70 ILCS 2805/27.1

(70 ILCS 2805/27.1) (from Ch. 42, par. 438.1)

Sec. 27.1. Special service areas.

(a) A sanitary district organized under this Act may provide special services limited to the construction, maintenance, alteration, and extension of the district's drains, sewers, laterals, and other necessary adjuncts, including pumps and pumping stations, in any special service area within the district. The district may levy a tax to provide those special services or to provide for the payment of debt incurred to provide those special services in accordance with this Act.

(b) The manner of providing special services and of levying the tax authorized by subsection (a) shall be as provided in this Section.

(c) "Special Service Area" means a contiguous area within a district in which special governmental services are provided in addition to those services provided generally throughout the district, the cost of those special services to be paid from revenues collected from taxes levied or imposed upon property within that area. Territory is "contiguous" for purposes of this Section even though certain completely surrounded portions of the territory are excluded from the special service area. A district may create a special service area within a municipality or municipalities when the municipality or municipalities consent to the creation of the special service area. A district may create a special service area within the unincorporated area of a county when the county consents to the creation of the special service area.

(d) The corporate authorities of the district shall be the governing body of the special service area.

(e) Taxes may be levied or imposed by the district in the special service area at a rate or amount of tax sufficient to produce revenues required to provide the special services. Before the first levy of taxes in the special service area, notice shall be given and hearing shall be held under the provisions of subsections (f) and (g). For purposes of this subsection the notice shall include:

(1) the time and place of hearing;

(2) the boundaries of the area by legal description and by street location, where possible;

(3) a notification that all interested persons, including all persons owning taxable real property located within the special service area, will be given an opportunity to be heard at the hearing regarding the tax levy and an opportunity to file objections to the amount of the tax levy if the tax is a tax upon their property; and

(4) the maximum rate of taxes to be extended in any year and may include a maximum number of years the taxes will be levied.

After the first levy, taxes may be extended against the special service area for the services specified without additional hearings, provided the taxes shall not exceed the rate specified in the notice and, if a maximum number of years is specified in the notice, the taxes shall not be extended for a longer period. Tax rates may be increased and the period specified may be extended, provided notice is given and new public hearings are held in accordance with subsections (f) and (g).

(f) Before or within 60 days after the adoption of the ordinance proposing the establishment of a special service area, the district shall fix a time and a place for a public hearing. Notice of the hearing shall be given by publication and mailing. Notice by publication shall be given by publication at least once not less than 15 days before the hearing in a newspaper of general circulation within the district. Notice by mailing shall be given by depositing the notice in the United States mails addressed to the person or persons in whose name the general taxes for the last preceding year were paid on each lot, block, tract, or parcel of land lying within the special service area. The notice shall be mailed not less than 10 days before the time set for the public hearing. In the event taxes for the last preceding year were not paid, the notice shall be sent to the person last listed on the tax rolls before that year as the owner of the property.

(g) At the public hearing any interested person, including all persons owning taxable real property located within the proposed special service area, may file with the district clerk written objections to and may be heard orally in respect to any issues embodied in the notice. The district shall hear and determine all protests and objections at the hearing, and the hearing may be adjourned to another date without further notice other than a motion to be entered upon the minutes fixing the time and place of its adjournment. At the public hearing or at the first regular meeting of the corporate authorities thereafter, the district may delete area from the special service area, except that the special service area must still be a contiguous area as provided in subsection (c).

(h) Bonds secured by the full faith and credit of the area included in the special service area may be issued for providing the special services. Bonds, when so issued, shall be retired by the levy of taxes, in addition to the taxes specified in subsection (e), against all of the taxable real property included in the area as provided in the ordinance authorizing the issuance of the bonds or by the imposition of another tax within the special service area. The county clerk shall annually extend taxes against all of the taxable property situated in the county and contained in the special service area in amounts sufficient to pay maturing principal and interest of those bonds without limitation as to rate or amount and in addition to and in excess of any taxes that may now or hereafter be authorized to be levied by the district. Before the issuance of bonds, notice shall be given and a hearing shall be held under the provisions of subsections (f) and (g). For purposes of this subsection a notice shall include:

(1) the time and place of hearing;

(2) the boundaries of the area by legal description and by street location, where possible;

(3) a notification that all interested persons, including all persons owning taxable real property located within the special service area, will be given an opportunity to be heard at the hearing regarding the issuance of the bonds and an opportunity to file objections to the issuance of the bonds; and

(4) the maximum amount of bonds proposed to be issued, the maximum period of time over which the bonds shall be retired, and the maximum interest rate the bonds shall bear.

The question of the creation of a special service area, the levy or imposition of a tax in the special service area, and the issuance of bonds for providing special services may all be considered together at one hearing.

Any bonds issued shall not exceed the number of bonds, the interest rate, and the period of extension set forth in the notice, unless an additional hearing is held. No bonds issued under this Section shall be regarded as indebtedness of the district for the purpose of any limitation imposed by any law.

(i) Boundaries of a special service area may be enlarged, but only after hearing and notice as provided in subsections (f) and (g), the notice to be served in the original area of the special service area and in any areas proposed to be added to the special service area, except where the property being added represents less than 5% of the assessed valuation of the entire original area, as determined by the clerk of the county wherein the land is located, then the notice by mailing requirement of subsection (f) shall be limited only to the area to be added and not to the original special service area. The property added to the area shall be subject to all taxes levied after that property becomes a part of the area and shall become additional security for bonded indebtedness outstanding at the time the property is added to the area.

(j) If a petition signed by at least 51% of the electors residing within the special service area and by at least 51% of the owners of record of the land included within the boundaries of the special service area is filed with the district clerk within 60 days following the final adjournment of the public hearing objecting to the creation of the special service area, the enlargement of the area, the levy or imposition of a tax, or the issuance of bonds for the provision of special services to the area, or to a proposed increase in the tax rate, no such area may be created or enlarged, no such tax may be levied or imposed nor the rate increased, or no such bonds may be issued. The subject matter of the petition shall not be proposed relative to any signatories of the petition within the next 2 years. Each resident of the special service area registered to vote at the time of the public hearing held with regard to the special service area shall be considered an elector. Each person in whose name legal title to land included within the boundaries of the special service area is held according to the records of the county wherein the land is located shall be considered an owner of record. Owners of record shall be determined at the time of the public hearing held with regard to a special service area. Land owned in the name of a land trust, corporation, estate, or partnership shall be considered to have a single owner of record.

(k) Any territory located within the boundaries of any special service area organized under this Section may become disconnected from the area in the manner provided in this subsection. A majority of the resident electors and a majority of the record owners of land in the territory sought to be disconnected from the area may sign a petition. The petition shall be addressed to the circuit court and shall contain a definite description of the boundaries of the territory sought to be disconnected and recite as a fact that, as of the date the petition is filed, the territory was not, is not, and is not intended by the corporate authority that created the special service area to be either benefited or served by any work or services either then existing or then authorized by the special service area, and that the territory constitutes less than 1.5% of the special service area's total equalized assessed valuation.

Upon the filing of the petition, the court shall set the petition for public hearing within 60 days after the date of the filing of the petition. The court shall give at least 45 days notice of the hearing by publishing notice of the hearing once in a newspaper having a general circulation within the special service area from which the territory is sought to be disconnected. The notice (i) shall refer to the petition filed with the court, (ii) shall describe the territory proposed to be disconnected, (iii) shall indicate the prayer of the petition and the date, time, and place at which the public hearing will be held, and (iv) shall further indicate that the corporate authority that created the special service area and any persons residing in or owning property in the territory involved or in the special service area from which the territory is sought to be disconnected shall have an opportunity to be heard on the prayer of the petition. Notice of the filing of the petition, the substance of which shall be as prescribed for the published notice, shall also be mailed to the presiding officer of the corporate authority from which the territory is sought to be disconnected.

The public hearing may be continued from time to time by the court. After the public hearing and having heard all persons desiring to be heard, including the corporate authority that created the special service area and all persons residing in or owning property in the territory involved or in the special service area from which the territory is sought to be disconnected, if the court finds that all the allegations of the petition are true, the court shall grant the prayer of the petition and shall enter an order disconnecting the territory from the special service area, which order shall be entered at length in the records of the court, and the clerk of the court shall file a certified copy of the order with the clerk of the district that created the special service area from which the territory has been disconnected. If the court finds that the allegations contained in the petition are not true, then the court shall enter an order dismissing the petition.

Any disconnected territory shall cease to be subject to any taxes levied under this Section and shall not be security for any future bonded indebtedness. When the amount of any taxes levied by a special service area is cancelled due to disconnection of territory, the court may, in the same disconnection proceeding, distribute the cancelled amount upon the other property in the area assessed, in a manner that the court finds just and equitable, not exceeding, however, the amount by which such property will benefit from the special service.

(l) If a property tax is levied, the tax shall be extended by the county clerk in the special service area in the manner provided by the Property Tax Code based on assessed values as established under that Act. In that case, the district shall file a certified copy of the ordinance creating the special service area, including an accurate map of the area, with the county clerk. The corporate authorities of the district are authorized to levy taxes in the special service area for the same year in which the ordinance and map are filed with the county clerk. In addition, the corporate authorities shall file a certified copy of each ordinance levying taxes in the special service area on or before the third Tuesday of September of each year and shall file a certified copy of any ordinance authorizing the issuance of bonds and providing for a property tax levy in that ordinance by December 31 of the year of the first levy.

Instead of or in addition to that property tax, a special tax may be levied and extended within the special service area on any other basis that provides a rational relationship between the amount of the tax levied against each lot, block, tract, and parcel of land in the special service area and the special service benefit rendered; a special tax roll shall be prepared containing (i) an explanation of the method of spreading the special tax, (ii) a list of lots, blocks, tracts, and parcels of land in the special service area, and (iii) the amount assessed against each. The special tax roll shall be included in the ordinance establishing the special service area or in an amendment to that ordinance, and shall be filed with the county clerk for use in extending the tax.

(m) An ordinance establishing a special service area shall not take effect until a certified copy of the ordinance, containing a description of the territory of the area, is filed for record in the office of the recorder in each county in which any part of the area is located.

(Source: P.A. 90-697, eff. 8-7-98.)