SB2301 100TH GENERAL ASSEMBLY

LRB100 16491 KTG 31713 b

100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
SB2301

Introduced 1/10/2018, by Sen. Antonio Muņoz

SYNOPSIS AS INTRODUCED:

805 ILCS 105/103.05	from Ch. 32, par. 103.05
805 ILCS 105/108.70	from Ch. 32, par. 108.70

Amends the General Not For Profit Corporation Act of 1986. Includes the purpose of ownership and operation of a public wastewater service or system on a mutual or cooperative basis to the list of purposes for which a not-for-profit corporation may be organized under the Act. Exempts any director of a corporation that is organized for the purpose of (i) operating water supply facilities for drinking and general domestic use on a mutual or cooperative basis or (ii) ownership and operation of a public wastewater service or system on a mutual or cooperative basis from liability for damages resulting from the exercise of judgment or discretion in connection with his or her duties or responsibilities, with certain exceptions.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning business.

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

Section 5. The General Not For Profit Corporation Act of 1986 is amended by changing Sections 103.05 and 108.70 as follows:

(805 ILCS 105/103.05) (from Ch. 32, par. 103.05)

Sec. 103.05. Purposes and authority of corporations; particular purposes; exemptions.

(a) Not-for-profit corporations may be organized under this Act for any one or more of the following or similar purposes:

(1) Charitable.

(2) Benevolent.

(3) Eleemosynary.

(4) Educational.

(5) Civic.

(6) Patriotic.

(7) Political.

(8) Religious.

(9) Social.

(10) Literary.

(11) Athletic.

(12) Scientific.

(13) Research.

(14) Agricultural.

(15) Horticultural.

(16) Soil improvement.

(17) Crop improvement.

(18) Livestock or poultry improvement.

(19) Professional, commercial, industrial, or trade association.

(20) Promoting the development, establishment, or expansion of industries.

(21) Electrification on a cooperative basis.

(22) Telephone service on a mutual or cooperative basis.

(23) Ownership and operation of water supply facilities for drinking and general domestic use on a mutual or cooperative basis.

(24) Ownership or administration of residential property on a cooperative basis.

(25) Administration and operation of property owned on a condominium basis or by a homeowner association.

(26) Administration and operation of an organization on a cooperative basis producing or furnishing goods, services, or facilities primarily for the benefit of its members who are consumers of those goods, services, or facilities.

(27) Operation of a community mental health board or center organized pursuant to the Community Mental Health Act for the purpose of providing direct patient services.

(28) Provision of debt management services as authorized by the Debt Management Service Act.

(29) Promotion, operation, and administration of a ridesharing arrangement as defined in Section 1-176.1 of the Illinois Vehicle Code.

(30) The administration and operation of an organization for the purpose of assisting low-income consumers in the acquisition of utility and telephone services.

(31) Any purpose permitted to be exempt from taxation under Sections 501(c) or 501(d) of the United States Internal Revenue Code, as now in or hereafter amended.

(32) Any purpose that would qualify for tax-deductible gifts under the Section 170(c) of the United States Internal Revenue Code, as now or hereafter amended. Any such purpose is deemed to be charitable under subsection (a)(1) of this Section.

(33) Furnishing of natural gas on a cooperative basis.

(34) Ownership and operation of agriculture-based biogas (anaerobic digester) systems on a cooperative basis including the marketing and sale of products produced from these, including but not limited to methane gas, electricity, and compost.

(35) Ownership and operation of a public wastewater service or system on a mutual or cooperative basis.

(b) A corporation may be organized hereunder to serve in an area that adjoins or borders (except for any intervening natural watercourse) an area located in an adjoining state intended to be similarly served, and the corporation may join any corporation created by the adjoining state having an identical purpose and organized as a not-for-profit corporation. Whenever any corporation organized under this Act so joins with a foreign corporation having an identical purpose, the corporation shall be permitted to do business in Illinois as one corporation; provided (1) that the name, bylaw provisions, officers, and directors of each corporation are identical, (2) that the foreign corporation complies with the provisions of this Act relating to the admission of foreign corporation, and (3) that the Illinois corporation files a statement with the Secretary of State indicating that it has joined with a foreign corporation setting forth the name thereof and the state of its incorporation.

(Source: P.A. 98-317, eff. 8-12-13.)

(805 ILCS 105/108.70) (from Ch. 32, par. 108.70)

Sec. 108.70. Limited Liability of directors, officers, board members, and persons who serve without compensation.

(a) No director or officer serving without compensation, other than reimbursement for actual expenses, of a corporation organized under this Act or any predecessor Act and exempt, or qualified for exemption, from taxation pursuant to Section 501(c) of the Internal Revenue Code of 1986, as amended, shall be liable, and no cause of action may be brought, for damages resulting from the exercise of judgment or discretion in connection with the duties or responsibilities of such director or officer unless the act or omission involved willful or wanton conduct.

(b) No director of a corporation organized under this Act or any predecessor Act for the purposes identified in items (14), (19), (21), and (22), 23, and 35 of subsection (a) of Section 103.05 of this Act, and exempt or qualified for exemption from taxation pursuant to Section 501(c) of the Internal Revenue Code of 1986, as amended, shall be liable, and no cause of action may be brought for damages resulting from the exercise of judgment or discretion in connection with the duties or responsibilities of such director, unless: (1) such director earns in excess of $25,000 per year from his duties as director, other than reimbursement for actual expenses; or (2) the act or omission involved willful or wanton conduct.

(b-5) Except for willful and wanton conduct, no volunteer board member serving without compensation, other than reimbursement for actual expenses, of a corporation organized under this Act or any predecessor Act and exempt, or qualified for exemption, from taxation pursuant to Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, shall be liable, and no action may be brought, for damages resulting from any action of the executive director concerning the false reporting of or intentional tampering with financial records of the organization, where the actions of the executive director result in legal action.

This subsection (b-5) shall not apply to any action taken by the Attorney General (i) in the exercise of his or her common law or statutory power and duty to protect charitable assets or (ii) in the exercise of his or her authority to enforce the laws of this State that apply to trustees of a charity, as that term is defined in the Charitable Trust Act and the Solicitation for Charity Act.

(c) No person who, without compensation other than reimbursement for actual expenses, renders service to or for a corporation organized under this Act or any predecessor Act and exempt or qualified for exemption from taxation pursuant to Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, shall be liable, and no cause of action may be brought, for damages resulting from an act or omission in rendering such services, unless the act or omission involved willful or wanton conduct.

(d) (Blank).

(e) Nothing in this Section is intended to bar any cause of action against the corporation or change the liability of the corporation arising out of an act or omission of any director, officer or person exempt from liability for negligence under this Section.

(Source: P.A. 95-342, eff. 1-1-08; 96-649, eff. 1-1-10.)