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90_HB0863
105 ILCS 5/17-2C
745 ILCS 10/1-211 new
745 ILCS 10/1-212 new
745 ILCS 10/9-103 from Ch. 85, par. 9-103
745 ILCS 10/9-105 from Ch. 85, par. 9-105
745 ILCS 10/9-107 from Ch. 85, par. 9-107
Amends the School Code and the Local Governmental and
Governmental Employees Tort Immunity Act. Provides that the
Local Governmental and Governmental Employees Tort Immunity
Act does not authorize the issuance of bonds or the levying
of taxes by a local public entity to fund the costs of
complying with equitable remedies or relief or with an
injunction agreed to by the local public entity or ordered by
any court. Defines the terms "damages" and "liability" to
exclude from the meaning of those terms the cost or
obligation of complying with equitable remedies or relief or
with an injunction. Provides that a financially distressed
school district may not transfer from the Tort Immunity Fund
to any other school district fund any amount of moneys to
fund the cost of complying with equitable remedies or relief
or with an injunction agreed to by the school district or
ordered by any court. Adds that those provisions are
declaratory of existing law.
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1 AN ACT relating to tort immunity, amending named Acts.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 5. The School Code is amended by changing
5 Section 17-2C as follows:
6 (105 ILCS 5/17-2C)
7 Sec. 17-2C. Transfer from Tort Immunity Fund by
8 financially distressed school districts. The school board of
9 any school district that is certified under Section 19-1.5 as
10 a financially distressed school district may by resolution
11 transfer from the Tort Immunity Fund to any other school
12 district fund an amount of money not to exceed the lesser of
13 $2,500,000 or 0.6% of the value of the taxable property
14 within the district, provided the amount transferred is not
15 then required for the payment of any liabilities created by a
16 settlement or a tort judgement, defense costs, or for the
17 payment of any liabilities under the Unemployment Insurance
18 Act, Workers' Compensation Act, Occupational Diseases Act, or
19 risk care management programs.
20 Nothing in this Section authorizes a transfer from the
21 Tort Immunity Fund to any other school district fund of any
22 amount of moneys to fund the cost of complying with equitable
23 remedies or relief or with an injunction agreed to by the
24 school district or ordered by any court. This amendatory Act
25 of 1997 is declaratory of existing law.
26 (Source: P.A. 88-641, eff. 9-9-94.)
27 Section 10. The Local Governmental and Governmental
28 Employees Tort Immunity Act is amended by adding Sections
29 1-211 and 1-212 and changing Sections 9-103, 9-105, and 9-107
30 as follows:
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1 (745 ILCS 10/1-211 new)
2 Sec. 1-211. "Damages" means a sum of money awarded by
3 either judgment or settlement to a party on account of an
4 injury caused by the tortious act of a local public entity or
5 public employee, which sum of money is to be the separate
6 property of the party. "Damages" does not mean or include
7 the cost of complying with equitable remedies or relief or
8 with an injunction.
9 (745 ILCS 10/1-212 new)
10 Sec. 1-212. "Liability" means and refers exclusively to
11 liability for damages. "Liability" does not mean or refer to
12 liability for relief other than damages, such as the
13 obligation to comply with equitable remedies or relief or
14 with an injunction.
15 (745 ILCS 10/9-103) (from Ch. 85, par. 9-103)
16 Sec. 9-103. (a) A local public entity may protect itself
17 against any liability for damages that, property damage or
18 loss which may be imposed upon it or one of its employees for
19 a tortious act under Federal or State common or statutory
20 law, or imposed upon it under the Workers' Compensation Act,
21 the Workers' Occupational Diseases Act, or the Unemployment
22 Insurance Act by means of including, but not limited to,
23 insurance, individual or joint self-insurance, including all
24 operating and administrative costs and expenses directly
25 associated therewith, claims services and risk management
26 directly attributable to loss prevention and loss reduction,
27 legal services directly attributable to the insurance,
28 self-insurance, or joint self-insurance program, educational,
29 inspectional, and supervisory services directly relating to
30 loss prevention and loss reduction, or participation in a
31 reciprocal insurer as provided in Sections 72, 76 and 81 of
32 the Illinois Insurance Code. Insurance shall be carried with
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1 a company authorized by the Department of Insurance to write
2 such insurance coverage in Illinois.
3 (a-5) A local public entity may individually or jointly
4 self-insure provided it complies with any other statutory
5 requirements specifically related to individual or joint
6 self-insurance by local public entities. Whenever the terms
7 "self-insure" or "self-insurance" are utilized within this
8 Act, such term shall apply to both individual and joint
9 self-insurance. The expenditure of funds of a local public
10 entity to protect itself or its employees against liability
11 is proper for any local public entity. A local public entity
12 that has individually self-insured may establish reserves for
13 expected losses for any liability or loss for which the local
14 public entity is authorized to purchase insurance under this
15 Act. The decision of the local public entity to establish a
16 reserve and the amount of the reserve shall be based on
17 reasonable actuarial or insurance underwriting evidence.
18 Property taxes shall not be levied or extended if the effect
19 is to increase the reserve beyond 125% of the actuary's or
20 insurance underwriter's estimated ultimate losses at the 95%
21 confidence level. Certification of the amount of the reserve
22 shall be made by the independent auditor, actuary, or
23 insurance underwriter and included in an annual report.
24 (b) A local public entity may contract for or purchase
25 any of the guaranteed fund certificates or shares of
26 guaranteed capital as provided for in Section 56 of the
27 Illinois Insurance Code. The expenditure of funds of the
28 local public entity for said contract or purchase is proper
29 for any local public entity.
30 (c) Any insurance company that provides insurance
31 coverage to a local public entity shall utilize any
32 immunities or may assert any defenses to which the insured
33 local public entity or its employees are entitled. Public
34 entities which are individually or jointly self-insured shall
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1 be entitled to assert all of the immunities provided by this
2 Act or by common law or statute on behalf of themselves or
3 their employees unless the local public entities shall elect
4 by action of their corporate authorities or specifically
5 contract to waive in whole or in part such immunities.
6 (d) Within 30 days after January 1, 1991, and within 30
7 days after each January 1 thereafter, local public entities
8 that are individually or jointly self-insured to protect
9 against liability under the Workers' Compensation Act and the
10 Workers' Occupational Diseases Act shall file with the
11 Industrial Commission a report indicating an election to
12 self-insure.
13 This amendatory Act of 1997 is declaratory of existing
14 law.
15 (Source: P.A. 89-150, eff. 7-14-95.)
16 (745 ILCS 10/9-105) (from Ch. 85, par. 9-105)
17 Sec. 9-105. The board of a local taxing entity may,
18 instead of following the procedure under subdivision (b) of
19 Section 9-104 or when it considers the action advisable,
20 issue general obligation or revenue bonds without referendum
21 for the purpose of creating a reserve for or for the payment
22 of any cost, liability or loss against which such entity may
23 protect itself or self-insure pursuant to Section 9-103 or
24 for the payment of which such entity may levy a tax pursuant
25 to Section 9-107, including any or all tort judgments or
26 settlements entered against or entered into by the entity or
27 by or against another local public entity or an employee of
28 that other public entity while acting within the scope of
29 employment, either individually or where the local public
30 entities have joined in an intergovernmental joint
31 self-insurance contract which among other undertakings
32 authorizes each local public entity to utilize its funds to
33 protect, wholly or partially, any other local public entity
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1 or its employees against liability or loss in accordance with
2 the intergovernmental contract. Such bonds may be issued in
3 an amount necessary to fund a reserve created for any or all
4 of the above described purposes including the discharge of
5 obligations under such judgments or settlements. Such bonds
6 shall not be considered debt under any statutory limitation,
7 and may be issued in an amount, including existing
8 indebtedness, in excess of any heretofore or hereafter
9 imposed statutory limitation as to debt but subject to
10 constitutional limits.
11 Any bonds issued under this Section as limited bonds as
12 defined in Section 3 of the Local Government Debt Reform Act
13 shall comply with the requirements of the Bond Issue
14 Notification Act.
15 Nothing in this Act authorizes these bonds to be issued
16 in order to fund the cost of complying with equitable
17 remedies or relief or with an injunction agreed to by the
18 local taxing entity or ordered by any court. This amendatory
19 Act of 1997 is declaratory of existing law.
20 (Source: P.A. 89-655, eff. 1-1-97.)
21 (745 ILCS 10/9-107) (from Ch. 85, par. 9-107)
22 Sec. 9-107. A local public entity may annually levy or
23 have levied on its behalf taxes upon all taxable property
24 within its territory at a rate that will produce a sum that
25 will be sufficient to: (i) pay the cost of insurance,
26 individual or joint self-insurance (including reserves
27 thereon), including all operating and administrative costs
28 and expenses directly associated therewith, claims services
29 and risk management directly attributable to loss prevention
30 and loss reduction, legal services directly attributable to
31 the insurance, self-insurance, or joint self-insurance
32 program, and educational, inspectional, and supervisory
33 services directly relating to loss prevention and loss
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1 reduction, participation in a reciprocal insurer as provided
2 in Sections 72, 76, and 81 of the Illinois Insurance Code, or
3 participation in a reciprocal insurer, all as provided in
4 Section 9-103; (ii) pay the cost of settlements or judgments
5 under Section 9-102; (iii) pay, including all costs and
6 reserves directly attributable to being a member of an
7 insurance pool, under Section 9-103; (iv) (ii) pay the costs
8 of and principal and interest on bonds issued under Section
9 9-105; (v) (iii) pay judgments and settlements under Section
10 9-104; and (vi (iv) discharge obligations under Section
11 34-18.1 of The School Code, as now or hereafter amended, and
12 to pay the cost of risk management programs. Provided it
13 complies with any other applicable statutory requirements,
14 the local public entity may self-insure and establish
15 reserves for expected losses for any liability or loss for
16 which the local public entity is authorized to levy or have
17 levied on its behalf taxes for the purchase of insurance or
18 the payment of judgments or settlements under this Section.
19 The decision of the board to establish a reserve shall be
20 based on reasonable actuarial or insurance underwriting
21 evidence and subject to the limits and reporting provisions
22 in Section 9-103.
23 Funds raised pursuant to this Section shall only be used
24 for the purposes specified in this Act, including protection
25 against and reduction of any liability or loss described
26 hereinabove and under Federal or State common or statutory
27 law, the Workers' Compensation Act, the Workers' Occupational
28 Diseases Act and the Unemployment Insurance Act. Funds
29 raised pursuant to this Section may be invested in any manner
30 in which other funds of local public entities may be invested
31 under Section 2 of the Public Funds Investment Act. Interest
32 on such funds shall be used only for purposes for which the
33 funds can be used or, if surplus, must be used for abatement
34 of property taxes levied by the local taxing entity.
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1 A local public entity may enter into intergovernmental
2 contracts with a term of not to exceed 12 years for the
3 provision of joint self-insurance which contracts may include
4 an obligation to pay a proportional share of a general
5 obligation or revenue bond or other debt instrument issued by
6 a local public entity which is a party to the
7 intergovernmental contract and is authorized by the terms of
8 the contract to issue the bond or other debt instrument.
9 Funds due under such contracts shall not be considered debt
10 under any constitutional or statutory limitation and the
11 local public entity may levy or have levied on its behalf
12 taxes to pay for its proportional share under the contract.
13 Funds raised pursuant to intergovernmental contracts for the
14 provision of joint self-insurance may only be used for the
15 payment of any cost, liability or loss against which a local
16 public entity may protect itself or self-insure pursuant to
17 Section 9-103 or for the payment of which such entity may
18 levy a tax pursuant to this Section, including tort judgments
19 or settlements, costs associated with the issuance,
20 retirement or refinancing of the bonds or other debt
21 instruments, the repayment of the principal or interest of
22 the bonds or other debt instruments, the costs of the
23 administration of the joint self-insurance fund, consultant,
24 and risk care management programs or the costs of insurance.
25 Any surplus returned to the local public entity under the
26 terms of the intergovernmental contract shall be used only
27 for purposes set forth in subsection (a) of Section 9-103 and
28 Section 9-107 or for abatement of property taxes levied by
29 the local taxing entity.
30 Any tax levied under this Section shall be levied and
31 collected in like manner with the general taxes of the entity
32 and shall be exclusive of and in addition to the amount of
33 tax that entity is now or may hereafter be authorized to levy
34 for general purposes under any statute which may limit the
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1 amount of tax which that entity may levy for general
2 purposes. The county clerk of the county in which any part of
3 the territory of the local taxing entity is located, in
4 reducing tax levies under the provisions of any Act
5 concerning the levy and extension of taxes, shall not
6 consider any tax provided for by this Section as a part of
7 the general tax levy for the purposes of the entity nor
8 include such tax within any limitation of the percent of the
9 assessed valuation upon which taxes are required to be
10 extended for such entity.
11 With respect to taxes levied under this Section, either
12 before, on, or after the effective date of this amendatory
13 Act of 1994:
14 (1) Those taxes are excepted from and shall not be
15 included within the rate limitation imposed by law on
16 taxes levied for general corporate purposes by the local
17 public entity authorized to levy a tax under this
18 Section.
19 (2) Those taxes that a local public entity has
20 levied in reliance on this Section and that are excepted
21 under paragraph (1) from the rate limitation imposed by
22 law on taxes levied for general corporate purposes by the
23 local public entity are not invalid because of any
24 provision of the law authorizing the local public
25 entity's tax levy for general corporate purposes that may
26 be construed or may have been construed to restrict or
27 limit those taxes levied, and those taxes are hereby
28 validated. This validation of taxes levied applies to all
29 cases pending on or after the effective date of this
30 amendatory Act of 1994.
31 (3) Paragraphs (1) and (2) do not apply to a
32 hospital organized under Article 170 or 175 of the
33 Township Code, under the Town Hospital Act, or under the
34 Township Non-Sectarian Hospital Act and do not give any
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1 authority to levy taxes on behalf of such a hospital in
2 excess of the rate limitation imposed by law on taxes
3 levied for general corporate purposes. A hospital
4 organized under Article 170 or 175 of the Township Code,
5 under the Town Hospital Act, or under the Township
6 Non-Sectarian Hospital Act is not prohibited from levying
7 taxes in support of tort liability bonds if the taxes do
8 not cause the hospital's aggregate tax rate from
9 exceeding the rate limitation imposed by law on taxes
10 levied for general corporate purposes.
11 Revenues derived from such tax shall be paid to the
12 treasurer of the local taxing entity as collected and used
13 for the purposes of this Section and of Section 9-102,
14 9-103, 9-104 or 9-105, as the case may be. If payments on
15 account of such taxes are insufficient during any year to
16 meet such purposes, the entity may issue tax anticipation
17 warrants against the current tax levy in the manner provided
18 by statute.
19 Nothing in this Act authorizes the levying of taxes or
20 the issuance of bonds in order to fund the cost of complying
21 with equitable remedies or relief or with an injunction
22 agreed to by the local public entity or ordered by any court.
23 This amendatory Act of 1997 is declaratory of existing law.
24 (Source: P.A. 88-545; 88-692, eff. 2-4-95; 89-150, eff.
25 7-14-95.)