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| [ House Amendment 003 ] |
90_SB0747enr
30 ILCS 105/1.1 from Ch. 127, par. 137.1
Amends the State Finance Act by making technical changes
to the Short Title.
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1 AN ACT concerning State finance.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 1. Short title. This Act may be cited as the
5 Real Estate Leasing Act.
6 Section 5. Applicability.
7 (a) All leases of real property for use of State
8 agencies, authorities, boards, commissions, departments,
9 institutions, bodies politic, and all other administrative
10 units or outgrowths of the executive branch of State
11 government except the Constitutional officers, the State
12 Board of Education, and the State colleges and universities
13 and their governing bodies shall be procured in accordance
14 with the provisions of this Act.
15 (b) Notwithstanding anything to the contrary in this
16 Act, the purchase of real estate in fee simple or less than
17 fee simple, including by lease purchase, is not subject to
18 this Act, but shall be purchased in accordance with law and
19 rules established outside this Act.
20 (c) For purposes of this Act, "Director" shall mean the
21 Director of Central Management Services.
22 Section 10. Leases. The Director shall have the
23 authority to procure leases for real property.
24 Section 15. Method of source selection.
25 (a) Request for information. Except as provided in
26 subsections (b) and (c) of this Section, all leases of real
27 property shall be awarded by a request for information
28 process in accordance with Section 20 of this Act.
29 (b) Other methods. A request for information process
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1 need not be used and the procurement may be negotiated in the
2 following situations:
3 (1) renewal or extension of existing leases,
4 (2) temporary space as defined by rule,
5 (3) specialized space available at only one
6 location and parking,
7 (4) emergency, when there exists a threat to public
8 health or public safety, or when immediate expenditure is
9 necessary for repairs to State property in order to
10 protect against further loss of or damage to State
11 property, to prevent or minimize serious disruption in
12 State services, or to ensure the integrity of State
13 records. Emergency procurements shall be made with as
14 much competition as is practical under the circumstances
15 and shall be reported in the manner prescribed in
16 paragraph (3) of subsection (a) of Section 6 of the
17 Illinois Purchasing Act.
18 (c) Leases with governmental units. Leases with other
19 governmental units may be negotiated without using the
20 request for information process when deemed by the Director
21 to be in the best interest of the State.
22 Section 20. Request for information.
23 (a) Contents. A request for information shall be issued
24 and shall include:
25 (1) the type of property to be leased;
26 (2) the proposed uses of the property;
27 (3) the duration of the lease;
28 (4) the preferred location of the property; and
29 (5) a general description of the configuration
30 desired.
31 (b) Public notice. Public notice of the request for
32 information shall be published in a newspaper of general
33 circulation in each community where the using agency is
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1 seeking space. The advertisement shall be published at least
2 14 days before the deadline for submission of responses to
3 the request for information. The Director may also authorize
4 publication in electronic form.
5 (c) Response. The response to the request for
6 information shall consist of written information sufficient
7 to show that the respondent can meet minimum criteria set
8 forth in the request. The Director may enter into
9 discussions with respondents for the purpose of clarifying
10 State needs and the information supplied by the respondents.
11 On the basis of the information supplied and discussions, if
12 any, the Director shall make a written determination
13 identifying the responses that meet the minimum criteria set
14 forth in the request for information. Negotiations shall be
15 entered into with all qualified respondents for the purpose
16 of securing a lease that is in the best interest of the
17 State. A written report of the negotiations shall be
18 retained in the lease files and shall include the reasons for
19 the final selection. All leases shall be reduced to writing
20 and filed in accordance with law.
21 Section 25. Other selection procedures. Nothing in this
22 Act shall prohibit the Director from using more restrictive
23 competitive selection procedures.
24 Section 30. Rent without occupancy. Except when deemed
25 by the Director to be in the best interest of the State, no
26 State agency may incur rental obligations before occupying
27 the space rented.
28 Section 35. Local site preferences. Upon the request of
29 the chief executive officer of a unit of local government,
30 leasing preferences may be given to sites located in
31 enterprise zones, tax increment districts, or redevelopment
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1 districts when deemed to be in the best interest of the
2 State.
3 Section 40. Purchase option. For initial leases of all
4 space in a free-standing building, the Director shall
5 consider whether a purchase option exerciseable by the State
6 would be appropriate. The Director's determination shall be
7 documented in the lease file.
8 Section 80. The Civil Administrative Code of Illinois is
9 amended by changing Section 67.02 as follows:
10 (20 ILCS 405/67.02) (from Ch. 127, par. 63b13.2)
11 Sec. 67.02. (a) To lease or purchase office and storage
12 space, buildings, land and other facilities for all State
13 agencies, authorities, boards, commissions, departments,
14 institutions, bodies politic and all other administrative
15 units or outgrowths of the executive branch of State
16 government except the Constitutional officers, the State
17 Board of Education and the State colleges and universities
18 and their governing bodies. However, before leasing or
19 purchasing any office or storage space, buildings, land or
20 other facilities in any municipality the Department shall
21 survey the existing State-owned and State-leased property to
22 make a determination of need. Such leases shall be for a
23 term not to exceed 5 years, except that such leases may
24 contain a renewal clause subject to acceptance by the State
25 after that date or an option to purchase. Such purchases
26 shall be made through contracts which may provide for the
27 title to the property to transfer immediately to the State or
28 a trustee or nominee for the benefit of the State and which
29 shall: provide for the consideration to be paid in
30 installments to be made at stated intervals during a certain
31 term not to exceed 30 years from the date of the contract and
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1 may provide for the payment of interest on the unpaid balance
2 at a rate that does not exceed a rate determined by adding 3
3 percentage points to the annual yield on United States
4 Treasury obligations of comparable maturity as most recently
5 published in the Wall Street Journal at the time such
6 contract is signed. Such leases and purchase contracts shall
7 be and shall recite that they are subject to termination and
8 cancellation in any year for which the General Assembly fails
9 to make an appropriation to pay the rent or purchase
10 installments payable under the terms of the lease or purchase
11 contract. Additionally such purchase contract shall specify
12 that title to the office and storage space, buildings, land
13 and other facilities being acquired under such a contract
14 shall revert to the Seller in the event of the failure of
15 the General Assembly to appropriate suitable funds.
16 However, this limitation on the term of such leases does not
17 apply to leases to and with the Illinois Building Authority,
18 as provided for in the Act enacted by the Seventy-second
19 General Assembly entitled the Building Authority Act, which
20 leases to and with said Authority may be entered into for a
21 term not to exceed 30 years and shall be and shall recite
22 that they are subject to termination and cancellation in any
23 year for which the General Assembly fails to make an
24 appropriation to pay the rent payable under the terms of such
25 lease. These limitations do not apply where the lease or
26 purchase contract contains a provision limiting the liability
27 for the payment of the rentals or installments thereof solely
28 to funds received from the Federal government.
29 (b) To lease from an airport authority office, aircraft
30 hangar and service buildings constructed upon a public
31 airport under the Airport Authorities Act for the use and
32 occupancy of the State Department of Transportation, which
33 lease may be entered into for a term not to exceed 30 years.
34 (c) To establish training programs for teaching State
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1 leasing procedures and practices to new employees of the
2 Department and to keep all employees of the Department
3 informed about current leasing practices and developments in
4 the real estate industry.
5 (d) To enter into an agreement with a municipality or
6 county to construct, remodel or convert a structure for the
7 purposes of its serving as a correctional institution or
8 facility pursuant to paragraph (c) of Section 3-2-2 of the
9 Unified Code of Corrections.
10 (e) To enter into an agreement with a private
11 individual, trust, partnership or corporation or a
12 municipality or other unit of local government, when
13 authorized to do so by the Department of Corrections, whereby
14 such individual, trust, partnership or corporation or
15 municipality or other unit of local government will
16 construct, remodel or convert a structure for the purposes of
17 its serving as a correctional institution or facility and
18 then lease such structure to the Department for the use of
19 the Department of Corrections. A lease entered into pursuant
20 to the authority granted in this subsection shall be for a
21 term not to exceed 30 years, but may grant to the State the
22 option to purchase the structure outright.
23 Such leases shall be and shall recite that they are
24 subject to termination and cancellation in any year for which
25 the General Assembly fails to make an appropriation to pay
26 the rent payable under the terms of the lease.
27 (f) On and after September 17, 1983, the powers granted
28 to the Department under this Section shall be exercised
29 exclusively by the Department and no other State agency may
30 concurrently exercise any such power, unless specifically
31 authorized otherwise by a later enacted law. This subsection
32 is not intended to impair any contract existing as of
33 September 17, 1983.
34 However, no lease for more than 10,000 square feet of
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1 space shall be executed unless the Director in consultation
2 with the Executive Director of the Capital Development Board
3 has certified that leasing is in the best interest of the
4 State, considering programmatic requirements, availability of
5 vacant State-owned space, the cost-benefits of purchasing or
6 constructing new space and other criteria as he shall
7 determine. The Director shall not permit multiple leases for
8 less than 10,000 square feet to be executed in order to evade
9 this provision.
10 (g) To develop and implement, in cooperation with the
11 Interagency Energy Conservation Committee, a system for
12 evaluating energy consumption in facilities leased by the
13 Department, and to develop energy consumption standards for
14 use in evaluating prospective lease sites.
15 (h) (1) After the effective date of this amendatory Act
16 of 1997, the Department shall not enter into an agreement
17 for the installment purchase or lease purchase of
18 buildings, land, or facilities unless:
19 (A) the using agency certifies to the
20 Department that the agency reasonably expects the
21 building, land, or facilities being considered for
22 purchase will meet a permanent space need;
23 (B) the building or facilities will be
24 substantially occupied by State agencies after
25 purchase (or after acceptance in the case of a build
26 to suit);
27 (C) the building or facilities shall be in new
28 or like new condition and have a remaining economic
29 life exceeding the term of the contract;
30 (D) no structural or other major building
31 component or system shall have a remaining economic
32 life of less than 10 years;
33 (E) the building, land or facilities:
34 (i) is free of any identifiable
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1 environmental hazard, or
2 (ii) is subject to a management plan,
3 provided by the seller and acceptable to the
4 State, to address the known environmental
5 hazard;
6 (F) the building, land, or facilities satisfy
7 applicable handicap accessibility and applicable
8 building codes; and
9 (G) the State's cost to lease purchase or
10 installment purchase the building, land, or
11 facilities is less than the cost to lease space of
12 comparable quality, size, and location over the
13 lease purchase or installment purchase term.
14 (2) The Department shall establish the methodology
15 for comparing lease costs to the costs of installment or
16 lease purchases. The cost comparison shall take into
17 account all relevant cost factors including, but not
18 limited to, debt service, operating and maintenance
19 costs, insurance and risk costs, real estate taxes,
20 reserves for replacement and repairs, security costs, and
21 utilities. Such methodology shall also provide:
22 (A) that the comparison will be made using
23 level payment plans; and
24 (B) that a purchase price must not exceed the
25 fair market value of the buildings, land, or
26 facilities, and that such price must be
27 substantiated by an appraisal or by a competitive
28 selection process.
29 (3) If the Department intends to enter into an
30 installment purchase or lease purchase agreement for
31 buildings, land, or facilities under circumstances that
32 do not satisfy the conditions specified by this Section,
33 it must issue a notice to the Secretary of the Senate and
34 the Clerk of the House. Such notice shall contain (i)
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1 specific details of the State's proposed purchase,
2 including the amounts, purposes, and financing terms;
3 (ii) a specific description of how the proposed purchase
4 varies from the procedures set forth in this Section; and
5 (iii) a specific justification, signed by the Director,
6 of why it is in the State's best interests to proceed
7 with the purchase. The Department may not proceed with
8 such an installment purchase or lease purchase agreement
9 if, within 60 calendar days after delivery of the notice,
10 the General Assembly, by joint resolution, disapproves
11 the transaction. Delivery may take place on a day and at
12 an hour when the Senate and House are not in session so
13 long as the offices of Secretary and Clerk are open to
14 receive the notice. In determining the 60 day period
15 within which the General Assembly must act, the day on
16 which delivery is made to the Senate and House shall not
17 be counted. If delivery of the notice to the 2 houses
18 occurs on different days, the 60 day period shall begin
19 on the day following the later delivery.
20 (4) On or before February 15 of each year, the
21 Department shall submit an annual report to the Director
22 of the Bureau of the Budget and the General Assembly
23 regarding installment purchases or lease purchases of
24 buildings, land, or facilities that were entered into
25 during the preceding calendar year. The report shall
26 include a summary statement of the aggregate amount of
27 the State's obligations under such purchases; specific
28 details pertaining to each purchase, the amounts,
29 purposes, and financing terms and payment schedule for
30 each purchase; and any other matter that the Department
31 deems advisable.
32 The requirement for reporting to the General
33 Assembly shall be satisfied by filing copies of the
34 report with the Auditor General, the Speaker, the
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1 Minority Leader, and the Clerk of the House of
2 Representatives and the President, the Minority Leader,
3 and the Secretary of the Senate, the Chairs of the
4 Appropriations Committees, and the Legislative Research
5 Unit, as required by Section 3.1 of the General Assembly
6 Organization Act, and filing such additional copies with
7 the State Government Report Distribution Center for the
8 General Assembly as is required under paragraph (t) of
9 Section 7 of the State Library Act.
10 (Source: P.A. 87-852.)
11 Section 90. The State Finance Act is amended by changing
12 Section 9 as follows:
13 (30 ILCS 105/9) (from Ch. 127, par. 145)
14 Sec. 9. (a) No disbursements from appropriations shall
15 be made for rental or purchase of office or other space,
16 buildings or land, except in pursuance of a written lease or
17 purchase contract entered into by the proper State authority
18 and the owner or authorized agent of the property. Such lease
19 shall not exceed 5 years unless a greater term is authorized
20 by law, but such lease may contain a renewal clause subject
21 to acceptance by the State after that date or an option to
22 purchase. Such purchase contract may provide for the title to
23 the property to transfer immediately to the State or a
24 trustee or nominee for the benefit of the State and for the
25 consideration to be paid in installments to be made at stated
26 intervals during a certain term not to exceed 30 years from
27 the date of the contract and may provide for the payment of
28 interest on the unpaid balance at a rate that does not exceed
29 a rate determined by adding 3 percentage points to the annual
30 yield on United States Treasury obligations of comparable
31 maturity as most recently published in the Wall Street
32 Journal at the time such contract is signed. Such lease or
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1 purchase contract shall be and shall recite that it is
2 subject to termination and cancellation in any year for which
3 the General Assembly fails to make an appropriation to pay
4 the rent or purchase installments payable under the terms of
5 such lease or purchase contract. Additionally such purchase
6 contract shall specify that title to the office and storage
7 space, buildings, land and other facilities being acquired
8 under such a contract shall revert to the Seller in the event
9 of the failure of the General Assembly to appropriate
10 suitable funds. This limitation does not apply to leases for
11 office or other space, buildings, or land, where such leases
12 or purchase contracts contain a provision limiting the
13 liability for the payment of the rental or installments
14 thereunder solely to funds received from the Federal
15 Government. A copy of each such lease or purchase contract
16 shall be filed in the office of the Secretary of State within
17 15 days after execution.
18 (b) The State, through the Bureau of the Budget for real
19 property and improvements and personal property related
20 thereto, and through the Department of Central Management
21 Services for personal property, may issue or cause to be
22 issued certificates of participation or similar instruments
23 representing the right to receive a proportionate share in
24 lease-purchase or installment purchase payments to be made by
25 or for the benefit of one or more State agencies for the
26 acquisition or improvement of real or personal property, or
27 refinancing of such property or payment of expenses related
28 to the issuance. The total principal amount of the
29 certificates issued or caused to be issued pursuant to this
30 Section for acquisition of real property shall not exceed
31 $125,000,000. Certificates issued or caused to be issued
32 pursuant to this Section shall mean certificates heretofore
33 or hereafter signed and delivered by the State or signed and
34 delivered by a trustee or fiscal agent pursuant to the
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1 written direction of the State. Nothing in this Section
2 shall (i) prohibit or restrict the issuance of or affect the
3 validity or enforceability of certificates heretofore or
4 hereafter signed and delivered by any lessor or seller or an
5 assignee of either under a lease purchase or installment
6 purchase contract with the State or signed and delivered by a
7 trustee or fiscal agent pursuant to the written direction of
8 such lessor or seller or an assignee of either, or (ii)
9 affect the validity or enforceability of any such lease
10 purchase or installment purchase contract.
11 (1) Certificates may be issued or caused to be issued
12 pursuant to this Section if the Director of the Bureau of the
13 Budget determines that it is financially desirable and in the
14 best interest of the State to use certificates of
15 participation to finance or refinance installment purchase or
16 lease purchase contracts entered into by State departments,
17 agencies, or universities or to refund or advance refund
18 prior issuances of certificates of participation or similar
19 instruments including certificates of participation issued
20 under this Section and certificates of participation issued
21 before the effective date of this amendatory Act of 1997 the
22 State determines that the use of certificates of
23 participation is financially desirable and in the best
24 interest of the State. The State, through the Bureau of the
25 Budget for real property and improvements and personal
26 property related thereto, and through the Department of
27 Central Management Services for personal property, may enter
28 into arrangements for issuing, securing, and marketing
29 certificates of participation, including agreements, trust
30 indentures and other arrangements necessary or desirable to
31 carry out the foregoing, and any reserve funds or other
32 amounts securing the certificates may be held and invested as
33 provided in such agreements and trust indentures.
34 (2) Certificates of participation or similar instruments
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1 issued or caused to be issued pursuant to this Section and
2 the underlying lease purchase lease-purchase or installment
3 purchase contracts shall not constitute or create debt of the
4 State as defined in the Illinois Constitution, nor a
5 contractual obligation in excess of the amounts appropriated
6 therefor, and the State shall have no continuing obligation
7 to appropriate money for said payments or other obligations
8 due under the lease purchase lease-purchase or installment
9 purchase contracts; provided, however, that the Governor
10 shall include in the annual budget request to the General
11 Assembly for each relevant fiscal year appropriations
12 sufficient to permit payment of all amounts which will be due
13 and payable during the fiscal year with respect to
14 certificates of participation issued or caused to be issued
15 pursuant to this Section.
16 (3) The maximum term of certificates of participation
17 issued to finance personal property shall be 10 years. The
18 maximum term of certificates of participation to finance the
19 acquisition or improvement of real property shall be 25
20 years. In no event, however, shall the term exceed the
21 expected useful life of the property being financed, with the
22 term calculated from the date of delivery, with respect to
23 personal property, and the date of occupancy, with respect to
24 real property.
25 (4) Ten days before the issuance of certificates of
26 participation under this Section, the Director of the Bureau
27 of the Budget for real property and improvements and personal
28 property related thereto and the Department of Central
29 Management Services for personal property shall transmit to
30 the Executive Director of the Economic and Fiscal Commission,
31 to the Auditor General, to the President of the Senate, the
32 Minority Leader of the Senate, the Speaker of the House of
33 Representatives, and the Minority Leader of the House of
34 Representatives, to the Chairs of the Appropriations
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1 Committees, and to the Secretary of the Senate and Clerk of
2 the House a notice providing the following information
3 pertaining to the property to be financed by the
4 certificates:
5 (1) The agency and program procuring the property.
6 (2) A brief description of the property.
7 (3) The estimated cost of the property if purchased
8 outright.
9 (4) The estimated terms of the financings.
10 (5) The estimated total lease or installment
11 purchase payments for property.
12 (6) The estimated lease or installment purchase
13 payments by fiscal year for the current fiscal year and
14 the next 5 fiscal years.
15 (7) The anticipated source of funds to make lease
16 or installment purchase payments.
17 (8) Those items not anticipated to be financed upon
18 enactment of the budget for the fiscal year.
19 A copy of the Preliminary Official Statement shall also
20 be transmitted to the Executive Director of the Economic and
21 Fiscal Commission, to the Auditor General, to the President
22 of the Senate, the Minority Leader of the Senate, the Speaker
23 of the House of Representatives, the Minority Leader of the
24 House of Representatives, to the Chairs of the Appropriations
25 Committees, and to the Secretary of the Senate and Clerk of
26 the House at the time it is submitted for publication. After
27 the issuance of the certificates, a copy of the final
28 official statement accompanying the issuance shall be filed
29 with the Economic and Fiscal Commission, with the Auditor
30 General, with the President of the Senate, the Minority
31 Leader of the Senate, the Speaker of the House of
32 Representatives, and the Minority Leader of the House of
33 Representatives, with the Chairs of the Appropriations
34 Committees, and with the Secretary of the Senate and Clerk of
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1 the House.
2 (5) The Bureau of the Budget may, based on a cost
3 benefit analysis, issue general obligation bonds to finance
4 or refinance installment purchase or lease purchase contracts
5 entered into by State departments, agencies, or universities
6 or to refund or advance refund prior issuances of
7 certificates of participation or similar instruments,
8 including certificates of participation issued under this
9 Section and certificates of participation issued before the
10 effective date of this amendatory Act of 1997.
11 (6) (3) The Department of Central Management Services
12 may promulgate rules governing its issuance and conditions of
13 use of certificates of participation and similar instruments.
14 (c) Amounts paid from appropriations for personal
15 service of any officer or employee of the State, either
16 temporary or regular, shall be considered as full payment for
17 all services rendered between the dates specified in the
18 payroll or other voucher and no additional sum shall be paid
19 to such officer or employee from any lump sum appropriation,
20 appropriation for extra help or other purpose or any
21 accumulated balances in specific appropriations, which
22 payments would constitute in fact an additional payment for
23 work already performed and for which remuneration had already
24 been made, except that wage payments made pursuant to the
25 application of the prevailing rate principle or based upon
26 the effective date of a collective bargaining agreement
27 between the State, or a State agency and an employee group,
28 or payment of funds as an adjustment to wages paid employees
29 or officers of the State for the purpose of correcting a
30 clerical or administrative error or oversight or pursuant to
31 a backpay order issued by an appropriate State or federal
32 administrative or judicial body or officer shall not be
33 construed as an additional payment for work already
34 performed.
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1 (d) Disbursements from appropriations which are subject
2 to the approval or certification of the Department of Central
3 Management Services are subject to the following
4 restrictions.
5 Payments for personal service except for positions
6 specified in all appropriation Acts shall be made in
7 conformity with schedules and amendments thereto submitted by
8 the respective officers and approved by the Department of
9 Central Management Services before becoming effective. Such
10 schedules and amendments thereto may set up groups of
11 employment showing the approximate number to be employed,
12 with fixed or minimum and maximum salary rates.
13 This Section is subject to the provisions of Section
14 9.02.
15 (Source: P.A. 86-11; 86-657; 86-1028.)