(70 ILCS 2405/9.2) (from Ch. 42, par. 308.2)

Sec. 9.2.

In addition to the powers and authority now possessed by it,
the board of trustees of any sanitary district organized under this Act
shall have the power by majority vote:

(a) To use the general funds of the sanitary district to defend,
indemnify and hold harmless, in whole or in part, the board of trustees,
members of the board of trustees, officials and employees of the sanitary
district, including former members of the board of trustees and former
officials and employees, from financial loss and expenses, including court
costs, investigation costs, actuarial studies, attorneys' fees and actual
and punitive damages, arising out of any proceedings (including but not
limited to proceedings alleging antitrust violations or the deprivation of
civil or constitutional rights), claims, demands or judgments instituted,
made or entered against such board, trustee, official or employee by reason
of its or his statements, acts or omissions, provided that such statements,
acts or omissions occur within the scope of employment of such board,
trustee, official or employee; and provided, further, that no sanitary
district shall elect to indemnify any member of the board of trustees,
officer, or employee for any portion of a judgment representing an award of
punitive or exemplary damages unless the statements, acts, or omissions
giving rise to such judgment do not constitute wilful and wanton misconduct.

(b) (i) To obtain and provide for any or all of the matters and purposes
described in paragraph (a) public officials' liability, comprehensive
general liability and such other forms of insurance coverage as the board
of trustees shall determine necessary or advisable, any insurance so
obtained and provided to be carried in a company or companies licensed
to write such coverage in this State, and (ii) to establish and provide for
any or all of the matters and purposes described in paragraph (a) a program
of self-insurance and, in furtherance thereof, to establish and accumulate
reserves for the payment of financial loss and expenses, including court
costs, investigation costs, actuarial studies, attorneys' fees and actual
and punitive damages associated with liabilities arising out of civil
proceedings, claims, demands or judgments instituted, made or entered as
set forth in paragraph (a), and (iii) in connection with providing for any
or all of the matters and purposes described in paragraph (a) and when
permitted by law to enter into an agreement with any special district, unit
of government, person or corporation for the use of property or the
performance of any function, service or act, to agree to the sharing or
allocation of liabilities and damages resulting from such use of property
or performance of function, service or act, in which event such agreement
may provide for contribution or indemnification by any or all of the
parties to the agreement upon any liability arising out of the performance
of the agreement.

If the board of trustees of any sanitary district organized under this
Act undertakes to provide insurance or to establish a program of
self-insurance and to establish and accumulate reserves for any or all of
the matters and purposes described in paragraph (a), such reserves shall be
established and accumulated for such matters and purposes subject to the
following conditions:

(1) The amount of such reserves shall not exceed the amount necessary and proper, based