Public Act 90-0595 of the 90th General Assembly
Public Act 90-0595
HB2748 Enrolled LRB9010787JMmb
AN ACT to amend the Intergovernmental Cooperation Act by
changing Section 3.1.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Intergovernmental Cooperation Act is
amended by changing Section 3.1 as follows:
(5 ILCS 220/3.1) (from Ch. 127, par. 743.1)
Sec. 3.1. Municipal Joint Action Water Agency.
(a) Any municipality or municipalities of this State, any
county or counties of this State, any township in a county
with a population under 700,000 of this State, any public
water district or districts of this State, or any combination
thereof may, by intergovernmental agreement, establish a
Municipal Joint Action Water Agency to provide adequate
supplies of water on an economical and efficient basis for
member municipalities, public water districts and other
incorporated and unincorporated areas within such counties.
For purposes of this Act, the water supply may only be
derived from Lake Michigan, the Mississippi River, or the
Missouri River, or the Sangamon River Valley Alluvium. Any
such Agency shall itself be a municipal corporation, public
body politic and corporate. A Municipal Joint Action Water
Agency so created shall not itself have taxing power except
as hereinafter provided.
A Municipal Joint Action Water Agency shall be
established by an intergovernmental agreement among the
various member municipalities, public water districts,
townships, and counties, upon approval by an ordinance
adopted by the corporate authorities of each member
municipality, public water district, township, or county.
This agreement may be amended at any time upon the adoption
of concurring ordinances by the corporate authorities of all
member municipalities, public water districts, townships, and
counties. The agreement may provide for additional
municipalities, public water districts, townships in counties
with a population under 700,000, or counties to join the
Agency upon adoption of an ordinance by the corporate
authorities of the joining municipality, public water
district, township, or county, and upon such consents,
conditions and approvals of the governing body of the
Municipal Joint Action Water Agency and of existing member
municipalities, public water districts, townships, and
counties as shall be provided in the agreement. The
agreement shall provide the manner and terms on which any
municipality, public water district, township, or county may
withdraw from membership in the Municipal Joint Action Water
Agency and on which the Agency may terminate and dissolve in
whole or in part. The agreement shall set forth the
corporate name of the Municipal Joint Action Water Agency and
its duration. Promptly upon any agreement establishing a
Municipal Joint Action Water Agency being entered into, or
upon the amending of any such agreement, a copy of such
agreement or amendment shall be filed in the office of the
Secretary of State of Illinois. Promptly upon the addition
or withdrawal of any municipality, public water district,
township in a county with a population under 700,000, or
county, or upon the dissolution of a Municipal Joint Action
Water Agency, that fact shall be certified by an officer of
the Agency to the Secretary of State of Illinois.
(b) The governing body of any Municipal Joint Action
Water Agency established pursuant to this Section 3.1 shall
be a Board of Directors. There shall be one Director from
each member municipality, public water district, township,
and county of the Municipal Joint Action Water Agency
appointed by ordinance of the corporate authorities of the
municipality, public water district, township, or county.
Each Director shall have one vote. Each Director shall be the
Mayor or President of the member municipality, or the
chairman of the board of trustees of the member public water
district, the supervisor of the member township, or the
chairman of the county board or chief executive officer of
the member county or a county board member appointed by the
chairman of the county board of the member county, appointing
the Director; an elected member of the corporate authorities
of that municipality, public water district, township, or
county; or other elected official of the appointing
municipality, public water district, township, or county.
Any agreement establishing a Municipal Joint Action Water
Agency shall specify the period during which a Director shall
hold office and may provide for the appointment of Alternate
Directors from member municipalities, public water districts,
townships, or counties. The Board of Directors shall elect
one Director to serve as Chairman, and shall elect persons,
who need not be Directors, to such other offices as shall be
designated in the agreement.
The Board of Directors shall determine the general policy
of the Municipal Joint Action Water Agency, shall approve the
annual budget, shall make all appropriations (which may
include appropriations made at any time in addition to those
made in any annual appropriation document), shall approve all
contracts for the purchase or sale of water, shall adopt any
resolutions providing for the issuance of bonds or notes by
the Agency, shall adopt its by-laws, rules and regulations,
and shall have such other powers and duties as may be
prescribed in the agreement. Such agreement may further
specify those powers and actions of the Municipal Joint
Action Water Agency which shall be authorized only upon votes
of greater than a majority of all Directors or only upon
consents of the corporate authorities of a certain number of
member municipalities, public water districts, townships, or
counties.
The agreement may provide for the establishment of an
Executive Committee to consist of the municipal manager or
other elected or appointed official of each member
municipality, public water district, township, or county, as
designated by ordinance from time to time by the corporate
authorities of the member municipality, public water
district, township, or county, and may prescribe powers and
duties of the Executive Committee for the efficient
administration of the Agency.
(c) A Municipal Joint Action Water Agency established
pursuant to this Section 3.1 may plan, construct, improve,
extend, acquire, finance (including the issuance of revenue
bonds or notes as provided in this Section 3.1), operate,
maintain, and contract for a joint waterworks or water supply
system which may include, or may consist of, without
limitation, facilities for receiving, storing, and
transmitting water from any source for supplying water to
member municipalities, public water districts, townships, or
counties (including county special service areas created
under the Special Service Area Tax Act and county service
areas authorized under the Counties Code), or other public
agencies, persons, or corporations. Facilities of the
Municipal Joint Action Water Agency may be located within or
without the corporate limits of any member municipality.
A Municipal Joint Action Water Agency shall have such
powers as shall be provided in the agreement establishing it,
which may include, but need not be limited to, the following
powers:
(i) to sue or be sued;
(ii) to apply for and accept gifts or grants or
loans of funds or property or financial or other aid from
any public agency or private entity;
(iii) to acquire, hold, sell, lease as lessor or
lessee, transfer or dispose of such real or personal
property, or interests therein, as it deems appropriate
in the exercise of its powers, and to provide for the use
thereof by any member municipality, public water
district, township, or county;
(iv) to make and execute all contracts and other
instruments necessary or convenient to the exercise of
its powers (including contracts with member
municipalities, with public water districts, with
townships, and with counties on behalf of county service
areas); and
(v) to employ agents and employees and to delegate
by resolution to one or more of its Directors or officers
such powers as it may deem proper.
Member municipalities, public water districts, townships,
or counties may, for the purposes of, and upon request by,
the Municipal Joint Action Water Agency, exercise the power
of eminent domain available to them, convey property so
acquired to the Agency for the cost of acquisition, and be
reimbursed for all expenses related to this exercise of
eminent domain power on behalf of the Agency.
All property, income and receipts of or transactions by a
Municipal Joint Action Water Agency shall be exempt from all
taxation, the same as if it were the property, income or
receipts of or transaction by the member municipalities,
public water districts, townships, or counties.
(d) A Municipal Joint Action Water Agency established
pursuant to this Section 3.1 shall have the power to buy
water and to enter into contracts with any person,
corporation or public agency (including any member
municipality, public water district, township, or county) for
that purpose. Any such contract made by an Agency for a
supply of water may contain provisions whereby the Agency is
obligated to pay for the supply of water without setoff or
counterclaim and irrespective of whether the supply of water
is ever furnished, made available or delivered to the Agency
or whether any project for the supply of water contemplated
by any such contract is completed, operable or operating and
notwithstanding any suspension, interruption, interference,
reduction or curtailment of the supply of water from such
project. Any such contract may provide that if one or more
of the other purchasers defaults in the payment of its
obligations under such contract or a similar contract made
with the supplier of the water one or more of the remaining
purchasers party to such contract or such similar contract
shall be required to pay for all or a portion of the
obligations of the defaulting purchasers. No such contract
may have a term in excess of 50 years.
A Municipal Joint Action Water Agency shall have the
power to sell water and to enter into contracts with any
person, corporation or public agency (including any member
municipality, any public water district, any township, or any
county on behalf of a county service area as set forth in
this Section) for that purpose. No such contract may have a
term in excess of 50 years. Any such contract entered into
to sell water to a public agency may provide that the
payments to be made thereunder by such public agency shall be
made solely from revenues to be derived by such public agency
from the operation of its waterworks system or its combined
waterworks and sewerage system. Any public agency so
contracting to purchase water shall establish from time to
time such fees and charges for its water service or combined
water and sewer service as will produce revenues sufficient
at all times to pay its obligations to the Agency under the
purchase contract. Any such contract so providing shall not
constitute indebtedness of such public agency so contracting
to buy water within the meaning of any statutory or
constitutional limitation. Any such contract of a public
agency to buy water shall be a continuing, valid and binding
obligation of such public agency payable from such revenues.
A Municipal Joint Action Water Agency shall establish
fees and charges for the purchase of water from it or for the
use of its facilities. No prior appropriation shall be
required by either the Municipal Joint Action Water Agency or
any public agency before entering into any contract
authorized by this paragraph (d).
The changes in this Section made by this amendatory Act
of 1984 are intended to be declarative of existing law.
(e) 1. A Municipal Joint Action Water Agency established
pursuant to this Section 3.1 may, from time to time, borrow
money and, in evidence of its obligation to repay the
borrowing, issue its negotiable water revenue bonds or notes
pursuant to this paragraph (e) for any of the following
purposes: for paying costs of constructing, acquiring,
improving or extending a joint waterworks or water supply
system; for paying other expenses incident to or incurred in
connection with such construction, acquisition, improvement
or extension; for repaying advances made to or by the Agency
for such purposes; for paying interest on the bonds or notes
until the estimated date of completion of any such
construction, acquisition, improvement or extension and for
such period after the estimated completion date as the Board
of Directors of the Agency shall determine; for paying
financial, legal, administrative and other expenses of the
authorization, issuance, sale or delivery of bonds or notes;
for paying costs of insuring payment of the bonds or notes;
for providing or increasing a debt service reserve fund with
respect to any or all of the Agency's bonds or notes; and for
paying, refunding or redeeming any of the Agency's bonds or
notes before, after or at their maturity, including paying
redemption premiums or interest accruing or to accrue on such
bonds or notes being paid or redeemed or for paying any other
costs in connection with any such payment or redemption.
2. Any bonds or notes issued pursuant to this paragraph
(e) by a Municipal Joint Action Water Agency shall be
authorized by a resolution of the Board of Directors of the
Agency adopted by the affirmative vote of Directors from a
majority of the member municipalities, public water
districts, townships, and counties, and any additional
requirements as may be set forth in the agreement
establishing the Agency. The authorizing resolution may be
effective immediately upon its adoption. The authorizing
resolution shall describe in a general way any project
contemplated to be financed by the bonds or notes, shall set
forth the estimated cost of the project and shall determine
its period of usefulness. The authorizing resolution shall
determine the maturity or maturities of the bonds or notes,
the rate or rates at which the bonds or notes are to bear
interest and all the other terms and details of the bonds or
notes. All such bonds or notes shall mature within the
period of estimated usefulness of the project with respect to
which such bonds or notes are issued, as determined by the
Board of Directors, but in any event not more than 50 years
from their date of issue. The bonds and notes may bear
interest, payable at such times, at a rate or rates not
exceeding the maximum rate established in the Bond
Authorization Act, as from time to time in effect. Bonds or
notes of a Municipal Joint Action Water Agency shall be sold
in such manner as the Board of Directors of the Agency shall
determine, either at par or at a premium or discount, but
such that the effective interest cost (excluding any
redemption premium) to the Agency of the bonds or notes shall
not exceed a rate equal to the rate of interest specified in
the Act referred to in the preceding sentence.
The resolution authorizing the issuance of any bonds or
notes pursuant to this paragraph (e) shall constitute a
contract with the holders of the bonds and notes. The
resolution may contain such covenants and restrictions with
respect to the purchase or sale of water by the Agency and
the contracts for such purchases or sales, the operation of
the joint waterworks system or water supply system, the
issuance of additional bonds or notes by the Agency, the
security for the bonds and notes, and any other matters, as
may be deemed necessary or advisable by the Board of
Directors to assure the payment of the bonds or notes of the
Agency.
3. The resolution authorizing the issuance of bonds or
notes by a Municipal Joint Action Water Agency shall pledge
and provide for the application of revenues derived from the
operation of the Agency's joint waterworks or water supply
system (including from contracts for the sale of water by the
Agency) and investment earnings thereon to the payment of the
cost of operation and maintenance of the system (including
costs of purchasing water), to provision of adequate
depreciation, reserve or replacement funds with respect to
the system or the bonds or notes, and to the payment of
principal, premium, if any, and interest on the bonds or
notes of the Agency (including amounts for the purchase of
such bonds or notes). The resolution shall provide that
revenues of the Municipal Joint Action Water Agency so
derived from the operation of the system, sufficient
(together with other receipts of the Agency which may be
applied to such purposes) to provide for such purposes, shall
be set aside as collected in a separate fund or funds and
used for such purposes. The resolution may provide that
revenues not required for such purposes may be used for any
proper purpose of the Agency or may be returned to member
municipalities.
Any notes of a Municipal Joint Action Water Agency issued
in anticipation of the issuance of bonds by it may, in
addition, be secured by a pledge of proceeds of bonds to be
issued by the Agency, as specified in the resolution
authorizing the issuance of such notes.
4. (i) Except as provided in clauses (ii) and (iii) of
this subparagraph 4 of this paragraph (e), all bonds and
notes of the Municipal Joint Action Water Agency issued
pursuant to this paragraph (e) shall be revenue bonds or
notes. Such revenue bonds or notes shall have no claim for
payment other than from revenues of the Agency derived from
the operation of its joint waterworks or water supply system
(including from contracts for the sale of water by the
Agency) and investment earnings thereon, from bond or note
proceeds and investment earnings thereon, or from such other
receipts of the Agency as the agreement establishing the
Agency may authorize to be pledged to the payment of revenue
bonds or notes, all as and to the extent as provided in the
resolution of the Board of Directors authorizing the issuance
of the revenue bonds or notes. Revenue bonds or notes issued
by a Municipal Joint Action Water Agency pursuant to this
paragraph (e) shall not constitute an indebtedness of the
Agency or of any member municipality, public water district,
township, or county within the meaning of any constitutional
or statutory limitation. It shall be plainly stated on each
revenue bond and note that it does not constitute an
indebtedness of the Municipal Joint Action Water Agency or of
any member municipality, public water district, township, or
county within the meaning of any constitutional or statutory
limitation.
(ii) If the Agreement so provides and subject to the
referendum provided for in clause (iii) of this subparagraph
4 of this paragraph (e), the Municipal Joint Action Water
Agency may borrow money for corporate purposes on the credit
of the Municipal Joint Action Water Agency, and issue general
obligation bonds therefor, in such amounts and form and on
such conditions as it shall prescribe, but shall not become
indebted in any manner or for any purpose in an amount
including existing indebtedness in the aggregate which
exceeds 5.75% of the aggregate value of the taxable property
within the boundaries of the participating municipalities,
public water districts, townships, and county service areas
within a member county determined by the governing body of
the county by resolution to be served by the Municipal Joint
Action Water Agency (including any territory added to the
Agency after the issuance of such general obligation bonds),
collectively defined as the "Service Area", as equalized and
assessed by the Department of Revenue and as most recently
available at the time of the issue of said bonds. Before or
at the time of incurring any such general obligation
indebtedness, the Municipal Joint Action Water Agency shall
provide for the collection of a direct annual tax, which
shall be unlimited as to rate or amount, sufficient to pay
the interest on such debt as it falls due and also to pay and
discharge the principal thereof at maturity, which shall be
within 40 years after the date of issue thereof. Such tax
shall be levied upon and collected from all of the taxable
property within the territorial boundaries of such Service
Area at the time of the referendum provided for in clause
(iii) and shall be levied upon and collected from all taxable
property within the boundaries of any territory subsequently
added to the Service Area. Dissolution of the Municipal
Joint Action Water Agency for any reason shall not relieve
the taxable property within such Service Area from liability
for such tax. Liability for such tax for property transferred
to or released from such Service Area shall be determined in
the same manner as for general obligation bonds of such
county, if in an unincorporated area, and of such
municipality, if within the boundaries thereof. The clerk or
other officer of the Municipal Joint Action Water Agency
shall file a certified copy of the resolution or ordinance by
which such bonds are authorized to be issued and such tax is
levied with the County Clerk or Clerks of the county or
counties containing the Service Area, and such filing shall
constitute, without the doing of any other act, full and
complete authority for such County Clerk or Clerks to extend
such tax for collection upon all the taxable property within
the Service Area subject to such tax in each and every year,
as required, in amounts sufficient to pay the principal of
and interest on such bonds, as aforesaid, without limit as to
rate or amount. Such tax shall be in addition to and in
excess of all other taxes authorized to be levied by the
Municipal Joint Action Water Agency or by such county,
municipality, township, or public water district. The
issuance of such general obligation bonds shall be subject to
the other provisions of this paragraph (e), except for the
provisions of clause (i) of this subparagraph 4.
(iii) No issue of general obligation bonds of the
Municipal Joint Action Water Agency (except bonds to refund
an existing bonded indebtedness) shall be authorized unless
the Municipal Joint Action Water Agency certifies the
proposition of issuing such bonds to the proper election
authorities, who shall submit the proposition to the voters
in the Service Area at an election in accordance with the
general election law, and the proposition has been approved
by a majority of those voting on the proposition.
The proposition shall be substantially in the following
form:
-------------------------------------------------------------
Shall general obligation
bonds for the purpose of (state
purpose), in the sum not to
exceed $....(insert amount), Yes
be issued by the ......... ------------------------
(insert corporate name of the No
Municipal Joint Action Water
Agency)?
-------------------------------------------------------------
5. As long as any bonds or notes of a Municipal Joint
Action Water Agency created pursuant to this Section 3.1 are
outstanding and unpaid, the Agency shall not terminate or
dissolve and, except as permitted by the resolution or
resolutions authorizing outstanding bonds or notes, no member
municipality, public water district, township, or county may
withdraw from the Agency. While any such bonds or notes are
outstanding, all contracts for the sale of water by the
Agency to member municipalities, public water districts,
townships, or counties shall be irrevocable except as
permitted by the resolution or resolutions authorizing such
bonds or notes. The Agency shall establish fees and charges
for its operations sufficient to provide adequate revenues to
meet all of the requirements under its various resolutions
authorizing bonds or notes.
6. A holder of any bond or note issued pursuant to this
paragraph (e) may, in any civil action, mandamus or other
proceeding, enforce and compel performance of all duties
required to be performed by the Agency or such counties, as
provided in the authorizing resolution, or by any of the
public agencies contracting with the Agency to purchase
water, including the imposition of fees and charges, the
collection of sufficient revenues and the proper application
of revenues as provided in this paragraph (e) and the
levying, extension and collection of such taxes.
7. In addition, the resolution authorizing any bonds or
notes issued pursuant to this paragraph (e) may provide for a
pledge, assignment, lien or security interest, for the
benefit of the holders of any or all bonds or notes of the
Agency, (i) on any or all revenues derived from the operation
of the joint waterworks or water supply system (including
from contracts for the sale of water) and investment earnings
thereon or (ii) on funds or accounts securing the payment of
the bonds or notes as provided in the authorizing resolution.
In addition, such a pledge, assignment, lien or security
interest may be made with respect to any receipts of the
Agency which the agreement establishing the Agency authorizes
it to apply to payment of bonds or notes. Any such pledge,
assignment, lien or security interest for the benefit of
holders of bonds or notes shall be valid and binding from the
time the bonds or notes are issued, without any physical
delivery or further act, and shall be valid and binding as
against or prior to any claims of any other party having any
claims of any kind against the Agency irrespective of whether
such other parties have notice of such pledge, assignment,
lien or security interest.
A resolution of a Municipal Joint Water Agency
authorizing the issuance of bonds or notes pursuant to this
paragraph (e) may provide for the appointment of a corporate
trustee with respect to any or all of such bonds or notes
(which trustee may be any trust company or state or national
bank having the power of a trust company within Illinois).
In that event, the resolution shall prescribe the rights,
duties and powers of the trustee to be exercised for the
benefit of the Agency and the protection of the holders of
such bonds or notes. The resolution may provide for the
trustee to hold in trust, invest and use amounts in funds and
accounts created as provided in the resolution. The
resolution authorizing the bonds or notes may provide for the
assignment and direct payment to the trustee of amounts owed
by public agencies to the Municipal Joint Action Water Agency
under water sales contracts for application by the trustee to
the purposes for which such revenues are to be used as
provided in this paragraph (e) and as provided in the
authorizing resolution. Upon receipt of notice of such
assignment, the public agency shall thereafter make the
assigned payments directly to such trustee.
Nothing in this Section authorizes a Joint Action Water
Agency to provide water service directly to residents within
a municipality or in territory within one mile or less of the
corporate limits of a municipality that operates a public
water supply unless the municipality has consented in writing
to such service being provided.
Nothing in this Act prohibits a Joint Action Water Agency
from providing water service to all residents of member
municipalities and to all persons who have executed
pre-annexation agreements with any member municipality.
(Source: P.A. 90-210, eff. 7-25-97.)