65 ILCS 5/ Illinois Municipal Code.

(65 ILCS 5/11-135.5-25)

Sec. 11-135.5-25. Board organization and powers.

(a) Organization of board. A commission shall organize by electing a chair from among its own members and shall elect persons, who need not be commissioners, to such other offices as shall be designated in the agreement. It shall adopt its own bylaws, rules, and regulations and provide for its meetings. The commission has full and complete supervision, management, and control of the waterworks system or the common source of supply of water, or both, as provided in the agreement and ordinances for acquiring and operating the same, and in their maintenance, operation, and extension. The board of commissioners shall determine the general policy of the commission, shall approve the annual budget, shall make all appropriations (which may include appropriations made at any time in addition to those made in any annual appropriation document), shall approve all contracts for the purchase or sale of water, shall adopt ordinances or resolutions providing for the issuance of bonds or notes by the commission, shall adopt its bylaws, rules, and regulations, and shall have such other powers and duties as may be prescribed in the agreement. Such agreement may further specify the voting and approval requirements for actions regarding the commission's powers and duties, including those powers and actions of the commission which shall be authorized only upon votes of greater than a majority of all commissioners or only upon consents of the corporate authorities of a certain number of member municipalities, or both.

The agreement may provide for the establishment of a technical advisory committee to consist of a municipal employee member from each member municipality as designated by ordinance or other official action, from time to time by the corporate authorities of the member municipality, and having the qualifications as prescribed in the agreement, and also may provide for such functions and duties of the committee as will support the efficient administration and operation of the commission.

The board of commissioners may establish other committees from time to time, consisting of either members of the board or members who are municipal employees from each member municipality, in order to support the efficient administration and operation of the commission.

(b) Water contracts to acquire water supply. A commission may contract to acquire a supply of water on such terms and conditions as it finds in the best interests of the commission for a period not exceeding 101 years. The term of the water supply contract may, at the end of the initial or extended term, be extended by an amendment, renewal, or revision beyond 101 years by further agreement of the parties. A commission may contract with any person, corporation, political subdivision, municipal corporation, or other governmental or non-governmental entity for a supply of water, and any such political subdivision, municipal corporation, or other governmental entity is authorized to enter into such a contract with the commission. A commission may accept from a municipality that is a member of the commission the assignment of a contract to acquire a supply of water and to accept and perform the duties and obligations and make all payments required pursuant to such assigned contract.

A contract made by or assigned to a commission for a supply of water may contain provisions whereby the commission is obligated to pay for such supply of water without setoff or counterclaim and irrespective of whether such supply of water is ever furnished, made available, or delivered to the commission or whether any project for the supply of water contemplated by the contract is completed, operable, or operating and notwithstanding any suspension, interruption, interference, reduction, or curtailment of the supply of water from such project.

No prior appropriation shall be required before entering into or accepting assignment of such contract, and no appropriation shall be required to authorize payments to be made under the terms of the contract, notwithstanding any provision of this Code to the contrary. The contract shall not be a debt within the meaning of any statutory or constitutional limitations.

(c) Water contracts to provide water supply to members. The commission is authorized to contract with the municipalities which established the commission, and with other municipalities that have become members pursuant to the process established in the intergovernmental agreement, for a supply of water to those municipalities, for a period not exceeding 101 years, and those municipalities are authorized to enter into such contracts with the commission. The term of the water supply contract may, at the end of the initial or extended term, be extended by an amendment, renewal, or revision beyond 101 years by further agreement of the parties.

Any such contract made by a commission and any such municipalities to supply water may contain provisions whereby the purchasing municipality is obligated to pay for such supply of water without setoff or counterclaim and irrespective of whether such supply of water is ever furnished, made available, or delivered to the purchasing municipality or whether any project for the supply of water contemplated by any such contract is completed, operable, or operating and notwithstanding any suspension, interruption, interference, reduction, or curtailment of the supply of water from such project. Any such contract may provide that if one or more of the other purchasers' defaults in the payment of its obligations under the contract or similar contract made with the supplier of the water, the remaining purchasers party to such contract or such similar contract shall be required to pay for all or a portion of the obligations of the defaulting purchaser. Each municipality that enters into such a contract shall be obligated and have the duty to include an amount sufficient to pay the annual amount of its obligation each year in the next succeeding appropriation ordinances. No prior appropriation shall be required for a municipality to authorize the payments, advances, or obligations provided for in such contracts or this subsection.

(d) Water contracts to provide water supply to nonmembers and extend system. A commission may supply water to and contract with a person, corporation, political subdivision, municipal corporation, or other governmental or non-governmental entity, in addition to the municipalities which have formed the commission and other municipalities that have become members pursuant to the process established in the intergovernmental agreement, and to construct water transmission and distribution lines within a radius of 25 miles outside the corporate limits of member municipalities for the purpose of furnishing water to any additional entities which contract with the commission for a supply of water, upon such payment, terms, and conditions as may be mutually agreed upon. Any such contract shall be a continuing, valid, and binding obligation of the purchaser for such period of years, not to exceed 40, as may be provided in such contract.

Any such contract entered into to supply water to a municipal corporation or political subdivision shall provide that the payments to be made thereunder shall be from the revenues to be derived by such municipality or political subdivision from the operation of the waterworks system or combined waterworks and sewer system of such municipality or political subdivision or from receipts from other sources available to the municipality or political subdivision, including grants and loans. Any such contract made by a commission and a purchaser that is such a municipal corporation or political subdivision to supply water may contain provisions whereby the purchaser is obligated to pay for such supply of water without setoff or counterclaim and irrespective of whether such supply of water is ever furnished, made available, or delivered to the purchaser or whether any project for the supply of water contemplated by any such contract is completed, operable, or operating and notwithstanding any suspension, interruption, interference, reduction, or curtailment of the supply of water from such project. The contract may provide that, if one or more of the other purchasers defaults in the payment of its obligations under such contract or similar contract made with the supplier of the water, the remaining purchasers party to such contract or such similar contract shall be required to pay for all or a portion of the obligations of the defaulting purchaser. Each municipal corporation or political subdivision that enters into such a contract shall be obligated and have the duty to include an amount sufficient to pay the annual amount of its obligation each year in the next succeeding appropriation ordinances. No prior appropriation shall be required for a municipality or political subdivision to authorize the payments, advances, or obligations provided for in such contracts or this subsection. Any such contract shall not be a debt within the meaning of any statutory or constitutional limitations.

(e) Additional powers. In addition to any other powers set forth in this Division and in the agreement, a commission has the following powers:

(1) The power to enter into intergovernmental police assistance agreements with any municipality or county.

(2) The power to enter into intergovernmental agreements with any unit of local government or other governmental entity in order to carry out the purposes for which the commission was formed.

(Source: P.A. 102-684, eff. 12-16-21; 102-1134, eff. 2-10-23.)

(65 ILCS 5/11-135.5-30)

Sec. 11-135.5-30. Revenue bonds.

(a) Revenue bonds; power; purposes. A commission may from time to time issue its revenue bonds in such principal amounts as the commission deems necessary to provide sufficient funds to carry out any of its corporate purposes and powers, including, without limitation: developing, acquiring, constructing, extending, or improving a waterworks system or common source of supply of water, or any combination thereof; the funding or refunding of the principal of, redemption premium on, if any, and interest on bonds issued by it, whether or not such bonds or interest to be funded or refunded have or have not become due; the payment of engineering, legal, and other expenses, together with interest to a date one year subsequent to the estimated date of completion of the project; the establishment or increase of reserves to secure or to pay such bonds and interest thereon; the providing of working capital; and the payment of all other costs or expenses of the commission incident to and necessary or convenient to carry out its corporate purposes and powers. These bonds shall have all the qualities of negotiable instruments under the laws of this State and shall not constitute indebtedness of any of the municipalities constituting the commission.

(b) Source of payment. Every issue of bonds of a commission shall be payable out of the revenues to be derived pursuant to contracts with the specified municipalities and other purchasers of water or by virtue of the operation of any properties acquired or to be acquired or constructed. A commission may issue such types of bonds as it determines, including bonds as to which the principal and interest are payable from the revenues from one or more projects, or from an interest therein or a right to the products and services thereof, or from one or more revenue producing contracts made by the commission, or its revenues generally. Any such bonds may be additionally secured by a pledge of any grant, subsidy, contribution, or other revenue source from the United States, the State of Illinois, or any unit of local government, or any combination thereof.

(c) Receipt of funds by treasurer. Before the treasurer of the commission is entitled to receive the proceeds of the sale of such a bond issue, the treasurer shall supply a corporate surety bond in an amount equivalent to the amount of funds to be derived from the sale of the bonds, and, in addition thereto, the treasurer shall supply a separate corporate surety bond for the faithful accounting of any funds that may come into that individual's possession in an amount equal to the amount of funds likely to come into the treasurer's hands in any one year from the revenue to be derived from the operation of any of the properties of the commission. The cost of these surety bonds shall be paid by the commission. The requirement to supply corporate surety bonds under this subsection does not apply to the extent that the proceeds of the sale of the bonds and other funds are subject to the administration of the trustee pursuant to a trust indenture with a bank or trust company.

(d) Approval process; terms. The revenue bonds shall be issued pursuant to an ordinance or resolution, or, in the alternative, pursuant to a master trust indenture as well as a supplemental trust indenture with each issuance, and may be issued in one or more series, and shall bear such date or dates, mature at such time or times within the estimated period of usefulness of the project involved and, in any event, not more than 50 years from the date thereof, bear interest at such rate or rates as authorized under Section 2 of the Bond Authorization Act, which rates may be fixed or variable, be in such denominations, be in such form, either coupon or registered, carry such conversion, registration, and exchange privileges, have such rank or priority, be executed in such manner, be payable in such medium of payment at such place or places within or without the State, be subject to such terms of redemption with or without premium, and contain or be subject to such other terms as the ordinance or resolution, or the master trust indenture or supplemental trust indenture or both, may provide, and shall not be restricted by the provisions of any other law limiting the amounts, maturities, interest rates, or other terms of obligations of public agencies or private persons. The master trust indenture and any supplemental trust indenture shall be entered into with a bank or trust company within or outside the State having trust powers and possessing capital and surplus of not less than $50,000,000. The bonds shall be sold in such manner as the commission shall determine, at private or public sale. It shall not be necessary that the ordinance or resolution, or the master trust indenture or supplemental trust indenture or both, refer to plans and specifications nor that there be on file for public inspection prior to the adoption of such ordinance or resolution, or the master trust indenture or supplemental trust indenture or both, detailed plans and specifications of the project. This ordinance or resolution, or the master trust indenture or supplemental trust indenture or both, may contain such covenants and restrictions in relation to the operation of the properties under the control of the commission and the issuance of additional revenue bonds thereafter as may be deemed necessary or advisable for the assurance of payment of the bonds thereby authorized and as may be thereafter issued. It shall be plainly stated on each bond that it does not constitute an indebtedness of any municipality represented by the commission within the meaning of any statutory or constitutional limitation. Upon the issuance of revenue bonds, the revenue of the commission derived pursuant to contracts entered into for the sale of water to the municipalities that have formed the commission and to other municipalities that have become members pursuant to the intergovernmental agreement, as well as contracts entered into with other persons, corporations, political subdivisions, municipal corporations, or other governmental or non-governmental entities and from the operation of its properties, shall be accounted for as provided in the ordinance or resolution, or the master trust indenture or supplemental trust indenture or both, authorizing the issuance of the bonds. Any commission created under the provisions of this Division may also issue bonds for the purpose of providing funds for the payment, refunding, or redemption of any of the commission's bonds or notes before, after, or at their maturity, including the payment of redemption premiums or interest accruing or to accrue on such bonds or notes being paid or redeemed, and for the payment of any installments of interest accrued or to accrue on any bond or note.

(e) No limitation. The provisions of this Section are not a limit upon a municipality that is a home rule unit.

(Source: P.A. 102-684, eff. 12-16-21.)

(65 ILCS 5/11-135.5-35)

Sec. 11-135.5-35. Revenues; rates; costs; construction contracts.

(a) Revenue fund. Whenever bonds are issued under this Division, the revenue received from the operation of the properties under the control of the commission shall be set aside as collected and deposited in a separate fund to be used only (1) in paying the cost of the operation and maintenance of those properties, (2) in providing an adequate depreciation fund, (3) in paying the principal of and interest upon the revenue bonds issued by the commission, as provided by this Division, (4) to comply with the covenants of the ordinance or resolution, or the master trust indenture or any applicable supplemental trust indenture or both, authorizing the issuance of such bonds, and (5) to carry out the corporate purposes and powers of the commission.

(b) Rates and charges for waterworks system. If the commission has charge of the operation of a complete waterworks system, including the distribution mains, the commission shall establish rates and charges for water and the use of commission waterworks system facilities, which shall be sufficient at all times to pay the cost of operation and maintenance, to provide an adequate depreciation fund, to pay the principal of and interest upon all revenue bonds issued as provided by this Division, to comply with the covenants of the ordinance or resolution, or the master trust indenture or any applicable supplemental trust indenture or both, authorizing the issuance of such bonds, and to carry out the corporate purposes and powers of the commission. Charges and rates shall be established, revised, and maintained by ordinance and become payable as the commission may determine by ordinance.

(c) Rates and charges for water source of supply. If the commission has charge of the operation of a common source of supply of water, the municipalities represented by the commission shall contract with the commission for water. These municipalities shall establish such charges and rates for water supplied by them to consumers as will be sufficient at all times (1) to pay the cost of operation and maintenance of the respective waterworks systems (or combined waterworks and sewerage systems) of the municipalities, (2) to provide an adequate depreciation fund therefor, (3) to pay the principal of and interest on all revenue bonds of the municipalities payable from the revenues of the waterworks system (or combined waterworks and sewerage system), and (4) to pay the charges and rates established by the commission for the sale of water by the commission to, and the use of commission waterworks system facilities by, those municipalities. The commission shall establish such charges and rates for water supplied to those municipalities and the use of commission waterworks system facilities as will be sufficient at all times (1) to pay the cost of operation and maintenance of the common source of supply of water, (2) to provide an adequate depreciation fund therefor, (3) to pay the principal of and interest on the revenue bonds issued by the commission, (4) to comply with the covenants of the ordinance or resolution, or the master trust indenture or any applicable supplemental trust indenture or both, authorizing the issuance of such bonds, and (5) to carry out the corporate purposes and powers of the commission, under the provisions of this Division. Contracts entered into between the commission and the specified municipalities shall include covenants for the establishment of rates and charges as provided in this Section.

(d) Pension costs. Contributions to a retirement fund or other pension alternative authorized by the Illinois Pension Code, including, without limitation, the Illinois Municipal Retirement Fund, by commissions created under this Division which have been included under the retirement fund or other pension alternative shall be considered a cost of operation and maintenance for the purposes of this Section.

(e) Enforcement of obligations. An owner of a bond issued under this Division, a trustee under a master trust indenture or supplemental trust indenture or both with respect to the bonds issued under this Division, or both the owner and trustee may, in a civil action, mandamus action, or other proceeding, enforce and compel performance of all duties required by this Division to be performed by such a commission or by any of the municipalities, including the making of rates and charges, the collecting of sufficient revenue, and the application thereof, as provided in this Division.

(f) Construction contracts. All or any portion of a waterworks system or other public improvement of such a commission, when the expense thereof will exceed the greater of (i) $25,000 or (ii) the amount of expense above which a work or public improvement by a municipality must be let to the lowest responsible bidder after advertising for bids under Section 8-9-1 of this Code, shall be constructed, maintained, or repaired either: (1) by a contract let to the lowest responsible bidder after advertising for bids, in the manner prescribed by the commission's bylaws, rules, and regulations and by the vote required as established in the intergovernmental agreement pursuant to Section 11-135.5-25; or (2) without advertising for bids, if authorized by a vote of greater than a majority of all the commissioners as established in the intergovernmental agreement pursuant to Section 11-135.5-25. The commission's bylaws, rules, and regulations shall provide for an alternative procedure for emergency procurement if an emergency makes it impracticable to follow the procedures in this subsection.

(g) Alternative project delivery. A commission may use alternative project delivery methods if the commission determines it to be in the commission's best interest for a particular project. An alternative project delivery method may include, without limitation, design-build or construction-manager-at-risk. All notices for the procurement of goods, services, or work to be provided pursuant to an alternate delivery method shall include all requirements for the goods, services, or work to be procured. All awards of contracts or agreements for the procurement of goods, services, or work to be provided pursuant to an alternate delivery method shall be made on the basis of demonstrated competence and qualifications and with due regard for the principles of competitive selection. As part of an alternate project delivery procurement process, prior to submission of proposals, the commission may conduct meetings and exchange confidential information with proposers to promote understanding of the request for proposals, review alternative design concepts, or discuss other issues related to the procurement.

As used in this subsection:

"Construction-manager-at-risk" means a delivery method in which the party proposing to be the construction manager commits to be responsible for performance of certain preconstruction services and, if the parties reach agreement on key terms, becomes responsible for construction of the project.

"Design-build" means a delivery method that provides responsibility within a single contract for furnishing the architectural, engineering, land-surveying, and related services for the project, as well as the labor, materials, equipment, and other construction services for the project.

(h) Procurement goals and requirements. A commission may establish goals or requirements for the procurement of goods and services and for construction contracts to promote and encourage the continuing economic development of (i) businesses that are owned and operated by minorities, women, persons with disabilities, or veterans; (ii) businesses that are located within the territory of one or more of the municipalities that are members of the commission; (iii) businesses that employ persons who reside in the territory of one or more of the municipalities that are members of the commission; (iv) businesses that are located within the territory of a municipality having more than 2,000,000 inhabitants in which a portion of the commission's waterworks system or other commission improvement is located; or (v) businesses that employ persons who reside in the territory of a municipality having more than 2,000,000 inhabitants in which a portion of the commission's waterworks system or other commission improvement is located.

A commission may also establish other goals or requirements that result in the award to a responsible bidder other than the lowest responsible bidder if the commission determines that the award is in the commission's best interests, notwithstanding the requirements of subsection (f). Goals or requirements that are set by a commission that result in a preference being applied to a bidder or proposer, who has met those goals or requirements, in a commission's process for awarding construction contracts and for the procurement of goods and services must comply with the constitutional standards applicable to the preferences.

(i) Contract assignment. A member municipality may enter into a contract for any portion of a waterworks system or other public improvement of a commission pursuant to a contracting method that is consistent with the requirements applicable to the municipality and generally consistent with the principles in subsection (f) or (g). The commission may accept assignment of such a contract and of payment obligations under that contract.

(j) Project labor agreement. In connection with a contract by a commission for the construction of all or any portion of a waterworks system or other public improvement of the commission, the commission must enter into a project labor agreement with the applicable local building trades council prior to the commencement of any and all construction, building, renovation, demolition, or any material change to the structure or land.

(Source: P.A. 102-684, eff. 12-16-21; 102-1134, eff. 2-10-23.)

(65 ILCS 5/11-135.5-40)

Sec. 11-135.5-40. Property.

(a) Generally. A commission may (i) acquire, hold, sell, lease as lessor or lessee, transfer, or dispose of real or personal property, or interest therein, and (ii) acquire by gift, legacy, or grant any real estate or personal property, or rights therein, in all such instances as it deems appropriate in the exercise of its powers for its lawful purposes, whether the land or personal property is located within or outside the boundaries of the members of the commission. The commission also may accept any grant, subsidy, or contribution from the United States, the State of Illinois, a unit of local government, or any other governmental entity, or any combination thereof.

(b) Private property. Whenever a commission passes an ordinance for the construction or acquisition of any waterworks properties, or improvements or extension or mains, pumping stations, reservoirs, or other appurtenances thereto, which such commission is authorized to make, the making of which will require that private property be taken or damaged, such commission may cause compensation therefor to be ascertained and may condemn and acquire possession thereof in the same manner as nearly as may be, as provided for the exercise of the right of eminent domain under the Eminent Domain Act. However, proceedings to ascertain the compensation to be paid for taking or damaging private property shall be instituted in the circuit court of the county where the property sought to be taken or damaged is situated.

(c) Public property. When a commission created under this Division requires that public property be taken or damaged for the purposes specified in this Section, the commission may condemn and acquire possession of public property and cause compensation for such public property to be ascertained in the same manner provided for the exercise of the right of eminent domain under the Eminent Domain Act while the commission has the power to initiate action in the manner provided by Article 20 of the Eminent Domain Act.

(d) Highways and public ground. A commission may construct, maintain, alter, and extend its water mains as a proper use of highways along, upon, under, and across any highway, street, alley, or public ground in the State, including highways within a municipality, but so as not to inconvenience the public use thereof, and the commission may construct, maintain, and operate any conduit or conduits, water pipe or pipes, wholly or partially buried or otherwise in, upon, and along any of the lands owned by the State and under any of the public waters therein. However, the right, permission, and authority hereby created shall be subject to all public rights of commerce and navigation and the authority of the United States in behalf of such public rights and also the laws of the State to regulate and control the same. Notice shall be given to the highway authorities of a municipality, county, township, road district, or township district in which such highway, street, or public way may be situated at least 60 days before any construction or installation work in such highway or street shall commence. All laws and ordinances pertaining to such work for the protection of the public and of public property shall be complied with, except that no fee may be charged such commission for the construction or installation of such facilities in such public places.

(e) Surplus property. When, in the opinion of a commission, real estate owned by it, however acquired, is no longer necessary, appropriate, required for the use of, profitable to, or for best interest of the commission, such commission may, by resolution, lease such surplus real estate for a period not to exceed 99 years or sell such surplus real estate, in accordance with procedures established in the intergovernmental agreement or bylaws or adopted by resolution by such commission.

(f) Tax exemption. All property, income, and receipts of or transactions by a commission shall be exempt from all taxation, the same as if it were the property, income, or receipts of or transaction by the member municipalities.

(g) Agricultural impact mitigation agreement. For any private property that is used for agricultural purposes, as defined in Section 1-60 of the Property Tax Code, that is damaged or taken by a commission created under this Division, the commission shall enter into an agricultural impact mitigation agreement with the Illinois Department of Agriculture to ensure any negative impacts to private property are properly mitigated.

(Source: P.A. 102-684, eff. 12-16-21.)