Illinois General Assembly - Full Text of SB0083
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Full Text of SB0083  97th General Assembly


Sen. A. J. Wilhelmi

Filed: 2/25/2011





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2    AMENDMENT NO. ______. Amend Senate Bill 83 by replacing
3everything after the enacting clause with the following:
4    "Section 5. The Illinois Municipal Code is amended by
5changing Section 11-124-5 as follows:
6    (65 ILCS 5/11-124-5)
7    Sec. 11-124-5. Acquisition of water systems by eminent
9    (a) In addition to other provisions providing for the
10acquisition of water systems or water works, whenever a public
11utility subject to the Public Utilities Act utilizes public
12property (including, but not limited to, right-of-way) of a
13municipality for the installation or maintenance of all or part
14of its water distribution system, the municipality has the
15right to exercise eminent domain to acquire all or part of the
16water system, in accordance with this Section. Unless it



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1complies with the provisions set forth in this Section, a
2municipality is not permitted to acquire by eminent domain that
3portion of a system located in another incorporated
4municipality without agreement of that municipality, but this
5provision shall not prevent the acquisition of that portion of
6the water system existing within the acquiring municipality.
7    (b) Where a water system that is owned by a public utility
8(as defined in the Public 16 Utilities Act) provides water to
9customers located in 2 or more municipalities, the system may
10be acquired by a majority either or all of the municipalities
11by eminent domain if there is in existence an intergovernmental
12agreement between the municipalities served providing for
13acquisition. If the system is to be acquired by more than one
14municipality, then there must be an intergovernmental
15agreement in existence between the acquiring municipalities
16providing for the acquisition.
17    (c) If a water system that is owned by a public utility
18provides water to customers located in one or more
19municipalities and also to customers in an unincorporated area
20and if at least 70% of the customers of the system or portion
21thereof are located within the municipality or municipalities,
22then the system, or portion thereof as determined by the
23corporate authorities, may be acquired, using eminent domain or
24otherwise, by either a municipality under subsection (a) or an
25entity created by agreement between municipalities where at
26least 70% of the customers reside. For the purposes of



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1determining "customers of the system", only retail customers
2directly billed by the company shall be included in the
3computation. The number of customers of the system most
4recently reported to the Illinois Commerce Commission for any
5calendar year preceding the year a resolution is passed by a
6municipality or municipalities expressing preliminary intent
7to purchase the water system or portion thereof shall be
8presumed to be the total number of customers within the system.
9The public utility shall provide information relative to the
10number of customers within each municipality and within the
11system within 60 days after any such request by a municipality.
12    (d) In the case of acquisition by a municipality or
13municipalities or a public entity created by law to own or
14operate a water system under this Section, service and water
15supply must be provided to persons who are customers of the
16system on the effective date of this amendatory Act of the 94th
17General Assembly without discrimination based on whether the
18customer is located within or outside of the boundaries of the
19acquiring municipality or municipalities or entity, and a
20supply contract existing on the effective date of this
21amendatory Act of the 94th General Assembly must be honored by
22an acquiring municipality, municipalities, or entity according
23to the terms so long as the agreement does not conflict with
24any other existing agreement.
25    (e) For the purposes of this Section, "system" includes all
26assets reasonably necessary to provide water service to a



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1contiguous or compact geographical service area or to an area
2served by a common pipeline and include, but are not limited
3to, interests in real estate, all wells, pipes, treatment
4plants, pumps and other physical apparatus, data and records of
5facilities and customers, fire hydrants, equipment, or
6vehicles and also includes service agreements and obligations
7derived from use of the assets, whether or not the assets are
8contiguous to the municipality, municipalities, or entity
9created for the purpose of owning or operating a water system.
10    (f) Before making a good faith offer, a municipality may
11pass a resolution of intent to study the feasibility of
12purchasing or exercising its power of eminent domain to acquire
13any water system or water works, sewer system or sewer works,
14or combined water and sewer system or works, or part thereof.
15Upon the passage of such a resolution, the municipality shall
16have the right to review and inspect all financial and other
17records, and both corporeal and incorporeal assets of such
18utility related to the condition and the operation of the
19system or works, or part thereof, as part of the study and
20determination of feasibility of the proposed acquisition by
21purchase or exercise of the power of eminent domain, and the
22utility shall make knowledgeable persons who have access to all
23relevant facts and information regarding the subject system or
24works available to answer inquiries related to the study and
26    The right to review and inspect shall be upon reasonable



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1notice to the utility, with reasonable inspection and review
2time limitations and reasonable response times for production,
3copying, and answer. In addition, the utility may utilize a
4reasonable security protocol for personnel on the
5municipality's physical inspection team.
6    In the absence of other agreement, the utility must respond
7to any notice by the municipality concerning its review and
8inspection within 21 days after receiving the notice. The
9review and inspection of the assets of the company shall be
10over such period of time and carried out in such manner as is
11reasonable under the circumstances.
12    Information requested that is not privileged or protected
13from discovery under the Illinois Code of Civil Procedure but
14is reasonably claimed to be proprietary, including, without
15limitation, information that constitutes trade secrets or
16information that involves system security concerns, shall be
17provided, but shall not be considered a public record and shall
18be kept confidential by the municipality.
19    In addition, the municipality must, upon request,
20reimburse the utility for the actual, reasonable costs and
21expenses, excluding attorneys' fees, incurred by the utility as
22a result of the municipality's inspection and requests for
23information. Upon written request, the utility shall issue a
24statement itemizing, with reasonable detail, the costs and
25expenses for which reimbursement is sought by the utility.
26Where such written request for a statement has been made, no



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1payment shall be required until 30 days after receipt of the
2statement. Such reimbursement by the municipality shall be
3considered income for purposes of any rate proceeding or other
4financial request before the Illinois Commerce Commission by
5the utility.
6    The municipality and the utility shall cooperate to resolve
7any dispute arising under this subsection. In the event the
8dispute under this subsection cannot be resolved, either party
9may request relief from the circuit court in any county in
10which the water system is located, with the prevailing party to
11be awarded such relief as the court deems appropriate under the
12discovery abuse sanctions currently set forth in the Illinois
13Code of Civil Procedure.
14    The municipality's right to inspect physical assets and
15records in connection with the purpose of this Section shall
16not be exercised with respect to any system more than one time
17during a 5-year period, unless a substantial change in the size
18of the system or condition of the operating assets of the
19system has occurred since the previous inspection. Rights under
20franchise agreements and other agreements or statutory or
21regulatory provisions are not limited by this Section and are
23    The passage of time between an inspection of the utilities
24and physical assets and the making of a good faith offer or
25initiation of an eminent domain action because of the limit
26placed on inspections by this subsection shall not be used as a



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1basis for challenging the good faith of any offer or be used as
2the basis for attacking any appraisal, expert, argument, or
3position before a court related to an acquisition by purchase
4or eminent domain.
5    (g) Notwithstanding any other provision of law, the
6Illinois Commerce Commission has no approval authority of any
7eminent domain action brought by any governmental entity or
8combination of such entities to acquire water systems or water
10    (h) The provisions of this Section are severable under
11Section 1.31 of the Statute on Statutes.
12    (i) This Section does not apply to any public utility
13company that, on January 1, 2006, supplied a total of 70,000 or
14fewer meter connections in the State unless and until (i) that
15public utility company receives approval from the Illinois
16Commerce Commission under Section 7-204 of the Public Utilities
17Act for the reorganization of the public utility company or
18(ii) the majority control of the company changes through a
19stock sale, a sale of assets, a merger (other than an internal
20reorganization) or otherwise. For the purpose of this Section,
21"public utility company" means the public utility providing
22water service and includes any of its corporate parents,
23subsidiaries, or affiliates possessing a franchised water
24service in the State.
25    (j) Any water system acquired by a municipality or
26municipalities under this Section shall have all work on the



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1acquired system performed by employees who are members of a
2collective bargaining unit or by contractors whose employees
3are members of a collective bargaining unit.
4(Source: P.A. 94-1007, eff. 1-1-07.)
5    Section 99. Effective date. This Act takes effect upon
6becoming law.".