State of Illinois
91st General Assembly

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 1        AN ACT  concerning  distribution  of  tobacco  litigation
 2    settlement proceeds.

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

 5        Section 1. Short title. This Act  may  be  cited  as  the
 6    Investment of Tobacco Settlement Proceeds Act.

 7        Section  5.  Purpose.  This  Act  is  created to invest a
 8    portion of the  proceeds  from  this  State's  share  of  the
 9    nationwide   tobacco   settlement  into  biomedical  research
10    designed to increase  the  understanding  of  tobacco-related
11    illness  and  to  improve  the treatment and care of Illinois
12    residents harmed by tobacco use.

13        Section 10. Definitions. For purposes of this Act:
14        "Affiliated teaching hospital" means a  hospital  located
15    in Illinois that is either (i) under common ownership with an
16    eligible medical school or (ii) a free-standing hospital that
17    has  an  affiliation  agreement  relating  to the training of
18    medical residents with an eligible medical school.
19        "Base funding amount" means an amount equal to 5% of  the
20    total  unrestricted  proceeds  allocated  by  this Act to the
21    Tobacco Settlement Biomedical Research Fund.
22        "Committee"  means  the   Tobacco   Settlement   Advisory
23    Committee,  which  shall  be  composed  of  the deans of each
24    eligible medical school or their designees.
25        "Eligible medical  school"  means  a  public  or  private
26    university  located  in  the  State  of Illinois with a fully
27    accredited medical school conducting, either alone or through
28    its  affiliated  teaching  hospitals,  at  least   $3,000,000
29    annually in National Institutes of Health sponsored research.
30        "IDPH" means the Illinois Department of Public Health.
                            -2-                LRB9105878LDks
 1        "NIH" means the National Institutes of Health.
 2        "NIH  allocation amount" means the remaining funds in the
 3    Tobacco Settlement Biomedical Research Fund that  are  to  be
 4    distributed  to  each  eligible  medical school following the
 5    annual distribution of the base funding amount.
 6        "NIH allocation calculations" means the  method  used  to
 7    determine the NIH allocation formula funding amounts for each
 8    eligible  medical  school.  On June 1 of each year, using the
 9    previous federal  fiscal  year  data  for  NIH  funding,  the
10    Committee shall:
11        (i)  determine  the  total  NIH  funding received by each
12    eligible medical school, which  determination  shall  include
13    the  total  NIH  funding  received  by  respective affiliated
14    teaching hospitals;
15        (ii)  determine the total NIH  funding  received  by  all
16    eligible  medical  schools,  including  respective affiliated
17    teaching hospitals;
18        (iii)  determine   each   eligible    medical    school's
19    percentage of the total NIH funding by dividing the total NIH
20    funding   received   by   each  eligible  medical  school  as
21    determined in item (i) into the total NIH funding received by
22    all eligible medical schools as determined in item (b); and
23        (iv)  determine  the  NIH  allocation   formula   funding
24    amounts  for  each eligible medical school by multiplying the
25    NIH funding percentage for each eligible  medical  school  as
26    determined in item (iii) by the NIH allocation amount.
27        "NIH  allocation formula funding amount" means the amount
28    each eligible  medical  school  receives  based  on  the  NIH
29    allocation calculations.
30        "Settlement   agreement"   means   the  portions  of  the
31    settlement agreement in the case of People v. Philip  Morris,
32    Inc.  et al. (Case number 96L13146 in the Cook County Circuit
33    Court) and any associated litigation that is relevant to this
34    State.
                            -3-                LRB9105878LDks
 1        "Tobacco-related  illness  research"   means   basic   or
 2    clinical   research  directed  toward  the  understanding  of
 3    tobacco-related illnesses,  including  but  not  limited  to:
 4    oral,  pharyngeal, and esophageal cancers, and cancers of the
 5    lung,  bladder, and kidney; cardiovascular disease, including
 6    heart  attacks  and  strokes;  pulmonary  disease,  including
 7    emphysema and asthma;  and  neurological  disease,  including
 8    stroke, nicotine addiction, and chronic depression.
 9        "Tobacco  Settlement  Biomedical Research Fund" means the
10    fund created pursuant to Section 15 of this Act.
11        "Unrestricted proceeds" means that portion of the  moneys
12    received by the State under the settlement agreement, the use
13    of  which is not restricted under the terms of the settlement
14    agreement.

15        Section 15. Tobacco Settlement Biomedical Research Fund.
16        (a)  The Tobacco Settlement Biomedical Research  Fund  is
17    created as a special fund in the State Treasury.
18        (b)  One  third  of all unrestricted proceeds received by
19    the State under the settlement agreement shall  be  deposited
20    into the Tobacco Settlement Biomedical Research Fund.

21        Section 20. Allocation and disbursement of funds.
22        (a)  On  June 1 of each year, the Committee shall perform
23    and certify the NIH allocation calculations.
24        (b)  Moneys in the Tobacco Settlement Biomedical Research
25    Fund shall be appropriated  annually  to  the  University  of
26    Illinois, which shall transfer funds to each eligible medical
27    school  in accordance with this Section with the exception of
28    the base funding amount  for  Southern  Illinois  University,
29    which  shall  be  appropriated  directly to that institution.
30    Funds shall be distributed on June 30 of each  year  to  each
31    eligible medical school in the following manner:
32             (1)  Each  eligible  medical  school shall receive a
                            -4-                LRB9105878LDks
 1        base funding amount.
 2             (2)  Each fiscal year, each eligible medical  school
 3        shall  receive  its  respective  NIH  Allocation  Formula
 4        Funding Amount.

 5        Section  25.  Use  of  funds.  Eligible  medical  schools
 6    receiving   funds  from  the  Tobacco  Settlement  Biomedical
 7    Research Fund may use such funds to:
 8        (i)  support ongoing programs relating to tobacco-related
 9    illness research;
10        (ii)  create new  programs  relating  to  tobacco-related
11    illness research; and
12        (iii)  improve,  equip,  or construct laboratory space to
13    be used in furtherance of tobacco-related illness research.

14        Section 30. Reporting requirement.
15        (a)  On May 31 of each year, each eligible medical school
16    shall submit to IDPH a report detailing its use of funds from
17    the Tobacco Settlement Biomedical Research Fund. Each  report
18    shall  provide  a  detailed  account  of how these funds were
19    spent and shall provide an analysis of the  progress  of  the
20    tobacco-related illness research funded under this Act during
21    the previous year.
22        (b)  The  IDPH shall annually review each such report and
23    prepare a summary report to  the  Governor  and  the  General
24    Assembly.

25        Section  35.  Institutions  conducting  their  own annual
26    audits; audit  requirements;  election.  Notwithstanding  the
27    requirements  of  any  other  State  law  or  regulation,  an
28    eligible medical school that is a component of an institution
29    of  higher  education  that conducts annual audits of its own
30    operations, may elect to fulfill any audit requirements  with
31    respect to any or all funds received under this Act by having
                            -5-                LRB9105878LDks
 1    such  audit  conducted at the time of its own annual audit at
 2    its own cost.
 3        Each eligible medical school shall make such election  at
 4    the  time  that  it  receives  funds  under  this  Act.  Each
 5    eligible medical school shall not be required to  elect  that
 6    all  State  grants  be  included  in  its  annual audit. Such
 7    election may be for either financial or compliance audits, or
 8    both. In the  event  of  such  election,  such  audits  shall
 9    fulfill the audit requirements of the applicable State law or
10    regulation  authorizing  such grants except for the reporting
11    dates  required  for  such  audits.  Such  audits  shall   be
12    conducted  in  accordance  with  generally  accepted auditing
13    standards by certified public accountants  authorized  to  do
14    business in the State of Illinois.
15        The provisions of this Section do not limit the authority
16    of  any  State agency to conduct, or enter into contracts for
17    the  conduct  of,  audits  and  evaluations  of  State  grant
18    programs, nor limit the authority  of  the  Auditor  General.
19    Such  State agency shall fund the cost of any such additional
20    audits.

21        Section 40. Contravention of law.  Funds  received  under
22    this  Act  shall  not  be used in contravention of any law of
23    this State.

24        Section 90. The State Finance Act is  amended  by  adding
25    Section 5.490 as follows:

26        (30 ILCS 105/5.490 new)
27        Sec.  5.490.   The Tobacco Settlement Biomedical Research
28    Fund.

29        Section 99. Effective date. This Act  takes  effect  upon
30    becoming law.

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