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90_SB1866
50 ILCS 105/3 from Ch. 102, par. 3
65 ILCS 5/3.1-55-10
Amends the Public Officer Prohibited Activities Act and
the Illinois Municipal Code to allow governing bodies of a
municipality to contract with another entity in which a
member of the governing body is also an employee of that
entity which provides materials, merchandise, property,
services or labor.
SRS90S0083PMaw
SRS90S0083PMaw
1 AN ACT concerning municipal officers, amending named
2 Acts.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Public Officer Prohibited Activities Act
6 is amended by changing Section 105/3 as follows:
7 (50 ILCS 105/3) (from Ch. 102, par. 3)
8 Sec. 3. Prohibited interest in contracts.
9 (a) No person holding any office, either by election or
10 appointment under the laws or Constitution of this State, may
11 be in any manner financially interested directly in his own
12 name or indirectly in the name of any other person,
13 association, trust, or corporation, in any contract or the
14 performance of any work in the making or letting of which
15 such officer may be called upon to act or vote. No such
16 officer may represent, either as agent or otherwise, any
17 person, association, trust, or corporation, with respect to
18 any application or bid for any contract or work in regard to
19 which such officer may be called upon to vote. Nor may any
20 such officer take or receive, or offer to take or receive,
21 either directly or indirectly, any money or other thing of
22 value as a gift or bribe or means of influencing his vote or
23 action in his official character. Any contract made and
24 procured in violation hereof is void. This Section shall not
25 apply to any person serving on an advisory panel or
26 commission or to any director serving on a hospital district
27 board as provided under subsection (a-5) of Section 13 of the
28 Hospital District Law.
29 (b) However, any elected or appointed member of the
30 governing body may provide materials, merchandise, property,
31 services, or labor, subject to the following provisions under
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1 either paragraph (1) or (2):
2 (1) If:
3 A. the contract is with a person, firm,
4 partnership, association, corporation, or cooperative
5 association in which such interested member of the
6 governing body of the municipality has less than a 7 1/2%
7 share in the ownership; and
8 B. such interested member publicly discloses the
9 nature and extent of his interest prior to or during
10 deliberations concerning the proposed award of the
11 contract; and
12 C. such interested member abstains from voting on
13 the award of the contract, though he shall be considered
14 present for the purposes of establishing a quorum; and
15 D. such contract is approved by a majority vote of
16 those members presently holding office; and
17 E. the contract is awarded after sealed bids to the
18 lowest responsible bidder if the amount of the contract
19 exceeds $1500, or awarded without bidding if the amount
20 of the contract is less than $1500; and
21 F. the award of the contract would not cause the
22 aggregate amount of all such contracts so awarded to the
23 same person, firm, association, partnership, corporation,
24 or cooperative association in the same fiscal year to
25 exceed $25,000.,
26 (2) If:
27 A. the award of the contract is approved by a
28 majority vote of the governing body of the municipality
29 provided that any such interested member shall abstain
30 from voting; and
31 B. the amount of the contract does not exceed
32 $2,000; and
33 C. the award of the contract would not cause the
34 aggregate amount of all such contracts so awarded to the
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1 same person, firm, association, partnership, corporation,
2 or cooperative association in the same fiscal year to
3 exceed $4,000; and
4 D. such interested member publicly discloses the
5 nature and extent of his interest prior to or during
6 deliberations concerning the proposed award of the
7 contract; and
8 E. such interested member abstains from voting on
9 the award of the contract, though he shall be considered
10 present for the purposes of establishing a quorum.
11 (b-5) In addition to the above exemptions, any elected
12 or appointed member of the governing body may provide
13 materials, merchandise, property, services, or labor if:
14 A. the contract is with a person, firm,
15 partnership, association, corporation, or cooperative
16 association in which the interested member of the
17 governing body of the municipality, advisory panel, or
18 commission is an employee of or has less than a 1% share
19 in the ownership; and
20 B. the award of the contract is approved by a
21 majority vote of the governing body of the municipality
22 provided that any such interested member shall abstain
23 from voting; and
24 C. such interested member publicly discloses the
25 nature and extent of his interest before or during
26 deliberations concerning the proposed award of the
27 contract; and
28 D. such interested member abstains from voting on
29 the award of the contract, though he shall be considered
30 present for the purposes of establishing a quorum.
31 (c) A contract for the procurement of public utility
32 services by a public entity with a public utility company is
33 not barred by this Section by one or more members of the
34 governing body of the public entity being an officer or
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1 employee of the public utility company or holding an
2 ownership interest of no more than 7 1/2% in the public
3 utility company, or holding an ownership interest of any size
4 if the public entity is a municipality with a population of
5 less than 7,500 and the public utility's rates are approved
6 by the Illinois Commerce Commission. An elected or appointed
7 member of the governing body of the public entity having such
8 an interest shall be deemed not to have a prohibited interest
9 under this Section.
10 (d) Notwithstanding any other provision of this Section
11 or any other law to the contrary, until January 1, 1994, a
12 member of the city council of a municipality with a
13 population under 20,000 may purchase real estate from the
14 municipality, at a price of not less than 100% of the value
15 of the real estate as determined by a written MAI certified
16 appraisal or by a written certified appraisal of a State
17 certified or licensed real estate appraiser, if the purchase
18 is approved by a unanimous vote of the city council members
19 then holding office (except for the member desiring to
20 purchase the real estate, who shall not vote on the
21 question).
22 (e) For the purposes of this Section only, a municipal
23 officer shall not be deemed interested if the officer is an
24 employee of a company or owns or holds an interest of 1% or
25 less in the municipal officer's individual name in a company,
26 or both, that company is involved in the transaction of
27 business with the municipality, and that company's stock is
28 traded on a nationally recognized securities market, provided
29 the interested member: (i) publicly discloses the fact that
30 he or she is an employee or holds an interest of 1% or less
31 in a company before deliberation of the proposed award of the
32 contract; (ii) refrains from evaluating, recommending,
33 approving, deliberating, or otherwise participating in
34 negotiation, approval, or both, of the contract, work, or
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1 business; (iii) abstains from voting on the award of the
2 contract though he or she shall be considered present for
3 purposes of establishing a quorum; and (iv) the contract is
4 approved by a majority vote of those members currently
5 holding office.
6 A municipal officer shall not be deemed interested if the
7 officer owns or holds an interest of 1% or less, not in the
8 officer's individual name but through a mutual fund, in a
9 company, that company is involved in the transaction of
10 business with the municipality, and that company's stock is
11 traded on a nationally recognized securities market.
12 (Source: P.A. 90-197, eff. 1-1-98; 90-364, eff, 1-1-98;
13 revised 10-28-97.)
14 Section 10. The Illinois Municipal Code is amended by
15 changing Section 3.1-55-10 as follows:
16 (65 ILCS 5/3.1-55-10)
17 Sec. 3.1-55-10. Interests in contracts.
18 (a) A municipal officer shall not be financially
19 interested directly in the officer's own name or indirectly
20 in the name of any other person, association, trust, or
21 corporation, in any contract, work, or business of the
22 municipality or in the sale of any article whenever the
23 expense, price, or consideration of the contract, work,
24 business, or sale is paid either from the treasury or by an
25 assessment levied by statute or ordinance. A municipal
26 officer shall not be interested, directly or indirectly, in
27 the purchase of any property that (i) belongs to the
28 municipality, (ii) is sold for taxes or assessments, or (iii)
29 is sold by virtue of legal process at the suit of the
30 municipality. For the purposes of this Section only,
31 however, a municipal officer shall not be deemed interested
32 if the officer is an employee of a company or owns or holds
33 an interest of 1% or less in the municipal officer's
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1 individual name in a company, or both, that company is
2 involved in the transaction of business with the
3 municipality, and that company's stock is traded on a
4 nationally recognized securities market, provided the
5 interested member (i) publicly discloses the fact that he or
6 she is an employee or holds an interest of 1% of less in a
7 company before deliberation of the proposed award of the
8 contract; (ii) refrains from evaluating, recommending,
9 approving, deliberating, or otherwise participating in the
10 negotiation, approval, or both, of the contract, work, or
11 business; (iii) abstains from voting on the award of the
12 contract though he or she shall be considered present for
13 purposes of establishing a quorum; and (iv) the contract is
14 approved by a majority vote of those members currently
15 holding office.
16 A municipal officer shall not be deemed interested if the
17 officer owns or holds an interest of 1% or less, not in the
18 officer's individual name but through a mutual fund, in a
19 company, that company is involved in the transaction of
20 business with the municipality, and that company's stock is
21 traded on a nationally recognized securities market.
22 This Section does not prohibit any person serving on a
23 municipal advisory panel or commission or nongoverning board
24 or commission from having an interest in a contract, work, or
25 business of the municipality unless the municipal officer's
26 duties include evaluating, recommending, approving, or voting
27 to recommend or approve the contract, work, or business.
28 (b) Any elected or appointed member of the governing
29 body may, however, provide materials, merchandise, property,
30 services, or labor, subject to the following provisions under
31 either (1) or (2)
32 (1) If:
33 (A) the contract is with a person, firm,
34 partnership, association, corporation, or cooperative
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1 association in which the interested member of the
2 governing body of the municipality member has less than a
3 7 1/2% share in the ownership;
4 (B) the interested member publicly discloses the
5 nature and extent of the interest before or during
6 deliberations concerning the proposed award of the
7 contract;
8 (C) the interested member abstains from voting on
9 the award of the contract (though the member shall be
10 considered present for the purposes of establishing a
11 quorum);
12 (D) the contract is approved by a majority vote of
13 those members presently holding office;
14 (E) the contract is awarded after sealed bids to
15 the lowest responsible bidder if the amount of the
16 contract exceeds $1,500 (but the contract may be awarded
17 without bidding if the amount is less than $1,500); and
18 (F) the award of the contract would not cause the
19 aggregate amount of all contracts so awarded to the same
20 person, firm, association, partnership, corporation, or
21 cooperative association in the same fiscal year to exceed
22 $25,000.
23 (2) If:
24 (A) the award of the contract is approved by a
25 majority vote of the governing body of the municipality
26 (provided that the interested member shall abstain from
27 voting);
28 (B) the amount of the contract does not exceed
29 $2,000;
30 (C) the award of the contract would not cause the
31 aggregate amount of all contracts so awarded to the same
32 person, firm, association, partnership, corporation, or
33 cooperative association in the same fiscal year to exceed
34 $4,000;
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1 (D) the interested member publicly discloses the
2 nature and extent of his interest before or during
3 deliberations concerning the proposed award of the
4 contract; and
5 (E) the interested member abstains from voting on
6 the award of the contract (though the member shall be
7 considered present for the purposes of establishing a
8 quorum).
9 (b-5) In addition to the above exemptions, any elected
10 or appointed member of the governing body may provide
11 materials, merchandise, property, services, or labor if:
12 (1) the contract is with a person, firm,
13 partnership, association, corporation, or cooperative
14 association in which the interested member of the
15 governing body of the municipality, advisory panel, or
16 commission is an employee of or has less than a 1% share
17 in the ownership; and
18 (2) the award of the contract is approved by a
19 majority vote of the governing body of the municipality
20 provided that any such interested member shall abstain
21 from voting; and
22 (3) such interested member publicly discloses the
23 nature and extent of his interest before or during
24 deliberations concerning the proposed award of the
25 contract; and
26 (4) such interested member abstains from voting on
27 the award of the contract, though he shall be considered
28 present for the purposes of establishing a quorum.
29 (c) A contract for the procurement of public utility
30 services by a municipality with a public utility company is
31 not barred by this Section by one or more members of the
32 governing body being an officer or employee of the public
33 utility company, or holding an ownership interest in no more
34 than 7 1/2% in the public utility company, or holding an
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1 ownership interest of any size if the municipality has a
2 population of less than 7,500 and the public utility's rates
3 are approved by the Illinois Commerce Commission. An elected
4 or appointed member of the governing body or a nongoverning
5 board or commission having an interest described in this
6 subsection (d) does not have a prohibited interest under this
7 Section.
8 (d) An officer who violates this Section is guilty of a
9 Class 4 felony. In addition, any office held by an officer
10 so convicted shall become vacant and shall be so declared as
11 part of the judgment of the court.
12 (e) Nothing contained in this Section, including the
13 restrictions set forth in subsections (b) and (c), shall
14 preclude a contract of deposit of moneys, loans, or other
15 financial services by a municipality with a local bank or
16 local savings and loan association, regardless of whether a
17 member of the governing body of the municipality is
18 interested in the bank or savings and loan association as an
19 officer or employee or as a holder of less than 7 1/2% of the
20 total ownership interest. A member holding an interest
21 described in this subsection (e) in a contract does not hold
22 a prohibited interest for purposes of this Act. The
23 interested member of the governing body must publicly state
24 the nature and extent of the interest during deliberations
25 concerning the proposed award of the contract but shall not
26 participate in any further deliberations concerning the
27 proposed award. The interested member shall not vote on the
28 proposed award. A member abstaining from participation in
29 deliberations and voting under this Section may be considered
30 present for purposes of establishing a quorum. Award of the
31 contract shall require approval by a majority vote of those
32 members presently holding office. Consideration and award of
33 a contract in which a member is interested may only be made
34 at a regularly scheduled public meeting of the governing body
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1 of the municipality.
2 (f) Notwithstanding any other provision of this Section
3 or any other law to the contrary, until January 1, 1994, a
4 member of the city council of a municipality with a
5 population under 20,000 may purchase real estate from the
6 municipality, at a price of not less than 100% of the value
7 of the real estate as determined by a written MAI certified
8 appraisal or by a written certified appraisal of a State
9 certified or licensed real estate appraiser, if the purchase
10 is approved by a unanimous vote of the city council members
11 then holding office (except for the member desiring to
12 purchase the real estate, who shall not vote on the
13 question).
14 (Source: P.A. 90-364, eff. 1-1-98.)