Full Text of HB3751 100th General Assembly
HB3751 100TH GENERAL ASSEMBLY |
| | 100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018 HB3751 Introduced , by Rep. Martin J. Moylan SYNOPSIS AS INTRODUCED: |
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Amends the Public Construction Bond Act concerning a cash bond or other surety from a builder or developer. Allows a county or municipality to require a cash bond or other surety (instead of requiring the county or municipality to accept a letter of credit or other instrument issued by a financial institution). Eliminates the preemption of home rule powers. Effective immediately.
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| | | FISCAL NOTE ACT MAY APPLY | |
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| 1 | | AN ACT concerning local government.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Public Construction Bond Act is amended by | 5 | | changing Section 3 as follows:
| 6 | | (30 ILCS 550/3)
| 7 | | Sec. 3. Builder or developer cash bond or other surety.
| 8 | | (a) A county or municipality may not require a cash bond, | 9 | | irrevocable
letter of credit, surety bond, or letter of | 10 | | commitment issued by a bank,
savings and loan association, | 11 | | surety, or insurance company from a builder or
developer to
| 12 | | guarantee completion of a project improvement when the builder | 13 | | or developer
has filed with the county or municipal clerk a
| 14 | | current, irrevocable letter of credit, surety bond, or letter | 15 | | of commitment
issued by a bank, savings and loan association, | 16 | | surety, or insurance company,
deemed good and sufficient by the | 17 | | county or
municipality accepting such security, in an amount | 18 | | equal
to or greater than 110% of the amount of the bid on each | 19 | | project improvement .
A county or municipality builder or | 20 | | developer has the option to require utilize a
cash bond, | 21 | | irrevocable letter of credit,
surety bond, or letter of | 22 | | commitment, issued by a bank, savings and loan
association, | 23 | | surety, or insurance company, deemed good and
sufficient
by the |
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| 1 | | county or municipality, to
satisfy any cash bond requirement | 2 | | established by a county or municipality.
Except for a | 3 | | municipality or county with a population of 1,000,000 or more,
| 4 | | the county or municipality must approve and deem a surety or
| 5 | | insurance company good and sufficient for the purposes set | 6 | | forth in this
Section if the surety or insurance company is | 7 | | authorized by the
Illinois Department of Insurance to sell and | 8 | | issue sureties in the State of
Illinois.
| 9 | | (b) If a county or municipality receives a cash bond, | 10 | | irrevocable letter
of credit, or surety bond from a builder or
| 11 | | developer to
guarantee completion of a project improvement, the | 12 | | county or municipality shall
(i) register
the bond under
the | 13 | | address of the project and the construction permit number and | 14 | | (ii) give the
builder or developer a receipt for the bond. The | 15 | | county or municipality shall
establish and
maintain a separate | 16 | | account for all cash bonds received from builders and
| 17 | | developers to guarantee completion of a project improvement.
| 18 | | (c) The county or municipality shall refund a cash bond to | 19 | | a builder or
developer, or release the irrevocable letter of | 20 | | credit or surety bond,
within
60 days after the builder or | 21 | | developer notifies the county or municipality in
writing of the
| 22 | | completion of the project improvement for which the bond
was | 23 | | required.
For these purposes, "completion" means that the | 24 | | county or municipality has
determined
that the project | 25 | | improvement for which the bond was required is complete or a
| 26 | | licensed engineer or licensed architect has certified to the |
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| 1 | | builder or
developer and the county or municipality that the | 2 | | project improvement has been
completed to the
applicable codes | 3 | | and ordinances.
The county or municipality shall pay interest | 4 | | to the builder or developer,
beginning 60 days
after the | 5 | | builder or developer notifies the county or municipality in | 6 | | writing
of the completion
of the
project improvement, on any | 7 | | bond not refunded to a builder or developer, at
the rate of 1%
| 8 | | per month.
| 9 | | (d) (Blank). A home rule county or municipality may not | 10 | | require or maintain cash
bonds, irrevocable
letters of credit, | 11 | | surety bonds, or letters of commitment issued by a bank,
| 12 | | savings and loan association, surety, or insurance company
from | 13 | | builders
or developers in a manner inconsistent with this | 14 | | Section. This Section supersedes
and controls over other | 15 | | provisions of the Counties Code or
Illinois Municipal Code as | 16 | | they apply to and guarantee completion of a project
improvement | 17 | | that is required by the county or municipality, regardless of
| 18 | | whether the project improvement is a condition of annexation | 19 | | agreements.
This Section is a
denial and limitation under | 20 | | subsection (i) of Section
6 of Article VII of the Illinois | 21 | | Constitution on the concurrent exercise by a
home rule
county | 22 | | or municipality of powers and functions exercised by the State.
| 23 | | (Source: P.A. 96-1000, eff. 7-2-10.)
| 24 | | Section 99. Effective date. This Act takes effect upon | 25 | | becoming law.
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