HB0574 EngrossedLRB099 04429 JLK 24457 b

1    AN ACT concerning State government.
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4    Section 1. Short title. This Act may be cited as the
5Illinois Business and Economic Development Corporation Act.
6    Section 3. Findings. The General Assembly finds that
7targeted efforts to promote and foster business growth, job
8creation, and tourism are necessary for economic growth in
9Illinois to provide more prosperity and opportunities for
10Illinois residents. As both the public and private sectors have
11a shared interest in fostering the economic vitality of the
12State, it is the purpose of this Act to implement economic
13development policy in the State by means of collaboration
14between the government and a not-for-profit corporation.
15    Section 5. Definitions. For the purposes of this Act:
16    "Board" means the board of directors of the corporation.
17    "Chief Executive Officer" means the chief executive
18officer of the corporation.
19    "Conflict party" means a director, officer, or employee of
20the corporation; the spouse of a director, officer, or employee
21of the corporation; or an immediate family member of a
22director, officer, or employee of the corporation residing in



HB0574 Engrossed- 2 -LRB099 04429 JLK 24457 b

1the same residence as the director, officer or employee.
2    "Corporation" means the Illinois Business and Economic
3Development Corporation incorporated by the Department
4pursuant to Section 10.
5    "Department" means the Illinois Department of Commerce and
6Economic Opportunity.
7    "Director" means the Director of Commerce and Economic
9    Section 10. Creation of the Illinois Business and Economic
10Development Corporation.
11    (a) The General Assembly authorizes the Department, in
12accordance with Section 10 of the State Agency Entity Creation
13Act, to incorporate the Illinois Business and Economic
14Development Corporation as a not-for-profit corporation
15pursuant to the General Not For Profit Corporation Act of 1986.
16    (b) The purpose of the corporation shall be to operate
17exclusively for charitable purposes within the government, by
18promoting the economic development and well-being of the State.
19The corporation shall focus on business development, small and
20minority-owned business incubation, trade and investment,
21tourism and film. The corporation shall:
22        (1) develop best practices for economic development in
23    consultation with the Department;
24        (2) enter into grant agreements with the Department and
25    sub-grants with other persons and entities, subject to



HB0574 Engrossed- 3 -LRB099 04429 JLK 24457 b

1    Department approval;
2        (3) maintain and develop economic data and research
3    that is beneficial to business development in the State;
4        (4) maintain and develop information about specific
5    statewide and regional economic incentives and benefits
6    that may be available to a business to expand within, or
7    relocate to, the State; and provide such information to
8    prospective businesses;
9        (5) formulate and pursue programs and local
10    partnerships for encouraging the location of new
11    businesses in the State and for retaining and fostering the
12    growth of existing businesses;
13        (6) negotiate tax incentives with private businesses,
14    subject to Department approval; and
15        (7) cooperate with and provide information to State
16    agencies, local governments, community colleges, and State
17    universities on economic development matters.
18    (c) For the purposes described in this Act, the corporation
19shall collaborate with the Department; with other State
20agencies, authorities, boards, and commissions whose programs
21and activities significantly affect economic activity in the
22State as appropriate; and with local and regional economic
23development organizations, local elected officials,
24community-based organizations, service delivery providers, and
25other organizations whose programs and activities
26significantly affect economic activity. The Department and



HB0574 Engrossed- 4 -LRB099 04429 JLK 24457 b

1each other State agency, authority, board, or commission with
2which the corporation seeks to collaborate shall assist the
3corporation in carrying out its purposes as directed by the
5    (d) The corporation shall make every effort to focus on
6small business development and incentives and programs
7designed to assist minority-owned and women-owned businesses
8and businesses that will create jobs in areas with high
9unemployment or poverty.
10    (e) The corporation shall not be considered, in whole or in
11part, an agency, political subdivision, or instrumentality of
12the State. The corporation shall not exercise any sovereign
13power of the State. Employees and officers of the corporation
14shall not be considered employees or officers of the State or
15subject to the Personnel Code or other laws applicable to State
16employees and officers. The corporation does not have authority
17to pledge the credit of the State; the State shall not be
18liable for the debts or obligations of the corporation; and all
19debts and obligations of the corporation shall be payable
20solely from the corporation's funds.
21    (f) The corporation shall have such powers, rights, and
22obligations as are conferred upon a not-for-profit corporation
23under the General Not For Profit Corporation Act of 1986,
24including to accept grants, loans, or other amounts from the
25State, the federal government, or other persons; to enter into
26contracts; and to employ personnel and other agents.



HB0574 Engrossed- 5 -LRB099 04429 JLK 24457 b

1    (g) The corporation shall be established, maintained, and
2operated so that donations and bequests to the corporation
3qualify as tax deductible under State income tax laws and
4Sections 170(c)(2) and 501(c)(3) of the Internal Revenue Code.
5    (h) The articles of incorporation and bylaws of the
6corporation shall provide for (1) governance and efficient
7management of the corporation, (2) a board of directors
8satisfying the requirements of Section 15, (3) a conflict of
9interest policy satisfying the requirements of Section 30, and
10(4) financial operations of the corporation, including the
11authority to receive and expend funds from public and private
12sources and to use its property, money, and other resources for
13the purposes of the corporation.
14    Section 15. Board of directors and Chief Executive Officer
15of the corporation.
16    (a) The affairs of the corporation shall be managed by or
17under the direction of the board of directors of the
19    (b) The board shall comprise 16 directors as follows:
20        (1) The Governor or his or designee shall be a director
21    ex officio and serve as chairperson of the board.
22        (2) The Governor shall appoint 11 directors, including
23    (i) one director with professional experience in finance,
24    insurance, or investment banking, (ii) one director with
25    professional experience in small business development,



HB0574 Engrossed- 6 -LRB099 04429 JLK 24457 b

1    (iii) one director with professional experience in the
2    tourism or hospitality industry, and (iv) eight directors
3    who are actively employed in the private, for-profit sector
4    or who otherwise have substantial experience in economic
5    development. Of those eight directors described in clause
6    (iv), there shall be at least one director from each
7    industry cluster as identified to the Governor by the
8    Director. Of the 11 directors appointed pursuant to this
9    paragraph, at least 6 directors shall be representatives of
10    minority-owned and women-owned businesses.
11        (3) The Speaker and Minority Leader of the House of
12    Representatives and the President and Minority Leader of
13    the Senate each shall appoint one director who is employed
14    in, or retired from employment in, a private business,
15    not-for-profit organization, or academic organization.
16    (c) To facilitate communication and cooperation between
17the corporation and State agencies involved in economic
18development, the director or head of each of the following
19agencies shall serve as a non-voting, non-director member of
20the board: Department of Commerce and Economic Opportunity,
21Department of Agriculture, Department of Natural Resources,
22Department of Financial and Professional Regulation, Illinois
23Finance Authority, Department of Revenue, Department of Labor,
24Department of Veterans' Affairs, Department of Central
25Management Services, Illinois Environmental Protection Agency,
26and Department of Employment Security.



HB0574 Engrossed- 7 -LRB099 04429 JLK 24457 b

1    (d) Except for the Governor or his or her designee, each
2director shall serve a term of three years. The articles of
3incorporation or bylaws shall divide the other 15 directors
4into three equal classes, with the terms of one class of
5directors expiring each year. In the event of a vacancy on the
6Board, the Governor shall appoint a replacement member within
760 days. In the event of a position appointed by a legislative
8leader, the leader making the original appointment shall fill
9the vacancy within 60 days.
10    (e) The Governor shall select an initial Chief Executive
11Officer of the corporation, subject to confirmation by a
12majority of members of the board. After the initial Chief
13Executive Officer, each subsequent Chief Executive Officer
14shall be selected and confirmed by a majority vote of the
16    (f) The members of the board are prohibited from making any
17contributions to any political committee established to
18support the Governor or any candidate for Governor.
19    Section 20. Office of Economic Development and Tourism.
20Within the Department, there shall be created a new division
21called the Office of Economic Development and Tourism for the
22purpose of collaborating with the corporation, issuing grants
23and transferring funds to the corporation, subject to
24appropriation, and being responsible for the following
25functions of the Department: business development;



HB0574 Engrossed- 8 -LRB099 04429 JLK 24457 b

1entrepreneurship, innovation, and technology; trade and
2investment; and tourism and film. The director of that office
3shall report directly to the Director.
4    Section 25. Accountability and transparency.
5    (a) Within the Office of the Director there is created a
6new division called the Office of Accountability and
7Transparency. Such division shall be responsible for
8monitoring all grants made by the Department; for ensuring
9compliance by the Department and its grantees, including the
10corporation, with all applicable laws and grant terms and
11conditions; and for ensuring transparency in the Department's
12grant-making and other activities.
13    (b) With respect to any grant agreement entered into
14between the corporation and the Department, the corporation
15shall comply with the following provisions:
16        (1) For the purposes of the Freedom of Information Act,
17    the corporation shall be considered a contractor
18    performing a governmental function on behalf of the
19    Department in accordance with subsection (2) of Section 7
20    of such Act, whether the corporation receives a grant from
21    or enters into a contract with the Department.
22        (2) The corporation shall post copies of minutes of its
23    board meetings on its publicly-accessible website. Any
24    redactions shall be limited to information exempt from
25    disclosure pursuant to subsection (1) of Section 7 of the



HB0574 Engrossed- 9 -LRB099 04429 JLK 24457 b

1    Freedom of Information Act or other applicable law.
2        (3) The corporation shall post copies of all final
3    grant agreements and tax incentives on its
4    publicly-accessible website within 10 business days of the
5    later of the execution of the final agreement or incentive
6    or the public announcement of the final agreement or
7    incentive. Any redactions shall be limited to information
8    exempt from disclosure pursuant to subsection (1) of
9    Section 7 of the Freedom of Information Act or other
10    applicable law.
11        (4) The corporation shall develop procedures,
12    standards, and objectives for evaluating all sub-grant
13    applicants and sub-grants awarded to ensure that State
14    funds spent by the corporation and its sub-grantees
15    optimize return on investment for Illinois taxpayers. Such
16    procedures, standards, and objectives shall be disclosed
17    on the corporation's publicly-accessible website.
18        (5) The corporation shall assess and report its efforts
19    and results to the public and the Department's Office of
20    Accountability and Transparency. In addition, the
21    corporation shall comply with all grant monitoring
22    procedures issued by the Department for the monitoring of
23    grants of State and federal funds.
24        (6) The corporation shall conduct an annual audit
25    performed by a certified public accountant in accordance
26    with generally accepted accounting principles. Such audit



HB0574 Engrossed- 10 -LRB099 04429 JLK 24457 b

1    shall be filed with the Department's Office of
2    Accountability and Transparency and made available to the
3    public.
4        (7) The corporation shall be subject to bi-annual
5    audits by the Auditor General.
6        (8) The corporation shall submit an annual report by
7    March 31 of each year to the Governor, the General
8    Assembly, and the Department's Office of Accountability
9    and Transparency that describes the corporation's
10    operations and activities during the prior fiscal year,
11    including: (A) the corporation's complete, audited
12    financial statements, including a description of the
13    corporation's financial conditions and operations and a
14    detailed account of how private funds were utilized versus
15    public funds; (B) a listing of all public sources of funds
16    received by the corporation; (C) a listing of all private
17    sources of funds received by the corporation; (D) a listing
18    of all firms and individuals who provided assistance or
19    resources to the corporation without compensation,
20    including the approximate value of the assistance or
21    resources provided; (E) a description of how the operations
22    and activities of the corporation serve the interests of
23    the State and promote economic development; (F) an analysis
24    of the State's return on investment; and (G) a listing of
25    all conflicts of interest from directors, officers, and
26    employees identified in the board meeting minutes.



HB0574 Engrossed- 11 -LRB099 04429 JLK 24457 b

1        (9) The corporation shall comply with all applicable
2    State and federal laws, including all applicable terms of
3    the Grant Accountability and Transparency Act. For
4    purposes of the Illinois Grant Funds Recovery Act, all
5    sub-grants of grant funds made by the corporation shall be
6    treated as grant funds in accordance with Section 12 of
7    that Act.
8    Section 30. Conflicts of interest.
9    (a) In the conduct of their service to the corporation,
10directors, officers, and employees of the corporation shall
11behave ethically and in the best interests of the State and
12avoid actual and potential conflicts of interest.
13    (b) The corporation shall adopt and maintain a
14comprehensive conflicts of interest policy. Such policy shall
15include, without limitation, the following:
16        (1) Any pecuniary interest held by or for a conflict
17    party in a grant from or contract with the corporation or a
18    tax incentive from the Department shall be disclosed in
19    writing and identified in the minutes of the board. Such
20    conflict must be disclosed before the approval of any
21    grant, contract, or incentive.
22        (2) A conflict party who holds a pecuniary interest in
23    a grant from or contract with the corporation or a tax
24    incentive from the Department, or for whom such an interest
25    is held, shall not participate in any corporate action,



HB0574 Engrossed- 12 -LRB099 04429 JLK 24457 b

1    including deliberations on such action, with respect to
2    such grant, contract, or incentive.
3        (3) A conflict party may not acquire a pecuniary
4    interest in a grant from or contract with the corporation
5    or a tax incentive from the Department during the time that
6    the conflict party (or the spouse or immediate family
7    member of the conflict party) serves as a director,
8    officer, or employee of the corporation and for one year
9    after termination of such service.
10        (4) The corporation shall not enter into any grant or
11    contract with any entity in which a conflict party is
12    entitled to receive more than 7.5%, or in which a conflict
13    party together with his or her spouse and immediate family
14    members residing in his or her residence are entitled to
15    receive more than 15%, of the total distributable income of
16    the entity. For purposes of this paragraph (4),
17    "distributable income" means the income of a company after
18    payment of all expenses, including employee salary and
19    bonus, and retained earnings, which is distributed to those
20    entitled to receive a share of the income. In the case of a
21    for-profit corporation, "distributable" income means
22    dividends. When calculating entitlement to distributable
23    income the entitlement shall be determined at the end of
24    the company's most recent fiscal year.
25        (5) The board of directors shall determine appropriate
26    penalties for any violations of these provisions.



HB0574 Engrossed- 13 -LRB099 04429 JLK 24457 b

1    Section 33. Prohibition on political contributions. Any
2business entity whose cumulative pending applications for
3grants or tax incentives or previously approved grants or tax
4incentives in the aggregate value more than $50,000, and any
5affiliated entities or affiliated persons of such business
6entity, are prohibited from making any contributions to any
7political committees established to support the Governor or any
8candidate for Governor.
9    Section 35. Fundraising. The corporation shall raise and
10accept funds from private donors to support its economic
11development efforts and other operations.
12    Section 40. Repeal. This Act is repealed 3 years after the
13effective date of this Act.
14    (20 ILCS 605/605-300 rep.)
15    Section 90. The Department of Commerce and Economic
16Opportunity Law of the Civil Administrative Code of Illinois is
17amended by repealing Section 605-300.