65 ILCS 5/ Illinois Municipal Code.

(65 ILCS 5/11-119.2-4) (from Ch. 24, par. 11-119.2-4)

Sec. 11-119.2-4. A. Any 2 or more municipalities, contiguous or noncontiguous, and which operate a natural gas plant or system, may form a municipal natural gas agency by the execution of an agency agreement authorized by an ordinance adopted by the governing body of each municipality. The agency agreement may state:

(1) that the municipal natural gas agency is created and incorporated under the provisions of this Division as a body politic and corporate, municipal corporation and unit of local government of the State of Illinois;

(2) the name of the agency and the date of its establishment;

(3) the names of the municipalities which have adopted the agency agreement and constitute the initial members of the municipal natural gas agency;

(4) the names and addresses of the persons initially appointed in the ordinances adopting the agency agreement to serve on the Board of Directors and act as the representatives of the municipalities, respectively, in the exercise of their powers as members;

(5) the limitations, if any, upon the terms of office of the directors, provided that such directors shall always be selected and vacancies in their offices declared and filled by ordinances adopted by the governing body of the respective municipalities;

(6) the location by city, village or incorporated town in the State of Illinois of the principal office of the municipal natural gas agency;

(7) provisions for the disposition, division or distribution of obligations, property and assets of the municipal natural gas agency upon dissolution; and

(8) any other provisions for regulating the business of the municipal natural gas agency or the conduct of its affairs which may be agreed to by the member municipalities, consistent with this Division, including, without limitation, any provisions for weighted voting among the member municipalities or by the directors.

B. The presiding officer of the Board of Directors of any municipal natural gas agency established pursuant to this Division or such other officer selected by the Board of Directors, within 3 months after establishment, shall file a certified copy of the agency agreement and a list of the municipalities which have adopted the agreement with the recorder of the county in which the principal office is located. The recorder shall record this certified copy and list and shall immediately transmit the certified copy and list to the Secretary of State, together with his certificate of recordation. The Secretary of State shall file these documents and issue his certificate of approval over his signature and the Great Seal of the State. The Secretary of State shall make and keep a register of municipal natural gas agencies established under this Division.

C. Each municipality which becomes a member of the municipal natural gas agency shall appoint a representative to serve on the Board of Directors, which representative may be a member of the governing body of the municipality. Each appointment shall be made by the mayor, or president, subject to the confirmation of the governing body. The directors so appointed shall hold office for a term of 3 years, or until a successor has been duly appointed and qualified, except that the directors first appointed shall determine by lot at their initial meeting the respective directors which shall serve for a term of one, 2 or 3 years from the date of that meeting. A vacancy shall be filled for the balance of the unexpired term in the same manner as the original appointment.

The Board of Directors is the corporate authority of the municipal natural gas agency and shall exercise all the powers and manage and control all of the affairs and property of the agency. The Board of Directors shall have full power to pass all necessary ordinances, resolutions, rules and regulations for the proper management and conduct of the business of the board, and for carrying into effect the objects for which the agency was established.

At the initial meeting of the Board of Directors to be held within 30 days after the date of establishment of the municipal natural gas agency, the directors shall elect from their members a presiding officer to preside over the meetings of the Board of Directors and an alternate presiding officer and may elect an executive board. The Board of Directors shall determine and designate in the agency's bylaws the titles for the presiding officers. The directors shall also elect a secretary and treasurer, who need not be directors. The board may select such other officers, employees and agents as deemed to be necessary, who need not be directors or residents of any of the municipalities which are members of the municipal natural gas agency. The board may designate appropriate titles for all other officers, employees, and agents. All persons selected by the board shall hold their respective offices during the pleasure of the board, and give such bond as may be required by the board.

D. The bylaws of the municipal natural gas agency, and any amendments thereto, shall be adopted by the Board of Directors by a majority vote (adjusted for weighted voting, if provided in the Agency Agreement) to provide the following:

(1) the conditions and obligations of membership, if any;

(2) the manner and time of calling regular and special meetings of the Board of Directors;

(3) the procedural rules of the Board of Directors;

(4) the composition, powers and responsibilities of any committee or executive board;

(5) the rights and obligations of new members, and the disposition of rights and obligations upon termination of membership; and

(6) such other rules or provisions for regulating the affairs of the municipal natural gas agency as the board shall determine to be necessary.

E. Every municipal natural gas agency shall maintain an office in the State of Illinois to be known as its principal office. When a municipal natural gas agency desires to change the location of such office, it shall file with the Secretary of State a certificate of change of location, stating the new address and the effective date of change. Meetings of the Board of Directors may be held at any place within the State of Illinois, designated by the Board of Directors, after notice. Unless otherwise provided by the bylaws, an act of the majority of the directors present at a meeting at which a quorum is present is the act of the Board of Directors.

F. The Board of Directors shall hold at least one meeting each year for the election of officers and for the transaction of any other business. Special meetings of the Board of Directors may be called for any purpose upon written request to the presiding officer of the Board of Directors or secretary to call the meeting. Such officer shall give notice of the meeting to be held not less than 10 days and not more than 60 days after receipt of such request. Unless the bylaws provide for a different percentage, a quorum for a meeting of the Board of Directors is a majority of all members then in office. All meetings of the board shall be held in compliance with the provisions of the Open Meetings Act.

G. The agency agreement may be amended as proposed at any meeting of the Board of Directors for which notice, stating the purpose, shall be given to each director and, unless the bylaws prescribe otherwise, such amendment shall become effective when ratified by ordinances adopted by a majority of the governing bodies of the member municipalities. Each amendment, duly certified, shall be recorded and filed in the same manner as for the original agreement.

H. Each member municipality shall have full power and authority, subject to the provisions of its charter and laws regarding local finance, to appropriate money for the payment of the expenses of the municipal natural gas agency and of its representative in exercising its functions as a member of the municipal natural gas agency.

I. Any additional municipality which operates a natural gas plant or system may join the municipal natural gas agency, or any member municipality may withdraw therefrom upon the approval by ordinance adopted by the governing body of the majority of the municipalities which are then members of the municipal natural gas agency. Any new member shall agree to assume its proportionate share of the outstanding obligations of the municipal natural gas agency and any member permitted to withdraw shall remain obligated to make payments under any outstanding contract or agreement with the municipal natural gas agency. Any such change in membership shall be recorded and filed in the same manner as for the original agreement.

J. Any 2 or more municipal natural gas agencies organized pursuant to this Division may consolidate to form a new municipal natural gas agency when approved by ordinance adopted by the governing body of each municipality which is a member of the respective municipal natural gas agency and by the execution of an agency agreement as provided in this Section.

(Source: P.A. 96-204, eff. 1-1-10.)

(65 ILCS 5/11-119.2-5) (from Ch. 24, par. 11-119.2-5)

Sec. 11-119.2-5. A. A municipal natural gas agency shall have all the powers enumerated in this Section in furtherance of the purposes of this Division. In the exercise thereof it shall be deemed to be performing an essential governmental function and exercising a part of the sovereign powers of the State of Illinois, separate and distinct from member municipalities, and shall have the privileges, immunities and rights of a public body politic and corporate, municipal corporation and unit of local government, but shall not have taxing power. All powers of the municipal natural gas agency shall be exercised by its Board of Directors unless otherwise provided by the bylaws.

B. A municipal natural gas agency may plan, finance, acquire, construct, reconstruct, own, lease, operate, maintain, repair, improve, extend or otherwise participate in, individually or jointly with other persons, public agencies, eligible utilities or other entities of any type, one or more projects, proposed, existing or under construction, within or without the State of Illinois, acquire any interest in or any right to products and services of a project, purchase, own, sell, dispose of or otherwise participate in securities issued in connection with the financing of a project or any portion thereof, and may act as agent, or designate one or more persons, public agencies, eligible utilities or other entities of any type, whether or not participating in a project, to act as its agent, in connection with the planning, financing, acquisition, construction, reconstruction, ownership, lease, operation, maintenance, repair, extension or improvement of the project. Any acquisition by eminent domain under this subsection is subject to the provisions of Section 11-119.2-7.

C. A municipal natural gas agency may investigate the desirability of and necessity for additional sources and supplies of natural gas and fuel of any kind for such purpose, and make studies, surveys, and estimates as may be necessary to determine the feasibility and cost thereof.

D. A municipal natural gas agency may cooperate with other persons, public agencies, eligible utilities or other entities of any type in the development of sources and supplies of natural gas and fuel of any kind for such purposes, and give assistance with personnel and equipment in any project.

E. A municipal natural gas agency may apply for consents, authorizations or approvals required for any project within its powers and take all actions necessary to comply with the conditions thereof.

F. A municipal natural gas agency may perform any act authorized by this Division through, or by means of, its officers, agents, or employees or by contract with others, including, without limitation, the employment of engineers, architects, attorneys, appraisers, financial advisors, and such other consultants and employees as may be required in the judgment of the municipal natural gas agency, and fix and pay their compensation from funds available to the municipal natural gas agency therefor.

G. A municipal natural gas agency may, individually or jointly with other persons, public agencies, eligible utilities or other entities of any type, acquire, hold, use, and dispose of income, revenues, funds and money.

H. A municipal natural gas agency may, individually or jointly with other persons, public agencies, eligible utilities or other entities of any type, acquire, own, hire, use, operate and dispose of personal property and any interest therein.

I. A municipal natural gas agency may, individually or jointly with other persons, public agencies, eligible utilities or other entities of any type, acquire, own, use, lease as lessor or lessee, operate and dispose of real property and interests in real property, including projects existing, proposed or under construction, and make improvements thereon.

J. A municipal natural gas agency may grant the use by franchise, lease or otherwise and make charges for the use of any property or facility owned or controlled by it.

K. A municipal natural gas agency may borrow money and issue negotiable bonds, secured or unsecured, in accordance with this Division.

L. A municipal natural gas agency may invest money of the municipal natural gas agency not required for immediate use, including proceeds from the sale of any bonds, in such obligations, securities, and other investments as authorized by the provisions of "An Act relating to certain investments of public funds by public agencies", approved July 23, 1943, as amended.

M. A municipal natural gas agency may exercise the power of eminent domain in accordance with the provisions of Section 11-119.2-7.

N. A municipal natural gas agency may determine the location and character of, and all other matters in connection with, any and all projects it is authorized to acquire, hold, establish, effectuate, operate or control.

O. A municipal natural gas agency may contract with any persons, public agencies, eligible utilities or other entities of any type for the planning, development, construction or operation of any project or for the sale, transmission or distribution of the products and services of any project, or for any interest therein or any right to the products and services thereof, on such terms and for such period of time as its Board of Directors shall determine.

P. A municipal natural gas agency may enter into any contract or agreement necessary, appropriate or incidental to the effectuation of its lawful purposes and the exercise of the powers granted by this Division, including without limitation, contracts or agreements for the purchase, sale, exchange, interchange, wheeling, pooling, transmission, distribution or storage of natural gas and fuel of any kind for any such purposes, within and without the State of Illinois, in such amounts as it shall determine to be necessary and appropriate to make the most effective use of its powers and to meet its responsibilities, on such terms and for such period of time as its Board of Directors determines. Any such contract or agreement may include provisions for requirements purchases, restraints on resale or other dealings, exclusive dealing, pricing, territorial division, and other conduct or arrangements which may have an anti-competitive effect.

Q. A municipal natural gas agency may procure insurance against any losses in connection with its property, operations, or assets in such amounts and from such insurers as it deems desirable, or may self-insure against such losses.

R. A municipal natural gas agency may contract for and accept any gifts or grants or loans of funds or property or financial or other aid in any form from any source, and may comply, subject to the provisions of this Division, with the terms and conditions thereof.

S. A municipal natural gas agency may mortgage, pledge and grant a security interest in any or all of its real and personal property to secure the payment of its bonds or contracts.

T. That part of a project owned by a municipal natural gas agency shall be exempt from property taxes. However, each municipal natural gas agency owning all or any part of a project shall, in lieu of property taxes, pay to any governmental unit authorized to levy property taxes the amount which would be assessed as taxes on real property of a project if such project were otherwise subject to valuation and assessment. Such payments in lieu of taxes shall be due and shall bear interest if unpaid, as in the cases of taxes on other property. Payments in lieu of taxes made under this Division shall be treated in the same manner as taxes for purposes of all procedural and substantive provisions of law, except that no lien may be placed upon such property to enforce the payment of such taxes. The remedy for such payment shall be limited to mandamus or other civil action requesting an order directing the agency to pay such taxes and interest, if any.

U. No municipal natural gas agency shall be authorized by this Division to sell natural gas directly to other than a member municipality or an eligible utility.

V. A municipal natural gas agency may adopt a corporate seal, and may sue and be sued.

W. A municipal natural gas agency may exercise all other powers not inconsistent with the Constitution of the State of Illinois or the United States Constitution, which powers may be reasonably necessary or appropriate for or incidental to effectuate its authorized purposes or to the exercise of any of the powers enumerated in this Division.

(Source: P.A. 84-1221.)