning with the assessment year in which the first destination user in the first STAR bond project in a STAR bond district makes its first retail sales and for each assessment year thereafter until final maturity of the last STAR bonds issued in the district, the county clerk or other person authorized by law shall determine the increase in equalized assessed value of all real property within the STAR bond district by subtracting the initial equalized assessed value of all property in the district certified under subsection (c) from the current equalized assessed value of all property in the district. Each year, the property taxes arising from the increase in equalized assessed value in the STAR bond district shall be determined for each taxing district and shall be certified to the county collector.

(g) Beginning with the year in which taxes are collected based on the assessment year in which the first destination user in the first STAR bond project in a STAR bond district makes its first retail sales and for each year thereafter until final maturity of the last STAR bonds issued in the district, the county collector shall, within 30 days after receipt of property taxes, transmit to the Department to be deposited into the STAR Bonds School Improvement and Operations Trust Fund 15% of property taxes attributable to the increase in equalized assessed value within the STAR bond district from each taxing district as certified in subsection (f).

(h) The Department shall pay to the regional superintendent of schools whose educational service region includes Franklin and Williamson Counties, for each year for which money is remitted to the Department and paid into the STAR Bonds School Improvement and Operations Trust Fund, the money in the Fund as provided in this Section. The amount paid to each school district shall be allocated proportionately, based on each qualifying school district's fall enrollment for the then-current school year, such that the school district with the largest fall enrollment receives the largest proportionate share of money paid out of the Fund or by any other method or formula that the regional superintendent of schools deems fit, equitable, and in the public interest. The regional superintendent may allocate moneys to school districts that are outside of his or her educational service region or to other regional superintendents.

The Department shall determine the distributions under this Section using its best judgment and information. The Department shall be held harmless for the distributions made under this Section and all distributions shall be final.

(i) In any year that an assessment appeal is filed, the extension of taxes on any assessment so appealed shall not be delayed. In the case of an assessment that is altered, any taxes extended upon the unauthorized assessment or part thereof shall be abated, or, if already paid, shall be refunded with interest as provided in Section 23-20 of the Property Tax Code. In the case of an assessment appeal, the county collector shall notify the Department that an assessment appeal has been filed and the amount of the tax that would have been deposited in the STAR Bonds School Improvement and Operations Trust Fund. The county collector shall hold that amount in a separate fund until the appeal process is final. After the appeal process is finalized, the county collector shall transmit to the Department the amount of tax that remains, if any, after all required refunds are made. The Department shall pay any amount deposited into the Trust Fund under this Section in the same proportion as determined for payments for that taxable year under subsection (h).

(j) In any year that ad valorem taxes are allocated to the STAR Bonds School Improvement and Operations Trust Fund, that allocation shall not reduce or otherwise impact the school aid provided to any school district under the general State school aid formula provided for in Section 18-8.05 of the School Code or the primary State aid formula provided for in Section 18-8.15 of the School Code.

(Source: P.A. 96-939, eff. 6-24-10.)

Section 925. The County Economic Development Project Area Property Tax Allocation Act is amended by changing Section 7 as follows:

(55 ILCS 85/7) (from Ch. 34, par. 7007)

Sec. 7. Creation of special tax allocation fund. If a county has adopted property tax allocation financing by ordinance for an economic development project area, the Department has approved and certified the economic development project area, and the county clerk has thereafter certified the "total initial equalized value" of the taxable real property within such economic development project area in the manner provided in subsection (b) of Section 6 of this Act, each year after the date of the certification by the county clerk of the "initial equalized assessed value" until economic development project costs and all county obligations financing economic development project costs have been paid, the ad valorem taxes, if any, arising from the levies upon the taxable real property in the economic development project area by taxing districts and tax rates determined in the manner provided in subsection (b) of Section 6 of this Act shall be divided as follows:

(1) That portion of the taxes levied upon each taxable lot, block, tract or parcel of real property which is attributable to the lower of the current equalized assessed value or the initial equalized assessed value of each such taxable lot, block, tract, or parcel of real property existing at the time property tax allocation financing was adopted shall be allocated and when collected shall be paid by the county collector to the respective affected taxing districts in the manner required by the law in the absence of the adoption of property tax allocation financing.

(2) That portion, if any, of those taxes which is attributable to the increase in the current equalized assessed valuation of each taxable lot, block, tract, or parcel of real property in the economic development project are, over and above the initial equalized assessed value of each property existing at the time property tax allocation financing was adopted shall be allocated to and when collected shall be paid to the county treasurer, who shall deposit those taxes into a special fund called the special tax allocation fund of the county for the purpose of paying economic development project costs and obligations incurred in the payment thereof.

The county, by an ordinance adopting property tax allocation financing, may pledge the funds in and to be deposited in the special tax allocation fund for the payment of obligations issued under this Act and for the payment of economic development project costs. No part of the current equalized assessed valuation of each property in the economic development project area attributable to any increase above the total initial equalized assessed value of such properties shall be used in calculating the general State school aid formula, provided for in Section 18-8 of the School Code, or the primary State aid formula, provided for in Section 18-8.15 of the School Code, until such time as all economic development projects costs have been paid as provided for in this Section.

Whenever a county issues bonds for the purpose of financing economic development project costs, the county may provide by ordinance for the appointment of a trustee, which may be any trust company within the State, and for the establishment of the funds or accounts to be maintained by such trustee as the county shall deem necessary to provide for the security and payment of the bonds. If the county provides for the appointment of a trustee, the trustee shall be considered the assignee of any payments assigned by the county pursuant to the ordinance and this Section. Any amounts paid to the trustee as assignee shall be deposited in the funds or accounts established pursuant to the trust agreement, and shall be held by the trustee in trust for the benefit of the holders of the bonds, and the holders shall have a lien on and a security interest in those bonds or accounts so long as the bonds remain outstanding and unpaid. Upon retirement of the bonds, the trustee shall pay over any excess amounts held to the county for deposit in the special tax allocation fund.

When the economic development project costs, including without limitation all county obligations financing economic development project costs incurred under this Act, have been paid, all surplus funds then remaining in the special tax allocation funds shall be distributed by being paid by the county treasurer to the county collector, who shall immediately thereafter pay those funds to the taxing districts having taxable property in the economic development project area in the same manner and proportion as the most recent distribution by the county collector to those taxing districts of real property taxes from real property in the economic development project area.

Upon the payment of all economic development project costs, retirement of obligations and the distribution of any excess monies pursuant to this Section and not later than 23 years from the date of adoption of the ordinance adopting property tax allocation financing, the county shall adopt an ordinance dissolving the special tax allocation fund for the economic development project area and terminating the designation of the economic development project area as an economic development project area. Thereafter the rates of the taxing districts shall be extended and taxes levied, collected and distributed in the manner applicable in the absence of the adoption of property tax allocation financing.

Nothing in this Section shall be construed as relieving property in economic development project areas from being assessed as provided in the Property Tax Code or as relieving owners of that property from paying a uniform rate of taxes, as required by Section 4 of Article IX of the Illinois Constitution of 1970.

(Source: P.A. 98-463, eff. 8-16-13.)

Section 930. The County Economic Development Project Area Tax Increment Allocation Act of 1991 is amended by changing Section 50 as follows:

(55 ILCS 90/50) (from Ch. 34, par. 8050)

Sec. 50. Special tax allocation fund.

(a) If a county clerk has certified the "total initial equalized assessed value" of the taxable real property within an economic development project area in the manner provided in Section 45, each year after the date of the certification by the county clerk of the "total initial equalized assessed value", until economic development project costs and all county obligations financing economic development project costs have been paid, the ad valorem taxes, if any, arising from the levies upon the taxable real property in the economic development project area by taxing districts and tax rates determined in the manner provided in subsection (b) of Section 45 shall be divided as follows:

(1) That portion of the taxes levied upon each taxable lot, block, tract, or parcel of real property that is attributable to the lower of the current equalized assessed value or the initial equalized assessed value of each taxable lot, block, tract, or parcel of real property existing at the time tax increment financing was adopted shall be allocated to (and when collected shall be paid by the county collector to) the respective affected taxing districts in the manner required by law in the absence of the adoption of tax increment allocation financing.

(2) That portion, if any, of the taxes that is attributable to the increase in the current equalized assessed valuation of each taxable lot, block, tract, or parcel of real property in the economic development project area, over and above the initial equalized assessed value of each property existing at the time tax increment financing was adopted, shall be allocated to (and when collected shall be paid to) the county treasurer, who shall deposit the taxes into a special fund (called the special tax allocation fund of the county) for the purpose of paying economic development project costs and obligations incurred in the payment of those costs.

(b) The county, by an ordinance adopting tax increment allocation financing, may pledge the monies in and to be deposited into the special tax allocation fund for the payment of obligations issued under this Act and for the payment of economic development project costs. No part of the current equalized assessed valuation of each property in the economic development project area attributable to any increase above the total initial equalized assessed value of those properties shall be used in calculating the general State school aid formula under Section 18-8 of the School Code or the primary State aid formula under Section 18-8.15 of the School Code until all economic development projects costs have been paid as provided for in this Section.

(c) When the economic development projects costs, including without limitation all county obligations financing economic development project costs incurred under this Act, have been paid, all surplus monies then remaining in the special tax allocation fund shall be distributed by being paid by the county treasurer to the county collector, who shall immediately pay the monies to the taxing districts having taxable property in the economic development project area in the same manner and proportion as the most recent distribution by the county collector to those taxing districts of real property taxes from real property in the economic development project area.

(d) Upon the payment of all economic development project costs, retirement of obligations, and distribution of any excess monies under this Section, the county shall adopt an ordinance dissolving the special tax allocation fund for the economic development project area and terminating the designation of the economic development project area as an economic development project area. Thereafter, the rates of the taxing districts shall be extended and taxes shall be levied, collected, and distributed in the manner applicable in the absence of the adoption of tax increment allocation financing.

(e) Nothing in this Section shall be construed as relieving property in the economic development project areas from being assessed as provided in the Property Tax Code or as relieving owners of that property from paying a uniform rate of taxes as required by Section 4 of Article IX of the Illinois Constitution.

(Source: P.A. 98-463, eff. 8-16-13.)

Section 935. The Illinois Municipal Code is amended by changing Sections 11-74.4-3, 11-74.4-8, and 11-74.6-35 as follows:

(65 ILCS 5/11-74.4-3) (from Ch. 24, par. 11-74.4-3)

Sec. 11-74.4-3. Definitions. The following terms, wherever used or referred to in this Division 74.4 shall have the following respective meanings, unless in any case a different meaning clearly appears from the context.

(a) For any redevelopment project area that has been designated pursuant to this Section by an ordinance adopted prior to November 1, 1999 (the effective date of Public Act 91-478), "blighted area" shall have the meaning set forth in this Section prior to that date.

On and after November 1, 1999, "blighted area" means any improved or vacant area within the boundaries of a redevelopment project area located within the territorial limits of the municipality where:

(1) If improved, industrial, commercial, and residential buildings or improvements are detrimental to the public safety, health, or welfare because of a combination of 5 or more of the following factors, each of which is (i) present, with that presence documented, to a meaningful extent so that a municipality may reasonably find that the factor is clearly present within the intent of the Act and (ii) reasonably distributed throughout the improved part of the redevelopment project area:

(A) Dilapidation. An advanced state of disrepair or neglect of necessary repairs to the primary structural components of buildings or improvements in such a combination that a documented building condition analysis determines that major repair is required or the defects are so serious and so extensive that the buildings must be removed.

(B) Obsolescence. The condition or process of falling into disuse. Structures have become ill-suited for the original use.

(C) Deterioration. With respect to buildings, defects including, but not limited to, major defects in the secondary building components such as doors, windows, porches, gutters and downspouts, and fascia. With respect to surface improvements, that the condition of roadways, alleys, curbs, gutters, sidewalks, off-street parking, and surface storage areas evidence deterioration, including, but not limited to, surface cracking, crumbling, potholes, depressions, loose paving material, and weeds protruding through paved surfaces.

(D) Presence of structures below minimum code standards. All structures that do not meet the standards of zoning, subdivision, building, fire, and other governmental codes applicable to property, but not including housing and property maintenance codes.

(E) Illegal use of individual structures. The use of structures in violation of applicable federal, State, or local laws, exclusive of those applicable to the presence of structures below minimum code standards.

(F) Excessive vacancies. The presence of buildings that are unoccupied or under-utilized and that represent an adverse influence on the area because of the frequency, extent, or duration of the vacancies.

(G) Lack of ventilation, light, or sanitary facilities. The absence of adequate ventilation for light or air circulation in spaces or rooms without windows, or that require the removal of dust, odor, gas, smoke, or other noxious airborne materials. Inadequate natural light and ventilation means the absence of skylights or windows for interior spaces or rooms and improper window sizes and amounts by room area to window area ratios. Inadequate sanitary facilities refers to the absence or inadequacy of garbage storage and enclosure, bathroom facilities, hot water and kitchens, and structural inadequacies preventing ingress and egress to and from all rooms and units within a building.

(H) Inadequate utilities. Underground and overhead utilities such as storm sewers and storm drainage, sanitary sewers, water lines, and gas, telephone, and electrical services that are shown to be inadequate. Inadequate utilities are those that are: (i) of insufficient capacity to serve the uses in the redevelopment project area, (ii) deteriorated, antiquated, obsolete, or in disrepair, or (iii) lacking within the redevelopment project area.

(I) Excessive land coverage and overcrowding of structures and community facilities. The over-intensive use of property and the crowding of buildings and accessory facilities onto a site. Examples of problem conditions warranting the designation of an area as one exhibiting excessive land coverage are: (i) the presence of buildings either improperly situated on parcels or located on parcels of inadequate size and shape in relation to present-day standards of development for health and safety and (ii) the presence of multiple buildings on a single parcel. For there to be a finding of excessive land coverage, these parcels must exhibit one or more of the following conditions: insufficient provision for light and air within or around buildings, increased threat of spread of fire due to the close proximity of buildings, lack of adequate or proper access to a public right-of-way, lack of reasonably required off-street parking, or inadequate provision for loading and service.

(J) Deleterious land use or layout. The existence of incompatible land-use relationships, buildings occupied by inappropriate mixed-uses, or uses considered to be noxious, offensive, or unsuitable for the surrounding area.

(K) Environmental clean-up. The proposed redevelopment project area has incurred Illinois Environmental Protection Agency or United States Environmental Protection Agency remediation costs for, or a study conducted by an independent consultant recognized as having expertise in environmental remediation has determined a need for, the clean-up of hazardous waste, hazardous substances, or underground storage tanks required by State or federal law, provided that the remediation costs constitute a material impediment to the development or redevelopment of the redevelopment project area.

(L) Lack of community planning. The proposed redevelopment project area was developed prior to or without the benefit or guidance of a community plan. This means that the development occurred prior to the adoption by the municipality of a comprehensive or other community plan or that the plan was not followed at the time of the area's development. This factor must be documented by evidence of adverse or incompatible land-use relationships, inadequate street layout, improper subdivision, parcels of inadequate shape and size to meet contemporary development standards, or other evidence demonstrating an absence of effective community planning.

(M) The total equalized assessed value of the proposed redevelopment project area has declined for 3 of the last 5 calendar years prior to the year in which the redevelopment project area is designated or is increasing at an annual rate that is less than the balance of the municipality for 3 of the last 5 calendar years for which information is available or is increasing at an annual rate that is less than the Consumer Price Index for All Urban Consumers published by the United States Department of Labor or successor agency for 3 of the last 5 calendar years prior to the year in which the redevelopment project area is designated.

(2) If vacant, the sound growth of the redevelopment project area is impaired by a combination of 2 or more of the following factors, each of which is (i) present, with that presence documented, to a meaningful extent so that a municipality may reasonably find that the factor is clearly present within the intent of the Act and (ii) reasonably distributed throughout the vacant part of the redevelopment project area to which it pertains:

(A) Obsolete platting of vacant land that results in parcels of limited or narrow size or configurations of parcels of irregular size or shape that would be difficult to develop on a planned basis and in a manner compatible with contemporary standards and requirements, or platting that failed to create rights-of-ways for streets or alleys or that created inadequate right-of-way widths for streets, alleys, or other public rights-of-way or that omitted easements for public utilities.

(B) Diversity of ownership of parcels of vacant land sufficient in number to retard or impede the ability to assemble the land for development.

(C) Tax and special assessment delinquencies exist or the property has been the subject of tax sales under the Property Tax Code within the last 5 years.

(D) Deterioration of structures or site improvements in neighboring areas adjacent to the vacant land.

(E) The area has incurred Illinois Environmental Protection Agency or United States Environmental Protection Agency remediation costs for, or a study conducted by an independent consultant recognized as having expertise in environmental remediation has determined a need for, the clean-up of hazardous waste, hazardous substances, or underground storage tanks required by State or federal law, provided that the remediation costs constitute a material impediment to the development or redevelopment of the redevelopment project area.

(F) The total equalized assessed value of the proposed redevelopment project area has declined for 3 of the last 5 calendar years prior to the year in which the redevelopment project area is designated or is increasing at an annual rate that is less than the balance of the municipality for 3 of the last 5 calendar years for which information is available or is increasing at an annual rate that is less than the Consumer Price Index for All Urban Consumers published by the United States Department of Labor or successor agency for 3 of the last 5 calendar years prior to the year in which the redevelopment project area is designated.

(3) If vacant, the sound growth of the redevelopment project area is impaired by one of the following factors that (i) is present, with that presence documented, to a meaningful extent so that a municipality may reasonably find that the factor is clearly present within the intent of the Act and (ii) is reasonably distributed throughout the vacant part of the redevelopment project area to which it pertains:

(A) The area consists of one or more unused quarries, mines, or strip mine ponds.

(B) The area consists of unused rail yards, rail tracks, or railroad rights-of-way.

(C) The area, prior to its designation, is subject to (i) chronic flooding that adversely impacts on real property in the area as certified by a registered professional engineer or appropriate regulatory agency or (ii) surface water that discharges from all or a part of the area and contributes to flooding within the same watershed, but only if the redevelopment project provides for facilities or improvements to contribute to the alleviation of all or part of the flooding.

(D) The area consists of an unused or illegal disposal site containing earth, stone, building debris, or similar materials that were removed from construction, demolition, excavation, or dredge sites.

(E) Prior to November 1, 1999, the area is not less than 50 nor more than 100 acres and 75% of which is vacant (notwithstanding that the area has been used for commercial agricultural purposes within 5 years prior to the designation of the redevelopment project area), and the area meets at least one of the factors itemized in paragraph (1) of this subsection, the area has been designated as a town or village center by ordinance or comprehensive plan adopted prior to January 1, 1982, and the area has not been developed for that designated purpose.

(F) The area qualified as a blighted improved area immediately prior to becoming vacant, unless there has been substantial private investment in the immediately surrounding area.

(b) For any redevelopment project area that has been designated pursuant to this Section by an ordinance adopted prior to November 1, 1999 (the effective date of Public Act 91-478), "conservation area" shall have the meaning set forth in this Section prior to that date.

On and after November 1, 1999, "conservation area" means any improved area within the boundaries of a redevelopment project area located within the territorial limits of the municipality in which 50% or more of the structures in the area have an age of 35 years or more. Such an area is not yet a blighted area but because of a combination of 3 or more of the following factors is detrimental to the public safety, health, morals or welfare and such an area may become a blighted area:

(1) Dilapidation. An advanced state of disrepair or neglect of necessary repairs to the primary structural components of buildings or improvements in such a combination that a documented building condition analysis determines that major repair is required or the defects are so serious and so extensive that the buildings must be removed.

(2) Obsolescence. The condition or process of falling into disuse. Structures have become ill-suited for the original use.

(3) Deterioration. With respect to buildings, defects including, but not limited to, major defects in the secondary building components such as doors, windows, porches, gutters and downspouts, and fascia. With respect to surface improvements, that the condition of roadways, alleys, curbs, gutters, sidewalks, off-street parking, and surface storage areas evidence deterioration, including, but not limited to, surface cracking, crumbling, potholes, depressions, loose paving material, and weeds protruding through paved surfaces.

(4) Presence of structures below minimum code standards. All structures that do not meet the standards of zoning, subdivision, building, fire, and other governmental codes applicable to property, but not including housing and property maintenance codes.

(5) Illegal use of individual structures. The use of structures in violation of applicable federal, State, or local laws, exclusive of those applicable to the presence of structures below minimum code standards.

(6) Excessive vacancies. The presence of buildings that are unoccupied or under-utilized and that represent an adverse influence on the area because of the frequency, extent, or duration of the vacancies.

(7) Lack of ventilation, light, or sanitary facilities. The absence of adequate ventilation for light or air circulation in spaces or rooms without windows, or that require the removal of dust, odor, gas, smoke, or other noxious airborne materials. Inadequate natural light and ventilation means the absence or inadequacy of skylights or windows for interior spaces or rooms and improper window sizes and amounts by room area to window area ratios. Inadequate sanitary facilities refers to the absence or inadequacy of garbage storage and enclosure, bathroom facilities, hot water and kitchens, and structural inadequacies preventing ingress and egress to and from all rooms and units within a building.

(8) Inadequate utilities. Underground and overhead utilities such as storm sewers and storm drainage, sanitary sewers, water lines, and gas, telephone, and electrical services that are shown to be inadequate. Inadequate utilities are those that are: (i) of insufficient capacity to serve the uses in the redevelopment project area, (ii) deteriorated, antiquated, obsolete, or in disrepair, or (iii) lacking within the redevelopment project area.

(9) Excessive land coverage and overcrowding of structures and community facilities. The over-intensive use of property and the crowding of buildings and accessory facilities onto a site. Examples of problem conditions warranting the designation of an area as one exhibiting excessive land coverage are: the presence of buildings either improperly situated on parcels or located on parcels of inadequate size and shape in relation to present-day standards of development for health and safety and the presence of multiple buildings on a single parcel. For there to be a finding of excessive land coverage, these parcels must exhibit one or more of the following conditions: insufficient provision for light and air within or around buildings, increased threat of spread of fire due to the close proximity of buildings, lack of adequate or proper access to a public right-of-way, lack of reasonably required off-street parking, or inadequate provision for loading and service.

(10) Deleterious land use or layout. The existence of incompatible land-use relationships, buildings occupied by inappropriate mixed-uses, or uses considered to be noxious, offensive, or unsuitable for the surrounding area.

(11) Lack of community planning. The proposed redevelopment project area was developed prior to or without the benefit or guidance of a community plan. This means that the development occurred prior to the adoption by the municipality of a comprehensive or other community plan or that the plan was not followed at the time of the area's development. This factor must be documented by evidence of adverse or incompatible land-use relationships, inadequate street layout, improper subdivision, parcels of inadequate shape and size to meet contemporary development standards, or other evidence demonstrating an absence of effective community planning.

(12) The area has incurred Illinois Environmental Protection Agency or United States Environmental Protection Agency remediation costs for, or a study conducted by an independent consultant recognized as having expertise in environmental remediation has determined a need for, the clean-up of hazardous waste, hazardous substances, or underground storage tanks required by State or federal law, provided that the remediation costs constitute a material impediment to the development or redevelopment of the redevelopment project area.

(13) The total equalized assessed value of the proposed redevelopment project area has declined for 3 of the last 5 calendar years for which information is available or is increasing at an annual rate that is less than the balance of the municipality for 3 of the last 5 calendar years for which information is available or is increasing at an annual rate that is less than the Consumer Price Index for All Urban Consumers published by the United States Department of Labor or successor agency for 3 of the last 5 calendar years for which information is available.

(c) "Industrial park" means an area in a blighted or conservation area suitable for use by any manufacturing, industrial, research or transportation enterprise, of facilities to include but not be limited to factories, mills, processing plants, assembly plants, packing plants, fabricating plants, industrial distribution centers, warehouses, repair overhaul or service facilities, freight terminals, research facilities, test facilities or railroad facilities.

(d) "Industrial park conservation area" means an area within the boundaries of a redevelopment project area located within the territorial limits of a municipality that is a labor surplus municipality or within 1 1/2 miles of the territorial limits of a municipality that is a labor surplus municipality if the area is annexed to the municipality; which area is zoned as industrial no later than at the time the municipality by ordinance designates the redevelopment project area, and which area includes both vacant land suitable for use as an industrial park and a blighted area or conservation area contiguous to such vacant land.

(e) "Labor surplus municipality" means a municipality in which, at any time during the 6 months before the municipality by ordinance designates an industrial park conservation area, the unemployment rate was over 6% and was also 100% or more of the national average unemployment rate for that same time as published in the United States Department of Labor Bureau of Labor Statistics publication entitled "The Employment Situation" or its successor publication. For the purpose of this subsection, if unemployment rate statistics for the municipality are not available, the unemployment rate in the municipality shall be deemed to be the same as the unemployment rate in the principal county in which the municipality is located.

(f) "Municipality" shall mean a city, village, incorporated town, or a township that is located in the unincorporated portion of a county with 3 million or more inhabitants, if the county adopted an ordinance that approved the township's redevelopment plan.

(g) "Initial Sales Tax Amounts" means the amount of taxes paid under the Retailers' Occupation Tax Act, Use Tax Act, Service Use Tax Act, the Service Occupation Tax Act, the Municipal Retailers' Occupation Tax Act, and the Municipal Service Occupation Tax Act by retailers and servicemen on transactions at places located in a State Sales Tax Boundary during the calendar year 1985.

(g-1) "Revised Initial Sales Tax Amounts" means the amount of taxes paid under the Retailers' Occupation Tax Act, Use Tax Act, Service Use Tax Act, the Service Occupation Tax Act, the Municipal Retailers' Occupation Tax Act, and the Municipal Service Occupation Tax Act by retailers and servicemen on transactions at places located within the State Sales Tax Boundary revised pursuant to Section 11-74.4-8a(9) of this Act.

(h) "Municipal Sales Tax Increment" means an amount equal to the increase in the aggregate amount of taxes paid to a municipality from the Local Government Tax Fund arising from sales by retailers and servicemen within the redevelopment project area or State Sales Tax Boundary, as the case may be, for as long as the redevelopment project area or State Sales Tax Boundary, as the case may be, exist over and above the aggregate amount of taxes as certified by the Illinois Department of Revenue and paid under the Municipal Retailers' Occupation Tax Act and the Municipal Service Occupation Tax Act by retailers and servicemen, on transactions at places of business located in the redevelopment project area or State Sales Tax Boundary, as the case may be, during the base year which shall be the calendar year immediately prior to the year in which the municipality adopted tax increment allocation financing. For purposes of computing the aggregate amount of such taxes for base years occurring prior to 1985, the Department of Revenue shall determine the Initial Sales Tax Amounts for such taxes and deduct therefrom an amount equal to 4% of the aggregate amount of taxes per year for each year the base year is prior to 1985, but not to exceed a total deduction of 12%. The amount so determined shall be known as the "Adjusted Initial Sales Tax Amounts". For purposes of determining the Municipal Sales Tax Increment, the Department of Revenue shall for each period subtract from the amount paid to the municipality from the Local Government Tax Fund arising from sales by retailers and servicemen on transactions located in the redevelopment project area or the State Sales Tax Boundary, as the case may be, the certified Initial Sales Tax Amounts, the Adjusted Initial Sales Tax Amounts or the Revised Initial Sales Tax Amounts for the Municipal Retailers' Occupation Tax Act and the Municipal Service Occupation Tax Act. For the State Fiscal Year 1989, this calculation shall be made by utilizing the calendar year 1987 to determine the tax amounts received. For the State Fiscal Year 1990, this calculation shall be made by utilizing the period from January 1, 1988, until September 30, 1988, to determine the tax amounts received from retailers and servicemen pursuant to the Municipal Retailers' Occupation Tax and the Municipal Service Occupation Tax Act, which shall have deducted therefrom nine-twelfths of the certified Initial Sales Tax Amounts, the Adjusted Initial Sales Tax Amounts or the Revised Initial Sales Tax Amounts as appropriate. For the State Fiscal Year 1991, this calculation shall be made by utilizing the period from October 1, 1988, to June 30, 1989, to determine the tax amounts received from retailers and servicemen pursuant to the Municipal Retailers' Occupation Tax and the Municipal Service Occupation Tax Act which shall have deducted therefrom nine-twelfths of the certified Initial Sales Tax Amounts, Adjusted Initial Sales Tax Amounts or the Revised Initial Sales Tax Amounts as appropriate. For every State Fiscal Year thereafter, the applicable period shall be the 12 months beginning July 1 and ending June 30 to determine the tax amounts received which shall have deducted therefrom the certified Initial Sales Tax Amounts, the Adjusted Initial Sales Tax Amounts or the Revised Initial Sales Tax Amounts, as the case may be.

(i) "Net State Sales Tax Increment" means the sum of the following: (a) 80% of the first $100,000 of State Sales Tax Increment annually generated within a State Sales Tax Boundary; (b) 60% of the amount in excess of $100,000 but not exceeding $500,000 of State Sales Tax Increment annually generated within a State Sales Tax Boundary; and (c) 40% of all amounts in excess of $500,000 of State Sales Tax Increment annually generated within a State Sales Tax Boundary. If, however, a municipality established a tax increment financing district in a county with a population in excess of 3,000,000 before January 1, 1986, and the municipality entered into a contract or issued bonds after January 1, 1986, but before December 31, 1986, to finance redevelopment project costs within a State Sales Tax Boundary, then the Net State Sales Tax Increment means, for the fiscal years beginning July 1, 1990, and July 1, 1991, 100% of the State Sales Tax Increment annually generated within a State Sales Tax Boundary; and notwithstanding any other provision of this Act, for those fiscal years the Department of Revenue shall distribute to those municipalities 100% of their Net State Sales Tax Increment before any distribution to any other municipality and regardless of whether or not those other municipalities will receive 100% of their Net State Sales Tax Increment. For Fiscal Year 1999, and every year thereafter until the year 2007, for any municipality that has not entered into a contract or has not issued bonds prior to June 1, 1988 to finance redevelopment project costs within a State Sales Tax Boundary, the Net State Sales Tax Increment shall be calculated as follows: By multiplying the Net State Sales Tax Increment by 90% in the State Fiscal Year 1999; 80% in the State Fiscal Year 2000; 70% in the State Fiscal Year 2001; 60% in the State Fiscal Year 2002; 50% in the State Fiscal Year 2003; 40% in the State Fiscal Year 2004; 30% in the State Fiscal Year 2005; 20% in the State Fiscal Year 2006; and 10% in the State Fiscal Year 2007. No payment shall be made for State Fiscal Year 2008 and thereafter.

Municipalities that issued bonds in connection with a redevelopment project in a redevelopment project area within the State Sales Tax Boundary prior to July 29, 1991, or that entered into contracts in connection with a redevelopment project in a redevelopment project area before June 1, 1988, shall continue to receive their proportional share of the Illinois Tax Increment Fund distribution until the date on which the redevelopment project is completed or terminated. If, however, a municipality that issued bonds in connection with a redevelopment project in a redevelopment project area within the State Sales Tax Boundary prior to July 29, 1991 retires the bonds prior to June 30, 2007 or a municipality that entered into contracts in connection with a redevelopment project in a redevelopment project area before June 1, 1988 completes the contracts prior to June 30, 2007, then so long as the redevelopment project is not completed or is not terminated, the Net State Sales Tax Increment shall be calculated, beginning on the date on which the bonds are retired or the contracts are completed, as follows: By multiplying the Net State Sales Tax Increment by 60% in the State Fiscal Year 2002; 50% in the State Fiscal Year 2003; 40% in the State Fiscal Year 2004; 30% in the State Fiscal Year 2005; 20% in the State Fiscal Year 2006; and 10% in the State Fiscal Year 2007. No payment shall be made for State Fiscal Year 2008 and thereafter. Refunding of any bonds issued prior to July 29, 1991, shall not alter the Net State Sales Tax Increment.

(j) "State Utility Tax Increment Amount" means an amount equal to the aggregate increase in State electric and gas tax charges imposed on owners and tenants, other than residential customers, of properties located within the redevelopment project area under Section 9-222 of the Public Utilities Act, over and above the aggregate of such charges as certified by the Department of Revenue and paid by owners and tenants, other than residential customers, of properties within the redevelopment project area during the base year, which shall be the calendar year immediately prior to the year of the adoption of the ordinance authorizing tax increment allocation financing.

(k) "Net State Utility Tax Increment" means the sum of the following: (a) 80% of the first $100,000 of State Utility Tax Increment annually generated by a redevelopment project area; (b) 60% of the amount in excess of $100,000 but not exceeding $500,000 of the State Utility Tax Increment annually generated by a redevelopment project area; and (c) 40% of all amounts in excess of $500,000 of State Utility Tax Increment annually generated by a redevelopment project area. For the State Fiscal Year 1999, and every year thereafter until the year 2007, for any municipality that has not entered into a contract or has not issued bonds prior to June 1, 1988 to finance redevelopment project costs within a redevelopment project area, the Net State Utility Tax Increment shall be calculated as follows: By multiplying the Net State Utility Tax Increment by 90% in the State Fiscal Year 1999; 80% in the State Fiscal Year 2000; 70% in the State Fiscal Year 2001; 60% in the State Fiscal Year 2002; 50% in the State Fiscal Year 2003; 40% in the State Fiscal Year 2004; 30% in the State Fiscal Year 2005; 20% in the State Fiscal Year 2006; and 10% in the State Fiscal Year 2007. No payment shall be made for the State Fiscal Year 2008 and thereafter.

Municipalities that issue bonds in connection with the redevelopment project during the period from June 1, 1988 until 3 years after the effective date of this Amendatory Act of 1988 shall receive the Net State Utility Tax Increment, subject to appropriation, for 15 State Fiscal Years after the issuance of such bonds. For the 16th through the 20th State Fiscal Years after issuance of the bonds, the Net State Utility Tax Increment shall be calculated as follows: By multiplying the Net State Utility Tax Increment by 90% in year 16; 80% in year 17; 70% in year 18; 60% in year 19; and 50% in year 20. Refunding of any bonds issued prior to June 1, 1988, shall not alter the revised Net State Utility Tax Increment payments set forth above.

(l) "Obligations" mean bonds, loans, debentures, notes, special certificates or other evidence of indebtedness issued by the municipality to carry out a redevelopment project or to refund outstanding obligations.

(m) "Payment in lieu of taxes" means those estimated tax revenues from real property in a redevelopment project area derived from real property that has been acquired by a municipality which according to the redevelopment project or plan is to be used for a private use which taxing districts would have received had a municipality not acquired the real property and adopted tax increment allocation financing and which would result from levies made after the time of the adoption of tax increment allocation financing to the time the current equalized value of real property in the redevelopment project area exceeds the total initial equalized value of real property in said area.

(n) "Redevelopment plan" means the comprehensive program of the municipality for development or redevelopment intended by the payment of redevelopment project costs to reduce or eliminate those conditions the existence of which qualified the redevelopment project area as a "blighted area" or "conservation area" or combination thereof or "industrial park conservation area," and thereby to enhance the tax bases of the taxing districts which extend into the redevelopment project area. On and after November 1, 1999 (the effective date of Public Act 91-478), no redevelopment plan may be approved or amended that includes the development of vacant land (i) with a golf course and related clubhouse and other facilities or (ii) designated by federal, State, county, or municipal government as public land for outdoor recreational activities or for nature preserves and used for that purpose within 5 years prior to the adoption of the redevelopment plan. For the purpose of this subsection, "recreational activities" is limited to mean camping and hunting. Each redevelopment plan shall set forth in writing the program to be undertaken to accomplish the objectives and shall include but not be limited to:

(A) an itemized list of estimated redevelopment project costs;

(B) evidence indicating that the redevelopment project area on the whole has not been subject to growth and development through investment by private enterprise;

(C) an assessment of any financial impact of the redevelopment project area on or any increased demand for services from any taxing district affected by the plan and any program to address such financial impact or increased demand;

(D) the sources of funds to pay costs;

(E) the nature and term of the obligations to be issued;

(F) the most recent equalized assessed valuation of the redevelopment project area;

(G) an estimate as to the equalized assessed valuation after redevelopment and the general land uses to apply in the redevelopment project area;

(H) a commitment to fair employment practices and an affirmative action plan;

(I) if it concerns an industrial park conservation area, the plan shall also include a general description of any proposed developer, user and tenant of any property, a description of the type, structure and general character of the facilities to be developed, a description of the type, class and number of new employees to be employed in the operation of the facilities to be developed; and

(J) if property is to be annexed to the municipality, the plan shall include the terms of the annexation agreement.

The provisions of items (B) and (C) of this subsection (n) shall not apply to a municipality that before March 14, 1994 (the effective date of Public Act 88-537) had fixed, either by its corporate authorities or by a commission designated under subsection (k) of Section 11-74.4-4, a time and place for a public hearing as required by subsection (a) of Section 11-74.4-5. No redevelopment plan shall be adopted unless a municipality complies with all of the following requirements:

(1) The municipality finds that the redevelopment project area on the whole has not been subject to growth and development through investment by private enterprise and would not reasonably be anticipated to be developed without the adoption of the redevelopment plan.

(2) The municipality finds that the redevelopment plan and project conform to the comprehensive plan for the development of the municipality as a whole, or, for municipalities with a population of 100,000 or more, regardless of when the redevelopment plan and project was adopted, the redevelopment plan and project either: (i) conforms to the strategic economic development or redevelopment plan issued by the designated planning authority of the municipality, or (ii) includes land uses that have been approved by the planning commission of the municipality.

(3) The redevelopment plan establishes the estimated dates of completion of the redevelopment project and retirement of obligations issued to finance redevelopment project costs. Those dates may not be later than the dates set forth under Section 11-74.4-3.5.

A municipality may by municipal ordinance amend an existing redevelopment plan to conform to this paragraph (3) as amended by Public Act 91-478, which municipal ordinance may be adopted without further hearing or notice and without complying with the procedures provided in this Act pertaining to an amendment to or the initial approval of a redevelopment plan and project and designation of a redevelopment project area.

(3.5) The municipality finds, in the case of an industrial park conservation area, also that the municipality is a labor surplus municipality and that the implementation of the redevelopment plan will reduce unemployment, create new jobs and by the provision of new facilities enhance the tax base of the taxing districts that extend into the redevelopment project area.

(4) If any incremental revenues are being utilized under Section 8(a)(1) or 8(a)(2) of this Act in redevelopment project areas approved by ordinance after January 1, 1986, the municipality finds: (a) that the redevelopment project area would not reasonably be developed without the use of such incremental revenues, and (b) that such incremental revenues will be exclusively utilized for the development of the redevelopment project area.

(5) If the redevelopment plan will not result in displacement of residents from 10 or more inhabited residential units, and the municipality certifies in the plan that such displacement will not result from the plan, a housing impact study need not be performed. If, however, the redevelopment plan would result in the displacement of residents from 10 or more inhabited residential units, or if the redevelopment project area contains 75 or more inhabited residential units and no certification is made, then the municipality shall prepare, as part of the separate feasibility report required by subsection (a) of Section 11-74.4-5, a housing impact study.

Part I of the housing impact study shall include (i) data as to whether the residential units are single family or multi-family units, (ii) the number and type of rooms within the units, if that information is available, (iii) whether the units are inhabited or uninhabited, as determined not less than 45 days before the date that the ordinance or resolution required by subsection (a) of Section 11-74.4-5 is passed, and (iv) data as to the racial and ethnic composition of the residents in the inhabited residential units. The data requirement as to the racial and ethnic composition of the residents in the inhabited residential units shall be deemed to be fully satisfied by data from the most recent federal census.

Part II of the housing impact study shall identify the inhabited residential units in the proposed redevelopment project area that are to be or may be removed. If inhabited residential units are to be removed, then the housing impact study shall identify (i) the number and location of those units that will or may be removed, (ii) the municipality's plans for relocation assistance for those residents in the proposed redevelopment project area whose residences are to be removed, (iii) the availability of replacement housing for those residents whose residences are to be removed, and shall identify the type, location, and cost of the housing, and (iv) the type and extent of relocation assistance to be provided.

(6) On and after November 1, 1999, the housing impact study required by paragraph (5) shall be incorporated in the redevelopment plan for the redevelopment project area.

(7) On and after November 1, 1999, no redevelopment plan shall be adopted, nor an existing plan amended, nor shall residential housing that is occupied by households of low-income and very low-income persons in currently existing redevelopment project areas be removed after November 1, 1999 unless the redevelopment plan provides, with respect to inhabited housing units that are to be removed for households of low-income and very low-income persons, affordable housing and relocation assistance not less than that which would be provided under the federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 and the regulations under that Act, including the eligibility criteria. Affordable housing may be either existing or newly constructed housing. For purposes of this paragraph (7), "low-income households", "very low-income households", and "affordable housing" have the meanings set forth in the Illinois Affordable Housing Act. The municipality shall make a good faith effort to ensure that this affordable housing is located in or near the redevelopment project area within the municipality.

(8) On and after November 1, 1999, if, after the adoption of the redevelopment plan for the redevelopment project area, any municipality desires to amend its redevelopment plan to remove more inhabited residential units than specified in its original redevelopment plan, that change shall be made in accordance with the procedures in subsection (c) of Section 11-74.4-5.

(9) For redevelopment project areas designated prior to November 1, 1999, the redevelopment plan may be amended without further joint review board meeting or hearing, provided that the municipality shall give notice of any such changes by mail to each affected taxing district and registrant on the interested party registry, to authorize the municipality to expend tax increment revenues for redevelopment project costs defined by paragraphs (5) and (7.5), subparagraphs (E) and (F) of paragraph (11), and paragraph (11.5) of subsection (q) of Section 11-74.4-3, so long as the changes do not increase the total estimated redevelopment project costs set out in the redevelopment plan by more than 5% after adjustment for inflation from the date the plan was adopted.

(o) "Redevelopment project" means any public and private development project in furtherance of the objectives of a redevelopment plan. On and after November 1, 1999 (the effective date of Public Act 91-478), no redevelopment plan may be approved or amended that includes the development of vacant land (i) with a golf course and related clubhouse and other facilities or (ii) designated by federal, State, county, or municipal government as public land for outdoor recreational activities or for nature preserves and used for that purpose within 5 years prior to the adoption of the redevelopment plan. For the purpose of this subsection, "recreational activities" is limited to mean camping and hunting.

(p) "Redevelopment project area" means an area designated by the municipality, which is not less in the aggregate than 1 1/2 acres and in respect to which the municipality has made a finding that there exist conditions which cause the area to be classified as an industrial park conservation area or a blighted area or a conservation area, or a combination of both blighted areas and conservation areas.

(p-1) Notwithstanding any provision of this Act to the contrary, on and after August 25, 2009 (the effective date of Public Act 96-680), a redevelopment project area may include areas within a one-half mile radius of an existing or proposed Regional Transportation Authority Suburban Transit Access Route (STAR Line) station without a finding that the area is classified as an industrial park conservation area, a blighted area, a conservation area, or a combination thereof, but only if the municipality receives unanimous consent from the joint review board created to review the proposed redevelopment project area.

(q) "Redevelopment project costs", except for redevelopment project areas created pursuant to subsection (p-1), means and includes the sum total of all reasonable or necessary costs incurred or estimated to be incurred, and any such costs incidental to a redevelopment plan and a redevelopment project. Such costs include, without limitation, the following:

(1) Costs of studies, surveys, development of plans, and specifications, implementation and administration of the redevelopment plan including but not limited to staff and professional service costs for architectural, engineering, legal, financial, planning or other services, provided however that no charges for professional services may be based on a percentage of the tax increment collected; except that on and after November 1, 1999 (the effective date of Public Act 91-478), no contracts for professional services, excluding architectural and engineering services, may be entered into if the terms of the contract extend beyond a period of 3 years. In addition, "redevelopment project costs" shall not include lobbying expenses. After consultation with the municipality, each tax increment consultant or advisor to a municipality that plans to designate or has designated a redevelopment project area shall inform the municipality in writing of any contracts that the consultant or advisor has entered into with entities or individuals that have received, or are receiving, payments financed by tax increment revenues produced by the redevelopment project area with respect to which the consultant or advisor has performed, or will be performing, service for the municipality. This requirement shall be satisfied by the consultant or advisor before the commencement of services for the municipality and thereafter whenever any other contracts with those individuals or entities are executed by the consultant or advisor;

(1.5) After July 1, 1999, annual administrative costs shall not include general overhead or administrative costs of the municipality that would still have been incurred by the municipality if the municipality had not designated a redevelopment project area or approved a redevelopment plan;

(1.6) The cost of marketing sites within the redevelopment project area to prospective businesses, developers, and investors;

(2) Property assembly costs, including but not limited to acquisition of land and other property, real or personal, or rights or interests therein, demolition of buildings, site preparation, site improvements that serve as an engineered barrier addressing ground level or below ground environmental contamination, including, but not limited to parking lots and other concrete or asphalt barriers, and the clearing and grading of land;

(3) Costs of rehabilitation, reconstruction or repair or remodeling of existing public or private buildings, fixtures, and leasehold improvements; and the cost of replacing an existing public building if pursuant to the implementation of a redevelopment project the existing public building is to be demolished to use the site for private investment or devoted to a different use requiring private investment; including any direct or indirect costs relating to Green Globes or LEED certified construction elements or construction elements with an equivalent certification;

(4) Costs of the construction of public works or improvements, including any direct or indirect costs relating to Green Globes or LEED certified construction elements or construction elements with an equivalent certification, except that on and after November 1, 1999, redevelopment project costs shall not include the cost of constructing a new municipal public building principally used to provide offices, storage space, or conference facilities or vehicle storage, maintenance, or repair for administrative, public safety, or public works personnel and that is not intended to replace an existing public building as provided under paragraph (3) of subsection (q) of Section 11-74.4-3 unless either (i) the construction of the new municipal building implements a redevelopment project that was included in a redevelopment plan that was adopted by the municipality prior to November 1, 1999 or (ii) the municipality makes a reasonable determination in the redevelopment plan, supported by information that provides the basis for that determination, that the new municipal building is required to meet an increase in the need for public safety purposes anticipated to result from the implementation of the redevelopment plan;

(5) Costs of job training and retraining projects, including the cost of "welfare to work" programs implemented by businesses located within the redevelopment project area;

(6) Financing costs, including but not limited to all necessary and incidental expenses related to the issuance of obligations and which may include payment of interest on any obligations issued hereunder including interest accruing during the estimated period of construction of any redevelopment project for which such obligations are issued and for not exceeding 36 months thereafter and including reasonable reserves related thereto;

(7) To the extent the municipality by written agreement accepts and approves the same, all or a portion of a taxing district's capital costs resulting from the redevelopment project necessarily incurred or to be incurred within a taxing district in furtherance of the objectives of the redevelopment plan and project.

(7.5) For redevelopment project areas designated (or redevelopment project areas amended to add or increase the number of tax-increment-financing assisted housing units) on or after November 1, 1999, an elementary, secondary, or unit school district's increased costs attributable to assisted housing units located within the redevelopment project area for which the developer or redeveloper receives financial assistance through an agreement with the municipality or because the municipality incurs the cost of necessary infrastructure improvements within the boundaries of the assisted housing sites necessary for the completion of that housing as authorized by this Act, and which costs shall be paid by the municipality from the Special Tax Allocation Fund when the tax increment revenue is received as a result of the assisted housing units and shall be calculated annually as follows:

(A) for foundation districts, excluding any school district in a municipality with a population in excess of 1,000,000, by multiplying the district's increase in attendance resulting from the net increase in new students enrolled in that school district who reside in housing units within the redevelopment project area that have received financial assistance through an agreement with the municipality or because the municipality incurs the cost of necessary infrastructure improvements within the boundaries of the housing sites necessary for the completion of that housing as authorized by this Act since the designation of the redevelopment project area by the most recently available per capita tuition cost as defined in Section 10-20.12a of the School Code less any increase in general State aid as defined in Section 18-8.05 of the School Code or primary State aid as defined in Section 18-8.15 of the School Code attributable to these added new students subject to the following annual limitations:

(i) for unit school districts with a district average 1995-96 Per Capita Tuition Charge of less than $5,900, no more than 25% of the total amount of property tax increment revenue produced by those housing units that have received tax increment finance assistance under this Act;

(ii) for elementary school districts with a district average 1995-96 Per Capita Tuition Charge of less than $5,900, no more than 17% of the total amount of property tax increment revenue produced by those housing units that have received tax increment finance assistance under this Act; and

(iii) for secondary school districts with a district average 1995-96 Per Capita Tuition Charge of less than $5,900, no more than 8% of the total amount of property tax increment revenue produced by those housing units that have received tax increment finance assistance under this Act.

(B) For alternate method districts, flat grant districts, and foundation districts with a district average 1995-96 Per Capita Tuition Charge equal to or more than $5,900, excluding any school district with a population in excess of 1,000,000, by multiplying the district's increase in attendance resulting from the net increase in new students enrolled in that school district who reside in housing units within the redevelopment project area that have received financial assistance through an agreement with the municipality or because the municipality incurs the cost of necessary infrastructure improvements within the boundaries of the housing sites necessary for the completion of that housing as authorized by this Act since the designation of the redevelopment project area by the most recently available per capita tuition cost as defined in Section 10-20.12a of the School Code less any increase in general state aid as defined in Section 18-8.05 of the School Code or primary State aid as defined in Section 18-8.15 of the School Code attributable to these added new students subject to the following annual limitations:

(i) for unit school districts, no more than 40% of the total amount of property tax increment revenue produced by those housing units that have received tax increment finance assistance under this Act;

(ii) for elementary school districts, no more than 27% of the total amount of property tax increment revenue produced by those housing units that have received tax increment finance assistance under this Act; and

(iii) for secondary school districts, no more than 13% of the total amount of property tax increment revenue produced by those housing units that have received tax increment finance assistance under this Act.

(C) For any school district in a municipality with a population in excess of 1,000,000, the following restrictions shall apply to the reimbursement of increased costs under this paragraph (7.5):

(i) no increased costs shall be reimbursed unless the school district certifies that each of the schools affected by the assisted housing project is at or over its student capacity;

(ii) the amount reimbursable shall be reduced by the value of any land donated to the school district by the municipality or developer, and by the value of any physical improvements made to the schools by the municipality or developer; and

(iii) the amount reimbursed may not affect amounts otherwise obligated by the terms of any bonds, notes, or other funding instruments, or the terms of any redevelopment agreement.

Any school district seeking payment under this paragraph (7.5) shall, after July 1 and before September 30 of each year, provide the municipality with reasonable evidence to support its claim for reimbursement before the municipality shall be required to approve or make the payment to the school district. If the school district fails to provide the information during this period in any year, it shall forfeit any claim to reimbursement for that year. School districts may adopt a resolution waiving the right to all or a portion of the reimbursement otherwise required by this paragraph (7.5). By acceptance of this reimbursement the school district waives the right to directly or indirectly set aside, modify, or contest in any manner the establishment of the redevelopment project area or projects;

(7.7) For redevelopment project areas designated (or redevelopment project areas amended to add or increase the number of tax-increment-financing assisted housing units) on or after January 1, 2005 (the effective date of Public Act 93-961), a public library district's increased costs attributable to assisted housing units located within the redevelopment project area for which the developer or redeveloper receives financial assistance through an agreement with the municipality or because the municipality incurs the cost of necessary infrastructure improvements within the boundaries of the assisted housing sites necessary for the completion of that housing as authorized by this Act shall be paid to the library district by the municipality from the Special Tax Allocation Fund when the tax increment revenue is received as a result of the assisted housing units. This paragraph (7.7) applies only if (i) the library district is located in a county that is subject to the Property Tax Extension Limitation Law or (ii) the library district is not located in a county that is subject to the Property Tax Extension Limitation Law but the district is prohibited by any other law from increasing its tax levy rate without a prior voter referendum.

The amount paid to a library district under this paragraph (7.7) shall be calculated by multiplying (i) the net increase in the number of persons eligible to obtain a library card in that district who reside in housing units within the redevelopment project area that have received financial assistance through an agreement with the municipality or because the municipality incurs the cost of necessary infrastructure improvements within the boundaries of the housing sites necessary for the completion of that housing as authorized by this Act since the designation of the redevelopment project area by (ii) the per-patron cost of providing library services so long as it does not exceed $120. The per-patron cost shall be the Total Operating Expenditures Per Capita for the library in the previous fiscal year. The municipality may deduct from the amount that it must pay to a library district under this paragraph any amount that it has voluntarily paid to the library district from the tax increment revenue. The amount paid to a library district under this paragraph (7.7) shall be no more than 2% of the amount produced by the assisted housing units and deposited into the Special Tax Allocation Fund.

A library district is not eligible for any payment under this paragraph (7.7) unless the library district has experienced an increase in the number of patrons from the municipality that created the tax-increment-financing district since the designation of the redevelopment project area.

Any library district seeking payment under this paragraph (7.7) shall, after July 1 and before September 30 of each year, provide the municipality with convincing evidence to support its claim for reimbursement before the municipality shall be required to approve or make the payment to the library district. If the library district fails to provide the information during this period in any year, it shall forfeit any claim to reimbursement for that year. Library districts may adopt a resolution waiving the right to all or a portion of the reimbursement otherwise required by this paragraph (7.7). By acceptance of such reimbursement, the library district shall forfeit any right to directly or indirectly set aside, modify, or contest in any manner whatsoever the establishment of the redevelopment project area or projects;

(8) Relocation costs to the extent that a municipality determines that relocation costs shall be paid or is required to make payment of relocation costs by federal or State law or in order to satisfy subparagraph (7) of subsection (n);

(9) Payment in lieu of taxes;

(10) Costs of job training, retraining, advanced vocational education or career education, including but not limited to courses in occupational, semi-technical or technical fields leading directly to employment, incurred by one or more taxing districts, provided that such costs (i) are related to the establishment and maintenance of additional job training, advanced vocational education or career education programs for persons employed or to be employed by employers located in a redevelopment project area; and (ii) when incurred by a taxing district or taxing districts other than the municipality, are set forth in a written agreement by or among the municipality and the taxing district or taxing districts, which agreement describes the program to be undertaken, including but not limited to the number of employees to be trained, a description of the training and services to be provided, the number and type of positions available or to be available, itemized costs of the program and sources of funds to pay for the same, and the term of the agreement. Such costs include, specifically, the payment by community college districts of costs pursuant to Sections 3-37, 3-38, 3-40 and 3-40.1 of the Public Community College Act and by school districts of costs pursuant to Sections 10-22.20a and 10-23.3a of The School Code;

(11) Interest cost incurred by a redeveloper related to the construction, renovation or rehabilitation of a redevelopment project provided that:

(A) such costs are to be paid directly from the special tax allocation fund established pursuant to this Act;

(B) such payments in any one year may not exceed 30% of the annual interest costs incurred by the redeveloper with regard to the redevelopment project during that year;

(C) if there are not sufficient funds available in the special tax allocation fund to make the payment pursuant to this paragraph (11) then the amounts so due shall accrue and be payable when sufficient funds are available in the special tax allocation fund;

(D) the total of such interest payments paid pursuant to this Act may not exceed 30% of the total (i) cost paid or incurred by the redeveloper for the redevelopment project plus (ii) redevelopment project costs excluding any property assembly costs and any relocation costs incurred by a municipality pursuant to this Act; and

(E) the cost limits set forth in subparagraphs (B) and (D) of paragraph (11) shall be modified for the financing of rehabilitated or new housing units for low-income households and very low-income households, as defined in Section 3 of the Illinois Affordable Housing Act. The percentage of 75% shall be substituted for 30% in subparagraphs (B) and (D) of paragraph (11).

(F) Instead of the eligible costs provided by subparagraphs (B) and (D) of paragraph (11), as modified by this subparagraph, and notwithstanding any other provisions of this Act to the contrary, the municipality may pay from tax increment revenues up to 50% of the cost of construction of new housing units to be occupied by low-income households and very low-income households as defined in Section 3 of the Illinois Affordable Housing Act. The cost of construction of those units may be derived from the proceeds of bonds issued by the municipality under this Act or other constitutional or statutory authority or from other sources of municipal revenue that may be reimbursed from tax increment revenues or the proceeds of bonds issued to finance the construction of that housing.

The eligible costs provided under this subparagraph (F) of paragraph (11) shall be an eligible cost for the construction, renovation, and rehabilitation of all low and very low-income housing units, as defined in Section 3 of the Illinois Affordable Housing Act, within the redevelopment project area. If the low and very low-income units are part of a residential redevelopment project that includes units not affordable to low and very low-income households, only the low and very low-income units shall be eligible for benefits under subparagraph (F) of paragraph (11). The standards for maintaining the occupancy by low-income households and very low-income households, as defined in Section 3 of the Illinois Affordable Housing Act, of those units constructed with eligible costs made available under the provisions of this subparagraph (F) of paragraph (11) shall be established by guidelines adopted by the municipality. The responsibility for annually documenting the initial occupancy of the units by low-income households and very low-income households, as defined in Section 3 of the Illinois Affordable Housing Act, shall be that of the then current owner of the property. For ownership units, the guidelines will provide, at a minimum, for a reasonable recapture of funds, or other appropriate methods designed to preserve the original affordability of the ownership units. For rental units, the guidelines will provide, at a minimum, for the affordability of rent to low and very low-income households. As units become available, they shall be rented to income-eligible tenants. The municipality may modify these guidelines from time to time; the guidelines, however, shall be in effect for as long as tax increment revenue is being used to pay for costs associated with the units or for the retirement of bonds issued to finance the units or for the life of the redevelopment project area, whichever is later.

(11.5) If the redevelopment project area is located within a municipality with a population of more than 100,000, the cost of day care services for children of employees from low-income families working for businesses located within the redevelopment project area and all or a portion of the cost of operation of day care centers established by redevelopment project area businesses to serve employees from low-income families working in businesses located in the redevelopment project area. For the purposes of this paragraph, "low-income families" means families whose annual income does not exceed 80% of the municipal, county, or regional median income, adjusted for family size, as the annual income and municipal, county, or regional median income are determined from time to time by the United States Department of Housing and Urban Development.

(12) Unless explicitly stated herein the cost of construction of new privately-owned buildings shall not be an eligible redevelopment project cost.

(13) After November 1, 1999 (the effective date of Public Act 91-478), none of the redevelopment project costs enumerated in this subsection shall be eligible redevelopment project costs if those costs would provide direct financial support to a retail entity initiating operations in the redevelopment project area while terminating operations at another Illinois location within 10 miles of the redevelopment project area but outside the boundaries of the redevelopment project area municipality. For purposes of this paragraph, termination means a closing of a retail operation that is directly related to the opening of the same operation or like retail entity owned or operated by more than 50% of the original ownership in a redevelopment project area, but it does not mean closing an operation for reasons beyond the control of the retail entity, as documented by the retail entity, subject to a reasonable finding by the municipality that the current location contained inadequate space, had become economically obsolete, or was no longer a viable location for the retailer or serviceman.

(14) No cost shall be a redevelopment project cost in a redevelopment project area if used to demolish, remove, or substantially modify a historic resource, after August 26, 2008 (the effective date of Public Act 95-934), unless no prudent and feasible alternative exists. "Historic resource" for the purpose of this item (14) means (i) a place or structure that is included or eligible for inclusion on the National Register of Historic Places or (ii) a contributing structure in a district on the National Register of Historic Places. This item (14) does not apply to a place or structure for which demolition, removal, or modification is subject to review by the preservation agency of a Certified Local Government designated as such by the National Park Service of the United States Department of the Interior.

If a special service area has been established pursuant to the Special Service Area Tax Act or Special Service Area Tax Law, then any tax increment revenues derived from the tax imposed pursuant to the Special Service Area Tax Act or Special Service Area Tax Law may be used within the redevelopment project area for the purposes permitted by that Act or Law as well as the purposes permitted by this Act.

(q-1) For redevelopment project areas created pursuant to subsection (p-1), redevelopment project costs are limited to those costs in paragraph (q) that are related to the existing or proposed Regional Transportation Authority Suburban Transit Access Route (STAR Line) station.

(r) "State Sales Tax Boundary" means the redevelopment project area or the amended redevelopment project area boundaries which are determined pursuant to subsection (9) of Section 11-74.4-8a of this Act. The Department of Revenue shall certify pursuant to subsection (9) of Section 11-74.4-8a the appropriate boundaries eligible for the determination of State Sales Tax Increment.

(s) "State Sales Tax Increment" means an amount equal to the increase in the aggregate amount of taxes paid by retailers and servicemen, other than retailers and servicemen subject to the Public Utilities Act, on transactions at places of business located within a State Sales Tax Boundary pursuant to the Retailers' Occupation Tax Act, the Use Tax Act, the Service Use Tax Act, and the Service Occupation Tax Act, except such portion of such increase that is paid into the State and Local Sales Tax Reform Fund, the Local Government Distributive Fund, the Local Government Tax Fund and the County and Mass Transit District Fund, for as long as State participation exists, over and above the Initial Sales Tax Amounts, Adjusted Initial Sales Tax Amounts or the Revised Initial Sales Tax Amounts for such taxes as certified by the Department of Revenue and paid under those Acts by retailers and servicemen on transactions at places of business located within the State Sales Tax Boundary during the base year which shall be the calendar year immediately prior to the year in which the municipality adopted tax increment allocation financing, less 3.0% of such amounts generated under the Retailers' Occupation Tax Act, Use Tax Act and Service Use Tax Act and the Service Occupation Tax Act, which sum shall be appropriated to the Department of Revenue to cover its costs of administering and enforcing this Section. For purposes of computing the aggregate amount of such taxes for base years occurring prior to 1985, the Department of Revenue shall compute the Initial Sales Tax Amount for such taxes and deduct therefrom an amount equal to 4% of the aggregate amount of taxes per year for each year the base year is prior to 1985, but not to exceed a total deduction of 12%. The amount so determined shall be known as the "Adjusted Initial Sales Tax Amount". For purposes of determining the State Sales Tax Increment the Department of Revenue shall for each period subtract from the tax amounts received from retailers and servicemen on transactions located in the State Sales Tax Boundary, the certified Initial Sales Tax Amounts, Adjusted Initial Sales Tax Amounts or Revised Initial Sales Tax Amounts for the Retailers' Occupation Tax Act, the Use Tax Act, the Service Use Tax Act and the Service Occupation Tax Act. For the State Fiscal Year 1989 this calculation shall be made by utilizing the calendar year 1987 to determine the tax amounts received. For the State Fiscal Year 1990, this calculation shall be made by utilizing the period from January 1, 1988, until September 30, 1988, to determine the tax amounts received from retailers and servicemen, which shall have deducted therefrom nine-twelfths of the certified Initial Sales Tax Amounts, Adjusted Initial Sales Tax Amounts or the Revised Initial Sales Tax Amounts as appropriate. For the State Fiscal Year 1991, this calculation shall be made by utilizing the period from October 1, 1988, until June 30, 1989, to determine the tax amounts received from retailers and servicemen, which shall have deducted therefrom nine-twelfths of the certified Initial State Sales Tax Amounts, Adjusted Initial Sales Tax Amounts or the Revised Initial Sales Tax Amounts as appropriate. For every State Fiscal Year thereafter, the applicable period shall be the 12 months beginning July 1 and ending on June 30, to determine the tax amounts received which shall have deducted therefrom the certified Initial Sales Tax Amounts, Adjusted Initial Sales Tax Amounts or the Revised Initial Sales Tax Amounts. Municipalities intending to receive a distribution of State Sales Tax Increment must report a list of retailers to the Department of Revenue by October 31, 1988 and by July 31, of each year thereafter.

(t) "Taxing districts" means counties, townships, cities and incorporated towns and villages, school, road, park, sanitary, mosquito abatement, forest preserve, public health, fire protection, river conservancy, tuberculosis sanitarium and any other municipal corporations or districts with the power to levy taxes.

(u) "Taxing districts' capital costs" means those costs of taxing districts for capital improvements that are found by the municipal corporate authorities to be necessary and directly result from the redevelopment project.

(v) As used in subsection (a) of Section 11-74.4-3 of this Act, "vacant land" means any parcel or combination of parcels of real property without industrial, commercial, and residential buildings which has not been used for commercial agricultural purposes within 5 years prior to the designation of the redevelopment project area, unless the parcel is included in an industrial park conservation area or the parcel has been subdivided; provided that if the parcel was part of a larger tract that has been divided into 3 or more smaller tracts that were accepted for recording during the period from 1950 to 1990, then the parcel shall be deemed to have been subdivided, and all proceedings and actions of the municipality taken in that connection with respect to any previously approved or designated redevelopment project area or amended redevelopment project area are hereby validated and hereby declared to be legally sufficient for all purposes of this Act. For purposes of this Section and only for land subject to the subdivision requirements of the Plat Act, land is subdivided when the original plat of the proposed Redevelopment Project Area or relevant portion thereof has been properly certified, acknowledged, approved, and recorded or filed in accordance with the Plat Act and a preliminary plat, if any, for any subsequent phases of the proposed Redevelopment Project Area or relevant portion thereof has been properly approved and filed in accordance with the applicable ordinance of the municipality.

(w) "Annual Total Increment" means the sum of each municipality's annual Net Sales Tax Increment and each municipality's annual Net Utility Tax Increment. The ratio of the Annual Total Increment of each municipality to the Annual Total Increment for all municipalities, as most recently calculated by the Department, shall determine the proportional shares of the Illinois Tax Increment Fund to be distributed to each municipality.

(x) "LEED certified" means any certification level of construction elements by a qualified Leadership in Energy and Environmental Design Accredited Professional as determined by the U.S. Green Building Council.

(y) "Green Globes certified" means any certification level of construction elements by a qualified Green Globes Professional as determined by the Green Building Initiative.

(Source: P.A. 96-328, eff. 8-11-09; 96-630, eff. 1-1-10; 96-680, eff. 8-25-09; 96-1000, eff. 7-2-10; 97-101, eff. 1-1-12.)

(65 ILCS 5/11-74.4-8) (from Ch. 24, par. 11-74.4-8)

Sec. 11-74.4-8. Tax increment allocation financing. A municipality may not adopt tax increment financing in a redevelopment project area after the effective date of this amendatory Act of 1997 that will encompass an area that is currently included in an enterprise zone created under the Illinois Enterprise Zone Act unless that municipality, pursuant to Section 5.4 of the Illinois Enterprise Zone Act, amends the enterprise zone designating ordinance to limit the eligibility for tax abatements as provided in Section 5.4.1 of the Illinois Enterprise Zone Act. A municipality, at the time a redevelopment project area is designated, may adopt tax increment allocation financing by passing an ordinance providing that the ad valorem taxes, if any, arising from the levies upon taxable real property in such redevelopment project area by taxing districts and tax rates determined in the manner provided in paragraph (c) of Section 11-74.4-9 each year after the effective date of the ordinance until redevelopment project costs and all municipal obligations financing redevelopment project costs incurred under this Division have been paid shall be divided as follows:

(a) That portion of taxes levied upon each taxable lot, block, tract or parcel of real property which is attributable to the lower of the current equalized assessed value or the initial equalized assessed value of each such taxable lot, block, tract or parcel of real property in the redevelopment project area shall be allocated to and when collected shall be paid by the county collector to the respective affected taxing districts in the manner required by law in the absence of the adoption of tax increment allocation financing.

(b) Except from a tax levied by a township to retire bonds issued to satisfy court-ordered damages, that portion, if any, of such taxes which is attributable to the increase in the current equalized assessed valuation of each taxable lot, block, tract or parcel of real property in the redevelopment project area over and above the initial equalized assessed value of each property in the project area shall be allocated to and when collected shall be paid to the municipal treasurer who shall deposit said taxes into a special fund called the special tax allocation fund of the municipality for the purpose of paying redevelopment project costs and obligations incurred in the payment thereof. In any county with a population of 3,000,000 or more that has adopted a procedure for collecting taxes that provides for one or more of the installments of the taxes to be billed and collected on an estimated basis, the municipal treasurer shall be paid for deposit in the special tax allocation fund of the municipality, from the taxes collected from estimated bills issued for property in the redevelopment project area, the difference between the amount actually collected from each taxable lot, block, tract, or parcel of real property within the redevelopment project area and an amount determined by multiplying the rate at which taxes were last extended against the taxable lot, block, track, or parcel of real property in the manner provided in subsection (c) of Section 11-74.4-9 by the initial equalized assessed value of the property divided by the number of installments in which real estate taxes are billed and collected within the county; provided that the payments on or before December 31, 1999 to a municipal treasurer shall be made only if each of the following conditions are met:

(1) The total equalized assessed value of the redevelopment project area as last determined was not less than 175% of the total initial equalized assessed value.

(2) Not more than 50% of the total equalized assessed value of the redevelopment project area as last determined is attributable to a piece of property assigned a single real estate index number.

(3) The municipal clerk has certified to the county clerk that the municipality has issued its obligations to which there has been pledged the incremental property taxes of the redevelopment project area or taxes levied and collected on any or all property in the municipality or the full faith and credit of the municipality to pay or secure payment for all or a portion of the redevelopment project costs. The certification shall be filed annually no later than September 1 for the estimated taxes to be distributed in the following year; however, for the year 1992 the certification shall be made at any time on or before March 31, 1992.

(4) The municipality has not requested that the total initial equalized assessed value of real property be adjusted as provided in subsection (b) of Section 11-74.4-9.

The conditions of paragraphs (1) through (4) do not apply after December 31, 1999 to payments to a municipal treasurer made by a county with 3,000,000 or more inhabitants that has adopted an estimated billing procedure for collecting taxes. If a county that has adopted the estimated billing procedure makes an erroneous overpayment of tax revenue to the municipal treasurer, then the county may seek a refund of that overpayment. The county shall send the municipal treasurer a notice of liability for the overpayment on or before the mailing date of the next real estate tax bill within the county. The refund shall be limited to the amount of the overpayment.

It is the intent of this Division that after the effective date of this amendatory Act of 1988 a municipality's own ad valorem tax arising from levies on taxable real property be included in the determination of incremental revenue in the manner provided in paragraph (c) of Section 11-74.4-9. If the municipality does not extend such a tax, it shall annually deposit in the municipality's Special Tax Increment Fund an amount equal to 10% of the total contributions to the fund from all other taxing districts in that year. The annual 10% deposit required by this paragraph shall be limited to the actual amount of municipally produced incremental tax revenues available to the municipality from taxpayers located in the redevelopment project area in that year if: (a) the plan for the area restricts the use of the property primarily to industrial purposes, (b) the municipality establishing the redevelopment project area is a home-rule community with a 1990 population of between 25,000 and 50,000, (c) the municipality is wholly located within a county with a 1990 population of over 750,000 and (d) the redevelopment project area was established by the municipality prior to June 1, 1990. This payment shall be in lieu of a contribution of ad valorem taxes on real property. If no such payment is made, any redevelopment project area of the municipality shall be dissolved.

If a municipality has adopted tax increment allocation financing by ordinance and the County Clerk thereafter certifies the "total initial equalized assessed value as adjusted" of the taxable real property within such redevelopment project area in the manner provided in paragraph (b) of Section 11-74.4-9, each year after the date of the certification of the total initial equalized assessed value as adjusted until redevelopment project costs and all municipal obligations financing redevelopment project costs have been paid the ad valorem taxes, if any, arising from the levies upon the taxable real property in such redevelopment project area by taxing districts and tax rates determined in the manner provided in paragraph (c) of Section 11-74.4-9 shall be divided as follows:

(1) That portion of the taxes levied upon each taxable lot, block, tract or parcel of real property which is attributable to the lower of the current equalized assessed value or "current equalized assessed value as adjusted" or the initial equalized assessed value of each such taxable lot, block, tract, or parcel of real property existing at the time tax increment financing was adopted, minus the total current homestead exemptions under Article 15 of the Property Tax Code in the redevelopment project area shall be allocated to and when collected shall be paid by the county collector to the respective affected taxing districts in the manner required by law in the absence of the adoption of tax increment allocation financing.

(2) That portion, if any, of such taxes which is attributable to the increase in the current equalized assessed valuation of each taxable lot, block, tract, or parcel of real property in the redevelopment project area, over and above the initial equalized assessed value of each property existing at the time tax increment financing was adopted, minus the total current homestead exemptions pertaining to each piece of property provided by Article 15 of the Property Tax Code in the redevelopment project area, shall be allocated to and when collected shall be paid to the municipal Treasurer, who shall deposit said taxes into a special fund called the special tax allocation fund of the municipality for the purpose of paying redevelopment project costs and obligations incurred in the payment thereof.

The municipality may pledge in the ordinance the funds in and to be deposited in the special tax allocation fund for the payment of such costs and obligations. No part of the current equalized assessed valuation of each property in the redevelopment project area attributable to any increase above the total initial equalized assessed value, or the total initial equalized assessed value as adjusted, of such properties shall be used in calculating the general State school aid formula, provided for in Section 18-8 of the School Code, or the primary State aid formula, provided for in Section 18-8.15 of the School Code, until such time as all redevelopment project costs have been paid as provided for in this Section.

Whenever a municipality issues bonds for the purpose of financing redevelopment project costs, such municipality may provide by ordinance for the appointment of a trustee, which may be any trust company within the State, and for the establishment of such funds or accounts to be maintained by such trustee as the municipality shall deem necessary to provide for the security and payment of the bonds. If such municipality provides for the appointment of a trustee, such trustee shall be considered the assignee of any payments assigned by the municipality pursuant to such ordinance and this Section. Any amounts paid to such trustee as assignee shall be deposited in the funds or accounts established pursuant to such trust agreement, and shall be held by such trustee in trust for the benefit of the holders of the bonds, and such holders shall have a lien on and a security interest in such funds or accounts so long as the bonds remain outstanding and unpaid. Upon retirement of the bonds, the trustee shall pay over any excess amounts held to the municipality for deposit in the special tax allocation fund.

When such redevelopment projects costs, including without limitation all municipal obligations financing redevelopment project costs incurred under this Division, have been paid, all surplus funds then remaining in the special tax allocation fund shall be distributed by being paid by the municipal treasurer to the Department of Revenue, the municipality and the county collector; first to the Department of Revenue and the municipality in direct proportion to the tax incremental revenue received from the State and the municipality, but not to exceed the total incremental revenue received from the State or the municipality less any annual surplus distribution of incremental revenue previously made; with any remaining funds to be paid to the County Collector who shall immediately thereafter pay said funds to the taxing districts in the redevelopment project area in the same manner and proportion as the most recent distribution by the county collector to the affected districts of real property taxes from real property in the redevelopment project area.

Upon the payment of all redevelopment project costs, the retirement of obligations, the distribution of any excess monies pursuant to this Section, and final closing of the books and records of the redevelopment project area, the municipality shall adopt an ordinance dissolving the special tax allocation fund for the redevelopment project area and terminating the designation of the redevelopment project area as a redevelopment project area. Title to real or personal property and public improvements acquired by or for the municipality as a result of the redevelopment project and plan shall vest in the municipality when acquired and shall continue to be held by the municipality after the redevelopment project area has been terminated. Municipalities shall notify affected taxing districts prior to November 1 if the redevelopment project area is to be terminated by December 31 of that same year. If a municipality extends estimated dates of completion of a redevelopment project and retirement of obligations to finance a redevelopment project, as allowed by this amendatory Act of 1993, that extension shall not extend the property tax increment allocation financing authorized by this Section. Thereafter the rates of the taxing districts shall be extended and taxes levied, collected and distributed in the manner applicable in the absence of the adoption of tax increment allocation financing.

Nothing in this Section shall be construed as relieving property in such redevelopment project areas from being assessed as provided in the Property Tax Code or as relieving owners of such property from paying a uniform rate of taxes, as required by Section 4 of Article IX of the Illinois Constitution.

(Source: P.A. 98-463, eff. 8-16-13.)

(65 ILCS 5/11-74.6-35)

Sec. 11-74.6-35. Ordinance for tax increment allocation financing.

(a) A municipality, at the time a redevelopment project area is designated, may adopt tax increment allocation financing by passing an ordinance providing that the ad valorem taxes, if any, arising from the levies upon taxable real property within the redevelopment project area by taxing districts and tax rates determined in the manner provided in subsection (b) of Section 11-74.6-40 each year after the effective date of the ordinance until redevelopment project costs and all municipal obligations financing redevelopment project costs incurred under this Act have been paid shall be divided as follows:

(1) That portion of the taxes levied upon each taxable lot, block, tract or parcel of real property that is attributable to the lower of the current equalized assessed value or the initial equalized assessed value or the updated initial equalized assessed value of each taxable lot, block, tract or parcel of real property in the redevelopment project area shall be allocated to and when collected shall be paid by the county collector to the respective affected taxing districts in the manner required by law without regard to the adoption of tax increment allocation financing.

(2) That portion, if any, of those taxes that is attributable to the increase in the current equalized assessed value of each taxable lot, block, tract or parcel of real property in the redevelopment project area, over and above the initial equalized assessed value or the updated initial equalized assessed value of each property in the project area, shall be allocated to and when collected shall be paid by the county collector to the municipal treasurer who shall deposit that portion of those taxes into a special fund called the special tax allocation fund of the municipality for the purpose of paying redevelopment project costs and obligations incurred in the payment of those costs and obligations. In any county with a population of 3,000,000 or more that has adopted a procedure for collecting taxes that provides for one or more of the installments of the taxes to be billed and collected on an estimated basis, the municipal treasurer shall be paid for deposit in the special tax allocation fund of the municipality, from the taxes collected from estimated bills issued for property in the redevelopment project area, the difference between the amount actually collected from each taxable lot, block, tract, or parcel of real property within the redevelopment project area and an amount determined by multiplying the rate at which taxes were last extended against the taxable lot, block, track, or parcel of real property in the manner provided in subsection (b) of Section 11-74.6-40 by the initial equalized assessed value or the updated initial equalized assessed value of the property divided by the number of installments in which real estate taxes are billed and collected within the county, provided that the payments on or before December 31, 1999 to a municipal treasurer shall be made only if each of the following conditions are met:

(A) The total equalized assessed value of the redevelopment project area as last determined was not less than 175% of the total initial equalized assessed value.

(B) Not more than 50% of the total equalized assessed value of the redevelopment project area as last determined is attributable to a piece of property assigned a single real estate index number.

(C) The municipal clerk has certified to the county clerk that the municipality has issued its obligations to which there has been pledged the incremental property taxes of the redevelopment project area or taxes levied and collected on any or all property in the municipality or the full faith and credit of the municipality to pay or secure payment for all or a portion of the redevelopment project costs. The certification shall be filed annually no later than September 1 for the estimated taxes to be distributed in the following year.

The conditions of paragraphs (A) through (C) do not apply after December 31, 1999 to payments to a municipal treasurer made by a county with 3,000,000 or more inhabitants that has adopted an estimated billing procedure for collecting taxes. If a county that has adopted the estimated billing procedure makes an erroneous overpayment of tax revenue to the municipal treasurer, then the county may seek a refund of that overpayment. The county shall send the municipal treasurer a notice of liability for the overpayment on or before the mailing date of the next real estate tax bill within the county. The refund shall be limited to the amount of the overpayment.

(b) It is the intent of this Act that a municipality's own ad valorem tax arising from levies on taxable real property be included in the determination of incremental revenue in the manner provided in paragraph (b) of Section 11-74.6-40.

(c) If a municipality has adopted tax increment allocation financing for a redevelopment project area by ordinance and the county clerk thereafter certifies the total initial equalized assessed value or the total updated initial equalized assessed value of the taxable real property within such redevelopment project area in the manner provided in paragraph (a) or (b) of Section 11-74.6-40, each year after the date of the certification of the total initial equalized assessed value or the total updated initial equalized assessed value until redevelopment project costs and all municipal obligations financing redevelopment project costs have been paid, the ad valorem taxes, if any, arising from the levies upon the taxable real property in the redevelopment project area by taxing districts and tax rates determined in the manner provided in paragraph (b) of Section 11-74.6-40 shall be divided as follows:

(1) That portion of the taxes levied upon each taxable lot, block, tract or parcel of real property that is attributable to the lower of the current equalized assessed value or the initial equalized assessed value, or the updated initial equalized assessed value of each parcel if the updated initial equalized assessed value of that parcel has been certified in accordance with Section 11-74.6-40, whichever has been most recently certified, of each taxable lot, block, tract, or parcel of real property existing at the time tax increment allocation financing was adopted in the redevelopment project area, shall be allocated to and when collected shall be paid by the county collector to the respective affected taxing districts in the manner required by law without regard to the adoption of tax increment allocation financing.

(2) That portion, if any, of those taxes that is attributable to the increase in the current equalized assessed value of each taxable lot, block, tract, or parcel of real property in the redevelopment project area, over and above the initial equalized assessed value of each property existing at the time tax increment allocation financing was adopted in the redevelopment project area, or the updated initial equalized assessed value of each parcel if the updated initial equalized assessed value of that parcel has been certified in accordance with Section 11-74.6-40, shall be allocated to and when collected shall be paid to the municipal treasurer, who shall deposit those taxes into a special fund called the special tax allocation fund of the municipality for the purpose of paying redevelopment project costs and obligations incurred in the payment thereof.

(d) The municipality may pledge in the ordinance the funds in and to be deposited in the special tax allocation fund for the payment of redevelopment project costs and obligations. No part of the current equalized assessed value of each property in the redevelopment project area attributable to any increase above the total initial equalized assessed value or the total initial updated equalized assessed value of the property, shall be used in calculating the general General State aid formula School Aid Formula, provided for in Section 18-8 of the School Code, or the primary State aid formula, provided for in Section 18-8.15 of the School Code, until all redevelopment project costs have been paid as provided for in this Section.

Whenever a municipality issues bonds for the purpose of financing redevelopment project costs, that municipality may provide by ordinance for the appointment of a trustee, which may be any trust company within the State, and for the establishment of any funds or accounts to be maintained by that trustee, as the municipality deems necessary to provide for the security and payment of the bonds. If the municipality provides for the appointment of a trustee, the trustee shall be considered the assignee of any payments assigned by the municipality under that ordinance and this Section. Any amounts paid to the trustee as assignee shall be deposited into the funds or accounts established under the trust agreement, and shall be held by the trustee in trust for the benefit of the holders of the bonds. The holders of those bonds shall have a lien on and a security interest in those funds or accounts while the bonds remain outstanding and unpaid. Upon retirement of the bonds, the trustee shall pay over any excess amounts held to the municipality for deposit in the special tax allocation fund.

When the redevelopment projects costs, including without limitation all municipal obligations financing redevelopment project costs incurred under this Law, have been paid, all surplus funds then remaining in the special tax allocation fund shall be distributed by being paid by the municipal treasurer to the municipality and the county collector; first to the municipality in direct proportion to the tax incremental revenue received from the municipality, but not to exceed the total incremental revenue received from the municipality, minus any annual surplus distribution of incremental revenue previously made. Any remaining funds shall be paid to the county collector who shall immediately distribute that payment to the taxing districts in the redevelopment project area in the same manner and proportion as the most recent distribution by the county collector to the affected districts of real property taxes from real property situated in the redevelopment project area.

Upon the payment of all redevelopment project costs, retirement of obligations and the distribution of any excess moneys under this Section, the municipality shall adopt an ordinance dissolving the special tax allocation fund for the redevelopment project area and terminating the designation of the redevelopment project area as a redevelopment project area. Thereafter the tax levies of taxing districts shall be extended, collected and distributed in the same manner applicable before the adoption of tax increment allocation financing. Municipality shall notify affected taxing districts prior to November if the redevelopment project area is to be terminated by December 31 of that same year.

Nothing in this Section shall be construed as relieving property in a redevelopment project area from being assessed as provided in the Property Tax Code or as relieving owners of that property from paying a uniform rate of taxes, as required by Section 4 of Article IX of the Illinois Constitution.

(Source: P.A. 91-474, eff. 11-1-99.)

Section 940. The Economic Development Project Area Tax Increment Allocation Act of 1995 is amended by changing Section 50 as follows:

(65 ILCS 110/50)

Sec. 50. Special tax allocation fund.

(a) If a county clerk has certified the "total initial equalized assessed value" of the taxable real property within an economic development project area in the manner provided in Section 45, each year after the date of the certification by the county clerk of the "total initial equalized assessed value", until economic development project costs and all municipal obligations financing economic development project costs have been paid, the ad valorem taxes, if any, arising from the levies upon the taxable real property in the economic development project area by taxing districts and tax rates determined in the manner provided in subsection (b) of Section 45 shall be divided as follows:

(1) That portion of the taxes levied upon each taxable lot, block, tract, or parcel of real property that is attributable to the lower of the current equalized assessed value or the initial equalized assessed value of each taxable lot, block, tract, or parcel of real property existing at the time tax increment financing was adopted shall be allocated to (and when collected shall be paid by the county collector to) the respective affected taxing districts in the manner required by law in the absence of the adoption of tax increment allocation financing.

(2) That portion, if any, of the taxes that is attributable to the increase in the current equalized assessed valuation of each taxable lot, block, tract, or parcel of real property in the economic development project area, over and above the initial equalized assessed value of each property existing at the time tax increment financing was adopted, shall be allocated to (and when collected shall be paid to) the municipal treasurer, who shall deposit the taxes into a special fund (called the special tax allocation fund of the municipality) for the purpose of paying economic development project costs and obligations incurred in the payment of those costs.

(b) The municipality, by an ordinance adopting tax increment allocation financing, may pledge the monies in and to be deposited into the special tax allocation fund for the payment of obligations issued under this Act and for the payment of economic development project costs. No part of the current equalized assessed valuation of each property in the economic development project area attributable to any increase above the total initial equalized assessed value of those properties shall be used in calculating the general State school aid formula under Section 18-8 of the School Code or the primary State aid formula under Section 18-8.15 of the School Code, until all economic development projects costs have been paid as provided for in this Section.

(c) When the economic development projects costs, including without limitation all municipal obligations financing economic development project costs incurred under this Act, have been paid, all surplus monies then remaining in the special tax allocation fund shall be distributed by being paid by the municipal treasurer to the county collector, who shall immediately pay the monies to the taxing districts having taxable property in the economic development project area in the same manner and proportion as the most recent distribution by the county collector to those taxing districts of real property taxes from real property in the economic development project area.

(d) Upon the payment of all economic development project costs, retirement of obligations, and distribution of any excess monies under this Section and not later than 23 years from the date of the adoption of the ordinance establishing the economic development project area, the municipality shall adopt an ordinance dissolving the special tax allocation fund for the economic development project area and terminating the designation of the economic development project area as an economic development project area. Thereafter, the rates of the taxing districts shall be extended and taxes shall be levied, collected, and distributed in the manner applicable in the absence of the adoption of tax increment allocation financing.

(e) Nothing in this Section shall be construed as relieving property in the economic development project areas from being assessed as provided in the Property Tax Code or as relieving owners or lessees of that property from paying a uniform rate of taxes as required by Section 4 of Article IX of the Illinois Constitution.

(Source: P.A. 98-463, eff. 8-16-13.)

Section 945. The School Code is amended by changing Sections 1A-8, 1B-5, 1B-6, 1B-7, 1B-8, 1C-1, 1C-2, 1D-1, 1E-20, 1F-20, 1F-62, 1H-20, 1H-70, 2-3.28, 2-3.33, 2-3.51.5, 2-3.66, 2-3.66b, 2-3.84, 2-3.109a, 3-14.21, 7-14A, 10-19, 10-22.5a, 10-22.20, 10-29, 11E-135, 13A-8, 13B-20.20, 13B-45, 13B-50, 13B-50.10, 13B-50.15, 14-7.02, 14-7.02b, 14-7.03, 14-13.01, 14C-12, 17-1, 17-1.2, 17-1.5, 17-2.11, 17-2A, 18-4.3, 18-8.05, 18-8.10, 18-9, 18-12, 26-16, 27-8.1, 27A-9, 27A-11, 29-5, 34-2.3, 34-8.4, 34-18, 34-18.30, and 34-43.1 and by adding Sections 14-7.02c and 18-8.15 as follows:

(105 ILCS 5/1A-8) (from Ch. 122, par. 1A-8)

Sec. 1A-8. Powers of the Board in Assisting Districts Deemed in Financial Difficulties. To promote the financial integrity of school districts, the State Board of Education shall be provided the necessary powers to promote sound financial management and continue operation of the public schools.

(a) The State Superintendent of Education may require a school district, including any district subject to Article 34A of this Code, to share financial information relevant to a proper investigation of the district's financial condition and the delivery of appropriate State financial, technical, and consulting services to the district if the district (i) has been designated, through the State Board of Education's School District Financial Profile System, as on financial warning or financial watch status, (ii) has failed to file an annual financial report, annual budget, deficit reduction plan, or other financial information as required by law, (iii) has been identified, through the district's annual audit or other financial and management information, as in serious financial difficulty in the current or next school year, or (iv) is determined to be likely to fail to fully meet any regularly scheduled, payroll-period obligations when due or any debt service payments when due or both. In addition to financial, technical, and consulting services provided by the State Board of Education, at the request of a school district, the State Superintendent may provide for an independent financial consultant to assist the district review its financial condition and options.

(b) The State Board of Education, after proper investigation of a district's financial condition, may certify that a district, including any district subject to Article 34A, is in financial difficulty when any of the following conditions occur:

(1) The district has issued school or teacher orders for wages as permitted in Sections 8-16, 32-7.2 and 34-76 of this Code.

(2) The district has issued tax anticipation warrants or tax anticipation notes in anticipation of a second year's taxes when warrants or notes in anticipation of current year taxes are still outstanding, as authorized by Sections 17-16, 34-23, 34-59 and 34-63 of this Code, or has issued short-term debt against 2 future revenue sources, such as, but not limited to, tax anticipation warrants and general State aid or primary State aid Aid certificates or tax anticipation warrants and revenue anticipation notes.

(3) The district has for 2 consecutive years shown an excess of expenditures and other financing uses over revenues and other financing sources and beginning fund balances on its annual financial report for the aggregate totals of the Educational, Operations and Maintenance, Transportation, and Working Cash Funds.

(4) The district refuses to provide financial information or cooperate with the State Superintendent in an investigation of the district's financial condition.

(5) The district is likely to fail to fully meet any regularly scheduled, payroll-period obligations when due or any debt service payments when due or both.

No school district shall be certified by the State Board of Education to be in financial difficulty solely by reason of any of the above circumstances arising as a result of (i) the failure of the county to make any distribution of property tax money due the district at the time such distribution is due or (ii) the failure of this State to make timely payments of general State aid, primary State aid, or any of the mandated categoricals; or if the district clearly demonstrates to the satisfaction of the State Board of Education at the time of its determination that such condition no longer exists. If the State Board of Education certifies that a district in a city with 500,000 inhabitants or more is in financial difficulty, the State Board shall so notify the Governor and the Mayor of the city in which the district is located. The State Board of Education may require school districts certified in financial difficulty, except those districts subject to Article 34A, to develop, adopt and submit a financial plan within 45 days after certification of financial difficulty. The financial plan shall be developed according to guidelines presented to the district by the State Board of Education within 14 days of certification. Such guidelines shall address the specific nature of each district's financial difficulties. Any proposed budget of the district shall be consistent with the financial plan submitted to and approved by the State Board of Education.

A district certified to be in financial difficulty, other than a district subject to Article 34A, shall report to the State Board of Education at such times and in such manner as the State Board may direct, concerning the district's compliance with each financial plan. The State Board may review the district's operations, obtain budgetary data and financial statements, require the district to produce reports, and have access to any other information in the possession of the district that it deems relevant. The State Board may issue recommendations or directives within its powers to the district to assist in compliance with the financial plan. The district shall produce such budgetary data, financial statements, reports and other information and comply with such directives. If the State Board of Education determines that a district has failed to comply with its financial plan, the State Board of Education may rescind approval of the plan and appoint a Financial Oversight Panel for the district as provided in Section 1B-4. This action shall be taken only after the district has been given notice and an opportunity to appear before the State Board of Education to discuss its failure to comply with its financial plan.

No bonds, notes, teachers orders, tax anticipation warrants or other evidences of indebtedness shall be issued or sold by a school district or be legally binding upon or enforceable against a local board of education of a district certified to be in financial difficulty unless and until the financial plan required under this Section has been approved by the State Board of Education.

Any financial profile compiled and distributed by the State Board of Education in Fiscal Year 2009 or any fiscal year thereafter shall incorporate such adjustments as may be needed in the profile scores to reflect the financial effects of the inability or refusal of the State of Illinois to make timely disbursements of any general State aid, primary State aid, or mandated categorical aid payments due school districts or to fully reimburse school districts for mandated categorical programs pursuant to reimbursement formulas provided in this School Code.

(Source: P.A. 96-668, eff. 8-25-09; 96-1423, eff. 8-3-10; 97-429, eff. 8-16-11.)

(105 ILCS 5/1B-5) (from Ch. 122, par. 1B-5)

Sec. 1B-5. When a petition for emergency financial assistance for a school district is allowed by the State Board under Section 1B-4, the State Superintendent shall within 10 days thereafter appoint 3 members to serve at the State Superintendent's pleasure on a Financial Oversight Panel for the district. The State Superintendent shall designate one of the members of the Panel to serve as its Chairman. In the event of vacancy or resignation the State Superintendent shall appoint a successor within 10 days of receiving notice thereof.

Members of the Panel shall be selected primarily on the basis of their experience and education in financial management, with consideration given to persons knowledgeable in education finance. A member of the Panel may not be a board member or employee of the district for which the Panel is constituted, nor may a member have a direct financial interest in that district.

Panel members shall serve without compensation, but may be reimbursed for travel and other necessary expenses incurred in the performance of their official duties by the State Board. The amount reimbursed Panel members for their expenses shall be charged to the school district as part of any emergency financial assistance and incorporated as a part of the terms and conditions for repayment of such assistance or shall be deducted from the district's general State aid or primary State aid as provided in Section 1B-8.

The first meeting of the Panel shall be held at the call of the Chairman. The Panel may elect such other officers as it deems appropriate. The Panel shall prescribe the times and places for its meetings and the manner in which regular and special meetings may be called, and shall comply with the Open Meetings Act.

Two members of the Panel shall constitute a quorum, and the affirmative vote of 2 members shall be necessary for any decision or action to be taken by the Panel.

The Panel and the State Superintendent shall cooperate with each other in the exercise of their respective powers. The Panel shall report not later than September 1 annually to the State Board and the State Superintendent with respect to its activities and the condition of the school district for the previous fiscal year.

Any Financial Oversight Panel established under this Article shall remain in existence for not less than 3 years nor more than 10 years from the date the State Board grants the petition under Section 1B-4. If after 3 years the school district has repaid all of its obligations resulting from emergency State financial assistance provided under this Article and has improved its financial situation, the board of education may, not more frequently than once in any 12 month period, petition the State Board to dissolve the Financial Oversight Panel, terminate the oversight responsibility, and remove the district's certification under Section 1A-8 as a district in financial difficulty. In acting on such a petition the State Board shall give additional weight to the recommendations of the State Superintendent and the Financial Oversight Panel.

(Source: P.A. 88-618, eff. 9-9-94.)

(105 ILCS 5/1B-6) (from Ch. 122, par. 1B-6)

Sec. 1B-6. General powers. The purpose of the Financial Oversight Panel shall be to exercise financial control over the board of education, and, when approved by the State Board and the State Superintendent of Education, to furnish financial assistance so that the board can provide public education within the board's jurisdiction while permitting the board to meet its obligations to its creditors and the holders of its notes and bonds. Except as expressly limited by this Article, the Panel shall have all powers necessary to meet its responsibilities and to carry out its purposes and the purposes of this Article, including, but not limited to, the following powers:

(a) to sue and be sued;

(b) to provide for its organization and internal management;

(c) to appoint a Financial Administrator to serve as the chief executive officer of the Panel. The Financial Administrator may be an individual, partnership, corporation, including an accounting firm, or other entity determined by the Panel to be qualified to serve; and to appoint other officers, agents, and employees of the Panel, define their duties and qualifications and fix their compensation and employee benefits;

(d) to approve the local board of education appointments to the positions of treasurer in a Class I county school unit and in each school district which forms a part of a Class II county school unit but which no longer is subject to the jurisdiction and authority of a township treasurer or trustees of schools of a township because the district has withdrawn from the jurisdiction and authority of the township treasurer and the trustees of schools of the township or because those offices have been abolished as provided in subsection (b) or (c) of Section 5-1, and chief school business official, if such official is not the superintendent of the district. Either the board or the Panel may remove such treasurer or chief school business official;

(e) to approve any and all bonds, notes, teachers orders, tax anticipation warrants, and other evidences of indebtedness prior to issuance or sale by the school district; and notwithstanding any other provision of The School Code, as now or hereafter amended, no bonds, notes, teachers orders, tax anticipation warrants or other evidences of indebtedness shall be issued or sold by the school district or be legally binding upon or enforceable against the local board of education unless and until the approval of the Panel has been received;

(f) to approve all property tax levies of the school district and require adjustments thereto as the Panel deems necessary or advisable;

(g) to require and approve a school district financial plan;

(h) to approve and require revisions of the school district budget;

(i) to approve all contracts and other obligations as the Panel deems necessary and appropriate;

(j) to authorize emergency State financial assistance, including requirements regarding the terms and conditions of repayment of such assistance, and to require the board of education to levy a separate local property tax, subject to the limitations of Section 1B-8, sufficient to repay such assistance consistent with the terms and conditions of repayment and the district's approved financial plan and budget;

(k) to request the regional superintendent to make appointments to fill all vacancies on the local school board as provided in Section 10-10;

(l) to recommend dissolution or reorganization of the school district to the General Assembly if in the Panel's judgment the circumstances so require;

(m) to direct a phased reduction in the oversight responsibilities of the Financial Administrator and of the Panel as the circumstances permit;

(n) to determine the amount of emergency State financial assistance to be made available to the school district, and to establish an operating budget for the Panel to be supported by funds available from such assistance, with the assistance and the budget required to be approved by the State Superintendent;

(o) to procure insurance against any loss in such amounts and from such insurers as it deems necessary;

(p) to engage the services of consultants for rendering professional and technical assistance and advice on matters within the Panel's power;

(q) to contract for and to accept any gifts, grants or loans of funds or property or financial or other aid in any form from the federal government, State government, unit of local government, school district or any agency or instrumentality thereof, or from any other private or public source, and to comply with the terms and conditions thereof;

(r) to pay the expenses of its operations based on the Panel's budget as approved by the State Superintendent from emergency financial assistance funds available to the district or from deductions from the district's general State aid or primary State aid;

(s) to do any and all things necessary or convenient to carry out its purposes and exercise the powers given to the Panel by this Article; and

(t) to recommend the creation of a school finance authority pursuant to Article 1F of this Code.

(Source: P.A. 91-357, eff. 7-29-99; 92-855, eff. 12-6-02.)

(105 ILCS 5/1B-7) (from Ch. 122, par. 1B-7)

Sec. 1B-7. Financial Administrator; Powers and Duties. The Financial Administrator appointed by the Financial Oversight Panel shall serve as the Panel's chief executive officer. The Financial Administrator shall exercise the powers and duties required by the Panel, including but not limited to the following:

(a) to provide guidance and recommendations to the local board and officials of the school district in developing the district's financial plan and budget prior to board action;

(b) to direct the local board to reorganize its financial accounts, budgetary systems, and internal accounting and financial controls, in whatever manner the Panel deems appropriate to achieve greater financial responsibility and to reduce financial inefficiency, and to provide technical assistance to aid the district in accomplishing the reorganization;

(c) to make recommendations to the Financial Oversight Panel concerning the school district's financial plan and budget, and all other matters within the scope of the Panel's authority;

(d) to prepare and recommend to the Panel a proposal for emergency State financial assistance for the district, including recommended terms and conditions of repayment, and an operations budget for the Panel to be funded from the emergency assistance or from deductions from the district's general State aid or primary State aid;

(e) to require the local board to prepare and submit preliminary staffing and budgetary analyses annually prior to February 1 in such manner and form as the Financial Administrator shall prescribe; and

(f) subject to the direction of the Panel, to do all other things necessary or convenient to carry out its purposes and exercise the powers given to the Panel under this Article.

(Source: P.A. 88-618, eff. 9-9-94.)

(105 ILCS 5/1B-8) (from Ch. 122, par. 1B-8)

Sec. 1B-8. There is created in the State Treasury a special fund to be known as the School District Emergency Financial Assistance Fund (the "Fund"). The School District Emergency Financial Assistance Fund shall consist of appropriations, loan repayments, grants from the federal government, and donations from any public or private source. Moneys in the Fund may be appropriated only to the Illinois Finance Authority and the State Board for those purposes authorized under this Article and Articles 1F and 1H of this Code. The appropriation may be allocated and expended by the State Board for contractual services to provide technical assistance or consultation to school districts to assess their financial condition and to Financial Oversight Panels that petition for emergency financial assistance grants. The Illinois Finance Authority may provide loans to school districts which are the subject of an approved petition for emergency financial assistance under Section 1B-4, 1F-62, or 1H-65 of this Code. Neither the State Board of Education nor the Illinois Finance Authority may collect any fees for providing these services.

From the amount allocated to each such school district under this Article the State Board shall identify a sum sufficient to cover all approved costs of the Financial Oversight Panel established for the respective school district. If the State Board and State Superintendent of Education have not approved emergency financial assistance in conjunction with the appointment of a Financial Oversight Panel, the Panel's approved costs shall be paid from deductions from the district's general State aid or primary State aid.

The Financial Oversight Panel may prepare and file with the State Superintendent a proposal for emergency financial assistance for the school district and for its operations budget. No expenditures from the Fund shall be authorized by the State Superintendent until he or she has approved the request of the Panel, either as submitted or in such lesser amount determined by the State Superintendent.

The maximum amount of an emergency financial assistance loan which may be allocated to any school district under this Article, including moneys necessary for the operations of the Panel, shall not exceed $4,000 times the number of pupils enrolled in the school district during the school year ending June 30 prior to the date of approval by the State Board of the petition for emergency financial assistance, as certified to the local board and the Panel by the State Superintendent. An emergency financial assistance grant shall not exceed $1,000 times the number of such pupils. A district may receive both a loan and a grant.

The payment of an emergency State financial assistance grant or loan shall be subject to appropriation by the General Assembly. Payment of the emergency State financial assistance loan is subject to the applicable provisions of the Illinois Finance Authority Act. Emergency State financial assistance allocated and paid to a school district under this Article may be applied to any fund or funds from which the local board of education of that district is authorized to make expenditures by law.

Any emergency financial assistance grant proposed by the Financial Oversight Panel and approved by the State Superintendent may be paid in its entirety during the initial year of the Panel's existence or spread in equal or declining amounts over a period of years not to exceed the period of the Panel's existence. An emergency financial assistance loan proposed by the Financial Oversight Panel and approved by the Illinois Finance Authority may be paid in its entirety during the initial year of the Panel's existence or spread in equal or declining amounts over a period of years not to exceed the period of the Panel's existence. All loans made by the Illinois Finance Authority for a school district shall be required to be repaid, with simple interest over the term of the loan at a rate equal to 50% of the one-year Constant Maturity Treasury (CMT) yield as last published by the Board of Governors of the Federal Reserve System before the date on which the district's loan is approved by the Illinois Finance Authority, not later than the date the Financial Oversight Panel ceases to exist. The Panel shall establish and the Illinois Finance Authority shall approve the terms and conditions, including the schedule, of repayments. The schedule shall provide for repayments commencing July 1 of each year or upon each fiscal year's receipt of moneys from a tax levy for emergency financial assistance. Repayment shall be incorporated into the annual budget of the school district and may be made from any fund or funds of the district in which there are moneys available. An emergency financial assistance loan to the Panel or district shall not be considered part of the calculation of a district's debt for purposes of the limitation specified in Section 19-1 of this Code. Default on repayment is subject to the Illinois Grant Funds Recovery Act. When moneys are repaid as provided herein they shall not be made available to the local board for further use as emergency financial assistance under this Article at any time thereafter. All repayments required to be made by a school district shall be received by the State Board and deposited in the School District Emergency Financial Assistance Fund.

In establishing the terms and conditions for the repayment obligation of the school district the Panel shall annually determine whether a separate local property tax levy is required. The board of any school district with a tax rate for educational purposes for the prior year of less than 120% of the maximum rate for educational purposes authorized by Section 17-2 shall provide for a separate tax levy for emergency financial assistance repayment purposes. Such tax levy shall not be subject to referendum approval. The amount of the levy shall be equal to the amount necessary to meet the annual repayment obligations of the district as established by the Panel, or 20% of the amount levied for educational purposes for the prior year, whichever is less. However, no district shall be required to levy the tax if the district's operating tax rate as determined under Section 18-8, or 18-8.05, or 18-8.15 exceeds 200% of the district's tax rate for educational purposes for the prior year.

(Source: P.A. 97-429, eff. 8-16-11.)

(105 ILCS 5/1C-1)

Sec. 1C-1. Purpose. The purpose of this Article is to permit greater flexibility and efficiency in the distribution and use of certain State funds available to local education agencies for the improvement of the quality of educational services pursuant to locally established priorities.

Through fiscal year 2014, this This Article does not apply to school districts having a population in excess of 500,000 inhabitants.

(Source: P.A. 88-555, eff. 7-27-94; 89-15, eff. 5-30-95; 89-397, eff. 8-20-95; 89-626, eff. 8-9-96.)

(105 ILCS 5/1C-2)

Sec. 1C-2. Block grants.

(a) For fiscal year 1999, and each fiscal year thereafter, the State Board of Education shall award to school districts block grants as described in subsection (c). The State Board of Education may adopt rules and regulations necessary to implement this Section. In accordance with Section 2-3.32, all state block grants are subject to an audit. Therefore, block grant receipts and block grant expenditures shall be recorded to the appropriate fund code.

(b) (Blank).

(c) An Early Childhood Education Block Grant shall be created by combining the following programs: Preschool Education, Parental Training and Prevention Initiative. These funds shall be distributed to school districts and other entities on a competitive basis, except that the State Board of Education shall award to a school district having a population exceeding 500,000 inhabitants 37% of the funds in each fiscal year. Not less than 11% of this grant shall be used to fund programs for children ages 0-3, which percentage shall increase to at least 20% by Fiscal Year 2015. However, if, in a given fiscal year, the amount appropriated for the Early Childhood Education Block Grant is insufficient to increase the percentage of the grant to fund programs for children ages 0-3 without reducing the amount of the grant for existing providers of preschool education programs, then the percentage of the grant to fund programs for children ages 0-3 may be held steady instead of increased.

(Source: P.A. 95-793, eff. 1-1-09; 96-423, eff. 8-13-09.)

(105 ILCS 5/1D-1)

Sec. 1D-1. Block grant funding.

(a) For fiscal year 1996 through fiscal year 2014 and each fiscal year thereafter, the State Board of Education shall award to a school district having a population exceeding 500,000 inhabitants a general education block grant and an educational services block grant, determined as provided in this Section, in lieu of distributing to the district separate State funding for the programs described in subsections (b) and (c). The provisions of this Section, however, do not apply to any federal funds that the district is entitled to receive. In accordance with Section 2-3.32, all block grants are subject to an audit. Therefore, block grant receipts and block grant expenditures shall be recorded to the appropriate fund code for the designated block grant.

(b) The general education block grant shall include the following programs: REI Initiative, Summer Bridges, Preschool At Risk, K-6 Comprehensive Arts, School Improvement Support, Urban Education, Scientific Literacy, Substance Abuse Prevention, Second Language Planning, Staff Development, Outcomes and Assessment, K-6 Reading Improvement, 7-12 Continued Reading Improvement, Truants' Optional Education, Hispanic Programs, Agriculture Education, Parental Education, Prevention Initiative, Report Cards, and Criminal Background Investigations. Notwithstanding any other provision of law, all amounts paid under the general education block grant from State appropriations to a school district in a city having a population exceeding 500,000 inhabitants shall be appropriated and expended by the board of that district for any of the programs included in the block grant or any of the board's lawful purposes.

(c) The educational services block grant shall include the following programs: Regular and Vocational Transportation, State Lunch and Free Breakfast Program, Special Education (Personnel, Transportation, Orphanage, Private Tuition), funding for children requiring special education services, Summer School, Educational Service Centers, and Administrator's Academy. This subsection (c) does not relieve the district of its obligation to provide the services required under a program that is included within the educational services block grant. It is the intention of the General Assembly in enacting the provisions of this subsection (c) to relieve the district of the administrative burdens that impede efficiency and accompany single-program funding. The General Assembly encourages the board to pursue mandate waivers pursuant to Section 2-3.25g.

The funding program included in the educational services block grant for funding for children requiring special education services in each fiscal year shall be treated in that fiscal year as a payment to the school district in respect of services provided or costs incurred in the prior fiscal year, calculated in each case as provided in this Section. Nothing in this Section shall change the nature of payments for any program that, apart from this Section, would be or, prior to adoption or amendment of this Section, was on the basis of a payment in a fiscal year in respect of services provided or costs incurred in the prior fiscal year, calculated in each case as provided in this Section.

(d) For fiscal year 1996 through fiscal year 2014 and each fiscal year thereafter, the amount of the district's block grants shall be determined as follows: (i) with respect to each program that is included within each block grant, the district shall receive an amount equal to the same percentage of the current fiscal year appropriation made for that program as the percentage of the appropriation received by the district from the 1995 fiscal year appropriation made for that program, and (ii) the total amount that is due the district under the block grant shall be the aggregate of the amounts that the district is entitled to receive for the fiscal year with respect to each program that is included within the block grant that the State Board of Education shall award the district under this Section for that fiscal year. In the case of the Summer Bridges program, the amount of the district's block grant shall be equal to 44% of the amount of the current fiscal year appropriation made for that program.

(e) The district is not required to file any application or other claim in order to receive the block grants to which it is entitled under this Section. The State Board of Education shall make payments to the district of amounts due under the district's block grants on a schedule determined by the State Board of Education.

(f) A school district to which this Section applies shall report to the State Board of Education on its use of the block grants in such form and detail as the State Board of Education may specify. In addition, the report must include the following description for the district, which must also be reported to the General Assembly: block grant allocation and expenditures by program; population and service levels by program; and administrative expenditures by program. The State Board of Education shall ensure that the reporting requirements for the district are the same as for all other school districts in this State.

(g) Through fiscal year 2014, this This paragraph provides for the treatment of block grants under Article 1C for purposes of calculating the amount of block grants for a district under this Section. Those block grants under Article 1C are, for this purpose, treated as included in the amount of appropriation for the various programs set forth in paragraph (b) above. The appropriation in each current fiscal year for each block grant under Article 1C shall be treated for these purposes as appropriations for the individual program included in that block grant. The proportion of each block grant so allocated to each such program included in it shall be the proportion which the appropriation for that program was of all appropriations for such purposes now in that block grant, in fiscal 1995.

Payments to the school district under this Section with respect to each program for which payments to school districts generally, as of the date of this amendatory Act of the 92nd General Assembly, are on a reimbursement basis shall continue to be made to the district on a reimbursement basis, pursuant to the provisions of this Code governing those programs.

(h) Notwithstanding any other provision of law, any school district receiving a block grant under this Section may classify all or a portion of the funds that it receives in a particular fiscal year from any block grant authorized under this Code or from general State aid pursuant to Section 18-8.05 of this Code (other than supplemental general State aid) as funds received in connection with any funding program for which it is entitled to receive funds from the State in that fiscal year (including, without limitation, any funding program referred to in subsection (c) of this Section), regardless of the source or timing of the receipt. The district may not classify more funds as funds received in connection with the funding program than the district is entitled to receive in that fiscal year for that program. Any classification by a district must be made by a resolution of its board of education. The resolution must identify the amount of any block grant or general State aid to be classified under this subsection (h) and must specify the funding program to which the funds are to be treated as received in connection therewith. This resolution is controlling as to the classification of funds referenced therein. A certified copy of the resolution must be sent to the State Superintendent of Education. The resolution shall still take effect even though a copy of the resolution has not been sent to the State Superintendent of Education in a timely manner. No classification under this subsection (h) by a district shall affect the total amount or timing of money the district is entitled to receive under this Code. No classification under this subsection (h) by a district shall in any way relieve the district from or affect any requirements that otherwise would apply with respect to the block grant as provided in this Section, including any accounting of funds by source, reporting expenditures by original source and purpose, reporting requirements, or requirements of provision of services.

(Source: P.A. 97-238, eff. 8-2-11; 97-324, eff. 8-12-11; 97-813, eff. 7-13-12.)

(105 ILCS 5/1E-20)

(This Section scheduled to be repealed in accordance with 105 ILCS 5/1E-165)

Sec. 1E-20. Members of Authority; meetings.

(a) When a petition for a School Finance Authority is allowed by the State Board under Section 1E-15 of this Code, the State Superintendent shall within 10 days thereafter appoint 5 members to serve on a School Finance Authority for the district. Of the initial members, 2 shall be appointed to serve a term of 2 years and 3 shall be appointed to serve a term of 3 years. Thereafter, each member shall serve for a term of 3 years and until his or her successor has been appointed. The State Superintendent shall designate one of the members of the Authority to serve as its Chairperson. In the event of vacancy or resignation, the State Superintendent shall, within 10 days after receiving notice, appoint a successor to serve out that member's term. The State Superintendent may remove a member for incompetence, malfeasance, neglect of duty, or other just cause.

Members of the Authority shall be selected primarily on the basis of their experience and education in financial management, with consideration given to persons knowledgeable in education finance. Two members of the Authority shall be residents of the school district that the Authority serves. A member of the Authority may not be a member of the district's school board or an employee of the district nor may a member have a direct financial interest in the district.

Authority members shall serve without compensation, but may be reimbursed by the State Board for travel and other necessary expenses incurred in the performance of their official duties. Unless paid from bonds issued under Section 1E-65 of this Code, the amount reimbursed members for their expenses shall be charged to the school district as part of any emergency financial assistance and incorporated as a part of the terms and conditions for repayment of the assistance or shall be deducted from the district's general State aid or primary State aid as provided in Section 1B-8 of this Code.

The Authority may elect such officers as it deems appropriate.

(b) The first meeting of the Authority shall be held at the call of the Chairperson. The Authority shall prescribe the times and places for its meetings and the manner in which regular and special meetings may be called and shall comply with the Open Meetings Act.

Three members of the Authority shall constitute a quorum. When a vote is taken upon any measure before the Authority, a quorum being present, a majority of the votes of the members voting on the measure shall determine the outcome.

(Source: P.A. 92-547, eff. 6-13-02.)

(105 ILCS 5/1F-20)

(This Section scheduled to be repealed in accordance with 105 ILCS 5/1F-165)

Sec. 1F-20. Members of Authority; meetings.

(a) Upon establishment of a School Finance Authority under Section 1F-15 of this Code, the State Superintendent shall within 15 days thereafter appoint 5 members to serve on a School Finance Authority for the district. Of the initial members, 2 shall be appointed to serve a term of 2 years and 3 shall be appointed to serve a term of 3 years. Thereafter, each member shall serve for a term of 3 years and until his or her successor has been appointed. The State Superintendent shall designate one of the members of the Authority to serve as its Chairperson. In the event of vacancy or resignation, the State Superintendent shall, within 10 days after receiving notice, appoint a successor to serve out that member's term. The State Superintendent may remove a member for incompetence, malfeasance, neglect of duty, or other just cause.

Members of the Authority shall be selected primarily on the basis of their experience and education in financial management, with consideration given to persons knowledgeable in education finance. Two members of the Authority shall be residents of the school district that the Authority serves. A member of the Authority may not be a member of the district's school board or an employee of the district nor may a member have a direct financial interest in the district.

Authority members shall be paid a stipend approved by the State Superintendent of not more than $100 per meeting and may be reimbursed by the State Board for travel and other necessary expenses incurred in the performance of their official duties. Unless paid from bonds issued under Section 1F-65 of this Code, the amount reimbursed members for their expenses shall be charged to the school district as part of any emergency financial assistance and incorporated as a part of the terms and conditions for repayment of the assistance or shall be deducted from the district's general State aid or primary State aid as provided in Section 1B-8 of this Code.

The Authority may elect such officers as it deems appropriate.

(b) The first meeting of the Authority shall be held at the call of the Chairperson. The Authority shall prescribe the times and places for its meetings and the manner in which regular and special meetings may be called and shall comply with the Open Meetings Act.

Three members of the Authority shall constitute a quorum. When a vote is taken upon any measure before the Authority, a quorum being present, a majority of the votes of the members voting on the measure shall determine the outcome.

(Source: P.A. 94-234, eff. 7-1-06.)

(105 ILCS 5/1F-62)

(This Section scheduled to be repealed in accordance with 105 ILCS 5/1F-165)

Sec. 1F-62. School District Emergency Financial Assistance Fund; grants and loans.

(a) Moneys in the School District Emergency Financial Assistance Fund established under Section 1B-8 of this Code may be allocated and expended by the State Board as grants to provide technical and consulting services to school districts to assess their financial condition and by the Illinois Finance Authority for emergency financial assistance loans to a School Finance Authority that petitions for emergency financial assistance. An emergency financial assistance loan to a School Finance Authority or borrowing from sources other than the State shall not be considered as part of the calculation of a district's debt for purposes of the limitation specified in Section 19-1 of this Code. From the amount allocated to each School Finance Authority, the State Board shall identify a sum sufficient to cover all approved costs of the School Finance Authority. If the State Board and State Superintendent have not approved emergency financial assistance in conjunction with the appointment of a School Finance Authority, the Authority's approved costs shall be paid from deductions from the district's general State aid or primary State aid.

The School Finance Authority may prepare and file with the State Superintendent a proposal for emergency financial assistance for the school district and for its operations budget. No expenditures shall be authorized by the State Superintendent until he or she has approved the proposal of the School Finance Authority, either as submitted or in such lesser amount determined by the State Superintendent.

(b) The amount of an emergency financial assistance loan that may be allocated to a School Finance Authority under this Article, including moneys necessary for the operations of the School Finance Authority, and borrowing from sources other than the State shall not exceed, in the aggregate, $4,000 times the number of pupils enrolled in the district during the school year ending June 30 prior to the date of approval by the State Board of the petition for emergency financial assistance, as certified to the school board and the School Finance Authority by the State Superintendent. However, this limitation does not apply to borrowing by the district secured by amounts levied by the district prior to establishment of the School Finance Authority. An emergency financial assistance grant shall not exceed $1,000 times the number of such pupils. A district may receive both a loan and a grant.

(c) The payment of a State emergency financial assistance grant or loan shall be subject to appropriation by the General Assembly. State emergency financial assistance allocated and paid to a School Finance Authority under this Article may be applied to any fund or funds from which the School Finance Authority is authorized to make expenditures by law.

(d) Any State emergency financial assistance proposed by the School Finance Authority and approved by the State Superintendent may be paid in its entirety during the initial year of the School Finance Authority's existence or spread in equal or declining amounts over a period of years not to exceed the period of the School Finance Authority's existence. The State Superintendent shall not approve any loan to the School Finance Authority unless the School Finance Authority has been unable to borrow sufficient funds to operate the district.

All loan payments made from the School District Emergency Financial Assistance Fund to a School Finance Authority shall be required to be repaid not later than the date the School Finance Authority ceases to exist, with simple interest over the term of the loan at a rate equal to 50% of the one-year Constant Maturity Treasury (CMT) yield as last published by the Board of Governors of the Federal Reserve System before the date on which the School Finance Authority's loan is approved by the State Board.

The School Finance Authority shall establish and the Illinois Finance Authority shall approve the terms and conditions of the loan, including the schedule of repayments. The schedule shall provide for repayments commencing July 1 of each year or upon each fiscal year's receipt of moneys from a tax levy for emergency financial assistance. Repayment shall be incorporated into the annual budget of the district and may be made from any fund or funds of the district in which there are moneys available. Default on repayment is subject to the Illinois Grant Funds Recovery Act. When moneys are repaid as provided in this Section, they shall not be made available to the School Finance Authority for further use as emergency financial assistance under this Article at any time thereafter. All repayments required to be made by a School Finance Authority shall be received by the State Board and deposited in the School District Emergency Financial Assistance Fund.

In establishing the terms and conditions for the repayment obligation of the School Finance Authority, the School Finance Authority shall annually determine whether a separate local property tax levy is required to meet that obligation. The School Finance Authority shall provide for a separate tax levy for emergency financial assistance repayment purposes. This tax levy shall not be subject to referendum approval. The amount of the levy shall not exceed the amount necessary to meet the annual emergency financial repayment obligations of the district, including principal and interest, as established by the School Finance Authority.

(Source: P.A. 94-234, eff. 7-1-06.)

(105 ILCS 5/1H-20)

Sec. 1H-20. Members of Panel; meetings.

(a) Upon establishment of a Financial Oversight Panel under Section 1H-15 of this Code, the State Superintendent shall within 15 working days thereafter appoint 5 members to serve on a Financial Oversight Panel for the district. Members appointed to the Panel shall serve at the pleasure of the State Superintendent. The State Superintendent shall designate one of the members of the Panel to serve as its Chairperson. In the event of vacancy or resignation, the State Superintendent shall, within 10 days after receiving notice, appoint a successor to serve out that member's term.

(b) Members of the Panel shall be selected primarily on the basis of their experience and education in financial management, with consideration given to persons knowledgeable in education finance. Two members of the Panel shall be residents of the school district that the Panel serves. A member of the Panel may not be a member of the district's school board or an employee of the district nor may a member have a direct financial interest in the district.

(c) Panel members may be reimbursed by the State Board for travel and other necessary expenses incurred in the performance of their official duties. The amount reimbursed members for their expenses shall be charged to the school district as part of any emergency financial assistance and incorporated as a part of the terms and conditions for repayment of the assistance or shall be deducted from the district's general State aid or primary State aid as provided in Section 1H-65 of this Code.

(d) With the exception of the chairperson, who shall be designated as provided in subsection (a) of this Section, the Panel may elect such officers as it deems appropriate.

(e) The first meeting of the Panel shall be held at the call of the Chairperson. The Panel shall prescribe the times and places for its meetings and the manner in which regular and special meetings may be called and shall comply with the Open Meetings Act. The Panel shall also comply with the Freedom of Information Act.

(f) Three members of the Panel shall constitute a quorum. A majority of members present is required to pass a measure.

(Source: P.A. 97-429, eff. 8-16-11.)

(105 ILCS 5/1H-70)

Sec. 1H-70. Tax anticipation warrants, tax anticipation notes, revenue anticipation certificates or notes, general State aid or primary State aid anticipation certificates, and lines of credit. With the approval of the State Superintendent and provided that the district is unable to secure short-term financing after 3 attempts, a Panel shall have the same power as a district to do the following:

(1) issue tax anticipation warrants under the provisions of Section 17-16 of this Code against taxes levied by either the school board or the Panel pursuant to Section 1H-25 of this Code;

(2) issue tax anticipation notes under the provisions of the Tax Anticipation Note Act against taxes levied by either the school board or the Panel pursuant to Section 1H-25 of this Code;

(3) issue revenue anticipation certificates or notes under the provisions of the Revenue Anticipation Act;

(4) issue general State aid or primary State aid anticipation certificates under the provisions of Section 18-18 of this Code; and

(5) establish and utilize lines of credit under the provisions of Section 17-17 of this Code.

Tax anticipation warrants, tax anticipation notes, revenue anticipation certificates or notes, general State aid or primary State aid anticipation certificates, and lines of credit are considered borrowing from sources other than the State and are subject to Section 1H-65 of this Code.

(Source: P.A. 97-429, eff. 8-16-11.)

(105 ILCS 5/2-3.28) (from Ch. 122, par. 2-3.28)

Sec. 2-3.28. Rules and regulations of budget and accounting systems. To prescribe rules and regulations defining what shall constitute a budget and accounting system required under this Act. The rules and regulations shall prescribe the minimum extent of verification, the type of audit, the extent of the audit report and shall require compliance with statutory requirements and standards and such requirements as the State Board of Education deems necessary for an adequate budget and accounting system. For the 2015-2016 school year and thereafter, the rules and regulations shall prescribe a system for accounting for revenues and expenditures at the individual school level that includes without limitation the following:

(1) accounting for expenditures for school administration, regular instruction, special education instruction, instructional support services, and pupil support services;

(2) salary expenditures reflecting actual staff salaries at each school;

(3) accounting for operations, including non-instructional pupil services, facilities, and business services; and

(4) such other requirements as the State Board of Education deems necessary to provide for a uniform and transparent system of accounting at the school level.

(Source: P.A. 81-1508.)

(105 ILCS 5/2-3.33) (from Ch. 122, par. 2-3.33)

Sec. 2-3.33. Recomputation of claims. To recompute within 3 years from the final date for filing of a claim any claim for reimbursement to any school district if the claim has been found to be incorrect and to adjust subsequent claims accordingly, and to recompute and adjust any such claims within 6 years from the final date for filing when there has been an adverse court or administrative agency decision on the merits affecting the tax revenues of the school district. However, no such adjustment shall be made regarding equalized assessed valuation unless the district's equalized assessed valuation is changed by greater than $250,000 or 2%. Any adjustments for claims recomputed for the 2013-2014 school year and prior school years shall be applied to the apportionment of primary State financial aid in Section 18-8.15 of this Code beginning in the 2014-2015 school year and thereafter.

Except in the case of an adverse court or administrative agency decision, no recomputation of a State aid claim shall be made pursuant to this Section as a result of a reduction in the assessed valuation of a school district from the assessed valuation of the district reported to the State Board of Education by the Department of Revenue under Section 18-8.05 or 18-8.15 of this Code unless the requirements of Section 16-15 of the Property Tax Code and Section 2-3.84 of this Code are complied with in all respects.

This paragraph applies to all requests for recomputation of a general State aid or primary State aid claim received after June 30, 2003. In recomputing a general State aid or primary State aid claim that was originally calculated using an extension limitation equalized assessed valuation under paragraph (3) of subsection (G) of Section 18-8.05 of this Code or paragraph (3) of subsection (h) of Section 18-8.15 of this Code, a qualifying reduction in equalized assessed valuation shall be deducted from the extension limitation equalized assessed valuation that was used in calculating the original claim.

From the total amount of general State aid or primary State aid to be provided to districts, adjustments as a result of recomputation under this Section together with adjustments under Section 2-3.84 must not exceed $25 million, in the aggregate for all districts under both Sections combined, of the general State aid or primary State aid appropriation in any fiscal year; if necessary, amounts shall be prorated among districts. If it is necessary to prorate claims under this paragraph, then that portion of each prorated claim that is approved but not paid in the current fiscal year may be resubmitted as a valid claim in the following fiscal year.

(Source: P.A. 93-845, eff. 7-30-04.)

(105 ILCS 5/2-3.51.5)

Sec. 2-3.51.5. School Safety and Educational Improvement Block Grant Program. To improve the level of education and safety of students from kindergarten through grade 12 in school districts and State-recognized, non-public schools. The State Board of Education is authorized to fund a School Safety and Educational Improvement Block Grant Program.

(1) For school districts, the program shall provide funding for school safety, textbooks and software, electronic textbooks and the technological equipment necessary to gain access to and use electronic textbooks, teacher training and curriculum development, school improvements, remediation programs under subsection (a) of Section 2-3.64, school report cards under Section 10-17a, and criminal history records checks under Sections 10-21.9 and 34-18.5. For State-recognized, non-public schools, the program shall provide funding for secular textbooks and software, criminal history records checks, and health and safety mandates to the extent that the funds are expended for purely secular purposes. A school district or laboratory school as defined in Section 18-8, or 18-8.05, or 18-8.15 is not required to file an application in order to receive the categorical funding to which it is entitled under this Section. Funds for the School Safety and Educational Improvement Block Grant Program shall be distributed to school districts and laboratory schools based on the prior year's best 3 months average daily attendance. Funds for the School Safety and Educational Improvement Block Grant Program shall be distributed to State-recognized, non-public schools based on the average daily attendance figure for the previous school year provided to the State Board of Education. The State Board of Education shall develop an application that requires State-recognized, non-public schools to submit average daily attendance figures. A State-recognized, non-public school must submit the application and average daily attendance figure prior to receiving funds under this Section. The State Board of Education shall promulgate rules and regulations necessary for the implementation of this program.

(2) Distribution of moneys to school districts and State-recognized, non-public schools shall be made in 2 semi-annual installments, one payment on or before October 30, and one payment prior to April 30, of each fiscal year.

(3) Grants under the School Safety and Educational Improvement Block Grant Program shall be awarded provided there is an appropriation for the program, and funding levels for each district shall be prorated according to the amount of the appropriation.

(4) The provisions of this Section are in the public interest, are for the public benefit, and serve secular public purposes.

(Source: P.A. 95-707, eff. 1-11-08; 96-1403, eff. 7-29-10.)

(105 ILCS 5/2-3.66) (from Ch. 122, par. 2-3.66)

Sec. 2-3.66. Truants' alternative and optional education programs. To establish projects to offer modified instructional programs or other services designed to prevent students from dropping out of school, including programs pursuant to Section 2-3.41, and to serve as a part time or full time option in lieu of regular school attendance and to award grants to local school districts, educational service regions or community college districts from appropriated funds to assist districts in establishing such projects. The education agency may operate its own program or enter into a contract with another not-for-profit entity to implement the program. The projects shall allow dropouts, up to and including age 21, potential dropouts, including truants, uninvolved, unmotivated and disaffected students, as defined by State Board of Education rules and regulations, to enroll, as an alternative to regular school attendance, in an optional education program which may be established by school board policy and is in conformance with rules adopted by the State Board of Education. Truants' Alternative and Optional Education programs funded pursuant to this Section shall be planned by a student, the student's parents or legal guardians, unless the student is 18 years or older, and school officials and shall culminate in an individualized optional education plan. Such plan shall focus on academic or vocational skills, or both, and may include, but not be limited to, evening school, summer school, community college courses, adult education, preparation courses for the high school level test of General Educational Development, vocational training, work experience, programs to enhance self concept and parenting courses. School districts which are awarded grants pursuant to this Section shall be authorized to provide day care services to children of students who are eligible and desire to enroll in programs established and funded under this Section, but only if and to the extent that such day care is necessary to enable those eligible students to attend and participate in the programs and courses which are conducted pursuant to this Section. School districts and regional offices of education may claim general State aid under Section 18-8.05 or primary State aid under Section 18-8.15 for students enrolled in truants' alternative and optional education programs, provided that such students are receiving services that are supplemental to a program leading to a high school diploma and are otherwise eligible to be claimed for general State aid under Section 18-8.05 or primary State aid under Section 18-8.15, as applicable.

(Source: P.A. 96-734, eff. 8-25-09.)

(105 ILCS 5/2-3.66b)

Sec. 2-3.66b. IHOPE Program.

(a) There is established the Illinois Hope and Opportunity Pathways through Education (IHOPE) Program. The State Board of Education shall implement and administer the IHOPE Program. The goal of the IHOPE Program is to develop a comprehensive system in this State to re-enroll significant numbers of high school dropouts in programs that will enable them to earn their high school diploma.

(b) The IHOPE Program shall award grants, subject to appropriation for this purpose, to educational service regions and a school district organized under Article 34 of this Code from appropriated funds to assist in establishing instructional programs and other services designed to re-enroll high school dropouts. From any funds appropriated for the IHOPE Program, the State Board of Education may use up to 5% for administrative costs, including the performance of a program evaluation and the hiring of staff to implement and administer the program.

The IHOPE Program shall provide incentive grant funds for regional offices of education and a school district organized under Article 34 of this Code to develop partnerships with school districts, public community colleges, and community groups to build comprehensive plans to re-enroll high school dropouts in their regions or districts.

Programs funded through the IHOPE Program shall allow high school dropouts, up to and including age 21 notwithstanding Section 26-2 of this Code, to re-enroll in an educational program in conformance with rules adopted by the State Board of Education. Programs may include without limitation comprehensive year-round programming, evening school, summer school, community college courses, adult education, vocational training, work experience, programs to enhance self-concept, and parenting courses. Any student in the IHOPE Program who wishes to earn a high school diploma must meet the prerequisites to receiving a high school diploma specified in Section 27-22 of this Code and any other graduation requirements of the student's district of residence. Any student who successfully completes the requirements for his or her graduation shall receive a diploma identifying the student as graduating from his or her district of residence.

(c) In order to be eligible for funding under the IHOPE Program, an interested regional office of education or a school district organized under Article 34 of this Code shall develop an IHOPE Plan to be approved by the State Board of Education. The State Board of Education shall develop rules for the IHOPE Program that shall set forth the requirements for the development of the IHOPE Plan. Each Plan shall involve school districts, public community colleges, and key community programs that work with high school dropouts located in an educational service region or the City of Chicago before the Plan is sent to the State Board for approval. No funds may be distributed to a regional office of education or a school district organized under Article 34 of this Code until the State Board has approved the Plan.

(d) A regional office of education or a school district organized under Article 34 of this Code may operate its own program funded by the IHOPE Program or enter into a contract with other not-for-profit entities, including school districts, public community colleges, and not-for-profit community-based organizations, to operate a program.

A regional office of education or a school district organized under Article 34 of this Code that receives an IHOPE grant from the State Board of Education may provide funds under a sub-grant, as specified in the IHOPE Plan, to other not-for-profit entities to provide services according to the IHOPE Plan that was developed. These other entities may include school districts, public community colleges, or not-for-profit community-based organizations or a cooperative partnership among these entities.

(e) In order to distribute funding based upon the need to ensure delivery of programs that will have the greatest impact, IHOPE Program funding must be distributed based upon the proportion of dropouts in the educational service region or school district, in the case of a school district organized under Article 34 of this Code, to the total number of dropouts in this State. This formula shall employ the dropout data provided by school districts to the State Board of Education.

A regional office of education or a school district organized under Article 34 of this Code may claim State aid under Section 18-8.05 or 18-8.15 of this Code for students enrolled in a program funded by the IHOPE Program, provided that the State Board of Education has approved the IHOPE Plan and that these students are receiving services that are meeting the requirements of Section 27-22 of this Code for receipt of a high school diploma and are otherwise eligible to be claimed for general State aid under Section 18-8.05 of this Code or primary State aid under Section 18-8.15 of this Code, including provisions related to the minimum number of days of pupil attendance pursuant to Section 10-19 of this Code and the minimum number of daily hours of school work and any exceptions thereto as defined by the State Board of Education in rules.

(f) IHOPE categories of programming may include the following:

(1) Full-time programs that are comprehensive, year-round programs.

(2) Part-time programs combining work and study scheduled at various times that are flexible to the needs of students.

(3) Online programs and courses in which students take courses and complete on-site, supervised tests that measure the student's mastery of a specific course needed for graduation. Students may take courses online and earn credit or students may prepare to take supervised tests for specific courses for credit leading to receipt of a high school diploma.

(4) Dual enrollment in which students attend high school classes in combination with community college classes or students attend community college classes while simultaneously earning high school credit and eventually a high school diploma.

(g) In order to have successful comprehensive programs re-enrolling and graduating low-skilled high school dropouts, programs funded through the IHOPE Program shall include all of the following components:

(1) Small programs (70 to 100 students) at a separate school site with a distinct identity. Programs may be larger with specific need and justification, keeping in mind that it is crucial to keep programs small to be effective.

(2) Specific performance-based goals and outcomes and measures of enrollment, attendance, skills, credits, graduation, and the transition to college, training, and employment.

(3) Strong, experienced leadership and teaching staff who are provided with ongoing professional development.

(4) Voluntary enrollment.

(5) High standards for student learning, integrating work experience, and education, including during the school year and after school, and summer school programs that link internships, work, and learning.

(6) Comprehensive programs providing extensive support services.

(7) Small teams of students supported by full-time paid mentors who work to retain and help those students graduate.

(8) A comprehensive technology learning center with Internet access and broad-based curriculum focusing on academic and career subject areas.

(9) Learning opportunities that incorporate action into study.

(h) Programs funded through the IHOPE Program must report data to the State Board of Education as requested. This information shall include, but is not limited to, student enrollment figures, attendance information, course completion data, graduation information, and post-graduation information, as available.

(i) Rules must be developed by the State Board of Education to set forth the fund distribution process to regional offices of education and a school district organized under Article 34 of this Code, the planning and the conditions upon which an IHOPE Plan would be approved by State Board, and other rules to develop the IHOPE Program.

(Source: P.A. 96-106, eff. 7-30-09.)

(105 ILCS 5/2-3.84) (from Ch. 122, par. 2-3.84)

Sec. 2-3.84. In calculating the amount of State aid to be apportioned to the various school districts in this State, the State Board of Education shall incorporate and deduct the total aggregate adjustments to assessments made by the State Property Tax Appeal Board or Cook County Board of Appeals, as reported pursuant to Section 16-15 of the Property Tax Code or Section 129.1 of the Revenue Act of 1939 by the Department of Revenue, from the equalized assessed valuation that is otherwise to be utilized in the initial calculation.

From the total amount of general State aid or primary State aid to be provided to districts, adjustments under this Section together with adjustments as a result of recomputation under Section 2-3.33 must not exceed $25 million, in the aggregate for all districts under both Sections combined, of the general State aid or primary State aid appropriation in any fiscal year; if necessary, amounts shall be prorated among districts. If it is necessary to prorate claims under this paragraph, then that portion of each prorated claim that is approved but not paid in the current fiscal year may be resubmitted as a valid claim in the following fiscal year.

(Source: P.A. 93-845, eff. 7-30-04.)

(105 ILCS 5/2-3.109a)

Sec. 2-3.109a. Laboratory schools grant eligibility. A laboratory school as defined in Section 18-8 or 18-8.15 may apply for and be eligible to receive, subject to the same restrictions applicable to school districts, any grant administered by the State Board of Education that is available for school districts.

(Source: P.A. 90-566, eff. 1-2-98.)

(105 ILCS 5/3-14.21) (from Ch. 122, par. 3-14.21)

Sec. 3-14.21. Inspection of schools.

(a) The regional superintendent shall inspect and survey all public schools under his or her supervision and notify the board of education, or the trustees of schools in a district with trustees, in writing before July 30, whether or not the several schools in their district have been kept as required by law, using forms provided by the State Board of Education which are based on the Health/Life Safety Code for Public Schools adopted under Section 2-3.12. The regional superintendent shall report his or her findings to the State Board of Education on forms provided by the State Board of Education.

(b) If the regional superintendent determines that a school board has failed in a timely manner to correct urgent items identified in a previous life-safety report completed under Section 2-3.12 or as otherwise previously ordered by the regional superintendent, the regional superintendent shall order the school board to adopt and submit to the regional superintendent a plan for the immediate correction of the building violations. This plan shall be adopted following a public hearing that is conducted by the school board on the violations and the plan and that is preceded by at least 7 days' prior notice of the hearing published in a newspaper of general circulation within the school district. If the regional superintendent determines in the next annual inspection that the plan has not been completed and that the violations have not been corrected, the regional superintendent shall submit a report to the State Board of Education with a recommendation that the State Board withhold from payments of general State aid or primary State aid due to the district an amount necessary to correct the outstanding violations. The State Board, upon notice to the school board and to the regional superintendent, shall consider the report at a meeting of the State Board, and may order that a sufficient amount of general State aid or primary State aid be withheld from payments due to the district to correct the violations. This amount shall be paid to the regional superintendent who shall contract on behalf of the school board for the correction of the outstanding violations.

(c) The Office of the State Fire Marshal or a qualified fire official, as defined in Section 2-3.12 of this Code, to whom the State Fire Marshal has delegated his or her authority shall conduct an annual fire safety inspection of each school building in this State. The State Fire Marshal or the fire official shall coordinate its inspections with the regional superintendent. The inspection shall be based on the fire safety code authorized in Section 2-3.12 of this Code. Any violations shall be reported in writing to the regional superintendent and shall reference the specific code sections where a discrepancy has been identified within 15 days after the inspection has been conducted. The regional superintendent shall address those violations that are not corrected in a timely manner pursuant to subsection (b) of this Section. The inspection must be at no cost to the school district.

(d) If a municipality or, in the case of an unincorporated area, a county or, if applicable, a fire protection district wishes to perform new construction inspections under the jurisdiction of a regional superintendent, then the entity must register this wish with the regional superintendent. These inspections must be based on the building code authorized in Section 2-3.12 of this Code. The inspections must be at no cost to the school district.

(Source: P.A. 96-734, eff. 8-25-09.)

(105 ILCS 5/7-14A) (from Ch. 122, par. 7-14A)

Sec. 7-14A. Annexation Compensation. There shall be no accounting made after a mere change in boundaries when no new district is created, except that those districts whose enrollment increases by 90% or more as a result of annexing territory detached from another district pursuant to this Article are eligible for supplementary State aid payments in accordance with Section 11E-135 of this Code. Eligible annexing districts shall apply to the State Board of Education for supplementary State aid payments by submitting enrollment figures for the year immediately preceding and the year immediately following the effective date of the boundary change for both the district gaining territory and the district losing territory. Copies of any intergovernmental agreements between the district gaining territory and the district losing territory detailing any transfer of fund balances and staff must also be submitted. In all instances of changes in boundaries, the district losing territory shall not count the average daily attendance of pupils living in the territory during the year preceding the effective date of the boundary change in its claim for reimbursement under Section 18-8 or 18-8.15 for the school year following the effective date of the change in boundaries and the district receiving the territory shall count the average daily attendance of pupils living in the territory during the year preceding the effective date of the boundary change in its claim for reimbursement under Section 18-8 or 18-8.15 for the school year following the effective date of the change in boundaries. The changes to this Section made by this amendatory Act of the 95th General Assembly are intended to be retroactive and applicable to any annexation taking effect on or after July 1, 2004.

(Source: P.A. 95-707, eff. 1-11-08.)

(105 ILCS 5/10-19) (from Ch. 122, par. 10-19)

Sec. 10-19. Length of school term - experimental programs. Each school board shall annually prepare a calendar for the school term, specifying the opening and closing dates and providing a minimum term of at least 185 days to insure 176 days of actual pupil attendance, computable under Section 18-8.05 or 18-8.15, except that for the 1980-1981 school year only 175 days of actual pupil attendance shall be required because of the closing of schools pursuant to Section 24-2 on January 29, 1981 upon the appointment by the President of that day as a day of thanksgiving for the freedom of the Americans who had been held hostage in Iran. Any days allowed by law for teachers' institutes institute but not used as such or used as parental institutes as provided in Section 10-22.18d shall increase the minimum term by the school days not so used. Except as provided in Section 10-19.1, the board may not extend the school term beyond such closing date unless that extension of term is necessary to provide the minimum number of computable days. In case of such necessary extension school employees shall be paid for such additional time on the basis of their regular contracts. A school board may specify a closing date earlier than that set on the annual calendar when the schools of the district have provided the minimum number of computable days under this Section. Nothing in this Section prevents the board from employing superintendents of schools, principals and other nonteaching personnel for a period of 12 months, or in the case of superintendents for a period in accordance with Section 10-23.8, or prevents the board from employing other personnel before or after the regular school term with payment of salary proportionate to that received for comparable work during the school term.

A school board may make such changes in its calendar for the school term as may be required by any changes in the legal school holidays prescribed in Section 24-2. A school board may make changes in its calendar for the school term as may be necessary to reflect the utilization of teachers' institute days as parental institute days as provided in Section 10-22.18d.

The calendar for the school term and any changes must be submitted to and approved by the regional superintendent of schools before the calendar or changes may take effect.

With the prior approval of the State Board of Education and subject to review by the State Board of Education every 3 years, any school board may, by resolution of its board and in agreement with affected exclusive collective bargaining agents, establish experimental educational programs, including but not limited to programs for self-directed learning or outside of formal class periods, which programs when so approved shall be considered to comply with the requirements of this Section as respects numbers of days of actual pupil attendance and with the other requirements of this Act as respects courses of instruction.

(Source: P.A. 93-1036, eff. 9-14-04; revised 11-12-13.)

(105 ILCS 5/10-22.5a) (from Ch. 122, par. 10-22.5a)

Sec. 10-22.5a. Attendance by dependents of United States military personnel, foreign exchange students, and certain nonresident pupils.

(a) To enter into written agreements with cultural exchange organizations, or with nationally recognized eleemosynary institutions that promote excellence in the arts, mathematics, or science. The written agreements may provide for tuition free attendance at the local district school by foreign exchange students, or by nonresident pupils of eleemosynary institutions. The local board of education, as part of the agreement, may require that the cultural exchange program or the eleemosynary institutions provide services to the district in exchange for the waiver of nonresident tuition.

To enter into written agreements with adjacent school districts to provide for tuition free attendance by a student of the adjacent district when requested for the student's health and safety by the student or parent and both districts determine that the student's health or safety will be served by such attendance. Districts shall not be required to enter into such agreements nor be required to alter existing transportation services due to the attendance of such non-resident pupils.

(a-5) If, at the time of enrollment, a dependent of United States military personnel is housed in temporary housing located outside of a school district, but will be living within the district within 60 days after the time of initial enrollment, the dependent must be allowed to enroll, subject to the requirements of this subsection (a-5), and must not be charged tuition. Any United States military personnel attempting to enroll a dependent under this subsection (a-5) shall provide proof that the dependent will be living within the district within 60 days after the time of initial enrollment. Proof of residency may include, but is not limited to, postmarked mail addressed to the military personnel and sent to an address located within the district, a lease agreement for occupancy of a residence located within the district, or proof of ownership of a residence located within the district.

(b) Nonresident pupils and foreign exchange students attending school on a tuition free basis under such agreements and nonresident dependents of United States military personnel attending school on a tuition free basis may be counted for the purposes of determining the apportionment of State aid provided under Section 18-8.05 or 18-8.15 of this Code, provided that any cultural exchange organization or eleemosynary institutions wishing to participate in an agreement authorized under this Section must be approved in writing by the State Board of Education. The State Board of Education may establish reasonable rules to determine the eligibility of cultural exchange organizations or eleemosynary institutions wishing to participate in agreements authorized under this Section. No organization or institution participating in agreements authorized under this Section may exclude any individual for participation in its program on account of the person's race, color, sex, religion or nationality.

(Source: P.A. 93-740, eff. 7-15-04.)

(105 ILCS 5/10-22.20) (from Ch. 122, par. 10-22.20)

Sec. 10-22.20. Classes for adults and youths whose schooling has been interrupted; conditions for State reimbursement; use of child care facilities.

(a) To establish special classes for the instruction (1) of persons of age 21 years or over, and (2) of persons less than age 21 and not otherwise in attendance in public school, for the purpose of providing adults in the community, and youths whose schooling has been interrupted, with such additional basic education, vocational skill training, and other instruction as may be necessary to increase their qualifications for employment or other means of self-support and their ability to meet their responsibilities as citizens including courses of instruction regularly accepted for graduation from elementary or high schools and for Americanization and General Educational Development Review classes.

The board shall pay the necessary expenses of such classes out of school funds of the district, including costs of student transportation and such facilities or provision for child-care as may be necessary in the judgment of the board to permit maximum utilization of the courses by students with children, and other special needs of the students directly related to such instruction. The expenses thus incurred shall be subject to State reimbursement, as provided in this Section. The board may make a tuition charge for persons taking instruction who are not subject to State reimbursement, such tuition charge not to exceed the per capita cost of such classes.

The cost of such instruction, including the additional expenses herein authorized, incurred for recipients of financial aid under the Illinois Public Aid Code, or for persons for whom education and training aid has been authorized under Section 9-8 of that Code, shall be assumed in its entirety from funds appropriated by the State to the Illinois Community College Board.

(b) The Illinois Community College Board shall establish the standards for the courses of instruction reimbursed under this Section. The Illinois Community College Board shall supervise the administration of the programs. The Illinois Community College Board shall determine the cost of instruction in accordance with standards established by the Illinois Community College Board, including therein other incidental costs as herein authorized, which shall serve as the basis of State reimbursement in accordance with the provisions of this Section. In the approval of programs and the determination of the cost of instruction, the Illinois Community College Board shall provide for the maximum utilization of federal funds for such programs. The Illinois Community College Board shall also provide for:

(1) the development of an index of need for program planning and for area funding allocations, as defined by the Illinois Community College Board;

(2) the method for calculating hours of instruction, as defined by the Illinois Community College Board, claimable for reimbursement and a method to phase in the calculation and for adjusting the calculations in cases where the services of a program are interrupted due to circumstances beyond the control of the program provider;

(3) a plan for the reallocation of funds to increase the amount allocated for grants based upon program performance as set forth in subsection (d) below; and

(4) the development of standards for determining grants based upon performance as set forth in subsection (d) below and a plan for the phased-in implementation of those standards.

For instruction provided by school districts and community college districts beginning July 1, 1996 and thereafter, reimbursement provided by the Illinois Community College Board for classes authorized by this Section shall be provided from funds appropriated for the reimbursement criteria set forth in subsection (c) below.

(c) Upon the annual approval of the Illinois Community College Board, reimbursement shall be first provided for transportation, child care services, and other special needs of the students directly related to instruction and then from the funds remaining an amount equal to the product of the total credit hours or units of instruction approved by the Illinois Community College Board, multiplied by the following:

(1) For adult basic education, the maximum reimbursement per credit hour or per unit of instruction shall be equal to (i) through fiscal year 2014, the general state aid per pupil foundation level established in subsection (B) of Section 18-8.05, divided by 60, or (ii) in fiscal year 2015 and thereafter, the foundation level established pursuant to subsection (b) of Section 18-8.15 of this Code, divided by 60;

(2) The maximum reimbursement per credit hour or per unit of instruction in subparagraph (1) above shall be weighted for students enrolled in classes defined as vocational skills and approved by the Illinois Community College Board by 1.25;

(3) The maximum reimbursement per credit hour or per unit of instruction in subparagraph (1) above shall be multiplied by .90 for students enrolled in classes defined as adult secondary education programs and approved by the Illinois Community College Board;

(4) (Blank); and

(5) Funding for program years after 1999-2000 shall be determined by the Illinois Community College Board.

(d) Upon its annual approval, the Illinois Community College Board shall provide grants to eligible programs for supplemental activities to improve or expand services under the Adult Education Act. Eligible programs shall be determined based upon performance outcomes of students in the programs as set by the Illinois Community College Board.

(e) Reimbursement under this Section shall not exceed the actual costs of the approved program.

If the amount appropriated to the Illinois Community College Board for reimbursement under this Section is less than the amount required under this Act, the apportionment shall be proportionately reduced.

School districts and community college districts may assess students up to $3.00 per credit hour, for classes other than Adult Basic Education level programs, if needed to meet program costs.

(f) An education plan shall be established for each adult or youth whose schooling has been interrupted and who is participating in the instructional programs provided under this Section.

Each school board and community college shall keep an accurate and detailed account of the students assigned to and receiving instruction under this Section who are subject to State reimbursement and shall submit reports of services provided commencing with fiscal year 1997 as required by the Illinois Community College Board.

For classes authorized under this Section, a credit hour or unit of instruction is equal to 15 hours of direct instruction for students enrolled in approved adult education programs at midterm and making satisfactory progress, in accordance with standards established by the Illinois Community College Board.

(g) Upon proof submitted to the Illinois Department of Human Services of the payment of all claims submitted under this Section, that Department shall apply for federal funds made available therefor and any federal funds so received shall be paid into the General Revenue Fund in the State Treasury.

School districts or community colleges providing classes under this Section shall submit applications to the Illinois Community College Board for preapproval in accordance with the standards established by the Illinois Community College Board. Payments shall be made by the Illinois Community College Board based upon approved programs. Interim expenditure reports may be required by the Illinois Community College Board. Final claims for the school year shall be submitted to the regional superintendents for transmittal to the Illinois Community College Board. Final adjusted payments shall be made by September 30.

If a school district or community college district fails to provide, or is providing unsatisfactory or insufficient classes under this Section, the Illinois Community College Board may enter into agreements with public or private educational or other agencies other than the public schools for the establishment of such classes.

(h) If a school district or community college district establishes child-care facilities for the children of participants in classes established under this Section, it may extend the use of these facilities to students who have obtained employment and to other persons in the community whose children require care and supervision while the parent or other person in charge of the children is employed or otherwise absent from the home during all or part of the day. It may make the facilities available before and after as well as during regular school hours to school age and preschool age children who may benefit thereby, including children who require care and supervision pending the return of their parent or other person in charge of their care from employment or other activity requiring absence from the home.

The Illinois Community College Board shall pay to the board the cost of care in the facilities for any child who is a recipient of financial aid under the Illinois Public Aid Code.

The board may charge for care of children for whom it cannot make claim under the provisions of this Section. The charge shall not exceed per capita cost, and to the extent feasible, shall be fixed at a level which will permit utilization by employed parents of low or moderate income. It may also permit any other State or local governmental agency or private agency providing care for children to purchase care.

After July 1, 1970 when the provisions of Section 10-20.20 become operative in the district, children in a child-care facility shall be transferred to the kindergarten established under that Section for such portion of the day as may be required for the kindergarten program, and only the prorated costs of care and training provided in the Center for the remaining period shall be charged to the Illinois Department of Human Services or other persons or agencies paying for such care.

(i) The provisions of this Section shall also apply to school districts having a population exceeding 500,000.

(j) In addition to claiming reimbursement under this Section, a school district may claim general State aid under Section 18-8.05 or primary State aid under Section 18-8.15 for any student under age 21 who is enrolled in courses accepted for graduation from elementary or high school and who otherwise meets the requirements of Section 18-8.05 or 18-8.15, as applicable.

(Source: P.A. 95-331, eff. 8-21-07.)

(105 ILCS 5/10-29)

Sec. 10-29. Remote educational programs.

(a) For purposes of this Section, "remote educational program" means an educational program delivered to students in the home or other location outside of a school building that meets all of the following criteria:

(1) A student may participate in the program only after the school district, pursuant to adopted school board policy, and a person authorized to enroll the student under Section 10-20.12b of this Code determine that a remote educational program will best serve the student's individual learning needs. The adopted school board policy shall include, but not be limited to, all of the following:

(A) Criteria for determining that a remote educational program will best serve a student's individual learning needs. The criteria must include consideration of, at a minimum, a student's prior attendance, disciplinary record, and academic history.

(B) Any limitations on the number of students or grade levels that may participate in a remote educational program.

(C) A description of the process that the school district will use to approve participation in the remote educational program. The process must include without limitation a requirement that, for any student who qualifies to receive services pursuant to the federal Individuals with Disabilities Education Improvement Act of 2004, the student's participation in a remote educational program receive prior approval from the student's individualized education program team.

(D) A description of the process the school district will use to develop and approve a written remote educational plan that meets the requirements of subdivision (5) of this subsection (a).

(E) A description of the system the school district will establish to calculate the number of clock hours a student is participating in instruction in accordance with the remote educational program.

(F) A description of the process for renewing a remote educational program at the expiration of its term.

(G) Such other terms and provisions as the school district deems necessary to provide for the establishment and delivery of a remote educational program.

(2) The school district has determined that the remote educational program's curriculum is aligned to State learning standards and that the program offers instruction and educational experiences consistent with those given to students at the same grade level in the district.

(3) The remote educational program is delivered by instructors that meet the following qualifications:

(A) they are certificated under Article 21 of this Code;

(B) they meet applicable highly qualified criteria under the federal No Child Left Behind Act of 2001; and

(C) they have responsibility for all of the following elements of the program: planning instruction, diagnosing learning needs, prescribing content delivery through class activities, assessing learning, reporting outcomes to administrators and parents and guardians, and evaluating the effects of instruction.

(4) During the period of time from and including the opening date to the closing date of the regular school term of the school district established pursuant to Section 10-19 of this Code, participation in a remote educational program may be claimed for general State aid purposes under Section 18-8.05 of this Code or primary State aid purposes under Section 18-8.15 of this Code on any calendar day, notwithstanding whether the day is a day of pupil attendance or institute day on the school district's calendar or any other provision of law restricting instruction on that day. If the district holds year-round classes in some buildings, the district shall classify each student's participation in a remote educational program as either on a year-round or a non-year-round schedule for purposes of claiming general State aid or primary State aid. Outside of the regular school term of the district, the remote educational program may be offered as part of any summer school program authorized by this Code.

(5) Each student participating in a remote educational program must have a written remote educational plan that has been approved by the school district and a person authorized to enroll the student under Section 10-20.12b of this Code. The school district and a person authorized to enroll the student under Section 10-20.12b of this Code must approve any amendment to a remote educational plan. The remote educational plan must include, but is not limited to, all of the following:

(A) Specific achievement goals for the student aligned to State learning standards.

(B) A description of all assessments that will be used to measure student progress, which description shall indicate the assessments that will be administered at an attendance center within the school district.

(C) A description of the progress reports that will be provided to the school district and the person or persons authorized to enroll the student under Section 10-20.12b of this Code.

(D) Expectations, processes, and schedules for interaction between a teacher and student.

(E) A description of the specific responsibilities of the student's family and the school district with respect to equipment, materials, phone and Internet service, and any other requirements applicable to the home or other location outside of a school building necessary for the delivery of the remote educational program.

(F) If applicable, a description of how the remote educational program will be delivered in a manner consistent with the student's individualized education program required by Section 614(d) of the federal Individuals with Disabilities Education Improvement Act of 2004 or plan to ensure compliance with Section 504 of the federal Rehabilitation Act of 1973.

(G) A description of the procedures and opportunities for participation in academic and extra-curricular activities and programs within the school district.

(H) The identification of a parent, guardian, or other responsible adult who will provide direct supervision of the program. The plan must include an acknowledgment by the parent, guardian, or other responsible adult that he or she may engage only in non-teaching duties not requiring instructional judgment or the evaluation of a student. The plan shall designate the parent, guardian, or other responsible adult as non-teaching personnel or volunteer personnel under subsection (a) of Section 10-22.34 of this Code.

(I) The identification of a school district administrator who will oversee the remote educational program on behalf of the school district and who may be contacted by the student's parents with respect to any issues or concerns with the program.

(J) The term of the student's participation in the remote educational program, which may not extend for longer than 12 months, unless the term is renewed by the district in accordance with subdivision (7) of this subsection (a).

(K) A description of the specific location or locations in which the program will be delivered. If the remote educational program is to be delivered to a student in any location other than the student's home, the plan must include a written determination by the school district that the location will provide a learning environment appropriate for the delivery of the program. The location or locations in which the program will be delivered shall be deemed a long distance teaching reception area under subsection (a) of Section 10-22.34 of this Code.

(L) Certification by the school district that the plan meets all other requirements of this Section.

(6) Students participating in a remote educational program must be enrolled in a school district attendance center pursuant to the school district's enrollment policy or policies. A student participating in a remote educational program must be tested as part of all assessments administered by the school district pursuant to Section 2-3.64 of this Code at the attendance center in which the student is enrolled and in accordance with the attendance center's assessment policies and schedule. The student must be included within all adequate yearly progress and other accountability determinations for the school district and attendance center under State and federal law.

(7) The term of a student's participation in a remote educational program may not extend for longer than 12 months, unless the term is renewed by the school district. The district may only renew a student's participation in a remote educational program following an evaluation of the student's progress in the program, a determination that the student's continuation in the program will best serve the student's individual learning needs, and an amendment to the student's written remote educational plan addressing any changes for the upcoming term of the program.

(b) A school district may, by resolution of its school board, establish a remote educational program.

(c) Clock hours of instruction by students in a remote educational program meeting the requirements of this Section may be claimed by the school district and shall be counted as school work for general State aid purposes in accordance with and subject to the limitations of Section 18-8.05 of this Code or primary State aid purposes in accordance with and subject to the limitations of Section 18-8.15 of this Code.

(d) The impact of remote educational programs on wages, hours, and terms and conditions of employment of educational employees within the school district shall be subject to local collective bargaining agreements.

(e) The use of a home or other location outside of a school building for a remote educational program shall not cause the home or other location to be deemed a public school facility.

(f) A remote educational program may be used, but is not required, for instruction delivered to a student in the home or other location outside of a school building that is not claimed for general State aid purposes under Section 18-8.05 of this Code or primary State aid purposes under Section 18-8.15 of this Code.

(g) School districts that, pursuant to this Section, adopt a policy for a remote educational program must submit to the State Board of Education a copy of the policy and any amendments thereto, as well as data on student participation in a format specified by the State Board of Education. The State Board of Education may perform or contract with an outside entity to perform an evaluation of remote educational programs in this State.

(h) The State Board of Education may adopt any rules necessary to ensure compliance by remote educational programs with the requirements of this Section and other applicable legal requirements.

(Source: P.A. 96-684, eff. 8-25-09; 97-339, eff. 8-12-11.)

(105 ILCS 5/11E-135)

Sec. 11E-135. Incentives. For districts reorganizing under this Article and for a district or districts that annex all of the territory of one or more entire other school districts in accordance with Article 7 of this Code, the following payments shall be made from appropriations made for these purposes:

(a)(1) For a combined school district, as defined in Section 11E-20 of this Code, or for a unit district, as defined in Section 11E-25 of this Code, for its first year of existence, the general State aid and supplemental general State aid calculated under Section 18-8.05 of this Code or the primary State aid and supplemental grants calculated under Section 18-8.15 of this Code, as applicable, shall be computed for the new district and for the previously existing districts for which property is totally included within the new district. If the computation on the basis of the previously existing districts is greater, a supplementary payment equal to the difference shall be made for the first 4 years of existence of the new district.

(2) For a school district that annexes all of the territory of one or more entire other school districts as defined in Article 7 of this Code, for the first year during which the change of boundaries attributable to the annexation becomes effective for all purposes, as determined under Section 7-9 of this Code, the general State aid and supplemental general State aid calculated under Section 18-8.05 of this Code or the primary State aid and supplemental grants calculated under Section 18-8.15 of this Code, as applicable, shall be computed for the annexing district as constituted after the annexation and for the annexing and each annexed district as constituted prior to the annexation; and if the computation on the basis of the annexing and annexed districts as constituted prior to the annexation is greater, then a supplementary payment equal to the difference shall be made for the first 4 years of existence of the annexing school district as constituted upon the annexation.

(3) For 2 or more school districts that annex all of the territory of one or more entire other school districts, as defined in Article 7 of this Code, for the first year during which the change of boundaries attributable to the annexation becomes effective for all purposes, as determined under Section 7-9 of this Code, the general State aid and supplemental general State aid calculated under Section 18-8.05 of this Code or the primary State aid and supplemental grants calculated under Section 18-8.15 of this Code, as applicable, shall be computed for each annexing district as constituted after the annexation and for each annexing and annexed district as constituted prior to the annexation; and if the aggregate of the general State aid and supplemental general State aid or primary State aid and supplemental grants, as applicable, as so computed for the annexing districts as constituted after the annexation is less than the aggregate of the general State aid and supplemental general State aid or primary State aid and supplemental grants, as applicable, as so computed for the annexing and annexed districts, as constituted prior to the annexation, then a supplementary payment equal to the difference shall be made and allocated between or among the annexing districts, as constituted upon the annexation, for the first 4 years of their existence. The total difference payment shall be allocated between or among the annexing districts in the same ratio as the pupil enrollment from that portion of the annexed district or districts that is annexed to each annexing district bears to the total pupil enrollment from the entire annexed district or districts, as such pupil enrollment is determined for the school year last ending prior to the date when the change of boundaries attributable to the annexation becomes effective for all purposes. The amount of the total difference payment and the amount thereof to be allocated to the annexing districts shall be computed by the State Board of Education on the basis of pupil enrollment and other data that shall be certified to the State Board of Education, on forms that it shall provide for that purpose, by the regional superintendent of schools for each educational service region in which the annexing and annexed districts are located.

(4) For a school district conversion, as defined in Section 11E-15 of this Code, or a multi-unit conversion, as defined in subsection (b) of Section 11E-30 of this Code, if in their first year of existence the newly created elementary districts and the newly created high school district, from a school district conversion, or the newly created elementary district or districts and newly created combined high school - unit district, from a multi-unit conversion, qualify for less general State aid under Section 18-8.05 of this Code or primary State aid under Section 18-8.15 of this Code than would have been payable under Section 18-8.05 or 18-8.15, as applicable, for that same year to the previously existing districts, then a supplementary payment equal to that difference shall be made for the first 4 years of existence of the newly created districts. The aggregate amount of each supplementary payment shall be allocated among the newly created districts in the proportion that the deemed pupil enrollment in each district during its first year of existence bears to the actual aggregate pupil enrollment in all of the districts during their first year of existence. For purposes of each allocation:

(A) the deemed pupil enrollment of the newly created high school district from a school district conversion shall be an amount equal to its actual pupil enrollment for its first year of existence multiplied by 1.25;

(B) the deemed pupil enrollment of each newly created elementary district from a school district conversion shall be an amount equal to its actual pupil enrollment for its first year of existence reduced by an amount equal to the product obtained when the amount by which the newly created high school district's deemed pupil enrollment exceeds its actual pupil enrollment for its first year of existence is multiplied by a fraction, the numerator of which is the actual pupil enrollment of the newly created elementary district for its first year of existence and the denominator of which is the actual aggregate pupil enrollment of all of the newly created elementary districts for their first year of existence;

(C) the deemed high school pupil enrollment of the newly created combined high school - unit district from a multi-unit conversion shall be an amount equal to its actual grades 9 through 12 pupil enrollment for its first year of existence multiplied by 1.25; and

(D) the deemed elementary pupil enrollment of each newly created district from a multi-unit conversion shall be an amount equal to each district's actual grade K through 8 pupil enrollment for its first year of existence, reduced by an amount equal to the product obtained when the amount by which the newly created combined high school - unit district's deemed high school pupil enrollment exceeds its actual grade 9 through 12 pupil enrollment for its first year of existence is multiplied by a fraction, the numerator of which is the actual grade K through 8 pupil enrollment of each newly created district for its first year of existence and the denominator of which is the actual aggregate grade K through 8 pupil enrollment of all such newly created districts for their first year of existence.

The aggregate amount of each supplementary payment under this subdivision (4) and the amount thereof to be allocated to the newly created districts shall be computed by the State Board of Education on the basis of pupil enrollment and other data, which shall be certified to the State Board of Education, on forms that it shall provide for that purpose, by the regional superintendent of schools for each educational service region in which the newly created districts are located.

(5) For a partial elementary unit district, as defined in subsection (a) or (c) of Section 11E-30 of this Code, if, in the first year of existence, the newly created partial elementary unit district qualifies for less general State aid and supplemental general State aid under Section 18-8.05 of this Code or less primary State aid and supplemental grants under Section 18-8.15 of this Code, as applicable, than would have been payable under those Sections that Section for that same year to the previously existing districts that formed the partial elementary unit district, then a supplementary payment equal to that difference shall be made to the partial elementary unit district for the first 4 years of existence of that newly created district.

(6) For an elementary opt-in, as described in subsection (d) of Section 11E-30 of this Code, the general State aid or primary State aid difference shall be computed in accordance with paragraph (5) of this subsection (a) as if the elementary opt-in was included in an optional elementary unit district at the optional elementary unit district's original effective date. If the calculation in this paragraph (6) is less than that calculated in paragraph (5) of this subsection (a) at the optional elementary unit district's original effective date, then no adjustments may be made. If the calculation in this paragraph (6) is more than that calculated in paragraph (5) of this subsection (a) at the optional elementary unit district's original effective date, then the excess must be paid as follows:

(A) If the effective date for the elementary opt-in is one year after the effective date for the optional elementary unit district, 100% of the calculated excess shall be paid to the optional elementary unit district in each of the first 4 years after the effective date of the elementary opt-in.

(B) If the effective date for the elementary opt-in is 2 years after the effective date for the optional elementary unit district, 75% of the calculated excess shall be paid to the optional elementary unit district in each of the first 4 years after the effective date of the elementary opt-in.

(C) If the effective date for the elementary opt-in is 3 years after the effective date for the optional elementary unit district, 50% of the calculated excess shall be paid to the optional elementary unit district in each of the first 4 years after the effective date of the elementary opt-in.

(D) If the effective date for the elementary opt-in is 4 years after the effective date for the optional elementary unit district, 25% of the calculated excess shall be paid to the optional elementary unit district in each of the first 4 years after the effective date of the elementary opt-in.

(E) If the effective date for the elementary opt-in is 5 years after the effective date for the optional elementary unit district, the optional elementary unit district is not eligible for any additional incentives due to the elementary opt-in.

(6.5) For a school district that annexes territory detached from another school district whereby the enrollment of the annexing district increases by 90% or more as a result of the annexation, for the first year during which the change of boundaries attributable to the annexation becomes effective for all purposes as determined under Section 7-9 of this Code, the general State aid and supplemental general State aid or primary State aid and supplemental grants, as applicable, calculated under this Section shall be computed for the district gaining territory and the district losing territory as constituted after the annexation and for the same districts as constituted prior to the annexation; and if the aggregate of the general State aid and supplemental general State aid or primary State aid and supplemental grants, as applicable, as so computed for the district gaining territory and the district losing territory as constituted after the annexation is less than the aggregate of the general State aid and supplemental general State aid or primary State aid and supplemental grants, as applicable, as so computed for the district gaining territory and the district losing territory as constituted prior to the annexation, then a supplementary payment shall be made to the annexing district for the first 4 years of existence after the annexation, equal to the difference multiplied by the ratio of student enrollment in the territory detached to the total student enrollment in the district losing territory for the year prior to the effective date of the annexation. The amount of the total difference and the proportion paid to the annexing district shall be computed by the State Board of Education on the basis of pupil enrollment and other data that must be submitted to the State Board of Education in accordance with Section 7-14A of this Code. The changes to this Section made by Public Act 95-707 are intended to be retroactive and applicable to any annexation taking effect on or after July 1, 2004. For annexations that are eligible for payments under this paragraph (6.5) and that are effective on or after July 1, 2004, but before January 11, 2008 (the effective date of Public Act 95-707), the first required yearly payment under this paragraph (6.5) shall be paid in the fiscal year of January 11, 2008 (the effective date of Public Act 95-707). Subsequent required yearly payments shall be paid in subsequent fiscal years until the payment obligation under this paragraph (6.5) is complete.

(7) Claims for financial assistance under this subsection (a) may not be recomputed except as expressly provided under Section 18-8.05 or 18-8.15 of this Code.

(8) Any supplementary payment made under this subsection (a) must be treated as separate from all other payments made pursuant to Section 18-8.05 or 18-8.15 of this Code.

(b)(1) After the formation of a combined school district, as defined in Section 11E-20 of this Code, or a unit district, as defined in Section 11E-25 of this Code, a computation shall be made to determine the difference between the salaries effective in each of the previously existing districts on June 30, prior to the creation of the new district. For the first 4 years after the formation of the new district, a supplementary State aid reimbursement shall be paid to the new district equal to the difference between the sum of the salaries earned by each of the certificated members of the new district, while employed in one of the previously existing districts during the year immediately preceding the formation of the new district, and the sum of the salaries those certificated members would have been paid during the year immediately prior to the formation of the new district if placed on the salary schedule of the previously existing district with the highest salary schedule.

(2) After the territory of one or more school districts is annexed by one or more other school districts as defined in Article 7 of this Code, a computation shall be made to determine the difference between the salaries effective in each annexed district and in the annexing district or districts as they were each constituted on June 30 preceding the date when the change of boundaries attributable to the annexation became effective for all purposes, as determined under Section 7-9 of this Code. For the first 4 years after the annexation, a supplementary State aid reimbursement shall be paid to each annexing district as constituted after the annexation equal to the difference between the sum of the salaries earned by each of the certificated members of the annexing district as constituted after the annexation, while employed in an annexed or annexing district during the year immediately preceding the annexation, and the sum of the salaries those certificated members would have been paid during the immediately preceding year if placed on the salary schedule of whichever of the annexing or annexed districts had the highest salary schedule during the immediately preceding year.

(3) For each new high school district formed under a school district conversion, as defined in Section 11E-15 of this Code, the State shall make a supplementary payment for 4 years equal to the difference between the sum of the salaries earned by each certified member of the new high school district, while employed in one of the previously existing districts, and the sum of the salaries those certified members would have been paid if placed on the salary schedule of the previously existing district with the highest salary schedule.

(4) For each newly created partial elementary unit district, the State shall make a supplementary payment for 4 years equal to the difference between the sum of the salaries earned by each certified member of the newly created partial elementary unit district, while employed in one of the previously existing districts that formed the partial elementary unit district, and the sum of the salaries those certified members would have been paid if placed on the salary schedule of the previously existing district with the highest salary schedule. The salary schedules used in the calculation shall be those in effect in the previously existing districts for the school year prior to the creation of the new partial elementary unit district.

(5) For an elementary district opt-in, as described in subsection (d) of Section 11E-30 of this Code, the salary difference incentive shall be computed in accordance with paragraph (4) of this subsection (b) as if the opted-in elementary district was included in the optional elementary unit district at the optional elementary unit district's original effective date. If the calculation in this paragraph (5) is less than that calculated in paragraph (4) of this subsection (b) at the optional elementary unit district's original effective date, then no adjustments may be made. If the calculation in this paragraph (5) is more than that calculated in paragraph (4) of this subsection (b) at the optional elementary unit district's original effective date, then the excess must be paid as follows:

(A) If the effective date for the elementary opt-in is one year after the effective date for the optional elementary unit district, 100% of the calculated excess shall be paid to the optional elementary unit district in each of the first 4 years after the effective date of the elementary opt-in.

(B) If the effective date for the elementary opt-in is 2 years after the effective date for the optional elementary unit district, 75% of the calculated excess shall be paid to the optional elementary unit district in each of the first 4 years after the effective date of the elementary opt-in.

(C) If the effective date for the elementary opt-in is 3 years after the effective date for the optional elementary unit district, 50% of the calculated excess shall be paid to the optional elementary unit district in each of the first 4 years after the effective date of the elementary opt-in.

(D) If the effective date for the elementary opt-in is 4 years after the effective date for the partial elementary unit district, 25% of the calculated excess shall be paid to the optional elementary unit district in each of the first 4 years after the effective date of the elementary opt-in.

(E) If the effective date for the elementary opt-in is 5 years after the effective date for the optional elementary unit district, the optional elementary unit district is not eligible for any additional incentives due to the elementary opt-in.

(5.5) After the formation of a cooperative high school by 2 or more school districts under Section 10-22.22c of this Code, a computation shall be made to determine the difference between the salaries effective in each of the previously existing high schools on June 30 prior to the formation of the cooperative high school. For the first 4 years after the formation of the cooperative high school, a supplementary State aid reimbursement shall be paid to the cooperative high school equal to the difference between the sum of the salaries earned by each of the certificated members of the cooperative high school while employed in one of the previously existing high schools during the year immediately preceding the formation of the cooperative high school and the sum of the salaries those certificated members would have been paid during the year immediately prior to the formation of the cooperative high school if placed on the salary schedule of the previously existing high school with the highest salary schedule.

(5.10) After the annexation of territory detached from another school district whereby the enrollment of the annexing district increases by 90% or more as a result of the annexation, a computation shall be made to determine the difference between the salaries effective in the district gaining territory and the district losing territory as they each were constituted on June 30 preceding the date when the change of boundaries attributable to the annexation became effective for all purposes as determined under Section 7-9 of this Code. For the first 4 years after the annexation, a supplementary State aid reimbursement shall be paid to the annexing district equal to the difference between the sum of the salaries earned by each of the certificated members of the annexing district as constituted after the annexation while employed in the district gaining territory or the district losing territory during the year immediately preceding the annexation and the sum of the salaries those certificated members would have been paid during such immediately preceding year if placed on the salary schedule of whichever of the district gaining territory or district losing territory had the highest salary schedule during the immediately preceding year. To be eligible for supplementary State aid reimbursement under this Section, the intergovernmental agreement to be submitted pursuant to Section 7-14A of this Code must show that staff members were transferred from the control of the district losing territory to the control of the district gaining territory in the annexation. The changes to this Section made by Public Act 95-707 are intended to be retroactive and applicable to any annexation taking effect on or after July 1, 2004. For annexations that are eligible for payments under this paragraph (5.10) and that are effective on or after July 1, 2004, but before January 11, 2008 (the effective date of Public Act 95-707), the first required yearly payment under this paragraph (5.10) shall be paid in the fiscal year of January 11, 2008 (the effective date of Public Act 95-707). Subsequent required yearly payments shall be paid in subsequent fiscal years until the payment obligation under this paragraph (5.10) is complete.

(5.15) After the deactivation of a school facility in accordance with Section 10-22.22b of this Code, a computation shall be made to determine the difference between the salaries effective in the sending school district and each receiving school district on June 30 prior to the deactivation of the school facility. For the lesser of the first 4 years after the deactivation of the school facility or the length of the deactivation agreement, including any renewals of the original deactivation agreement, a supplementary State aid reimbursement shall be paid to each receiving district equal to the difference between the sum of the salaries earned by each of the certificated members transferred to that receiving district as a result of the deactivation while employed in the sending district during the year immediately preceding the deactivation and the sum of the salaries those certificated members would have been paid during the year immediately preceding the deactivation if placed on the salary schedule of the sending or receiving district with the highest salary schedule.

(6) The supplementary State aid reimbursement under this subsection (b) shall be treated as separate from all other payments made pursuant to Section 18-8.05 of this Code. In the case of the formation of a new district or cooperative high school or a deactivation, reimbursement shall begin during the first year of operation of the new district or cooperative high school or the first year of the deactivation, and in the case of an annexation of the territory of one or more school districts by one or more other school districts or the annexation of territory detached from a school district whereby the enrollment of the annexing district increases by 90% or more as a result of the annexation, reimbursement shall begin during the first year when the change in boundaries attributable to the annexation becomes effective for all purposes as determined pursuant to Section 7-9 of this Code, except that for an annexation of territory detached from a school district that is effective on or after July 1, 2004, but before January 11, 2008 (the effective date of Public Act 95-707), whereby the enrollment of the annexing district increases by 90% or more as a result of the annexation, reimbursement shall begin during the fiscal year of January 11, 2008 (the effective date of Public Act 95-707). Each year that the new, annexing, or receiving district or cooperative high school, as the case may be, is entitled to receive reimbursement, the number of eligible certified members who are employed on October 1 in the district or cooperative high school shall be certified to the State Board of Education on prescribed forms by October 15 and payment shall be made on or before November 15 of that year.

(c)(1) For the first year after the formation of a combined school district, as defined in Section 11E-20 of this Code or a unit district, as defined in Section 11E-25 of this Code, a computation shall be made totaling each previously existing district's audited fund balances in the educational fund, working cash fund, operations and maintenance fund, and transportation fund for the year ending June 30 prior to the referendum for the creation of the new district. The new district shall be paid supplementary State aid equal to the sum of the differences between the deficit of the previously existing district with the smallest deficit and the deficits of each of the other previously existing districts.

(2) For the first year after the annexation of all of the territory of one or more entire school districts by another school district, as defined in Article 7 of this Code, computations shall be made, for the year ending June 30 prior to the date that the change of boundaries attributable to the annexation is allowed by the affirmative decision issued by the regional board of school trustees under Section 7-6 of this Code, notwithstanding any effort to seek administrative review of the decision, totaling the annexing district's and totaling each annexed district's audited fund balances in their respective educational, working cash, operations and maintenance, and transportation funds. The annexing district as constituted after the annexation shall be paid supplementary State aid equal to the sum of the differences between the deficit of whichever of the annexing or annexed districts as constituted prior to the annexation had the smallest deficit and the deficits of each of the other districts as constituted prior to the annexation.

(3) For the first year after the annexation of all of the territory of one or more entire school districts by 2 or more other school districts, as defined by Article 7 of this Code, computations shall be made, for the year ending June 30 prior to the date that the change of boundaries attributable to the annexation is allowed by the affirmative decision of the regional board of school trustees under Section 7-6 of this Code, notwithstanding any action for administrative review of the decision, totaling each annexing and annexed district's audited fund balances in their respective educational, working cash, operations and maintenance, and transportation funds. The annexing districts as constituted after the annexation shall be paid supplementary State aid, allocated as provided in this paragraph (3), in an aggregate amount equal to the sum of the differences between the deficit of whichever of the annexing or annexed districts as constituted prior to the annexation had the smallest deficit and the deficits of each of the other districts as constituted prior to the annexation. The aggregate amount of the supplementary State aid payable under this paragraph (3) shall be allocated between or among the annexing districts as follows:

(A) the regional superintendent of schools for each educational service region in which an annexed district is located prior to the annexation shall certify to the State Board of Education, on forms that it shall provide for that purpose, the value of all taxable property in each annexed district, as last equalized or assessed by the Department of Revenue prior to the annexation, and the equalized assessed value of each part of the annexed district that was annexed to or included as a part of an annexing district;

(B) using equalized assessed values as certified by the regional superintendent of schools under clause (A) of this paragraph (3), the combined audited fund balance deficit of each annexed district as determined under this Section shall be apportioned between or among the annexing districts in the same ratio as the equalized assessed value of that part of the annexed district that was annexed to or included as a part of an annexing district bears to the total equalized assessed value of the annexed district; and

(C) the aggregate supplementary State aid payment under this paragraph (3) shall be allocated between or among, and shall be paid to, the annexing districts in the same ratio as the sum of the combined audited fund balance deficit of each annexing district as constituted prior to the annexation, plus all combined audited fund balance deficit amounts apportioned to that annexing district under clause (B) of this subsection, bears to the aggregate of the combined audited fund balance deficits of all of the annexing and annexed districts as constituted prior to the annexation.

(4) For the new elementary districts and new high school district formed through a school district conversion, as defined in Section 11E-15 of this Code or the new elementary district or districts and new combined high school - unit district formed through a multi-unit conversion, as defined in subsection (b) of Section 11E-30 of this Code, a computation shall be made totaling each previously existing district's audited fund balances in the educational fund, working cash fund, operations and maintenance fund, and transportation fund for the year ending June 30 prior to the referendum establishing the new districts. In the first year of the new districts, the State shall make a one-time supplementary payment equal to the sum of the differences between the deficit of the previously existing district with the smallest deficit and the deficits of each of the other previously existing districts. A district with a combined balance among the 4 funds that is positive shall be considered to have a deficit of zero. The supplementary payment shall be allocated among the newly formed high school and elementary districts in the manner provided by the petition for the formation of the districts, in the form in which the petition is approved by the regional superintendent of schools or State Superintendent of Education under Section 11E-50 of this Code.

(5) For each newly created partial elementary unit district, as defined in subsection (a) or (c) of Section 11E-30 of this Code, a computation shall be made totaling the audited fund balances of each previously existing district that formed the new partial elementary unit district in the educational fund, working cash fund, operations and maintenance fund, and transportation fund for the year ending June 30 prior to the referendum for the formation of the partial elementary unit district. In the first year of the new partial elementary unit district, the State shall make a one-time supplementary payment to the new district equal to the sum of the differences between the deficit of the previously existing district with the smallest deficit and the deficits of each of the other previously existing districts. A district with a combined balance among the 4 funds that is positive shall be considered to have a deficit of zero.

(6) For an elementary opt-in as defined in subsection (d) of Section 11E-30 of this Code, the deficit fund balance incentive shall be computed in accordance with paragraph (5) of this subsection (c) as if the opted-in elementary was included in the optional elementary unit district at the optional elementary unit district's original effective date. If the calculation in this paragraph (6) is less than that calculated in paragraph (5) of this subsection (c) at the optional elementary unit district's original effective date, then no adjustments may be made. If the calculation in this paragraph (6) is more than that calculated in paragraph (5) of this subsection (c) at the optional elementary unit district's original effective date, then the excess must be paid as follows:

(A) If the effective date for the elementary opt-in is one year after the effective date for the optional elementary unit district, 100% of the calculated excess shall be paid to the optional elementary unit district in the first year after the effective date of the elementary opt-in.

(B) If the effective date for the elementary opt-in is 2 years after the effective date for the optional elementary unit district, 75% of the calculated excess shall be paid to the optional elementary unit district in the first year after the effective date of the elementary opt-in.

(C) If the effective date for the elementary opt-in is 3 years after the effective date for the optional elementary unit district, 50% of the calculated excess shall be paid to the optional elementary unit district in the first year after the effective date of the elementary opt-in.

(D) If the effective date for the elementary opt-in is 4 years after the effective date for the optional elementary unit district, 25% of the calculated excess shall be paid to the optional elementary unit district in the first year after the effective date of the elementary opt-in.

(E) If the effective date for the elementary opt-in is 5 years after the effective date for the optional elementary unit district, the optional elementary unit district is not eligible for any additional incentives due to the elementary opt-in.

(6.5) For the first year after the annexation of territory detached from another school district whereby the enrollment of the annexing district increases by 90% or more as a result of the annexation, a computation shall be made totaling the audited fund balances of the district gaining territory and the audited fund balances of the district losing territory in the educational fund, working cash fund, operations and maintenance fund, and transportation fund for the year ending June 30 prior to the date that the change of boundaries attributable to the annexation is allowed by the affirmative decision of the regional board of school trustees under Section 7-6 of this Code, notwithstanding any action for administrative review of the decision. The annexing district as constituted after the annexation shall be paid supplementary State aid equal to the difference between the deficit of whichever district included in this calculation as constituted prior to the annexation had the smallest deficit and the deficit of each other district included in this calculation as constituted prior to the annexation, multiplied by the ratio of equalized assessed value of the territory detached to the total equalized assessed value of the district losing territory. The regional superintendent of schools for the educational service region in which a district losing territory is located prior to the annexation shall certify to the State Board of Education the value of all taxable property in the district losing territory and the value of all taxable property in the territory being detached, as last equalized or assessed by the Department of Revenue prior to the annexation. To be eligible for supplementary State aid reimbursement under this Section, the intergovernmental agreement to be submitted pursuant to Section 7-14A of this Code must show that fund balances were transferred from the district losing territory to the district gaining territory in the annexation. The changes to this Section made by Public Act 95-707 are intended to be retroactive and applicable to any annexation taking effect on or after July 1, 2004. For annexations that are eligible for payments under this paragraph (6.5) and that are effective on or after July 1, 2004, but before January 11, 2008 (the effective date of Public Act 95-707), the required payment under this paragraph (6.5) shall be paid in the fiscal year of January 11, 2008 (the effective date of Public Act 95-707).

(7) For purposes of any calculation required under paragraph (1), (2), (3), (4), (5), (6), or (6.5) of this subsection (c), a district with a combined fund balance that is positive shall be considered to have a deficit of zero. For purposes of determining each district's audited fund balances in its educational fund, working cash fund, operations and maintenance fund, and transportation fund for the specified year ending June 30, as provided in paragraphs (1), (2), (3), (4), (5), (6), and (6.5) of this subsection (c), the balance of each fund shall be deemed decreased by an amount equal to the amount of the annual property tax theretofore levied in the fund by the district for collection and payment to the district during the calendar year in which the June 30 fell, but only to the extent that the tax so levied in the fund actually was received by the district on or before or comprised a part of the fund on such June 30. For purposes of determining each district's audited fund balances, a calculation shall be made for each fund to determine the average for the 3 years prior to the specified year ending June 30, as provided in paragraphs (1), (2), (3), (4), (5), (6), and (6.5) of this subsection (c), of the district's expenditures in the categories "purchased services", "supplies and materials", and "capital outlay", as those categories are defined in rules of the State Board of Education. If this 3-year average is less than the district's expenditures in these categories for the specified year ending June 30, as provided in paragraphs (1), (2), (3), (4), (5), (6), and (6.5) of this subsection (c), then the 3-year average shall be used in calculating the amounts payable under this Section in place of the amounts shown in these categories for the specified year ending June 30, as provided in paragraphs (1), (2), (3), (4), (5), (6), and (6.5) of this subsection (c). Any deficit because of State aid not yet received may not be considered in determining the June 30 deficits. The same basis of accounting shall be used by all previously existing districts and by all annexing or annexed districts, as constituted prior to the annexation, in making any computation required under paragraphs (1), (2), (3), (4), (5), (6), and (6.5) of this subsection (c).

(8) The supplementary State aid payments under this subsection (c) shall be treated as separate from all other payments made pursuant to Section 18-8.05 of this Code.

(d)(1) Following the formation of a combined school district, as defined in Section 11E-20 of this Code, a new unit district, as defined in Section 11E-25 of this Code, a new elementary district or districts and a new high school district formed through a school district conversion, as defined in Section 11E-15 of this Code, a new partial elementary unit district, as defined in Section 11E-30 of this Code, or a new elementary district or districts formed through a multi-unit conversion, as defined in subsection (b) of Section 11E-30 of this Code, or the annexation of all of the territory of one or more entire school districts by one or more other school districts, as defined in Article 7 of this Code, a supplementary State aid reimbursement shall be paid for the number of school years determined under the following table to each new or annexing district equal to the sum of $4,000 for each certified employee who is employed by the district on a full-time basis for the regular term of the school year:

The State Board of Education shall make a one-time calculation of a reorganized district's quintile ranks. The average daily attendance used in this calculation shall be the best 3 months' average daily attendance for the district's first year. The equalized assessed value per pupil shall be the district's real property equalized assessed value used in calculating the district's first-year general State aid claim, under Section 18-8.05 of this Code, or first-year primary State aid claim, under Section 18-8.15 of this Code, as applicable, divided by the best 3 months' average daily attendance.

No annexing or resulting school district shall be entitled to supplementary State aid under this subsection (d) unless the district acquires at least 30% of the average daily attendance of the district from which the territory is being detached or divided.

If a district results from multiple reorganizations that would otherwise qualify the district for multiple payments under this subsection (d) in any year, then the district shall receive a single payment only for that year based solely on the most recent reorganization.

(2) For an elementary opt-in, as defined in subsection (d) of Section 11E-30 of this Code, the full-time certified staff incentive shall be computed in accordance with paragraph (1) of this subsection (d), equal to the sum of $4,000 for each certified employee of the elementary district that opts-in who is employed by the optional elementary unit district on a full-time basis for the regular term of the school year. The calculation from this paragraph (2) must be paid as follows:

(A) If the effective date for the elementary opt-in is one year after the effective date for the optional elementary unit district, 100% of the amount calculated in this paragraph (2) shall be paid to the optional elementary unit district for the number of years calculated in paragraph (1) of this subsection (d) at the optional elementary unit district's original effective date, starting in the second year after the effective date of the elementary opt-in.

(B) If the effective date for the elementary opt-in is 2 years after the effective date for the optional elementary unit district, 75% of the amount calculated in this paragraph (2) shall be paid to the optional elementary unit district for the number of years calculated in paragraph (1) of this subsection (d) at the optional elementary unit district's original effective date, starting in the second year after the effective date of the elementary opt-in.

(C) If the effective date for the elementary opt-in is 3 years after the effective date for the optional elementary unit district, 50% of the amount calculated in this paragraph (2) shall be paid to the optional elementary unit district for the number of years calculated in paragraph (1) of this subsection (d) at the optional elementary unit district's original effective date, starting in the second year after the effective date of the elementary opt-in.

(D) If the effective date for the elementary opt-in is 4 years after the effective date for the optional elementary unit district, 25% of the amount calculated in this paragraph (2) shall be paid to the optional elementary unit district for the number of years calculated in paragraph (1) of this subsection (d) at the optional elementary unit district's original effective date, starting in the second year after the effective date of the elementary opt-in.

(E) If the effective date for the elementary opt-in is 5 years after the effective date for the optional elementary unit district, the optional elementary unit district is not eligible for any additional incentives due to the elementary opt-in.

(2.5) Following the formation of a cooperative high school by 2 or more school districts under Section 10-22.22c of this Code, a supplementary State aid reimbursement shall be paid for 3 school years to the cooperative high school equal to the sum of $4,000 for each certified employee who is employed by the cooperative high school on a full-time basis for the regular term of any such school year. If a cooperative high school results from multiple agreements that would otherwise qualify the cooperative high school for multiple payments under this Section in any year, the cooperative high school shall receive a single payment for that year based solely on the most recent agreement.

(2.10) Following the annexation of territory detached from another school district whereby the enrollment of the annexing district increases 90% or more as a result of the annexation, a supplementary State aid reimbursement shall be paid to the annexing district equal to the sum of $4,000 for each certified employee who is employed by the annexing district on a full-time basis and shall be calculated in accordance with subsection (a) of this Section. To be eligible for supplementary State aid reimbursement under this Section, the intergovernmental agreement to be submitted pursuant to Section 7-14A of this Code must show that certified staff members were transferred from the control of the district losing territory to the control of the district gaining territory in the annexation. The changes to this Section made by Public Act 95-707 are intended to be retroactive and applicable to any annexation taking effect on or after July 1, 2004. For annexations that are eligible for payments under this paragraph (2.10) and that are effective on or after July 1, 2004, but before January 11, 2008 (the effective date of Public Act 95-707), the first required yearly payment under this paragraph (2.10) shall be paid in the second fiscal year after January 11, 2008 (the effective date of Public Act 95-707). Any subsequent required yearly payments shall be paid in subsequent fiscal years until the payment obligation under this paragraph (2.10) is complete.

(2.15) Following the deactivation of a school facility in accordance with Section 10-22.22b of this Code, a supplementary State aid reimbursement shall be paid for the lesser of 3 school years or the length of the deactivation agreement, including any renewals of the original deactivation agreement, to each receiving school district equal to the sum of $4,000 for each certified employee who is employed by that receiving district on a full-time basis for the regular term of any such school year who was originally transferred to the control of that receiving district as a result of the deactivation. Receiving districts are eligible for payments under this paragraph (2.15) based on the certified employees transferred to that receiving district as a result of the deactivation and are not required to receive at least 30% of the deactivating district's average daily attendance as required under paragraph (1) of this subsection (d) to be eligible for payments.

(3) The supplementary State aid reimbursement payable under this subsection (d) shall be separate from and in addition to all other payments made to the district pursuant to any other Section of this Article.

(4) During May of each school year for which a supplementary State aid reimbursement is to be paid to a new, annexing, or receiving school district or cooperative high school pursuant to this subsection (d), the school board or governing board shall certify to the State Board of Education, on forms furnished to the school board or governing board by the State Board of Education for purposes of this subsection (d), the number of certified employees for which the district or cooperative high school is entitled to reimbursement under this Section, together with the names, certificate numbers, and positions held by the certified employees.

(5) Upon certification by the State Board of Education to the State Comptroller of the amount of the supplementary State aid reimbursement to which a school district or cooperative high school is entitled under this subsection (d), the State Comptroller shall draw his or her warrant upon the State Treasurer for the payment thereof to the school district or cooperative high school and shall promptly transmit the payment to the school district or cooperative high school through the appropriate school treasurer.

(Source: P.A. 95-331, eff. 8-21-07; 95-707, eff. 1-11-08; 95-903, eff. 8-25-08; 96-328, eff. 8-11-09.)

(105 ILCS 5/13A-8)

Sec. 13A-8. Funding.

(a) The State of Illinois shall provide funding for the alternative school programs within each educational service region and within the Chicago public school system by line item appropriation made to the State Board of Education for that purpose. This money, when appropriated, shall be provided to the regional superintendent and to the Chicago Board of Education, who shall establish a budget, including salaries, for their alternative school programs. Each program shall receive funding in the amount of $30,000 plus an amount based on the ratio of the region's or Chicago's best 3 months' average daily attendance in grades pre-kindergarten through 12 to the statewide totals of these amounts. For purposes of this calculation, the best 3 months' average daily attendance for each region or Chicago shall be calculated by adding to the best 3 months' average daily attendance the number of low-income students identified in the most recently available federal census multiplied by one-half times the percentage of the region's or Chicago's low-income students to the State's total low-income students. The State Board of Education shall retain up to 1.1% of the appropriation to be used to provide technical assistance, professional development, and evaluations for the programs.

(a-5) Notwithstanding any other provisions of this Section, for the 1998-1999 fiscal year, the total amount distributed under subsection (a) for an alternative school program shall be not less than the total amount that was distributed under that subsection for that alternative school program for the 1997-1998 fiscal year. If an alternative school program is to receive a total distribution under subsection (a) for the 1998-1999 fiscal year that is less than the total distribution that the program received under that subsection for the 1997-1998 fiscal year, that alternative school program shall also receive, from a separate appropriation made for purposes of this subsection (a-5), a supplementary payment equal to the amount by which its total distribution under subsection (a) for the 1997-1998 fiscal year exceeds the amount of the total distribution that the alternative school program receives under that subsection for the 1998-1999 fiscal year. If the amount appropriated for supplementary payments to alternative school programs under this subsection (a-5) is insufficient for that purpose, those supplementary payments shall be prorated among the alternative school programs entitled to receive those supplementary payments according to the aggregate amount of the appropriation made for purposes of this subsection (a-5).

(b) An alternative school program shall be entitled to receive general State aid as calculated in subsection (K) of Section 18-8.05 or primary State aid as calculated in subsection (i) of Section 18-8.15 upon filing a claim as provided therein. Any time that a student who is enrolled in an alternative school program spends in work-based learning, community service, or a similar alternative educational setting shall be included in determining the student's minimum number of clock hours of daily school work that constitute a day of attendance for purposes of calculating general State aid or primary State aid.

(c) An alternative school program may receive additional funding from its school districts in such amount as may be agreed upon by the parties and necessary to support the program. In addition, an alternative school program is authorized to accept and expend gifts, legacies, and grants, including but not limited to federal grants, from any source for purposes directly related to the conduct and operation of the program.

(Source: P.A. 89-383, eff. 8-18-95; 89-629, eff. 8-9-96; 89-636, eff. 8-9-96; 90-14, eff. 7-1-97; 90-283, eff. 7-31-97; 90-802, eff. 12-15-98.)

(105 ILCS 5/13B-20.20)

Sec. 13B-20.20. Enrollment in other programs. General Educational Development preparation programs are not eligible for funding under this Article. A student may enroll in a program approved under Section 18-8.05 or 18-8.15 of this Code, as appropriate, or attend both the alternative learning opportunities program and the regular school program to enhance student performance and facilitate on-time graduation.

(Source: P.A. 92-42, eff. 1-1-02.)

(105 ILCS 5/13B-45)

Sec. 13B-45. Days and hours of attendance. An alternative learning opportunities program shall provide students with at least the minimum number of days of pupil attendance required under Section 10-19 of this Code and the minimum number of daily hours of school work required under Section 18-8.05 or 18-8.15 of this Code, provided that the State Board may approve exceptions to these requirements if the program meets all of the following conditions:

(1) The district plan submitted under Section 13B-25.15 of this Code establishes that a program providing the required minimum number of days of attendance or daily hours of school work would not serve the needs of the program's students.

(2) Each day of attendance shall provide no fewer than 3 clock hours of school work, as defined under paragraph (1) of subsection (F) of Section 18-8.05 or subsection (f) of Section 18-8.15 of this Code.

(3) Each day of attendance that provides fewer than 5 clock hours of school work shall also provide supplementary services, including without limitation work-based learning, student assistance programs, counseling, case management, health and fitness programs, or life-skills or conflict resolution training, in order to provide a total daily program to the student of 5 clock hours. A program may claim general State aid or primary State aid for up to 2 hours of the time each day that a student is receiving supplementary services.

(4) Each program shall provide no fewer than 174 days of actual pupil attendance during the school term; however, approved evening programs that meet the requirements of Section 13B-45 of this Code may offer less than 174 days of actual pupil attendance during the school term.

(Source: P.A. 92-42, eff. 1-1-02.)

(105 ILCS 5/13B-50)

Sec. 13B-50. Eligibility to receive general State aid or primary State aid. In order to receive general State aid or primary State aid, alternative learning opportunities programs must meet the requirements for claiming general State aid as specified in Section 18-8.05 of this Code or primary State aid as specified in Section 18-8.15 of this Code, as applicable, with the exception of the length of the instructional day, which may be less than 5 hours of school work if the program meets the criteria set forth under Sections 13B-50.5 and 13B-50.10 of this Code and if the program is approved by the State Board.

(Source: P.A. 92-42, eff. 1-1-02.)

(105 ILCS 5/13B-50.10)

Sec. 13B-50.10. Additional criteria for general State aid or primary State aid. In order to claim general State aid or primary State aid, an alternative learning opportunities program must meet the following criteria:

(1) Teacher professional development plans should include education in the instruction of at-risk students.

(2) Facilities must meet the health, life, and safety requirements in this Code.

(3) The program must comply with all other State and federal laws applicable to education providers.

(Source: P.A. 92-42, eff. 1-1-02.)

(105 ILCS 5/13B-50.15)

Sec. 13B-50.15. Level of funding. Approved alternative learning opportunities programs are entitled to claim general State aid or primary State aid, subject to Sections 13B-50, 13B-50.5, and 13B-50.10 of this Code. Approved programs operated by regional offices of education are entitled to receive general State aid or primary State aid at the foundation level of support. A school district or consortium must ensure that an approved program receives supplemental general State aid, transportation reimbursements, and special education resources, if appropriate, for students enrolled in the program.

(Source: P.A. 92-42, eff. 1-1-02.)

(105 ILCS 5/14-7.02) (from Ch. 122, par. 14-7.02)

Sec. 14-7.02. Children attending private schools, public out-of-state schools, public school residential facilities or nonpublic private special education facilities. The General Assembly recognizes that nonpublic non-public schools or special education facilities provide an important service in the educational system in Illinois.

If because of his or her disability the special education program of a district is unable to meet the needs of a child