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91_HB2924eng HB2924 Engrossed LRB9108568DJcsC 1 AN ACT concerning proceeds from tobacco litigation. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Article 5. 5 Section 5-1. Short title. This Article may be cited as 6 the Health First Plan Law. In this Article, references to 7 "this Law" mean this Article. 8 Section 5-5. Definition. In this Act, "Master Settlement 9 Agreement" means the Master Settlement Agreement entered in 10 the case of the People of the State of Illinois v. Philip 11 Morris et al. (Circuit Court of Cook County, No. 96-L13146). 12 Section 5-10. Moneys set aside for investment. 13 (a) The General Assembly finds that it is important to 14 save a portion of the moneys paid to the State under the 15 Master Settlement Agreement to protect the State from 16 financial hardship in the future due to less favorable 17 economic conditions, to provide reserves that may be used to 18 supplement moneys distributed under Section 5-15 of this Law, 19 or to finance other programs and services that the General 20 Assembly may authorize as provided in subsection (g) of this 21 Section. 22 (b) In each of fiscal years 2000 and 2001, 50% of the 23 moneys received by the State under the Master Settlement 24 Agreement shall be set aside for investment to foster growth 25 of those moneys so as to generate additional revenue that 26 will sustain distributions into the special funds established 27 under Section 20 over a longer period of time. In subsequent 28 fiscal years, the 50% that is set aside for investment in 29 each of the first 2 fiscal years shall be decreased by 2 HB2924 Engrossed -2- LRB9108568DJcsC 1 percentage points per year for 25 years so that at the end of 2 that period all moneys received by the State under the Master 3 Settlement Agreement each fiscal year will be distributed 4 into the special funds. As provided in the Tobacco Settlement 5 Bonding Authority Law, the State Treasurer may sell to the 6 Tobacco Settlement Bonding Authority up to 20% of the moneys 7 received by the State under the Master Settlement Agreement. 8 The portion of those moneys sold to the Tobacco Settlement 9 Bonding Authority shall come from the moneys set aside for 10 investment under this subsection. 11 (c) The State Treasurer shall manage all moneys set 12 aside for investment under this Section. The Treasurer may 13 invest the moneys in the same manner, in the same types of 14 investments, and subject to the same limitations as provided 15 in the Illinois Pension Code for the investment of pension 16 funds other than those established under Article 3 or 4 of 17 that Code. 18 (d) The State Treasurer shall develop, publish, and 19 implement an investment policy covering the investment of the 20 moneys in the Tobacco Settlement Recovery Fund. The Treasurer 21 shall cause the policy to be published at least once each 22 year in at least one newspaper of general circulation in both 23 Springfield and Chicago. At least 30 calendar days before 24 implementing any change in the previously published 25 investment policy, the Treasurer shall cause the change to be 26 published in a newspaper of general circulation in both 27 Springfield and Chicago. In the case of a State Treasurer 28 taking office after the effective date of this Law, within 90 29 days after taking office, the Treasurer shall review and, if 30 necessary, update the investment policy then in effect. 31 (e) All earnings on moneys set aside for investment 32 under this Section, less expenses incurred by the Treasurer 33 in administering the Fund, shall be retained in the Tobacco 34 Settlement Recovery Fund. The earnings shall not be included HB2924 Engrossed -3- LRB9108568DJcsC 1 in any amounts automatically distributed into the special 2 funds each fiscal year under Section 5-15 but shall be 3 allocated only in accordance with substantive legislation 4 enacted by the General Assembly from time to time as 5 circumstances and the State's needs dictate. 6 (f) The total expenses incurred by the State Treasurer 7 in administering the Tobacco Settlement Recovery Fund may not 8 exceed $200,000 before January 1, 2002. In 2002 and in each 9 year thereafter, the limit on the Treasurer's expenses 10 incurred in administering the Fund shall be adjusted based on 11 the Consumer Price Index for the North Central Region as 12 published by the United States Department of Labor, Bureau of 13 Labor Statistics, for the immediately preceding calendar 14 year. 15 (g) Except as provided in subsection (f) of Section 5-30 16 and except as otherwise provided by law, moneys appropriated 17 from the Tobacco Settlement Recovery Fund must be used for 18 purposes for which moneys appropriated from the special funds 19 established under Section 5-15 may be used. Moneys in the 20 Tobacco Settlement Recovery Fund may be appropriated for a 21 purpose other than a purpose for which moneys appropriated 22 from the special funds established under Section 5-15 may be 23 used, but any such appropriation for another purpose must be 24 approved by a three-fifths majority of each house. Each 25 appropriation of moneys from the Fund for a separate purpose 26 must be made in a separate bill. 27 Section 5-15. Moneys distributed into special funds. 28 (a) The following are created as special funds in the 29 State treasury: 30 (1) The Smoking/Tobacco Control Trust Fund. 31 (2) The Healthy Communities Trust Fund. 32 (3) The Seniors/Disabled Choices Trust Fund. 33 (4) The Healthy Schools Trust Fund. HB2924 Engrossed -4- LRB9108568DJcsC 1 (5) The Health and Medicine Endowment Fund. 2 (6) The Health Infrastructure Fund. 3 (b) In each of fiscal years 2000 and 2001, 50% of the 4 moneys received by the State under the Master Settlement 5 Agreement shall be distributed, immediately upon receipt, 6 into the special funds established under subsection (a). In 7 subsequent fiscal years, the 50% that is distributed into the 8 special funds in each of the first 2 fiscal years shall be 9 increased by 2 percentage points per year for 25 years so 10 that at the end of that period all moneys received by the 11 State under the Master Settlement Agreement each fiscal year 12 will be distributed into the special funds. For purposes of 13 this Section, the moneys to be distributed into the special 14 funds in any fiscal year are the "moneys for distribution". 15 (c) In each fiscal year, the moneys for distribution 16 shall be distributed into the special funds established under 17 subsection (a) as follows: 18 (1) Thirty percent of the moneys for distribution 19 shall be distributed into the Smoking/Tobacco Control 20 Trust Fund for community-based programs and services 21 administered by local nonprofit agencies, public 22 universities, and local health departments to control 23 tobacco use and distribution, to conduct smoking 24 cessation programs, and to provide addiction treatment, 25 according to budget guidelines issued by the U.S. Centers 26 for Disease Control. 27 (2) Twenty percent of the moneys for distribution 28 shall be distributed into the Healthy Communities Trust 29 Fund for expansion of community and family health 30 programs administered by various State agencies and 31 community-based organizations, including, but not limited 32 to: maternal and child health programs, including 33 services targeted to at-risk pregnant women and newborns 34 and infants; early childhood programs; adolescent HB2924 Engrossed -5- LRB9108568DJcsC 1 development programs; expanded coverage of children and 2 families under the Children's Health Insurance Program 3 Act; financial aid for urban and rural programs targeted 4 to designated shortage areas, as defined in the Illinois 5 Rural/Downstate Health Act; health programs targeted at 6 minorities; and HIV/AIDS control and prevention programs. 7 (3) Twenty percent of the moneys for distribution 8 shall be distributed into the Seniors/Disabled Choices 9 Trust Fund for home and community-based long-term care 10 services authorized under the Illinois Act on the Aging, 11 the Disabled Persons Rehabilitation Act, and the 12 Developmental Disability and Mental Disability Services 13 Act and for financial assistance provided to the elderly 14 or disabled including, but not limited to, expansion of 15 eligibility and coverage under the Senior Citizens and 16 Disabled Persons Property Tax Relief and Pharmaceutical 17 Assistance Act. 18 (4) Ten percent of the moneys for distribution shall 19 be distributed into the Healthy Schools Trust Fund for 20 primary and preventive health and mental health programs 21 and services for pre-school and school-age children 22 coordinated by the State Board of Education, including, 23 but not limited to, a program of smoking prevention and 24 cessation that either employs certificated school nurses 25 or employs registered professional nurses enrolled in an 26 Illinois certificated school nurse program. 27 (5) Ten percent of the moneys for distribution shall 28 be distributed into the Health and Medicine Endowment 29 Fund for allocation to at least 7 universities located in 30 Illinois to fund research on tobacco-related illnesses 31 such as cancer, cardiovascular disease, and pulmonary 32 disease and to enhance programs administered by schools 33 of public health in relation to tobacco addiction control 34 and treatment, smoking prevention, and smoking cessation. HB2924 Engrossed -6- LRB9108568DJcsC 1 A portion of the moneys distributed into this Fund shall 2 also be used for graduate medical education and for 3 programs for students pursuing careers in primary care 4 family medicine and adolescent medicine in underserved 5 communities. 6 (6) Ten percent of the moneys for distribution shall 7 be distributed into the Health Infrastructure Fund for 8 health-related capital financing for the purpose of 9 establishment, construction, or modification of essential 10 health facilities and services and also including the 11 acquisition, replacement, or upgrading of medical 12 equipment or vehicles. This financing may include the 13 distribution of funds for health-related capital 14 financing in the form of direct grants, security to 15 underwrite capital development bonds, or security to 16 underwrite loan pools for small businesses. 17 (d) Moneys in each of the special funds established 18 under subsection (a) shall be spent only according to 19 appropriations to the Health First Plan Authority made by the 20 General Assembly. The Authority shall use moneys 21 appropriated from the Smoking/Tobacco Control Trust Fund, the 22 Healthy Communities Trust Fund, the Senior/Disabled Choices 23 Trust Fund, the Healthy Schools Trust Fund, and the Health 24 Infrastructure Fund to award grants and contracts for 25 programs and services according to its policies, standards, 26 and procedures established under Section 5-30. The Authority 27 shall use moneys appropriated from the Health and Medicine 28 Endowment Fund to award research grants and contracts to 29 universities located in Illinois, also according to those 30 policies, standards, and procedures. 31 (e) Moneys unspent and remaining in a special fund at 32 the end of a fiscal year shall be carried over for 33 reappropriation and expenditure in subsequent fiscal years. HB2924 Engrossed -7- LRB9108568DJcsC 1 Section 5-20. Review of distributions. The General 2 Assembly may from time to time examine the amounts 3 distributed into the special funds established under Section 4 5-15 and allocated to programs, services, and universities 5 and may alter the schedule of decreases in the percentage of 6 moneys set aside for investment and the corresponding 7 schedule of increases in the percentage of moneys distributed 8 into the special funds, as circumstances and the State's 9 needs dictate. 10 Section 5-25. Treasurer's certification of amounts. Each 11 year, based on the amount paid to the State in that year 12 pursuant to the Master Settlement Agreement, the State 13 Treasurer shall certify to the General Assembly the portion 14 of that amount to be set aside for investment under Section 15 5-10 and the portion of that amount to be distributed into 16 each of the special funds established under Section 5-15. 17 Section 5-30. Health First Plan Authority. 18 (a) The Health First Plan Authority is created. The 19 Health First Plan Authority shall be composed of 5 members 20 appointed by the Governor with the advice and consent of the 21 Senate. The Governor shall appoint the members within 3 22 months after the effective date of this Law. The Governor 23 shall initially appoint 2 members for terms of 2 years and 3 24 members for terms of 4 years. Thereafter, the Governor shall 25 appoint all members for terms of 4 years. If a vacancy 26 occurs in the office of a member, the Governor shall appoint 27 a person to fill the remainder of the unexpired term. The 28 Governor's appointments must reflect a political balance. 29 (b) A member may not have a financial interest in an 30 entity that receives or may receive moneys allocated from one 31 of the special funds established under Section 5-15, nor may 32 a member have a financial interest in any other entity that HB2924 Engrossed -8- LRB9108568DJcsC 1 benefits or may benefit from the allocation of those moneys. 2 (c) Members of the Health First Plan Authority may be 3 reimbursed for their reasonable expenses actually incurred in 4 performing their duties. 5 (d) The Health First Plan Authority shall establish 6 policies, standards, and procedures to govern the allocation 7 of moneys appropriated from the special funds established 8 under Section 5-15. Those policies, standards, and 9 procedures shall (i) require that priority in awarding grants 10 or contracts must go to applicants who propose to use the 11 grant or contract moneys in connection with programs or 12 services to address treatment of tobacco-related illnesses or 13 tobacco-use prevention or cessation and (ii) include 14 provisions for evaluating applicants for grants or contracts 15 funded with those moneys. The Health First Plan Authority 16 also shall establish clear performance and evaluation 17 standards, including, but not limited to, collection of 18 demographic data such as age, gender, race, ethnicity, and 19 geographic information, to be applied to recipients of those 20 moneys to measure the results of the allocations from the 21 special funds and to determine future funding of programs and 22 services from those funds. The Health First Plan Authority 23 must evaluate the performance of every applicant for and 24 recipient of moneys appropriated from one of the special 25 funds and must conduct the evaluation before awarding, 26 continuing, or renewing a grant or contract. 27 (e) The Health First Plan Authority shall employ an 28 executive director and other staff necessary for processing 29 and overseeing grants and contracts funded with moneys 30 appropriated from the special funds established under Section 31 5-15. 32 (f) The General Assembly shall appropriate moneys for 33 the Health First Plan Authority's operation from the moneys 34 in the Tobacco Settlement Recovery Fund that are set aside HB2924 Engrossed -9- LRB9108568DJcsC 1 for investment under Section 5-10 or from the earnings on 2 those moneys. 3 Section 5-35. Comptroller's annual report. The State 4 Comptroller shall include, in the annual report required 5 under Section 20 of the State Comptroller Act, an accounting 6 of all amounts spent from each of the special funds 7 established under Section 5-15. 8 Section 5-40. Audit of special funds. At least once 9 during every biennium, as provided in Section 3-2 of the 10 Illinois State Auditing Act, the Auditor General shall 11 conduct a financial audit of all expenditures from the 12 special funds established under Section 5-15. 13 Section 5-45. Legislative Research Unit responsibilities. 14 As provided in Section 10-2 of the Legislative Commission 15 Reorganization Act of 1984, the Legislative Research Unit 16 shall evaluate the annual allocations and expenditures of 17 moneys from the special funds established under Section 5-15 18 and shall conduct program evaluations to determine the impact 19 of the system for distributing moneys paid to the State under 20 the Master Settlement Agreement. 21 Article 10. 22 Section 10-1. Short title. This Article may be cited as 23 the Tobacco Settlement Bonding Authority Law. In this 24 Article, references to "this Law" mean this Article. 25 Section 10-5. Definitions. In this Law: 26 "Bonding Authority" means the Tobacco Settlement Bonding 27 Authority created under Section 10-10. 28 "Board" means the Board of Directors of the Tobacco HB2924 Engrossed -10- LRB9108568DJcsC 1 Settlement Bonding Authority. 2 "Bond" means a bond or note or any other evidence of 3 obligation for borrowed money deemed appropriate by the Board 4 of Directors of the Tobacco Settlement Bonding Authority. 5 "Public member" means a person who is not, and is not 6 related to anyone who is, an elected official, employee, 7 consultant, agent, attorney, or accountant of the State of 8 Illinois or any political subdivision of the State of 9 Illinois. 10 "Master Settlement Agreement" means the Master Settlement 11 Agreement entered in the case of the People of the State of 12 Illinois v. Phillip Morris, et al. (Circuit Court of Cook 13 County, No. 96-L13146). 14 Section 10-10. Creation. There is created the Tobacco 15 Settlement Bonding Authority, which shall constitute a 16 political subdivision, a body politic and corporate, and a 17 municipal corporation of the State of Illinois. The State 18 Treasurer may sell to the Bonding Authority up to 20% of all 19 payments received from the Master Settlement Agreement. The 20 Bonding Authority shall pay its administrative expenses and 21 debt service expenses from the payments that it purchases 22 from the Master Settlement Agreement, provided that its 23 administrative expenses are approved by the Board of 24 Directors and do not exceed 0.5% of the payments transferred 25 to the Bonding Authority. The Bonding Authority shall, by 26 April 14 of each year, after payment of debt service, other 27 obligations, and administrative expenses, remit to the State 28 Treasurer for deposit into the Tobacco Settlement Recovery 29 Fund the remainder of the proceeds of the Master Settlement 30 Agreement that it has received, including investment earnings 31 and any bond proceeds including earnings on the investment of 32 the bond proceeds prior to remittance to the Treasurer. The 33 State Treasurer shall invest any moneys of the Bonding HB2924 Engrossed -11- LRB9108568DJcsC 1 Authority, on behalf of the Bonding Authority, in any 2 investment permitted by the Public Funds Investment Act or 3 any guaranteed investment contract the provider of which has 4 long-term debt rated in one of the three highest rating 5 categories (without regard to any rating refinement or 6 gradation by numerical or other modifiers) by 2 standard 7 rating services. 8 Section 10-15. Board of Directors. The State Treasurer, 9 or his or her designee, shall serve as the Chairman of the 10 Board. The Governor shall appoint 2 public members of the 11 Board and the Attorney General shall appoint one public 12 member of the Board, with the advice and consent of the 13 Senate, each for an initial term expiring July 1, 2003. The 14 State Treasurer, the Governor, and the Comptroller shall each 15 appoint one public member to the Board, with the advice and 16 consent of the Senate, for an initial term expiring July 1, 17 2002. The Attorney General and the Comptroller shall each 18 appoint one public member to the Board, with the advice and 19 consent of the Senate, for an initial term expiring July 1, 20 2001. At the expiration of the term of any member, or in the 21 case of a vacancy, a successor shall be appointed by the 22 elected official, or the successor of the elected official, 23 who made the appointment for the initial term. All 24 successors of Board members shall hold office for a term of 3 25 years from the first day of July of the year in which they 26 are appointed, except in case of an appointment to fill a 27 vacancy. Vacancies for members shall be filled in the same 28 manner as original appointments for the balance of the 29 unexpired term. In case of a vacancy during the recess of 30 the Senate, the Governor, the Attorney General, the 31 Comptroller, or the State Treasurer shall make a temporary 32 appointment until the next meeting of the Senate, when he or 33 she shall appoint some person to fill the vacancy. Any HB2924 Engrossed -12- LRB9108568DJcsC 1 person so appointed whom the Senate confirms shall hold 2 office during the remainder of the term and until his 3 successor is appointed and qualified. The initial 4 appointments by the Governor, the Attorney General, the 5 Comptroller, or the State Treasurer shall be effective 6 immediately. Nothing shall preclude a member from serving 7 consecutive terms. All members of the Board shall hold their 8 offices until their successors are appointed. 9 Section 10-20. Reimbursement of expenses. Reimbursement 10 of expenses of members and employees of the Bonding Authority 11 shall not exceed the rates of reimbursement established by 12 the Governor's Travel Control Board for employees of the 13 State of Illinois. 14 Section 10-25. Actions of members. Four members of the 15 Bonding Authority shall constitute a quorum for the purpose 16 of conducting business. Actions of the Bonding Authority 17 must receive the affirmative vote of at least 4 members. The 18 Bonding Authority shall determine the times and places of its 19 meetings. The members of the Bonding Authority shall serve 20 without compensation for service as a member but are entitled 21 to reimbursement of reasonable expenses incurred in the 22 performance of their official duties. 23 Section 10-30. Officers. 24 (a) The Bonding Authority shall appoint an Executive 25 Director, who shall be chief executive officer of the Bonding 26 Authority. In addition to any other duties set forth in this 27 Law, the Executive Director shall: 28 (1) Direct and supervise the administrative affairs 29 and activities of the Bonding Authority, in accordance 30 with its rules, regulations, and policies. 31 (2) Attend meetings of the Bonding Authority. HB2924 Engrossed -13- LRB9108568DJcsC 1 (3) Keep minutes of all proceedings of the Bonding 2 Authority. 3 (4) Approve all accounts for salaries and all other 4 allowable expenses of the Bonding Authority and its 5 employees and consultants and approve all expenses 6 incidental to the operation of the Bonding Authority. 7 (5) Perform any other duty that the Bonding 8 Authority requires for carrying out the provisions of 9 this Law. 10 (b) The Bonding Authority may appoint other officers of 11 the Bonding Authority who may or may not be members of the 12 Board. 13 Section 10-35. Powers. In addition to the powers set 14 forth elsewhere in this Law, the Bonding Authority may: 15 (1) Adopt and alter an official seal. 16 (2) Sue and be sued and plead and be impleaded, all 17 in its own name, and agree to binding arbitration of any 18 dispute to which it is a party. 19 (3) Adopt bylaws, rules, and regulations to carry 20 out the provisions of this Law. 21 (4) Maintain an office or offices at such place as 22 the Bonding Authority may designate. 23 (5) Employ, either as regular employees or 24 independent contractors, consultants, accountants, 25 attorneys, financial experts, managers and other 26 professional personnel, and such other personnel as may 27 be necessary in the judgment of the Bonding Authority, 28 and fix their compensation. 29 (6) Enter into contracts and agreements of any kind. 30 (7) Issue bonds under Section 10-40. 31 (8) Exercise all the corporate powers granted 32 Illinois corporations under the Business Corporation Act 33 of 1983, except to the extent that powers are HB2924 Engrossed -14- LRB9108568DJcsC 1 inconsistent with those of a body politic and corporate 2 of the State. 3 (9) Do all things necessary or convenient to carry 4 out the powers granted by this Law. 5 Section 10-40. Bonding. 6 (a) The Bonding Authority shall issue bonds which are 7 revenue bonds that are payable solely from and secured solely 8 by the proceeds of the Master Settlement Agreement that have 9 been sold by the State of Illinois to the Bonding Authority 10 from the Master Settlement Agreement. The Bonding Authority 11 may issue bonds for the purpose of purchasing an interest of 12 the State of Illinois in the Master Settlement Agreement, for 13 the purpose of refunding, advance refunding, or refinancing 14 outstanding bonds, for the purpose of establishing reserves, 15 paying the interest on the bonds, and paying costs of 16 issuance of the bonds, and for any other proper public 17 purpose. Bonds may be issued in one or more series and shall 18 be payable solely and secured solely by the portion of the 19 Master Settlement Agreement that the State of Illinois has 20 sold to the Bonding Authority. 21 (b) Bonds may be authorized by a resolution of the Board 22 and may be secured by a trust agreement by and between the 23 Bonding Authority and a corporate trustee or trustees, which 24 may be any trust company or bank having the powers of a trust 25 company within or without the State. Bonds may: 26 (1) Mature at any time or times not exceeding 20 27 years from the effective date of this Law. 28 (2) Notwithstanding the provisions of the Bond 29 Authorization Act or any other provision of law, bear 30 interest at any fixed or variable rate or rates 31 determined by the method provided in the resolution or 32 trust agreement. 33 (3) Be payable as to principal and interest at any HB2924 Engrossed -15- LRB9108568DJcsC 1 time or times, in the denominations and form, either 2 coupon or registered or both, and carry the registration 3 and privileges as to exchange, transfer, or conversion 4 and for the replacement of mutilated, lost, or destroyed 5 bonds as the resolution or trust agreement may provide. 6 (4) Be payable in lawful money of the United States 7 at a designated place. 8 (5) Be subject to the terms of purchase, payment, 9 redemption, refunding, or refinancing that the resolution 10 or trust agreement provides. 11 (6) Be executed by the manual or facsimile 12 signatures of the officers of the Bonding Authority 13 designated by the Bonding Authority, which signatures 14 shall be valid at delivery even for one who has ceased to 15 hold office. 16 (7) Be sold at public or private sale in the manner 17 and upon the terms determined by the Bonding Authority. 18 (8) Have such other terms and provisions as shall 19 be authorized by resolution of the Board. 20 (c) Any resolution or trust agreement may contain 21 provisions that shall be a part of the contract with the 22 holders of the bonds as to: 23 (1) Limitations on the issue of additional bonds, 24 the terms upon which additional bonds may be issued and 25 secured, and the terms upon which additional bonds may 26 rank on a parity with, or be subordinate or superior to, 27 other bonds. 28 (2) The refunding, advance refunding or refinancing 29 of outstanding bonds. 30 (3) The procedure, if any, by which the terms of any 31 contract with holders of the bonds may be altered or 32 amended, the number of bond holders that must consent 33 thereto, and the manner in which consent shall be given. 34 (4) Defining the acts or omissions which shall HB2924 Engrossed -16- LRB9108568DJcsC 1 constitute a default in the duties of the Bonding 2 Authority to the holders of bonds and providing the 3 rights or remedies of such holders in the event of a 4 default which may include provisions restricting 5 individual right of action by the holders of the bonds. 6 (5) Any other matter relating to the bonds which the 7 Bonding Authority determines appropriate. 8 (d) In connection with the issuance of its bonds, the 9 Bonding Authority may enter into arrangements to provide 10 additional security and liquidity for the bonds. These may 11 include, without limitation, bond insurance, letters of 12 credit, lines of credit by which the Bonding Authority may 13 borrow funds to pay or redeem its bonds, and purchase or 14 remarketing arrangements for assuring the ability of holders 15 of the Bonding Authority's bonds to sell or to have redeemed 16 their bonds. 17 (e) A pledge by the Bonding Authority of the proceeds of 18 the Master Settlement Agreement that the State of Illinois 19 has sold to transfer to the Bonding Authority as security for 20 an issue of bonds or for the performance of its obligations 21 under any management agreement shall be valid and binding 22 from the time when the pledge is made. The portion of the 23 Master Settlement Agreement proceeds that the State of 24 Illinois has committed to transfer to the Bonding Authority 25 pledged shall immediately be subject to the lien of the 26 pledge without any physical delivery or further act, and the 27 lien of any pledge shall be valid and binding against any 28 person having any claim of any kind in tort, contract, or 29 otherwise against the Bonding Authority, irrespective of 30 whether the person has notice. No resolution, trust 31 agreement, management agreement or financing statement, 32 continuation statement, or other instrument adopted or 33 entered into by the Bonding Authority need be filed or 34 recorded in any public record other than the records of the HB2924 Engrossed -17- LRB9108568DJcsC 1 Bonding Authority in order to perfect the lien against third 2 persons, regardless of any contrary provision of law. 3 (f) The Bonding Authority may issue bonds to refund, 4 advance refund, or refinance any of its bonds then 5 outstanding, including the payment of any redemption premium 6 and any interest accrued or to accrue to the earliest or any 7 subsequent date of redemption, purchase, or maturity of the 8 bonds, provided that the Bonding Authority shall not issue 9 any bonds that mature later than 20 years from the effective 10 date of this Law. 11 (g) At no time shall the total outstanding bonds of the 12 Bonding Authority issued under this Section exceed 13 $500,000,000. Bonds which have been paid, bonds which are 14 being paid or retired by issuance, sale or delivery of bonds, 15 and bonds for which sufficient funds have been deposited with 16 the paying agent or trustee to provide for payment of 17 principal and interest thereon, and any redemption premium, 18 as provided in the authorizing resolution or indenture, shall 19 not be considered outstanding for the purposes of this 20 subsection. 21 (h) The bonds of the Bonding Authority shall not 22 constitute an indebtedness of the State or of any political 23 subdivision of the State. The bonds of the Bonding Authority 24 shall not be an obligation, general or moral, of the State of 25 Illinois and shall not be an obligation, general or moral, 26 secured by a pledge of the full faith and credit of the State 27 of Illinois, and the holders of bonds of the Bonding 28 Authority may not require the levy or imposition by the State 29 of any taxes or the application of other State revenues or 30 funds to the payment of the bonds of the Bonding Authority. 31 No member of the Bonding Authority or any person executing 32 the bonds shall be liable personally on the bonds or subject 33 to any personal liability by reason of the issuance of the 34 bonds. The foregoing shall be stated on the face of each HB2924 Engrossed -18- LRB9108568DJcsC 1 bond. 2 (i) The State of Illinois pledges to and agrees with the 3 holders of the bonds of the Bonding Authority issued pursuant 4 to this Law that the State will not limit or alter the rights 5 and powers vested in the Bonding Authority by this Law so as 6 to impair the terms of any contract made by the Bonding 7 Authority with those holders or in any way impair the rights 8 and remedies of those holders until the bonds, together with 9 interest thereon, with interest on any unpaid installments of 10 interest, and all costs and expenses in connection with any 11 action or proceedings by or on behalf of those holders, are 12 fully met and discharged. In addition, the State pledges to 13 and agrees with the holders of the bonds of the Bonding 14 Authority issued pursuant to this Law that the State will not 15 limit or alter the basis on which the proceeds of the Master 16 Settlement Agreement that the State of Illinois has sold to 17 the Bonding Authority are to be allocated, deposited, and 18 paid to the Authority as provided in this Law, or the use of 19 those funds, so as to impair the terms of any such contract. 20 The Bonding Authority is authorized to include these pledges 21 and agreements of the State in any contract with the holders 22 of bonds issued pursuant to this Section. 23 (j) The Bonding Authority may enter into agreements or 24 contracts with any person necessary or appropriate to place 25 the payment obligations of the Bonding Authority under any of 26 its bonds in whole or in part on any interest rate basis, 27 cash flow basis, or other basis desired by the Bonding 28 Authority, including without limitation agreements or 29 contracts commonly known as "interest rate swap agreements", 30 "forward payment conversion agreements", and "futures", or 31 agreements or contracts providing for payments based on 32 levels of or changes in interest rates, or agreements or 33 contracts to exchange cash flows or a series of payments, or 34 agreements or contracts, including without limitation HB2924 Engrossed -19- LRB9108568DJcsC 1 agreements or contracts commonly known as "options", "puts", 2 or "calls", to hedge payment, rate spread, or similar 3 exposure; provided, that any such agreement or contract shall 4 not constitute an obligation for borrowed money and shall not 5 be taken into account under this Law or any other debt limit 6 of the Bonding Authority or the State of Illinois. 7 Section 10-45. Records and reporting. The Executive 8 Director shall keep a record of the proceedings of the 9 Bonding Authority. The State Treasurer shall be custodian of 10 all Bonding Authority funds and shall be bonded in the amount 11 the other members of the Bonding Authority may designate. 12 The accounts and books of the Bonding Authority shall be set 13 up and maintained in a manner approved by the Auditor 14 General, and the Bonding Authority shall file with the 15 Auditor General a certified annual report within 120 days 16 after the close of its fiscal year. The Bonding Authority 17 shall also file with the Governor, the Secretary of the 18 Senate, the Clerk of the House of Representatives, and the 19 Illinois Economic and Fiscal Commission, by March 1 of each 20 year, a written report covering its activities for the 21 previous fiscal year. After being so filed, the report shall 22 be a public record and open for inspection at the offices of 23 the Bonding Authority during normal business hours. 24 Section 10-50. Conflicts of interest. No member of the 25 Board may participate in any decision on any contract entered 26 into by the Bonding Authority if the member has a 7.5% or 27 greater pecuniary interest, direct or indirect, in any firm, 28 partnership, corporation, or association which is or may be a 29 party to the contract. Contracts or agreements obtained 30 through properly advertised bid procedures, or the ownership 31 of stock or other interest in any firm, partnership, 32 corporation, or association in which the member does not HB2924 Engrossed -20- LRB9108568DJcsC 1 actively participate in day-to-day management, shall not be 2 interpreted as a direct or indirect pecuniary interest in 3 violation of this Law. Notwithstanding any other provision of 4 law, any contract or agreement entered into in conformity 5 with this subsection shall not be void or invalid by reason 6 of any such interest, nor shall any person so refraining from 7 participation be guilty of any offense, be removed from 8 office, or be subject to any other penalty on account of that 9 interest. 10 Section 10-55. Dissolution. The Tobacco Settlement 11 Bonding Authority shall be dissolved 20 years after the 12 effective date of this Law. The Bonding Authority shall not 13 be dissolved or liquidated by virtue of any proceedings 14 under, and shall not be subject to, any bankruptcy, 15 insolvency, or similar federal or State laws. 16 Section 10-60. Property exempt from execution. All 17 property of the Bonding Authority is exempt from levy and 18 sale by virtue of an execution. No execution or other 19 judicial process may issue against the Bonding Authority's 20 property, nor may any judgment against the Bonding Authority 21 be a charge or lien upon its property. However, nothing in 22 this Law shall apply to or limit the rights of the holder of 23 any bonds to pursue any remedy for the enforcement of any 24 pledge or lien given by the Bonding Authority on its revenues 25 or other money. 26 Section 10-65. Limitation. Any action or proceeding in 27 any court to set aside a resolution authorizing the Bonding 28 Authority's issuance of bonds under this Law or to obtain any 29 relief upon the ground that the resolution is invalid must be 30 commenced within 30 days after the Board adopts the 31 resolution. After this period of limitation expires, no right HB2924 Engrossed -21- LRB9108568DJcsC 1 of action or defense founded upon the invalidity of the 2 resolution or any of its provisions may be asserted, nor may 3 the validity of the resolution or any of its provisions be 4 open to question in any court on any ground. 5 Section 10-70. Bonds as legal investments and security. 6 Notwithstanding any restrictions contained in any other law, 7 the State and all public officers, governmental units and 8 agencies of the State, all national banking associations, 9 state banks, trust companies, savings banks and institutions, 10 building and loan associations, savings and loan 11 associations, investment companies and other persons carrying 12 on a banking business, all insurance companies, insurance 13 associations and other persons carrying on an insurance 14 business, and all executors, administrators, guardians, 15 trustees and other fiduciaries, may legally invest any 16 sinking funds, money or other funds belonging to them or 17 within their control in any bonds issued by the Bonding 18 Authority under this Law. These bonds are authorized 19 security for any and all public deposits. 20 Section 10-75. Tax exemptions. All property of the 21 Bonding Authority and all bonds issued under this Law are 22 deemed to constitute essential public and governmental 23 purposes and the property and the bonds so issued, their 24 transfer and the income from those bonds are at all times 25 exempt from taxation within this State. For purposes of 26 Section 250 of the Illinois Income Tax Act, the exemption of 27 the income from bonds issued under this Act shall terminate 28 after all of the bonds have been paid. The amount of such 29 income that shall be added and then subtracted on the 30 Illinois income tax return of a taxpayer, pursuant to Section 31 203 of the Illinois Income Tax Act, from federal adjusted 32 gross income or federal taxable income in computing Illinois HB2924 Engrossed -22- LRB9108568DJcsC 1 base income shall be the interest net of any bond premium 2 amortization. 3 Section 10-80. Personal liability. Neither the members 4 of the Board nor any person executing bonds issued under this 5 Law shall be liable personally on those bonds by reason of 6 the issuance of the bonds. 7 Section 10-85. Complete, additional, and alternative 8 methods. The foregoing Sections of this Law are deemed to 9 provide a complete, additional, and alternative method for 10 the doing of the things authorized thereby and shall be 11 regarded as supplemental and additional to powers conferred 12 by other laws, provided that the issuance of bonds under this 13 Law need not comply with the requirements of any other law 14 applicable to the issuance of bonds. Except as otherwise 15 expressly provided in this Law, none of the powers granted to 16 the Bonding Authority under this Law shall be subject to the 17 supervision or regulation or require the approval or consent 18 of any municipality or political subdivision or any 19 department, division, commission, board, body, bureau, 20 official, or agency thereof or of the State. 21 Section 10-90. Liberal construction of Law. This Law, 22 being necessary for the welfare of the State and its 23 inhabitants, shall be liberally construed to effect its 24 purposes. 25 Section 10-95. Severability. If any clause or other 26 portion of this Law is held invalid, that decision shall not 27 affect the validity of the remaining portions of this Law. 28 It is hereby declared that all such remaining portions of 29 this Law are severable, and that the General Assembly would 30 have enacted the remaining portions if the portions that may HB2924 Engrossed -23- LRB9108568DJcsC 1 be so held to be invalid had not been included in this Law. 2 Article 90. 3 Section 90-5. The State Comptroller Act is amended by 4 changing Section 20 as follows: 5 (15 ILCS 405/20) (from Ch. 15, par. 220) 6 Sec. 20. Annual report. The comptroller shall annually, 7 as soon as possible after the close of the fiscal year but no 8 later than December 31, make out and present to the Governor, 9 the President of the Senate, the Speaker of the House of 10 Representatives, the Minority Leader of the Senate, and the 11 Minority Leader of the House of Representatives a report, 12 showing the amount of warrants drawn on the treasury, on 13 other funds held by the State Treasurer and on any public 14 funds held by State agencies, during the preceding fiscal 15 year, and stating, particularly, on what account they were 16 drawn, and if drawn on the contingent fund, to whom and for 17 what they were issued. The comptroller shall include in the 18 annual report an accounting of all amounts spent from each 19 of the special funds established under Section 5-15 of the 20 Health First Plan Law. He shall, also, at the same time, 21 report to the Governor, the President of the Senate, the 22 Speaker of the House of Representatives, the Minority Leader 23 of the Senate, and the Minority Leader of the House of 24 Representatives the amount of money received into the 25 treasury, into other funds held by the State Treasurer and 26 into any other funds held by State agencies during the 27 preceding fiscal year, and stating particularly, the source 28 from which the same may be derived, and also a general 29 account of all the business of his office during the 30 preceding fiscal year. The report shall also summarize for 31 the previous fiscal year the information required under HB2924 Engrossed -24- LRB9108568DJcsC 1 Section 19. 2 Within 60 days after the expiration of each calendar 3 year, the comptroller shall compile, from records maintained 4 and available in his office, a list of all persons including 5 those employed in the office of the comptroller, who have 6 been employed by the State during the past calendar year and 7 paid from funds in the hands of the State Treasurer. 8 The list shall be arranged according to counties and 9 shall state in alphabetical order the name of each employee, 10 the address in the county in which he votes, except as 11 specified below, the position and the total salary paid to 12 him during the past calendar year. For persons employed by 13 the Department of Corrections, Department of Children and 14 Family Services and the Department of State Police no address 15 shall be listed. The list so compiled and arranged shall be 16 kept on file in the office of the comptroller and be open to 17 inspection by the public at all times. 18 No person who utilizes the names obtained from this list 19 for solicitation shall represent that such solicitation is 20 authorized by any officer or agency of the State of Illinois. 21 Violation of this provision is a Business Offense punishable 22 by a fine not to exceed $3,000. 23 (Source: P.A. 86-1003.) 24 Section 90-10. The Legislative Commission 25 Reorganization Act of 1984 is amended by changing Section 26 10-2 as follows: 27 (25 ILCS 130/10-2) (from Ch. 63, par. 1010-2) 28 Sec. 10-2. The Legislative Research Unit shall collect 29 information concerning the government and general welfare of 30 the State, examine the effects of constitutional provisions 31 and previously enacted statutes, consider important issues of 32 public policy and questions of state-wide interest, and HB2924 Engrossed -25- LRB9108568DJcsC 1 perform research and provide information as may be requested 2 by the members of the General Assembly or as the Joint 3 Committee on Legislative Support Services considers necessary 4 or desirable. 5 The Legislative Research Unit shall maintain an 6 up-to-date computerized record of the information required to 7 be reported to it by Section 1 of "An Act concerning State 8 boards and commissions and amending a named Act", enacted by 9 the 86th General Assembly, which information shall be a 10 public record under The Freedom of Information Act. The 11 Legislative Research Unit may prescribe forms for making 12 initial reports and reports of change under that Section, and 13 may request information to verify compliance with that 14 Section. 15 Each year, the Legislative Research Unit shall evaluate 16 the allocations and expenditures of moneys from the special 17 funds established under Section 5-15 of the Health First Plan 18 Law and shall conduct program evaluations to determine the 19 impact of the system for distributing moneys paid to the 20 State under the Master Settlement Agreement as defined in 21 that Law. The Legislative Research Unit may enter into 22 contracts with public or private entities to conduct the 23 evaluations. The Legislative Research Unit shall report the 24 evaluation findings each year to the General Assembly. 25 (Source: P.A. 86-591.) 26 Section 90-15. The Illinois State Auditing Act is 27 amended by changing Section 3-2 as follows: 28 (30 ILCS 5/3-2) (from Ch. 15, par. 303-2) 29 Sec. 3-2. Mandatory and directed post audits. The 30 Auditor General shall conduct a financial audit of each State 31 agency except the Auditor General or his office at least once 32 during every biennium, except as is otherwise provided in HB2924 Engrossed -26- LRB9108568DJcsC 1 regulations adopted under Section 3-8. At least once during 2 every biennium, the Auditor General shall conduct a financial 3 audit of all expenditures from the special funds established 4 under Section 5-15 of the Health First Plan Law. The general 5 direction and supervision of the financial audit program may 6 be delegated only to an individual who is a Certified Public 7 Accountant and a payroll employee of the Office of the 8 Auditor General. In the conduct of financial audits, the 9 Auditor General may inquire into and report upon matters 10 properly within the scope of a management or program audit, 11 provided that such inquiry shall be limited to matters 12 arising during the ordinary course of the financial audit. 13 In any year the Auditor General shall conduct any special 14 audits as may be necessary to form an opinion on the 15 financial report of this State, as prepared by the 16 Comptroller, and to certify that this presentation is in 17 accordance with generally accepted accounting principles for 18 government. 19 Simultaneously with the biennial financial audit of the 20 Department of Human Services, the Auditor General shall 21 conduct a program audit of each facility under the 22 jurisdiction of that Department that is described in Section 23 4 of the Mental Health and Developmental Disabilities 24 Administrative Act. The program audit shall include an 25 examination of the records of each facility concerning 26 reports of suspected abuse or neglect of any patient or 27 resident of the facility. The Auditor General shall report 28 the findings of the program audit to the Governor and the 29 General Assembly, including findings concerning patterns or 30 trends relating to abuse or neglect of facility patients and 31 residents. However, for any year for which the Inspector 32 General submits a report to the Governor and General Assembly 33 as required under Section 6.7 of the Abused and Neglected 34 Long Term Care Facility Residents Reporting Act, the Auditor HB2924 Engrossed -27- LRB9108568DJcsC 1 General need not conduct the program audit otherwise required 2 under this paragraph. 3 The Auditor General shall conduct a management or program 4 audit of a State agency when so directed by the Commission, 5 or by either house of the General Assembly, in a resolution 6 identifying the subject, parties and scope. Such a directing 7 resolution may: 8 (a) require the Auditor General to examine and 9 report upon specific management efficiencies or cost 10 effectiveness proposals specified therein; 11 (b) in the case of a program audit, set forth 12 specific program objectives, responsibilities or duties 13 or may specify the program performance standards or 14 program evaluation standards to be the basis of the 15 program audit; 16 (c) be directed at particular procedures or 17 functions established by statute, by administrative 18 regulation or by precedent; and 19 (d) require the Auditor General to examine and 20 report upon specific proposals relating to state programs 21 specified in the resolution. 22 The Commission may by resolution clarify, further direct, 23 or limit the scope of any audit directed by a resolution of 24 the House or Senate, provided that any such action by the 25 Commission must be consistent with the terms of the directing 26 resolution. 27 (Source: P.A. 89-427, eff. 12-7-95; 89-507, eff. 7-1-97.) 28 Section 90-20. The State Finance Act is amended by adding 29 Sections 5.541, 5.542, 5.543, 5.544, 5.545, and 5.546 and 30 changing Section 6z-43 as follows: 31 (30 ILCS 105/5.541 new) 32 Sec. 5.541. The Smoking/Tobacco Control Trust Fund. HB2924 Engrossed -28- LRB9108568DJcsC 1 (30 ILCS 105/5.542 new) 2 Sec. 5.542. The Healthy Communities Trust Fund. 3 (30 ILCS 105/5.543 new) 4 Sec. 5.543. The Seniors/Disabled Choices Trust Fund. 5 (30 ILCS 105/5.544 new) 6 Sec. 5.544. The Healthy Schools Trust Fund. 7 (30 ILCS 105/5.545 new) 8 Sec. 5.545. The Health and Medicine Endowment Fund. 9 (30 ILCS 105/5.546 new) 10 Sec. 5.546. The Health Infrastructure Fund. 11 (30 ILCS 105/6z-43) 12 Sec. 6z-43. Tobacco Settlement Recovery Fund. There is 13 created in the State Treasury a special fund to be known as 14 the Tobacco Settlement Recovery Fund into which shall be 15 deposited all monies paid to the State pursuant to (1) the 16 Master Settlement Agreement entered in the case of People of 17 the State of Illinois v. Philip Morris, et al. (Circuit Court 18 of Cook County, No. 96-L13146) and (2) any settlement with or 19 judgment against any tobacco product manufacturer other than 20 one participating in the Master Settlement Agreement in 21 satisfaction of any released claim as defined in the Master 22 Settlement Agreement, as well as any other monies as provided 23 by law. All earnings on Fund investments shall be deposited 24 into the Fund. Upon the creation of the Fund, the State 25 Comptroller shall order the State Treasurer to transfer into 26 the Fund any monies paid to the State as described in item 27 (1) or (2) of this Section before the creation of the Fund 28 plus any interest earned on the investment of those monies. 29 The State Treasurer shall administer the Fund as provided in HB2924 Engrossed -29- LRB9108568DJcsC 1 the Health First Plan Law. 2 (Source: P.A. 91-646, eff. 11-19-99.) 3 Section 90-99. Effective date. This Act takes effect 4 upon becoming law.