Public Act 90-0706 of the 90th General Assembly

State of Illinois
Public Acts
90th General Assembly

[ Home ] [ Public Acts ] [ ILCS ] [ Search ] [ Bottom ]

Public Act 90-0706

HB3081 Enrolled                                LRB9009642KDks

    AN ACT to amend the Illinois Municipal Code.

    Be it enacted by the People of  the  State  of  Illinois,
represented in the General Assembly:

    Section  5.  The  Illinois  Municipal  Code is amended by
changing Sections 8-4-1, 11-74.5-2, 11-74.5-3, and  11-74.5-5
as follows:

    (65 ILCS 5/8-4-1) (from Ch. 24, par. 8-4-1)
    Sec.  8-4-1.   No  bonds shall be issued by the corporate
authorities  of  any  municipality  until  the  question   of
authorizing  such bonds has been submitted to the electors of
that municipality, and approved by a majority of the electors
voting upon  that  question.  The  clerk  shall  certify  the
proposition  of  the  corporate  authorities  to  the  proper
election  authority  who  shall  submit  the  question  at an
election in accordance with the general election law.
    Notice of any such election shall contain the  amount  of
the bond issue, purpose for which issued, and maximum rate of
    However,  without  the  submission  of  the  question  of
issuing  bonds  to the electors, the corporate authorities of
any municipality may authorize the issuance  of  any  of  the
following bonds:
    (1)  Bonds to refund any existing bonded indebtedness;
    (2)  Bonds  to  fund  or  refund  any  existing  judgment
    (3)  In any municipality of less than 500,000 population,
bonds to anticipate the collection of installments of special
assessments  and  special taxes against property owned by the
municipality and to anticipate the collection of  the  amount
apportioned  to  the  municipality  as  public benefits under
Article 9;
    (4)  Bonds issued  by  any  municipality  under  Sections
8-4-15  through  8-4-23,  11-23-1  through  11-23-12, 11-25-1
through 11-26-6, 11-71-1 through 11-71-10, 11-74.4-1  through
11-74.4-11,  11-74.5-1  through  11-74.5-15,  11-94-1 through
11-94-7,  11-102-1  through  11-102-10,   11-103-11   through
11-103-15,   11-118-1   through  11-118-6,  11-119-1  through
11-119-5,  11-129-1  through   11-129-7,   11-133-1   through
11-133-4,   11-139-1   through  11-139-12,  11-141-1  through
11-141-18 of this  Code  or  10-801  through  10-808  of  the
Illinois Highway Code, as amended;
    (5)  Bonds issued by the board of education of any school
district under the provisions of Sections 34-30 through 34-36
of The School Code, as amended;
    (6)  Bonds   issued   by   any   municipality  under  the
provisions of Division 6  of  this  Article  8;  and  by  any
municipality  under  the  provisions  of  Division  7 of this
Article 8; or under the provisions of Sections  11-121-4  and
    (7)  Bonds  to pay for the purchase of voting machines by
any municipality that has adopted Article 24 of The  Election
Code, approved May 11, 1943, as amended;
    (8)  Bonds  issued  by any municipality under Sections 15
and 46 of the "Environmental Protection Act",  approved  June
29, 1970;
    (9)  Bonds  issued  by  the  corporate authorities of any
municipality under the provisions of Section 8-4-25  of  this
Article 8;
    (10)  Bonds issued under Section 8-4-26 of this Article 8
by any municipality having a board of election commissioners;
    (11)  Bonds  issued  under  the  provisions of "An Act to
provide the manner of  levying  or  imposing  taxes  for  the
provision  of special services to areas within the boundaries
of home  rule  units  and  nonhome  rule  municipalities  and
counties", approved September 21, 1973;
    (12)  Bonds issued under Section 8-5-16 of this Code;
    (13)  Bonds  to  finance  the  cost  of  the acquisition,
construction or improvement of water or wastewater  treatment
facilities  mandated  by  an  enforceable compliance schedule
developed in connection with the federal Clean Water Act or a
compliance order issued by the  United  States  Environmental
Protection  Agency  or  the Illinois Pollution Control Board;
provided that such  bonds  are  authorized  by  an  ordinance
adopted   by   a   three-fifths  majority  of  the  corporate
authorities of  the  municipality  issuing  the  bonds  which
ordinance  shall specify that the construction or improvement
of such facilities is necessary  to  alleviate  an  emergency
condition in such municipality;
    (14)  Bonds   issued  by  any  municipality  pursuant  to
Section 11-113.1-1;
    (15)  Bonds  issued  under  Sections  11-74.6-1   through
11-74.6-45, the Industrial Jobs Recovery Law of this Code.
(Source: P.A. 88-537.)

    (65 ILCS 5/11-74.5-2) (from Ch. 24, par. 11-74.5-2)
    Sec. 11-74.5-2. Whenever used in this Division:
    (a)  "Appraised  value"  means the fair market value of a
home  determined  in  accordance  with   generally   accepted
procedures  and standards applicable to the appraisal of real
    (b)  "Bonds" means any  revenue  bonds  authorized  under
this Division and payable as provided hereunder.
    (c)  "Corporate    authorities"   means   the   corporate
authorities as defined in this Illinois Municipal Code.
    (d)  "Home" means real property and improvements  thereon
located within the municipality consisting of not more than 4
dwelling  units,  including  but  not limited to, condominium
units owned by one  mortgagor  who  occupies  or  intends  to
occupy one of such units.
    (e)  "Home  mortgage loan" means an interest bearing loan
to a mortgagor evidenced by a promissory note and secured  by
a  first  mortgage  on  a  home,  purchased  or originated in
accordance  with  this  Division  made  for  the  purpose  of
acquiring a home having an  appraised  value  or  a  purchase
price,  whichever  is less, of not less than the minimum home
value and less than the maximum home value.
    (f)  "Lender" means any lending institution participating
in a residential housing finance plan as  the  originator  of
home mortgage loans or as a servicing agent for home mortgage
    (g)  "Lending  institution"  means any bank, bank holding
company, credit union, trust company, savings bank,  national
banking  association,  savings and loan association, building
and loan association,  mortgage  banker  or  other  financial
institution  which  customarily provides service or otherwise
aids in the financing  of  home  mortgages,  or  any  holding
company for any of the foregoing.
    (h)  "Maximum  home value" means the amount determined by
the corporate authorities.
    (i)  "Minimum home value" means the amount determined  by
the corporate authorities.
    (j)  "Mortgagor" means a person of low or moderate income
and  who has received or qualifies to receive a home mortgage
loan on a home.
    (k)  "Municipality" means a municipality  as  defined  in
this Illinois Municipal Code.
    (l)  "Ordinance"  means an ordinance adopted and approved
by the corporate authorities of a municipality.
    (m)  "Purchase price" means the actual consideration paid
to the seller of a home.
    (n)  "Person" means a natural  person  or  persons  or  a
trust,  provided  that  such  trust  is  for the benefit of a
natural person or members of such person's immediate family.

    (o)  "Participation commitment" means any undertaking  or
agreement  by  a  lending  institution  to participate in the
implementation of a residential housing finance plan.
    (p)  "Persons of low or moderate income" means  a  person
or  family  (consisting  of  one  or more persons all of whom
occupy or will occupy the home) whose aggregate gross  income
including  the  gross income of any co-signer or guarantor of
the promissory note made in connection with the making  of  a
home  mortgage  loan  does  not exceed a maximum amount to be
established by the corporate authorities  and  determined  in
accordance  with appropriate criteria, rules and regulations,
approved by the corporate authorities in connection with  the
implementation of a residential housing finance plan.
    (q)  "Residential  housing  finance plan" means a program
implemented under this Division by a municipality  to  assist
persons  of  low or moderate income in acquiring safe, decent
and sanitary housing which they can afford.
    (r)  "Trustee" means any State or national bank or  trust
company,  having  trust powers, located within or outside the
State of Illinois, which may  be  appointed  to  act  in  any
capacity  with  respect to a residential housing finance plan
and the issuance  of  bonds  to  finance  such  plan  whether
designated as a trustee, custodian or administrator.
(Source: P.A. 81-580.)

    (65 ILCS 5/11-74.5-3) (from Ch. 24, par. 11-74.5-3)
    Sec.   11-74.5-3.   In   addition   to   powers  which  a
municipality may now have, municipalities have the  following
    (a)  To  acquire,  and to contract and enter into advance
commitments  to  acquire,  directly   or   indirectly,   home
mortgages owned or originated by lending institutions at such
prices  and  upon such other terms and conditions as shall be
determined  by  such  municipality  or  trustee  as  it   may
designate as its agent;
    (b)  To   make   and   execute   contracts  with  lending
institutions  for  the  origination  and  servicing  of  home
mortgage loans on behalf of a municipality  and  to  pay  the
reasonable value of services rendered in accordance with such
    (c)  To  make  loans to lenders to enable such lenders to
make home mortgage loans in accordance with this Division;
    (d)  To establish, by rules or regulations, by ordinances
relating to  any  issuance  of  bonds  or  in  any  financing
documents  relating  to  such  issuance,  such  standards and
requirements applicable to  the  purchase  of  home  mortgage
loans  or  the origination of home mortgage loans or loans to
lenders as such municipality deems necessary or desirable  to
effectuate the public purposes of this Act, including but not
limited  to:  (i)  the time within which lending institutions
must make participation commitments  and  make  disbursements
for  home  mortgage  loans;  (ii) the terms and conditions of
home mortgage loans to be acquired or originated;  (iii)  the
standards  and  criteria to be applied by the municipality in
defining persons of low or moderate income; (iv) the  amounts
and  types  of  insurance  coverage  required  on homes, home
mortgage  loans  and  bonds;  (v)  the  representations   and
warranties to be required of persons and lending institutions
as   evidence   of   compliance   with   such  standards  and
requirements; (vi) restrictions as to interest rate and other
terms of home mortgage loans or the return realized therefrom
by  lending  institutions;  (vii)  the  type  and  amount  of
collateral security to be provided to assure repayment of any
loans  to  lenders  by  such  municipalities  and  to  assure
repayment of bonds;   and (viii) any other matters related to
the purchase or origination of home  mortgage  loans  or  the
making  of  loans  to  lenders as shall be deemed relevant or
necessary by the corporate authorities of such municipality.
    (e)  To require from each lending institution from  which
home  mortgage  loans  are  to  be  purchased  or  which will
originate home mortgage loans on behalf of  the  municipality
or  from  lenders to which loans are made, the submission, at
the time of making  participation  commitments,  of  evidence
satisfactory   to   such  municipality  of  the  ability  and
intention of such lending institution to make  home  mortgage
loans,  and the submission, within the time specified by such
municipality  for  making  disbursements  for  home  mortgage
loans, of evidence satisfactory to such municipality  of  the
making  of  home  mortgage  loans  and of compliance with any
standards and requirements established by such municipality.
    (f)  To require that  a  lending  institution  or  lender
furnish,  prior  to  or concurrently with the delivery of any
participation  commitment  by  a   lending   institution,   a
commitment  fee  in  the  form  of  a cash deposit, letter of
credit, promissory note,  surety  bond  or  other  instrument
approved  by  the  corporate  authorities  executed  by or on
behalf of such  lending  institution,  in  an  amount  to  be
determined by the corporate authorities.
    (g)  To  issue  its  bonds to defray, in whole or in part
(i) the cost of acquiring or originating home mortgage  loans
or  making  loans  to lenders in order to enable them to make
home mortgage loans;  (ii) if deemed necessary or  advisable,
the  costs  of  paying  interest on bonds during a reasonable
period necessary to acquire or originate  the  home  mortgage
loans  or  to  make  the loans to lender,  (iii) the costs of
studies and surveys, insurance premiums,  underwriting  fees,
legal,   accounting   and   marketing  services  incurred  in
connection  with  the  issuance  and  sale  of  such   bonds,
including  amounts required to establish reasonably necessary
bond and interest reserve accounts,  and  trustee,  custodian
and   rating  agency  fees;  (iv)  the  costs  of  reasonable
reserves; and (v) (iv) such other  costs  as  are  reasonably
related to the foregoing.
    (h)  To  authorize  the  sale or other disposition of any
home mortgage loan, in whole or in part, upon such terms,  at
such  prices  and  times,  and  from  time to time, as may be
necessary to assure that the  revenues  and  receipts  to  be
derived  with  respect  to  the home mortgage loans, together
with any insurance proceeds, funds held in  reserve  accounts
and  earnings thereon, shall produce and provide revenues and
receipts at  least  sufficient  to  provide  for  the  prompt
payment of the principal of, redemption premiums, if any, and
interest  at  maturity  of  all bonds issued pursuant to this
Division  or  to  otherwise  authorize  the  sale  or   other
disposition  of  any  home mortgage loan after the bonds have
been paid or deemed to be paid.
    (i)  To pledge any revenues and receipts to  be  received
from any home mortgage loans to the punctual payment of bonds
authorized   under   this  Division,  and  the  interest  and
redemption premiums, if any, thereon.
    (j)  To mortgage, pledge or grant security  interests  in
any  home mortgage loans, notes or other property in favor of
the holder or holders of bonds issued therefor.
    (k)  to  issue  its  bonds  in  such  amount  as  may  be
necessary (and not limited by the amount of  bonds  refunded)
for  the  purpose  of  refunding,  in whole or in part at any
time, bonds theretofore issued  by  such  municipality  under
authority  of  this Division, the proceeds of which refunding
bonds may  be  used,  at  the  discretion  of  the  corporate
authorities,  for paying bonds at maturity, calling bonds for
payment and paying bonds prior to maturity,  or  for  deposit
into  an escrow or trust fund in advance of maturity of bonds
to be held for payment thereof at maturity or earlier.
    (l)  To appoint or designate a trustee  or  trustees  for
the  benefit  of  the  bondholders and to delegate and assign
thereto, insofar as it may lawfully do so, its rights, duties
and  responsibilities  with  respect  to  carrying  out   and
enforcing the terms and provisions of its residential housing
finance plan.
    (m)  To provide for and authorize the use and disposition
of  any funds remaining in the possession of the municipality
(or  trustees)  following  payment  and  retirement  of,   or
following  the  making  of  provision for the payment of, the
bonds  of  a  designated  series  issued  pursuant  to   this
    (n)  To  make and execute contracts and other instruments
necessary or convenient to the exercise of any of the  powers
granted herein.
(Source: P.A. 84-550.)

    (65 ILCS 5/11-74.5-5) (from Ch. 24, par. 11-74.5-5)
    Sec. 11-74.5-5. The exercise of any or all powers granted
by  this  Division shall be authorized and the bonds shall be
authorized to be issued under this Division for the  purposes
set  forth  in  this  Act,  by  an  ordinance  adopted by the
corporate authorities of  a  municipality  which  shall  take
effect  immediately  upon  adoption. Any such ordinance shall
set forth a finding and declaration (i) of the public purpose
therefor and (ii) that such ordinance is adopted pursuant  to
this   Division,  which  finding  and  declaration  shall  be
conclusive evidence of the existence and sufficiency  of  the
public  purpose and of the power to carry out and give effect
to such public purposes.
    After the adoption of an ordinance as  provided  in  this
Section,   the   corporate  Authorities  shall  cause  to  be
submitted to the voters of  the  Municipality  the  question:
Shall  the  ordinance  adopted  by  the Corporate Authorities
providing for the sale of revenue  bonds  for  financing  the
purchase of homes in (name of municipality) take effect?
    If  a  majority  of  those  voting  on  the question vote
affirmatively, the ordinance takes effect and the bonds shall
be sold as provided in the ordinance.  If a majority of those
voting on the question vote negatively, the  ordinance  shall
not take effect.
    The  bonds  shall  bear  interest  at such  rate or rates
(subject only to the limitations set forth in  paragraph  (a)
of  Section  11-74.5-4  and  without  regard to any other law
pertaining to interest rate limitations), may be  payable  at
such  time  or  times, may be in one or more series, may bear
such date or dates, may mature at  such  time  or  times  not
exceeding  40  years  from  their  respective  dates,  may be
payable in such medium of payment at such  place  or  places,
may  carry  such  registration  privileges, may be subject to
such terms of redemption at such premiums, may be executed in
such manner, may contain such terms, covenants and conditions
and may be in such form, either coupon or registered, as  the
corporate  authorities  shall provide.  The bonds may be sold
at public or private sale at such price, in such  manner  and
upon  such  terms as the corporate authorities may determine.
Pending  the  preparation  of   definitive   bonds   and   in
anticipation  thereof,  interim  notes, in such form and with
such  provisions  as  may  be  authorized  by  the  corporate
authorities, may be issued to the purchaser or purchasers  of
bonds  sold pursuant to this Division.  The bonds and interim
notes  shall  be  deemed  to  be  securities  and  negotiable
instruments within the meaning and for all  purposes  of  the
Uniform Commercial Code.
(Source: P.A. 81-580.)

    (65 ILCS 5/11-74.5-4 rep.)
    Section  10.  The  Illinois  Municipal Code is amended by
repealing Section 11-74.5-4.

    Section 99.  Effective date.  This Act takes effect  upon
becoming law.

[ Top ]