State of Illinois
91st General Assembly
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Public Act 91-0134

SB169 Enrolled                                 LRB9102160DHpk

    AN ACT to amend the Intergovernmental Cooperation Act  by
changing Section 3.1.

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

    Section 5.   The  Intergovernmental  Cooperation  Act  is
amended by changing Section 3.1 as follows:

    (5 ILCS 220/3.1) (from Ch. 127, par. 743.1)
    Sec. 3.1.  Municipal Joint Action Water Agency.
    (a)  Any  municipality  or  municipalities of this State,
any county or counties of  this  State,  any  township  in  a
county  with  a  population  under 700,000 of this State, any
public water district or districts  of  this  State,  or  any
combination  thereof  may,  by  intergovernmental  agreement,
establish  a  Municipal  Joint Action Water Agency to provide
adequate supplies of water on  an  economical  and  efficient
basis  for  member municipalities, public water districts and
other  incorporated  and  unincorporated  areas  within  such
counties. For purposes of this Act, the water supply may only
be derived from Lake Michigan,  the  Mississippi  River,  the
Missouri  River,  or the Sangamon River Valley Alluvium.  Any
such Agency shall itself be a municipal  corporation,  public
body  politic  and corporate.  A Municipal Joint Action Water
Agency so created shall not itself have taxing  power  except
as hereinafter provided.
    A   Municipal   Joint   Action   Water  Agency  shall  be
established  by  an  intergovernmental  agreement  among  the
various  member  municipalities,  public   water   districts,
townships,  and  counties,  upon  approval  by  an  ordinance
adopted   by   the   corporate  authorities  of  each  member
municipality, public water  district,  township,  or  county.
This  agreement  may be amended at any time upon the adoption
of concurring ordinances by the corporate authorities of  all
member municipalities, public water districts, townships, and
counties.    The   agreement   may   provide  for  additional
municipalities, public water districts, townships in counties
with a population under 700,000,  or  counties  to  join  the
Agency  upon  adoption  of  an  ordinance  by  the  corporate
authorities   of   the  joining  municipality,  public  water
district,  township,  or  county,  and  upon  such  consents,
conditions  and  approvals  of  the  governing  body  of  the
Municipal Joint Action Water Agency and  of  existing  member
municipalities,   public  water  districts,  townships,   and
counties  as  shall  be  provided  in  the  agreement.    The
agreement  shall  provide  the  manner and terms on which any
municipality, public water district, township, or county  may
withdraw  from membership in the Municipal Joint Action Water
Agency and on which the Agency may terminate and dissolve  in
whole  or  in  part.   The  agreement  shall  set  forth  the
corporate name of the Municipal Joint Action Water Agency and
its  duration.   Promptly  upon  any agreement establishing a
Municipal Joint Action Water Agency being  entered  into,  or
upon  the  amending  of  any  such  agreement, a copy of such
agreement or amendment shall be filed in the  office  of  the
Secretary  of  State of Illinois.  Promptly upon the addition
or withdrawal of any  municipality,  public  water  district,
township  in  a  county  with  a population under 700,000, or
county, or upon the dissolution of a Municipal  Joint  Action
Water  Agency,  that fact shall be certified by an officer of
the Agency to the Secretary of State of Illinois.
    (b)  The governing body of  any  Municipal  Joint  Action
Water  Agency  established pursuant to this Section 3.1 shall
be a Board of Directors. There shall  be  one  Director  from
each  member  municipality,  public water district, township,
and  county  of  the  Municipal  Joint  Action  Water  Agency
appointed by ordinance of the corporate  authorities  of  the
municipality,  public  water  district,  township, or county.
Each Director shall have one vote. Each Director shall be the
Mayor  or  President  of  the  member  municipality,  or  the
chairman of the board of trustees of the member public  water
district,  the  supervisor  of  the  member  township, or the
chairman of the county board or chief  executive  officer  of
the  member  county or a county board member appointed by the
chairman of the county board of the member county, appointing
the Director; an elected member of the corporate  authorities
of  that  municipality,  public  water district, township, or
county;  or  other  elected  official   of   the   appointing
municipality,  public  water  district,  township, or county.
Any agreement establishing a  Municipal  Joint  Action  Water
Agency shall specify the period during which a Director shall
hold  office and may provide for the appointment of Alternate
Directors from member municipalities, public water districts,
townships, or counties.  The Board of Directors  shall  elect
one  Director  to serve as Chairman, and shall elect persons,
who need not be Directors, to such other offices as shall  be
designated in the agreement.
    The Board of Directors shall determine the general policy
of the Municipal Joint Action Water Agency, 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 any
resolutions providing for the issuance of bonds or  notes  by
the  Agency,  shall adopt its by-laws, rules and regulations,
and shall have  such  other  powers  and  duties  as  may  be
prescribed  in  the  agreement.   Such  agreement may further
specify those powers  and  actions  of  the  Municipal  Joint
Action Water Agency which shall be authorized only upon votes
of  greater  than  a  majority  of all Directors or only upon
consents of the corporate authorities of a certain number  of
member  municipalities, public water districts, townships, or
counties.
    The agreement may provide for  the  establishment  of  an
Executive  Committee  to  consist of the municipal manager or
other  elected  or  appointed   official   of   each   member
municipality,  public water district, township, or county, as
designated by ordinance from time to time  by  the  corporate
authorities   of   the   member  municipality,  public  water
district, township, or county, and may prescribe  powers  and
duties   of   the   Executive  Committee  for  the  efficient
administration of the Agency.
    (c)  A Municipal Joint Action  Water  Agency  established
pursuant  to  this  Section 3.1 may plan, construct, improve,
extend, acquire, finance (including the issuance  of  revenue
bonds  or  notes  as  provided in this Section 3.1), operate,
maintain, and contract for a joint waterworks or water supply
system  which  may  include,  or  may  consist  of,   without
limitation,    facilities   for   receiving,   storing,   and
transmitting water from any source  for  supplying  water  to
member  municipalities, public water districts, townships, or
counties (including  county  special  service  areas  created
under  the  Special  Service  Area Tax Act and county service
areas authorized under the Counties Code),  or  other  public
agencies,   persons,   or  corporations.  Facilities  of  the
Municipal Joint Action Water Agency may be located within  or
without the corporate limits of any member municipality.
    A  Municipal  Joint  Action  Water Agency shall have such
powers as shall be provided in the agreement establishing it,
which may include, but need not be limited to, the  following
powers:
         (i)  to sue or be sued;
         (ii)  to  apply  for  and  accept gifts or grants or
    loans of funds or property or financial or other aid from
    any public agency or private entity;
         (iii)  to acquire, hold, sell, lease  as  lessor  or
    lessee,  transfer  or  dispose  of  such real or personal
    property, or interests therein, as it  deems  appropriate
    in the exercise of its powers, and to provide for the use
    thereof   by   any   member  municipality,  public  water
    district, township, or county;
         (iv)  to make and execute all  contracts  and  other
    instruments  necessary  or  convenient to the exercise of
    its   powers    (including    contracts    with    member
    municipalities,   with   public   water  districts,  with
    townships, and with counties on behalf of county  service
    areas); and
         (v)  to  employ agents and employees and to delegate
    by resolution to one or more of its Directors or officers
    such powers as it may deem proper.
    Member municipalities, public water districts, townships,
or counties may, for the purposes of, and  upon  request  by,
the  Municipal  Joint Action Water Agency, exercise the power
of eminent domain  available  to  them,  convey  property  so
acquired  to  the  Agency for the cost of acquisition, and be
reimbursed for all  expenses  related  to  this  exercise  of
eminent domain power on behalf of the Agency.
    All property, income and receipts of or transactions by a
Municipal  Joint Action Water Agency shall be exempt from all
taxation, the same as if it  were  the  property,  income  or
receipts  of  or  transaction  by  the member municipalities,
public water districts, townships, or counties.
    (d)  A Municipal Joint Action  Water  Agency  established
pursuant  to  this  Section  3.1  shall have the power to buy
water  and  to  enter  into  contracts   with   any   person,
corporation   or   public   agency   (including   any  member
municipality, public water district, township, or county) for
that purpose.  Any such contract made  by  an  Agency  for  a
supply  of water may contain provisions whereby the Agency is
obligated to pay for the supply of water  without  setoff  or
counterclaim  and irrespective of whether the supply of water
is ever furnished, made available or delivered to the  Agency
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  such  contract or a similar contract made
with the supplier of the water one or more of  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 purchasers. No such contract
may have a term in excess of 50 years.
    A Municipal Joint Action  Water  Agency  shall  have  the
power  to  sell  water  and  to enter into contracts with any
person, corporation or public agency  (including  any  member
municipality, any public water district, any township, or any
county  on  behalf  of  a county service area as set forth in
this Section) for that purpose.  No such contract may have  a
term  in  excess of 50 years.  Any such contract entered into
to sell water  to  a  public  agency  may  provide  that  the
payments to be made thereunder by such public agency shall be
made solely from revenues to be derived by such public agency
from  the  operation of its waterworks system or its combined
waterworks  and  sewerage  system.   Any  public  agency   so
contracting  to  purchase  water shall establish from time to
time such fees and charges for its water service or  combined
water  and  sewer service as will produce revenues sufficient
at all times to pay its obligations to the Agency  under  the
purchase  contract.  Any such contract so providing shall not
constitute indebtedness of such public agency so  contracting
to   buy  water  within  the  meaning  of  any  statutory  or
constitutional limitation.  Any such  contract  of  a  public
agency  to buy water shall be a continuing, valid and binding
obligation of such public agency payable from such revenues.
    A Municipal Joint Action  Water  Agency  shall  establish
fees and charges for the purchase of water from it or for the
use  of  its  facilities.   No  prior  appropriation shall be
required by either the Municipal Joint Action Water Agency or
any  public  agency  before  entering   into   any   contract
authorized by this paragraph (d).
    The  changes  in this Section made by this amendatory Act
of 1984 are intended to be declarative of existing law.
    (e) 1.  A Municipal Joint Action Water Agency established
pursuant to this Section 3.1 may, from time to  time,  borrow
money  and,  in  evidence  of  its  obligation  to  repay the
borrowing, issue its negotiable water revenue bonds or  notes
pursuant  to  this  paragraph  (e)  for  any of the following
purposes:  for  paying  costs  of  constructing,   acquiring,
improving  or  extending  a  joint waterworks or water supply
system; for paying other expenses incident to or incurred  in
connection  with  such construction, acquisition, improvement
or extension; for repaying advances made to or by the  Agency
for  such purposes; for paying interest on the bonds or notes
until  the  estimated  date  of  completion   of   any   such
construction,  acquisition,  improvement or extension and for
such period after the estimated completion date as the  Board
of  Directors  of  the  Agency  shall  determine;  for paying
financial, legal, administrative and other  expenses  of  the
authorization,  issuance, sale or delivery of bonds or notes;
for paying costs of insuring payment of the bonds  or  notes;
for  providing or increasing a debt service reserve fund with
respect to any or all of the Agency's bonds or notes; and for
paying, refunding or redeeming any of the Agency's  bonds  or
notes  before,  after  or at their maturity, including paying
redemption premiums or interest accruing or to accrue on such
bonds or notes being paid or redeemed or for paying any other
costs in connection with any such payment or redemption.
    2.  Any bonds or notes issued pursuant to this  paragraph
(e)  by  a  Municipal  Joint  Action  Water  Agency  shall be
authorized by a resolution of the Board of Directors  of  the
Agency  adopted  by  the affirmative vote of Directors from a
majority  of  the   member   municipalities,   public   water
districts,   townships,  and  counties,  and  any  additional
requirements  as  may  be  set   forth   in   the   agreement
establishing  the  Agency.  The authorizing resolution may be
effective immediately upon  its  adoption.   The  authorizing
resolution  shall  describe  in  a  general  way  any project
contemplated to be financed by the bonds or notes, shall  set
forth  the  estimated cost of the project and shall determine
its period of usefulness.  The authorizing  resolution  shall
determine  the  maturity or maturities of the bonds or notes,
the rate or rates at which the bonds or  notes  are  to  bear
interest  and all the other terms and details of the bonds or
notes.  All such bonds  or  notes  shall  mature  within  the
period of estimated usefulness of the project with respect to
which  such  bonds  or notes are issued, as determined by the
Board of Directors, but in any event not more than  50  years
from  their  date  of  issue.   The  bonds and notes may bear
interest, payable at such times,  at  a  rate  or  rates  not
exceeding   the   maximum   rate   established  in  the  Bond
Authorization Act, as from time to time in effect.  Bonds  or
notes  of a Municipal Joint Action Water Agency shall be sold
in such manner as the Board of Directors of the Agency  shall
determine,  either  at  par  or at a premium or discount, but
such  that  the  effective  interest  cost   (excluding   any
redemption premium) to the Agency of the bonds or notes shall
not  exceed a rate equal to the rate of interest specified in
the Act referred to in the preceding sentence.
    The resolution authorizing the issuance of any  bonds  or
notes  pursuant  to  this  paragraph  (e)  shall constitute a
contract with the  holders  of  the  bonds  and  notes.   The
resolution  may  contain such covenants and restrictions with
respect to the purchase or sale of water by  the  Agency  and
the  contracts  for such purchases or sales, the operation of
the joint waterworks  system  or  water  supply  system,  the
issuance  of  additional  bonds  or  notes by the Agency, the
security for the bonds and notes, and any other  matters,  as
may  be  deemed  necessary  or  advisable  by  the  Board  of
Directors  to assure the payment of the bonds or notes of the
Agency.
    3.  The resolution authorizing the issuance of  bonds  or
notes  by  a Municipal Joint Action Water Agency shall pledge
and provide for the application of revenues derived from  the
operation  of  the  Agency's joint waterworks or water supply
system (including from contracts for the sale of water by the
Agency) and investment earnings thereon to the payment of the
cost of operation and maintenance of  the  system  (including
costs   of   purchasing  water),  to  provision  of  adequate
depreciation, reserve or replacement funds  with  respect  to
the  system  or  the  bonds  or  notes, and to the payment of
principal, premium, if any, and  interest  on  the  bonds  or
notes  of  the  Agency (including amounts for the purchase of
such bonds or notes).   The  resolution  shall  provide  that
revenues  of  the  Municipal  Joint  Action  Water  Agency so
derived  from  the  operation  of  the   system,   sufficient
(together  with  other  receipts  of  the Agency which may be
applied to such purposes) to provide for such purposes, shall
be set aside as collected in a separate  fund  or  funds  and
used  for  such  purposes.   The  resolution may provide that
revenues not required for such purposes may be used  for  any
proper  purpose  of  the  Agency or may be returned to member
municipalities.
    Any notes of a Municipal Joint Action Water Agency issued
in anticipation of the  issuance  of  bonds  by  it  may,  in
addition,  be  secured by a pledge of proceeds of bonds to be
issued  by  the  Agency,  as  specified  in  the   resolution
authorizing the issuance of such notes.
    4. (i)  Except  as  provided in clauses (ii) and (iii) of
this subparagraph 4 of this  paragraph  (e),  all  bonds  and
notes  of  the  Municipal  Joint  Action  Water Agency issued
pursuant to this paragraph (e)  shall  be  revenue  bonds  or
notes.   Such  revenue bonds or notes shall have no claim for
payment other than from revenues of the Agency  derived  from
the  operation of its joint waterworks or water supply system
(including from contracts  for  the  sale  of  water  by  the
Agency)  and  investment  earnings thereon, from bond or note
proceeds and investment earnings thereon, or from such  other
receipts  of  the  Agency  as  the agreement establishing the
Agency may authorize to be pledged to the payment of  revenue
bonds  or  notes, all as and to the extent as provided in the
resolution of the Board of Directors authorizing the issuance
of the revenue bonds or notes.  Revenue bonds or notes issued
by a Municipal Joint Action Water  Agency  pursuant  to  this
paragraph  (e)  shall  not  constitute an indebtedness of the
Agency or of any member municipality, public water  district,
township,  or county within the meaning of any constitutional
or statutory limitation.  It shall be plainly stated on  each
revenue  bond  and  note  that  it  does  not  constitute  an
indebtedness of the Municipal Joint Action Water Agency or of
any  member municipality, public water district, township, or
county within the meaning of any constitutional or  statutory
limitation.
    (ii)  If  the  Agreement  so  provides and subject to the
referendum provided for in clause (iii) of this  subparagraph
4  of  this  paragraph  (e), the Municipal Joint Action Water
Agency may borrow money for corporate purposes on the  credit
of the Municipal Joint Action Water Agency, and issue general
obligation  bonds  therefor,  in such amounts and form and on
such conditions as it shall prescribe, but shall  not  become
indebted  in  any  manner  or  for  any  purpose in an amount
including  existing  indebtedness  in  the  aggregate   which
exceeds  5.75% of the aggregate value of the taxable property
within the boundaries of  the  participating  municipalities,
public  water  districts, townships, and county service areas
within a member county determined by the  governing  body  of
the  county by resolution to be served by the Municipal Joint
Action Water Agency (including any  territory  added  to  the
Agency  after the issuance of such general obligation bonds),
collectively defined as the "Service Area", as equalized  and
assessed  by  the  Department of Revenue and as most recently
available at the time of the issue of said bonds.  Before  or
at   the  time  of  incurring  any  such  general  obligation
indebtedness, the Municipal Joint Action Water  Agency  shall
provide  for  the  collection  of  a direct annual tax, which
shall be unlimited as to rate or amount,  sufficient  to  pay
the interest on such debt as it falls due and also to pay and
discharge  the  principal thereof at maturity, which shall be
within 40 years after the date of issue  thereof.   Such  tax
shall  be  levied  upon and collected from all of the taxable
property within the territorial boundaries  of  such  Service
Area  at  the  time  of the referendum provided for in clause
(iii) and shall be levied upon and collected from all taxable
property within the boundaries of any territory  subsequently
added  to  the  Service  Area.   Dissolution of the Municipal
Joint Action Water Agency for any reason  shall  not  relieve
the  taxable property within such Service Area from liability
for such tax. Liability for such tax for property transferred
to or released from such Service Area shall be determined  in
the  same  manner  as  for  general  obligation bonds of such
county,  if  in  an  unincorporated   area,   and   of   such
municipality, if within the boundaries thereof.  The clerk or
other  officer  of  the  Municipal  Joint Action Water Agency
shall file a certified copy of the resolution or ordinance by
which such bonds are authorized to be issued and such tax  is
levied  with  the  County  Clerk  or  Clerks of the county or
counties containing the Service Area, and such  filing  shall
constitute,  without  the  doing  of  any other act, full and
complete authority for such County Clerk or Clerks to  extend
such  tax for collection upon all the taxable property within
the Service Area subject to such tax in each and every  year,
as  required,  in  amounts sufficient to pay the principal of
and interest on such bonds, as aforesaid, without limit as to
rate or amount.  Such tax shall be  in  addition  to  and  in
excess  of  all  other  taxes  authorized to be levied by the
Municipal Joint  Action  Water  Agency  or  by  such  county,
municipality,   township,  or  public  water  district.   The
issuance of such general obligation bonds shall be subject to
the other provisions of this paragraph (e),  except  for  the
provisions of clause (i) of this subparagraph 4.
    (iii)  No  issue  of  general  obligation  bonds  of  the
Municipal  Joint  Action Water Agency (except bonds to refund
an existing bonded indebtedness) shall be  authorized  unless
the   Municipal  Joint  Action  Water  Agency  certifies  the
proposition of issuing such  bonds  to  the  proper  election
authorities,  who  shall submit the proposition to the voters
in the Service Area at an election  in  accordance  with  the
general  election  law, and the proposition has been approved
by a majority of those voting on the proposition.
    The proposition shall be substantially in  the  following
form:
-------------------------------------------------------------
    Shall general obligation
bonds for the purpose of (state
purpose), in the sum not to
exceed $....(insert amount),                Yes
be issued by the .........           ------------------------
(insert corporate name of the               No
Municipal Joint Action Water
Agency)?
-------------------------------------------------------------
    5.  As  long  as  any bonds or notes of a Municipal Joint
Action Water Agency created pursuant to this Section 3.1  are
outstanding  and  unpaid,  the  Agency shall not terminate or
dissolve and,  except  as  permitted  by  the  resolution  or
resolutions authorizing outstanding bonds or notes, no member
municipality,  public water district, township, or county may
withdraw from the Agency.  While any such bonds or notes  are
outstanding,  all  contracts  for  the  sale  of water by the
Agency to  member  municipalities,  public  water  districts,
townships,   or  counties  shall  be  irrevocable  except  as
permitted by the resolution or resolutions  authorizing  such
bonds  or notes.  The Agency shall establish fees and charges
for its operations sufficient to provide adequate revenues to
meet all of the requirements under  its  various  resolutions
authorizing bonds or notes.
    6.  A  holder of any bond or note issued pursuant to this
paragraph (e) may, in any civil  action,  mandamus  or  other
proceeding,  enforce  and  compel  performance  of all duties
required to be performed by the Agency or such  counties,  as
provided  in  the  authorizing  resolution,  or by any of the
public agencies  contracting  with  the  Agency  to  purchase
water,  including  the  imposition  of  fees and charges, the
collection of sufficient revenues and the proper  application
of  revenues  as  provided  in  this  paragraph  (e)  and the
levying, extension and collection of such taxes.
    7.  In addition, the resolution authorizing any bonds  or
notes issued pursuant to this paragraph (e) may provide for a
pledge,  assignment,  lien  or  security  interest,  for  the
benefit  of  the  holders of any or all bonds or notes of the
Agency, (i) on any or all revenues derived from the operation
of the joint waterworks or  water  supply  system  (including
from contracts for the sale of water) and investment earnings
thereon  or (ii) on funds or accounts securing the payment of
the bonds or notes as provided in the authorizing resolution.
In addition, such a  pledge,  assignment,  lien  or  security
interest  may  be  made  with  respect to any receipts of the
Agency which the agreement establishing the Agency authorizes
it to apply to payment of bonds or notes.  Any  such  pledge,
assignment,  lien  or  security  interest  for the benefit of
holders of bonds or notes shall be valid and binding from the
time the bonds or notes  are  issued,  without  any  physical
delivery  or  further  act, and shall be valid and binding as
against or prior to any claims of any other party having  any
claims of any kind against the Agency irrespective of whether
such  other  parties  have notice of such pledge, assignment,
lien or security interest.
    A  resolution  of  a   Municipal   Joint   Water   Agency
authorizing  the  issuance of bonds or notes pursuant to this
paragraph (e) may provide for the appointment of a  corporate
trustee  with  respect  to  any or all of such bonds or notes
(which trustee may be any trust company or state or  national
bank  having  the  power of a trust company within Illinois).
In that event, the resolution  shall  prescribe  the  rights,
duties  and  powers  of  the  trustee to be exercised for the
benefit of the Agency and the protection of  the  holders  of
such  bonds  or  notes.   The  resolution may provide for the
trustee to hold in trust, invest and use amounts in funds and
accounts  created  as  provided  in  the   resolution.    The
resolution authorizing the bonds or notes may provide for the
assignment  and direct payment to the trustee of amounts owed
by public agencies to the Municipal Joint Action Water Agency
under water sales contracts for application by the trustee to
the purposes for which  such  revenues  are  to  be  used  as
provided  in  this  paragraph  (e)  and  as  provided  in the
authorizing resolution.   Upon  receipt  of  notice  of  such
assignment,  the  public  agency  shall  thereafter  make the
assigned payments directly to such trustee.
    Nothing in this Section authorizes a Joint  Action  Water
Agency  to provide water service directly to residents within
a municipality or in territory within one mile or less of the
corporate limits of a municipality  that  operates  a  public
water supply unless the municipality has consented in writing
to such service being provided.
    Nothing in this Act prohibits a Joint Action Water Agency
from  providing  water  service  to  all  residents of member
municipalities  and  to  all  persons   who   have   executed
pre-annexation agreements with any member municipality.
(Source: P.A. 90-210, eff. 7-25-97; 90-595, eff. 1-1-99.)

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