(105 ILCS 5/34B‑1)(from Ch. 122, par. 34B‑1) Sec. 34B‑1. As used in this Article "Board" means the board of education of
any school district located in a city having a population in excess of 500,000;
"School District" means any such school district; and "City" means any such city. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑2)(from Ch. 122, par. 34B‑2) Sec. 34B‑2. Prior to August 1, 1980, any City may, pursuant to a request
or requests of the Board, from time to time borrow money and issue, at the
option of the City, either general obligation notes secured by the full
faith and credit of the City or other notes of the City (hereinafter called
the "Notes"), for the purpose of providing
financing for the Board, in an amount not to exceed 85% of the tax to be
extended in any calendar year
for a specific purpose of such Board for the school fiscal year during which the
Notes are issued, after deducting the amount of any general obligation tax
anticipation notes and tax anticipation warrants previously issued against
the tax to be extended for such purpose for such school fiscal year on behalf of the
Board. From and after the issuance of any Notes, no tax anticipation warrants
shall be issued against the tax extended for such purpose for such year
on behalf of the Board. Notes may also be issued to refund any Notes theretofore
issued and remaining unpaid and outstanding. The proceeds of the Notes,
other than refunding Notes, after paying costs of issuance, shall be advanced
by the City to the Board and
applied by the Board for the purpose for which such tax was extended. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑3)(from Ch. 122, par. 34B‑3) Sec. 34B‑3. The Notes shall bear interest at such rate or rates as shall be determined
by ordinance of the City as hereinafter provided, which rate or rates shall
not be limited by any interest rate limitation provided by law including,
without limitation, the limitation contained in Section 2 of "An Act to authorize
public corporations to issue bonds, other evidences of indebtedness and
tax anticipation warrants subject to interest rate limitations set forth
therein", approved May 26, 1970, as amended. The Notes shall bear interest
from the date of their
issuance until paid in full, but no interest shall be payable prior to the
earlier of the date of any prepayment thereof or October 1, 1980. The Notes
shall mature within two years from the date of their issuance. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑4)(from Ch. 122, par. 34B‑4) Sec. 34B‑4. In order to authorize and issue the Notes, the city council
of the City shall adopt an ordinance fixing the amount of Notes, the date
thereof, the maturity thereof, the rate or rates of interest thereon, the
security therefor, optional provisions, if any, the place of payment and
the denomination or denominations thereof (which shall be in denominations
of $1,000 or integral multiples
thereof). The Notes may, by such ordinance, be made subject to prepayment
from any monies available to the City for that purpose, including, without
limitation, monies made available to the City by the Board,
by any other authority or board now or subsequently established by the State
for the purpose, among others, of providing
financing for the Board, or by other public body, from the proceeds of indebtedness
incurred for such purpose by the Board, any such authority or board or any such
other public body. Such ordinance shall provide for the levy and collection
of a direct annual tax upon all the taxable property in the City without
limit as to rate or amount sufficient
to pay the principal of and interest on the Notes to maturity. If for any
reason the amount collected from the tax so levied, together with other
moneys available for that purpose, shall not be sufficient to pay the principal
of and interest on the Notes when due, the city council of the City shall,
by ordinance, provide for the levy and collection of additional direct annual
taxes upon all the taxable property in the City without limit as to rate
or amount sufficient for such purpose.
Upon the filing in the office of the county clerk in each county in which
the City is located of a certified copy of any such ordinance, it shall
be the duty of each such county clerk annually to extend the tax therein
provided for, including an amount to cover loss and cost of collection and
also deferred collections thereof and abatements in the amounts of such
taxes as extended upon the collector's books. Such tax or taxes shall be
levied and collected in like manner with the other taxes of the City and
the Board and shall be in addition to and in excess of all other taxes heretofore
or hereafter
authorized to be levied by or on behalf of the City or the Board. Any such
ordinance shall be in force upon its adoption, provided that the City Council
by a vote of a majority of all the members then holding office shall so
direct, notwithstanding any other provision of law. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑5)(from Ch. 122, par. 34B‑5) Sec. 34B‑5. From and after the issuance of the Notes as provided for by
this Article, it shall be the duty of the
county clerk of each county in which the City is located, in computing the
tax rates for the specific purposes of the Board for which Notes authorized
by this Article were issued, to reduce the tax rate for each such specific purpose
by the percent necessary to produce an amount to pay the principal of and
interest on the Notes issued pursuant to this Article for each such specific purpose.
At such time as there are no Notes outstanding, all proceeds of taxes levied
to pay the principal of and interest on the Notes shall be paid by the Collector
to the City and by the City paid to the Board to be applied for the specific
purpose of the Board for which the Notes were issued. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑6)(from Ch. 122, par. 34B‑6) Sec. 34B‑6. The Notes shall be executed in the name of the City by manual
or facsimile signatures of such officials of the City as may be designated
by the ordinance authorizing the Notes. At least one signature on each
Note shall be a manual signature. The Notes shall be sold by the City on
such terms as may be approved by the city council of the City in the ordinance
authorizing the Notes without any requirement of advertising for bids. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑7)(from Ch. 122, par. 34B‑7) Sec. 34B‑7. The Notes and the Board Notes (provided for in Section 34B‑9 of
this Article) may be issued in excess of any statutory limitation as to debt
and shall not operate to reduce the debt incurring power otherwise authorized
for the City, the Board or any authority or board established by the State
for the purpose, among others, of providing financing for the Board. This
Article shall not be construed to limit in any manner the amount
of debt which home rule units may incur under Section 6 (a), (j) or (k)
of Article VII of the Constitution of the State of Illinois nor shall
a referendum be required to incur such debt. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑8)(from Ch. 122, par. 34B‑8) Sec. 34B‑8. Upon the issuance of any Notes, the City shall establish with
respect to each such issue of Notes a
debt service fund (herein called the "Debt Service Fund") to be maintained
by a corporate trustee which may be any trust company or bank having the
power of a trust company within the State (herein called the "Trustee")
separate and segregated from all other funds and accounts of the City or
the Board. The county collector of each county in which the City is located
shall pay the proceeds of all taxes levied for the payment of the principal
of and interest on the Notes upon receipt by the county collector directly
to the Trustee to be
held in trust in such Debt Service Fund for the benefit of the holders of
the Notes. All such proceeds of such taxes shall be applied solely for the
payment of principal of and interest on the Notes and shall not be used
for any other purpose so long as any Notes remain outstanding. Any such
levy shall be for the sole benefit of the holders of the Notes and such
holders shall have a security interest in and lien upon all rights, claims
and interests of the City arising pursuant to any such levy and all present
and future proceeds of such levy until the principal of and interest on
the Notes are paid in full. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑9)(from Ch. 122, par. 34B‑9) Sec. 34B‑9. Any advance by the City to the Board of the proceeds of any
issue of the Notes pursuant to Section 34B‑2 of this Article shall be evidenced
by one or more
general obligation notes of the Board (herein called the "Board Notes").
The Board Notes shall be authorized by a resolution of the Board, shall
bear interest at a rate or rates equal to the rate or rates of interest
on the Notes, and shall be of like date and maturity as the date and maturity
of the Notes. The Board Notes shall be issued in an aggregate principal
amount equal to the
aggregate amount of all advances by the City to the Board pursuant to Section
34B‑2 of this Article. The Board Notes shall be direct general obligations of the
Board payable from any monies of the board, not prohibited by law, for payment
of the Board Notes, and the full faith and credit of the Board shall be pledged
for the punctual payment of the principal of and interest on the Board Notes.
The Board Notes shall be issued by the Board to the City and may be pledged
and assigned by the City for the benefit of the holders of the Notes as
security for the obligation of the City to pay the principal of and interest
on the Notes. Concurrently with the payment or prepayment of principal of
and interest on the Notes, whether from the proceeds of taxes levied for
such purpose, from Available Revenues (referred to in Section 34B‑10 of this
Article), or otherwise, the obligation of the Board to pay principal of and
interest on the Board Notes shall be discharged to the extent of such payment
or prepayment of principal of and interest on the Notes. Upon discharge
in full the Board Notes shall
be cancelled and returned to the Board. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑10)(from Ch. 122, par. 34B‑10) Sec. 34B‑10. As security for the obligation of the Board to pay the principal
of and interest on the Board Notes when due, the Board may, in the resolution
of the Board authorizing the Board Notes, pledge and assign to the City,
and grant to the City a lien on and security interest in all amounts (whether
previously appropriated or subject to future appropriation) paid, payable
or designated for payment by the State directly or indirectly to or for
the account of the Board to the extent not required to pay State Aid Certificates
of the Board issued prior to March 1, 1980, and which are not prohibited
by law for the payment of
the principal of or interest on the Board Notes and the Notes, and which
have not, prior to the issuance of the Notes, been pledged, assigned, hypothecated
or otherwise encumbered (herein called "Available
Revenues"). As security for the obligation of the City to pay the principal
of and interest on the Notes, the City may pledge and assign to the holders of the
Notes, and grant to such holders a lien on and security interest in, all
of the City's right, title and interest in and to Available Revenues pledged
and assigned
by the Board to the City. In such event the Board and the City shall deliver
written notice of such pledges, assignments, liens and security interests,
together with certified copies of the resolution of the Board authorizing
the issuance of the Board Notes and the ordinance of the City authorizing
the issuance of the Notes, to the State Comptroller, the State Treasurer, the State
Superintendent of Education
whereupon such officials shall execute
and deliver to the Board, the City and the Trustee acknowledgements of receipt
of such notice and of their respective obligations under Section 34B‑11 of this Act. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑11)(from Ch. 122, par. 34B‑11) Sec. 34B‑11. In the event that Available Revenues are pledged and assigned
by the Board to the City and pledged and assigned by the City to the holders
of the Notes as provided in Section 34B‑10 of this Article, then the resolution
of the Board authorizing the issuance of the Board Notes and the ordinance
of the City authorizing issuance of the Notes may provide that if on the
thirty‑fifth (35th) day prior to any date on which any payment of principal
of or interest
on the Notes is due, the monies then on deposit in the Debt Service Fund
are insufficient to make such payment when due, the Trustee shall send written
notification of such fact to the State Comptroller. From and after the
receipt by the State Comptroller of such notification, the State Comptroller,
the State Treasurer and the State Superintendent of Education
shall pay or cause to be paid directly
to the Trustee for deposit in the Debt Service Fund for payment of the principal
of and interest on Notes all Available Revenues at such time or times as
Available Revenues would otherwise be paid by the state, until such time
as the amount on deposit in the Debt Service Fund is sufficient to pay in
full the unpaid principal of the Notes due on such payment date and interest
accrued on the Notes, and from and after such notification to the State Comptroller and
until such time as the amount on deposit in the Debt Service Fund is sufficient
to pay in full the unpaid principal of the Notes due on such payment date
and interest accrued on the Notes no Available Revenues shall be paid by
the state directly
or indirectly for any public school purposes in the School District except to the
Trustee as hereinabove provided. At such time as the amount on deposit
in the Debt Service Fund is sufficient for such purpose, the Trustee shall
notify the State Comptroller of such fact. Any Available Revenues paid
or caused to be paid by such state officials to the Trustee for deposit
in the Debt Service Fund shall be held in trust in the Debt Service Fund
for the benefit of the holders of the Notes, shall be applied solely for
the payment of principal of and interest on the Notes and shall not be used
for any other purpose so long as any Notes remain outstanding. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑12)(from Ch. 122, par. 34B‑12) Sec. 34B‑12. Any monies deposited in the Debt Service Fund in excess of
the amount necessary to pay in full the principal of and interest on the
Notes shall be paid by the Trustee to the City for payment to the Board
for use by the Board for the lawful purposes of the Board. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑13)(from Ch. 122, par. 34B‑13) Sec. 34B‑13. In the event that Available Revenues are pledged and assigned
by the Board to the City and pledged and assigned by the City to the holders
of the Notes as provided in Section 34B‑10 of this Article, then the resolution
of the Board authorizing the issuance of the Board Notes and the ordinance
of the City authorizing issuance of the Notes may provide that any holder
of any Note may present from and after October 1, 1980, but in any event
prior to October 15, 1980, to the Trustee which shall present to the State
Comptroller a notification, in
such form as shall be provided for in the ordinance of the City authorizing
the issuance of such Note, of the election of such holder to receive payment
of the principal of and interest on such Note ("Presented Note") from first
payments of Available Revenues. From and after the receipt by the State
Comptroller any of such notification
relating to a Presented Note, the State Comptroller, the State Treasurer
and the State Superintendent of Education
shall pay or cause to be paid all Available Revenues directly to the
Trustee at such time or times as Available Revenues would otherwise be paid
by the State until such time as the aggregate amount so paid or caused to
be paid from time to time by such officials to the Trustee is equal to the
aggregate unpaid principal of, and
interest accrued on all Presented Notes to the date of such payment on such
Presented Note. The ordinance authorizing the issuance of the Notes may
provide that such Available Revenues shall be applied by the Trustee to
the prepayment of the principal of and accrued interest on the Presented
Notes, pari passu, either (i) in whole only at such time as the Trustee
has received sufficient amounts to make such prepayment in whole or (ii)
in part, from time to time, to the extent of the amounts from time to time
received by the Trustee, such partial prepayments to be made at such times
and in such manner as may be authorized in such ordinance. To the extent
that the Presented Note is for any reason not prepaid in full as to both
principal and interest prior to maturity from Available Revenues, such Presented
Note shall remain payable from the same sources and secured in the same
manner as though the holder of such Note had not given the notification
as hereinabove provided. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑14)(from Ch. 122, par. 34B‑14) Sec. 34B‑14. Any pledge, assignment, lien or security interest for the
benefit of the holders of the Notes made or created pursuant to this Article
shall be valid
and binding from the time the Notes are issued, without any physical delivery
or further act, and shall be valid and binding as against, and prior to
any claims of, all other parties having claims of any kind in tort, contract
or otherwise, against the City, the Board, the State, any authority or board
established by the State for the purpose, among others, of providing financing
to the Board, or any other person, irrespective of whether such other parties
have notice thereof. (Source: P.A. 81‑1222.)
(105 ILCS 5/34B‑15)(from Ch. 122, par. 34B‑15) Sec. 34B‑15. Any monies on deposit in the Debt Service Fund or otherwise
held by the Trustee and not necessary for immediate use may be invested
or reinvested at the direction of the City in Governmental Obligations or
in certificates of deposit of any federally insured bank or savings and
loan association with capital and undivided surplus or reserves of more
than $10,000,000. No bank or savings and loan association shall receive public funds as
permitted by this Section, unless it has complied with the requirements
established pursuant to Section 6 of "An Act relating to certain investments
of public funds by public agencies", approved July 23, 1943, as now or hereafter
amended. "Governmental Obligations" means any of the following which at the time
of investment are legal investments under the laws of the State for the
monies proposed to be invested therein: (i) direct general obligations of, or obligations the payment of the principal
of and interest on which are unconditionally guaranteed by, the United States
of America; (ii) bonds, debentures or notes issued by any of the following federal
agencies: Bank for Co‑operatives, Federal Financing Bank, Federal Land Banks,
Federal Home Loan Banks or Federal Home Loan Mortgage Corporation (including
Participation Certificates); or (iii) Public Housing Bond, Temporary Notes or Preliminary Loan Notes,
fully secured by contracts with the United States of America. (Source: P.A. 83‑541.)
(105 ILCS 5/34B‑16)(from Ch. 122, par. 34B‑16) Sec. 34B‑16. This Article, without reference to any other statute, shall constitute
full and complete authority for the issuance of the Notes and the Board Notes
as hereinabove provided and shall be construed as an additional or alternate
method thereof. Neither the Notes nor the Board Notes shall constitute a debt of the State of Illinois. (Source: P.A. 81‑1222.)
Disclaimer: These codes may not be the most recent version. Illinois may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
