101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB2940

 

Introduced 2/4/2020, by Sen. Ann Gillespie

 

SYNOPSIS AS INTRODUCED:
 
New Act
30 ILCS 575/5  from Ch. 127, par. 132.605
220 ILCS 5/5-117

    Creates the Not-for-Profit Business Enterprise Act. Allows for the certification of and the preference in awarding of State contracts to minority-led not-for-profit organizations, woman-led not-for-profit organizations, and not-for-profit organizations led by a person with a disability under the Act. Provides further requirements concerning the awarding of State contracts and certification. Requires State agencies and institutions of higher education to annually file with the Business Enterprise Council a compliance plan for contracting with minority-led not-for-profit organizations, woman-led not-for-profit organizations, and not-for-profit organizations led by a person with a disability. Provides enforcement provisions. Provides for the adoption of rules necessary to implement and enforce the requirements of the Act. Amends the Business Enterprise for Minorities, Women, and Persons with Disabilities Act. Provides the Business Enterprise Council with the authority and responsibility to devise a certification procedure for not-for-profit organizations and to make a list of all not-for-profit organizations legitimately classified as a minority-led not-for-profit organization, a woman-led not-for-profit organization, or a not-for-profit organization led by a person with a disability for purposes of the Not-for-Profit Business Enterprise Act. Amends the Public Utilities Act. Provides that specified supplier diversity goal requirements under the Act apply to minority-led not-for-profit organizations, woman-led not-for-profit organizations, and not-for-profit organizations led by a person with a disability. Defines terms. Makes other changes.


LRB101 19773 RJF 69283 b

 

 

A BILL FOR

 

SB2940LRB101 19773 RJF 69283 b

1    AN ACT concerning finance.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the
5Not-for-Profit Business Enterprise Act.
 
6    Section 5. Definitions. As used in this Act:
7    "Board of Directors" has the same meaning as provided under
8subsection (d) of Section 101.80 of the General Not For Profit
9Corporation Act of 1986.
10    "Business Enterprise Council" or "Council" means the
11Business Enterprise Council for Minorities, Women, and Persons
12with Disabilities created under Section 5 of the Business
13Enterprise for Minorities, Women, and Persons with
14Disabilities Act.
15    "Certification" means a determination made by the Business
16Enterprise Council, or by one delegated authority from the
17Council to make certifications, or by a State agency with
18statutory authority to make such a certification, that a
19not-for-profit organization meets the defined classifications
20of a "minority-led not-for-profit organization", a "woman-led
21not-for-profit organization", or a "not-for-profit
22organization led by a person with a disability".
23    "Key employees" means an employee of the organization who

 

 

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1is:
2        (1) the person who has ultimate responsibility for
3    implementing the decisions of the Board of Directors or for
4    supervising the management, administration, or operation
5    of the organization;
6        (2) the person who has ultimate responsibility for
7    managing the organization's finances; or
8        (3) the person who:
9            (A) has responsibilities, powers, or influence
10        over the organization as a whole that is similar to the
11        persons described in paragraphs (1) and (2);
12            (B) manages a discrete segment or activity of the
13        organizations that represents 25% or more of the
14        activities, assets, income, or expenses of the
15        organization, as compared to the organization as a
16        whole, or has or shares authority to control or
17        determine 25% or more of the organization's capital
18        expenditures, operating budget, or compensation for
19        employees; and
20            (C) is one of the 5 highest compensated employees
21        in the organization.
22    "Minority-led not-for-profit organization" means an
23organization that is tax-exempt under Sections 501(c)(3) or
24501(c)(4) of the Internal Revenue Code of 1986, and for which:
25        (1) at least 51% of the organization's Board of
26    Directors are minority persons, or at least 51% of the

 

 

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1    organization's Board of Directors and key employees are
2    minority persons;
3        (2) the organization is regularly and actively engaged
4    in the activity for which it is formed;
5        (3) the organization is not dependent upon or
6    influenced by another non-eligible person or organization;
7    and
8        (4) the organization has not been established or
9    reorganized for the specific purpose of participating in
10    the Business Enterprise Program.
11    "Not-for-profit organization led by a person with a
12disability" means an organization that is tax-exempt under
13Sections 501(c)(3) or 501(c)(4) of the Internal Revenue Code of
141986, and for which:
15        (1) at least 51% of the organization's Board of
16    Directors are persons with a disability, or at least 51% of
17    the organization's Board of Directors and key employees are
18    persons with a disability;
19        (2) the organization is regularly and actively engaged
20    in the activity for which it is formed;
21        (3) the organization is not dependent upon or
22    influenced by another non-eligible person or organization;
23    and
24        (4) the organization has not been established or
25    reorganized for the specific purpose of participating in
26    the Business Enterprise Program.

 

 

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1    "Public institution of higher education" means the
2University of Illinois, Southern Illinois University, Chicago
3State University, Eastern Illinois University, Governors State
4University, Illinois State University, Northeastern Illinois
5University, Northern Illinois University, Western Illinois
6University, the public community colleges of the State, and any
7other public universities, colleges, and community colleges
8now or hereafter established or authorized by the General
9Assembly.
10    "State agency" means and includes all boards, commissions,
11agencies, institutions, authorities, and bodies politic and
12corporate of the State.
13    "State contracts" means all contracts entered into by the
14State, any agency or department thereof, or any public
15institution of higher education, including community college
16districts, regardless of the source of the funds with which the
17contracts are paid, which are not subject to federal
18reimbursement. "State contracts" does not include contracts
19awarded by a retirement system, pension fund, or investment
20board subject to Section 1-109.1 of the Illinois Pension Code.
21    "Woman-led not-for-profit organization" means an
22organization that is tax-exempt under Sections 501(c)(3) or
23501(c)(4) of the Internal Revenue Code of 1986, and for which:
24        (1) at least 51% of the organization's Board of
25    Directors are women, or at least 51% of the organization's
26    Board of Directors and key employees are women;

 

 

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1        (2) the organization is regularly and actively engaged
2    in the activity for which it is formed;
3        (3) the organization is not dependent upon or
4    influenced by another non-eligible person or organization;
5    and
6        (4) the organization has not been established or
7    reorganized for the specific purpose of participating in
8    the Business Enterprise Program.
 
9    Section 10. Award of State contracts. Not less than 10% of
10the total dollar amount of State contracts shall be established
11as an aspirational goal to be awarded to minority-led
12not-for-profit organizations, woman-led not-for-profit
13organizations, and not-for-profit organizations led by a
14person with a disability. The percentage established under this
15Section relates to the total dollar amount of State contracts
16during each State fiscal year, calculated by examining
17independently each type of contract for each State agency or
18public institution of higher education which lets such
19contracts. Only that percentage of arrangements which
20represents the participation of minority-led not-for-profit
21organizations, woman-led not-for-profit organizations, and
22not-for-profit organizations led by a person with a disability
23on such contracts shall be included.
 
24    Section 15. Certification.

 

 

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1    (a) For the purpose of assuring that a not-for-profit
2organization taking advantage of this Act is legitimately
3classified as a minority-led not-for-profit organization, a
4woman-led not-for-profit organization, or a not-for-profit
5organization led by a person with a disability, the Business
6Enterprise Council shall devise a certification procedure to
7classify such organizations. The Council shall also maintain a
8list of all not-for-profit organizations legitimately
9classified as a minority-led not-for-profit organization, a
10woman-led not-for-profit organization, or a not-for-profit
11organization led by a person with a disability to provide to
12State agencies and public institutions of higher education
13entering into State contracts under this Act.
14    (b) When a not-for-profit organization's Board of
15Directors, or the Board of Directors together with key
16employees, consists of at least 51% of any combination of
17minority persons, women, or persons with disabilities, even
18though none of the 3 classes alone holds at least a 51% share,
19the 51% membership requirement for purposes of certification
20under this Act shall be considered met. The certification
21category for not-for-profit organizations shall be that of the
22class holding the largest share of positions on the Board of
23Directors, or on the Board of Directors together with key
24employees, of a not-for-profit organization. If 2 or more
25classes have an equal share of positions on the Board of
26Directors, or on the Board of Directors together with key

 

 

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1employees, the certification category shall be determined by
2the not-for-profit organization.
 
3    Section 20. Agency compliance plans. Each State agency and
4public institution of higher education under the jurisdiction
5of this Act shall file with the Business Enterprise Council an
6annual compliance plan which shall outline the goals of the
7State agency or public institution of higher education for
8contracting with minority-led not-for-profit organizations,
9woman-led not-for-profit organizations, and not-for-profit
10organizations led by a person with a disability for the then
11current fiscal year, the manner in which the agency intends to
12reach those goals, and a timetable for reaching those goals.
13The Council shall review and approve the plan of each State
14agency and public institution of higher education and may
15reject any plan that does not comply with this Act.
 
16    Section 25. Enforcement. The Business Enterprise Council
17shall make such findings, recommendations, and proposals to the
18Governor as are necessary and appropriate to enforce this Act.
19If, as a result of its monitoring activities, the Council
20determines that its goals and policies are not being met by any
21State agency or public institution of higher education, the
22Council may recommend any actions necessary to enforce
23compliance with this Act and compliance with contracts entered
24into under this Act.
 

 

 

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1    Section 30. Rules. The Business Enterprise Council shall
2adopt any rules necessary to implement and enforce the
3requirements of this Act.
 
4    Section 100. The Business Enterprise for Minorities,
5Women, and Persons with Disabilities Act is amended by changing
6Section 5 as follows:
 
7    (30 ILCS 575/5)  (from Ch. 127, par. 132.605)
8    (Section scheduled to be repealed on June 30, 2024)
9    Sec. 5. Business Enterprise Council.
10    (1) To help implement, monitor and enforce the goals of
11this Act, there is created the Business Enterprise Council for
12Minorities, Women, and Persons with Disabilities, hereinafter
13referred to as the Council, composed of the Secretary of Human
14Services and the Directors of the Department of Human Rights,
15the Department of Commerce and Economic Opportunity, the
16Department of Central Management Services, the Department of
17Transportation and the Capital Development Board, or their duly
18appointed representatives, with the Comptroller, or his or her
19designee, serving as an advisory member of the Council. Ten
20individuals representing businesses that are minority-owned or
21women-owned or owned by persons with disabilities, 2
22individuals representing the business community, and a
23representative of public institutions of higher education

 

 

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1shall be appointed by the Governor. These members shall serve 2
2year terms and shall be eligible for reappointment. Any vacancy
3occurring on the Council shall also be filled by the Governor.
4Any member appointed to fill a vacancy occurring prior to the
5expiration of the term for which his predecessor was appointed
6shall be appointed for the remainder of such term. Members of
7the Council shall serve without compensation but shall be
8reimbursed for any ordinary and necessary expenses incurred in
9the performance of their duties.
10    The Director of the Department of Central Management
11Services shall serve as the Council chairperson and shall
12select, subject to approval of the council, a Secretary
13responsible for the operation of the program who shall serve as
14the Division Manager of the Business Enterprise for Minorities,
15Women, and Persons with Disabilities Division of the Department
16of Central Management Services.
17    The Director of each State agency and the chief executive
18officer of each public institutions of higher education shall
19appoint a liaison to the Council. The liaison shall be
20responsible for submitting to the Council any reports and
21documents necessary under this Act.
22    (2) The Council's authority and responsibility shall be to:
23        (a) Devise a certification procedure to assure that
24    businesses taking advantage of this Act are legitimately
25    classified as businesses owned by minorities, women, or
26    persons with disabilities and a registration procedure to

 

 

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1    recognize, without additional evidence of Business
2    Enterprise Program eligibility, the certification of
3    businesses owned by minorities, women, or persons with
4    disabilities certified by the City of Chicago, Cook County,
5    or other jurisdictional programs with requirements and
6    procedures equaling or exceeding those in this Act.
7        (a-5) Devise a certification procedure to assure that
8    not-for-profit organizations taking advantage of the
9    Not-for-Profit Business Enterprise Act are legitimately
10    classified as a minority-led not-for-profit organization,
11    a woman-led not-for-profit organization, or a
12    not-for-profit organization led by a person with a
13    disability, as those classifications are defined under
14    that Act.
15        (b) Maintain a list of all businesses legitimately
16    classified as businesses owned by minorities, women, or
17    persons with disabilities to provide to State agencies and
18    public institutions of higher education.
19        (b-5) Maintain a list of all not-for-profit
20    organizations legitimately classified as a minority-led
21    not-for-profit organization, a woman-led not-for-profit
22    organization, or a not-for-profit organization led by a
23    person with a disability, as those classifications are
24    defined under the Not-for-Profit Business Enterprise Act,
25    and provide that list to State agencies and public
26    institutions of higher education.

 

 

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1        (c) Review rules and regulations for the
2    implementation of the program for businesses owned by
3    minorities, women, and persons with disabilities.
4        (d) Review compliance plans submitted by each State
5    agency and public institutions of higher education
6    pursuant to this Act.
7        (e) Make annual reports as provided in Section 8f to
8    the Governor and the General Assembly on the status of the
9    program.
10        (f) Serve as a central clearinghouse for information on
11    State contracts, including the maintenance of a list of all
12    pending State contracts upon which businesses owned by
13    minorities, women, and persons with disabilities may bid.
14    At the Council's discretion, maintenance of the list may
15    include 24-hour electronic access to the list along with
16    the bid and application information.
17        (g) Establish a toll free telephone number to
18    facilitate information requests concerning the
19    certification process and pending contracts.
20    (3) No premium bond rate of a surety company for a bond
21required of a business owned by a minority, woman, or person
22with a disability bidding for a State contract shall be higher
23than the lowest rate charged by that surety company for a
24similar bond in the same classification of work that would be
25written for a business not owned by a minority, woman, or
26person with a disability.

 

 

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1    (4) Any Council member who has direct financial or personal
2interest in any measure pending before the Council shall
3disclose this fact to the Council and refrain from
4participating in the determination upon such measure.
5    (5) The Secretary shall have the following duties and
6responsibilities:
7        (a) To be responsible for the day-to-day operation of
8    the Council.
9        (b) To serve as a coordinator for all of the State's
10    programs for businesses owned by minorities, women, and
11    persons with disabilities and as the information and
12    referral center for all State initiatives for businesses
13    owned by minorities, women, and persons with disabilities.
14        (c) To establish an enforcement procedure whereby the
15    Council may recommend to the appropriate State legal
16    officer that the State exercise its legal remedies which
17    shall include (1) termination of the contract involved, (2)
18    prohibition of participation by the respondent in public
19    contracts for a period not to exceed 3 years, (3)
20    imposition of a penalty not to exceed any profit acquired
21    as a result of violation, or (4) any combination thereof.
22    Such procedures shall require prior approval by Council.
23    All funds collected as penalties under this subsection
24    shall be used exclusively for maintenance and further
25    development of the Business Enterprise Program and
26    encouragement of participation in State procurement by

 

 

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1    minorities, women, and persons with disabilities.
2        (d) To devise appropriate policies, regulations and
3    procedures for including participation by businesses owned
4    by minorities, women, and persons with disabilities as
5    prime contractors including, but not limited to, (i)
6    encouraging the inclusions of qualified businesses owned
7    by minorities, women, and persons with disabilities on
8    solicitation lists, (ii) investigating the potential of
9    blanket bonding programs for small construction jobs,
10    (iii) investigating and making recommendations concerning
11    the use of the sheltered market process.
12        (e) To devise procedures for the waiver of the
13    participation goals in appropriate circumstances.
14        (f) To accept donations and, with the approval of the
15    Council or the Director of Central Management Services,
16    grants related to the purposes of this Act; to conduct
17    seminars related to the purpose of this Act and to charge
18    reasonable registration fees; and to sell directories,
19    vendor lists and other such information to interested
20    parties, except that forms necessary to become eligible for
21    the program shall be provided free of charge to a business
22    or individual applying for the program.
23(Source: P.A. 100-391, eff. 8-25-17; 100-801, eff. 8-10-18;
24101-601, eff. 1-1-20.)
 
25    Section 105. The Public Utilities Act is amended by

 

 

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1changing Section 5-117 as follows:
 
2    (220 ILCS 5/5-117)
3    Sec. 5-117. Supplier diversity goals.
4    (a) The public policy of this State is to collaboratively
5work with companies and not-for-profit organizations that
6serve Illinois residents to improve their supplier diversity in
7a non-antagonistic manner.
8    (a-5) For the purposes of this Section, "minority-led
9not-for-profit organization", "woman-led not-for-profit
10organization", and "not-for-profit organization led by a
11person with a disability" shall have the same meanings as
12provided under the Not-for-Profit Business Enterprise Act.
13    (b) The Commission shall require all gas, electric, and
14water companies with at least 100,000 customers under its
15authority, as well as suppliers of wind energy, solar energy,
16hydroelectricity, nuclear energy, and any other supplier of
17energy within this State, to submit an annual report by April
1815, 2015 and every April 15 thereafter, in a searchable Adobe
19PDF format, on all procurement goals and actual spending for
20female-owned, minority-owned, veteran-owned, person with a
21disability-owned, and small business enterprises, as well as
22minority-led not-for-profit organizations, woman-led
23not-for-profit organizations, and not-for-profit organizations
24led by a person with a disability, in the previous calendar
25year. These goals shall be expressed as a percentage of the

 

 

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1total work performed by the entity submitting the report, and
2the actual spending for all female-owned, minority-owned,
3veteran-owned, person with a disability-owned, and small
4business enterprises, as well as minority-led not-for-profit
5organizations, woman-led not-for-profit organizations, and
6not-for-profit organizations led by a person with a disability,
7shall also be expressed as a percentage of the total work
8performed by the entity submitting the report.
9    (c) Each participating company in its annual report shall
10include the following information:
11        (1) an explanation of the plan for the next year to
12    increase participation;
13        (2) an explanation of the plan to increase the goals;
14        (3) the areas of procurement each company shall be
15    actively seeking more participation in in the next year;
16        (4) an outline of the plan to alert and encourage
17    potential vendors in that area to seek business from the
18    company;
19        (5) an explanation of the challenges faced in finding
20    quality vendors and offer any suggestions for what the
21    Commission could do to be helpful to identify those
22    vendors;
23        (6) a list of the certifications the company
24    recognizes;
25        (7) the point of contact for any potential vendor who
26    wishes to do business with the company and explain the

 

 

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1    process for a vendor to enroll with the company as a
2    minority-owned, women-owned, or veteran-owned, or person
3    with a disability-owned company, or a minority-led
4    not-for-profit organization, a woman-led not-for-profit
5    organization, or a not-for-profit organization led by a
6    person with a disability; and
7        (8) any particular success stories to encourage other
8    companies to emulate best practices.
9    (d) Each annual report shall include as much State-specific
10data as possible. If the submitting entity does not submit
11State-specific data, then the company shall include any
12national data it does have and explain why it could not submit
13State-specific data and how it intends to do so in future
14reports, if possible.
15    (e) Each annual report shall include the rules,
16regulations, and definitions used for the procurement goals in
17the company's annual report.
18    (f) The Commission and all participating entities shall
19hold an annual workshop open to the public in 2015 and every
20year thereafter on the state of supplier diversity to
21collaboratively seek solutions to structural impediments to
22achieving stated goals, including testimony from each
23participating entity as well as subject matter experts and
24advocates. The Commission shall publish a database on its
25website of the point of contact for each participating entity
26for supplier diversity, along with a list of certifications

 

 

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1each company recognizes from the information submitted in each
2annual report. The Commission shall publish each annual report
3on its website and shall maintain each annual report for at
4least 5 years.
5(Source: P.A. 98-1056, eff. 8-26-14; 99-906, eff. 6-1-17;
6revised 7-22-19.)