[ Search ] [ Legislation ]
[ Home ] [ Back ] [ Bottom ]
| [ Introduced ] | [ Engrossed ] | [ Enrolled ] |
| [ House Amendment 002 ] |
91_SB1627ham001
LRB9112143MWmbam01
1 AMENDMENT TO SENATE BILL 1627
2 AMENDMENT NO. . Amend Senate Bill 1627 on page 1,
3 line 5, after "13,", by inserting "15,"; and
4 on page 4, immediately below line 7, by inserting the
5 following:
6 "(30 ILCS 350/15) (from Ch. 17, par. 6915)
7 Sec. 15. Double-barrelled bonds. Whenever revenue bonds
8 have been authorized to be issued pursuant to applicable law
9 or whenever there exists for a governmental unit a revenue
10 source, the procedures set forth in this Section may be used
11 by a governing body. General obligation bonds may be issued
12 in lieu of such revenue bonds as authorized, and general
13 obligation bonds may be issued payable from any revenue
14 source. Such general obligation bonds may be referred to as
15 "alternate bonds". Alternate bonds may be issued without any
16 referendum or backdoor referendum except as provided in this
17 Section, upon the terms provided in Section 10 of this Act
18 without reference to other provisions of law, but only upon
19 the conditions provided in this Section. Alternate bonds
20 shall not be regarded as or included in any computation of
21 indebtedness for the purpose of any statutory provision or
22 limitation except as expressly provided in this Section.
-2- LRB9112143MWmbam01
1 Such conditions are:
2 (a) Alternate bonds shall be issued for a lawful
3 corporate purpose. If issued in lieu of revenue bonds,
4 alternate bonds shall be issued for the purposes for which
5 such revenue bonds shall have been authorized. If issued
6 payable from a revenue source in the manner hereinafter
7 provided, which revenue source is limited in its purposes or
8 applications, then the alternate bonds shall be issued only
9 for such limited purposes or applications. Alternate bonds
10 may be issued payable from either enterprise revenues or
11 revenue sources, or both.
12 (b) Alternate bonds shall be subject to backdoor
13 referendum. The provisions of Section 5 of this Act shall
14 apply to such backdoor referendum, together with the
15 provisions hereof. The authorizing ordinance shall be
16 published in a newspaper of general circulation in the
17 governmental unit. Along with or as part of the authorizing
18 ordinance, there shall be published a notice of (1) the
19 specific number of voters required to sign a petition
20 requesting that the issuance of the alternate bonds be
21 submitted to referendum, (2) the time when such petition must
22 be filed, (3) the date of the prospective referendum, and
23 (4), with respect to authorizing ordinances adopted on or
24 after January 1, 1991, a statement that identifies any
25 revenue source that will be used to pay the principal of and
26 interest on the alternate bonds. The clerk or secretary of
27 the governmental unit shall make a petition form available to
28 anyone requesting one. If no petition is filed with the
29 clerk or secretary within 30 days of publication of the
30 authorizing ordinance and notice, the alternate bonds shall
31 be authorized to be issued. But if within this 30 days
32 period, a petition is filed with such clerk or secretary
33 signed by electors numbering the greater of (i) 7.5% of the
34 registered voters in the governmental unit or (ii) 200 of
-3- LRB9112143MWmbam01
1 those registered voters or 15% of those registered voters,
2 whichever is less, asking that the issuance of such alternate
3 bonds be submitted to referendum, the clerk or secretary
4 shall certify such question for submission at an election
5 held in accordance with the general election law. The
6 question on the ballot shall include a statement of any
7 revenue source that will be used to pay the principal of and
8 interest on the alternate bonds. The alternate bonds shall be
9 authorized to be issued if a majority of the votes cast on
10 the question at such election are in favor thereof provided
11 that notice of the bond referendum, if held before July 1,
12 1999, has been given in accordance with the provisions of
13 Section 12-5 of the Election Code in effect at the time of
14 the bond referendum, at least 10 and not more than 45 days
15 before the date of the election, notwithstanding the time for
16 publication otherwise imposed by Section 12-5. Notices
17 required in connection with the submission of public
18 questions on or after July 1, 1999 shall be as set forth in
19 Section 12-5 of the Election Code. Backdoor referendum
20 proceedings for bonds and alternate bonds to be issued in
21 lieu of such bonds may be conducted at the same time.
22 (c) To the extent payable from enterprise revenues, such
23 revenues shall have been determined by the governing body to
24 be sufficient to provide for or pay in each year to final
25 maturity of such alternate bonds all of the following: (1)
26 costs of operation and maintenance of the utility or
27 enterprise, but not including depreciation, (2) debt service
28 on all outstanding revenue bonds payable from such enterprise
29 revenues, (3) all amounts required to meet any fund or
30 account requirements with respect to such outstanding revenue
31 bonds, (4) other contractual or tort liability obligations,
32 if any, payable from such enterprise revenues, and (5) in
33 each year, an amount not less than 1.25 times debt service of
34 all (i) alternate bonds payable from such enterprise revenues
-4- LRB9112143MWmbam01
1 previously issued and outstanding and (ii) alternate bonds
2 proposed to be issued. To the extent payable from one or
3 more revenue sources, such sources shall have been determined
4 by the governing body to provide in each year, an amount not
5 less than 1.25 times debt service of all alternate bonds
6 payable from such revenue sources previously issued and
7 outstanding and alternate bonds proposed to be issued. The
8 conditions enumerated in this subsection (c) need not be met
9 for that amount of debt service provided for by the setting
10 aside of proceeds of bonds or other moneys at the time of the
11 delivery of such bonds.
12 (c-1) In the case of alternate bonds issued as variable
13 rate bonds (including refunding bonds), debt service shall be
14 projected based on the rate for the most recent date shown in
15 the 20 G.O. Bond Index of average municipal bond yields as
16 published in the most recent edition of The Bond Buyer
17 published in New York, New York (or any successor publication
18 or index, or if such publication or index is no longer
19 published, then any index of long-term municipal tax-exempt
20 bond yields selected by the governmental unit), as of the
21 date of determination referred to in subsection (c) of this
22 Section. Any interest or fees that may be payable to the
23 provider of a letter of credit, line of credit, surety bond,
24 bond insurance, or other credit enhancement relating to such
25 alternate bonds and any fees that may be payable to any
26 remarketing agent need not be taken into account for purposes
27 of such projection. If the governmental unit enters into an
28 agreement in connection with such alternate bonds at the time
29 of issuance thereof pursuant to which the governmental unit
30 agrees for a specified period of time to pay an amount
31 calculated at an agreed-upon rate or index based on a
32 notional amount and the other party agrees to pay the
33 governmental unit an amount calculated at an agreed-upon rate
34 or index based on such notional amount, interest shall be
-5- LRB9112143MWmbam01
1 projected for such specified period of time on the basis of
2 the agreed-upon rate payable by the governmental unit.
3 (d) The determination of the sufficiency of enterprise
4 revenues or a revenue source, as applicable, shall be
5 supported by reference to the most recent audit of the
6 governmental unit, which shall be for a fiscal year ending
7 not earlier than 18 months previous to the time of issuance
8 of the alternate bonds. If such audit does not adequately
9 show such enterprise revenues or revenue source, as
10 applicable, or if such enterprise revenues or revenue source,
11 as applicable, are shown to be insufficient, then the
12 determination of sufficiency shall be supported by the report
13 of an independent accountant or feasibility analyst, the
14 latter having a national reputation for expertise in such
15 matters, demonstrating the sufficiency of such revenues and
16 explaining, if appropriate, by what means the revenues will
17 be greater than as shown in the audit. Whenever such
18 sufficiency is demonstrated by reference to a schedule of
19 higher rates or charges for enterprise revenues or a higher
20 tax imposition for a revenue source, such higher rates,
21 charges or taxes shall have been properly imposed by an
22 ordinance adopted prior to the time of delivery of alternate
23 bonds. The reference to and acceptance of an audit or
24 report, as the case may be, and the determination of the
25 governing body as to sufficiency of enterprise revenues or a
26 revenue source shall be conclusive evidence that the
27 conditions of this Section have been met and that the
28 alternate bonds are valid.
29 (e) The enterprise revenues or revenue source, as
30 applicable, shall be in fact pledged to the payment of the
31 alternate bonds; and the governing body shall covenant, to
32 the extent it is empowered to do so, to provide for, collect
33 and apply such enterprise revenues or revenue source, as
34 applicable, to the payment of the alternate bonds and the
-6- LRB9112143MWmbam01
1 provision of not less than an additional .25 times debt
2 service. The pledge and establishment of rates or charges
3 for enterprise revenues, or the imposition of taxes in a
4 given rate or amount, as provided in this Section for
5 alternate bonds, shall constitute a continuing obligation of
6 the governmental unit with respect to such establishment or
7 imposition and a continuing appropriation of the amounts
8 received. All covenants relating to alternate bonds and the
9 conditions and obligations imposed by this Section are
10 enforceable by any bondholder of alternate bonds affected,
11 any taxpayer of the governmental unit, and the People of the
12 State of Illinois acting through the Attorney General or any
13 designee, and in the event that any such action results in an
14 order finding that the governmental unit has not properly set
15 rates or charges or imposed taxes to the extent it is
16 empowered to do so or collected and applied enterprise
17 revenues or any revenue source, as applicable, as required by
18 this Act, the plaintiff in any such action shall be awarded
19 reasonable attorney's fees. The intent is that such
20 enterprise revenues or revenue source, as applicable, shall
21 be sufficient and shall be applied to the payment of debt
22 service on such alternate bonds so that taxes need not be
23 levied, or if levied need not be extended, for such payment.
24 Nothing in this Section shall inhibit or restrict the
25 authority of a governing body to determine the lien priority
26 of any bonds, including alternate bonds, which may be issued
27 with respect to any enterprise revenues or revenue source.
28 In the event that alternate bonds shall have been issued
29 and taxes, other than a designated revenue source, shall have
30 been extended pursuant to the general obligation, full faith
31 and credit promise supporting such alternate bonds, then the
32 amount of such alternate bonds then outstanding shall be
33 included in the computation of indebtedness of the
34 governmental unit for purposes of all statutory provisions or
-7- LRB9112143MWmbam01
1 limitations until such time as an audit of the governmental
2 unit shall show that the alternate bonds have been paid from
3 the enterprise revenues or revenue source, as applicable,
4 pledged thereto for a complete fiscal year.
5 Alternate bonds may be issued to refund or advance refund
6 alternate bonds without meeting any of the conditions set
7 forth in this Section, except that the term of the refunding
8 bonds shall not be longer than the term of the refunded bonds
9 and that the debt service payable in any year on the
10 refunding bonds shall not exceed the debt service payable in
11 such year on the refunded bonds.
12 Once issued, alternate bonds shall be and forever remain
13 until paid or defeased the general obligation of the
14 governmental unit, for the payment of which its full faith
15 and credit are pledged, and shall be payable from the levy of
16 taxes as is provided in this Act for general obligation
17 bonds.
18 The changes made by this amendatory Act of 1990 do not
19 affect the validity of bonds authorized before September 1,
20 1990.
21 (Source: P.A. 90-812, eff. 1-26-99; 91-57, eff. 6-30-99;
22 91-493, eff. 8-13-99; revised 10-9-99.)".