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90_SB0562
105 ILCS 5/17-2C
745 ILCS 10/1-211 new
745 ILCS 10/1-212 new
745 ILCS 10/9-103 from Ch. 85, par. 9-103
745 ILCS 10/9-105 from Ch. 85, par. 9-105
745 ILCS 10/9-107 from Ch. 85, par. 9-107
Amends the School Code and the Local Governmental and
Governmental Employees Tort Immunity Act. Provides that the
Local Governmental and Governmental Employees Tort Immunity
Act does not authorize the issuance of bonds or the levying
of taxes by a local public entity to fund the costs of
complying with equitable remedies relief or with an
injunction agreed to by the local public entity or ordered by
any court. Provides that a financially distressed school
district may not transfer from the Tort Immunity Fund to any
other school district fund any amount of monies to fund the
cost of complying with equitable remedies or relief or with
an injunction agreed to by the school district or ordered by
any court. Effective immediately.
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1 AN ACT concerning tort immunity.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 5. The School Code is amended by changing
5 Section 17-2C as follows:
6 (105 ILCS 5/17-2C)
7 Sec. 17-2C. Transfer from Tort Immunity Fund by
8 financially distressed school districts. The school board of
9 any school district that is certified under Section 19-1.5 as
10 a financially distressed school district may by resolution
11 transfer from the Tort Immunity Fund to any other school
12 district fund an amount of money not to exceed the lesser of
13 $2,500,000 or 0.6% of the value of the taxable property
14 within the district, provided the amount transferred is not
15 then required for the payment of any liabilities created by a
16 settlement or a tort judgement, defense costs, or for the
17 payment of any liabilities under the Unemployment Insurance
18 Act, Workers' Compensation Act, Occupational Diseases Act, or
19 risk care management programs.
20 Nothing in this Section authorizes transfer from the Tort
21 Immunity Fund to any other school district fund any amount of
22 monies to fund the cost of complying with equitable remedies
23 or relief or with an injunction agreed to by the school
24 district or ordered by any court.
25 This amendatory Act of 1997 is declaratory of existing
26 law.
27 (Source: P.A. 88-641, eff. 9-9-94.)
28 Section 10. The Local Governmental and Governmental
29 Employees Tort Immunity Act is amended by adding Sections
30 1-211 and 1-212 and changing Sections 9-103, 9-105, and 9-107
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1 as follows:
2 (745 ILCS 10/1-211 new)
3 Sec. 1-211. "Damages" means a sum of money awarded by
4 either judgment or settlement to a party on account of an
5 injury caused by the tortious act of a local public entity or
6 public employee, which sum of money is to be the separate
7 property of the party. "Damages" does not mean or include
8 the cost of complying with equitable remedies or relief or
9 with an injunction.
10 (745 ILCS 10/1-212 new)
11 Sec. 1-212. "Liability" means and refers exclusively to
12 liability for damages. "Liability" does not mean or refer to
13 liability for relief other than damages, such as the
14 obligation to comply with equitable remedies or relief or
15 with an injunction.
16 (745 ILCS 10/9-103) (from Ch. 85, par. 9-103)
17 Sec. 9-103. (a) A local public entity may protect itself
18 against any liability for damages that, property damage or
19 loss which may be imposed upon it or one of its employees for
20 a tortious act under Federal or State common or statutory
21 law, or imposed upon it under the Workers' Compensation Act,
22 the Workers' Occupational Diseases Act, or the Unemployment
23 Insurance Act by means of including, but not limited to,
24 insurance, individual or joint self-insurance, including all
25 operating and administrative costs and expenses directly
26 associated therewith, claims services and risk management
27 directly attributable to loss prevention and loss reduction,
28 legal services directly attributable to the insurance,
29 self-insurance, or joint self-insurance program, educational,
30 inspectional, and supervisory services directly relating to
31 loss prevention and loss reduction, or participation in a
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1 reciprocal insurer as provided in Sections 72, 76 and 81 of
2 the Illinois Insurance Code. Insurance shall be carried with
3 a company authorized by the Department of Insurance to write
4 such insurance coverage in Illinois.
5 (a-5) A local public entity may individually or jointly
6 self-insure provided it complies with any other statutory
7 requirements specifically related to individual or joint
8 self-insurance by local public entities. Whenever the terms
9 "self-insure" or "self-insurance" are utilized within this
10 Act, such term shall apply to both individual and joint
11 self-insurance. The expenditure of funds of a local public
12 entity to protect itself or its employees against liability
13 is proper for any local public entity. A local public entity
14 that has individually self-insured may establish reserves for
15 expected losses for any liability or loss for which the local
16 public entity is authorized to purchase insurance under this
17 Act. The decision of the local public entity to establish a
18 reserve and the amount of the reserve shall be based on
19 reasonable actuarial or insurance underwriting evidence.
20 Property taxes shall not be levied or extended if the effect
21 is to increase the reserve beyond 125% of the actuary's or
22 insurance underwriter's estimated ultimate losses at the 95%
23 confidence level. Certification of the amount of the reserve
24 shall be made by the independent auditor, actuary, or
25 insurance underwriter and included in an annual report.
26 (b) A local public entity may contract for or purchase
27 any of the guaranteed fund certificates or shares of
28 guaranteed capital as provided for in Section 56 of the
29 Illinois Insurance Code. The expenditure of funds of the
30 local public entity for said contract or purchase is proper
31 for any local public entity.
32 (c) Any insurance company that provides insurance
33 coverage to a local public entity shall utilize any
34 immunities or may assert any defenses to which the insured
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1 local public entity or its employees are entitled. Public
2 entities which are individually or jointly self-insured shall
3 be entitled to assert all of the immunities provided by this
4 Act or by common law or statute on behalf of themselves or
5 their employees unless the local public entities shall elect
6 by action of their corporate authorities or specifically
7 contract to waive in whole or in part such immunities.
8 (d) Within 30 days after January 1, 1991, and within 30
9 days after each January 1 thereafter, local public entities
10 that are individually or jointly self-insured to protect
11 against liability under the Workers' Compensation Act and the
12 Workers' Occupational Diseases Act shall file with the
13 Industrial Commission a report indicating an election to
14 self-insure.
15 This amendatory Act of 1997 is declaratory of existing
16 law.
17 (Source: P.A. 89-150, eff. 7-14-95.)
18 (745 ILCS 10/9-105) (from Ch. 85, par. 9-105)
19 Sec. 9-105. The board of a local taxing entity may,
20 instead of following the procedure under subdivision (b) of
21 Section 9-104 or when it considers the action advisable,
22 issue general obligation or revenue bonds without referendum
23 for the purpose of creating a reserve for or for the payment
24 of any cost, liability or loss against which such entity may
25 protect itself or self-insure pursuant to Section 9-103 or
26 for the payment of which such entity may levy a tax pursuant
27 to Section 9-107, including any or all tort judgments or
28 settlements entered against or entered into by the entity or
29 by or against another local public entity or an employee of
30 that other public entity while acting within the scope of
31 employment, either individually or where the local public
32 entities have joined in an intergovernmental joint
33 self-insurance contract which among other undertakings
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1 authorizes each local public entity to utilize its funds to
2 protect, wholly or partially, any other local public entity
3 or its employees against liability or loss in accordance with
4 the intergovernmental contract. Such bonds may be issued in
5 an amount necessary to fund a reserve created for any or all
6 of the above described purposes including the discharge of
7 obligations under such judgments or settlements. Such bonds
8 shall not be considered debt under any statutory limitation,
9 and may be issued in an amount, including existing
10 indebtedness, in excess of any heretofore or hereafter
11 imposed statutory limitation as to debt but subject to
12 constitutional limits.
13 Any bonds issued under this Section as limited bonds as
14 defined in Section 3 of the Local Government Debt Reform Act
15 shall comply with the requirements of the Bond Issue
16 Notification Act.
17 Nothing in this Act authorizes these bonds to be issued
18 in order to fund the cost of complying with equitable
19 remedies or relief or with an injunction agreed to by the
20 local taxing entity or ordered by any court.
21 This amendatory Act of 1997 is declaratory of existing
22 law.
23 (Source: P.A. 89-655, eff. 1-1-97.)
24 (745 ILCS 10/9-107) (from Ch. 85, par. 9-107)
25 Sec. 9-107. A local public entity may annually levy or
26 have levied on its behalf taxes upon all taxable property
27 within its territory at a rate that will produce a sum that
28 will be sufficient to: (i) pay the cost of insurance,
29 individual or joint self-insurance (including reserves
30 thereon), including all operating and administrative costs
31 and expenses directly associated therewith, claims services
32 and risk management directly attributable to loss prevention
33 and loss reduction, legal services directly attributable to
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1 the insurance, self-insurance, or joint self-insurance
2 program, and educational, inspectional, and supervisory
3 services directly relating to loss prevention and loss
4 reduction, participation in a reciprocal insurer as provided
5 in Sections 72, 76, and 81 of the Illinois Insurance Code, or
6 participation in a reciprocal insurer, all as provided in
7 Section 9-103; (ii) pay the cost of settlements or judgments
8 under Section 9-102; (iii) pay, including all costs and
9 reserves directly attributable to being a member of an
10 insurance pool, under Section 9-103; (iv) (ii) pay the costs
11 of and principal and interest on bonds issued under Section
12 9-105; (v) (iii) pay judgments and settlements under Section
13 9-104; and (vi) (iv) discharge obligations under Section
14 34-18.1 of The School Code, as now or hereafter amended, and
15 to pay the cost of risk management programs. Provided it
16 complies with any other applicable statutory requirements,
17 the local public entity may self-insure and establish
18 reserves for expected losses for any liability or loss for
19 which the local public entity is authorized to levy or have
20 levied on its behalf taxes for the purchase of insurance or
21 the payment of judgments or settlements under this Section.
22 The decision of the board to establish a reserve shall be
23 based on reasonable actuarial or insurance underwriting
24 evidence and subject to the limits and reporting provisions
25 in Section 9-103.
26 Funds raised pursuant to this Section shall only be used
27 for the purposes specified in this Act, including protection
28 against and reduction of any liability or loss described
29 hereinabove and under Federal or State common or statutory
30 law, the Workers' Compensation Act, the Workers' Occupational
31 Diseases Act and the Unemployment Insurance Act. Funds
32 raised pursuant to this Section may be invested in any manner
33 in which other funds of local public entities may be invested
34 under Section 2 of the Public Funds Investment Act. Interest
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1 on such funds shall be used only for purposes for which the
2 funds can be used or, if surplus, must be used for abatement
3 of property taxes levied by the local taxing entity.
4 A local public entity may enter into intergovernmental
5 contracts with a term of not to exceed 12 years for the
6 provision of joint self-insurance which contracts may include
7 an obligation to pay a proportional share of a general
8 obligation or revenue bond or other debt instrument issued by
9 a local public entity which is a party to the
10 intergovernmental contract and is authorized by the terms of
11 the contract to issue the bond or other debt instrument.
12 Funds due under such contracts shall not be considered debt
13 under any constitutional or statutory limitation and the
14 local public entity may levy or have levied on its behalf
15 taxes to pay for its proportional share under the contract.
16 Funds raised pursuant to intergovernmental contracts for the
17 provision of joint self-insurance may only be used for the
18 payment of any cost, liability or loss against which a local
19 public entity may protect itself or self-insure pursuant to
20 Section 9-103 or for the payment of which such entity may
21 levy a tax pursuant to this Section, including tort judgments
22 or settlements, costs associated with the issuance,
23 retirement or refinancing of the bonds or other debt
24 instruments, the repayment of the principal or interest of
25 the bonds or other debt instruments, the costs of the
26 administration of the joint self-insurance fund, consultant,
27 and risk care management programs or the costs of insurance.
28 Any surplus returned to the local public entity under the
29 terms of the intergovernmental contract shall be used only
30 for purposes set forth in subsection (a) of Section 9-103 and
31 Section 9-107 or for abatement of property taxes levied by
32 the local taxing entity.
33 Any tax levied under this Section shall be levied and
34 collected in like manner with the general taxes of the entity
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1 and shall be exclusive of and in addition to the amount of
2 tax that entity is now or may hereafter be authorized to levy
3 for general purposes under any statute which may limit the
4 amount of tax which that entity may levy for general
5 purposes. The county clerk of the county in which any part of
6 the territory of the local taxing entity is located, in
7 reducing tax levies under the provisions of any Act
8 concerning the levy and extension of taxes, shall not
9 consider any tax provided for by this Section as a part of
10 the general tax levy for the purposes of the entity nor
11 include such tax within any limitation of the percent of the
12 assessed valuation upon which taxes are required to be
13 extended for such entity.
14 With respect to taxes levied under this Section, either
15 before, on, or after the effective date of this amendatory
16 Act of 1994:
17 (1) Those taxes are excepted from and shall not be
18 included within the rate limitation imposed by law on
19 taxes levied for general corporate purposes by the local
20 public entity authorized to levy a tax under this
21 Section.
22 (2) Those taxes that a local public entity has
23 levied in reliance on this Section and that are excepted
24 under paragraph (1) from the rate limitation imposed by
25 law on taxes levied for general corporate purposes by the
26 local public entity are not invalid because of any
27 provision of the law authorizing the local public
28 entity's tax levy for general corporate purposes that may
29 be construed or may have been construed to restrict or
30 limit those taxes levied, and those taxes are hereby
31 validated. This validation of taxes levied applies to all
32 cases pending on or after the effective date of this
33 amendatory Act of 1994.
34 (3) Paragraphs (1) and (2) do not apply to a
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1 hospital organized under Article 170 or 175 of the
2 Township Code, under the Town Hospital Act, or under the
3 Township Non-Sectarian Hospital Act and do not give any
4 authority to levy taxes on behalf of such a hospital in
5 excess of the rate limitation imposed by law on taxes
6 levied for general corporate purposes. A hospital
7 organized under Article 170 or 175 of the Township Code,
8 under the Town Hospital Act, or under the Township
9 Non-Sectarian Hospital Act is not prohibited from levying
10 taxes in support of tort liability bonds if the taxes do
11 not cause the hospital's aggregate tax rate from
12 exceeding the rate limitation imposed by law on taxes
13 levied for general corporate purposes.
14 Revenues derived from such tax shall be paid to the
15 treasurer of the local taxing entity as collected and used
16 for the purposes of this Section and of Section 9-102,
17 9-103, 9-104 or 9-105, as the case may be. If payments on
18 account of such taxes are insufficient during any year to
19 meet such purposes, the entity may issue tax anticipation
20 warrants against the current tax levy in the manner provided
21 by statute.
22 Nothing in this Act authorizes the levying of taxes or
23 the issuance of bonds in order to fund the cost of complying
24 with equitable remedies or relief or with an injunction
25 agreed to by the local public entity or ordered by any court.
26 This amendatory Act of 1997 is declaratory of existing
27 law.
28 (Source: P.A. 88-545; 88-692, eff. 2-4-95; 89-150, eff.
29 7-14-95.)
30 Section 99. Effective date. This Act takes effect upon
31 becoming law.