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20 ILCS 405/405-300
(20 ILCS 405/405-300)
(was 20 ILCS 405/67.02)
Lease or purchase of facilities; training programs.
(a) To lease or purchase office and storage space,
buildings, land, and other
facilities for all State agencies, authorities, boards, commissions,
departments, institutions, and bodies politic and all other administrative
units or outgrowths of the executive branch of State government except the
Constitutional officers, the State Board of Education and the State
colleges and universities and their governing bodies. However, before
leasing or purchasing any office or storage space, buildings, land
or other facilities in any municipality the Department shall survey the
existing State-owned and State-leased property
to make a determination of need.
The leases shall be for
a term not to exceed 5 years, except that the leases
may contain a renewal clause subject to acceptance by the State after
that date or an option to purchase. The purchases shall be made
contracts that (i) may provide for the title to the property to
immediately to the State or a trustee or nominee for the benefit of the
State, (ii) shall provide for the consideration to be
paid in installments to
be made at stated intervals during a certain term not to exceed 30 years
from the date of the contract, and (iii) may provide for the
payment of interest on the unpaid balance at a rate that does not exceed
a rate determined by adding 3 percentage points to the annual yield on
United States Treasury
obligations of comparable maturity as most recently published in the Wall
Street Journal at the time such contract is signed. The leases and
contracts shall be and shall recite
that they are subject to termination and cancellation in any year for which
the General Assembly fails to make an appropriation to pay the rent or
purchase installments payable
under the terms of the lease or purchase contract.
Additionally, the purchase contract shall specify that title to
and storage space, buildings, land, and other facilities being acquired
the contract shall revert to the Seller in the event of the
of the General Assembly to appropriate suitable funds.
However, this limitation on the
term of the leases does not apply to leases to and with the
Building Authority, as provided for in the Building Authority Act. Leases to and with that Authority may be
entered into for a term not to exceed 30 years and shall be and shall
recite that they are subject to termination and cancellation in any year
for which the General Assembly fails to make an appropriation to pay the
rent payable under the terms of the lease. These limitations do
apply if the lease or purchase contract contains a provision
limiting the liability for
the payment of the rentals or installments thereof solely to funds
received from the Federal government.
(b) To lease from an airport authority office, aircraft hangar, and
service buildings constructed upon a public airport under the Airport
Authorities Act for the use and occupancy of the State Department of
Transportation. The lease may be entered into for a term not
(c) To establish training programs for teaching State leasing procedures
and practices to new employees of the Department and to keep all employees
of the Department informed about current leasing practices and developments
in the real estate industry.
(d) To enter into an agreement with a municipality or county to
construct, remodel, or convert a structure for the purposes of its serving
as a correctional institution or facility pursuant to paragraph (c) of
Section 3-2-2 of the Unified Code of Corrections.
(e) To enter into an agreement with a private individual,
or corporation or a municipality or other unit of local government, when
authorized to do so by the Department of Corrections,
whereby that individual, trust, partnership, or corporation or
municipality or other unit of local government will construct, remodel,
or convert a structure for the purposes of its serving as a correctional
institution or facility and then lease the structure to the
for the use of the Department of Corrections. A lease entered into pursuant
to the authority granted in this
subsection shall be for a
term not to exceed 30 years but may grant to the State the
option to purchase the structure outright.
The leases shall be and shall recite that they are subject to
termination and cancellation in any year for which the General Assembly
fails to make an appropriation to pay the rent payable under the terms of the
(f) On and after September 17, 1983, the powers granted to
the Department under this Section shall be exercised exclusively by the
Department, and no other State agency may concurrently exercise any such
power unless specifically authorized otherwise by a later enacted law.
This subsection is not intended to impair any contract existing as of
September 17, 1983.
However, no lease for more than 10,000 square feet of space shall be executed
unless the Director, in consultation with the Executive Director of the
Development Board, has certified that leasing is in the best interest of
the State, considering programmatic requirements, availability of vacant
State-owned space, the cost-benefits of purchasing or constructing new
and other criteria as he or she shall determine. The Director shall not
multiple leases for less than 10,000 square feet to be executed in order
to evade this provision.
(g) To develop and implement, in cooperation with the Interagency
Energy Conservation Committee, a system for evaluating energy consumption in
facilities leased by the Department, and to develop energy consumption
standards for use in evaluating prospective lease sites.
(h) (1) After June 1, 1998 (the effective date of Public
Act 90-520), the Department shall not enter into an agreement for the installment purchase or lease purchase of buildings, land, or facilities unless:
(A) the using agency certifies to the Department
that the agency reasonably expects that the building, land, or facilities being considered for purchase will meet a permanent space need;
(B) the building or facilities will be
substantially occupied by State agencies after purchase (or after acceptance in the case of a build to suit);
(C) the building or facilities shall be in new or
like new condition and have a remaining economic life exceeding the term of the contract;
(D) no structural or other major building
component or system has a remaining economic life of less than 10 years;
(E) the building, land, or facilities:
(i) is free of any identifiable environmental
(ii) is subject to a management plan,
provided by the seller and acceptable to the State, to address the known environmental hazard;
(F) the building, land, or facilities satisfy
applicable accessibility and applicable building codes; and
(G) the State's cost to lease purchase or
installment purchase the building, land, or facilities is less than the cost to lease space of comparable quality, size, and location over the lease purchase or installment purchase term.
(2) The Department shall establish the methodology
for comparing lease costs to the costs of installment or lease purchases. The cost comparison shall take into account all relevant cost factors, including, but not limited to, debt service, operating and maintenance costs, insurance and risk costs, real estate taxes, reserves for replacement and repairs, security costs, and utilities. The methodology shall also provide:
(A) that the comparison will be made using level
(B) that a purchase price must not exceed the
fair market value of the buildings, land, or facilities and that the purchase price must be substantiated by an appraisal or by a competitive selection process.
(3) If the Department intends to enter into an
installment purchase or lease purchase agreement for buildings, land, or facilities under circumstances that do not satisfy the conditions specified by this Section, it must issue a notice to the Secretary of the Senate and the Clerk of the House. The notice shall contain (i) specific details of the State's proposed purchase, including the amounts, purposes, and financing terms; (ii) a specific description of how the proposed purchase varies from the procedures set forth in this Section; and (iii) a specific justification, signed by the Director, stating why it is in the State's best interests to proceed with the purchase. The Department may not proceed with such an installment purchase or lease purchase agreement if, within 60 calendar days after delivery of the notice, the General Assembly, by joint resolution, disapproves the transaction. Delivery may take place on a day and at an hour when the Senate and House are not in session so long as the offices of Secretary and Clerk are open to receive the notice. In determining the 60-day period within which the General Assembly must act, the day on which delivery is made to the Senate and House shall not be counted. If delivery of the notice to the 2 houses occurs on different days, the 60-day period shall begin on the day following the later delivery.
(4) On or before February 15 of each year, the
Department shall submit an annual report to the Director of the Governor's Office of Management and Budget and the General Assembly regarding installment purchases or lease purchases of buildings, land, or facilities that were entered into during the preceding calendar year. The report shall include a summary statement of the aggregate amount of the State's obligations under those purchases; specific details pertaining to each purchase, including the amounts, purposes, and financing terms and payment schedule for each purchase; and any other matter that the Department deems advisable. The report shall also contain an analysis of all leases that meet both of the following criteria: (1) the lease contains a purchase option clause; and (2) the third full year of the lease has been completed. That analysis shall include, without limitation, a recommendation of whether it is in the State's best interest to exercise the purchase option or to seek to renew the lease without exercising the clause.
The requirement for reporting shall be satisfied by
filing copies of the report with each of the following: (1) the Auditor General; (2) the Chairs of the Appropriations Committees; (3) the General Assembly and the Commission on Government Forecasting and Accountability as required by Section 3.1 of the General Assembly Organizations Act; and (4) the State Government Report Distribution Center for the General Assembly as is required under paragraph (t) of Section 7 of the State Library Act.
(Source: P.A. 99-143, eff. 7-27-15; 100-1109, eff. 1-1-19; 100-1148, eff. 12-10-18.)