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Illinois Compiled Statutes

Information maintained by the Legislative Reference Bureau
Updating the database of the Illinois Compiled Statutes (ILCS) is an ongoing process. Recent laws may not yet be included in the ILCS database, but they are found on this site as Public Acts soon after they become law. For information concerning the relationship between statutes and Public Acts, refer to the Guide.

Because the statute database is maintained primarily for legislative drafting purposes, statutory changes are sometimes included in the statute database before they take effect. If the source note at the end of a Section of the statutes includes a Public Act that has not yet taken effect, the version of the law that is currently in effect may have already been removed from the database and you should refer to that Public Act to see the changes made to the current law.

(65 ILCS 5/) Illinois Municipal Code.

65 ILCS 5/Art. 8 Div. 4.1

    (65 ILCS 5/Art. 8 Div. 4.1 heading)

65 ILCS 5/8-4.1-1

    (65 ILCS 5/8-4.1-1) (from Ch. 24, par. 8-4.1-1)
    Sec. 8-4.1-1. This Division shall be known and may be cited as the "Municipal Bond Reform Act."
(Source: P.A. 85-158.)

65 ILCS 5/8-4.1-2

    (65 ILCS 5/8-4.1-2) (from Ch. 24, par. 8-4.1-2)
    Sec. 8-4.1-2. In addition to other words and terms as defined in this Code, the following words or terms shall as used in this Division have the meanings set forth opposite each unless the context or usage clearly indicates that another meaning is intended.
    "Applicable Law" means any provision of this Code or any other provision of law authorizing municipalities to issue Bonds.
    "Backdoor Referendum" means the submission of a public question to the voters of a municipality, initiated by a petition of voters or residents or property owners of such municipality, to determine whether an action by the corporate authorities of such municipality shall be effective, adopted or rejected.
    "Bonds" means any instrument evidencing the obligation to pay money authorized or issued by or on behalf of a municipality under Applicable Law including, without limiting the generality of the foregoing, bonds, notes, installment or financing contracts, leases, certificates, tax anticipation warrants or notes, vouchers, or any evidence of indebtedness.
    "General Obligation Bonds" means Bonds of a municipality for the payment of which the municipality is empowered to levy ad valorem property taxes upon all taxable property in the municipality without limitation as to rate or amount.
    "Municipality" for the purpose of this Division also includes water commissions under Division 135 of Article 11 of this Code or any other entity created by intergovernmental agreement and comprised solely of cities, villages, or incorporated towns.
    "Revenue Bonds" means any Bonds of a municipality other than General Obligation Bonds.
(Source: P.A. 85-158.)

65 ILCS 5/8-4.1-3

    (65 ILCS 5/8-4.1-3) (from Ch. 24, par. 8-4.1-3)
    Sec. 8-4.1-3. The provisions of this Act are intended to be supplemental and in addition to all other power or authority granted to municipalities, shall be construed liberally and shall not be construed as a limitation of any power or authority otherwise granted.
(Source: P.A. 85-158.)

65 ILCS 5/8-4.1-4

    (65 ILCS 5/8-4.1-4) (from Ch. 24, par. 8-4.1-4)
    Sec. 8-4.1-4. Whenever Applicable Law provides that the authorization or the issuance of Bonds, or the becoming effective of an ordinance or resolution providing for the authorization or issuance of Bonds, may be subject to a backdoor referendum, the provisions of this Section may be used as an alternative to the specific procedures as otherwise set forth by Applicable Law.
    A. The corporate authorities may adopt an authorizing ordinance describing briefly the authority under which Bonds are proposed to be issued, the nature of the project or purpose to be financed, the estimated total costs of the project or purpose, including in such costs all items related to financing the project or purpose, and the maximum amount of Bonds authorized to be issued to pay such costs. No further details or specifications are required in such authorizing ordinance. Such authorizing ordinance, along with any other notice as required by Applicable Law, including any notice as to the right of electors to file a petition and the number of voters required to sign any such petition, shall be published or posted as required by Applicable Law. A petition may be filed after such publication or posting during the period as provided by Applicable Law; but upon the expiration of any such period, the corporate authorities shall be authorized to issue such Bonds as if they had followed all necessary procedures set forth in such Applicable Law.
    B. If no petition meeting the requirements of the Applicable Law is filed during the petition period hereinabove referred to, then the corporate authorities may adopt additional ordinances or proceedings supplementing or amending the authorizing ordinance so long as the maximum amount of Bonds as set forth in the authorizing ordinance hereinabove provided for is not exceeded, and there is no material change in the project or purpose described in the authorizing ordinance. Such additional ordinances or proceedings shall in all instances become effective immediately without publication or posting or any further act or requirement. The authorizing ordinance, together with such additional ordinances or proceedings, shall constitute complete authority for the issuance of such Bonds under the Applicable Law.
(Source: P.A. 85-158.)

65 ILCS 5/8-4.1-5

    (65 ILCS 5/8-4.1-5) (from Ch. 24, par. 8-4.1-5)
    Sec. 8-4.1-5. The corporate authorities may provide for a reserve fund solely for the payment of the principal of and interest on Bonds. Bond proceeds may be used to provide such reserve fund.
(Source: P.A. 85-158.)

65 ILCS 5/8-4.1-6

    (65 ILCS 5/8-4.1-6) (from Ch. 24, par. 8-4.1-6)
    Sec. 8-4.1-6. The corporate authorities are authorized and may covenant and contract with the holders of Revenue Bonds to levy, charge and collect moneys pledged as security for the payment of Revenue Bonds in amounts sufficient to provide for the prompt payment of the principal of and interest on such Bonds, and to provide an additional amount of money, as debt service coverage, computed as a percentage of the amount of principal and interest scheduled to be payable in any given year.
(Source: P.A. 85-158.)

65 ILCS 5/8-4.1-7

    (65 ILCS 5/8-4.1-7) (from Ch. 24, par. 8-4.1-7)
    Sec. 8-4.1-7. The proceeds of Bonds may be used to provide for the payment of interest upon such Bonds for a period not to exceed the greater of 2 years or a period ending 6 months after the estimated date of completion of the acquisition and construction of the project or accomplishment of the purpose for which such Bonds are issued.
    In addition it shall be lawful for the corporate authorities of any municipality issuing Bonds to appropriate money for the purpose of paying interest on such Bonds during the period described above. Such appropriation may be made in the ordinance authorizing such Bonds and shall be fully effective upon the effective date of such ordinance without any further notice, publication or approval whatsoever.
(Source: P.A. 85-158.)

65 ILCS 5/8-4.1-8

    (65 ILCS 5/8-4.1-8) (from Ch. 24, par. 8-4.1-8)
    Sec. 8-4.1-8. Bonds authorized by Applicable Law may be issued in one or more series, bear such date or dates, become due at such time or times within the period of years provided by Applicable Law, bear interest payable at such intervals and at such rate or rates as authorized under Section 2 of "An Act to authorize public corporations to issue bonds, other evidences of indebtedness and tax anticipation warrants subject to interest rate limitations set forth therein," approved May 26, 1970, as now or hereafter amended, which rates may be fixed or variable, be in such denominations, be in such form, either coupon or registered or book-entry, carry such conversion, registration, and exchange privileges, be subject to defeasance upon such terms, have such rank or priority, be executed in such manner, be payable in such medium of payment at such place or places within or without the State of Illinois, be subject to such terms of redemption with or without premium, and be sold in such manner at private or public sale and at such price as the corporate authorities shall determine. Whenever such bonds are sold at a price less than par, they shall be sold at such price and bear interest at such rate or rates such that the net interest rate received upon the sale of such Bonds does not exceed the maximum rate determined under Section 2 of "An Act to authorize public corporations to issue bonds, other evidences of indebtedness and tax anticipation warrants subject to interest rate limitations set forth therein", approved May 26, 1970, as now or hereafter amended.
(Source: P.A. 85-158.)

65 ILCS 5/8-4.1-9

    (65 ILCS 5/8-4.1-9) (from Ch. 24, par. 8-4.1-9)
    Sec. 8-4.1-9. Any redemption premium payable upon the redemption of Bonds may be payable from the proceeds of refunding Bonds which may be issued under Applicable Law for the purpose of refunding such Bonds, from any other lawfully available source or from both proceeds and such other sources.
(Source: P.A. 85-158.)

65 ILCS 5/8-4.1-10

    (65 ILCS 5/8-4.1-10) (from Ch. 24, par. 8-4.1-10)
    Sec. 8-4.1-10. In addition to the authority otherwise available to invest funds, corporate authorities may authorize and upon such authorization the Treasurer of any municipality may invest proceeds of Bonds or money on deposit in any debt service or reserve fund or account relating to Bonds in obligations the interest upon which is tax exempt under the provisions of Section 103 of the Internal Revenue Code of 1986, as amended, or successor code or provision, subject to such tax-exempt obligations being rated at the time of purchase within the 4 highest general classifications established by a rating service of nationally recognized expertise in rating bonds of states and the political subdivisions thereof.
(Source: P.A. 85-158.)

65 ILCS 5/8-4.1-11

    (65 ILCS 5/8-4.1-11) (from Ch. 24, par. 8-4.1-11)
    Sec. 8-4.1-11. A municipality may pledge, as security for the payment of its Bonds, (a) revenues derived from the operation of any utility system or revenue producing enterprise; (b) moneys deposited or to be deposited in any special fund of the municipality; (c) grants or other revenues expected to be received by the municipality from the state or federal government; (d) special assessments to be collected with respect to a local improvement financed with the proceeds of Bonds; or (e) payments to be made by another unit of local government pursuant to a service agreement with the municipality.
    Any such pledge made by a municipality shall be valid and binding from the time such pledge is made. The revenues, moneys and other funds so pledged and thereafter received by the municipality shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act; and, subject only to the provisions of prior agreements, the lien of such pledge shall be valid and binding as against all parties having claims of any kind in trust, contract or otherwise against the municipality irrespective of whether such parties have notice thereof. No ordinance, resolution, trust agreement or other instrument by which such pledge is created need be filed or recorded; except in the records of the municipality.
(Source: P.A. 85-158.)

65 ILCS 5/8-4.1-12

    (65 ILCS 5/8-4.1-12) (from Ch. 24, par. 8-4.1-12)
    Sec. 8-4.1-12. Bonds which are issued in part pursuant to this Act may contain a recital to that effect and any such recital shall be conclusive as against the municipality and the corporate authorities thereof and any other person as to the validity of the Bonds and as to their compliance with the provisions of this Act.
(Source: P.A. 85-158.)