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Illinois Compiled Statutes
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() 65 ILCS 5/Art. 8 Div. 12
(65 ILCS 5/Art. 8 Div. 12 heading)
DIVISION 12.
FINANCIALLY DISTRESSED CITY LAW
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65 ILCS 5/8-12-1
(65 ILCS 5/8-12-1) (from Ch. 24, par. 8-12-1)
Sec. 8-12-1.
This Division 12 may be cited as the
Financially Distressed City Law.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-2
(65 ILCS 5/8-12-2) (from Ch. 24, par. 8-12-2)
Sec. 8-12-2.
(a) Pursuant to the authority of the General Assembly to provide
for the public health, safety and welfare, the General Assembly hereby
finds and declares that it is the public policy and a public purpose of the
State to offer assistance to a financially distressed city so that it may
provide for the health, safety and welfare of its citizens, pay when due
principal and interest on its debt obligations, meet financial obligations
to its employees, vendors and suppliers, and provide for proper financial
accounting procedures, budgeting and taxing practices, as well as
strengthen the human and economic development of the city.
(b) It is the purpose of this Division to provide a secure financial
basis for the continued operation of a financially distressed city. The
intention of the General Assembly, in enacting this legislation is to
establish sound, efficient and generally accepted accounting, budgeting and
taxing procedures and practices within a financially distressed city, to
provide powers to a financial advisory authority established for a
financially distressed city, and to impose restrictions upon a financially
distressed city in order to assist that city in assuring its financial
integrity while leaving municipal services policies to the city, consistent
with the requirements for satisfying the public policy and purposes herein set
forth.
(c) It also is the purpose of this Division to authorize a city which
has been certified and designated as a financially distressed city under
the procedure set forth in Section 8-12-4, and which has by ordinance
requested that a financial advisory authority be appointed for the city and
that the city receive assistance as provided in this Division, and which
has filed certified copies of that ordinance in the manner provided by
Section 8-12-4, to enter into such agreements as are necessary to receive
assistance as provided in this Division and in applicable provisions of the
Illinois Finance Authority Act.
(Source: P.A. 93-205, eff. 1-1-04.)
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65 ILCS 5/8-12-3
(65 ILCS 5/8-12-3) (from Ch. 24, par. 8-12-3)
Sec. 8-12-3.
As used in this Division:
(1) "Authority" means the "(Name of Financially Distressed City) Financial
Advisory Authority".
(2) "Financially distressed city" means any municipality which is a home
rule unit and which (i) is certified by the Department of Revenue as being
in the highest 5% of all home rule municipalities in terms of the aggregate
of the rate per cent of all taxes levied pursuant to statute or ordinance
upon all taxable property of the municipality and as being in the lowest 5%
of all home rule municipalities in terms of per capita tax yield, and (ii)
is designated by joint resolution of the General Assembly as a financially
distressed city.
(3) "Home rule municipality" means a municipality which is a home
rule unit as provided in Section 6 of Article VII of the Illinois
Constitution.
(4) "Budget" means an annual appropriation ordinance or annual budget
as described in Division 2 of Article 8, as from time to time in effect in
the financially distressed city.
(5) "Chairperson" means the chairperson of the Authority appointed
pursuant to Section 8-12-7.
(6) "Financial Plan" means the financially distressed city's financial plan
as developed pursuant to Section 8-12-15, as from time to time in effect.
(7) "Fiscal year" means the fiscal year of the financially distressed city.
(8) "Obligations" means bonds, notes or other evidence of indebtedness
issued by the Illinois Finance Authority in
connection with
the provision of financial aid to a financially distressed city pursuant to
this Division and applicable provisions of the Illinois
Finance Authority Act.
(Source: P.A. 93-205, eff. 1-1-04.)
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65 ILCS 5/8-12-4
(65 ILCS 5/8-12-4) (from Ch. 24, par. 8-12-4)
Sec. 8-12-4.
In order to receive assistance as provided in this
Division, a home rule municipality shall first, by ordinance passed by its
corporate authorities, request (i) that the Department of Revenue certify
that it is in the highest 5% of all home rule municipalities in terms of
the aggregate of the rate per cent of all taxes levied pursuant to statute
or ordinance upon all taxable property of the municipality and in the
lowest 5% of all home rule municipalities in terms of
per capita tax yield, and (ii) that the General Assembly by joint
resolution designate it as a financially distressed city. A home rule
municipality which is so certified and designated as a financially
distressed city and which desires to receive assistance as provided in this
Division shall, by ordinance passed by its corporate authorities, request
that a financial advisory authority be appointed for the city and that the
city receive assistance as provided in this Division, and shall file a
certified copy of that ordinance with the Governor, with the Clerk of the
House of Representatives and with the Secretary of the Senate. Upon the
filing of the certified copies of that ordinance as required by this
Section this Division and all of its provisions shall then and thereafter
be applicable to the financially distressed city, shall govern and control
its financial accounting, budgeting and taxing procedures and practices,
and, subject to the limitations of subsection (a) of Section 8-12-22, shall
remain in full force and effect with respect thereto until such
time as the financial advisory authority established under Section 8-12-5
is abolished as provided in subsection (c) of Section 8-12-22.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-5
(65 ILCS 5/8-12-5) (from Ch. 24, par. 8-12-5)
Sec. 8-12-5.
For each financially distressed city to which this
Division is applicable as provided in Section 8-12-4, there is established
a body both corporate and politic to be known as the "(Name of Financially
Distressed City) Financial Advisory Authority" which, in such name, shall
exercise all authority vested in such Authority by this Division. The
Authority shall constitute an agency of State government, and as such may
receive and expend amounts appropriated by the General Assembly to the
Authority to enable it to exercise and perform its powers and
responsibilities under this Division. The financially distressed city
shall not be liable for any costs or expenses incurred by the Authority in
the conduct of its powers and responsibilities under this Division.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-6
(65 ILCS 5/8-12-6) (from Ch. 24, par. 8-12-6)
Sec. 8-12-6.
Purposes and powers.
(a) The purposes of the Authority shall be to provide a secure financial
basis for and to furnish assistance to a financially distressed city to which
this Division is applicable as provided in Section 8-12-4, and to request the
Illinois Finance Authority to issue its Obligations
on behalf of
and thereby provide financial aid to the city in accordance with applicable
provisions of the Illinois Finance Authority Act, so
that the city
can provide basic municipal services within its jurisdictional limits, while
permitting the distressed city to meet its obligations to its creditors and the
holders of its notes and bonds.
(b) Except as expressly limited by this Division, the Authority
shall have all powers necessary to meet its responsibilities and to carry
out its purposes and the purposes of this Division, including, but not
limited to, the following powers:
(1) To provide for its organization and internal | | management, and to make rules and regulations governing the use of its property and facilities.
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(2) To make and execute contracts, leases, subleases
| | and all other instruments or agreements necessary or convenient for the exercise of the powers and functions granted by this Division.
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(3) To approve all loans, grants, or other financial
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(4) To appoint officers, agents, and employees of the
| | Authority, define their duties and qualifications and fix their compensation and employee benefits.
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(5) To engage the services of consultants for
| | rendering professional and technical assistance and advice on matters within the Authority's power.
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(6) To pay the expenses of its operations.
(7) To determine, in its discretion but consistent
| | with the requirements of this Division, the terms and conditions of any loans it may make to the financially distressed city.
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(c) Any loan repayments received by the Authority from the distressed city
may be deposited by the Authority into a revolving fund under the control of
the Authority. Money in the revolving fund may be used by the Authority to
support activities leading to a restructuring of the distressed city's debt and
may be pledged by the Authority as security for any new debt incurred by the
distressed city with the approval of the Authority.
(d) From any funds appropriated to the Authority for the purpose of making
a loan to a distressed city, the Authority may expend not more than
$250,000 for the expenses of its operations in the fiscal year in which the
appropriation is made.
(Source: P.A. 93-205, eff. 1-1-04.)
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65 ILCS 5/8-12-7
(65 ILCS 5/8-12-7) (from Ch. 24, par. 8-12-7)
Sec. 8-12-7.
The governing body of the Authority shall be a board
consisting of 5 Directors. Directors shall be appointed by the Governor,
with the advice and consent of the Senate. At least 2 Directors must be
residents of the financially distressed city. The Governor shall select
one of the Directors to serve as Chairperson during the term of his or her appointment.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-8
(65 ILCS 5/8-12-8) (from Ch. 24, par. 8-12-8)
Sec. 8-12-8.
The initial Directors shall be appointed, as provided in
Section 8-12-7, within 30 days after this Division first becomes applicable
to the financially distressed city as provided in Section 8-12-4. Of the
initial Directors so appointed, 3 shall be appointed to serve for terms
expiring 3 years from the date of their appointment, and 2 shall be
appointed to serve for terms expiring 2 years from the date of their
appointment. Thereafter each Director shall be appointed to hold office for
a term of 3 years and until his or her successor has been appointed as
provided in Section 8-12-7. Directors shall be eligible for reappointment.
Any vacancy which shall arise shall be filled by appointment by the
Governor, with the advice and consent of the Senate, for the unexpired term
and until his or her successor has been appointed as provided in Section
8-12-7. A vacancy shall occur upon resignation, death, conviction of a
felony or removal from office of a Director. A Director may be removed for
incompetency, malfeasance or neglect of duty at the instance of the
Governor. If the Senate is not in session or is
in recess when appointments subject to its confirmation are made, the
Governor shall make temporary appointments which shall be subject to
subsequent Senate approval.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-9
(65 ILCS 5/8-12-9) (from Ch. 24, par. 8-12-9)
Sec. 8-12-9.
The Chairperson shall preside at meetings of the
Directors. The Directors may establish such offices and appoint such
officers for the Authority as they may deem appropriate.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-10
(65 ILCS 5/8-12-10) (from Ch. 24, par. 8-12-10)
Sec. 8-12-10.
Any State agency or unit of local government, within its
respective function, may render such services to the Authority as the
Authority may request. Upon the Authority's request any such agency
or unit of local government may transfer to the Authority such officers and
employees as the Authority and any such agency or unit of local government
deem necessary to carry out the Authority's functions and duties. Officers
and employees so transferred shall not lose or forfeit their employment status or rights.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-11
(65 ILCS 5/8-12-11) (from Ch. 24, par. 8-12-11)
Sec. 8-12-11.
The Directors shall serve without compensation, but each
Director shall be entitled to reimbursement for actual and necessary
expenses incurred in the performance of official duties as a Director.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-12
(65 ILCS 5/8-12-12) (from Ch. 24, par. 8-12-12)
Sec. 8-12-12.
(a) The Governor shall call the first
meeting of the Authority. Thereafter, the Directors shall prescribe
the times and places for their meetings and the manner in which regular
and special meetings may be called. The Directors shall comply in all
respects with the Open Meetings Act. The Authority shall be a public body to
which The Freedom of Information Act applies.
(b) A majority of the Directors holding office shall constitute a
quorum for the conduct of business. The affirmative votes of at least
3 Directors shall be necessary for adopting any rule or regulation,
and for any other action required by this Division to be taken by
resolution, directive or ordinance.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-13
(65 ILCS 5/8-12-13) (from Ch. 24, par. 8-12-13)
Sec. 8-12-13.
In carrying out the purposes of this Division, and pursuant
to Sections 8-12-14 through 8-12-24, as hereinafter provided, the Authority
shall have the power to approve or to reject the Financial Plans, Budgets
and contracts which are inconsistent with the Financial Plan and Budget of
the financially distressed city; provided, however, that the Authority
shall have no authority to impair any existing contract or obligation of
the city; and provided further, that with respect to any multi-year
employment contract or collective bargaining agreement authorized or
entered into by the city in accordance with applicable statutes and
ordinances, the Authority's power to approve or reject the same shall be
limited to the first year of such contract or agreement as provided in
Section 8-12-17.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-14
(65 ILCS 5/8-12-14) (from Ch. 24, par. 8-12-14)
Sec. 8-12-14.
The Budget of the financially distressed city for its
first fiscal year commencing after this Division first becomes applicable
to the financially distressed city as provided in Section 8-12-4, and for
each subsequent fiscal year shall be balanced in accordance with such
accounting system and procedures as may be prescribed by the Authority and
the requirements of State law, with substantial progress toward balancing
the Budget to be achieved during the remaining portion of what is the
financially distressed city's current fiscal year at the time this Division
first becomes applicable to the city as provided in Section 8-12-4.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-15
(65 ILCS 5/8-12-15) (from Ch. 24, par. 8-12-15)
Sec. 8-12-15.
The financially distressed city shall develop, adopt and
submit to the Authority, within 45 days after this Division first becomes
applicable to the city as provided in Section 8-12-4, for approval by the
Authority, an initial Financial Plan with respect to the remaining portion
of what is the city's current fiscal year at the time this Division first
becomes applicable to the city as provided in Section 8-12-4 and for the 2
succeeding fiscal years. The city shall develop and adopt subsequent
Financial Plans annually and during interim periods as directed by the
Authority. Interim updates shall be directed only when the Authority in
its discretion determines that a change in circumstances warrants such an
update. The Authority shall require that each Financial Plan cover a
period of at least 3 fiscal years. After adoption by the city, the city
shall submit each plan to the Authority for its approval not later than 60
days prior to the commencement of the first fiscal year to which the
Financial Plan relates. The Authority shall approve or reject the
Financial Plan not later than 30 days prior to the commencement of the
fiscal year. No Financial Plan shall have force or effect without approval
of the Authority. Each Financial Plan shall be developed, submitted,
approved and monitored in accordance with the following procedures:
(1) The financially distressed city shall determine and submit to the
Authority, at a time and in a manner prescribed by the Authority, estimates
of revenues available to the city during the period for which the Financial
Plan is to be in effect. The Authority shall approve, reject or amend the
revenue estimates. In the event the city fails, for any reason, to submit
to the Authority estimates of revenue as required by this paragraph, the
Authority may prepare such estimates. The Financial
Plan submitted by the city shall be based upon revenue estimates
approved or prepared by the Authority. As soon as practicable following
the establishment of the Authority, the corporate authorities of the city
shall, at the request of the Chairperson of the Authority, make available
to such Chairperson copies of the audited financial statements and of
the books and records of account of the city for the preceding 3 fiscal
years of the city.
(2) Each Financial Plan for each fiscal year or part thereof to which
it relates, shall contain: (i) a description of revenues and
expenditures, provision for debt service, cash resources and uses, and
capital improvements, each in such manner and detail as the Authority
shall prescribe; (ii) a description of the means by which the Budget
will be brought into balance in accordance with Section 8-12-14;
and (iii) such other financial matters that the Authority, in its
discretion, requires. The Authority may prescribe any reasonable
time, standards, procedures or forms for preparation and submission of
the Financial Plan.
(3) The Authority shall approve the initial and each subsequent
Financial Plan if, in its judgement, the plan is complete, is
reasonably capable of being achieved, and meets the requirement set
forth in Section 8-12-14. Otherwise, the Authority shall
reject the Financial Plan. The Authority's review of the Financial Plan
shall be in accordance with generally accepted accounting principles and
standards. No Financial Plan submitted by the financially distressed city
shall be arbitrarily or capriciously rejected by the Authority. Any
rejection by the Authority of any Financial Plan submitted by the city
shall be in writing and shall state the reasons for the rejection. In the
event of rejection, the Authority may prescribe a procedure and standards
for revision of the Financial Plan by the financially distressed city.
(4) The financially distressed city shall report to the Authority, at
such times and in such manner as the Authority may direct, concerning the
city's compliance with each Financial Plan. The Authority may review the
city's operation, obtain budgetary data and financial statements, require
the city to produce reports, and have access to any other information in
the possession of the city that it deems relevant to the Financial Plan and
the city's compliance with that Plan. The Authority may issue
recommendations or directives within its powers to the city to assure
compliance with the Financial Plan. The city shall produce such budgetary
data, financial statements, reports and other information and comply with
such directives.
(5) After approval of each Financial Plan, the financially distressed
city shall regularly reexamine the revenue and expenditure estimates on
which it was based and revise them as necessary. The city shall promptly
notify the Authority of any material change in the revenue or expenditure
estimates in the Financial Plan. The city may submit to the
Authority, or the Authority may require the city to submit, modified
Financial Plans based upon revised revenue or expenditure estimates
or for any other good reason. The Authority shall approve or reject
each modified Financial Plan pursuant to paragraph (3) of this
Section.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-16
(65 ILCS 5/8-12-16) (from Ch. 24, par. 8-12-16)
Sec. 8-12-16.
The financially distressed city shall develop, adopt
and submit to the Authority, within 30 days after this Division first
becomes applicable to the city as provided in Section 8-12-4, a revised
Budget for the remaining portion of what is the city's current fiscal year
at the time this Division first becomes applicable to the city as provided
in Section 8-12-4 and, thereafter, an annual Budget for each subsequent
fiscal year. After adoption by the city, the city shall submit each Budget
to the Authority for its approval not later than 60 days prior to the
commencement of the fiscal year to which the Budget relates. The
Authority shall approve or reject the Budget not later than 30 days prior
to the commencement of the fiscal year. No Budget shall have force or
effect without approval of the Authority. Each Budget shall be developed,
submitted, approved and monitored in accordance with the following procedures:
(1) Each Budget submitted by the financially distressed city shall be
based upon revenue estimates approved or prepared by the Authority, as
provided in paragraph (1) of Section 8-12-15.
(2) Each Budget shall contain such information and detail as may
be prescribed by the Authority. Any deficit for a fiscal year or any
portion of a fiscal year to which any Budget relates shall be included as a
current expense item for the succeeding fiscal year.
(3) The Authority shall approve each Budget if, in its judgment,
the Budget is complete with respect to providing a detailed accounting of
revenues and expenditures, is reasonably capable of being achieved, will
meet the requirement set forth in Section 8-12-14, and
will be consistent with the Financial Plan in effect. Otherwise, the
Authority shall reject the Budget. The Authority's review of the Budget
shall be in accordance with generally accepted accounting principles and
standards. No Budget submitted by the financially distressed city shall be
arbitrarily or capriciously rejected by the Authority. Any rejection by the
Authority of any Budget submitted by the city shall be in writing and shall
state the reasons for the rejection. In the event of rejection, the
Authority may prescribe a procedure and standards for revision of the
Budget by the city.
(4) The financially distressed city shall report to the Authority at
such times and such manner as the Authority may direct, concerning the
city's compliance with each Budget. The Authority may review the city's
operations, obtain budgetary data and financial statements, require the
city to produce reports, and have access to any other information in the
possession of the city that the Authority deems relevant. The Authority
may issue recommendations or directives within its powers to the city to
assure compliance with the Budget. The city shall produce such budgetary
data, financial statements, reports and other information and comply with
such directives.
(5) After approval of each Budget, the financially distressed city shall
promptly notify the Authority of any material change in the revenue or
expenditure estimates in the Budget. The city may submit to the Authority,
or the Authority may require the city to submit, a supplemental Budget
based upon revised revenue or expenditure estimates or for any other good
reason. The Authority shall approve or reject each supplemental Budget
pursuant to paragraph (3) of this Section.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-17
(65 ILCS 5/8-12-17) (from Ch. 24, par. 8-12-17)
Sec. 8-12-17.
(a) No contract or other obligation shall be entered into
by the financially distressed city unless it is consistent with the
Financial Plan and Budget in effect. No multi-year employment contract or
collective bargaining agreement authorized or entered into by the city in
accordance with applicable statutes and ordinances shall, with respect to
any terms and provisions thereof which are operative after expiration of
the first year of any such contract or agreement, be deemed inconsistent
with a Financial Plan and Budget at any time in effect; provided, however,
that any terms and provisions of a contract or agreement which would
increase expenditures for salaries, benefits or other forms of compensation
after the expiration of the first year of such contract or agreement shall
be contingent upon the attainment of sufficient available revenues,
considering all necessary expenditures, to support such increases.
(b) The Authority may adopt, and from time to time amend,
regulations identifying categories and types of contracts and other
obligations that shall be subject to approval by the Authority and
the procedure for submitting contracts for approval. Each contract or
other obligation that is entered into by the financially distressed city
and that requires approval by the Authority shall contain a provision
stating (i) that it shall not become legally binding on the city unless and
until it has received the approval of the Authority, and (ii) that the
Authority shall approve the contract if, in the Authority's judgment, the
information required to be submitted is complete with respect to the
contract or other obligation being an authorized expenditure within the
Financial Plan and Budget and the contract or other obligation is
consistent with the Financial Plan and Budget in effect. No contract or
other obligation that requires the approval of the Authority shall be
legally binding on the city unless and until it has received the approval
of the Authority. Subject to the foregoing, the prior approval of the
Authority is not required in order for the city to enter into a contract.
(c) The Authority shall approve the contract or obligation if, in
its judgement, the information required to be submitted is complete
and the contract or other obligation is consistent with the Budget and
Financial Plan in effect. Otherwise, the Authority shall reject the
contract or other obligation; provided, however, that any multi-year
employment contract or collective bargaining agreement authorized or
entered into by the city in accordance with applicable statutes and
ordinances shall be approved by the Authority if, in its judgement, the
terms and provisions operative during the first year of such contract
or agreement are consistent with the Budget and Financial Plan in
effect for that period, subject to the limitation that any terms and
provisions of any such contract or agreement which would increase
expenditures for salaries, benefits or other forms of compensation after
the expiration of the first year of the contract or agreement shall be
contingent upon the attainment of sufficient available revenues,
considering all necessary expenditures, to support such increases.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-18
(65 ILCS 5/8-12-18) (from Ch. 24, par. 8-12-18)
Sec. 8-12-18.
The financially distressed city shall meet its debt
service obligations as they become due. No other expenditure shall be made
by the city unless it is consistent with the Financial Plan and Budget in
effect.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-19
(65 ILCS 5/8-12-19) (from Ch. 24, par. 8-12-19)
Sec. 8-12-19.
The Authority shall appoint and shall have the authority
to remove a financial management officer. The financial management officer
shall have the responsibility for advising on the preparation of the Budget
and Financial Plan of the financially distressed city and for monitoring
expenditures of the city. The financial management officer shall be the
authorized signatory for all expenditures made from the proceeds of any
State loans provided for the benefit of the city pursuant to this Division
or any other law of this State, and for all expenditures made from
financial aid provided for the benefit of the city from Obligations issued
by the Illinois Finance Authority for such purposes
in
accordance with applicable provisions of the Illinois
Finance
Authority Act. The financial management officer shall be an employee of and
shall report to the Authority, may be granted authority by the Authority to
hire a specific number of employees to assist in meeting responsibilities,
and shall have access to all financial data and records of the city which
he or she deems necessary for the proper and efficient exercise of such
responsibilities. Neither the Authority or the financial management
officer shall have any authority to hire, fire or appoint city employees or
to manage the day-to-day operations of the city.
(Source: P.A. 93-205, eff. 1-1-04.)
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65 ILCS 5/8-12-20
(65 ILCS 5/8-12-20) (from Ch. 24, par. 8-12-20)
Sec. 8-12-20.
Upon direction of the Authority, the financially
distressed city shall reorganize its financial accounts and its management
and budgetary systems in whatever manner the Authority deems appropriate to
achieve greater financial responsibility and control. The Authority shall
not have the power to affect the taxing authority or to consolidate or
reduce the restricted debt service funds of the city.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-21
(65 ILCS 5/8-12-21) (from Ch. 24, par. 8-12-21)
Sec. 8-12-21.
The Authority in its sole discretion may intercept any
payments that the city from time to time is entitled to receive from any
funds then or thereafter held by the State Treasurer to the credit of the
city or otherwise in the custody of the State Treasurer to the credit of
the city, whether in or outside of the State Treasury, upon the occurrence
of any of the following:
(1) The financially distressed city's initial | | Financial Plan and revised Budget required to be submitted to the Authority with respect to the remaining portion of what is the city's current fiscal year at the time this Division first becomes applicable to the city as provided in Section 8-12-4 are not approved by the Authority within 60 days of their submission, and the Authority has theretofore given written warning notice to the corporate authorities of the city, on the 45th day after such initial Financial Plan and revised Budget were submitted, that the same have not yet been approved by the Authority; or
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(2) Any Financial Plan or Budget for any subsequent
| | fiscal year is not approved by the Authority by the commencement of the fiscal year to which such Financial Plan or Budget relates, and the Authority has theretofore given written warning notice to the corporate authorities of the city, on the 15th day prior to the commencement of that fiscal year, that the Financial Plan or Budget for such fiscal year has not yet been approved by the Authority; or
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(3) The financially distressed city materially
| | violates the provisions of this Division, and the Authority -- at least 15 days prior to initiating any action to intercept any payments pursuant to this Section -- has given the corporate authorities of the city written notice of the material violation and of the Authority's intention to intercept payments pursuant to this Section upon the expiration of that 15 day notice period unless the city satisfies the Authority within that 15 day period that the material violation cited by the Authority has been corrected; provided that the Authority shall not be required to give any notice to the city or its corporate authorities prior to initiating action to intercept payments pursuant to this Section if such payments are to be intercepted because of the city's failure to pay when due all amounts then due and owing and required to be paid by the city on Obligations issued by the Illinois Finance Authority in connection with the provision of financial aid to the city pursuant to this Division and applicable provisions of the Illinois Finance Authority Act.
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The intercept shall be made pursuant to written notice given by the
Authority to the State Comptroller and State Treasurer, setting forth the
amount of the intercept, which may be an aggregate amount not exceeding the
sum of the full amount of any outstanding State loans provided for the
benefit of the city pursuant to this Division or any other law of this
State, plus the full amount of all outstanding Obligations issued by the
Illinois Finance Authority on the financially
distressed city's
behalf in accordance with applicable provisions of the Illinois
Finance Authority Act. The State Comptroller and State Treasurer shall pay
to the Authority, from such funds as from time to time are legally
available therefor, the aggregate amount of the intercept, unless the
Authority sooner notifies the State Comptroller and State Treasurer in
writing that no further payments that the city is entitled to receive shall
be intercepted under the provisions of this Section.
(Source: P.A. 93-205, eff. 1-1-04.)
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65 ILCS 5/8-12-22
(65 ILCS 5/8-12-22) (from Ch. 24, par. 8-12-22)
Sec. 8-12-22.
(a) After the Authority has certified to the Governor
that the financially distressed city has completed 10 successive years of
balanced budgets:
(1) The powers and responsibilities granted or | | imposed upon the Authority and the financially distressed city under Section 8-12-13 and Sections 8-12-15 through 8-12-21 shall not be exercised, except as otherwise provided under subsection (b) of this Section.
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(2) The provisions of Section 8-12-14 shall continue
| | in full force and effect. The financially distressed city shall file with the Authority and with the Illinois Finance Authority, not later than 15 days prior to the commencement of the first fiscal year with respect to which the powers and responsibilities granted or imposed under Section 8-12-13 and Sections 8-12-15 through 8-12-21 are not to be exercised, and not later than 15 days prior to the commencement of each fiscal year thereafter, a balanced Budget as adopted by the financially distressed city for such fiscal year. In addition, for each fiscal year with respect to which the powers and responsibilities granted or imposed under Section 8-12-13 and Sections 8-12-15 through 8-12-21 are not to be exercised, the financially distressed city shall file with the Authority and with the Illinois Finance Authority a certified copy of the same audit report and supplemental report which are required to be made and filed for such fiscal year by the city under the Illinois Municipal Auditing Law, the filing with the Authority and the Illinois Finance Authority to be made within the time provided for the filing of such audit report and supplemental report with the State Comptroller under Section 8-8-4.
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(b) The Authority and the Illinois Finance
Authority
shall review each Budget, audit report and supplemental report filed with
them as provided in paragraph (2) of subsection (a). In the event the
financially distressed city fails to file any Budget or certified copy of
an audit report or supplemental report as provided in paragraph (2) of
subsection (a), or in the event the Illinois Finance
Authority,
after consultation with the Authority, determines that the Budget adopted
by the financially distressed city and filed as provided in paragraph (2)
of subsection (a) is not balanced as required under Section 8-12-14, the
Illinois Finance Authority shall certify such failure
to file, or
failure to adopt a Budget which is balanced as required, to the Governor;
and concurrent with that certification, the Authority established under
Section 8-12-5 and the financially distressed city shall resume the
exercise and performance of their respective powers and responsibilities
pursuant to each Section of this Division.
(c) When the Illinois Finance Authority determines
that
all of its Obligations have been fully paid and discharged or otherwise
provided for, it shall certify that fact to the Governor; and the Authority
established under Section 8-12-5 shall be abolished 30 days after the date
of that certification. Upon abolition of the Authority as provided in this
subsection, this Division shall have no further force or effect upon the
financially distressed city.
(Source: P.A. 93-205, eff. 1-1-04.)
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65 ILCS 5/8-12-23
(65 ILCS 5/8-12-23) (from Ch. 24, par. 8-12-23)
Sec. 8-12-23.
A financially distressed city to which this Division
applies shall remain subject to all other applicable provisions of this
Act, except as limited by this Division; provided, however, that in case of
a conflict between the provisions of this Division and any other provision
of this Act, the provisions of this Division shall control.
(Source: P.A. 86-1211.)
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65 ILCS 5/8-12-24
(65 ILCS 5/8-12-24) (from Ch. 24, par. 8-12-24)
Sec. 8-12-24.
A home rule unit which is a financially distressed city
to which this Division is applicable as provided in Section 8-12-4 may not
employ financial or fiscal accounting or budgetary procedures or systems,
nor place into effect any Financial Plan or Budget, nor enter into any
contract or make any expenditure, nor otherwise conduct its financial and
fiscal affairs or take other action in a manner inconsistent with the
provisions of this Division, until such time as the powers and
responsibilities of the Authority are terminated as provided in Section
8-12-22. This Section is a limitation under subsection (i) of Section 6 of
Article VII of the Illinois Constitution on the concurrent exercise by home
rule units which are financially distressed cities to which this Division
is applicable as provided in Section 8-12-4 of powers and functions
exercised by the State.
(Source: P.A. 86-1211.)
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