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90_HB1409
New Act
5 ILCS 70/8 from Ch. 1, par. 1107
65 ILCS 5/9-2-9 from Ch. 24, par. 9-2-9
Creates the Special Assessment Supplemental Bond and
Procedure Act to provide supplemental authority regarding the
procedures for the making and payment of local improvements
by special assessment and the issuance and sale of
obligations payable from the special assessments. Provides
that a governing body that elects to become subject to this
Act, by referring to this Act in the special assessment
ordinance, may provide for certain additional amounts in the
special assessment for the acquisition and construction of
local improvements. Provides that a governmental unit may,
by a supplemental ordinance, choose to use only the
provisions of the Act concerning the Supplemental Act
Assessment Bonds. Provides for the issuance of Supplemental
Act Assessment Bonds in an amount not to exceed the amount of
the assessments confirmed in a special assessment proceeding
less the principal amount of any assessment previously paid
and less the principal amount of any vouchers that may have
been previously issued. Amends the Statute on Statutes to
include the Special Assessment Supplemental Bond and
Procedure Act in the list of Omnibus Bond Acts. Amends the
Illinois Municipal Code to provide that multiple local
improvements may be combined under one special assessment
project provided that the assessing commissioner considers
whether each piece of property is benefitted by all or only
some of the improvements. Provides that combining
improvements under one special assessment project shall not
be a ground for objection to the special assessment
proceeding. Effective immediately.
LRB9004052KDksA
LRB9004052KDksA
1 AN ACT to provide for supplemental procedures and
2 issuance of obligations in connection with the making of
3 local improvements through special assessments.
4 Be it enacted by the People of the State of Illinois,
5 represented in the General Assembly:
6 Section 1. Short Title. This Act may be cited as the
7 Special Assessment Supplemental Bond and Procedures Act.
8 Section 5. Finding. The General Assembly finds that: (a)
9 there have been many important changes in the financial
10 markets and practices with respect to the issuance of
11 obligations to provide funds for the payment of local
12 improvements to be paid from the imposition of special
13 assessments; (b) various provisions of Illinois law relating
14 to the making of local improvements and the provision for
15 payment of same through the imposition of special assessments
16 according to benefits are now outdated; (c) these outdated
17 provisions result in additional costs for the citizens of
18 the State of Illinois who are property owners and subject to
19 the payment of such special assessments; (d) the General
20 Assembly deems it advisable and in the best interest of such
21 property owners to provide supplemental authority regarding
22 the procedures for the making of local improvements and the
23 payment for same by special assessment and the issuance and
24 sale of obligations payable from such special assessments in
25 order to accommodate current and anticipated financial
26 markets and practices and the provisions of current federal
27 income tax law.
28 Section 10. Definitions. As used in this Act, unless the
29 context or usage clearly indicates otherwise:
30 "Governing body" means the legislative body, counsel,
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1 board, commission, trustees, or any other body by whatever
2 name it is known having charge of the corporate affairs of a
3 governmental unit.
4 "Governmental unit" means a county, township,
5 municipality, municipal corporation, unit of local
6 government, or a special district, by whatever name known,
7 authorized by any special assessment law to make local
8 improvements by special assessment.
9 "Special assessment bond" means any instrument evidencing
10 the obligation to pay money authorized or issued by or on
11 behalf of a governmental unit under a special assessment law
12 or under this Act, being payable from assessments made under
13 a special assessment law, and when applicable, as
14 supplemented by this Act.
15 "Special assessment law" means any law of the State of
16 Illinois authorizing governmental units to make local
17 improvements payable wholly or in part by special assessment,
18 and includes, without limitation, Division 2 of Article 9 of
19 the Illinois Municipal Code, Division 5-32 of Article 5 of
20 the Counties Code, Section 21 of the North Shore Sanitary
21 District Act, Section 19 of the Sanitary District Act of
22 1917, Sections 22a.1 through 22a.55 of the Sanitary District
23 Act of 1917, and Section 28 of the Sanitary District Act of
24 1936.
25 "Special assessment proceeding" means the proceeding by
26 any governmental unit under a special assessment law to
27 provide for the making of a specific local improvement by
28 special assessment.
29 "Special assessment ordinance" means an ordinance, or
30 when applicable a resolution, as provided for by any special
31 assessment law by which the governing body institutes, calls
32 for, or provides for the making of a local improvement to be
33 paid by the imposition of a special assessment pursuant to
34 such special assessment law.
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1 "Supplemental Act Assessment Bonds" are those special
2 assessment bonds issued under Section 100 of this Act.
3 "Voucher" means any voucher issued under a special
4 assessment law for work done in connection with the making
5 of a local improvement.
6 Section 15. Supplemental powers; election. The provisions
7 of this Act are intended to be supplemental to and in
8 addition to all other powers or authorities granted to any
9 governmental unit, shall be construed liberally, and shall
10 not be construed as a limitation of any power or authority
11 otherwise granted. Any governmental unit may use the
12 provisions of this Act by making an election referring to
13 this Act in the special assessment ordinance. In addition,
14 a governmental unit may use the provisions of this Act that
15 relate exclusively to Supplemental Act Assessment Bonds by
16 making an election referring to this Act in any ordinance or
17 resolution passed subsequent to the special assessment
18 ordinance.
19 Section 20. Additional costs allowed. In addition to
20 and in excess of all costs otherwise permitted to be
21 assessed under any special assessment law in any special
22 assessment proceeding, the governing body may in the special
23 assessment ordinance provide for the following additional
24 amounts in the assessment:
25 (a) an additional reserve, not to exceed 12% of the
26 amount of the total cost of the improvement, as a
27 reserve for the payment of interest on or principal of
28 bonds when due in the event of nonpayment of any
29 assessments;
30 (b) an amount for the payment of interest upon
31 bonds for a period not to exceed the greater of 2 years
32 or a period ending 6 months after the estimated date of
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1 completion of the acquisition and construction of the
2 local improvement that is the subject of the special
3 assessment proceeding; and
4 (c) an amount for bond discount (the difference
5 between the face amount of a bond and the price at which
6 the bond is to be sold) not to exceed 4% of the total
7 cost of the improvement. The reserve provided for by
8 clause (a) of this Section shall be in addition to and
9 in excess of any other reserve otherwise permitted by
10 special assessment law including reserves for interest
11 deficiencies. Any additional cost or reserve to be
12 included by authority of this Section shall be expressly
13 provided for in the special assessment ordinance and
14 shall further be expressly stated in any engineer's
15 estimate of cost prepared in connection with a special
16 assessment ordinance as provided by a special assessment
17 law.
18 Section 25. Interest on assessments. The unpaid portion
19 of any assessment imposed under a special assessment
20 proceeding may bear interest at an interest rate or rates
21 not exceeding the rate or rates on bonds permitted by the
22 Bond Authorization Act; provided, however, that the time of
23 the adoption of the special assessment ordinance shall be
24 the date that the maximum rate or rates shall be calculated
25 rather than at the time the contract is made for the sale of
26 the bonds, as provided in the Bond Authorization Act.
27 Notwithstanding the foregoing provision, from and after the
28 due date of any installment of an assessment, the following
29 additional rates and charges may be imposed with respect to
30 the delinquent amount of such installment:
31 (a) an additional rate of interest not to exceed
32 1/2 of the stated rate of interest payable with respect
33 to such assessment; and
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1 (b) a collection charge of not to exceed 1% of the
2 amount of the delinquent installment.
3 Section 30. Amount and term of installments. An
4 assessment under a special assessment proceeding may be
5 payable in one or more installments coming due not more than
6 31 years after the date of the judgment order of final
7 confirmation of the assessment roll and report for such
8 special assessment proceeding. The first installment for
9 interest on such special assessment may be deferred for such
10 period of time during which interest upon bonds payable from
11 such special assessment has been provided for pursuant to the
12 provisions of Section 50 of this Act. Installments of
13 principal of a special assessment need not become due in
14 equal amounts, but rather, if provided for in the special
15 assessment ordinance, shall become due in the years and in
16 the amounts as shall be provided in the special assessment
17 ordinance. Prepayments of assessments may be made subject to
18 a prepayment premium of not to exceed 3% for a period of not
19 to exceed 11 years, may be limited in the special assessment
20 ordinance to a given date or dates not less frequently than
21 annually, and may be limited to payment in whole but not in
22 part or in whole or in part in certain stated minimum
23 amounts. In the event that a governing body deems it
24 advisable to refund Supplemental Act Assessment Bonds in a
25 manner that would either increase installments or extend the
26 number of years in which installments may be payable, the
27 governing body may do so through a supplemental special
28 assessment ordinance and proceeding under applicable special
29 assessment law, provided the number of installments shall not
30 be increased so as to become due beyond the original maximum
31 term of 31 years provided in this Section. In the event such
32 a refunding does not increase installments or extend the
33 years in which payable, the governing body may refund
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1 Supplemental Act Assessment Bonds through a supplemental
2 special assessment ordinance only.
3 Section 35. Notice of first installment and accrual of
4 interest. In lieu of the establishment of the date of the
5 first installment of a special assessment and the accrual of
6 interest on assessments by the issuance of a first voucher
7 and the filing of a certificate with the clerk of court or
8 other act as may be provided by a special assessment law,
9 either the governing body or the board of local improvements
10 may, at any time, after the judicial order of final
11 confirmation of the assessment roll and report, file with the
12 clerk of court in which the assessment was confirmed a notice
13 of the due date of the first installment and the date from
14 which interest shall accrue on the assessments. The notice
15 shall state the due date of the first installment, which
16 shall be not earlier than January 2 of the following year or
17 such later year as shall have been determined under Section
18 70 of this Act, and also the date upon which interest shall
19 begin to accrue on the assessments, which date shall be not
20 earlier than 60 days after the date the notice provided for
21 in this Section shall have been filed with the clerk of
22 court. In connection with the application of any special
23 assessment law, the notice shall be treated upon its filing
24 as if the notice were a certificate of first voucher or other
25 act as may be provided by a special assessment law, and all
26 procedures related to the filing of a certificate of first
27 voucher or such other act shall be deemed to have been
28 appropriately followed, subject only to the modifications to
29 such procedures provided for in this Act.
30 Section 40. Award of contract. In any special assessment
31 proceeding, upon the vote of two-thirds of the members of the
32 governing body then in office, the governing body or the
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1 board of local improvements, as may be applicable, may award
2 a contract or contracts for the improvement pursuant to
3 negotiation with one or more persons, without the requirement
4 of competitive bidding.
5 Section 45. Bonds. In lieu of the issuance of vouchers
6 or bonds provided by a special assessment law, Supplemental
7 Act Assessment Bonds payable from the assessments made under
8 a special assessment proceeding may be issued under this
9 Section. Supplemental Act Assessment Bonds shall be issued
10 under the following terms and provisions:
11 (a) They shall be payable from the assessments made
12 under a special assessment proceeding and such other income
13 or revenues as may lawfully be pledged to the payment of such
14 bonds by a governmental unit.
15 (b) They may be issued in lieu of vouchers at any time on
16 or after the time when interest begins to run on the
17 assessments made under a special assessment proceeding.
18 (c) They may be issued in an amount not to exceed the
19 amount of the assessments confirmed in a special assessment
20 proceeding less the principal amount of any assessments
21 previously paid and less the principal amount of any vouchers
22 that may have previously been issued.
23 (d) They may bear interest at any rate or rates not to
24 exceed the rate or rates permitted by the Bond Authorization
25 Act; provided, however, that such rate or rates shall not
26 exceed the rate or rates provided for the unpaid installments
27 of the assessments made under the special assessment
28 proceeding.
29 (e) They may pay interest upon such date or dates either
30 annually, semi-annually, monthly, weekly, or otherwise.
31 (f) They may be subject to redemption with or without
32 premium upon such terms and provisions as may be provided by
33 the governing body, including, without limitation, terms as
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1 to the order of redemption (numerical, pro-rata, by series,
2 or otherwise) and as to the timing thereof.
3 (g) They shall be negotiable instruments under Illinois
4 law.
5 (h) They may be made payable either serially or at term,
6 or any combination thereof, in such order of preference,
7 priority, lien position, or rank (including, without
8 limitation, numerical, pro-rata, by series, or otherwise) and
9 otherwise have any attributes permitted to bonds under the
10 Local Government Debt Reform Act, as the governing body may
11 provide.
12 Section 50. Alternative local procedure. Upon the request
13 of all of the owners of record to be subject to assessment in
14 a special assessment proceeding, the alternative procedure
15 for the proceeding set forth in this Section may be used. In
16 this alternative procedure, the board of local improvements
17 shall conduct all of the proceedings and perform all of the
18 acts otherwise performed by the court. There shall be no
19 right to jury trial or any reference to the rules of civil
20 procedure applicable to the court, but the board of local
21 improvements shall conduct its proceedings with due notice,
22 fairly and impartially. Determinations of the board of local
23 improvements shall be treated as the determination of an
24 administrative agency and shall be subject to appeal under
25 the same procedures as an appeal of an administrative
26 decision of an administrative agency under the Administrative
27 Review Law.
28 Section 55. County clerk may collect. Pursuant to the
29 Illinois constitutional and statutory provisions relating to
30 intergovernmental cooperation, the county clerk of any county
31 in which property subject to a special assessment is located
32 may, but shall not be required to, agree to mail bills for a
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1 special assessment with the regular tax bills of the county,
2 or otherwise as may be provided by a special assessment law.
3 If the clerk agrees to mail such bills with the regular tax
4 bills, then the annual amount due as of January 2 shall
5 become due instead in even installments with each tax bill
6 made during the year in which such January 2 date occurs,
7 thus deferring to later date in the year the obligation to
8 pay the assessments.
9 Section 60. Recital. Supplemental Act Assessment Bonds
10 that are issued in part under this Act may contain a recital
11 to that effect and any such recital shall be conclusive as
12 against the governmental body thereof and any other person as
13 to the validity of the Supplemental Act Assessment Bonds and
14 as to their compliance with the provisions of this Act.
15 Section 70. The Statute on Statutes is amended by
16 changing Section 8 as follows:
17 (5 ILCS 70/8) (from Ch. 1, par. 1107)
18 Sec. 8. Omnibus Bond Acts.
19 (a) A citation to the Omnibus Bond Acts is a citation to
20 all of the following Acts, collectively, as amended from time
21 to time: the Bond Authorization Act, the Registered Bond
22 Act, the Municipal Bond Reform Act, the Local Government Debt
23 Reform Act, subsection (a) of Section 1-7 of the Property Tax
24 Extension Limitation Act, subsection (a) of Section 18-190 of
25 the Property Tax Code, the Uniform Facsimile Signature of
26 Public Officials Act, the Local Government Bond Validity Act,
27 the Illinois Development Finance Authority Act, the Public
28 Funds Investment Act, the Local Government Credit Enhancement
29 Act, the Local Government Defeasance of Debt Law, the
30 Intergovernmental Cooperation Act, the Local Government
31 Financial Planning and Supervision Act, the Special
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1 Assessment Supplemental Bond and Procedure Act, and any
2 similar Act granting additional omnibus bond powers to
3 governmental entities generally, whether enacted before, on,
4 or after the effective date of this amendatory Act of 1989.
5 (b) The General Assembly recognizes that the
6 proliferation of governmental entities has resulted in the
7 enactment of hundreds of statutory provisions relating to the
8 borrowing and other powers of governmental entities. The
9 General Assembly addresses and has addressed problems common
10 to all such governmental entities so that they have equal
11 access to the municipal bond market. It has been, and will
12 continue to be, the intention of the General Assembly to
13 enact legislation applicable to governmental entities in an
14 omnibus fashion, as has been done in the provisions of the
15 Omnibus Bond Acts.
16 (c) It is and always has been the intention of the
17 General Assembly that the Omnibus Bond Acts are and always
18 have been supplementary grants of power, cumulative in nature
19 and in addition to any power or authority granted in any
20 other laws of the State. The Omnibus Bond Acts are
21 supplementary grants of power when applied in connection with
22 any similar grant of power or limitation contained in any
23 other law of the State, whether or not the other law is
24 enacted or amended after an Omnibus Bond Act or appears to be
25 more restrictive than an Omnibus Bond Act, unless the General
26 Assembly expressly declares in such other law that a
27 specifically named Omnibus Bond Act does not apply.
28 (d) All instruments providing for the payment of money
29 executed by or on behalf of any governmental entity organized
30 by or under the laws of this State, including without
31 limitation the State, to carry out a public governmental or
32 proprietary function, acting through its corporate
33 authorities, or which any governmental entity has assumed or
34 agreed to pay, which were:
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1 (1) issued or authorized to be issued by
2 proceedings adopted by such corporate authorities before
3 the effective date of this amendatory Act of 1989;
4 (2) issued or authorized to be issued in accordance
5 with the procedures set forth in or pursuant to any
6 authorization contained in any of the Omnibus Bond Acts;
7 and
8 (3) issued or authorized to be issued for any
9 purpose authorized by the laws of this State,
10 are valid and legally binding obligations of the governmental
11 entity issuing such instruments, payable in accordance with
12 their terms.
13 (Source: P.A. 87-17; 88-670, eff. 12-2-94.)
14 Section 75. The Illinois Municipal Code is amended by
15 changing Section 9-2-9 as follows:
16 (65 ILCS 5/9-2-9) (from Ch. 24, par. 9-2-9)
17 Sec. 9-2-9. Preliminary procedure for local improvements
18 by special assessment. All ordinances for local improvements
19 to be paid for wholly or in part by special assessment or
20 special taxation shall originate with the board of local
21 improvements. Petitions for any local improvement shall be
22 addressed to that board. The board may originate a scheme for
23 any local improvement to be paid for by special assessment or
24 special tax, either with or without a petition, and in either
25 case shall adopt a resolution describing the proposed
26 improvement. This resolution may provide that specifications
27 for the proposed improvement be made part of the resolution
28 by reference to specifications previously adopted by
29 resolution by the municipality, or to specifications adopted
30 or published by the State of Illinois or a political
31 subdivision thereof, provided that a copy of the
32 specifications so adopted by reference is on file in the
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1 office of the clerk of the municipality. This resolution
2 shall be at once transcribed into the records of the board.
3 The proposed local improvement may consist of the
4 construction of more than one street, storm drain, sewer,
5 water main, or sanitary sewer improvements and appurtenances
6 in a local area pursuant to a single special assessment
7 project, provided that in assessing each lot, block, tract,
8 and parcel of property, the commissioner so assessing shall
9 take into consideration whether each lot, block, tract, or
10 parcel is benefitted by all or only some of the improvements
11 combined into the single special assessment project. The
12 fact that more than one improvement is being constructed as
13 part of a single special assessment project shall not be
14 grounds for an objection by an assessee to the special
15 assessment proceeding in court.
16 Whenever the proposed improvement requires that private
17 or public property be taken or damaged, the resolution shall
18 describe the property proposed to be taken or damaged for
19 that purpose. The board, by the same resolution, shall fix a
20 day and hour for a public hearing thereon. The hearing shall
21 not be less than 10 days after the adoption of the
22 resolution. The board shall also have an estimate of the cost
23 of the improvement (omitting land to be acquired) made in
24 writing by the engineer of the board, (if there is an
25 engineer, if not, then by the president) over his signature.
26 This estimate shall be itemized to the satisfaction of the
27 board and shall be made a part of the record of the
28 resolution. However, such an estimate is not required in
29 municipalities having a population of 100,000 or more when
30 the proposed improvement consists only of taking or damaging
31 private or public property. And in cities and villages which
32 have adopted prior to the effective date of this Code or
33 which after the effective date of this Code adopt the
34 commission form of municipal government, the estimate of the
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1 cost of the improvement, (omitting land to be acquired),
2 shall be made in writing by the public engineer if there is
3 one, of the city or village, if not, then by the mayor or
4 president of the city or village.
5 Notice of the time and place of the public hearing shall
6 be sent by mail directed to the person who paid the general
7 taxes for the last preceding year on each lot, block, tract,
8 or parcel of land fronting on the proposed improvement not
9 less than 5 days prior to the time set for the public
10 hearing. These notices shall contain (1) the substance of the
11 resolution adopted by the board, (2) when an estimate is
12 required by this Division 2 the estimate of the cost of the
13 proposed improvement, and (3) a notification that the extent,
14 nature, kind, character, and (when an estimate is required by
15 this article) the estimated cost of the proposed improvement
16 may be changed by the board at the public hearing thereon. If
17 upon the hearing the board deems the proposed improvement
18 desirable, it shall adopt a resolution and prepare and submit
19 an ordinance therefor. But in proceedings only for the
20 laying, building, constructing, or renewing of any sidewalk,
21 water service pipe, or house drain, no resolution, public
22 hearing, or preliminary proceedings leading up to the same
23 are necessary. In such proceedings the board may submit to
24 the corporate authorities an ordinance, together with its
25 recommendation and (when an estimate is required) the
26 estimated cost of the improvement, as made by the engineer.
27 Such proceedings shall have the same effect as though a
28 public hearing had been held thereon.
29 In the event that a local improvement is to be
30 constructed with the assistance of any agency of the Federal
31 government, or other governmental agency, the resolution of
32 the board of local improvements shall set forth that fact and
33 the estimate of cost shall set forth and indicate, in dollars
34 and cents, the estimated amount of assistance to be so
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1 provided.
2 (Source: Laws 1963, p. 2425.)
3 Section 99. Effective date. This Act takes effect upon
4 becoming law.