Public Act 096-1389
 
SB0580 EnrolledLRB096 06644 RLJ 16728 b



    AN ACT concerning local government.

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



 
    Section 5. The Water Commission Act of 1985 is amended  by 
changing Section 4 and  by adding Sections 0.001, 0.001a, and 
0.001b as follows:
 
    (70 ILCS 3720/0.001 new)
    Sec. 0.001. Commissioners; terms; vacancies. Effective 
January 1, 2011, the terms of office of the chairperson and all 
commissioners of water commissions appointed pursuant to this 
Act shall terminate and the commission shall be reconstituted.
    (a) The commissioners shall be appointed as follows: 
        (1) A chairperson, who shall also serve in the capacity 
    of a commissioner, shall be appointed by the chairperson of 
    the county board of the home county with the advice and 
    consent of the county board.
        (2) One commissioner from each county board district 
    within the home county shall be appointed by the 
    chairperson of the county board of the home county with the 
    advice and consent of the county board.
        (3) One commissioner from each county board district 
    within the home county shall be appointed by the majority 
    vote of the mayors of those included municipalities that 
    have the greatest percentage of their respective 
    populations residing within such county board district of 
    the home county. A vice-chairperson of the commission shall 
    be appointed from the commissioners appointed pursuant to 
    this paragraph by a majority vote of these commissioners.
    (b) All commissioners shall be residents of the home county 
or a resident of an included municipality.
    (c) The initial commissioners appointed pursuant to 
subsection (a) shall serve the following terms:
        (1) The chairperson shall serve for a term of 6 years.
        (2)     At the first meeting of the commission held after 
    January 1, 2011, the commissioners appointed pursuant to 
    paragraph (2) of subsection (a) shall determine publicly by 
    lot one-third of their members to serve for a term of 2 
    years, one-third of their members to serve for a term of 4 
    years, and one-third of their members to serve for a term 
    of 6 years, any odd number of commissioners so determined 
    by dividing into thirds to serve 6-year terms.
        (3)     At the first meeting of the commission held after 
    January 1, 2011, the commissioners and the 
    vice-chairperson appointed pursuant to paragraph (3) of 
    subsection (a) shall determine publicly by lot one-third of 
    their members to serve for a term of 2 years, one-third of 
    their members to serve for a term of 4 years, and one-third 
    of their members to serve for a term of 6 years, any odd 
    number of commissioners so determined by dividing into 
    thirds to serve 6-year terms.
    The successor commissioners shall serve for a term of 6 
years or until their successors have been appointed and 
qualified in the same manner as the original appointments. 
    (d) A commissioner shall be eligible for reappointment upon 
the expiration of his or her term.  A vacancy in the office of a 
commissioner shall be filled for the balance of the unexpired 
term by appointment and with the qualifications as to residency 
in the same manner as the original appointment was made.
    (e) A commissioner may be a member of the governing board, 
an officer, or an employee of the county or any unit of local 
government located within the county. 
 
    (70 ILCS 3720/0.001a new)
    Sec. 0.001a. Officers. A water commission established 
pursuant to this Act shall, by majority vote of the water 
commissioners, appoint a general manager, a finance director, 
and a treasurer.  The appointment of the general manager, 
finance director, and treasurer is subject to the advice and 
consent of the county board of the home county in which the 
county water commission is located. The positions of finance 
director and treasurer shall be filled by persons with the 
necessary financial background and experience to monitor and 
report on water commission financial matters and budgeting.
 
    (70 ILCS 3720/0.001b new)
    Sec. 0.001b. Powers and duties. A water commission has the 
power and duty to:
        (1) establish and define the responsibilities of the 
    commission and its committees;
        (2) establish and define the responsibilities of the 
    commission's management and staff;
        (3) establish a finance committee to conduct monthly 
    meetings to supervise staff's handling of financial 
    matters and budgeting;
        (4) require the finance director and treasurer to 
    report to the finance committee the status of all 
    commission funds and obligations;
        (5) require the treasurer to report to the commission 
    any improper or unnecessary expenditures, budgetary 
    errors, or accounting irregularities;
        (6) require commission staff to document and comply 
    with standard accounting policies, procedures, and 
    controls to ensure accurate reporting to the finance 
    committee and commission and to identify improper or 
    unnecessary expenditures, budgetary errors, or accounting 
    irregularities;
        (7) require the commission's finance director to 
    provide monthly reports regarding the commission's cash 
    and investment position including whether the commission 
    has sufficient cash and investments to pay its debt 
    service, operating expenses, and capital expenditures and 
    maintain required reserve levels.  The information shall 
    include the required funding levels for restricted funds 
    and unrestricted cash and investment balances with 
    comparisons to unrestricted reserves.  The information 
    shall also include the type and performance of the 
    commission's investments and description as to whether 
    those investments are in compliance with the commission's 
    investment policies;
        (8) require the commission's finance director to 
    provide the commission with detailed information 
    concerning the commission's operating performance 
    including the budgeted and actual monthly amounts for water 
    sales, water costs, and other operating expenses;
        (9) require commission staff to provide the commission 
    with detailed information regarding the progress of 
    capital projects including whether the percentage of 
    completion and costs incurred are timely;
        (10) require the commission's staff accountant to 
    perform bank reconciliations and general ledger account 
    reconciliations on a monthly basis;  the finance director 
    shall review these reconciliations and provide them to the 
    treasurer and the finance committee on a monthly basis;
        (l1) establish policies to ensure the proper 
    segregation of the financial duties performed by 
    employees;
        (12) restrict access to the established accounting 
    systems and general ledger systems and provide for adequate 
    segregation of duties so that no single person has sole 
    access and control over the accounting system or the 
    general ledger system;
        (13) require that the finance director review and 
    approve all manual journal entries and supporting 
    documentation;  the treasurer shall review and approve the 
    finance director's review and approval of manual journal 
    entries and supporting documentation;
        (14) require that the finance director closely monitor 
    the progress of construction projects;
        (15) require that the finance director carefully 
    document any GAAP analysis or communications with GASB and 
    provide full and timely reports for the same to the finance 
    committee; and
        (16) retain an outside independent auditor to perform a 
    comprehensive audit of the water commission's financial 
    activities for each fiscal year in conformance with the 
    standard practices of the Association of Governmental 
    Auditors; within 30 days after the independent audit is 
    completed, the results of the audit must be sent to the 
    county auditor.
 
    (70 ILCS 3720/4)  (from Ch. 111 2/3, par. 254)
    Sec. 4. Taxes. 
    (a) The board of commissioners of any county water 
commission
may, by ordinance, impose throughout the territory 
of the commission any or
all of the taxes provided in this 
Section for its corporate purposes.
However, no county water 
commission may impose any such tax unless the
commission 
certifies the proposition of imposing the tax to the proper

election officials, who shall submit the proposition to the 
voters residing
in the territory 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 in the form provided in Section 5 
or shall be
substantially in the following form:
-------------

    Shall the (insert corporate

name of county water commission)           YES

impose (state type of tax or         ------------------------

taxes to be imposed) at the                NO

rate of 1/4%?

-------------------------------------------------------------
    Taxes imposed under this Section and civil penalties 
imposed
incident thereto shall be collected and enforced by the 
State Department of
Revenue. The Department shall have the 
power to administer and enforce the
taxes and to determine all 
rights for refunds for erroneous payments of
the taxes.
    (b) The board of commissioners may impose a County Water 
Commission
Retailers' Occupation Tax upon all persons engaged 
in the business of
selling tangible personal property at retail 
in the territory of the
commission at a rate of 1/4% of the 
gross receipts from the sales made in
the course of such 
business within the territory.  The tax imposed under
this 
paragraph and all civil penalties that may be assessed as an 
incident
thereof shall be collected and enforced by the State 
Department of Revenue.
The Department shall have full power to 
administer and enforce this
paragraph; to collect all taxes and 
penalties due hereunder; to dispose of
taxes and penalties so 
collected in the manner hereinafter provided; and to
determine 
all rights to credit memoranda arising on account of the

erroneous payment of tax or penalty hereunder.  In the 
administration of,
and compliance with, this paragraph, the 
Department and persons who are
subject to this paragraph shall 
have the same rights, remedies, privileges,
immunities, powers 
and duties, and be subject to the same conditions,

restrictions, limitations, penalties, exclusions, exemptions 
and
definitions of terms, and employ the same modes of 
procedure, as are
prescribed in Sections 1, 1a, 1a-1, 1c, 1d, 
1e, 1f, 1i, 1j, 2 through 2-65
(in respect to all provisions 
therein other than the State rate of tax
except that food for 
human consumption that is to be consumed off the
premises where 
it is sold (other than alcoholic beverages, soft drinks, and

food that has been prepared for immediate consumption) and 
prescription
and nonprescription medicine, drugs, medical 
appliances and insulin, urine
testing materials, syringes, and 
needles used by diabetics, for human use,
shall not be subject 
to tax hereunder), 2c, 3 (except as to the disposition
of taxes 
and penalties collected), 4, 5, 5a, 5b, 5c, 5d, 5e, 5f, 5g, 5h,

5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 7, 8, 9, 10, 11, 12 and 13 of
the 
Retailers' Occupation Tax Act and Section 3-7 of the Uniform 
Penalty
and Interest Act, as fully as if those provisions were 
set forth herein.
    Persons subject to any tax imposed under the authority 
granted in this
paragraph may reimburse themselves for their 
seller's tax liability
hereunder by separately stating the tax 
as an additional charge, which
charge may be stated in 
combination, in a single amount, with State taxes
that sellers 
are required to collect under the Use Tax Act and under

subsection (e) of Section 4.03 of the Regional Transportation 
Authority
Act, in accordance with such bracket schedules as the 
Department may prescribe.
    Whenever the Department determines that a refund should be 
made under this
paragraph to a claimant instead of issuing a 
credit memorandum, the Department
shall notify the State 
Comptroller, who shall cause the warrant to be drawn
for the 
amount specified, and to the person named, in the notification

from the Department.  The refund shall be paid by the State 
Treasurer out
of a county water commission tax fund established 
under paragraph (g) of
this Section.
    For the purpose of determining whether a tax authorized 
under this paragraph
is applicable, a retail sale by a producer 
of coal or other mineral mined
in Illinois is a sale at retail 
at the place where the coal or other mineral
mined in Illinois 
is extracted from the earth.  This paragraph does not
apply to 
coal or other mineral when it is delivered or shipped by the 
seller
to the purchaser at a point outside Illinois so that the 
sale is exempt
under the Federal Constitution as a sale in 
interstate or foreign commerce.
    If a tax is imposed under this subsection (b) a tax shall 
also be
imposed under subsections (c) and (d) of this Section.
    No tax shall be imposed or collected under this subsection 
on the sale of a motor vehicle in this State to a resident of 
another state if that motor vehicle will not be titled in this 
State.

    Nothing in this paragraph shall be construed to authorize a 
county water
commission to impose a tax upon the privilege of 
engaging in any
business which under the Constitution of the 
United States may not be made
the subject of taxation by this 
State.
    (c) If a tax has been imposed under subsection (b), a

County Water Commission Service Occupation
Tax shall
also be 
imposed upon all persons engaged, in the territory of the

commission, in the business of making sales of service, who, as 
an
incident to making the sales of service, transfer tangible 
personal
property within the territory. The tax rate shall be 
1/4% of the selling
price of tangible personal property so 
transferred within the territory.
The tax imposed under this 
paragraph and all civil penalties that may be
assessed as an 
incident thereof shall be collected and enforced by the
State 
Department of Revenue. The Department shall have full power to

administer and enforce this paragraph; to collect all taxes and 
penalties
due hereunder; to dispose of taxes and penalties so 
collected in the manner
hereinafter provided; and to determine 
all rights to credit memoranda
arising on account of the 
erroneous payment of tax or penalty hereunder.
In the 
administration of, and compliance with, this paragraph, the

Department and persons who are subject to this paragraph shall 
have the
same rights, remedies, privileges, immunities, powers 
and duties, and be
subject to the same conditions, 
restrictions, limitations, penalties,
exclusions, exemptions 
and definitions of terms, and employ the same modes
of 
procedure, as are prescribed in Sections 1a-1, 2 (except that 
the
reference to State in the definition of supplier 
maintaining a place of
business in this State shall mean the 
territory of the commission), 2a, 3
through 3-50 (in respect to 
all provisions therein other than the State
rate of tax except 
that food for human consumption that is to be consumed
off the 
premises where it is sold (other than alcoholic beverages, soft

drinks, and food that has been prepared for immediate 
consumption) and
prescription and nonprescription medicines, 
drugs, medical appliances and
insulin, urine testing 
materials, syringes, and needles used by diabetics,
for human 
use, shall not be subject to tax hereunder), 4 (except that the

reference to the State shall be to the territory of the 
commission), 5, 7,
8 (except that the jurisdiction to which the 
tax shall be a debt to the
extent indicated in that Section 8 
shall be the commission), 9 (except as
to the disposition of 
taxes and penalties collected and except that the
returned 
merchandise credit for this tax may not be taken against any 
State
tax), 10, 11, 12 (except the reference therein to Section 
2b of the
Retailers' Occupation Tax Act), 13 (except that any 
reference to the State
shall mean the territory of the 
commission), the first paragraph of Section
15, 15.5, 16, 17, 
18, 19 and 20 of the Service Occupation Tax Act as fully
as if 
those provisions were set forth herein.
    Persons subject to any tax imposed under the authority 
granted in
this paragraph may reimburse themselves for their 
serviceman's tax liability
hereunder by separately stating the 
tax as an additional charge, which
charge may be stated in 
combination, in a single amount, with State tax
that servicemen 
are authorized to collect under the Service Use Tax Act,
and 
any tax for which servicemen may be liable under subsection (f) 
of
Sec. 4.03 of the Regional Transportation Authority Act, in 
accordance
with such bracket schedules as the Department may 
prescribe.
    Whenever the Department determines that a refund should be 
made under this
paragraph to a claimant instead of issuing a 
credit memorandum, the Department
shall notify the State 
Comptroller, who shall cause the warrant to be drawn
for the 
amount specified, and to the person named, in the notification 
from
the Department.  The refund shall be paid by the State 
Treasurer out of a
county water commission tax fund established 
under paragraph (g) of this
Section.
    Nothing in this paragraph shall be construed to authorize a 
county water
commission to impose a tax upon the privilege of 
engaging in any business
which under the Constitution of the 
United States may not be made the
subject of taxation by the 
State.
    (d) If a tax has been imposed under subsection (b), a tax 
shall
also imposed upon the privilege of using, in the 
territory of the
commission, any item of tangible personal 
property that is purchased
outside the territory at retail from 
a retailer, and that is titled or
registered with an agency of 
this State's government, at a rate of 1/4% of
the selling price 
of the tangible personal property within the territory,
as 
"selling price" is defined in the Use Tax Act. The tax shall be 
collected
from persons whose Illinois address for titling or 
registration purposes
is given as being in the territory.  The 
tax shall be collected by the
Department of Revenue for a 
county water commission.  The tax must be paid
to the State, or 
an exemption determination must be obtained from the
Department 
of Revenue, before the title or certificate of registration for

the property may be issued. The tax or proof of exemption may 
be
transmitted to the Department by way of the State agency 
with which, or the
State officer with whom, the tangible 
personal property must be titled or
registered if the 
Department and the State agency or State officer
determine that 
this procedure will expedite the processing of applications
for 
title or registration.
    The Department shall have full power to administer and 
enforce this
paragraph; to collect all taxes, penalties and 
interest due hereunder; to
dispose of taxes, penalties and 
interest so collected in the manner
hereinafter provided; and 
to determine all rights to credit memoranda or
refunds arising 
on account of the erroneous payment of tax, penalty or
interest 
hereunder. In the administration of, and compliance with this

paragraph, the Department and persons who are subject to this 
paragraph
shall have the same rights, remedies, privileges, 
immunities, powers and
duties, and be subject to the same 
conditions, restrictions, limitations,
penalties, exclusions, 
exemptions and definitions of terms and employ the
same modes 
of procedure, as are prescribed in Sections 2 (except the

definition of "retailer maintaining a place of business in this 
State"), 3
through 3-80 (except provisions pertaining to the 
State rate of tax,
and except provisions concerning collection 
or refunding of the tax by
retailers, and except that food for 
human consumption that is to be
consumed off the premises where 
it is sold (other than alcoholic beverages,
soft drinks, and 
food that has been prepared for immediate consumption)
and 
prescription and nonprescription medicines, drugs, medical 
appliances
and insulin, urine testing materials, syringes, and 
needles used by
diabetics, for human use, shall not be subject 
to tax hereunder), 4, 11,
12, 12a, 14, 15, 19 (except the 
portions pertaining to claims by retailers
and except the last 
paragraph concerning refunds), 20, 21 and 22 of the Use
Tax Act 
and Section 3-7 of the Uniform Penalty and Interest Act that 
are
not inconsistent with this paragraph, as fully as if those 
provisions were
set forth herein.
    Whenever the Department determines that a refund should be 
made under this
paragraph to a claimant instead of issuing a 
credit memorandum, the Department
shall notify the State 
Comptroller, who shall cause the order
to be drawn for the 
amount specified, and to the person named, in the
notification 
from the Department.  The refund shall be paid by the State

Treasurer out of a county water commission tax fund established

under paragraph (g) of this Section.
    (e) A certificate of registration issued by the State 
Department of
Revenue to a retailer under the Retailers' 
Occupation Tax Act or under the
Service Occupation Tax Act 
shall permit the registrant to engage in a
business that is 
taxed under the tax imposed under paragraphs (b), (c)
or (d) of 
this Section and no additional registration shall be required 
under
the tax.  A certificate issued under the Use Tax Act or 
the Service Use Tax
Act shall be applicable with regard to any 
tax imposed under paragraph (c)
of this Section.
    (f) Any ordinance imposing or discontinuing any tax under 
this Section
shall be adopted and a certified copy thereof 
filed with the Department on
or before June 1, whereupon the 
Department of Revenue shall proceed to
administer and enforce 
this Section on behalf of the county water
commission as of 
September 1 next following the adoption and filing.
Beginning 
January 1, 1992, an ordinance or resolution imposing or

discontinuing the tax hereunder shall be adopted and a 
certified copy
thereof filed with the Department on or before 
the first day of July,
whereupon the Department shall proceed 
to administer and enforce this
Section as of the first day of 
October next following such adoption and
filing.  Beginning 
January 1, 1993, an ordinance or resolution imposing or

discontinuing the tax hereunder shall be adopted and a 
certified copy
thereof filed with the Department on or before 
the first day of October,
whereupon the Department shall 
proceed to administer and enforce this
Section as of the first 
day of January next following such adoption and filing.
    (g) The State Department of Revenue shall, upon collecting 
any taxes as
provided in this Section, pay the taxes over to 
the State Treasurer as
trustee for the commission. The taxes 
shall be held in a trust fund outside
the State Treasury. On or 
before the 25th day of each calendar month, the
State 
Department of Revenue shall prepare and certify to the 
Comptroller of
the State of Illinois the amount to be paid to 
the commission, which shall be
the then balance in the fund, 
less any amount determined by the Department
to be necessary 
for the payment of refunds. Within 10 days after receipt by
the 
Comptroller of the certification of the amount to be paid to 
the
commission, the Comptroller shall cause an order to be 
drawn for the payment
for the amount in accordance with the 
direction in the certification.
    (h) Beginning June 1, 2016, any tax imposed pursuant to 
this Section may no longer be imposed or collected, unless a 
continuation of the tax is approved by the voters at a 
referendum as set forth in this Section.
(Source: P.A. 92-221, eff. 8-2-01; 93-1068, eff. 1-15-05.)
 

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