HB4161 95TH GENERAL ASSEMBLY

LRB095 14190 HLH 40125 b

95TH GENERAL ASSEMBLY
State of Illinois
2007 and 2008
HB4161

Introduced , by Rep. Angelo Saviano

SYNOPSIS AS INTRODUCED:

See Index

Amends the State Finance Act to create the Regional Transportation Support Fund. Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Requires the Department of Revenue to pay into the Regional Transportation Support Fund 80%, with certain limitations, of the net revenue realized for the preceding month from the counties of Cook, DuPage, Will, Kane, Lake, and McHenry from the 6.25% rate on the selling price of motor fuel and gasohol. Amends the Regional Transportation Authority Act. Requires the Authority to provide financial oversight of the Service Boards, allocate operating and capital funds made available to support public transportation in the metropolitan region, and undertake certain planning functions. Provides that the Authority shall adopt a Strategic Plan, a Five-Year Capital Program, and an Annual Budget and Two-Year Financial Plan. Provides that the Authority shall conduct audits of each of the Service Boards no less than every 5 years, and may conduct audits of certain transportation agencies. Provides that the Authority shall establish certain Funds. Repeals certain Sections of the Act. Makes changes to the Board of the Authority and the Commuter Rail Board. Amends the Illinois Pension Code. Provides that the retirement system for Chicago Transit Authority employees shall be known as the Retirement Plan for Chicago Transit Authority Employees. Contains provisions regarding employee contributions. Contains provisions concerning the amount of retirement allowances, the normal retirement date, and early retirement. Amends the Downstate Public Transportation Act. Contains other provisions. Effective immediately.

FISCAL NOTE ACT MAY APPLY

HOUSING AFFORDABILITY IMPACT NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning local government.

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

Section 5. The Illinois State Auditing Act is amended by adding Section 3-2.3 as follows:

(30 ILCS 5/3-2.3 new)

Sec. 3-2.3. Report on Chicago Transit Authority.

(a) No less than 60 days prior to the issuance of bonds or notes by the Chicago Transit Authority (referred to as the "Authority" in this Section) pursuant to Section 12c of the Metropolitan Transit Authority Act, the following documentation shall be submitted to the Auditor General and the Regional Transportation Authority:

(1) Retirement Plan Documentation. The Authority shall submit a certification that:

(A) it is legally authorized to issue the bonds or notes;

(B) scheduled annual payments of principal and interest on the bonds and notes to be issued meet the requirements of Section 12c(b)(5) of the Metropolitan Transit Authority Act;

(C) no bond or note shall mature later than December 31, 2039; and

(D) after payment of costs of issuance and necessary deposits to funds and accounts established with respect to debt service on the bonds or notes, the net bond and note proceeds (exclusive of any proceeds to be used to refund outstanding bonds or notes) will be deposited in the Retirement Plan for Chicago Transit Authority Employees and used only for the purposes required by Section 22-101 of the Illinois Pension Code.

(2) The Board of Trustees of the Retirement Plan for Chicago Transit Authority Employees shall submit a certification that the Retirement Plan for Chicago Transit Authority Employees is operating in accordance with all applicable legal and contractual requirements, including the following:

(A) the members of a new Board of Trustees have been appointed according to the requirements of Section 22-101(b) of the Illinois Pension Code; and

(B) contribution levels for employees and the Authority have been established according to the requirements of Section 22-101(d) of the Illinois Pension Code.

(3) Actuarial Report. The Board of Trustees of the Retirement Plan for Chicago Transit Authority Employees shall submit an actuarial report prepared by an enrolled actuary setting forth:

(A) the method of valuation and the underlying assumptions;

(B) a comparison of the debt service schedules of the bonds or notes proposed to be issued to the Retirement Plan's current unfunded actuarial accrued liability amortization schedule, as required by Section 22-101(e) of the Illinois Pension Code, using the projected interest cost of the bond or note issue as the discount rate to calculate the estimated net present value savings;

(C) the amount of the estimated net present value savings comparing the true interest cost of the bonds or notes with the actuarial investment return assumption of the Retirement Plan; and

(D) a certification that the net proceeds of the bonds or notes, together with anticipated earnings on contributions and deposits, will be sufficient to reasonably conclude on an actuarial basis that the total retirement assets of the Retirement Plan will not be less than 90% of its liabilities by the end of fiscal year 2058.

(4) The Authority shall submit a financial analysis prepared by an independent advisor. The financial analysis must include a determination that the issuance of bonds is in the best interest of the Retirement Plan for Chicago Transit Authority Employees and the Chicago Transit Authority. The independent advisor shall not act as underwriter or receive a legal, consulting, or other fee related to the issuance of any bond or notes issued by the Authority pursuant to Section 12c of the Metropolitan Transit Authority Act except compensation due for the preparation of the financial analysis.

(5) Retiree Health Care Trust Documentation. The Authority shall submit a certification that:

(A) it is legally authorized to issue the bonds or notes;

(B) scheduled annual payments of principal and interest on the bonds and notes to be issued meets the requirements of Section 12c(b)(5) of the Metropolitan Transit Authority Act;

(C) no bond or note shall mature later than December 31, 2039; and

(D) after payment of costs of issuance and necessary deposits to funds and accounts established with respect to debt service on the bonds or notes, the net bond and note proceeds (exclusive of any proceeds to be used to refund outstanding bonds or notes) will be deposited in the Retiree Health Care Trust and used only for the purposes required by Section 22-101B of the Illinois Pension Code.

(6) The Board of Trustees of the Retiree Health Care Trust shall submit a certification that the Retiree Health Care Trust has been established in accordance with all applicable legal requirements, including the following:

(A) the Retiree Health Care Trust has been established and a Trust document is in effect to govern the Retiree Health Care Trust;

(B) the members of the Board of Trustees of the Retiree Health Care Trust have been appointed according to the requirements of Section 22-101B(b)(1) of the Illinois Pension Code;

(C) a health care benefit program for eligible retirees and their dependents and survivors has been established by the Board of Trustees according to the requirements of Section 22-101B(b)(2) of the Illinois Pension Code;

(D) contribution levels have been established for retirees, dependents and survivors according to the requirements of Section 22-101B(b)(5) of the Illinois Pension Code; and

(E) contribution levels have been established for employees of the Authority according to the requirements of Section 22-101B(b)(6) of the Illinois Pension Code.

(7) Actuarial Report. The Board of Trustees of the Retiree Health Care Trust shall submit an actuarial report prepared by an enrolled actuary setting forth:

(A) the method of valuation and the underlying assumptions;

(B) a comparison of the projected interest cost of the bonds or notes proposed to be issued with the actuarial investment return assumption of the Retiree Health Care Trust; and

(C) a certification that the net proceeds of the bonds or notes, together with anticipated earnings on contributions and deposits, will be sufficient to adequately fund the actuarial present value of projected benefits expected to be paid under the Retiree Health Care Trust, or a certification of the increases in contribution levels and decreases in benefit levels that would be required in order to cure any funding shortfall over a period of not more than 10 years.

(8) The Authority shall submit a financial analysis prepared by an independent advisor. The financial analysis must include a determination that the issuance of bonds is in the best interest of the Retiree Health Care Trust and the Chicago Transit Authority. The independent advisor shall not act as underwriter or receive a legal, consulting, or other fee related to the issuance of any bond or notes issued by the Authority pursuant to Section 12c of the Metropolitan Transit Authority Act except compensation due for the preparation of the financial analysis.

(b) The Auditor General shall examine the information submitted pursuant to Section 3-2.3(a)(1) through (4) and submit a report to the General Assembly, the Legislative Audit Commission, the Governor, the Regional Transportation Authority and the Authority indicating whether (i) the required certifications by the Authority and the Board of Trustees of the Retirement Plan have been made, and (ii) the actuarial reports have been provided, the reports include all required information, the assumptions underlying those reports are not unreasonable in the aggregate, and the reports appear to comply with all pertinent professional standards, including those issued by the Actuarial Standards Board. The Auditor General shall submit such report no later than 60 days after receiving the information required to be submitted by the Authority and the Board of Trustees of the Retirement Plan. Any bonds or notes issued by the Authority under item (1) of subsection (b) of Section 12c of the Metropolitan Transit Authority Act shall be issued within 120 days after receiving such report from the Auditor General. The Authority may not issue bonds or notes until it receives the report from the Auditor General indicating the above requirements have been met.

(c) The Auditor General shall examine the information submitted pursuant to Section 3-2.3(a)(5) through (8) and submit a report to the General Assembly, the Legislative Audit Commission, the Governor, the Regional Transportation Authority and the Authority indicating whether (i) the required certifications by the Authority and the Board of Trustees of the Retiree Health Care Trust have been made, and (ii) the actuarial reports have been provided, the reports include all required information, the assumptions underlying those reports are not unreasonable in the aggregate, and the reports appear to comply with all pertinent professional standards, including those issued by the Actuarial Standards Board. The Auditor General shall submit such report no later than 60 days after receiving the information required to be submitted by the Authority and the Board of Trustees of the Retiree Health Care Trust. Any bonds or notes issued by the Authority under item (2) of subsection (b) of Section 12c of the Metropolitan Transit Authority Act shall be issued within 120 days after receiving such report from the Auditor General. The Authority may not issue bonds or notes until it receives a report from the Auditor General indicating the above requirements have been met.

(d) In fulfilling this duty, after receiving the information submitted pursuant to Section 3-2.3(a), the Auditor General may request additional information and support pertaining to the data and conclusions contained in the submitted documents and the Authority, the Board of Trustees of the Retirement Plan and the Board of Trustees of the Retiree Health Care Trust shall cooperate with the Auditor General and provide additional information as requested in a timely manner. The Auditor General may also request from the Regional Transportation Authority an analysis of the information submitted by the Authority relating to the sources of funds to be utilized for payment of the proposed bonds or notes of the Authority. The Auditor General's report shall not be in the nature of a post-audit or examination and shall not lead to the issuance of an opinion as that term is defined in generally accepted government auditing standards.

(e) Annual Retirement Plan Submission to Auditor General. The Board of Trustees of the Retirement Plan for Chicago Transit Authority Employees established by Section 22-101 of the Illinois Pension Code shall provide the following documents to the Auditor General annually no later than September 30:

(1) the most recent audit or examination of the Retirement Plan;

(2) an annual statement containing the information specified in Section 1A-109 of the Illinois Pension Code; and

(3) a complete actuarial statement applicable to the prior plan year, which may be the annual report of an enrolled actuary retained by the Retirement Plan specified in Section 22-101(e) of the Illinois Pension Code.

The Auditor General shall annually examine the information provided pursuant to this subsection and shall submit a report of the analysis thereof to the General Assembly, including the report specified in Section 22-101(e) of the Illinois Pension Code.

(f) The Auditor General shall annually examine the information submitted pursuant to Section 22-101B(b)(3)(iii) of the Illinois Pension Code and shall prepare the determination specified in Section 22-101B(b)(3)(iv) of the Illinois Pension Code.

(g) In fulfilling the duties under Sections 3-2.3(e) and (f) the Auditor General may request additional information and support pertaining to the data and conclusions contained in the submitted documents and the Authority, the Board of Trustees of the Retirement Plan and the Board of Trustees of the Retiree Health Care Trust shall cooperate with the Auditor General and provide additional information as requested in a timely manner. The Auditor General's review shall not be in the nature of a post-audit or examination and shall not lead to the issuance of an opinion as that term is defined in generally accepted government auditing standards. Upon request of the Auditor General, the Commission on Government Forecasting and Accountability and the Public Pension Division of the Illinois Department of Financial and Professional Regulation shall cooperate with and assist the Auditor General in the conduct of his review.

(h) The Auditor General shall submit a bill to the Authority for costs associated with the examinations and reports specified in subsections (b) and (c) of this Section 3-2.3, which the Authority shall reimburse in a timely manner. The costs associated with the examinations and reports which are reimbursed by the Authority shall constitute a cost of issuance of the bonds or notes under Section 12c(b)(1) and (2) of the Metropolitan Transit Authority Act. The amount received shall be deposited into the fund or funds from which such costs were paid by the Auditor General. The Auditor General shall submit a bill to the Retirement Plan for Chicago Transit Authority Employees for costs associated with the examinations and reports specified in subsection (e) of this Section, which the Retirement Plan for Chicago Transit Authority Employees shall reimburse in a timely manner. The amount received shall be deposited into the fund or funds from which such costs were paid by the Auditor General. The Auditor General shall submit a bill to the Retiree Health Care Trust for costs associated with the determination specified in subsection (f) of this Section, which the Retiree Health Care Trust shall reimburse in a timely manner. The amount received shall be deposited into the fund or funds from which such costs were paid by the Auditor General.

Section 10. The State Finance Act is amended by adding Sections 5.675, 5.676, and 6z-69 as follows:

(30 ILCS 105/5.675 new)

Sec. 5.675. The Downstate Transit Improvement Fund.

(30 ILCS 105/5.676 new)

Sec. 5.676. The Regional Transportation Support Fund.

(30 ILCS 105/6z-69 new)

Sec. 6z-69. The Regional Transportation Support Fund. The Regional Transportation Support Fund is created as a special fund in the State treasury. Moneys in the Fund must be used for regional-transportation purposes, and must be disbursed as follows:

(1) $100,000,000 shall be distributed annually to the Regional Transportation Authority for deposit into the ADA Paratransit Fund established by the Authority under Section 2.01d of the Regional Transportation Authority Act;

(2) $10,000,000 shall be distributed annually to the Regional Transportation Authority for deposit into the Innovation, Coordination, and Enhancement Fund established by the Authority under Section 2.01c of the Regional Transportation Authority Act;

(3) $20,000,000 shall be distributed annually to the Regional Transportation Authority for deposit into the Suburban Community Mobility Fund established by Authority under Section 2.01e of the Regional Transportation Authority Act;

(4) $100,000,000 shall be distributed annually to the Chicago Transit Authority during each calendar year from 2009 through 2039; and

(5) Any funds remaining in the Regional Transportation Support Fund after the above distributions have been made shall be disbursed as follows: (i) 48% to the Chicago Transit Authority; (ii) 39% to the Commuter Rail Division; and (iii) 13% to the Suburban Bus Division.

Moneys received for the purposes of this Section must be deposited into the Fund. Any interest earned on moneys in the Fund must be deposited into the Fund.

Section 15. The Downstate Public Transportation Act is amended by changing Sections 2-2.04, 2-3, 2-7, and 2-15 as follows:

(30 ILCS 740/2-2.04) (from Ch. 111 2/3, par. 662.04)

Sec. 2-2.04. "Eligible operating expenses" means all expenses required for public transportation, including employee wages and benefits, materials, fuels, supplies, rental of facilities, taxes other than income taxes, payment made for debt service (including principal and interest) on publicly owned equipment or facilities, and any other expenditure which is an operating expense according to standard accounting practices for the providing of public transportation. Eligible operating expenses shall not include allowances: (a) for depreciation whether funded or unfunded; (b) for amortization of any intangible costs; (c) for debt service on capital acquired with the assistance of capital grant funds provided by the State of Illinois; (d) for profits or return on investment; (e) for excessive payment to associated entities; (f) for Comprehensive Employment Training Act expenses; (g) for costs reimbursed under Sections 6 and 8 of the "Urban Mass Transportation Act of 1964", as amended; (h) for entertainment expenses; (i) for charter expenses; (j) for fines and penalties; (k) for charitable donations; (l) for interest expense on long term borrowing and debt retirement other than on publicly owned equipment or facilities; (m) for income taxes; or (n) for such other expenses as the Department may determine consistent with federal Department of Transportation regulations or requirements. In consultation with participants, the Department shall, by October 2008, promulgate or update rules, pursuant to the Illinois Administrative Procedure Act, concerning eligible expenses to ensure consistent application of the Act, and the Department shall provide written copies of those rules to all eligible recipients. The Department shall review this process in the same manner no less frequently than every 5 years.

With respect to participants other than any Metro-East Transit District participant and those receiving federal research development and demonstration funds pursuant to Section 6 of the "Urban Mass Transportation Act of 1964", as amended, during the fiscal year ending June 30, 1979, the maximum eligible operating expenses for any such participant in any fiscal year after Fiscal Year 1980 shall be the amount appropriated for such participant for the fiscal year ending June 30, 1980, plus in each year a 10% increase over the maximum established for the preceding fiscal year. For Fiscal Year 1980 the maximum eligible operating expenses for any such participant shall be the amount of projected operating expenses upon which the appropriation for such participant for Fiscal Year 1980 is based.

With respect to participants receiving federal research development and demonstration operating assistance funds for operating assistance pursuant to Section 6 of the "Urban Mass Transportation Act of 1964", as amended, during the fiscal year ending June 30, 1979, the maximum eligible operating expenses for any such participant in any fiscal year after Fiscal Year 1980 shall not exceed such participant's eligible operating expenses for the fiscal year ending June 30, 1980, plus in each year a 10% increase over the maximum established for the preceding fiscal year. For Fiscal Year 1980, the maximum eligible operating expenses for any such participant shall be the eligible operating expenses incurred during such fiscal year, or projected operating expenses upon which the appropriation for such participant for the Fiscal Year 1980 is based; whichever is less.

With respect to all participants other than any Metro-East Transit District participant, the maximum eligible operating expenses for any such participant in any fiscal year after Fiscal Year 1985 (except Fiscal Year 2008 and Fiscal Year 2009) shall be the amount appropriated for such participant for the fiscal year ending June 30, 1985, plus in each year a 10% increase over the maximum established for the preceding year. For Fiscal Year 1985, the maximum eligible operating expenses for any such participant shall be the amount of projected operating expenses upon which the appropriation for such participant for Fiscal Year 1985 is based.

With respect to any mass transit district participant that has increased its district boundaries by annexing counties since 1998 and is maintaining a level of local financial support, including all income and revenues, equal to or greater than the level in the State fiscal year ending June 30, 2001, the maximum eligible operating expenses for any State fiscal year after 2002 (except State fiscal years year 2006 through 2009) shall be the amount appropriated for that participant for the State fiscal year ending June 30, 2002, plus, in each State fiscal year, a 10% increase over the preceding State fiscal year. For State fiscal year 2002, the maximum eligible operating expenses for any such participant shall be the amount of projected operating expenses upon which the appropriation for that participant for State fiscal year 2002 is based. For that participant, eligible operating expenses for State fiscal year 2002 in excess of the eligible operating expenses for the State fiscal year ending June 30, 2001, plus 10%, must be attributed to the provision of services in the newly annexed counties.

With respect to a participant that receives an initial appropriation in State fiscal year 2002 or thereafter, the maximum eligible operating expenses for any State fiscal year after 2003 (except State fiscal years year 2006 through 2009) shall be the amount appropriated for that participant for the State fiscal year in which it received its initial appropriation, plus, in each year, a 10% increase over the preceding year. For the initial State fiscal year in which a participant received an appropriation, the maximum eligible operating expenses for any such participant shall be the amount of projected operating expenses upon which the appropriation for that participant for that State fiscal year is based.

With respect to the District serving primarily the counties of Monroe and St. Clair, beginning July 1, 2005, the St. Clair County Transit District shall no longer be included for new appropriation funding purposes as part of the Metro-East Public Transportation Fund and instead shall be included for new appropriation funding purposes as part of the Downstate Public Transportation Fund; provided, however, that nothing herein shall alter the eligibility of that District for previously appropriated funds to which it would otherwise be entitled.

With respect to the fiscal year beginning July 1, 2007, and thereafter, the following shall be included for new appropriation funding purposes as part of the Downstate Public Transportation Fund: Bond County; Bureau County; Coles County; Edgar County; Stephenson County and the City of Freeport; Henry County; Jo Daviess County; Kankakee and McLean Counties; Peoria County; Piatt County; Shelby County; Tazewell and Woodford Counties; Vermillion County; Williamson County; and Kendall County.

(Source: P.A. 94-70, eff. 6-22-05.)

(30 ILCS 740/2-3) (from Ch. 111 2/3, par. 663)

Sec. 2-3. (a) As soon as possible after the first day of each month, beginning July 1, 1984, upon certification of the Department of Revenue, the Comptroller shall order transferred, and the Treasurer shall transfer, from the General Revenue Fund to a special fund in the State Treasury which is hereby created, to be known as the "Downstate Public Transportation Fund", an amount equal to 2/32 (beginning July 1, 2005, 3/32) of the net revenue realized from the "Retailers' Occupation Tax Act", as now or hereafter amended, the "Service Occupation Tax Act", as now or hereafter amended, the "Use Tax Act", as now or hereafter amended, and the "Service Use Tax Act", as now or hereafter amended, from persons incurring municipal or county retailers' or service occupation tax liability for the benefit of any municipality or county located wholly within the boundaries of each participant other than any Metro-East Transit District participant certified pursuant to subsection (c) of this Section during the preceding month, except that the Department shall pay into the Downstate Public Transportation Fund 2/32 (beginning July 1, 2005, 3/32) of 80% of the net revenue realized under the State tax Acts named above within any municipality or county located wholly within the boundaries of each participant, other than any Metro-East participant, for tax periods beginning on or after January 1, 1990; provided, however, that beginning with fiscal year 1985, the transfers into the Downstate Public Transportation Fund during any fiscal year shall not exceed the annual appropriation from the Downstate Public Transportation Fund for that year. The Department of Transportation shall notify the Department of Revenue and the Comptroller at the beginning of each fiscal year of the amount of the annual appropriation from the Downstate Public Transportation Fund. Net revenue realized for a month shall be the revenue collected by the State pursuant to such Acts during the previous month from persons incurring municipal or county retailers' or service occupation tax liability for the benefit of any municipality or county located wholly within the boundaries of a participant, less the amount paid out during that same month as refunds or credit memoranda to taxpayers for overpayment of liability under such Acts for the benefit of any municipality or county located wholly within the boundaries of a participant.

(b) As soon as possible after the first day of each month, beginning July 1, 1989, upon certification of the Department of Revenue, the Comptroller shall order transferred, and the Treasurer shall transfer, from the General Revenue Fund to a special fund in the State Treasury which is hereby created, to be known as the "Metro-East Public Transportation Fund", an amount equal to 2/32 of the net revenue realized, as above, from within the boundaries of Madison, Monroe, and St. Clair Counties, except that the Department shall pay into the Metro-East Public Transportation Fund 2/32 of 80% of the net revenue realized under the State tax Acts specified in subsection (a) of this Section within the boundaries of Madison, Monroe and St. Clair Counties for tax periods beginning on or after January 1, 1990. A local match equivalent to an amount which could be raised by a tax levy at the rate of .05% on the assessed value of property within the boundaries of Madison County is required annually to cause a total of 2/32 of the net revenue to be deposited in the Metro-East Public Transportation Fund. Failure to raise the required local match annually shall result in only 1/32 being deposited into the Metro-East Public Transportation Fund after July 1, 1989, or 1/32 of 80% of the net revenue realized for tax periods beginning on or after January 1, 1990.

(b-5) As soon as possible after the first day of each month, beginning July 1, 2005, upon certification of the Department of Revenue, the Comptroller shall order transferred, and the Treasurer shall transfer, from the General Revenue Fund to the Downstate Public Transportation Fund, an amount equal to 3/32 of 80% of the net revenue realized from within the boundaries of Monroe and St. Clair Counties under the State Tax Acts specified in subsection (a) of this Section and provided further that, beginning July 1, 2005, the provisions of subsection (b) shall no longer apply with respect to such tax receipts from Monroe and St. Clair Counties.

(b-6) As soon as possible after the first day of each month, beginning in fiscal year 2009, upon certification of the Department of Revenue, the Comptroller shall order transferred, and the Treasurer shall transfer, from the General Revenue Fund to the Metro-East Public Transportation Fund, an amount equal to 3/32 of 80% of the net revenue realized from within the boundaries of Madison County under the State Tax Acts specified in subsection (a) of this Section.

(c) The Department shall certify to the Department of Revenue the eligible participants under this Article and the territorial boundaries of such participants for the purposes of the Department of Revenue in subsections (a) and (b) of this Section.

(d) For the purposes of this Article the Department shall include in its annual request for appropriation of ordinary and contingent expenses an amount equal to the sum total funds projected to be paid to the participants pursuant to Section 2-7.

(e) In addition to any other permitted use of moneys in the Fund, and notwithstanding any restriction on the use of the Fund, moneys in the Downstate Public Transportation Fund may be transferred to the General Revenue Fund as authorized by Public Act 87-14. The General Assembly finds that an excess of moneys existed in the Fund on July 30, 1991, and the Governor's order of July 30, 1991, and the Governor's order of July 30, 1991, requesting the Comptroller and Treasurer to transfer an amount from the Fund to the General Revenue Fund is hereby validated.

(Source: P.A. 94-70, eff. 6-22-05.)

(30 ILCS 740/2-7) (from Ch. 111 2/3, par. 667)

Sec. 2-7. Quarterly reports; annual audit.

(a) Any Metro-East Transit District participant shall, no later than 60 days following the end of each quarter of any fiscal year, file with the Department on forms provided by the Department for that purpose, a report of the actual operating deficit experienced during that quarter. The Department shall, upon receipt of the quarterly report, determine whether the operating deficits were incurred in conformity with the program of proposed expenditures approved by the Department pursuant to Section 2-11. Any Metro-East District may either monthly or quarterly for any fiscal year file a request for the participant's eligible share, as allocated in accordance with Section 2-6, of the amounts transferred into the Metro-East Public Transportation Fund.

(b) Each participant other than any Metro-East Transit District participant shall, 30 days before the end of each quarter, file with the Department on forms provided by the Department for such purposes a report of the projected eligible operating expenses to be incurred in the next quarter and 30 days before the third and fourth quarters of any fiscal year a statement of actual eligible operating expenses incurred in the preceding quarters. Except as otherwise provided in subsection (b-5), within 45 days of receipt by the Department of such quarterly report, the Comptroller shall order paid and the Treasurer shall pay from the Downstate Public Transportation Fund to each participant an amount equal to one-third of such participant's eligible operating expenses; provided, however, that in Fiscal Year 1997, the amount paid to each participant from the Downstate Public Transportation Fund shall be an amount equal to 47% of such participant's eligible operating expenses and shall be increased to 49% in Fiscal Year 1998, 51% in Fiscal Year 1999, 53% in Fiscal Year 2000, and 55% in Fiscal Years Year 2001 through 2007, 65% in Fiscal Year 2008, and 70% in Fiscal Year 2009 and thereafter; however, in any year that a participant receives funding under subsection (i) of Section 2705-305 of the Department of Transportation Law (20 ILCS 2705/2705-305), that participant shall be eligible only for assistance equal to the following percentage of its eligible operating expenses: 42% in Fiscal Year 1997, 44% in Fiscal Year 1998, 46% in Fiscal Year 1999, 48% in Fiscal Year 2000, and 50% in Fiscal Year 2001 and thereafter. Any such payment for the third and fourth quarters of any fiscal year shall be adjusted to reflect actual eligible operating expenses for preceding quarters of such fiscal year. However, no participant shall receive an amount less than that which was received in the immediate prior year, provided in the event of a shortfall in the fund those participants receiving less than their full allocation pursuant to Section 2-6 of this Article shall be the first participants to receive an amount not less than that received in the immediate prior year.

(b-5) (Blank.) With respect to the District serving primarily the counties of Monroe and St. Clair, beginning July 1, 2005 and each fiscal year thereafter, the District may, as an alternative to the provisions of subsection (b) of Section 2-7, file a request with the Department for a monthly payment of 1/12 of the amount appropriated to the District for that fiscal year; except that, for the final month of the fiscal year, the District's request shall be in an amount such that the total payments made to the District in that fiscal year do not exceed the lesser of (i) 55% of the District's eligible operating expenses for that fiscal year or (ii) the total amount appropriated to the District for that fiscal year.

(b-10) On July 1, 2009, each participant shall receive an appropriation in an amount equal to 70% of its fiscal year 2008 eligible operating expenses adjusted by the annual 10% increase required by Section 2-2.04 of this Act. In no case shall any participant receive an appropriation that is less than its fiscal year 2008 appropriation. Every fiscal year thereafter, each participant's appropriation shall increase by 10% over the appropriation established for the preceding fiscal year as required by Section 2-2.04 of this Act.

(b-15) Beginning on July 1, 2007, and for each fiscal year thereafter, each participant shall maintain a minimum local share contribution (from farebox and all other local revenues) equal to the actual amount provided in Fiscal Year 2006 or, for new recipients, an amount equivalent to the local share provided in the first year of participation.

(b-20) Any participant in the Downstate Public Transportation Fund may use State operating assistance pursuant to this Section to provide transportation services within any county that is contiguous to its territorial boundaries as defined by the Department and subject to Departmental approval. Any such contiguous-area service provided by a participant after July 1, 2007 must meet the requirements of subsection (a) of Section 2-5.1.

(c) No later than 180 days following the last day of the Fiscal Year each participant shall provide the Department with an audit prepared by a Certified Public Accountant covering that Fiscal Year. For those participants other than a Metro-East Transit District, any discrepancy between the grants paid and the percentage of the eligible operating expenses provided for by paragraph (b) of this Section shall be reconciled by appropriate payment or credit. In the case of any Metro-East Transit District, any amount of payments from the Metro-East Public Transportation Fund which exceed the eligible deficit of the participant shall be reconciled by appropriate payment or credit.

(Source: P.A. 94-70, eff. 6-22-05.)

(30 ILCS 740/2-15) (from Ch. 111 2/3, par. 675.1)

Sec. 2-15. Except as otherwise provided in this Section, all funds which remain in the Downstate Public Transportation Fund or the Metro-East Public Transportation Fund after the payment of the fourth quarterly payment to participants other than Metro-East Transit District participants and the last monthly payment to Metro-East Transit participants in each fiscal year shall be transferred (i) to the General Revenue Fund through fiscal year 2008 and (ii) to the Downstate Transit Improvement Fund for fiscal year 2009 and each fiscal year thereafter. Transfers shall be made no later than 90 days following the end of such fiscal year. Beginning fiscal year 2010, all moneys each year in the Downstate Transit Improvement Fund, held solely for the benefit of the participants in the Downstate Public Transportation Fund and the Metro-East Transit Fund, shall be appropriated to the Department to make competitive capital grants to the participants of the respective funds. However, such amount as the Department determines to be necessary for (1) allocation to participants for the purposes of Section 2-7 for the first quarter of the succeeding fiscal year and (2) an amount equal to 2% of the total allocations to participants in the fiscal year just ended to be used for the purpose of audit adjustments shall be retained in such Funds to be used by the Department for such purposes.

(Source: P.A. 86-590.)

Section 20. The Use Tax Act is amended by changing Section 9 as follows:

(35 ILCS 105/9) (from Ch. 120, par. 439.9)

Sec. 9. Except as to motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, each retailer required or authorized to collect the tax imposed by this Act shall pay to the Department the amount of such tax (except as otherwise provided) at the time when he is required to file his return for the period during which such tax was collected, less a discount of 2.1% prior to January 1, 1990, and 1.75% on and after January 1, 1990, or $5 per calendar year, whichever is greater, which is allowed to reimburse the retailer for expenses incurred in collecting the tax, keeping records, preparing and filing returns, remitting the tax and supplying data to the Department on request. In the case of retailers who report and pay the tax on a transaction by transaction basis, as provided in this Section, such discount shall be taken with each such tax remittance instead of when such retailer files his periodic return. A retailer need not remit that part of any tax collected by him to the extent that he is required to remit and does remit the tax imposed by the Retailers' Occupation Tax Act, with respect to the sale of the same property.

Where such tangible personal property is sold under a conditional sales contract, or under any other form of sale wherein the payment of the principal sum, or a part thereof, is extended beyond the close of the period for which the return is filed, the retailer, in collecting the tax (except as to motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State), may collect for each tax return period, only the tax applicable to that part of the selling price actually received during such tax return period.

Except as provided in this Section, on or before the twentieth day of each calendar month, such retailer shall file a return for the preceding calendar month. Such return shall be filed on forms prescribed by the Department and shall furnish such information as the Department may reasonably require.

The Department may require returns to be filed on a quarterly basis. If so required, a return for each calendar quarter shall be filed on or before the twentieth day of the calendar month following the end of such calendar quarter. The taxpayer shall also file a return with the Department for each of the first two months of each calendar quarter, on or before the twentieth day of the following calendar month, stating:

1. The name of the seller;

2. The address of the principal place of business from which he engages in the business of selling tangible personal property at retail in this State;

3. The total amount of taxable receipts received by him during the preceding calendar month from sales of tangible personal property by him during such preceding calendar month, including receipts from charge and time sales, but less all deductions allowed by law;

4. The amount of credit provided in Section 2d of this Act;

5. The amount of tax due;

5-5. The signature of the taxpayer; and

6. Such other reasonable information as the Department may require.

If a taxpayer fails to sign a return within 30 days after the proper notice and demand for signature by the Department, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed.

Beginning October 1, 1993, a taxpayer who has an average monthly tax liability of $150,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1994, a taxpayer who has an average monthly tax liability of $100,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1995, a taxpayer who has an average monthly tax liability of $50,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 2000, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments required by rules of the Department by electronic funds transfer. The term "annual tax liability" shall be the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year. The term "average monthly tax liability" means the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year divided by 12. Beginning on October 1, 2002, a taxpayer who has a tax liability in the amount set forth in subsection (b) of Section 2505-210 of the Department of Revenue Law shall make all payments required by rules of the Department by electronic funds transfer.

Before August 1 of each year beginning in 1993, the Department shall notify all taxpayers required to make payments by electronic funds transfer. All taxpayers required to make payments by electronic funds transfer shall make those payments for a minimum of one year beginning on October 1.

Any taxpayer not required to make payments by electronic funds transfer may make payments by electronic funds transfer with the permission of the Department.

All taxpayers required to make payment by electronic funds transfer and any taxpayers authorized to voluntarily make payments by electronic funds transfer shall make those payments in the manner authorized by the Department.

The Department shall adopt such rules as are necessary to effectuate a program of electronic funds transfer and the requirements of this Section.

Before October 1, 2000, if the taxpayer's average monthly tax liability to the Department under this Act, the Retailers' Occupation Tax Act, the Service Occupation Tax Act, the Service Use Tax Act was $10,000 or more during the preceding 4 complete calendar quarters, he shall file a return with the Department each month by the 20th day of the month next following the month during which such tax liability is incurred and shall make payments to the Department on or before the 7th, 15th, 22nd and last day of the month during which such liability is incurred. On and after October 1, 2000, if the taxpayer's average monthly tax liability to the Department under this Act, the Retailers' Occupation Tax Act, the Service Occupation Tax Act, and the Service Use Tax Act was $20,000 or more during the preceding 4 complete calendar quarters, he shall file a return with the Department each month by the 20th day of the month next following the month during which such tax liability is incurred and shall make payment to the Department on or before the 7th, 15th, 22nd and last day of the month during which such liability is incurred. If the month during which such tax liability is incurred began prior to January 1, 1985, each payment shall be in an amount equal to 1/4 of the taxpayer's actual liability for the month or an amount set by the Department not to exceed 1/4 of the average monthly liability of the taxpayer to the Department for the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability in such 4 quarter period). If the month during which such tax liability is incurred begins on or after January 1, 1985, and prior to January 1, 1987, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 27.5% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1987, and prior to January 1, 1988, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 26.25% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1988, and prior to January 1, 1989, or begins on or after January 1, 1996, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1989, and prior to January 1, 1996, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year or 100% of the taxpayer's actual liability for the quarter monthly reporting period. The amount of such quarter monthly payments shall be credited against the final tax liability of the taxpayer's return for that month. Before October 1, 2000, once applicable, the requirement of the making of quarter monthly payments to the Department shall continue until such taxpayer's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $9,000, or until such taxpayer's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarter period is less than $10,000. However, if a taxpayer can show the Department that a substantial change in the taxpayer's business has occurred which causes the taxpayer to anticipate that his average monthly tax liability for the reasonably foreseeable future will fall below the $10,000 threshold stated above, then such taxpayer may petition the Department for change in such taxpayer's reporting status. On and after October 1, 2000, once applicable, the requirement of the making of quarter monthly payments to the Department shall continue until such taxpayer's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $19,000 or until such taxpayer's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarter period is less than $20,000. However, if a taxpayer can show the Department that a substantial change in the taxpayer's business has occurred which causes the taxpayer to anticipate that his average monthly tax liability for the reasonably foreseeable future will fall below the $20,000 threshold stated above, then such taxpayer may petition the Department for a change in such taxpayer's reporting status. The Department shall change such taxpayer's reporting status unless it finds that such change is seasonal in nature and not likely to be long term. If any such quarter monthly payment is not paid at the time or in the amount required by this Section, then the taxpayer shall be liable for penalties and interest on the difference between the minimum amount due and the amount of such quarter monthly payment actually and timely paid, except insofar as the taxpayer has previously made payments for that month to the Department in excess of the minimum payments previously due as provided in this Section. The Department shall make reasonable rules and regulations to govern the quarter monthly payment amount and quarter monthly payment dates for taxpayers who file on other than a calendar monthly basis.

If any such payment provided for in this Section exceeds the taxpayer's liabilities under this Act, the Retailers' Occupation Tax Act, the Service Occupation Tax Act and the Service Use Tax Act, as shown by an original monthly return, the Department shall issue to the taxpayer a credit memorandum no later than 30 days after the date of payment, which memorandum may be submitted by the taxpayer to the Department in payment of tax liability subsequently to be remitted by the taxpayer to the Department or be assigned by the taxpayer to a similar taxpayer under this Act, the Retailers' Occupation Tax Act, the Service Occupation Tax Act or the Service Use Tax Act, in accordance with reasonable rules and regulations to be prescribed by the Department, except that if such excess payment is shown on an original monthly return and is made after December 31, 1986, no credit memorandum shall be issued, unless requested by the taxpayer. If no such request is made, the taxpayer may credit such excess payment against tax liability subsequently to be remitted by the taxpayer to the Department under this Act, the Retailers' Occupation Tax Act, the Service Occupation Tax Act or the Service Use Tax Act, in accordance with reasonable rules and regulations prescribed by the Department. If the Department subsequently determines that all or any part of the credit taken was not actually due to the taxpayer, the taxpayer's 2.1% or 1.75% vendor's discount shall be reduced by 2.1% or 1.75% of the difference between the credit taken and that actually due, and the taxpayer shall be liable for penalties and interest on such difference.

If the retailer is otherwise required to file a monthly return and if the retailer's average monthly tax liability to the Department does not exceed $200, the Department may authorize his returns to be filed on a quarter annual basis, with the return for January, February, and March of a given year being due by April 20 of such year; with the return for April, May and June of a given year being due by July 20 of such year; with the return for July, August and September of a given year being due by October 20 of such year, and with the return for October, November and December of a given year being due by January 20 of the following year.

If the retailer is otherwise required to file a monthly or quarterly return and if the retailer's average monthly tax liability to the Department does not exceed $50, the Department may authorize his returns to be filed on an annual basis, with the return for a given year being due by January 20 of the following year.

Such quarter annual and annual returns, as to form and substance, shall be subject to the same requirements as monthly returns.

Notwithstanding any other provision in this Act concerning the time within which a retailer may file his return, in the case of any retailer who ceases to engage in a kind of business which makes him responsible for filing returns under this Act, such retailer shall file a final return under this Act with the Department not more than one month after discontinuing such business.

In addition, with respect to motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, every retailer selling this kind of tangible personal property shall file, with the Department, upon a form to be prescribed and supplied by the Department, a separate return for each such item of tangible personal property which the retailer sells, except that if, in the same transaction, (i) a retailer of aircraft, watercraft, motor vehicles or trailers transfers more than one aircraft, watercraft, motor vehicle or trailer to another aircraft, watercraft, motor vehicle or trailer retailer for the purpose of resale or (ii) a retailer of aircraft, watercraft, motor vehicles, or trailers transfers more than one aircraft, watercraft, motor vehicle, or trailer to a purchaser for use as a qualifying rolling stock as provided in Section 3-55 of this Act, then that seller may report the transfer of all the aircraft, watercraft, motor vehicles or trailers involved in that transaction to the Department on the same uniform invoice-transaction reporting return form. For purposes of this Section, "watercraft" means a Class 2, Class 3, or Class 4 watercraft as defined in Section 3-2 of the Boat Registration and Safety Act, a personal watercraft, or any boat equipped with an inboard motor.

The transaction reporting return in the case of motor vehicles or trailers that are required to be registered with an agency of this State, shall be the same document as the Uniform Invoice referred to in Section 5-402 of the Illinois Vehicle Code and must show the name and address of the seller; the name and address of the purchaser; the amount of the selling price including the amount allowed by the retailer for traded-in property, if any; the amount allowed by the retailer for the traded-in tangible personal property, if any, to the extent to which Section 2 of this Act allows an exemption for the value of traded-in property; the balance payable after deducting such trade-in allowance from the total selling price; the amount of tax due from the retailer with respect to such transaction; the amount of tax collected from the purchaser by the retailer on such transaction (or satisfactory evidence that such tax is not due in that particular instance, if that is claimed to be the fact); the place and date of the sale; a sufficient identification of the property sold; such other information as is required in Section 5-402 of the Illinois Vehicle Code, and such other information as the Department may reasonably require.

The transaction reporting return in the case of watercraft and aircraft must show the name and address of the seller; the name and address of the purchaser; the amount of the selling price including the amount allowed by the retailer for traded-in property, if any; the amount allowed by the retailer for the traded-in tangible personal property, if any, to the extent to which Section 2 of this Act allows an exemption for the value of traded-in property; the balance payable after deducting such trade-in allowance from the total selling price; the amount of tax due from the retailer with respect to such transaction; the amount of tax collected from the purchaser by the retailer on such transaction (or satisfactory evidence that such tax is not due in that particular instance, if that is claimed to be the fact); the place and date of the sale, a sufficient identification of the property sold, and such other information as the Department may reasonably require.

Such transaction reporting return shall be filed not later than 20 days after the date of delivery of the item that is being sold, but may be filed by the retailer at any time sooner than that if he chooses to do so. The transaction reporting return and tax remittance or proof of exemption from the tax that is imposed by this Act may be transmitted to the Department by way of the State agency with which, or State officer with whom, the tangible personal property must be titled or registered (if titling or registration is required) if the Department and such agency or State officer determine that this procedure will expedite the processing of applications for title or registration.

With each such transaction reporting return, the retailer shall remit the proper amount of tax due (or shall submit satisfactory evidence that the sale is not taxable if that is the case), to the Department or its agents, whereupon the Department shall issue, in the purchaser's name, a tax receipt (or a certificate of exemption if the Department is satisfied that the particular sale is tax exempt) which such purchaser may submit to the agency with which, or State officer with whom, he must title or register the tangible personal property that is involved (if titling or registration is required) in support of such purchaser's application for an Illinois certificate or other evidence of title or registration to such tangible personal property.

No retailer's failure or refusal to remit tax under this Act precludes a user, who has paid the proper tax to the retailer, from obtaining his certificate of title or other evidence of title or registration (if titling or registration is required) upon satisfying the Department that such user has paid the proper tax (if tax is due) to the retailer. The Department shall adopt appropriate rules to carry out the mandate of this paragraph.

If the user who would otherwise pay tax to the retailer wants the transaction reporting return filed and the payment of tax or proof of exemption made to the Department before the retailer is willing to take these actions and such user has not paid the tax to the retailer, such user may certify to the fact of such delay by the retailer, and may (upon the Department being satisfied of the truth of such certification) transmit the information required by the transaction reporting return and the remittance for tax or proof of exemption directly to the Department and obtain his tax receipt or exemption determination, in which event the transaction reporting return and tax remittance (if a tax payment was required) shall be credited by the Department to the proper retailer's account with the Department, but without the 2.1% or 1.75% discount provided for in this Section being allowed. When the user pays the tax directly to the Department, he shall pay the tax in the same amount and in the same form in which it would be remitted if the tax had been remitted to the Department by the retailer.

Where a retailer collects the tax with respect to the selling price of tangible personal property which he sells and the purchaser thereafter returns such tangible personal property and the retailer refunds the selling price thereof to the purchaser, such retailer shall also refund, to the purchaser, the tax so collected from the purchaser. When filing his return for the period in which he refunds such tax to the purchaser, the retailer may deduct the amount of the tax so refunded by him to the purchaser from any other use tax which such retailer may be required to pay or remit to the Department, as shown by such return, if the amount of the tax to be deducted was previously remitted to the Department by such retailer. If the retailer has not previously remitted the amount of such tax to the Department, he is entitled to no deduction under this Act upon refunding such tax to the purchaser.

Any retailer filing a return under this Section shall also include (for the purpose of paying tax thereon) the total tax covered by such return upon the selling price of tangible personal property purchased by him at retail from a retailer, but as to which the tax imposed by this Act was not collected from the retailer filing such return, and such retailer shall remit the amount of such tax to the Department when filing such return.

If experience indicates such action to be practicable, the Department may prescribe and furnish a combination or joint return which will enable retailers, who are required to file returns hereunder and also under the Retailers' Occupation Tax Act, to furnish all the return information required by both Acts on the one form.

Where the retailer has more than one business registered with the Department under separate registration under this Act, such retailer may not file each return that is due as a single return covering all such registered businesses, but shall file separate returns for each such registered business.

Beginning January 1, 1990, each month the Department shall pay into the State and Local Sales Tax Reform Fund, a special fund in the State Treasury which is hereby created, the net revenue realized for the preceding month from the 1% tax on sales of food for human consumption which is to be consumed off the premises where it is sold (other than alcoholic beverages, soft drinks and food which has been prepared for immediate consumption) and prescription and nonprescription medicines, drugs, medical appliances and insulin, urine testing materials, syringes and needles used by diabetics.

Beginning January 1, 1990, each month the Department shall pay into the County and Mass Transit District Fund 4% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property which is purchased outside Illinois at retail from a retailer and which is titled or registered by an agency of this State's government.

Beginning January 1, 1990, each month the Department shall pay into the State and Local Sales Tax Reform Fund, a special fund in the State Treasury, 20% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property, other than tangible personal property which is purchased outside Illinois at retail from a retailer and which is titled or registered by an agency of this State's government.

Beginning August 1, 2000, each month the Department shall pay into the State and Local Sales Tax Reform Fund 100% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol.

Beginning January 1, 1990, each month the Department shall pay into the Local Government Tax Fund 16% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property which is purchased outside Illinois at retail from a retailer and which is titled or registered by an agency of this State's government.

Beginning on the effective date of this amendatory Act of the 95th General Assembly, each month, the Department shall deposit the net revenue realized for the preceding month from the counties of Cook, DuPage, Will, Kane, Lake, and McHenry from the 6.25% rate on the selling price of motor fuel and gasohol as follows:

(1) to be paid into the Regional Transportation Support Fund: for each of the first 12 months, 80% of the net revenue; and, for each month thereafter, 80% of the net revenue, but not more than 105% of 1/12th of the amounts paid under this item (1) during the preceding 12-month period; and

(2) the balance must be paid into the State and Local Sales Tax Reform Fund.

Of the remainder of the moneys received by the Department pursuant to this Act, (a) 1.75% thereof shall be paid into the Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on and after July 1, 1989, 3.8% thereof shall be paid into the Build Illinois Fund; provided, however, that if in any fiscal year the sum of (1) the aggregate of 2.2% or 3.8%, as the case may be, of the moneys received by the Department and required to be paid into the Build Illinois Fund pursuant to Section 3 of the Retailers' Occupation Tax Act, Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, and Section 9 of the Service Occupation Tax Act, such Acts being hereinafter called the "Tax Acts" and such aggregate of 2.2% or 3.8%, as the case may be, of moneys being hereinafter called the "Tax Act Amount", and (2) the amount transferred to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall be less than the Annual Specified Amount (as defined in Section 3 of the Retailers' Occupation Tax Act), an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and further provided, that if on the last business day of any month the sum of (1) the Tax Act Amount required to be deposited into the Build Illinois Bond Account in the Build Illinois Fund during such month and (2) the amount transferred during such month to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall have been less than 1/12 of the Annual Specified Amount, an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and, further provided, that in no event shall the payments required under the preceding proviso result in aggregate payments into the Build Illinois Fund pursuant to this clause (b) for any fiscal year in excess of the greater of (i) the Tax Act Amount or (ii) the Annual Specified Amount for such fiscal year; and, further provided, that the amounts payable into the Build Illinois Fund under this clause (b) shall be payable only until such time as the aggregate amount on deposit under each trust indenture securing Bonds issued and outstanding pursuant to the Build Illinois Bond Act is sufficient, taking into account any future investment income, to fully provide, in accordance with such indenture, for the defeasance of or the payment of the principal of, premium, if any, and interest on the Bonds secured by such indenture and on any Bonds expected to be issued thereafter and all fees and costs payable with respect thereto, all as certified by the Director of the Bureau of the Budget (now Governor's Office of Management and Budget). If on the last business day of any month in which Bonds are outstanding pursuant to the Build Illinois Bond Act, the aggregate of the moneys deposited in the Build Illinois Bond Account in the Build Illinois Fund in such month shall be less than the amount required to be transferred in such month from the Build Illinois Bond Account to the Build Illinois Bond Retirement and Interest Fund pursuant to Section 13 of the Build Illinois Bond Act, an amount equal to such deficiency shall be immediately paid from other moneys received by the Department pursuant to the Tax Acts to the Build Illinois Fund; provided, however, that any amounts paid to the Build Illinois Fund in any fiscal year pursuant to this sentence shall be deemed to constitute payments pursuant to clause (b) of the preceding sentence and shall reduce the amount otherwise payable for such fiscal year pursuant to clause (b) of the preceding sentence. The moneys received by the Department pursuant to this Act and required to be deposited into the Build Illinois Fund are subject to the pledge, claim and charge set forth in Section 12 of the Build Illinois Bond Act.

Subject to payment of amounts into the Build Illinois Fund as provided in the preceding paragraph or in any amendment thereto hereafter enacted, the following specified monthly installment of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority provided under Section 8.25f of the State Finance Act, but not in excess of the sums designated as "Total Deposit", shall be deposited in the aggregate from collections under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act into the McCormick Place Expansion Project Fund in the specified fiscal years.

Beginning July 20, 1993 and in each month of each fiscal year thereafter, one-eighth of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority for that fiscal year, less the amount deposited into the McCormick Place Expansion Project Fund by the State Treasurer in the respective month under subsection (g) of Section 13 of the Metropolitan Pier and Exposition Authority Act, plus cumulative deficiencies in the deposits required under this Section for previous months and years, shall be deposited into the McCormick Place Expansion Project Fund, until the full amount requested for the fiscal year, but not in excess of the amount specified above as "Total Deposit", has been deposited.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning July 1, 1993, the Department shall each month pay into the Illinois Tax Increment Fund 0.27% of 80% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning with the receipt of the first report of taxes paid by an eligible business and continuing for a 25-year period, the Department shall each month pay into the Energy Infrastructure Fund 80% of the net revenue realized from the 6.25% general rate on the selling price of Illinois-mined coal that was sold to an eligible business. For purposes of this paragraph, the term "eligible business" means a new electric generating facility certified pursuant to Section 605-332 of the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois.

Of the remainder of the moneys received by the Department pursuant to this Act, 75% thereof shall be paid into the State Treasury and 25% shall be reserved in a special account and used only for the transfer to the Common School Fund as part of the monthly transfer from the General Revenue Fund in accordance with Section 8a of the State Finance Act.

As soon as possible after the first day of each month, upon certification of the Department of Revenue, the Comptroller shall order transferred and the Treasurer shall transfer from the General Revenue Fund to the Motor Fuel Tax Fund an amount equal to 1.7% of 80% of the net revenue realized under this Act for the second preceding month. Beginning April 1, 2000, this transfer is no longer required and shall not be made.

Net revenue realized for a month shall be the revenue collected by the State pursuant to this Act, less the amount paid out during that month as refunds to taxpayers for overpayment of liability.

For greater simplicity of administration, manufacturers, importers and wholesalers whose products are sold at retail in Illinois by numerous retailers, and who wish to do so, may assume the responsibility for accounting and paying to the Department all tax accruing under this Act with respect to such sales, if the retailers who are affected do not make written objection to the Department to this arrangement.

(Source: P.A. 94-793, eff. 5-19-06; 94-1074, eff. 12-26-06.)

Section 25. The Service Use Tax Act is amended by changing Section 9 as follows:

(35 ILCS 110/9) (from Ch. 120, par. 439.39)

Sec. 9. Each serviceman required or authorized to collect the tax herein imposed shall pay to the Department the amount of such tax (except as otherwise provided) at the time when he is required to file his return for the period during which such tax was collected, less a discount of 2.1% prior to January 1, 1990 and 1.75% on and after January 1, 1990, or $5 per calendar year, whichever is greater, which is allowed to reimburse the serviceman for expenses incurred in collecting the tax, keeping records, preparing and filing returns, remitting the tax and supplying data to the Department on request. A serviceman need not remit that part of any tax collected by him to the extent that he is required to pay and does pay the tax imposed by the Service Occupation Tax Act with respect to his sale of service involving the incidental transfer by him of the same property.

Except as provided hereinafter in this Section, on or before the twentieth day of each calendar month, such serviceman shall file a return for the preceding calendar month in accordance with reasonable Rules and Regulations to be promulgated by the Department. Such return shall be filed on a form prescribed by the Department and shall contain such information as the Department may reasonably require.

The Department may require returns to be filed on a quarterly basis. If so required, a return for each calendar quarter shall be filed on or before the twentieth day of the calendar month following the end of such calendar quarter. The taxpayer shall also file a return with the Department for each of the first two months of each calendar quarter, on or before the twentieth day of the following calendar month, stating:

1. The name of the seller;

2. The address of the principal place of business from which he engages in business as a serviceman in this State;

3. The total amount of taxable receipts received by him during the preceding calendar month, including receipts from charge and time sales, but less all deductions allowed by law;

4. The amount of credit provided in Section 2d of this Act;

5. The amount of tax due;

5-5. The signature of the taxpayer; and

6. Such other reasonable information as the Department may require.

If a taxpayer fails to sign a return within 30 days after the proper notice and demand for signature by the Department, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed.

Beginning October 1, 1993, a taxpayer who has an average monthly tax liability of $150,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1994, a taxpayer who has an average monthly tax liability of $100,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1995, a taxpayer who has an average monthly tax liability of $50,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 2000, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments required by rules of the Department by electronic funds transfer. The term "annual tax liability" shall be the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year. The term "average monthly tax liability" means the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year divided by 12. Beginning on October 1, 2002, a taxpayer who has a tax liability in the amount set forth in subsection (b) of Section 2505-210 of the Department of Revenue Law shall make all payments required by rules of the Department by electronic funds transfer.

Before August 1 of each year beginning in 1993, the Department shall notify all taxpayers required to make payments by electronic funds transfer. All taxpayers required to make payments by electronic funds transfer shall make those payments for a minimum of one year beginning on October 1.

Any taxpayer not required to make payments by electronic funds transfer may make payments by electronic funds transfer with the permission of the Department.

All taxpayers required to make payment by electronic funds transfer and any taxpayers authorized to voluntarily make payments by electronic funds transfer shall make those payments in the manner authorized by the Department.

The Department shall adopt such rules as are necessary to effectuate a program of electronic funds transfer and the requirements of this Section.

If the serviceman is otherwise required to file a monthly return and if the serviceman's average monthly tax liability to the Department does not exceed $200, the Department may authorize his returns to be filed on a quarter annual basis, with the return for January, February and March of a given year being due by April 20 of such year; with the return for April, May and June of a given year being due by July 20 of such year; with the return for July, August and September of a given year being due by October 20 of such year, and with the return for October, November and December of a given year being due by January 20 of the following year.

If the serviceman is otherwise required to file a monthly or quarterly return and if the serviceman's average monthly tax liability to the Department does not exceed $50, the Department may authorize his returns to be filed on an annual basis, with the return for a given year being due by January 20 of the following year.

Such quarter annual and annual returns, as to form and substance, shall be subject to the same requirements as monthly returns.

Notwithstanding any other provision in this Act concerning the time within which a serviceman may file his return, in the case of any serviceman who ceases to engage in a kind of business which makes him responsible for filing returns under this Act, such serviceman shall file a final return under this Act with the Department not more than 1 month after discontinuing such business.

Where a serviceman collects the tax with respect to the selling price of property which he sells and the purchaser thereafter returns such property and the serviceman refunds the selling price thereof to the purchaser, such serviceman shall also refund, to the purchaser, the tax so collected from the purchaser. When filing his return for the period in which he refunds such tax to the purchaser, the serviceman may deduct the amount of the tax so refunded by him to the purchaser from any other Service Use Tax, Service Occupation Tax, retailers' occupation tax or use tax which such serviceman may be required to pay or remit to the Department, as shown by such return, provided that the amount of the tax to be deducted shall previously have been remitted to the Department by such serviceman. If the serviceman shall not previously have remitted the amount of such tax to the Department, he shall be entitled to no deduction hereunder upon refunding such tax to the purchaser.

Any serviceman filing a return hereunder shall also include the total tax upon the selling price of tangible personal property purchased for use by him as an incident to a sale of service, and such serviceman shall remit the amount of such tax to the Department when filing such return.

If experience indicates such action to be practicable, the Department may prescribe and furnish a combination or joint return which will enable servicemen, who are required to file returns hereunder and also under the Service Occupation Tax Act, to furnish all the return information required by both Acts on the one form.

Where the serviceman has more than one business registered with the Department under separate registration hereunder, such serviceman shall not file each return that is due as a single return covering all such registered businesses, but shall file separate returns for each such registered business.

Beginning January 1, 1990, each month the Department shall pay into the State and Local Tax Reform Fund, a special fund in the State Treasury, the net revenue realized for the preceding month from the 1% tax on sales of food for human consumption which is to be consumed off the premises where it is sold (other than alcoholic beverages, soft drinks and food which has been prepared for immediate consumption) and prescription and nonprescription medicines, drugs, medical appliances and insulin, urine testing materials, syringes and needles used by diabetics.

Beginning January 1, 1990, each month the Department shall pay into the State and Local Sales Tax Reform Fund 20% of the net revenue realized for the preceding month from the 6.25% general rate on transfers of tangible personal property, other than tangible personal property which is purchased outside Illinois at retail from a retailer and which is titled or registered by an agency of this State's government.

Beginning August 1, 2000, each month the Department shall pay into the State and Local Sales Tax Reform Fund 100% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol.

Beginning on the effective date of this amendatory Act of the 95th General Assembly, each month, the Department shall deposit the net revenue realized for the preceding month from the counties of Cook, DuPage, Will, Kane, Lake, and McHenry from the 6.25% rate on the selling price of motor fuel and gasohol as follows:

(1) to be paid into the Regional Transportation Support Fund: for each of the first 12 months, 80% of the net revenue; and for each month thereafter, 80% of the net revenue, but not more than 105% of 1/12th of the amounts paid under this item (1) during the preceding 12-month period; and

(2) the balance must be paid into the State and Local Sales Tax Reform Fund.

Of the remainder of the moneys received by the Department pursuant to this Act, (a) 1.75% thereof shall be paid into the Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on and after July 1, 1989, 3.8% thereof shall be paid into the Build Illinois Fund; provided, however, that if in any fiscal year the sum of (1) the aggregate of 2.2% or 3.8%, as the case may be, of the moneys received by the Department and required to be paid into the Build Illinois Fund pursuant to Section 3 of the Retailers' Occupation Tax Act, Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, and Section 9 of the Service Occupation Tax Act, such Acts being hereinafter called the "Tax Acts" and such aggregate of 2.2% or 3.8%, as the case may be, of moneys being hereinafter called the "Tax Act Amount", and (2) the amount transferred to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall be less than the Annual Specified Amount (as defined in Section 3 of the Retailers' Occupation Tax Act), an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and further provided, that if on the last business day of any month the sum of (1) the Tax Act Amount required to be deposited into the Build Illinois Bond Account in the Build Illinois Fund during such month and (2) the amount transferred during such month to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall have been less than 1/12 of the Annual Specified Amount, an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and, further provided, that in no event shall the payments required under the preceding proviso result in aggregate payments into the Build Illinois Fund pursuant to this clause (b) for any fiscal year in excess of the greater of (i) the Tax Act Amount or (ii) the Annual Specified Amount for such fiscal year; and, further provided, that the amounts payable into the Build Illinois Fund under this clause (b) shall be payable only until such time as the aggregate amount on deposit under each trust indenture securing Bonds issued and outstanding pursuant to the Build Illinois Bond Act is sufficient, taking into account any future investment income, to fully provide, in accordance with such indenture, for the defeasance of or the payment of the principal of, premium, if any, and interest on the Bonds secured by such indenture and on any Bonds expected to be issued thereafter and all fees and costs payable with respect thereto, all as certified by the Director of the Bureau of the Budget (now Governor's Office of Management and Budget). If on the last business day of any month in which Bonds are outstanding pursuant to the Build Illinois Bond Act, the aggregate of the moneys deposited in the Build Illinois Bond Account in the Build Illinois Fund in such month shall be less than the amount required to be transferred in such month from the Build Illinois Bond Account to the Build Illinois Bond Retirement and Interest Fund pursuant to Section 13 of the Build Illinois Bond Act, an amount equal to such deficiency shall be immediately paid from other moneys received by the Department pursuant to the Tax Acts to the Build Illinois Fund; provided, however, that any amounts paid to the Build Illinois Fund in any fiscal year pursuant to this sentence shall be deemed to constitute payments pursuant to clause (b) of the preceding sentence and shall reduce the amount otherwise payable for such fiscal year pursuant to clause (b) of the preceding sentence. The moneys received by the Department pursuant to this Act and required to be deposited into the Build Illinois Fund are subject to the pledge, claim and charge set forth in Section 12 of the Build Illinois Bond Act.

Subject to payment of amounts into the Build Illinois Fund as provided in the preceding paragraph or in any amendment thereto hereafter enacted, the following specified monthly installment of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority provided under Section 8.25f of the State Finance Act, but not in excess of the sums designated as "Total Deposit", shall be deposited in the aggregate from collections under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act into the McCormick Place Expansion Project Fund in the specified fiscal years.

Beginning July 20, 1993 and in each month of each fiscal year thereafter, one-eighth of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority for that fiscal year, less the amount deposited into the McCormick Place Expansion Project Fund by the State Treasurer in the respective month under subsection (g) of Section 13 of the Metropolitan Pier and Exposition Authority Act, plus cumulative deficiencies in the deposits required under this Section for previous months and years, shall be deposited into the McCormick Place Expansion Project Fund, until the full amount requested for the fiscal year, but not in excess of the amount specified above as "Total Deposit", has been deposited.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning July 1, 1993, the Department shall each month pay into the Illinois Tax Increment Fund 0.27% of 80% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning with the receipt of the first report of taxes paid by an eligible business and continuing for a 25-year period, the Department shall each month pay into the Energy Infrastructure Fund 80% of the net revenue realized from the 6.25% general rate on the selling price of Illinois-mined coal that was sold to an eligible business. For purposes of this paragraph, the term "eligible business" means a new electric generating facility certified pursuant to Section 605-332 of the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois.

All remaining moneys received by the Department pursuant to this Act shall be paid into the General Revenue Fund of the State Treasury.

As soon as possible after the first day of each month, upon certification of the Department of Revenue, the Comptroller shall order transferred and the Treasurer shall transfer from the General Revenue Fund to the Motor Fuel Tax Fund an amount equal to 1.7% of 80% of the net revenue realized under this Act for the second preceding month. Beginning April 1, 2000, this transfer is no longer required and shall not be made.

Net revenue realized for a month shall be the revenue collected by the State pursuant to this Act, less the amount paid out during that month as refunds to taxpayers for overpayment of liability.

(Source: P.A. 94-793, eff. 5-19-06; 94-1074, eff. 12-26-06.)

Section 30. The Service Occupation Tax Act is amended by changing Section 9 as follows:

(35 ILCS 115/9) (from Ch. 120, par. 439.109)

Sec. 9. Each serviceman required or authorized to collect the tax herein imposed shall pay to the Department the amount of such tax at the time when he is required to file his return for the period during which such tax was collectible, less a discount of 2.1% prior to January 1, 1990, and 1.75% on and after January 1, 1990, or $5 per calendar year, whichever is greater, which is allowed to reimburse the serviceman for expenses incurred in collecting the tax, keeping records, preparing and filing returns, remitting the tax and supplying data to the Department on request.

Where such tangible personal property is sold under a conditional sales contract, or under any other form of sale wherein the payment of the principal sum, or a part thereof, is extended beyond the close of the period for which the return is filed, the serviceman, in collecting the tax may collect, for each tax return period, only the tax applicable to the part of the selling price actually received during such tax return period.

Except as provided hereinafter in this Section, on or before the twentieth day of each calendar month, such serviceman shall file a return for the preceding calendar month in accordance with reasonable rules and regulations to be promulgated by the Department of Revenue. Such return shall be filed on a form prescribed by the Department and shall contain such information as the Department may reasonably require.

The Department may require returns to be filed on a quarterly basis. If so required, a return for each calendar quarter shall be filed on or before the twentieth day of the calendar month following the end of such calendar quarter. The taxpayer shall also file a return with the Department for each of the first two months of each calendar quarter, on or before the twentieth day of the following calendar month, stating:

1. The name of the seller;

2. The address of the principal place of business from which he engages in business as a serviceman in this State;

3. The total amount of taxable receipts received by him during the preceding calendar month, including receipts from charge and time sales, but less all deductions allowed by law;

4. The amount of credit provided in Section 2d of this Act;

5. The amount of tax due;

5-5. The signature of the taxpayer; and

6. Such other reasonable information as the Department may require.

If a taxpayer fails to sign a return within 30 days after the proper notice and demand for signature by the Department, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed.

Prior to October 1, 2003, and on and after September 1, 2004 a serviceman may accept a Manufacturer's Purchase Credit certification from a purchaser in satisfaction of Service Use Tax as provided in Section 3-70 of the Service Use Tax Act if the purchaser provides the appropriate documentation as required by Section 3-70 of the Service Use Tax Act. A Manufacturer's Purchase Credit certification, accepted prior to October 1, 2003 or on or after September 1, 2004 by a serviceman as provided in Section 3-70 of the Service Use Tax Act, may be used by that serviceman to satisfy Service Occupation Tax liability in the amount claimed in the certification, not to exceed 6.25% of the receipts subject to tax from a qualifying purchase. A Manufacturer's Purchase Credit reported on any original or amended return filed under this Act after October 20, 2003 for reporting periods prior to September 1, 2004 shall be disallowed. Manufacturer's Purchase Credit reported on annual returns due on or after January 1, 2005 will be disallowed for periods prior to September 1, 2004. No Manufacturer's Purchase Credit may be used after September 30, 2003 through August 31, 2004 to satisfy any tax liability imposed under this Act, including any audit liability.

If the serviceman's average monthly tax liability to the Department does not exceed $200, the Department may authorize his returns to be filed on a quarter annual basis, with the return for January, February and March of a given year being due by April 20 of such year; with the return for April, May and June of a given year being due by July 20 of such year; with the return for July, August and September of a given year being due by October 20 of such year, and with the return for October, November and December of a given year being due by January 20 of the following year.

If the serviceman's average monthly tax liability to the Department does not exceed $50, the Department may authorize his returns to be filed on an annual basis, with the return for a given year being due by January 20 of the following year.

Such quarter annual and annual returns, as to form and substance, shall be subject to the same requirements as monthly returns.

Notwithstanding any other provision in this Act concerning the time within which a serviceman may file his return, in the case of any serviceman who ceases to engage in a kind of business which makes him responsible for filing returns under this Act, such serviceman shall file a final return under this Act with the Department not more than 1 month after discontinuing such business.

Beginning October 1, 1993, a taxpayer who has an average monthly tax liability of $150,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1994, a taxpayer who has an average monthly tax liability of $100,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1995, a taxpayer who has an average monthly tax liability of $50,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 2000, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments required by rules of the Department by electronic funds transfer. The term "annual tax liability" shall be the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year. The term "average monthly tax liability" means the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year divided by 12. Beginning on October 1, 2002, a taxpayer who has a tax liability in the amount set forth in subsection (b) of Section 2505-210 of the Department of Revenue Law shall make all payments required by rules of the Department by electronic funds transfer.

Before August 1 of each year beginning in 1993, the Department shall notify all taxpayers required to make payments by electronic funds transfer. All taxpayers required to make payments by electronic funds transfer shall make those payments for a minimum of one year beginning on October 1.

Any taxpayer not required to make payments by electronic funds transfer may make payments by electronic funds transfer with the permission of the Department.

All taxpayers required to make payment by electronic funds transfer and any taxpayers authorized to voluntarily make payments by electronic funds transfer shall make those payments in the manner authorized by the Department.

The Department shall adopt such rules as are necessary to effectuate a program of electronic funds transfer and the requirements of this Section.

Where a serviceman collects the tax with respect to the selling price of tangible personal property which he sells and the purchaser thereafter returns such tangible personal property and the serviceman refunds the selling price thereof to the purchaser, such serviceman shall also refund, to the purchaser, the tax so collected from the purchaser. When filing his return for the period in which he refunds such tax to the purchaser, the serviceman may deduct the amount of the tax so refunded by him to the purchaser from any other Service Occupation Tax, Service Use Tax, Retailers' Occupation Tax or Use Tax which such serviceman may be required to pay or remit to the Department, as shown by such return, provided that the amount of the tax to be deducted shall previously have been remitted to the Department by such serviceman. If the serviceman shall not previously have remitted the amount of such tax to the Department, he shall be entitled to no deduction hereunder upon refunding such tax to the purchaser.

If experience indicates such action to be practicable, the Department may prescribe and furnish a combination or joint return which will enable servicemen, who are required to file returns hereunder and also under the Retailers' Occupation Tax Act, the Use Tax Act or the Service Use Tax Act, to furnish all the return information required by all said Acts on the one form.

Where the serviceman has more than one business registered with the Department under separate registrations hereunder, such serviceman shall file separate returns for each registered business.

Beginning January 1, 1990, each month the Department shall pay into the Local Government Tax Fund the revenue realized for the preceding month from the 1% tax on sales of food for human consumption which is to be consumed off the premises where it is sold (other than alcoholic beverages, soft drinks and food which has been prepared for immediate consumption) and prescription and nonprescription medicines, drugs, medical appliances and insulin, urine testing materials, syringes and needles used by diabetics.

Beginning January 1, 1990, each month the Department shall pay into the County and Mass Transit District Fund 4% of the revenue realized for the preceding month from the 6.25% general rate.

Beginning August 1, 2000, each month the Department shall pay into the County and Mass Transit District Fund 20% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol.

Beginning January 1, 1990, each month the Department shall pay into the Local Government Tax Fund 16% of the revenue realized for the preceding month from the 6.25% general rate on transfers of tangible personal property.

Beginning August 1, 2000, each month the Department shall pay into the Local Government Tax Fund 80% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol.

Beginning on the effective date of this amendatory Act of the 95th General Assembly, each month, the Department shall deposit the net revenue realized for the preceding month from the counties of Cook, DuPage, Will, Kane, Lake, and McHenry from the 6.25% rate on the selling price of motor fuel and gasohol as follows:

(1) to be paid into the Regional Transportation Support Fund: for each of the first 12 months, 80% of the net revenue; and, for each month thereafter, 80% of the net revenue, but not more than 105% of 1/12th of the amounts paid under this item (1) during the preceding 12-month period;

(2) 80% of the balance must be paid into the State and Local Sales Tax Reform Fund; and

(3) 20% of the balance must be paid into the County and Mass Transit District Fund.

Of the remainder of the moneys received by the Department pursuant to this Act, (a) 1.75% thereof shall be paid into the Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on and after July 1, 1989, 3.8% thereof shall be paid into the Build Illinois Fund; provided, however, that if in any fiscal year the sum of (1) the aggregate of 2.2% or 3.8%, as the case may be, of the moneys received by the Department and required to be paid into the Build Illinois Fund pursuant to Section 3 of the Retailers' Occupation Tax Act, Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, and Section 9 of the Service Occupation Tax Act, such Acts being hereinafter called the "Tax Acts" and such aggregate of 2.2% or 3.8%, as the case may be, of moneys being hereinafter called the "Tax Act Amount", and (2) the amount transferred to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall be less than the Annual Specified Amount (as defined in Section 3 of the Retailers' Occupation Tax Act), an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and further provided, that if on the last business day of any month the sum of (1) the Tax Act Amount required to be deposited into the Build Illinois Account in the Build Illinois Fund during such month and (2) the amount transferred during such month to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall have been less than 1/12 of the Annual Specified Amount, an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and, further provided, that in no event shall the payments required under the preceding proviso result in aggregate payments into the Build Illinois Fund pursuant to this clause (b) for any fiscal year in excess of the greater of (i) the Tax Act Amount or (ii) the Annual Specified Amount for such fiscal year; and, further provided, that the amounts payable into the Build Illinois Fund under this clause (b) shall be payable only until such time as the aggregate amount on deposit under each trust indenture securing Bonds issued and outstanding pursuant to the Build Illinois Bond Act is sufficient, taking into account any future investment income, to fully provide, in accordance with such indenture, for the defeasance of or the payment of the principal of, premium, if any, and interest on the Bonds secured by such indenture and on any Bonds expected to be issued thereafter and all fees and costs payable with respect thereto, all as certified by the Director of the Bureau of the Budget (now Governor's Office of Management and Budget). If on the last business day of any month in which Bonds are outstanding pursuant to the Build Illinois Bond Act, the aggregate of the moneys deposited in the Build Illinois Bond Account in the Build Illinois Fund in such month shall be less than the amount required to be transferred in such month from the Build Illinois Bond Account to the Build Illinois Bond Retirement and Interest Fund pursuant to Section 13 of the Build Illinois Bond Act, an amount equal to such deficiency shall be immediately paid from other moneys received by the Department pursuant to the Tax Acts to the Build Illinois Fund; provided, however, that any amounts paid to the Build Illinois Fund in any fiscal year pursuant to this sentence shall be deemed to constitute payments pursuant to clause (b) of the preceding sentence and shall reduce the amount otherwise payable for such fiscal year pursuant to clause (b) of the preceding sentence. The moneys received by the Department pursuant to this Act and required to be deposited into the Build Illinois Fund are subject to the pledge, claim and charge set forth in Section 12 of the Build Illinois Bond Act.

Subject to payment of amounts into the Build Illinois Fund as provided in the preceding paragraph or in any amendment thereto hereafter enacted, the following specified monthly installment of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority provided under Section 8.25f of the State Finance Act, but not in excess of the sums designated as "Total Deposit", shall be deposited in the aggregate from collections under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act into the McCormick Place Expansion Project Fund in the specified fiscal years.

Beginning July 20, 1993 and in each month of each fiscal year thereafter, one-eighth of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority for that fiscal year, less the amount deposited into the McCormick Place Expansion Project Fund by the State Treasurer in the respective month under subsection (g) of Section 13 of the Metropolitan Pier and Exposition Authority Act, plus cumulative deficiencies in the deposits required under this Section for previous months and years, shall be deposited into the McCormick Place Expansion Project Fund, until the full amount requested for the fiscal year, but not in excess of the amount specified above as "Total Deposit", has been deposited.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning July 1, 1993, the Department shall each month pay into the Illinois Tax Increment Fund 0.27% of 80% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning with the receipt of the first report of taxes paid by an eligible business and continuing for a 25-year period, the Department shall each month pay into the Energy Infrastructure Fund 80% of the net revenue realized from the 6.25% general rate on the selling price of Illinois-mined coal that was sold to an eligible business. For purposes of this paragraph, the term "eligible business" means a new electric generating facility certified pursuant to Section 605-332 of the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois.

Remaining moneys received by the Department pursuant to this Act shall be paid into the General Revenue Fund of the State Treasury.

The Department may, upon separate written notice to a taxpayer, require the taxpayer to prepare and file with the Department on a form prescribed by the Department within not less than 60 days after receipt of the notice an annual information return for the tax year specified in the notice. Such annual return to the Department shall include a statement of gross receipts as shown by the taxpayer's last Federal income tax return. If the total receipts of the business as reported in the Federal income tax return do not agree with the gross receipts reported to the Department of Revenue for the same period, the taxpayer shall attach to his annual return a schedule showing a reconciliation of the 2 amounts and the reasons for the difference. The taxpayer's annual return to the Department shall also disclose the cost of goods sold by the taxpayer during the year covered by such return, opening and closing inventories of such goods for such year, cost of goods used from stock or taken from stock and given away by the taxpayer during such year, pay roll information of the taxpayer's business during such year and any additional reasonable information which the Department deems would be helpful in determining the accuracy of the monthly, quarterly or annual returns filed by such taxpayer as hereinbefore provided for in this Section.

If the annual information return required by this Section is not filed when and as required, the taxpayer shall be liable as follows:

(i) Until January 1, 1994, the taxpayer shall be liable for a penalty equal to 1/6 of 1% of the tax due from such taxpayer under this Act during the period to be covered by the annual return for each month or fraction of a month until such return is filed as required, the penalty to be assessed and collected in the same manner as any other penalty provided for in this Act.

(ii) On and after January 1, 1994, the taxpayer shall be liable for a penalty as described in Section 3-4 of the Uniform Penalty and Interest Act.

The chief executive officer, proprietor, owner or highest ranking manager shall sign the annual return to certify the accuracy of the information contained therein. Any person who willfully signs the annual return containing false or inaccurate information shall be guilty of perjury and punished accordingly. The annual return form prescribed by the Department shall include a warning that the person signing the return may be liable for perjury.

The foregoing portion of this Section concerning the filing of an annual information return shall not apply to a serviceman who is not required to file an income tax return with the United States Government.

As soon as possible after the first day of each month, upon certification of the Department of Revenue, the Comptroller shall order transferred and the Treasurer shall transfer from the General Revenue Fund to the Motor Fuel Tax Fund an amount equal to 1.7% of 80% of the net revenue realized under this Act for the second preceding month. Beginning April 1, 2000, this transfer is no longer required and shall not be made.

Net revenue realized for a month shall be the revenue collected by the State pursuant to this Act, less the amount paid out during that month as refunds to taxpayers for overpayment of liability.

For greater simplicity of administration, it shall be permissible for manufacturers, importers and wholesalers whose products are sold by numerous servicemen in Illinois, and who wish to do so, to assume the responsibility for accounting and paying to the Department all tax accruing under this Act with respect to such sales, if the servicemen who are affected do not make written objection to the Department to this arrangement.

(Source: P.A. 93-24, eff. 6-20-03; 93-840, eff. 7-30-04; 94-1074, eff. 12-26-06.)

Section 35. The Retailers' Occupation Tax Act is amended by changing Section 3 as follows:

(35 ILCS 120/3) (from Ch. 120, par. 442)

Sec. 3. Except as provided in this Section, on or before the twentieth day of each calendar month, every person engaged in the business of selling tangible personal property at retail in this State during the preceding calendar month shall file a return with the Department, stating:

1. The name of the seller;

2. His residence address and the address of his principal place of business and the address of the principal place of business (if that is a different address) from which he engages in the business of selling tangible personal property at retail in this State;

3. Total amount of receipts received by him during the preceding calendar month or quarter, as the case may be, from sales of tangible personal property, and from services furnished, by him during such preceding calendar month or quarter;

4. Total amount received by him during the preceding calendar month or quarter on charge and time sales of tangible personal property, and from services furnished, by him prior to the month or quarter for which the return is filed;

5. Deductions allowed by law;

6. Gross receipts which were received by him during the preceding calendar month or quarter and upon the basis of which the tax is imposed;

7. The amount of credit provided in Section 2d of this Act;

8. The amount of tax due;

9. The signature of the taxpayer; and

10. Such other reasonable information as the Department may require.

If a taxpayer fails to sign a return within 30 days after the proper notice and demand for signature by the Department, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed.

Each return shall be accompanied by the statement of prepaid tax issued pursuant to Section 2e for which credit is claimed.

Prior to October 1, 2003, and on and after September 1, 2004 a retailer may accept a Manufacturer's Purchase Credit certification from a purchaser in satisfaction of Use Tax as provided in Section 3-85 of the Use Tax Act if the purchaser provides the appropriate documentation as required by Section 3-85 of the Use Tax Act. A Manufacturer's Purchase Credit certification, accepted by a retailer prior to October 1, 2003 and on and after September 1, 2004 as provided in Section 3-85 of the Use Tax Act, may be used by that retailer to satisfy Retailers' Occupation Tax liability in the amount claimed in the certification, not to exceed 6.25% of the receipts subject to tax from a qualifying purchase. A Manufacturer's Purchase Credit reported on any original or amended return filed under this Act after October 20, 2003 for reporting periods prior to September 1, 2004 shall be disallowed. Manufacturer's Purchaser Credit reported on annual returns due on or after January 1, 2005 will be disallowed for periods prior to September 1, 2004. No Manufacturer's Purchase Credit may be used after September 30, 2003 through August 31, 2004 to satisfy any tax liability imposed under this Act, including any audit liability.

The Department may require returns to be filed on a quarterly basis. If so required, a return for each calendar quarter shall be filed on or before the twentieth day of the calendar month following the end of such calendar quarter. The taxpayer shall also file a return with the Department for each of the first two months of each calendar quarter, on or before the twentieth day of the following calendar month, stating:

1. The name of the seller;

2. The address of the principal place of business from which he engages in the business of selling tangible personal property at retail in this State;

3. The total amount of taxable receipts received by him during the preceding calendar month from sales of tangible personal property by him during such preceding calendar month, including receipts from charge and time sales, but less all deductions allowed by law;

4. The amount of credit provided in Section 2d of this Act;

5. The amount of tax due; and

6. Such other reasonable information as the Department may require.

Beginning on October 1, 2003, any person who is not a licensed distributor, importing distributor, or manufacturer, as defined in the Liquor Control Act of 1934, but is engaged in the business of selling, at retail, alcoholic liquor shall file a statement with the Department of Revenue, in a format and at a time prescribed by the Department, showing the total amount paid for alcoholic liquor purchased during the preceding month and such other information as is reasonably required by the Department. The Department may adopt rules to require that this statement be filed in an electronic or telephonic format. Such rules may provide for exceptions from the filing requirements of this paragraph. For the purposes of this paragraph, the term "alcoholic liquor" shall have the meaning prescribed in the Liquor Control Act of 1934.

Beginning on October 1, 2003, every distributor, importing distributor, and manufacturer of alcoholic liquor as defined in the Liquor Control Act of 1934, shall file a statement with the Department of Revenue, no later than the 10th day of the month for the preceding month during which transactions occurred, by electronic means, showing the total amount of gross receipts from the sale of alcoholic liquor sold or distributed during the preceding month to purchasers; identifying the purchaser to whom it was sold or distributed; the purchaser's tax registration number; and such other information reasonably required by the Department. A distributor, importing distributor, or manufacturer of alcoholic liquor must personally deliver, mail, or provide by electronic means to each retailer listed on the monthly statement a report containing a cumulative total of that distributor's, importing distributor's, or manufacturer's total sales of alcoholic liquor to that retailer no later than the 10th day of the month for the preceding month during which the transaction occurred. The distributor, importing distributor, or manufacturer shall notify the retailer as to the method by which the distributor, importing distributor, or manufacturer will provide the sales information. If the retailer is unable to receive the sales information by electronic means, the distributor, importing distributor, or manufacturer shall furnish the sales information by personal delivery or by mail. For purposes of this paragraph, the term "electronic means" includes, but is not limited to, the use of a secure Internet website, e-mail, or facsimile.

If a total amount of less than $1 is payable, refundable or creditable, such amount shall be disregarded if it is less than 50 cents and shall be increased to $1 if it is 50 cents or more.

Beginning October 1, 1993, a taxpayer who has an average monthly tax liability of $150,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1994, a taxpayer who has an average monthly tax liability of $100,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 1995, a taxpayer who has an average monthly tax liability of $50,000 or more shall make all payments required by rules of the Department by electronic funds transfer. Beginning October 1, 2000, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments required by rules of the Department by electronic funds transfer. The term "annual tax liability" shall be the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year. The term "average monthly tax liability" shall be the sum of the taxpayer's liabilities under this Act, and under all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year divided by 12. Beginning on October 1, 2002, a taxpayer who has a tax liability in the amount set forth in subsection (b) of Section 2505-210 of the Department of Revenue Law shall make all payments required by rules of the Department by electronic funds transfer.

Before August 1 of each year beginning in 1993, the Department shall notify all taxpayers required to make payments by electronic funds transfer. All taxpayers required to make payments by electronic funds transfer shall make those payments for a minimum of one year beginning on October 1.

Any taxpayer not required to make payments by electronic funds transfer may make payments by electronic funds transfer with the permission of the Department.

All taxpayers required to make payment by electronic funds transfer and any taxpayers authorized to voluntarily make payments by electronic funds transfer shall make those payments in the manner authorized by the Department.

The Department shall adopt such rules as are necessary to effectuate a program of electronic funds transfer and the requirements of this Section.

Any amount which is required to be shown or reported on any return or other document under this Act shall, if such amount is not a whole-dollar amount, be increased to the nearest whole-dollar amount in any case where the fractional part of a dollar is 50 cents or more, and decreased to the nearest whole-dollar amount where the fractional part of a dollar is less than 50 cents.

If the retailer is otherwise required to file a monthly return and if the retailer's average monthly tax liability to the Department does not exceed $200, the Department may authorize his returns to be filed on a quarter annual basis, with the return for January, February and March of a given year being due by April 20 of such year; with the return for April, May and June of a given year being due by July 20 of such year; with the return for July, August and September of a given year being due by October 20 of such year, and with the return for October, November and December of a given year being due by January 20 of the following year.

If the retailer is otherwise required to file a monthly or quarterly return and if the retailer's average monthly tax liability with the Department does not exceed $50, the Department may authorize his returns to be filed on an annual basis, with the return for a given year being due by January 20 of the following year.

Such quarter annual and annual returns, as to form and substance, shall be subject to the same requirements as monthly returns.

Notwithstanding any other provision in this Act concerning the time within which a retailer may file his return, in the case of any retailer who ceases to engage in a kind of business which makes him responsible for filing returns under this Act, such retailer shall file a final return under this Act with the Department not more than one month after discontinuing such business.

Where the same person has more than one business registered with the Department under separate registrations under this Act, such person may not file each return that is due as a single return covering all such registered businesses, but shall file separate returns for each such registered business.

In addition, with respect to motor vehicles, watercraft, aircraft, and trailers that are required to be registered with an agency of this State, every retailer selling this kind of tangible personal property shall file, with the Department, upon a form to be prescribed and supplied by the Department, a separate return for each such item of tangible personal property which the retailer sells, except that if, in the same transaction, (i) a retailer of aircraft, watercraft, motor vehicles or trailers transfers more than one aircraft, watercraft, motor vehicle or trailer to another aircraft, watercraft, motor vehicle retailer or trailer retailer for the purpose of resale or (ii) a retailer of aircraft, watercraft, motor vehicles, or trailers transfers more than one aircraft, watercraft, motor vehicle, or trailer to a purchaser for use as a qualifying rolling stock as provided in Section 2-5 of this Act, then that seller may report the transfer of all aircraft, watercraft, motor vehicles or trailers involved in that transaction to the Department on the same uniform invoice-transaction reporting return form. For purposes of this Section, "watercraft" means a Class 2, Class 3, or Class 4 watercraft as defined in Section 3-2 of the Boat Registration and Safety Act, a personal watercraft, or any boat equipped with an inboard motor.

Any retailer who sells only motor vehicles, watercraft, aircraft, or trailers that are required to be registered with an agency of this State, so that all retailers' occupation tax liability is required to be reported, and is reported, on such transaction reporting returns and who is not otherwise required to file monthly or quarterly returns, need not file monthly or quarterly returns. However, those retailers shall be required to file returns on an annual basis.

The transaction reporting return, in the case of motor vehicles or trailers that are required to be registered with an agency of this State, shall be the same document as the Uniform Invoice referred to in Section 5-402 of The Illinois Vehicle Code and must show the name and address of the seller; the name and address of the purchaser; the amount of the selling price including the amount allowed by the retailer for traded-in property, if any; the amount allowed by the retailer for the traded-in tangible personal property, if any, to the extent to which Section 1 of this Act allows an exemption for the value of traded-in property; the balance payable after deducting such trade-in allowance from the total selling price; the amount of tax due from the retailer with respect to such transaction; the amount of tax collected from the purchaser by the retailer on such transaction (or satisfactory evidence that such tax is not due in that particular instance, if that is claimed to be the fact); the place and date of the sale; a sufficient identification of the property sold; such other information as is required in Section 5-402 of The Illinois Vehicle Code, and such other information as the Department may reasonably require.

The transaction reporting return in the case of watercraft or aircraft must show the name and address of the seller; the name and address of the purchaser; the amount of the selling price including the amount allowed by the retailer for traded-in property, if any; the amount allowed by the retailer for the traded-in tangible personal property, if any, to the extent to which Section 1 of this Act allows an exemption for the value of traded-in property; the balance payable after deducting such trade-in allowance from the total selling price; the amount of tax due from the retailer with respect to such transaction; the amount of tax collected from the purchaser by the retailer on such transaction (or satisfactory evidence that such tax is not due in that particular instance, if that is claimed to be the fact); the place and date of the sale, a sufficient identification of the property sold, and such other information as the Department may reasonably require.

Such transaction reporting return shall be filed not later than 20 days after the day of delivery of the item that is being sold, but may be filed by the retailer at any time sooner than that if he chooses to do so. The transaction reporting return and tax remittance or proof of exemption from the Illinois use tax may be transmitted to the Department by way of the State agency with which, or State officer with whom the tangible personal property must be titled or registered (if titling or registration is required) if the Department and such agency or State officer determine that this procedure will expedite the processing of applications for title or registration.

With each such transaction reporting return, the retailer shall remit the proper amount of tax due (or shall submit satisfactory evidence that the sale is not taxable if that is the case), to the Department or its agents, whereupon the Department shall issue, in the purchaser's name, a use tax receipt (or a certificate of exemption if the Department is satisfied that the particular sale is tax exempt) which such purchaser may submit to the agency with which, or State officer with whom, he must title or register the tangible personal property that is involved (if titling or registration is required) in support of such purchaser's application for an Illinois certificate or other evidence of title or registration to such tangible personal property.

No retailer's failure or refusal to remit tax under this Act precludes a user, who has paid the proper tax to the retailer, from obtaining his certificate of title or other evidence of title or registration (if titling or registration is required) upon satisfying the Department that such user has paid the proper tax (if tax is due) to the retailer. The Department shall adopt appropriate rules to carry out the mandate of this paragraph.

If the user who would otherwise pay tax to the retailer wants the transaction reporting return filed and the payment of the tax or proof of exemption made to the Department before the retailer is willing to take these actions and such user has not paid the tax to the retailer, such user may certify to the fact of such delay by the retailer and may (upon the Department being satisfied of the truth of such certification) transmit the information required by the transaction reporting return and the remittance for tax or proof of exemption directly to the Department and obtain his tax receipt or exemption determination, in which event the transaction reporting return and tax remittance (if a tax payment was required) shall be credited by the Department to the proper retailer's account with the Department, but without the 2.1% or 1.75% discount provided for in this Section being allowed. When the user pays the tax directly to the Department, he shall pay the tax in the same amount and in the same form in which it would be remitted if the tax had been remitted to the Department by the retailer.

Refunds made by the seller during the preceding return period to purchasers, on account of tangible personal property returned to the seller, shall be allowed as a deduction under subdivision 5 of his monthly or quarterly return, as the case may be, in case the seller had theretofore included the receipts from the sale of such tangible personal property in a return filed by him and had paid the tax imposed by this Act with respect to such receipts.

Where the seller is a corporation, the return filed on behalf of such corporation shall be signed by the president, vice-president, secretary or treasurer or by the properly accredited agent of such corporation.

Where the seller is a limited liability company, the return filed on behalf of the limited liability company shall be signed by a manager, member, or properly accredited agent of the limited liability company.

Except as provided in this Section, the retailer filing the return under this Section shall, at the time of filing such return, pay to the Department the amount of tax imposed by this Act less a discount of 2.1% prior to January 1, 1990 and 1.75% on and after January 1, 1990, or $5 per calendar year, whichever is greater, which is allowed to reimburse the retailer for the expenses incurred in keeping records, preparing and filing returns, remitting the tax and supplying data to the Department on request. Any prepayment made pursuant to Section 2d of this Act shall be included in the amount on which such 2.1% or 1.75% discount is computed. In the case of retailers who report and pay the tax on a transaction by transaction basis, as provided in this Section, such discount shall be taken with each such tax remittance instead of when such retailer files his periodic return.

Before October 1, 2000, if the taxpayer's average monthly tax liability to the Department under this Act, the Use Tax Act, the Service Occupation Tax Act, and the Service Use Tax Act, excluding any liability for prepaid sales tax to be remitted in accordance with Section 2d of this Act, was $10,000 or more during the preceding 4 complete calendar quarters, he shall file a return with the Department each month by the 20th day of the month next following the month during which such tax liability is incurred and shall make payments to the Department on or before the 7th, 15th, 22nd and last day of the month during which such liability is incurred. On and after October 1, 2000, if the taxpayer's average monthly tax liability to the Department under this Act, the Use Tax Act, the Service Occupation Tax Act, and the Service Use Tax Act, excluding any liability for prepaid sales tax to be remitted in accordance with Section 2d of this Act, was $20,000 or more during the preceding 4 complete calendar quarters, he shall file a return with the Department each month by the 20th day of the month next following the month during which such tax liability is incurred and shall make payment to the Department on or before the 7th, 15th, 22nd and last day of the month during which such liability is incurred. If the month during which such tax liability is incurred began prior to January 1, 1985, each payment shall be in an amount equal to 1/4 of the taxpayer's actual liability for the month or an amount set by the Department not to exceed 1/4 of the average monthly liability of the taxpayer to the Department for the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability in such 4 quarter period). If the month during which such tax liability is incurred begins on or after January 1, 1985 and prior to January 1, 1987, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 27.5% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1987 and prior to January 1, 1988, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 26.25% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1988, and prior to January 1, 1989, or begins on or after January 1, 1996, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year. If the month during which such tax liability is incurred begins on or after January 1, 1989, and prior to January 1, 1996, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year or 100% of the taxpayer's actual liability for the quarter monthly reporting period. The amount of such quarter monthly payments shall be credited against the final tax liability of the taxpayer's return for that month. Before October 1, 2000, once applicable, the requirement of the making of quarter monthly payments to the Department by taxpayers having an average monthly tax liability of $10,000 or more as determined in the manner provided above shall continue until such taxpayer's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $9,000, or until such taxpayer's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarter period is less than $10,000. However, if a taxpayer can show the Department that a substantial change in the taxpayer's business has occurred which causes the taxpayer to anticipate that his average monthly tax liability for the reasonably foreseeable future will fall below the $10,000 threshold stated above, then such taxpayer may petition the Department for a change in such taxpayer's reporting status. On and after October 1, 2000, once applicable, the requirement of the making of quarter monthly payments to the Department by taxpayers having an average monthly tax liability of $20,000 or more as determined in the manner provided above shall continue until such taxpayer's average monthly liability to the Department during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $19,000 or until such taxpayer's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarter period is less than $20,000. However, if a taxpayer can show the Department that a substantial change in the taxpayer's business has occurred which causes the taxpayer to anticipate that his average monthly tax liability for the reasonably foreseeable future will fall below the $20,000 threshold stated above, then such taxpayer may petition the Department for a change in such taxpayer's reporting status. The Department shall change such taxpayer's reporting status unless it finds that such change is seasonal in nature and not likely to be long term. If any such quarter monthly payment is not paid at the time or in the amount required by this Section, then the taxpayer shall be liable for penalties and interest on the difference between the minimum amount due as a payment and the amount of such quarter monthly payment actually and timely paid, except insofar as the taxpayer has previously made payments for that month to the Department in excess of the minimum payments previously due as provided in this Section. The Department shall make reasonable rules and regulations to govern the quarter monthly payment amount and quarter monthly payment dates for taxpayers who file on other than a calendar monthly basis.

The provisions of this paragraph apply before October 1, 2001. Without regard to whether a taxpayer is required to make quarter monthly payments as specified above, any taxpayer who is required by Section 2d of this Act to collect and remit prepaid taxes and has collected prepaid taxes which average in excess of $25,000 per month during the preceding 2 complete calendar quarters, shall file a return with the Department as required by Section 2f and shall make payments to the Department on or before the 7th, 15th, 22nd and last day of the month during which such liability is incurred. If the month during which such tax liability is incurred began prior to the effective date of this amendatory Act of 1985, each payment shall be in an amount not less than 22.5% of the taxpayer's actual liability under Section 2d. If the month during which such tax liability is incurred begins on or after January 1, 1986, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 27.5% of the taxpayer's liability for the same calendar month of the preceding calendar year. If the month during which such tax liability is incurred begins on or after January 1, 1987, each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 26.25% of the taxpayer's liability for the same calendar month of the preceding year. The amount of such quarter monthly payments shall be credited against the final tax liability of the taxpayer's return for that month filed under this Section or Section 2f, as the case may be. Once applicable, the requirement of the making of quarter monthly payments to the Department pursuant to this paragraph shall continue until such taxpayer's average monthly prepaid tax collections during the preceding 2 complete calendar quarters is $25,000 or less. If any such quarter monthly payment is not paid at the time or in the amount required, the taxpayer shall be liable for penalties and interest on such difference, except insofar as the taxpayer has previously made payments for that month in excess of the minimum payments previously due.

The provisions of this paragraph apply on and after October 1, 2001. Without regard to whether a taxpayer is required to make quarter monthly payments as specified above, any taxpayer who is required by Section 2d of this Act to collect and remit prepaid taxes and has collected prepaid taxes that average in excess of $20,000 per month during the preceding 4 complete calendar quarters shall file a return with the Department as required by Section 2f and shall make payments to the Department on or before the 7th, 15th, 22nd and last day of the month during which the liability is incurred. Each payment shall be in an amount equal to 22.5% of the taxpayer's actual liability for the month or 25% of the taxpayer's liability for the same calendar month of the preceding year. The amount of the quarter monthly payments shall be credited against the final tax liability of the taxpayer's return for that month filed under this Section or Section 2f, as the case may be. Once applicable, the requirement of the making of quarter monthly payments to the Department pursuant to this paragraph shall continue until the taxpayer's average monthly prepaid tax collections during the preceding 4 complete calendar quarters (excluding the month of highest liability and the month of lowest liability) is less than $19,000 or until such taxpayer's average monthly liability to the Department as computed for each calendar quarter of the 4 preceding complete calendar quarters is less than $20,000. If any such quarter monthly payment is not paid at the time or in the amount required, the taxpayer shall be liable for penalties and interest on such difference, except insofar as the taxpayer has previously made payments for that month in excess of the minimum payments previously due.

If any payment provided for in this Section exceeds the taxpayer's liabilities under this Act, the Use Tax Act, the Service Occupation Tax Act and the Service Use Tax Act, as shown on an original monthly return, the Department shall, if requested by the taxpayer, issue to the taxpayer a credit memorandum no later than 30 days after the date of payment. The credit evidenced by such credit memorandum may be assigned by the taxpayer to a similar taxpayer under this Act, the Use Tax Act, the Service Occupation Tax Act or the Service Use Tax Act, in accordance with reasonable rules and regulations to be prescribed by the Department. If no such request is made, the taxpayer may credit such excess payment against tax liability subsequently to be remitted to the Department under this Act, the Use Tax Act, the Service Occupation Tax Act or the Service Use Tax Act, in accordance with reasonable rules and regulations prescribed by the Department. If the Department subsequently determined that all or any part of the credit taken was not actually due to the taxpayer, the taxpayer's 2.1% and 1.75% vendor's discount shall be reduced by 2.1% or 1.75% of the difference between the credit taken and that actually due, and that taxpayer shall be liable for penalties and interest on such difference.

If a retailer of motor fuel is entitled to a credit under Section 2d of this Act which exceeds the taxpayer's liability to the Department under this Act for the month which the taxpayer is filing a return, the Department shall issue the taxpayer a credit memorandum for the excess.

Beginning January 1, 1990, each month the Department shall pay into the Local Government Tax Fund, a special fund in the State treasury which is hereby created, the net revenue realized for the preceding month from the 1% tax on sales of food for human consumption which is to be consumed off the premises where it is sold (other than alcoholic beverages, soft drinks and food which has been prepared for immediate consumption) and prescription and nonprescription medicines, drugs, medical appliances and insulin, urine testing materials, syringes and needles used by diabetics.

Beginning January 1, 1990, each month the Department shall pay into the County and Mass Transit District Fund, a special fund in the State treasury which is hereby created, 4% of the net revenue realized for the preceding month from the 6.25% general rate.

Beginning August 1, 2000, each month the Department shall pay into the County and Mass Transit District Fund 20% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol.

Beginning January 1, 1990, each month the Department shall pay into the Local Government Tax Fund 16% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property.

Beginning August 1, 2000, each month the Department shall pay into the Local Government Tax Fund 80% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol.

Beginning on the effective date of this amendatory Act of the 95th General Assembly, each month, the Department shall deposit the net revenue realized for the preceding month from the counties of Cook, DuPage, Will, Kane, Lake, and McHenry from the 6.25% rate on the selling price of motor fuel and gasohol as follows:

(1) to be paid into the Regional Transportation Support Fund: for each of the first 12 months, 80% of the net revenue; and, for each month thereafter, 80% of the net revenue, but not more than 105% of 1/12th of the amounts paid under this item (1) during the preceding 12-month period;

(2) 80% of the balance must be paid into the State and Local Sales Tax Reform Fund; and

(3) 20% of the balance must be paid into the County and Mass Transit District Fund.

Of the remainder of the moneys received by the Department pursuant to this Act, (a) 1.75% thereof shall be paid into the Build Illinois Fund and (b) prior to July 1, 1989, 2.2% and on and after July 1, 1989, 3.8% thereof shall be paid into the Build Illinois Fund; provided, however, that if in any fiscal year the sum of (1) the aggregate of 2.2% or 3.8%, as the case may be, of the moneys received by the Department and required to be paid into the Build Illinois Fund pursuant to this Act, Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, and Section 9 of the Service Occupation Tax Act, such Acts being hereinafter called the "Tax Acts" and such aggregate of 2.2% or 3.8%, as the case may be, of moneys being hereinafter called the "Tax Act Amount", and (2) the amount transferred to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall be less than the Annual Specified Amount (as hereinafter defined), an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; the "Annual Specified Amount" means the amounts specified below for fiscal years 1986 through 1993:

and means the Certified Annual Debt Service Requirement (as defined in Section 13 of the Build Illinois Bond Act) or the Tax Act Amount, whichever is greater, for fiscal year 1994 and each fiscal year thereafter; and further provided, that if on the last business day of any month the sum of (1) the Tax Act Amount required to be deposited into the Build Illinois Bond Account in the Build Illinois Fund during such month and (2) the amount transferred to the Build Illinois Fund from the State and Local Sales Tax Reform Fund shall have been less than 1/12 of the Annual Specified Amount, an amount equal to the difference shall be immediately paid into the Build Illinois Fund from other moneys received by the Department pursuant to the Tax Acts; and, further provided, that in no event shall the payments required under the preceding proviso result in aggregate payments into the Build Illinois Fund pursuant to this clause (b) for any fiscal year in excess of the greater of (i) the Tax Act Amount or (ii) the Annual Specified Amount for such fiscal year. The amounts payable into the Build Illinois Fund under clause (b) of the first sentence in this paragraph shall be payable only until such time as the aggregate amount on deposit under each trust indenture securing Bonds issued and outstanding pursuant to the Build Illinois Bond Act is sufficient, taking into account any future investment income, to fully provide, in accordance with such indenture, for the defeasance of or the payment of the principal of, premium, if any, and interest on the Bonds secured by such indenture and on any Bonds expected to be issued thereafter and all fees and costs payable with respect thereto, all as certified by the Director of the Bureau of the Budget (now Governor's Office of Management and Budget). If on the last business day of any month in which Bonds are outstanding pursuant to the Build Illinois Bond Act, the aggregate of moneys deposited in the Build Illinois Bond Account in the Build Illinois Fund in such month shall be less than the amount required to be transferred in such month from the Build Illinois Bond Account to the Build Illinois Bond Retirement and Interest Fund pursuant to Section 13 of the Build Illinois Bond Act, an amount equal to such deficiency shall be immediately paid from other moneys received by the Department pursuant to the Tax Acts to the Build Illinois Fund; provided, however, that any amounts paid to the Build Illinois Fund in any fiscal year pursuant to this sentence shall be deemed to constitute payments pursuant to clause (b) of the first sentence of this paragraph and shall reduce the amount otherwise payable for such fiscal year pursuant to that clause (b). The moneys received by the Department pursuant to this Act and required to be deposited into the Build Illinois Fund are subject to the pledge, claim and charge set forth in Section 12 of the Build Illinois Bond Act.

Subject to payment of amounts into the Build Illinois Fund as provided in the preceding paragraph or in any amendment thereto hereafter enacted, the following specified monthly installment of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority provided under Section 8.25f of the State Finance Act, but not in excess of sums designated as "Total Deposit", shall be deposited in the aggregate from collections under Section 9 of the Use Tax Act, Section 9 of the Service Use Tax Act, Section 9 of the Service Occupation Tax Act, and Section 3 of the Retailers' Occupation Tax Act into the McCormick Place Expansion Project Fund in the specified fiscal years.

Beginning July 20, 1993 and in each month of each fiscal year thereafter, one-eighth of the amount requested in the certificate of the Chairman of the Metropolitan Pier and Exposition Authority for that fiscal year, less the amount deposited into the McCormick Place Expansion Project Fund by the State Treasurer in the respective month under subsection (g) of Section 13 of the Metropolitan Pier and Exposition Authority Act, plus cumulative deficiencies in the deposits required under this Section for previous months and years, shall be deposited into the McCormick Place Expansion Project Fund, until the full amount requested for the fiscal year, but not in excess of the amount specified above as "Total Deposit", has been deposited.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning July 1, 1993, the Department shall each month pay into the Illinois Tax Increment Fund 0.27% of 80% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of tangible personal property.

Subject to payment of amounts into the Build Illinois Fund and the McCormick Place Expansion Project Fund pursuant to the preceding paragraphs or in any amendments thereto hereafter enacted, beginning with the receipt of the first report of taxes paid by an eligible business and continuing for a 25-year period, the Department shall each month pay into the Energy Infrastructure Fund 80% of the net revenue realized from the 6.25% general rate on the selling price of Illinois-mined coal that was sold to an eligible business. For purposes of this paragraph, the term "eligible business" means a new electric generating facility certified pursuant to Section 605-332 of the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois.

Of the remainder of the moneys received by the Department pursuant to this Act, 75% thereof shall be paid into the State Treasury and 25% shall be reserved in a special account and used only for the transfer to the Common School Fund as part of the monthly transfer from the General Revenue Fund in accordance with Section 8a of the State Finance Act.

The Department may, upon separate written notice to a taxpayer, require the taxpayer to prepare and file with the Department on a form prescribed by the Department within not less than 60 days after receipt of the notice an annual information return for the tax year specified in the notice. Such annual return to the Department shall include a statement of gross receipts as shown by the retailer's last Federal income tax return. If the total receipts of the business as reported in the Federal income tax return do not agree with the gross receipts reported to the Department of Revenue for the same period, the retailer shall attach to his annual return a schedule showing a reconciliation of the 2 amounts and the reasons for the difference. The retailer's annual return to the Department shall also disclose the cost of goods sold by the retailer during the year covered by such return, opening and closing inventories of such goods for such year, costs of goods used from stock or taken from stock and given away by the retailer during such year, payroll information of the retailer's business during such year and any additional reasonable information which the Department deems would be helpful in determining the accuracy of the monthly, quarterly or annual returns filed by such retailer as provided for in this Section.

If the annual information return required by this Section is not filed when and as required, the taxpayer shall be liable as follows:

(i) Until January 1, 1994, the taxpayer shall be liable for a penalty equal to 1/6 of 1% of the tax due from such taxpayer under this Act during the period to be covered by the annual return for each month or fraction of a month until such return is filed as required, the penalty to be assessed and collected in the same manner as any other penalty provided for in this Act.

(ii) On and after January 1, 1994, the taxpayer shall be liable for a penalty as described in Section 3-4 of the Uniform Penalty and Interest Act.

The chief executive officer, proprietor, owner or highest ranking manager shall sign the annual return to certify the accuracy of the information contained therein. Any person who willfully signs the annual return containing false or inaccurate information shall be guilty of perjury and punished accordingly. The annual return form prescribed by the Department shall include a warning that the person signing the return may be liable for perjury.

The provisions of this Section concerning the filing of an annual information return do not apply to a retailer who is not required to file an income tax return with the United States Government.

As soon as possible after the first day of each month, upon certification of the Department of Revenue, the Comptroller shall order transferred and the Treasurer shall transfer from the General Revenue Fund to the Motor Fuel Tax Fund an amount equal to 1.7% of 80% of the net revenue realized under this Act for the second preceding month. Beginning April 1, 2000, this transfer is no longer required and shall not be made.

Net revenue realized for a month shall be the revenue collected by the State pursuant to this Act, less the amount paid out during that month as refunds to taxpayers for overpayment of liability.

For greater simplicity of administration, manufacturers, importers and wholesalers whose products are sold at retail in Illinois by numerous retailers, and who wish to do so, may assume the responsibility for accounting and paying to the Department all tax accruing under this Act with respect to such sales, if the retailers who are affected do not make written objection to the Department to this arrangement.

Any person who promotes, organizes, provides retail selling space for concessionaires or other types of sellers at the Illinois State Fair, DuQuoin State Fair, county fairs, local fairs, art shows, flea markets and similar exhibitions or events, including any transient merchant as defined by Section 2 of the Transient Merchant Act of 1987, is required to file a report with the Department providing the name of the merchant's business, the name of the person or persons engaged in merchant's business, the permanent address and Illinois Retailers Occupation Tax Registration Number of the merchant, the dates and location of the event and other reasonable information that the Department may require. The report must be filed not later than the 20th day of the month next following the month during which the event with retail sales was held. Any person who fails to file a report required by this Section commits a business offense and is subject to a fine not to exceed $250.

Any person engaged in the business of selling tangible personal property at retail as a concessionaire or other type of seller at the Illinois State Fair, county fairs, art shows, flea markets and similar exhibitions or events, or any transient merchants, as defined by Section 2 of the Transient Merchant Act of 1987, may be required to make a daily report of the amount of such sales to the Department and to make a daily payment of the full amount of tax due. The Department shall impose this requirement when it finds that there is a significant risk of loss of revenue to the State at such an exhibition or event. Such a finding shall be based on evidence that a substantial number of concessionaires or other sellers who are not residents of Illinois will be engaging in the business of selling tangible personal property at retail at the exhibition or event, or other evidence of a significant risk of loss of revenue to the State. The Department shall notify concessionaires and other sellers affected by the imposition of this requirement. In the absence of notification by the Department, the concessionaires and other sellers shall file their returns as otherwise required in this Section.

(Source: P.A. 93-22, eff. 6-20-03; 93-24, eff. 6-20-03; 93-840, eff. 7-30-04; 93-926, eff. 8-12-04; 93-1057, eff. 12-2-04; 94-1074, eff. 12-26-06.)

Section 40. The Illinois Pension Code is amended by changing Section 22-101 and by adding Section 22-101B as follows:

(40 ILCS 5/22-101) (from Ch. 108 1/2, par. 22-101)

Sec. 22-101. Retirement Plan for Chicago Transit Authority Employees. Metropolitan Transit Authority (CTA) Pension Fund.

(a) There shall be established and maintained by the Authority created by the "Metropolitan Transit Authority Act", approved April 12, 1945, as amended, (referred to in this Section as the "Authority") a financially sound pension and retirement system adequate to provide for all payments when due under such established system or as modified from time to time by ordinance of the Chicago Transit Board or collective bargaining agreement. For this purpose, the Board must make contributions to the established system as required under this Section and may make any additional contributions provided for by Board ordinance or collective bargaining agreement. The participating employees shall make such periodic payments to the established system as required under this Section and may make any additional contributions provided for may be determined by Board ordinance or collective bargaining agreement. The Board, in lieu of social security payments required to be paid by private corporations engaged in similar activity, shall make payments into such established system at least equal in amount to the amount so required to be paid by such private corporations.

Provisions shall be made by the Board for all Board members, officers and employees of the Authority appointed pursuant to the "Metropolitan Transit Authority Act" to become, subject to reasonable rules and regulations, participants members or beneficiaries of the pension or retirement system with uniform rights, privileges, obligations and status as to the class in which such officers and employees belong. The terms, conditions and provisions of any pension or retirement system or of any amendment or modification thereof affecting employees who are members of any labor organization may be established, amended or modified by agreement with such labor organization, provided the terms, conditions and provisions must be consistent with this Act, the annual funding levels for the retirement system established by law must be met and the benefits paid to future participants in the system may not exceed the benefit ceilings set for future participants under this Act and the contribution levels required by the Authority and its employees may not be less than the contribution levels established under this Act but must be consistent with the requirements of this Section.

(b) The Board of Trustees shall consist of 11 members appointed as follows: (i) 5 trustees shall be appointed by the Chicago Transit Board; (ii) 3 trustees shall be appointed by an organization representing the highest number of Chicago Transit Authority participants; (iii) one trustee shall be appointed by an organization representing the second-highest number of Chicago Transit Authority participants; (iv) one trustee shall be appointed by the recognized coalition representatives of participants who are not represented by an organization with the highest or second-highest number of Chicago Transit Authority participants; and (v) one trustee shall be selected by the Regional Transportation Authority Board of Directors, and the trustee shall be a professional fiduciary who has experience in the area of collectively bargained pension plans. Trustees shall serve until a successor has been appointed and qualified, or until resignation, death, incapacity, or disqualification.

Any person appointed as a trustee of the board shall qualify by taking an oath of office that he or she will diligently and honestly administer the affairs of the system and will not knowingly violate or willfully permit the violation of any of the provisions of law applicable to the Plan, including Sections 1-109, 1-109.1, 1-109.2, 1-110, 1-111, 1-114, and 1-115 of the Illinois Pension Code.

Each trustee shall cast individual votes, and a majority vote shall be final and binding upon all interested parties. Each trustee shall have the rights, privileges, authority, and obligations as are usual and customary for such fiduciaries.

The Board of Trustees may cause amounts on deposit in the Retirement Plan to be invested in those investments that are permitted investments for the investment of moneys held under any one or more of the pension or retirement systems of the State, any unit of local government or school district, or any agency or instrumentality thereof. The Board, by a vote of at least two-thirds of the trustees, may transfer investment management to the Illinois State Board of Investment, which is hereby authorized to manage these investments when so requested by the Board of Trustees.

(c) All individuals who were previously participants in the Retirement Plan for Chicago Transit Authority Employees shall remain participants, and shall receive the same benefits established by the Retirement Plan for Chicago Transit Authority Employees, except as provided in this amendatory Act or by subsequent legislative enactment or amendment to the Retirement Plan. For Authority employees hired on or after January 1, 2008, the Retirement Plan for Chicago Transit Authority Employees shall be the exclusive retirement plan and such employees shall not be eligible for any supplemental plan, except for a deferred compensation plan funded only by employee contributions.

For all Authority employees who are first hired on or after January 1, 2008 and are participants in the Retirement Plan for Chicago Transit Authority Employees, the following terms, conditions and provisions with respect to retirement shall be applicable:

(1) Such participant shall be eligible for an unreduced retirement allowance for life upon the attainment of age 64 with 25 years of continuous service.

(2) Such participant shall be eligible for a reduced retirement allowance for life upon the attainment of age 55 with 10 years of continuous service.

(3) For the purpose of determining the retirement allowance to be paid to a retiring employee, the term "Continuous Service" as used in the Retirement Plan for Chicago Transit Authority Employees shall also be deemed to include all pension credit for service with any retirement system established under Article 8 or Article 11 of this Code, provided that the employee forfeits and relinquishes all pension credit under Article 8 or Article 11 of this Code, and the contribution required under this subsection is made by the employee. The Retirement Plan's actuary shall determine the contribution paid by the employee as an amount equal to the normal cost of the benefit accrued, had the service been rendered as an employee, plus interest per annum from the time such service was rendered until the date the payment is made.

(d) From the effective date of this amendatory Act through December 31, 2008, all participating employees shall contribute to the Retirement Plan in an amount not less than 6% of compensation, and the Authority shall contribute to the Retirement Plan in an amount not less than 12% of compensation.

(e)(1) Beginning January 1, 2009 the Authority shall make contributions to the Retirement Plan in an amount equal to twelve percent (12%) of compensation and participating employees shall make contributions to the Retirement Plan in an amount equal to six percent (6%) of compensation. These contributions may be paid by the Authority and participating employees on a payroll or other periodic basis, but shall in any case be paid to the Retirement Plan at least monthly.

(2) For the period ending December 31, 2039, the amount paid by the Authority in any year with respect to debt service on bonds issued for the purposes of funding a contribution to the Retirement Plan under Section 12c of the Metropolitan Transit Authority Act, other than debt service paid with the proceeds of bonds or notes issued by the Authority for any year after calendar year 2008, shall be treated as a credit against the amount of required contribution to the Retirement Plan by the Authority under subsection (e)(1) for the following year up to an amount not to exceed 6% of compensation paid by the Authority in that following year.

(3) By September 15 of each year beginning in 2009 and ending on December 31, 2038, on the basis of a report prepared by an enrolled actuary retained by the Plan, the Board of Trustees of the Retirement Plan shall determine the estimated funded ratio of the total assets of the Retirement Plan to its total actuarially determined liabilities. A report containing that determination and the actuarial assumptions on which it is based shall be filed with the Authority, the representatives of its participating employees, the Auditor General of the State of Illinois, and the Regional Transportation Authority. If the funded ratio is projected to decline below 60% in any year before 2039, the Board of Trustees shall also determine the increased contribution required each year as a level percentage of payroll over the years remaining until 2039 using the projected unit credit actuarial cost method so the funded ratio does not decline below 60% and include that determination in its report. If the actual funded ratio declines below 60% in any year prior to 2039, the Board of Trustees shall also determine the increased contribution required each year as a level percentage of payroll during the years after the then current year using the projected unit credit actuarial cost method so the funded ratio is projected to reach at least 60% no later than 10 years after the then current year and include that determination in its report. Within 60 days after receiving the report, the Auditor General shall review the determination and the assumptions on which it is based, and if he finds that the determination and the assumptions on which it is based are unreasonable in the aggregate, he shall issue a new determination of the funded ratio, the assumptions on which it is based and the increased contribution required each year as a level percentage of payroll over the years remaining until 2039 using the projected unit credit actuarial cost method so the funded ratio does not decline below 60%, or, in the event of an actual decline below 60%, so the funded ratio is projected to reach 60% by no later than 10 years after the then current year. If the Board of Trustees or the Auditor General determine that an increased contribution is required to meet the funded ratio required by the subsection, effective January 1 following the determination or 30 days after such determination, whichever is later, one-third of the increased contribution shall be paid by participating employees and two-thirds by the Authority, in addition to the contributions required by this subsection (1).

(4) For the period beginning 2039, the minimum contribution to the Retirement Plan for each fiscal year shall be an amount determined by the Board of Trustees of the Retirement Plan to be sufficient to bring the total assets of the Retirement Plan up to 90% of its total actuarial liabilities by the end of 2058. Participating employees shall be responsible for one-third of the required contribution and the Authority shall be responsible for two-thirds of the required contribution. In making these determinations, the Board of Trustees shall calculate the required contribution each year as a level percentage of payroll over the years remaining to and including fiscal year 2058 using the projected unit credit actuarial cost method. A report containing that determination and the actuarial assumptions on which it is based shall be filed by September 15 of each year with the Authority, the representatives of its participating employees, the Auditor General of the State of Illinois and the Regional Transportation Authority. If the funded ratio is projected to fail to reach 90% by December 31, 2058, the Board of Trustees shall also determine the increased contribution required each year as a level percentage of payroll over the years remaining until December 31, 2058 using the projected unit credit actuarial cost method so the funded ratio will meet 90% by December 31, 2058 and include that determination in its report. Within 60 days after receiving the report, the Auditor General shall review the determination and the assumptions on which it is based and if he finds that the determination and the assumptions on which it is based are unreasonable in the aggregate, he shall issue a new determination of the funded ratio, the assumptions on which it is based and the increased contribution required each year as a level percentage of payroll over the years remaining until December 31, 2058 using the projected unit credit actuarial cost method so the funded ratio reaches no less than 90% by December 31, 2058. If the Board of Trustees or the Auditor General determine that an increased contribution is required to meet the funded ratio required by this subsection, effective January 1 following the determination or 30 days after such determination, whichever is later, one-third of the increased contribution shall be paid by participating employees and two-thirds by the Authority, in addition to the contributions required by subsection (e)(1).

(5) Beginning in 2059, the minimum contribution for each year shall be the amount needed to maintain the total assets of the Retirement Plan at 90% of the total actuarial liabilities of the Plan, and the contribution shall be funded two-thirds by the Authority and one-third by the participating employees in accordance with this subsection.

(f) The Authority shall take the steps necessary to comply with Section 414(h)(2) of the Internal Revenue Code of 1986, as amended, to permit the pick-up of employee contributions under subsections (d) and (e) on a tax-deferred basis.

(g) The Board of Trustees shall certify to the Governor, the General Assembly, the Auditor General, the Board of the Regional Transportation Authority, and the Authority at least 90 days prior to the end of each fiscal year the amount of the required contributions to the retirement system for the next retirement system fiscal year under this Section. The certification shall include a copy of the actuarial recommendations upon which it is based. In addition, copies of the certification shall be sent to the Commission on Government Forecasting and Accountability and the Mayor of Chicago.

(h)(1) As to an employee who first becomes entitled to a retirement allowance commencing on or after November 30, 1989, the retirement allowance shall be the amount determined in accordance with the following formula:

(A) One percent (1%) of his "Average Annual Compensation in the highest four (4) completed Plan Years" for each full year of continuous service from the date of original employment to the effective date of the Plan; plus

(B) One and seventy-five hundredths percent (1.75%) of his "Average Annual Compensation in the highest four (4) completed Plan Years" for each year (including fractions thereof to completed calendar months) of continuous service as provided for in the Retirement Plan for Chicago Transit Authority Employees. Provided, however that:

(2) As to an employee who first becomes entitled to a retirement allowance commencing on or after January 1, 1993, the retirement allowance shall be the amount determined in accordance with the following formula:

(A) One percent (1%) of his "Average Annual Compensation in the highest four (4) completed Plan Years" for each full year of continuous service from the date of original employment to the effective date of the Plan; plus

(B) One and eighty hundredths percent (1.80%) of his "Average Annual Compensation in the highest four (4) completed Plan Years" for each year (including fractions thereof to completed calendar months) of continuous service as provided for in the Retirement Plan for Chicago Transit Authority Employees. Provided, however that:

(3) As to an employee who first becomes entitled to a retirement allowance commencing on or after January 1, 1994, the retirement allowance shall be the amount determined in accordance with the following formula:

(A) One percent (1%) of his "Average Annual Compensation in the highest four (4) completed Plan Years" for each full year of continuous service from the date of original employment to the effective date of the Plan; plus

(B) One and eighty-five hundredths percent (1.85%) of his "Average Annual Compensation in the highest four (4) completed Plan Years" for each year (including fractions thereof to completed calendar months) of continuous service as provided for in the Retirement Plan for Chicago Transit Authority Employees. Provided, however that:

(4) As to an employee who first becomes entitled to a retirement allowance commencing on or after January 1, 2000, the retirement allowance shall be the amount determined in accordance with the following formula:

(A) One percent (1%) of his "Average Annual Compensation in the highest four (4) completed Plan Years" for each full year of continuous service from the date of original employment to the effective date of the Plan; plus

(B) Two percent (2%) of his "Average Annual Compensation in the highest four (4) completed Plan Years" for each year (including fractions thereof to completed calendar months) of continuous service as provided for in the Retirement Plan for Chicago Transit Authority Employees. Provided, however that:

(5) As to an employee who first becomes entitled to a retirement allowance commencing on or after January 1, 2001, the retirement allowance shall be the amount determined in accordance with the following formula:

(A) One percent (1%) of his "Average Annual Compensation in the highest four (4) completed Plan Years" for each full year of continuous service from the date of original employment to the effective date of the Plan; plus

(B) Two and fifteen hundredths percent (2.15%) of his "Average Annual Compensation in the highest four (4) completed Plan Years" for each year (including fractions thereof to completed calendar months) of continuous service as provided for in the Retirement Plan for Chicago Transit Authority Employees.

The changes made by this amendatory Act of the 95th General Assembly, to the extent that they affect the rights or privileges of Authority employees that are currently the subject of collective bargaining, have been agreed to between the authorized representatives of these employees and of the Authority prior to enactment of this amendatory Act, as evidenced by a Memorandum of Understanding between these representatives that will be filed with the Secretary of State Index Department and designated as "95-GA-C05". The General Assembly finds and declares that those changes are consistent with 49 U.S.C. 5333(b) (also known as Section 13(c) of the Federal Transit Act) because of this agreement between authorized representatives of these employees and of the Authority, and that any future amendments to the provisions of this amendatory Act of the 95th General Assembly, to the extent those amendments would affect the rights and privileges of Authority employees that are currently the subject of collective bargaining, would be consistent with 49 U.S.C. 5333(b) if and only if those amendments were agreed to between these authorized representatives prior to enactment.

(i) Early retirement incentive plan; funded ratio.

(1) Beginning on the effective date of this Section, no early retirement incentive shall be offered to participants of the Plan unless the Funded Ratio of the Plan is at least 80% or more.

(2) For the purposes of this Section, the Funded Ratio shall be the Adjusted Assets divided by the Actuarial Accrued Liability developed in accordance with Statement #25 promulgated by the Government Accounting Standards Board and the actuarial assumptions described in the Plan. The Adjusted Assets shall be calculated based on the methodology described in the Plan.

(j) Nothing in this amendatory Act of the 95th General Assembly shall impair the rights or privileges of Authority employees under any other law.

(b) Beginning January 1, 2009, the Authority shall make contributions to the retirement system in an amount which, together with the contributions of participants, interest earned on investments, and other income, will meet the cost of maintaining and administering the retirement plan in accordance with applicable actuarial recommendations and assumptions and the requirements of this Section. These contributions may be paid on a payroll or other periodic basis, but shall in any case be paid at least monthly.

For retirement system fiscal years 2009 through 2058, the minimum contribution to the retirement system to be made by the Authority for each fiscal year shall be an amount determined jointly by the Authority and the trustee of the retirement system to be sufficient to bring the total assets of the retirement system up to 90% of its total actuarial liabilities by the end of fiscal year 2058. In making these determinations, the required Authority contribution shall be calculated each year as a level percentage of payroll over the years remaining to and including fiscal year 2058 and shall be determined under the projected unit credit actuarial cost method. Beginning in retirement system fiscal year 2059, the minimum Authority contribution for each fiscal year shall be the amount needed to maintain the total assets of the retirement system at 90% of the total actuarial liabilities of the system.

For purposes of determining employer contributions and actuarial liabilities under this subsection, contributions and liabilities relating to health care benefits shall not be included. As used in this Section, "retirement system fiscal year" means the calendar year, or such other plan year as may be defined from time to time in the agreement known as the Retirement Plan for Chicago Transit Authority Employees, or its successor agreement.

(c) The Authority and the trustee shall jointly certify to the Governor, the General Assembly, and the Board of the Regional Transportation Authority on or before November 15 of 2008 and of each year thereafter the amount of the required Authority contributions to the retirement system for the next retirement system fiscal year under subsection (b). The certification shall include a copy of the actuarial recommendations upon which it is based. In addition, copies of the certification shall be sent to the Commission on Government Forecasting and Accountability, the Mayor of Chicago, the Chicago City Council, and the Cook County Board.

(d) The Authority shall take all actions lawfully available to it to separate the funding of health care benefits for retirees and their dependents and survivors from the funding for its retirement system. The Authority shall endeavor to achieve this separation as soon as possible, and in any event no later than January 1, 2009.

(e) This amendatory Act of the 94th General Assembly does not affect or impair the right of either the Authority or its employees to collectively bargain the amount or level of employee contributions to the retirement system.

(Source: P.A. 94-839, eff. 6-6-06.)

(40 ILCS 5/22-101B new)

Sec. 22-101B. Health Care Benefits.

(a) The Chicago Transit Authority (hereinafter referred to in this Section as the "Authority") shall take all actions lawfully available to it to separate the funding of health care benefits for retirees and their dependents and survivors from the funding for its retirement system. The Authority shall endeavor to achieve this separation as soon as possible, and in any event no later than January 1, 2009.

(b) Effective January 1, 2008, a Retiree Health Care Trust is established for the purpose of providing health care benefits to eligible retirees and their dependents and survivors in accordance with the terms and conditions set forth in this Section 22-101B. The Retiree Health Care Trust shall be solely responsible for providing health care benefits to eligible retirees and their dependents and survivors by no later than January 1, 2009, but no earlier than July 1, 2008.

(1) The Board of Trustees shall consist of 7 members appointed as follows: (i) 3 trustees shall be appointed by the Chicago Transit Board; (ii) one trustee shall be appointed by an organization representing the highest number of Chicago Transit Authority participants; (iii) one trustee shall be appointed by an organization representing the second-highest number of Chicago Transit Authority participants; (iv) one trustee shall be appointed by the recognized coalition representatives of participants who are not represented by an organization with the highest or second-highest number of Chicago Transit Authority participants; and (v) one trustee shall be selected by the Regional Transportation Authority Board of Directors, and the trustee shall be a professional fiduciary who has experience in the area of collectively bargained retiree health plans. Trustees shall serve until a successor has been appointed and qualified, or until resignation, death, incapacity, or disqualification.

Any person appointed as a trustee of the board shall qualify by taking an oath of office that he or she will diligently and honestly administer the affairs of the system, and will not knowingly violate or willfully permit the violation of any of the provisions of law applicable to the Plan, including Sections 1-109, 1-109.1, 1-109.2, 1-110, 1-111, 1-114, and 1-115 of Article 1 of the Illinois Pension Code.

Each trustee shall cast individual votes, and a majority vote shall be final and binding upon all interested parties. Each trustee shall have the rights, privileges, authority and obligations as are usual and customary for such fiduciaries.

(2) The Board of Trustees shall establish and administer a health care benefit program for eligible retirees and their dependents and survivors. The health care benefit program for eligible retirees and their dependents and survivors shall not contain any plan which provides for more than 90% coverage for in-network services or 70% coverage for out-of-network services after any deductible has been paid.

(3) The Retiree Health Care Trust shall be administered by the Board of Trustees according to the following requirements:

(i) The Board of Trustees may cause amounts on deposit in the Retiree Health Care Trust to be invested in those investments that are permitted investments for the investment of moneys held under any one or more of the pension or retirement systems of the State, any unit of local government or school district, or any agency or instrumentality thereof. The Board, by a vote of at least two-thirds of the trustees, may transfer investment management to the Illinois State Board of Investment, which is hereby authorized to manage these investments when so requested by the Board of Trustees.

(ii) The Board of Trustees shall establish and maintain an appropriate funding reserve level which shall not be less than the amount of incurred and unreported claims plus 12 months of expected claims and administrative expenses.

(iii) The Board of Trustees shall make an annual assessment of the funding levels of the Retiree Health Care Trust and shall submit a report to the Auditor General at least 90 days prior to the end of the fiscal year. The report shall provide the following:

(A) the actuarial present value of projected benefits expected to be paid to current and future retirees and their dependents and survivors;

(B) the actuarial present value of projected contributions and trust income plus assets;

(C) the reserve required by subsection (b)(3)(ii); and

(D) an assessment of whether the actuarial present value of projected benefits expected to be paid to current and future retirees and their dependents and survivors exceeds or is less than the actuarial present value of projected contributions and trust income plus assets in excess of the reserve required by subsection (b)(3)(ii).

If the actuarial present value of projected benefits expected to be paid to current and future retirees and their dependents and survivors exceeds the actuarial present value of projected contributions and trust income plus assets in excess of the reserve required by subsection (b)(3)(ii), then the report shall provide a plan of increases in employee, retiree, dependent, or survivor contribution levels, decreases in benefit levels, or both, which is projected to cure the shortfall over a period of not more than 10 years. If the actuarial present value of projected benefits expected to be paid to current and future retirees and their dependents and survivors is less than the actuarial present value of projected contributions and trust income plus assets in excess of the reserve required by subsection (b)(3)(ii), then the report may provide a plan of decreases in employee, retiree, dependent, or survivor contribution levels, increases in benefit levels, or both, to the extent of the surplus.

(iv) The Auditor General shall review the report and plan provided in subsection (b)(3)(iii) and issue a determination within 90 days after receiving the report and plan, with a copy of such determination provided to the General Assembly and the Regional Transportation Authority, as follows:

(A) In the event of a projected shortfall, if the Auditor General determines that the assumptions stated in the report are not unreasonable in the aggregate and that the plan of increases in employee, retiree, dependent, or survivor contribution levels, decreases in benefit levels, or both, is reasonably projected to cure the shortfall over a period of not more than 10 years, then the Board of Trustees shall implement the plan. If the Auditor General determines that the assumptions stated in the report are unreasonable in the aggregate, or that the plan of increases in employee, retiree, dependent, or survivor contribution levels, decreases in benefit levels, or both, is not reasonably projected to cure the shortfall over a period of not more than 10 years, then the Board of Trustees shall not implement the plan, the Auditor General shall explain the basis for such determination to the Board of Trustees, and the Auditor General may make recommendations as to an alternative report and plan.

(B) In the event of a projected surplus, if the Auditor General determines that the assumptions stated in the report are not unreasonable in the aggregate and that the plan of decreases in employee, retiree, dependent, or survivor contribution levels, increases in benefit levels, or both, is not unreasonable in the aggregate, then the Board of Trustees shall implement the plan. If the Auditor General determines that the assumptions stated in the report are unreasonable in the aggregate, or that the plan of decreases in employee, retiree, dependent, or survivor contribution levels, increases in benefit levels, or both, is unreasonable in the aggregate, then the Board of Trustees shall not implement the plan, the Auditor General shall explain the basis for such determination to the Board of Trustees, and the Auditor General may make recommendations as to an alternative report and plan.

(C) The Board of Trustees shall submit an alternative report and plan within 45 days after receiving a rejection determination by the Auditor General. A determination by the Auditor General on any alternative report and plan submitted by the Board of Trustees shall be made within 90 days after receiving the alternative report and plan, and shall be accepted or rejected according to the requirements of this subsection (b)(3)(iv). The Board of Trustees shall continue to submit alternative reports and plans to the Auditor General, as necessary, until a favorable determination is made by the Auditor General.

(4) For any retiree who first retires effective January 1, 2008 or thereafter, to be eligible for retiree health care benefits upon retirement, the retiree must be at least 55 years of age, retire with 10 or more years of continuous service and satisfy the preconditions established by this amendatory Act in addition to any rules or regulations promulgated by the Board of Trustees. This paragraph (4) shall not apply to a disability allowance.

(5) Effective July 1, 2008, the aggregate amount of retiree, dependent and survivor contributions to the cost of their health care benefits shall not exceed more than 45% of the total cost of such benefits. The Board of Trustees shall have the discretion to provide different contribution levels for retirees, dependents and survivors based on their years of service, level of coverage or Medicare eligibility, provided that the total contribution from all retirees, dependents, and survivors shall be not more than 45% of the total cost of such benefits. The term "total cost of such benefits" for purposes of this subsection shall be the total amount expended by the retiree health benefit program in the prior plan year, as calculated and certified in writing by the Retiree Health Care Trust's enrolled actuary to be appointed and paid for by the Board of Trustees.

(6) Effective January 1, 2008, all employees of the Authority shall contribute to the Retiree Health Care Trust in an amount not less than 3% of compensation.

(7) No earlier than July 1, 2008 and no later than January 1, 2009 as the Retiree Health Care Trust becomes solely responsible for providing health care benefits to eligible retirees and their dependents and survivors in accordance with subsection (b) of this Section 22-101B, the Authority shall not have any obligation to provide health care to current or future retirees and their dependents or survivors. The Authority, its employees, and the retirees, dependents and survivors who are required to make contributions to the Retiree Health Care Trust shall make contributions at the level set by the Board of Trustees pursuant to the requirements of this Section 22-101B.

Section 45. The Metropolitan Transit Authority Act is amended by changing Sections 15, 28a, 34, and 46 and by adding Sections 12c and 50 as follows:

(70 ILCS 3605/12c new)

Sec. 12c. Retiree Benefits Bonds and Notes.

(a) In addition to all other bonds or notes that it is authorized to issue, the Authority is authorized to issue its bonds or notes for the purposes of providing funds for the Authority to make the deposits described in Section 12c(b)(1) and (2), for refunding any bonds authorized to be issued under this Section, as well as for the purposes of paying costs of issuance, obtaining bond insurance or other credit enhancement or liquidity facilities, paying costs of obtaining related swaps as authorized in the Bond Authorization Act ("Swaps"), providing a debt service reserve fund, paying Debt Service (as defined in paragraph (i) of this Section 12c), and paying all other costs related to any such bonds or notes.

(b)(1) After its receipt of a certified copy of a report of the Auditor General of the State of Illinois meeting the requirements of Section 3-2.3 of the Illinois State Auditing Act, the Authority may issue $1,227,000,000 aggregate original principal amount of bonds and notes. After payment of the costs of issuance and necessary deposits to funds and accounts established with respect to debt service, the net proceeds of such bonds or notes shall be deposited only in the Retirement Plan for Chicago Transit Authority Employees and used only for the purposes required by Section 22-101 of the Illinois Pension Code. Provided that no less than $1,000,000,000 has been deposited in the Retirement Plan, remaining proceeds of bonds issued under this subparagraph (b)(1) may be used to pay costs of issuance and make necessary deposits to funds and accounts with respect to debt service for bonds and notes issued under this subparagraph or subparagraph (b)(2).

(2) After its receipt of a certified copy of a report of the Auditor General of the State of Illinois meeting the requirements of Section 3-2.3 of the Illinois State Auditing Act, the Authority may issue $553,000,000 aggregate original principal amount of bonds and notes. After payment of the costs of issuance and necessary deposits to funds and accounts established with respect to debt service, the net proceeds of such bonds or notes shall be deposited only in the Retiree Health Care Trust and used only for the purposes required by Section 22-101B of the Illinois Pension Code. Provided that no less than $450,000,000 has been deposited in the Retiree Health Care Trust, remaining proceeds of bonds issued under this subparagraph (b)(2) may be used to pay costs of issuance and make necessary deposits to funds and accounts with respect to debt service for bonds and notes issued under this subparagraph or subparagraph (b)(1).

(3) In addition, refunding bonds are authorized to be issued for the purpose of refunding outstanding bonds or notes issued under this Section 12c.

(4) The bonds or notes issued under 12c(b)(1) shall be issued as soon as practicable after the Auditor General issues the report provided in Section 3-2.3(b) of the Illinois State Auditing Act. The bonds or notes issued under 12c(b)(2) shall be issued as soon as practicable after the Auditor General issues the report provided in Section 3-2.3(c) of the Illinois State Auditing Act.

(5) With respect to bonds and notes issued under subparagraph (b), scheduled aggregate annual payments of interest or deposits into funds and accounts established for the purpose of such payment shall commence within one year after the bonds and notes are issued. With respect to principal and interest, scheduled aggregate annual payments of principal and interest or deposits into funds and accounts established for the purpose of such payment shall be not less than 70% in 2009, 80% in 2010, and 90% in 2011, respectively, of scheduled payments or deposits of principal and interest in 2012 and shall be substantially equal beginning in 2012 and each year thereafter. For purposes of this subparagraph (b), "substantially equal" means that debt service in any full year after calendar year 2011 is not more than 115% of debt service in any other full year after calendar year 2011 during the term of the bonds or notes. For the purposes of this subsection (b), with respect to bonds and notes that bear interest at a variable rate, interest shall be assumed at a rate equal to the rate for United States Treasury Securities - State and Local Government Series for the same maturity, plus 75 basis points. If the Authority enters into a Swap with a counterparty requiring the Authority to pay a fixed interest rate on a notional amount, and the Authority has made a determination that such Swap was entered into for the purpose of providing substitute interest payments for variable interest rate bonds or notes of a particular maturity or maturities in a principal amount equal to the notional amount of the Swap, then during the term of the Swap for purposes of any calculation of interest payable on such bonds or notes, the interest rate on the bonds or notes of such maturity or maturities shall be determined as if such bonds or notes bore interest at the fixed interest rate payable by the Authority under such Swap.

(6) No bond or note issued under this Section 12c shall mature later than December 31, 2039.

(c) The Chicago Transit Board shall provide for the issuance of bonds or notes as authorized in this Section 12c by the adoption of an ordinance. The ordinance, together with the bonds or notes, shall constitute a contract among the Authority, the owners from time to time of the bonds or notes, any bond trustee with respect to the bonds or notes, any related credit enhancer and any provider of any related Swaps.

(d) The Authority is authorized to cause the proceeds of the bonds or notes, and any interest or investment earnings on the bonds or notes, and of any Swaps, to be invested until the proceeds and any interest or investment earnings have been deposited with the Retirement Plan or the Retiree Health Care Trust.

(e) Bonds or notes issued pursuant to this Section 12c may be general obligations of the Authority, to which shall be pledged the full faith and credit of the Authority, or may be obligations payable solely from particular sources of funds all as may be provided in the authorizing ordinance. The authorizing ordinance for the bonds and notes, whether or not general obligations of the Authority, may provide for the Debt Service (as defined in paragraph (i) of this Section 12c) to have a claim for payment from particular sources of funds, including, without limitation, amounts to be paid to the Authority or a bond trustee. The authorizing ordinance may provide for the means by which the bonds or notes (and any related Swaps) may be secured, which may include, a pledge of any revenues or funds of the Authority from whatever source which may by law be utilized for paying Debt Service. In addition to any other security, upon the written approval of the Regional Transportation Authority by the affirmative vote of 12 of its then Directors, the ordinance shall provide a specific pledge or assignment of and lien on or security interest in amounts to be paid to the Authority by the Regional Transportation Authority from the proceeds of any tax levied by the Regional Transportation Authority under Section 4.03 of the Regional Transportation Authority Act and direct payment thereof to the bond trustee for payment of Debt Service with respect to the bonds or notes, subject to the provisions of existing lease agreements of the Authority with any public building commission. The authorizing ordinance may also provide a specific pledge or assignment of and lien on or security interest in and direct payment to the trustee of all or a portion of the moneys otherwise payable to the Authority from the City of Chicago pursuant to an intergovernmental agreement with the Authority to provide financial assistance to the Authority. Any such pledge, assignment, lien or security interest for the benefit of owners of bonds or notes shall be valid and binding from the time the bonds or notes are issued, without any physical delivery or further act, and shall be valid and binding as against and prior to the claims of all other parties having claims of any kind against the Authority or any other person, irrespective of whether such other parties have notice of such pledge, assignment, lien or security interest, all as provided in the Local Government Debt Reform Act, as it may be amended from time to time. The bonds or notes of the Authority issued pursuant to this Section 12c shall have such priority of payment and as to their claim for payment from particular sources of funds, including their priority with respect to obligations of the Authority issued under other Sections of this Act, all as shall be provided in the ordinances authorizing the issuance of the bonds or notes. The ordinance authorizing the issuance of any bonds or notes under this Section may provide for the creation of, deposits in, and regulation and disposition of sinking fund or reserve accounts relating to those bonds or notes and related agreements. The ordinance authorizing the issuance of any such bonds or notes authorized under this Section 12c may contain provisions for the creation of a separate fund to provide for the payment of principal of and interest on those bonds or notes and related agreements. The ordinance may also provide limitations on the issuance of additional bonds or notes of the Authority.

(f) Bonds or notes issued under this Section 12c shall not constitute an indebtedness of the Regional Transportation Authority, the State of Illinois, or of any other political subdivision of or municipality within the State, except the Authority.

(g) The ordinance of the Chicago Transit Board authorizing the issuance of bonds or notes pursuant to this Section 12c may provide for the appointment of a corporate trustee (which may be any trust company or bank having the powers of a trust company within Illinois) with respect to bonds or notes issued pursuant to this Section 12c. The ordinance shall prescribe the rights, duties, and powers of the trustee to be exercised for the benefit of the Authority and the protection of the owners of bonds or notes issued pursuant to this Section 12c. The ordinance may provide for the trustee to hold in trust, invest and use amounts in funds and accounts created as provided by the ordinance with respect to the bonds or notes in accordance with this Section 12c. The Authority may apply, as it shall determine, any amounts received upon the sale of the bonds or notes to pay any Debt Service on the bonds or notes. The ordinance may provide for a trust indenture to set forth terms of, sources of payment for and security for the bonds and notes.

(h) The State of Illinois pledges to and agrees with the owners of the bonds or notes issued pursuant to Section 12c that the State of Illinois will not limit the powers vested in the Authority by this Act to pledge and assign its revenues and funds as security for the payment of the bonds or notes, or vested in the Regional Transportation Authority by the Regional Transportation Authority Act or this Act, so as to materially impair the payment obligations of the Authority under the terms of any contract made by the Authority with those owners or to materially impair the rights and remedies of those owners until those bonds or notes, together with interest and any redemption premium, and all costs and expenses in connection with any action or proceedings by or on behalf of such owners are fully met and discharged. The Authority is authorized to include these pledges and agreements of the State of Illinois in any contract with owners of bonds or notes issued pursuant to this Section 12c.

(i) For purposes of this Section, "Debt Service" with respect to bonds or notes includes, without limitation, principal (at maturity or upon mandatory redemption), redemption premium, interest, periodic, upfront, and termination payments on Swaps, fees for bond insurance or other credit enhancement, liquidity facilities, the funding of bond or note reserves, bond trustee fees, and all other costs of providing for the security or payment of the bonds or notes.

(j) The Authority shall adopt a procurement program with respect to contracts relating to the following service providers in connection with the issuance of debt for the benefit of the Retirement Plan for Chicago Transit Authority Employees: underwriters, bond counsel, financial advisors, and accountants. The program shall include goals for the payment of not less than 30% of the total dollar value of the fees from these contracts to minority owned businesses and female owned businesses as defined in the Business Enterprise for Minorities, Females, and Persons with Disabilities Act. The Authority shall conduct outreach to minority owned businesses and female owned businesses. Outreach shall include, but is not limited to, advertisements in periodicals and newspapers, mailings, and other appropriate media. The Authority shall submit to the General Assembly a comprehensive report that shall include, at a minimum, the details of the procurement plan, outreach efforts, and the results of the efforts to achieve goals for the payment of fees. The service providers selected by the Authority pursuant to such program shall not be subject to approval by the Regional Transportation Authority, and the Regional Transportation Authority's approval pursuant to subsection (e) of this Section 12c related to the issuance of debt shall not be based in any way on the service providers selected by the Authority pursuant to this Section.

(k) No person holding an elective office in this State, holding a seat in the General Assembly, serving as a director, trustee, officer, or employee of the Regional Transportation Authority or the Chicago Transit Authority, including the spouse or minor child of that person, may receive a legal, banking, consulting, or other fee related to the issuance of any bond issued by the Chicago Transit Authority pursuant to this Section.

(70 ILCS 3605/15) (from Ch. 111 2/3, par. 315)

Sec. 15. The Authority shall have power to apply for and accept grants and loans from the Federal Government or any agency or instrumentality thereof, from the State, or from any county, municipal corporation or other political subdivision of the State to be used for any of the purposes of the Authority, including, but not by way of limitation, grants and loans in aid of mass transportation and for studies in mass transportation, and may provide matching funds when necessary to qualify for such grants or loans. The Authority may enter into any agreement with the Federal Government, the State, and any county, municipal corporation or other political subdivision of the State in relation to such grants or loans; provided that such agreement does not conflict with any of the provisions of any trust agreement securing the payment of bonds or certificates of the Authority.

The Authority may also accept from the state, or from any county or other political subdivision, or from any municipal corporation, or school district, or school authorities, grants or other funds authorized by law to be paid to the Authority for any of the purposes of this Act.

(Source: Laws 1961, p. 3135.)

(70 ILCS 3605/28a) (from Ch. 111 2/3, par. 328a)

Sec. 28a. (a) The Board may deal with and enter into written contracts with the employees of the Authority through accredited representatives of such employees or representatives of any labor organization authorized to act for such employees, concerning wages, salaries, hours, working conditions and pension or retirement provisions; provided, nothing herein shall be construed to permit hours of labor in excess of those provided by law or to permit working conditions prohibited by law. In case of dispute over wages, salaries, hours, working conditions, or pension or retirement provisions the Board may arbitrate any question or questions and may agree with such accredited representatives or labor organization that the decision of a majority of any arbitration board shall be final, provided each party shall agree in advance to pay half of the expense of such arbitration.

No contract or agreement shall be made with any labor organization, association, group or individual for the employment of members of such organization, association, group or individual for the construction, improvement, maintenance, operation or administration of any property, plant or facilities under the jurisdiction of the Authority, where such organization, association, group or individual denies on the ground of race, creed, color, sex, religion, physical or mental handicap unrelated to ability, or national origin membership and equal opportunities for employment to any citizen of Illinois.

(b)(1) The provisions of this paragraph (b) apply to collective bargaining agreements (including extensions and amendments of existing agreements) entered into on or after January 1, 1984.

(2) The Board shall deal with and enter into written contracts with their employees, through accredited representatives of such employees authorized to act for such employees concerning wages, salaries, hours, working conditions, and pension or retirement provisions about which a collective bargaining agreement has been entered prior to the effective date of this amendatory Act of 1983. Any such agreement of the Authority shall provide that the agreement may be reopened if the amended budget submitted pursuant to Section 2.18a of the Regional Transportation Authority Act is not approved by the Board of the Regional Transportation Authority. The agreement may not include a provision requiring the payment of wage increases based on changes in the Consumer Price Index. The Board shall not have the authority to enter into collective bargaining agreements with respect to inherent management rights, which include such areas of discretion or policy as the functions of the employer, standards of services, its overall budget, the organizational structure and selection of new employees and direction of personnel. Employers, however, shall be required to bargain collectively with regard to policy matters directly affecting wages, hours and terms and conditions of employment, as well as the impact thereon upon request by employee representatives. To preserve the rights of employers and exclusive representatives which have established collective bargaining relationships or negotiated collective bargaining agreements prior to the effective date of this amendatory Act of 1983, employers shall be required to bargain collectively with regard to any matter concerning wages, hours or conditions of employment about which they have bargained prior to the effective date of this amendatory Act of 1983.

(3) The collective bargaining agreement may not include a prohibition on the use of part-time operators on any service operated by or funded by the Board, except where prohibited by federal law.

(4) Within 30 days of the signing of any such collective bargaining agreement, the Board shall determine the costs of each provision of the agreement, prepare an amended budget incorporating the costs of the agreement, and present the amended budget to the Board of the Regional Transportation Authority for its approval under Section 4.11 of the Regional Transportation Act. The Board of the Regional Transportation Authority may approve the amended budget by an affirmative vote of 10 two-thirds of its then Directors. If the budget is not approved by the Board of the Regional Transportation Authority, the agreement may be reopened and its terms may be renegotiated. Any amended budget which may be prepared following renegotiation shall be presented to the Board of the Regional Transportation Authority for its approval in like manner.

(Source: P.A. 83-886.)

(70 ILCS 3605/34) (from Ch. 111 2/3, par. 334)

Sec. 34. Budget and Program. The Authority, subject to the powers of the Regional Transportation Authority in Section 4.11 of the Regional Transportation Authority Act, shall control the finances of the Authority. It shall by ordinance appropriate money to perform the Authority's purposes and provide for payment of debts and expenses of the Authority. Each year the Authority shall prepare and publish a comprehensive annual budget and five-year capital program document, and a financial plan for the 2 years thereafter describing the state of the Authority and presenting for the forthcoming fiscal year and the two following years the Authority's plans for such operations and capital expenditures as it intends to undertake and the means by which it intends to finance them. The proposed budget, and financial plan, and five-year capital program shall be based on the Regional Transportation Authority's estimate of funds to be made available to the Authority by or through the Regional Transportation Authority and shall conform in all respects to the requirements established by the Regional Transportation Authority. The proposed program and budget, financial plan, and five-year capital program shall contain a statement of the funds estimated to be on hand at the beginning of the fiscal year, the funds estimated to be received from all sources for such year and the funds estimated to be on hand at the end of such year. After adoption of the Regional Transportation Authority's first Five-Year Program, as provided in Section 2.01 of the Regional Transportation Authority Act, the proposed program and budget shall specifically identify any respect in which the recommended program deviates from the Regional Transportation Authority's then existing Five-Year Program, giving the reasons for such deviation. The proposed program and budget, financial plan, and five-year capital program shall be available at no cost for public inspection at the Authority's main office and at the Regional Transportation Authority's main office at least 3 weeks prior to any public hearing. Before the proposed budget, and program and financial plan, and five-year capital program are submitted to the Regional Transportation Authority, the Authority shall hold at least one public hearing thereon in each of the counties in which the Authority provides service. All Board members of the Authority shall attend a majority of the public hearings unless reasonable cause is given for their absence. After the public hearings, the Board of the Authority shall hold at least one meeting for consideration of the proposed program and budget with the Cook County Board. After conducting such hearings and holding such meetings and after making such changes in the proposed program and budget, financial plan, and five-year capital program as the Board deems appropriate, it shall adopt an annual budget ordinance at least by November 15th preceding the beginning of each fiscal year. The budget, and program, and financial plan, and five-year capital program shall then be submitted to the Regional Transportation Authority as provided in Section 4.11 of the Regional Transportation Authority Act. In the event that the Board of the Regional Transportation Authority determines that the budget, and program, and financial plan, and five-year capital program do not meet the standards of said Section 4.11, the Board of the Authority shall make such changes as are necessary to meet such requirements and adopt an amended budget ordinance. The amended budget ordinance shall be resubmitted to the Regional Transportation Authority pursuant to said Section 4.11. The ordinance shall appropriate such sums of money as are deemed necessary to defray all necessary expenses and obligations of the Authority, specifying purposes and the objects or programs for which appropriations are made and the amount appropriated for each object or program. Additional appropriations, transfers between items and other changes in such ordinance which do not alter the basis upon which the balanced budget determination was made by the Regional Transportation Authority may be made from time to time by the Board.

The budget shall:

(i) show a balance between (A) anticipated revenues from all sources including operating subsidies and (B) the costs of providing the services specified and of funding any operating deficits or encumbrances incurred in prior periods, including provision for payment when due of principal and interest on outstanding indebtedness;

(ii) show cash balances including the proceeds of any anticipated cash flow borrowing sufficient to pay with reasonable promptness all costs and expenses as incurred;

(iii) provide for a level of fares or charges and operating or administrative costs for the public transportation provided by or subject to the jurisdiction of the Board sufficient to allow the Board to meet its required system generated revenue recovery ratio as determined in accordance with subsection (a) of Section 4.11 of the Regional Transportation Authority Act;

(iv) be based upon and employ assumptions and projections which are reasonable and prudent;

(v) have been prepared in accordance with sound financial practices as determined by the Board of the Regional Transportation Authority; and

(vi) meet such other financial, budgetary, or fiscal requirements that the Board of the Regional Transportation Authority may by rule or regulation establish; and .

(vii) be consistent with the goals and objectives adopted by the Regional Transportation Authority in the Strategic Plan.

The Board shall establish a fiscal operating year. At least thirty days prior to the beginning of the first full fiscal year after the creation of the Authority, and annually thereafter, the Board shall cause to be prepared a tentative budget which shall include all operation and maintenance expense for the ensuing fiscal year. The tentative budget shall be considered by the Board and, subject to any revision and amendments as may be determined, shall be adopted prior to the first day of the ensuing fiscal year as the budget for that year. No expenditures for operations and maintenance in excess of the budget shall be made during any fiscal year except by the affirmative vote of at least five members of the Board. It shall not be necessary to include in the annual budget any statement of necessary expenditures for pensions or retirement annuities, or for interest or principal payments on bonds or certificates, or for capital outlays, but it shall be the duty of the Board to make provision for payment of same from appropriate funds. The Board may not alter its fiscal year without the prior approval of the Board of the Regional Transportation Authority.

(Source: P.A. 87-1249.)

(70 ILCS 3605/46) (from Ch. 111 2/3, par. 346)

Sec. 46. Citizens Advisory Board. The Board shall establish a citizens advisory board composed of 11 residents of those portions of the metropolitan region in which the Authority provides service who have an interest in public transportation, one of whom shall be at least 65 years of age. The members of the advisory board shall be named for 2 year terms, shall select one of their members to serve as chairman and shall serve without compensation. The citizens advisory board shall meet with Board at least quarterly and advise the Board of the impact of its policies and programs on the communities it serves. Appointments to the citizens advisory board should, to the greatest extent possible, reflect the ethnic, cultural, and geographic diversity of all persons residing within the metropolitan region in which the Authority provides service.

(Source: P.A. 87-226.)

(70 ILCS 3605/50 new)

Sec. 50. Disadvantaged Business Enterprise Contracting and Equal Employment Opportunity Programs. The Authority shall, as soon as is practicable but in no event later than two years after the effective date of this amendatory Act of the 95th General Assembly, establish and maintain a disadvantaged business enterprise contracting program designed to ensure non-discrimination in the award and administration of contracts not covered under a federally mandated disadvantaged business enterprise program. The program shall establish narrowly tailored goals for the participation of disadvantaged business enterprises as the Authority determines appropriate. The goals shall be based on demonstrable evidence of the availability of ready, willing, and able disadvantaged business enterprises relative to all businesses ready, willing, and able to participate on the program's contracts. The program shall require the Authority to monitor the progress of the contractors' obligations with respect to the program's goals. Nothing in this program shall conflict with or interfere with the maintenance or operation of, or compliance with, any federally mandated disadvantaged business enterprise program.

The Authority shall establish and maintain a program designed to promote equal employment opportunity. Each year, no later than October 1, the Authority shall report to the General Assembly on the number of employees of the Authority and the number of employees who have designated themselves as members of a minority group and gender.

Each year no later than October 1, and starting no later than the October 1 after the establishment of the disadvantaged business enterprise contracting program, the Authority shall submit a report with respect to such program to the General Assembly. In addition, no later than October 1 of each year, the Authority shall submit a copy of its federally mandated semi-annual Uniform Report of Disadvantaged Business Enterprises Awards or Commitments and Payments to the General Assembly.

Section 50. The Local Mass Transit District Act is amended by changing Section 3.1 as follows:

(70 ILCS 3610/3.1) (from Ch. 111 2/3, par. 353.1)

Sec. 3.1. Also in the manner provided in this Act as amended, a "Local Mass Transit District" may be created with boundary to enclose a unit area of contiguous land, to be known as the "participating area". Such a "participating area" may be organized as a district under this Act without regard to boundaries of counties or other political subdivisions or municipal corporations.

(a) Any 500 or more legal voters who are residents within such "participating area" may file a petition in the circuit court of the county where the proposed district or a major part thereof is located, asking that the question of creating such district be submitted under this Act by referendum to the voters residing within the proposed district. By their power of attorney signed by them and filed in the cause the petitioners may authorize a committee of their number named by the petitioners, to conduct and pursue the cause for them to a conclusion. Such petition shall define the boundaries of the proposed district, shall indicate distances to nearest mass transportation lines in each direction, naming them, shall have attached a fair map of the proposed district, and shall suggest a name for the proposed district.

(b) The circuit clerk shall present to the circuit judge any petition so filed in the court. The judge shall enter an order of record to set a date, hour and place for judicial hearing on the petition. That order shall include instructions to the circuit clerk to give notice by newspaper publication to be made and completed at least 20 days before the hearing is to be held, in 2 or more newspapers published or circulating generally among the people residing within the proposed district. The circuit clerk shall prepare that notice and cause such publication notice to be given as directed.

(c) After proof of such newspaper publication of notice has been made and filed in the cause and shown to the court in full accord with the prior order, the circuit judge shall hear all persons who attend and so request, as to location and boundary and name for the proposed district. After the hearing on such petition is completed, the circuit court by an order of record, shall determine and establish the location, name and boundary for such proposed district, and shall order the proposition submitted at an election in accordance with the general election law to the voters resident within such proposed district. The circuit clerk shall certify the proposition to the proper election officials who shall submit the proposition in accordance with the general election law.

(d) The county clerk shall canvass the ballots and other returns from such referendum, and prepare a full certification of the result and shall file same in the cause pending in the circuit court. When the vote is in favor of the creation of such district as determined by the court order, a true map of such district shall be filed with such report in the circuit court.

(e) When the vote is in favor of creation of such district, the circuit court by an order of record shall confirm the result of election. If the district is wholly contained within a single county the presiding officer of the county board with the advice and consent of the county board shall appoint 5 trustees, not more than 3 of whom shall be affiliated with the same political party, to govern the district and serve one each for 1, 2, 3, 4 and 5 years respectively; upon the expiration of the term of a trustee who is in office on the effective date of this amendatory Act of 1989, the successor shall, at the time of the appointment, and thereafter at all times while serving as trustee, be a resident of the Mass Transit District for which such person is appointed as trustee. If a trustee removes his residence to a place outside of the District, a trustee shall be appointed in the same manner as herein provided to take the place of the trustee who so removed his residence. If however the district is located in more than one county, the number of trustees who are residents of a county shall be in proportion, as nearly as practicable, to the number of residents of the district who reside in that county in relation to the total population of the district.

Upon the expiration of the term of a trustee who is in office on the effective date of this amendatory Act of 1975, the successor shall be a resident of whichever county is entitled to such representation in order to bring about the proportional representation required herein, and he shall be appointed by the county board of that county, or in the case of a home rule county as defined by Article VII, Section 6 of the Constitution of 1970, the chief executive officer of that county, with the advice and consent of the county board in accordance with the provisions previously enumerated. Successors shall serve 5 year overlapping terms.

Thereafter, each trustee shall be succeeded by a resident of the same county who shall be appointed by the same appointing authority; however, the provisions of the preceding paragraph shall apply to the appointment of the successor to each trustee who is in office at the time of the publication of each decennial Federal census of population.

(f) Upon the creation of such district, the circuit clerk shall prepare and certify a copy of the final court order confirming the referendum creating the district, and a duplicate of the map of such district, from the record of the circuit court, and shall file the same with the county clerk for recording in his office as "Certificate of Incorporation" for the district. The county clerk shall cause a duplicate of such "Certificate of Incorporation" to be filed in the office of the Secretary of State of Illinois.

(g) The Board of Trustees of such "Local Mass Transit District" shall have and exercise all the powers and shall perform all the duties of any Board of Trustees of any district created under this Act, as now or hereafter amended.

(h) The circuit court shall require the petitioners to post a surety bond for the payment of all costs and expenses of such proceeding and such referendum. When a district is created, the circuit court shall order the district to pay or reimburse others for all such costs and expenses. The surety bond shall not be released until complete receipts for all such costs and expenses have been filed in the cause and fully audited by the circuit and county clerks.

(i) If the District is wholly contained within a single county, the County Board of such county may, by resolution, provide that, effective upon the next appointment of a Trustee, after the effective date of this amendatory Act of 1989, that the Board of Trustees of such Mass Transit District shall be comprised of 7 Trustees, with no more than 4 members of the same political party. This Subsection shall not apply to any Mass Transit District in the State which receives funding in whole or in part from the Regional Transportation Authority or any of its service boards.

(j) The Board of a district that is in existence on the effective date of this amendatory Act of the 95th General Assembly and whose participating area: (i) is entirely within a single county; and (ii) when created, was defined by township boundaries may, by an ordinance adopted by the affirmative vote of a majority of the members of the Board and approved by referendum, provide that the participating area of the district be coterminous and expand with the boundaries of the townships that originally established the district's participating area. The ordinance shall not be effective until it has been submitted by referendum to, and approved by, the legal voters of the district and the area within the township that is not within the district. The Board shall certify its ordinance and the proposition to the proper election officials, who shall submit the question to the voters at the next election in accordance with the general election law. The proposition shall be in substantially the following form:

"Shall the boundaries of (local mass transit district) be coterminous and expand with the boundaries of (townships)?"

Votes shall be recorded as "Yes" or "No". If a majority of the electors voting on the question vote in the affirmative, then the district shall be entitled to make its boundaries coterminous with the boundaries of the townships regardless of when the district was formed. The district's boundaries shall encompass all areas located within the townships at the time the ordinance becomes effective and all areas that become part of the townships at a future date. Nothing in this subsection shall allow expansion of a district into an area that is already a part of another local mass transit district.

(Source: P.A. 86-472.)

Section 55. The Regional Transportation Authority Act is amended by changing Sections 1.02, 2.01, 2.04, 2.05, 2.09, 2.12, 2.14, 2.18a, 2.30, 3.01, 3.03, 3A.10, 3A.11, 3A.14, 3B.02, 3B.03, 3B.05, 3B.07, 3B.09, 3B.10, 3B.11, 3B.12, 3B.13, 4.01, 4.02, 4.02a, 4.02b, 4.03, 4.04, 4.09, 4.11, 4.13, 4.14, and 5.01 and by adding Section 2.01a, 2.01b, 2.01c, 2.01d, 2.01e, 2.12b, and 2.31 as follows:

(70 ILCS 3615/1.02) (from Ch. 111 2/3, par. 701.02)

Sec. 1.02. Findings and Purpose. (a) The General Assembly finds;

(i) Public transportation is, as provided in Section 7 of Article XIII of the Illinois Constitution, an essential public purpose for which public funds may be expended and that Section authorizes the State to provide financial assistance to units of local government for distribution to providers of public transportation. There is an urgent need to reform and continue a unit of local government to assure the proper management of public transportation and to receive and distribute State or federal operating assistance and to raise and distribute revenues for local operating assistance. System generated revenues are not adequate for such service and a public need exists to provide for, aid and assist public transportation in the northeastern area of the State, consisting of Cook, DuPage, Kane, Lake, McHenry and Will Counties.

(ii) Comprehensive and coordinated regional public transportation is essential to the public health, safety and welfare. It is essential to economic well-being, maintenance of full employment, conservation of sources of energy and land for open space and reduction of traffic congestion and for providing and maintaining a healthful environment for the benefit of present and future generations in the metropolitan region. Public transportation improves the mobility of the public and improves access to jobs, commercial facilities, schools and cultural attractions. Public transportation decreases air pollution and other environmental hazards resulting from excessive use of automobiles and allows for more efficient land use and planning.

(iii) Because system generated receipts are not presently adequate, public transportation facilities and services in the northeastern area are in grave financial condition. With existing methods of financing, coordination and management, and relative convenience of automobiles, such public transportation facilities are not providing adequate public transportation to insure the public health, safety and welfare.

(iv) Additional commitments to the special public transportation needs problems of the disabled handicapped, the economically disadvantaged, and the elderly are necessary.

(v) To solve these problems, it is necessary to provide for the creation of a regional transportation authority with the powers necessary to insure adequate public transportation.

(b) The General Assembly further finds, in connection with this amendatory Act of 1983:

(i) Substantial, recurring deficits in the operations of public transportation services subject to the jurisdiction of the Regional Transportation Authority and periodic cash shortages have occurred either of which could bring about a loss of public transportation services throughout the metropolitan region at any time;

(ii) A substantial or total loss of public transportation services or any segment thereof would create an emergency threatening the safety and well-being of the people in the northeastern area of the State; and

(iii) To meet the urgent needs of the people of the metropolitan region that such an emergency be averted and to provide financially sound methods of managing the provision of public transportation services in the northeastern area of the State, it is necessary, while maintaining and continuing the existing Authority, to modify the powers and responsibilities of the Authority, to reallocate responsibility for operating decisions, to change the composition and appointment of the Board of Directors thereof, and to immediately establish a new Board of Directors.

(c) The General Assembly further finds in connection with this amendatory Act of the 95th General Assembly:

(i) The economic vitality of northeastern Illinois requires regionwide and systemwide efforts to increase ridership on the transit systems, constrain road congestion within the metropolitan region, and allocate resources for transportation so as to assist in the development of an adequate, efficient, and coordinated regional transportation system that is in a state of good repair.

(ii) To achieve the purposes of this amendatory Act of the 95th General Assembly, the powers and duties of the Authority must be enhanced to improve overall planning and coordination, to achieve an integrated and efficient regional transit system, to advance the mobility of transit users, and to increase financial transparency of the Authority and the Service Boards.

(d) (c) It is the purpose of this Act to provide for, aid and assist public transportation in the northeastern area of the State without impairing the overall quality of existing public transportation by providing for the creation of a single authority responsive to the people and elected officials of the area and with the power and competence to develop, implement, and enforce plans that promote adequate, efficient, and coordinated public transportation, provide financial review of the providers of public transportation in the metropolitan region and facilitate public transportation provided by Service Boards which is attractive and economical to users, comprehensive, coordinated among its various elements, economical, safe, efficient and coordinated with area and State plans.

(Source: P.A. 83-885; 83-886.)

(70 ILCS 3615/2.01) (from Ch. 111 2/3, par. 702.01)

Sec. 2.01. General Allocation of Responsibility for Public Transportation. Provision of Public Transportation - Review and Program.

(a) In order to accomplish the its purposes as set forth in this Act, the responsibility for planning, operating, and funding public transportation in the metropolitan region shall be allocated as described in this Act. The Authority shall:

(i) adopt plans that implement the public policy of the State to provide adequate, efficient, and coordinated public transportation throughout the metropolitan region;

(ii) set goals, objectives, and standards for the Authority, the Service Boards, and transportation agencies;

(iii) develop performance measures to inform the public about the extent to which the provision of public transportation in the metropolitan region meets those goals, objectives, and standards;

(iv) allocate operating and capital funds made available to support public transportation in the metropolitan region;

(v) provide financial oversight of the Service Boards; and

(vi) coordinate the provision of public transportation and the investment in public transportation facilities to enhance the integration of public transportation throughout the metropolitan region, all as provided in this Act.

The the Service Boards shall, on a continuing basis determine the level, nature and kind of public transportation which should be provided for the metropolitan region in order to meet the plans, goals, objectives, and standards adopted by the Authority. The Service Boards may provide public transportation by purchasing such service from transportation agencies through purchase of service agreements, by grants to such agencies or by operating such service, all pursuant to this Act and the "Metropolitan Transit Authority Act", as now or hereafter amended. Certain of its actions to implement the responsibilities allocated to the Authority in this subsection (a) shall be taken in 3 public documents adopted by the affirmative vote of at least 12 of its then Directors: A Strategic Plan; a Five-Year Capital Program; and an Annual Budget and Two-Year Financial Plan. The Authority shall establish a policy to provide adequate public transportation throughout the metropolitan region.

(b) The Authority shall subject the operating and capital plans and expenditures of the Service Boards in the metropolitan region with regard to public transportation to continuing review so that the Authority may budget and expend its funds with maximum effectiveness and efficiency. The Authority shall conduct audits of each of the Service Boards no less than every 5 years. Such audits may include management, performance, financial, and infrastructure condition audits. The Authority may conduct management, performance, financial, and infrastructure condition audits of transportation agencies that receive funds from the Authority. The Authority may direct a Service Board to conduct any such audit of a transportation agency that receives funds from such Service Board, and the Service Board shall comply with such request to the extent it has the right to do so. These audits of the Service Boards or transportation agencies may be project or service specific audits to evaluate their achievement of the goals and objectives of that project or service and their compliance with any applicable requirements. Certain of its recommendations in this regard shall be set forth in 2 public documents, the Five-Year Program provided for in this Section and an Annual Budget and Program provided for in Section 4.01.

(c) The Authority shall, in consultation with the Service Boards, each year prepare and, by ordinance, adopt, after public hearings held in each county in the metropolitan region, a Five-Year Program to inform the public and government officials of the Authority's objectives and program for operations and capital development during the forthcoming five-year period. The Five-Year Program shall set forth the standards of service which the public may expect; each Service Board's plans for coordinating routes and service of the various transportation agencies; the anticipated expense of providing public transportation at standards of service then existing and under alternative operating programs; the nature, location and expense of anticipated capital improvements exceeding $250,000, by specific item and by fiscal year; and such demographic and other data developed by planning and other related agencies, as the Authority shall consider pertinent to the Service Boards' decisions as to levels and nature of service, including without limitation the patterns of population density and growth, projected commercial and residential development, environmental factors and the availability of alternative modes of transportation. The Five-Year Program shall be adopted on the affirmative votes of 9 of the then Directors.

(Source: P.A. 83-886.)

(70 ILCS 3615/2.01a new)

Sec. 2.01a. Strategic Plan.

(a) By the affirmative vote of at least 12 of its then Directors, the Authority shall adopt a Strategic Plan, no less than every 5 years, after consultation with the Service Boards and after holding a minimum of 3 public hearings in Cook County and one public hearing in each of the other counties in the region. The Executive Director of the Authority shall review the Strategic Plan on an ongoing basis and make recommendations to the Board of the Authority with respect to any update or amendment of the Strategic Plan. The Strategic Plan shall describe the specific actions to be taken by the Authority and the Service Boards to provide adequate, efficient, and coordinated public transportation.

(b) The Strategic Plan shall identify goals and objectives with respect to:

(i) increasing ridership and passenger miles on public transportation funded by the Authority;

(ii) coordination of public transportation services and the investment in public transportation facilities to enhance the integration of public transportation throughout the metropolitan region;

(iii) coordination of fare and transfer policies to promote transfers by riders among Service Boards, transportation agencies, and public transportation modes, which may include goals and objectives for development of a universal fare instrument that riders may use interchangeably on all public transportation funded by the Authority, and methods to be used to allocate revenues from transfers;

(iv) improvements in public transportation facilities to bring those facilities into a state of good repair, enhancements that attract ridership and improve customer service, and expansions needed to serve areas with sufficient demand for public transportation;

(v) access for transit-dependent populations, including access by low-income communities to places of employment, utilizing analyses provided by the Chicago Metropolitan Agency for Planning regarding employment and transportation availability, and giving consideration to the location of employment centers in each county and the availability of public transportation at off-peak hours and on weekends;

(vi) the financial viability of the public transportation system, including both operating and capital programs;

(vii) limiting road congestion within the metropolitan region and enhancing transit options to improve mobility; and

(viii) such other goals and objectives that advance the policy of the State to provide adequate, efficient, and coordinated public transportation in the metropolitan region.

(c) The Strategic Plan shall establish the process and criteria by which proposals for capital improvements by a Service Board or a transportation agency will be evaluated by the Authority for inclusion in the Five-Year Capital Program, which may include criteria for:

(i) allocating funds among maintenance, enhancement, and expansion improvements;

(ii) projects to be funded from the Innovation, Coordination, and Enhancement Fund;

(iii) projects intended to improve or enhance ridership or customer service;

(iv) design and location of station or transit improvements intended to promote transfers, increase ridership, and support transit-oriented land development;

(v) assessing the impact of projects on the ability to operate and maintain the existing transit system; and

(vi) other criteria that advance the goals and objectives of the Strategic Plan.

(d) The Strategic Plan shall establish performance standards and measurements regarding the adequacy, efficiency, and coordination of public transportation services in the region and the implementation of the goals and objectives in the Strategic Plan. At a minimum, such standards and measures shall include customer-related performance data measured by line, route, or sub-region, as determined by the Authority, on the following:

(i) travel times and on-time performance;

(ii) ridership data;

(iii) equipment failure rates;

(iv) employee and customer safety; and

(v) customer satisfaction.

The Service Boards and transportation agencies that receive funding from the Authority or Service Boards shall prepare, publish, and submit to the Authority such reports with regard to these standards and measurements in the frequency and form required by the Authority; however, the frequency of such reporting shall be no less than annual. The Service Boards shall publish such reports on their respective websites. The Authority shall compile and publish such reports on its website. Such performance standards and measures shall not be used as the basis for disciplinary action against any employee of the Authority or Service Boards, except to the extent the employment and disciplinary practices of the Authority or Service Board provide for such action.

(e) The Strategic Plan shall identify innovations to improve the delivery of public transportation and the construction of public transportation facilities.

(f) The Strategic Plan shall describe the expected financial condition of public transportation in the metropolitan region prospectively over a 10-year period, which may include information about the cash position and all known obligations of the Authority and the Service Boards including operating expenditures, debt service, contributions for payment of pension and other post-employment benefits, the expected revenues from fares, tax receipts, grants from the federal, State, and local governments for operating and capital purposes and issuance of debt, the availability of working capital, and the resources needed to achieve the goals and objectives described in the Strategic Plan.

(g) In developing the Strategic Plan, the Authority shall rely on such demographic and other data, forecasts, and assumptions developed by the Chicago Metropolitan Agency for Planning with respect to the patterns of population density and growth, projected commercial and residential development, and environmental factors, within the metropolitan region and in areas outside the metropolitan region that may impact public transportation utilization in the metropolitan region. Before adopting or amending any Strategic Plan, the Authority shall consult with the Chicago Metropolitan Agency for Planning regarding the consistency of the Strategic Plan with the Regional Comprehensive Plan adopted pursuant to the Regional Planning Act.

(h) The Authority may adopt, by the affirmative vote of at least 12 of its then Directors, sub-regional or corridor plans for specific geographic areas of the metropolitan region in order to improve the adequacy, efficiency, and coordination of existing, or the delivery of new, public transportation. Such plans may also address areas outside the metropolitan region that may impact public transportation utilization in the metropolitan region. In preparing a sub-regional or corridor plan, the Authority may identify changes in operating practices or capital investment in the sub-region or corridor that could increase ridership, reduce costs, improve coordination, or enhance transit-oriented development. The Authority shall consult with any affected Service Boards in the preparation of any sub-regional or corridor plans.

(i) If the Authority determines, by the affirmative vote of at least 12 of its then Directors, that, with respect to any proposed new public transportation service or facility, (i) multiple Service Boards or transportation agencies are potential service providers and (ii) the public transportation facilities to be constructed or purchased to provide that service have an expected construction cost of more than $25,000,000, the Authority shall have sole responsibility for conducting any alternatives analysis and preliminary environmental assessment required by federal or State law. Nothing in this subparagraph (i) shall prohibit a Service Board from undertaking alternatives analysis and preliminary environmental assessment for any public transportation service or facility identified in items (i) and (ii) above that is included in the Five-Year Capital Program as of the effective date of this amendatory Act of the 95th General Assembly; however, any expenditure related to any such public transportation service or facility must be included in a Five-Year Capital Program under the requirements of Sections 2.01b and 4.02 of this Act.

(70 ILCS 3615/2.01b new)

Sec. 2.01b. The Five-Year Capital Program. By the affirmative vote of at least 12 of its then Directors, the Authority, after consultation with the Service Boards and after holding a minimum of 3 public hearings in Cook County and one public hearing in each of the other counties in the metropolitan region, shall each year adopt a Five-Year Capital Program that shall include each capital improvement to be undertaken by or on behalf of a Service Board provided that the Authority finds that the improvement meets any criteria for capital improvements contained in the Strategic Plan, is not inconsistent with any sub-regional or corridor plan adopted by the Authority, and can be funded within amounts available with respect to the capital and operating costs of such improvement. In reviewing proposals for improvements to be included in a Five-Year Capital Program, the Authority may give priority to improvements that are intended to bring public transportation facilities into a state of good repair. The Five-Year Capital Program shall also identify capital improvements to be undertaken by a Service Board, a transportation agency, or a unit of local government and funded by the Authority from amounts in the Innovation, Coordination, and Enhancement Fund, provided that no improvement that is included in the Five-Year Capital Program as of the effective date of this amendatory Act of the 95th General Assembly may receive funding from the Innovation, Coordination, and Enhancement Fund. Before adopting a Five-Year Capital Program, the Authority shall consult with the Chicago Metropolitan Agency for Planning regarding the consistency of the Five-Year Capital Program with the Regional Comprehensive Plan adopted pursuant to the Regional Planning Act.

(70 ILCS 3615/2.01c new)

Sec. 2.01c. Innovation, Coordination, and Enhancement Fund.

(a) The Authority shall establish an Innovation, Coordination, and Enhancement Fund and each year deposit into the Fund the amounts directed by Section 6z-69 of the State Finance Act. Amounts on deposit in such Fund and interest and other earnings on those amounts may be used by the Authority, upon the affirmative vote of 12 of its then Directors, and after a public participation process, for operating or capital grants or loans to Service Boards, transportation agencies, or units of local government that advance the goals and objectives identified by the Authority in its Strategic Plan, provided that no improvement that has been included in a Five-Year Capital Program as of the effective date of this amendatory Act of the 95th General Assembly may receive any funding from the Innovation, Coordination, and Enhancement Fund. Unless the Board has determined by a vote of 12 of its then Directors that an emergency exists requiring the use of some or all of the funds then in the Innovation, Coordination, and Enhancement Fund, such funds may only be used to enhance the coordination and integration of public transportation and develop and implement innovations to improve the quality and delivery of public transportation.

(b) Any grantee that receives funds from the Innovation, Coordination, and Enhancement Fund for the operation of eligible programs must (i) implement such programs within one year of receipt of such funds and (ii) within 2 years following commencement of any program utilizing such funds, determine whether it is desirable to continue the program, and upon such a determination, either incorporate such program into its annual operating budget and capital program or discontinue such program. No additional funds from the Innovation, Coordination, and Enhancement Fund may be distributed to a grantee for any individual program beyond 2 years unless the Authority by the affirmative vote of at least 12 of its then Directors waives this limitation. Any such waiver will be with regard to an individual program and with regard to a one year-period, and any further waivers for such individual program require a subsequent vote of the Board.

(70 ILCS 3615/2.01d new)

Sec. 2.01d. ADA Paratransit Fund. The Authority shall establish an ADA Paratransit Fund and, each year, deposit into that Fund the amounts directed by Section 6z-69 of the State Finance Act. The amounts on deposit in the Fund and interest and other earnings on those amounts shall be used by the Authority to make grants to the Suburban Bus Board for ADA paratransit services provided pursuant to plans approved by the Authority under Section 2.30 of this Act. Funds received by the Suburban Bus Board from the Authority's ADA Paratransit Fund shall be used only to provide ADA paratransit services to individuals who are determined to be eligible for such services by the Authority under the Americans with Disabilities Act of 1990 and its implementing regulations. Revenues from and costs of services provided by the Suburban Bus Board with grants made under this Section shall be included in the Annual Budget and Two-Year Financial Program of the Suburban Bus Board and shall be subject to all budgetary and financial requirements under this Act that apply to ADA paratransit services. Beginning in 2008, the Executive Director shall, no later than August 15 of each year, provide to the Board a written determination of the projected annual costs of ADA paratransit services that are required to be provided pursuant to the Americans with Disabilities Act of 1990 and its implementing regulations. The Authority shall conduct triennial financial, compliance, and performance audits of ADA paratransit services to assist in this determination.

(70 ILCS 3615/2.01e new)

Sec. 2.01e. Suburban Community Mobility Fund. The Authority shall establish a Suburban Community Mobility Fund and, each year, deposit into that Fund the amounts directed by Section 6z-69 of the State Finance Act. The amounts on deposit in the Fund and interest and other earnings on those amounts shall be used by the Authority to make grants to the Suburban Bus Board for the purpose of operating transit services, other than traditional fixed-route services, that enhance suburban mobility, including, but not limited to, demand-responsive transit services, ride sharing, van pooling, service coordination, centralized dispatching and call taking, reverse commuting, service restructuring, and bus rapid transit. Using funding it receives from the Authority from the Suburban Community Mobility Fund, the Suburban Bus Board shall make an annual grant of $250,000 to the Intertownship Transportation Program for Northwest Suburban Cook County for the purpose of providing transportation services. Revenues from and costs of services provided by the Suburban Bus Board with moneys from the Suburban Community Mobility Fund shall be included in the Annual Budget and Two-Year Financial Program of the Suburban Bus Board and shall be subject to all budgetary and financial requirements under this Act.

(70 ILCS 3615/2.04) (from Ch. 111 2/3, par. 702.04)

Sec. 2.04. Fares and Nature of Service.

(a) Whenever a Service Board provides any public transportation by operating public transportation facilities, the Service Board shall provide for the level and nature of fares or charges to be made for such services, and the nature and standards of public transportation to be so provided that meet the goals and objectives adopted by the Authority in the Strategic Plan. Provided, however that if the Board adopts a budget and financial plan for a Service Board in accordance with the provisions in Section 4.11(b)(5), the Board may consistent with the terms of any purchase of service contract provide for the level and nature of fares to be made for such services under the jurisdiction of that Service Board, and the nature and standards of public transportation to be so provided.

(b) Whenever a Service Board provides any public transportation pursuant to grants made after June 30, 1975, to transportation agencies for operating expenses (other than with regard to experimental programs) or pursuant to any purchase of service agreement, the purchase of service agreement or grant contract shall provide for the level and nature of fares or charges to be made for such services, and the nature and standards of public transportation to be so provided. A Service Board shall require all transportation agencies with which it contracts, or from which it purchases transportation services or to which it makes grants to provide half fare transportation for their student riders if any of such agencies provide for half fare transportation to their student riders.

(c) In so providing for the fares or charges and the nature and standards of public transportation, any purchase of service agreements or grant contracts shall provide, among other matters, for the terms or cost of transfers or interconnections between different modes of transportation and different public transportation agencies, schedules or routes of such service, changes which may be made in such service, the nature and condition of the facilities used in providing service, the manner of collection and disposition of fares or charges, the records and reports to be kept and made concerning such service, and for interchangeable tickets or other coordinated or uniform methods of collection of charges, and shall further require that the transportation agency comply with any determination made by the Board of the Authority under and subject to the provisions of Section 2.12b of this Act. In regard to any such service, the Authority and the Service Boards shall give attention to and may undertake programs to promote use of public transportation and to provide coordinated ticket sales and passenger information. In the case of a grant to a transportation agency which remains subject to Illinois Commerce Commission supervision and regulation, the Service Boards shall exercise the powers set forth in this Section in a manner consistent with such supervision and regulation by the Illinois Commerce Commission.

(Source: P.A. 83-886.)

(70 ILCS 3615/2.05) (from Ch. 111 2/3, par. 702.05)

Sec. 2.05. Centralized Services; Acquisition and Construction.

(a) The Authority may at the request of two or more Service Boards, serve, or designate a Service Board to serve, as a centralized purchasing agent for the Service Boards so requesting.

(b) The Authority may at the request of two or more Service Boards perform other centralized services such as ridership information and transfers between services under the jurisdiction of the Service Boards where such centralized services financially benefit the region as a whole. Provided, however, that the Board may require transfers only upon an affirmative vote of 10 9 of its then Directors.

(c) A Service Board or the Authority may for the benefit of a Service Board, to meet its purposes, construct or acquire any public transportation facility for use by a Service Board or for use by any transportation agency and may acquire any such facilities from any transportation agency, including also without limitation any reserve funds, employees' pension or retirement funds, special funds, franchises, licenses, patents, permits and papers, documents and records of the agency. In connection with any such acquisition from a transportation agency the Authority may assume obligations of the transportation agency with regard to such facilities or property or public transportation operations of such agency.

In connection with any construction or acquisition, the Authority shall make relocation payments as may be required by federal law or by the requirements of any federal agency authorized to administer any federal program of aid.

(d) The Authority shall, after consulting with the Service Boards, develop regionally coordinated and consolidated sales, marketing, advertising, and public information programs that promote the use and coordination of, and transfers among, public transportation services in the metropolitan region. The Authority shall develop and adopt, with the affirmative vote of at least 12 of its then Directors, rules and regulations for the Authority and the Service Boards regarding such programs to ensure that the Service Boards' independent programs conform with the Authority's regional programs.

(Source: P.A. 83-886.)

(70 ILCS 3615/2.09) (from Ch. 111 2/3, par. 702.09)

Sec. 2.09. Research and Development.

(a) The Authority and the Service Boards shall study public transportation problems and developments; encourage experimentation in developing new public transportation technology, financing methods, and management procedures; conduct, in cooperation with other public and private agencies, studies and demonstration and development projects to test and develop methods for improving public transportation, for reducing its costs to users or for increasing public use; and conduct, sponsor, and participate in other studies and experiments, which may include fare demonstration programs, useful to achieving the purposes of this Act. The cost for any such item authorized by this Section may be exempted by the Board in a budget ordinance from the "costs" included in determining that the Authority and its service boards meet the farebox recovery ratio or system generated revenues recovery ratio requirements of Sections 3A.10, 3B.10, 4.01(b), 4.09 and 4.11 of this Act and Section 34 of the Metropolitan Transit Authority Act during the Authority's fiscal year which begins January 1, 1986 and ends December 31, 1986, provided that the cost of any item authorized herein must be specifically approved within the budget adopted pursuant to Sections 4.01 and 4.11 of this Act for that fiscal year.

(b) To improve public transportation service in areas of the metropolitan region with limited access to commuter rail service, the Authority and the Suburban Bus Division shall evaluate the feasibility of implementing new bus rapid transit services using the expressway and tollway systems in the metropolitan region. The Illinois Department of Transportation and the Illinois Toll Highway Authority shall work cooperatively with the Authority and the Suburban Bus Division in that evaluation and in the implementation of bus rapid transit services. The Authority and the Suburban Bus Division, in cooperation with the Illinois Department of Transportation, shall develop a bus rapid transit demonstration project on Interstate 55 located in Will, DuPage, and Cook counties. This demonstration project shall test and refine approaches to bus rapid transit operations in the expressway or tollway shoulder or regular travel lanes and shall investigate technology options that facilitate the shared use of the transit lane and provide revenue for financing construction and operation of public transportation facilities.

(c) The Suburban Bus Division and the Authority shall cooperate in the development, funding, and operation of programs to enhance access to job markets for residents in south suburban Cook County. Beginning in 2008, the Authority shall allocate to the Suburban Bus Division an amount not less than $7,500,000 annually for the costs of such programs.

(Source: P.A. 84-939.)

(70 ILCS 3615/2.12) (from Ch. 111 2/3, par. 702.12)

Sec. 2.12. Coordination with Planning Agencies. The Authority and the Service Boards shall cooperate with the various public agencies charged with responsibility for long-range or comprehensive planning for the metropolitan region. The Authority shall utilize the official forecasts and plans of the Chicago Metropolitan Agency for Planning in developing the Strategic Plan and the Five-Year Capital Program. The Authority and the Service Boards shall, prior to the adoption of any Strategic Plan, as provided in Section 2.01a of this Act, or the adoption of any Five-Year Capital Program, as provided in paragraph (b) of Section 2.01b 2.01 of this Act, submit its proposals to such agencies for review and comment. The Authority and the Service Boards may make use of existing studies, surveys, plans, data and other materials in the possession of any State agency or department, any planning agency or any unit of local government.

(Source: P.A. 83-886.)

(70 ILCS 3615/2.12b new)

Sec. 2.12b. Coordination of Fares and Service. Upon the request of a Service Board, the Executive Director of the Authority may, upon the affirmative vote of 10 of the then Directors of the Authority, intervene in any matter involving (i) a dispute between Service Boards or a Service Board and a transportation agency providing service on behalf of a Service Board with respect to the terms of transfer between, and the allocation of revenues from fares and charges for, transportation services provided by the parties or (ii) a dispute between 2 Service Boards with respect to coordination of service, route duplication, or a change in service. Any Service Board or transportation agency involved in such dispute shall meet with the Executive Director, cooperate in good faith to attempt to resolve the dispute, and provide any books, records, and other information requested by the Executive Director. If the Executive Director is unable to mediate a resolution of any dispute, he or she may provide a written determination recommending a change in the fares or charges or the allocation of revenues for such service or directing a change in the nature or provider of service that is the subject of the dispute. The Executive Director shall base such determination upon the goals and objectives of the Strategic Plan established pursuant to Section 2.01a(b). Such determination shall be presented to the Board of the Authority and, if approved by the affirmative vote of at least 7 of the then Directors of the Authority, shall be final and shall be implemented by any affected Service Board and transportation agency within the time frame required by the determination.

(70 ILCS 3615/2.14) (from Ch. 111 2/3, par. 702.14)

Sec. 2.14. Appointment of Officers and Employees. The Authority may appoint, retain and employ officers, attorneys, agents, engineers and employees. The officers shall include an Executive Director, who shall be the chief executive officer of the Authority, appointed by the Chairman with the concurrence of 9 of the other then Directors of the Board. The Executive Director shall organize the staff of the Authority, shall allocate their functions and duties, shall transfer such staff to the Suburban Bus Division and the Commuter Rail Division as is sufficient to meet their purposes, shall fix compensation and conditions of employment of the staff of the Authority, and consistent with the policies of and direction from the Board, take all actions necessary to achieve its purposes, fulfill its responsibilities and carry out its powers, and shall have such other powers and responsibilities as the Board shall determine. The Executive Director must be an individual of proven transportation and management skills and may not be a member of the Board. The Authority may employ its own professional management personnel to provide professional and technical expertise concerning its purposes and powers and to assist it in assessing the performance of the Service Boards in the metropolitan region.

No unlawful discrimination, as defined and prohibited in the Illinois Human Rights Act, shall be made in any term or aspect of employment nor shall there be discrimination based upon political reasons or factors. The Authority shall establish regulations to insure that its discharges shall not be arbitrary and that hiring and promotion are based on merit.

The Authority shall be subject to the "Illinois Human Rights Act", as now or hereafter amended, and the remedies and procedure established thereunder. The Authority shall file an affirmative action program for employment by it with the Department of Human Rights to ensure that applicants are employed and that employees are treated during employment, without regard to unlawful discrimination. Such affirmative action program shall include provisions relating to hiring, upgrading, demotion, transfer, recruitment, recruitment advertising, selection for training and rates of pay or other forms of compensation.

(Source: P.A. 83-886.)

(70 ILCS 3615/2.18a) (from Ch. 111 2/3, par. 702.18a)

Sec. 2.18a. (a) The provisions of this Section apply to collective bargaining agreements (including extensions and amendments to existing agreements) between Service Boards or transportation agencies subject to the jurisdiction of Service Boards and their employees, which are entered into after January 1, 1984.

(b) The Authority shall approve amended budgets prepared by Service Boards which incorporate the costs of collective bargaining agreements between Service Boards and their employees. The Authority shall approve such an amended budget provided that it determines by the affirmative vote of 12 9 of its then members that the amended budget meets the standards established in Section 4.11.

(Source: P.A. 83-886.)

(70 ILCS 3615/2.30)

Sec. 2.30. Paratransit services.

(a) For purposes of this Act, "ADA paratransit services" shall mean those comparable or specialized transportation services provided by, or under grant or purchase of service contracts of, the Service Boards to individuals with disabilities who are unable to use fixed route transportation systems and who are determined to be eligible, for some or all of their trips, for such services under the Americans with Disabilities Act of 1990 and its implementing regulations.

(b) Beginning July 1, 2005, the Authority is responsible for the funding, from amounts on deposit in the ADA Paratransit Fund established under Section 2.01d of this Act, financial review and oversight of all ADA paratransit services that are provided by the Authority or by any of the Service Boards. The Suburban Bus Board shall operate or provide for the operation of all ADA paratransit services by no later than July 1, 2006, except that this date may be extended to the extent necessary to obtain approval from the Federal Transit Administration of the plan prepared pursuant to subsection (c).

(c) No later than January 1, 2006, the Authority, in collaboration with the Suburban Bus Board and the Chicago Transit Authority, shall develop a plan for the provision of ADA paratransit services and submit such plan to the Federal Transit Administration for approval. Approval of such plan by the Authority shall require the affirmative votes of 10 9 of the then Directors. The Suburban Bus Board, the Chicago Transit Authority and the Authority shall comply with the requirements of the Americans with Disabilities Act of 1990 and its implementing regulations in developing and approving such plan including, without limitation, consulting with individuals with disabilities and groups representing them in the community, and providing adequate opportunity for public comment and public hearings. The plan shall include the contents required for a paratransit plan pursuant to the Americans with Disabilities Act of 1990 and its implementing regulations. The plan shall also include, without limitation, provisions to:

(1) maintain, at a minimum, the levels of ADA paratransit service that are required to be provided by the Service Boards pursuant to the Americans with Disabilities Act of 1990 and its implementing regulations;

(2) transfer the appropriate ADA paratransit services, management, personnel, service contracts and assets from the Chicago Transit Authority to the Authority or the Suburban Bus Board, as necessary, by no later than July 1, 2006, except that this date may be extended to the extent necessary to obtain approval from the Federal Transit Administration of the plan prepared pursuant to this subsection (c);

(3) provide for consistent policies throughout the metropolitan region for scheduling of ADA paratransit service trips to and from destinations, with consideration of scheduling of return trips on a "will-call" open-ended basis upon request of the rider, if practicable, and with consideration of an increased number of trips available by subscription service than are available as of the effective date of this amendatory Act;

(4) provide that service contracts and rates, entered into or set after the approval by the Federal Transit Administration of the plan prepared pursuant to subsection (c) of this Section, with private carriers and taxicabs for ADA paratransit service are procured by means of an open procurement process;

(5) provide for fares, fare collection and billing procedures for ADA paratransit services throughout the metropolitan region;

(6) provide for performance standards for all ADA paratransit service transportation carriers, with consideration of door-to-door service;

(7) provide, in cooperation with the Illinois Department of Transportation, the Illinois Department of Public Aid and other appropriate public agencies and private entities, for the application and receipt of grants, including, without limitation, reimbursement from Medicaid or other programs for ADA paratransit services;

(8) provide for a system of dispatch of ADA paratransit services transportation carriers throughout the metropolitan region, with consideration of county-based dispatch systems already in place as of the effective date of this amendatory Act;

(9) provide for a process of determining eligibility for ADA paratransit services that complies with the Americans with Disabilities Act of 1990 and its implementing regulations;

(10) provide for consideration of innovative methods to provide and fund ADA paratransit services; and

(11) provide for the creation of one or more ADA advisory boards, or the reconstitution of the existing ADA advisory boards for the Service Boards, to represent the diversity of individuals with disabilities in the metropolitan region and to provide appropriate ongoing input from individuals with disabilities into the operation of ADA paratransit services.

(d) All revisions and annual updates to the ADA paratransit services plan developed pursuant to subsection (c) of this Section, or certifications of continued compliance in lieu of plan updates, that are required to be provided to the Federal Transit Administration shall be developed by the Authority, in collaboration with the Suburban Bus Board and the Chicago Transit Authority, and the Authority shall submit such revision, update or certification to the Federal Transit Administration for approval. Approval of such revisions, updates or certifications by the Authority shall require the affirmative votes of 12 9 of the then Directors.

(e) The Illinois Department of Transportation, the Illinois Department of Public Aid, the Authority, the Suburban Bus Board and the Chicago Transit Authority shall enter into intergovernmental agreements as may be necessary to provide funding and accountability for, and implementation of, the requirements of this Section.

(f) By no later than April 1, 2007, the Authority shall develop and submit to the General Assembly and the Governor a funding plan for ADA paratransit services. Approval of such plan by the Authority shall require the affirmative votes of 12 9 of the then Directors. The funding plan shall, at a minimum, contain an analysis of the current costs of providing ADA paratransit services, projections of the long-term costs of providing ADA paratransit services, identification of and recommendations for possible cost efficiencies in providing ADA paratransit services, and identification of and recommendations for possible funding sources for providing ADA paratransit services. The Illinois Department of Transportation, the Illinois Department of Public Aid, the Suburban Bus Board, the Chicago Transit Authority and other State and local public agencies as appropriate shall cooperate with the Authority in the preparation of such funding plan.

(g) Any funds derived from the federal Medicaid program for reimbursement of the costs of providing ADA paratransit services within the metropolitan region shall be directed to the Authority and shall be used to pay for or reimburse the costs of providing such services.

(h) Nothing in this amendatory Act shall be construed to conflict with the requirements of the Americans with Disabilities Act of 1990 and its implementing regulations.

(Source: P.A. 94-370, eff. 7-29-05.)

(70 ILCS 3615/2.31 new)

Sec. 2.31. Disadvantaged Business Enterprise Contracting and Equal Employment Opportunity Programs. The Authority and each Service Board shall, as soon as is practicable but in no event later than two years after the effective date of this amendatory Act of the 95th General Assembly, establish and maintain a disadvantaged business enterprise contracting program designed to ensure non-discrimination in the award and administration of contracts not covered under a federally mandated disadvantaged business enterprise program. The program shall establish narrowly tailored goals for the participation of disadvantaged business enterprises as the Authority and each Service Board determines appropriate. The goals shall be based on demonstrable evidence of the availability of ready, willing, and able disadvantaged business enterprises relative to all businesses ready, willing, and able to participate on the program's contracts. The program shall require the Authority and each Service Board to monitor the progress of the contractors' obligations with respect to the program's goals. Nothing in this program shall conflict with or interfere with the maintenance or operation of, or compliance with, any federally mandated disadvantaged business enterprise program.

The Authority and each Service Board shall establish and maintain a program designed to promote equal employment opportunity. Each year, no later than October 1, the Authority and each Service Board shall report to the General Assembly on the number of their respective employees and the number of their respective employees who have designated themselves as members of a minority group and gender.

Each year no later than October 1, and starting no later than the October 1 after the establishment of their disadvantaged business enterprise contracting programs, the Authority and each Service Board shall submit a report with respect to such program to the General Assembly. In addition, each year no later than October 1, the Authority and each Service Board shall submit a copy of its federally mandated semi-annual Uniform Report of Disadvantaged Business Enterprises Awards or Commitments and Payments to the General Assembly.

(70 ILCS 3615/3.01) (from Ch. 111 2/3, par. 703.01)

Sec. 3.01. Board of Directors. The Upon expiration of the term of the members of the Transition Board as provided for in Section 3.09, the corporate authorities and governing body of the Authority shall be a Board consisting of 13 Directors until January 1, 2008, and 16 Directors thereafter, appointed as follows:

(a) Four Directors appointed by the Mayor of the City of Chicago, with the advice and consent of the City Council of the City of Chicago, and, only until January 1, 2008, a fifth director who shall be the Chairman of the Chicago Transit Authority. After January 1, 2008, the Mayor of the City of Chicago, with the advice and consent of the City Council of the City of Chicago, shall appoint a fifth Director. The Directors appointed by the Mayor of the City of Chicago shall not be the chairman or a director of the Chicago Transit Authority. Each such Director shall reside in the City of Chicago except the Chairman of the Chicago Transit Authority who shall reside within the metropolitan area as defined in the Metropolitan Transit Authority Act.

(b) Four Directors appointed by the votes of a majority of the members of the Cook County Board elected from that part of Cook County outside of Chicago, or, in the event such Board of Commissioners becomes elected from single member districts, by those Commissioners elected from districts, a majority of the electors of which reside outside Chicago. After January 1, 2008, a fifth Director appointed by the President of the Cook County Board with the advice and consent of a majority of the members of the Cook County Board elected from districts, a majority of the electors of which reside outside Chicago. In either case, such appointment shall be with the concurrence of four such Commissioners. Each such Director appointed under this subparagraph shall reside in that part of Cook County outside Chicago.

(c) Until January 1, 2008, 3 Directors appointed by the Chairmen of the county boards of DuPage, Kane, Lake, McHenry, and Will Counties, as follows:

(i) Two Directors appointed by the Chairmen of the county boards of Kane, Lake, McHenry and Will Counties, with the concurrence of not less than a majority of the Chairmen from such counties, from nominees by the Chairmen. Each such Chairman may nominate not more than 2 persons for each position. Each such Director shall reside in a county in the metropolitan region other than Cook or DuPage Counties.

(ii) (d) One Director shall be appointed by the Chairman of the Board of DuPage County Board with the advice and consent of the County Board of DuPage County Board. Such Director and shall reside in DuPage County.

(d) After January 1, 2008, 5 Directors appointed by the Chairmen of the county boards of DuPage, Kane, Lake and McHenry Counties and the County Executive of Will County, as follows:

(i) One Director appointed by the Chairman of the McHenry County Board with the advice and consent of the McHenry County Board. Such Director shall reside in McHenry County.

(ii) One Director appointed by the County Executive of Will County with the advice and consent of the Will County Board. Such Director shall reside in Will County.

(iii) One Director appointed by the Chairman of the DuPage County Board with the advice and consent of the DuPage County Board. Such Director shall reside in DuPage County.

(iv) One Director appointed by the Chairman of the Lake County Board with the advice and consent of the Lake County Board. Such Director shall reside in Lake County.

(v) One Director appointed by the Chairman of the Kane County Board with the advice and consent of the Kane County Board. Such Director shall reside in Kane County.

(e) The Before January 1, 1987, for the term expiring July 1, 1989, the Chairman shall be appointed by the Governor. Thereafter the Chairman shall be appointed by the other 12 Directors by the affirmative votes of at least 9 of the then with the concurrence of three-fourths of such Directors. Upon the expiration or vacancy of the term of the Chairman then serving upon the effective date of this amendatory Act of the 95th General Assembly, the Chairman shall be appointed by the other Directors, by the affirmative vote of at least 11 of the then Directors, including the affirmative vote of at least 2 Directors appointed under subsection (a) of this Section, at least 2 Directors appointed under subsection (b) of this Section, and at least 2 Directors appointed under subsection (c) or (d) of this Section. The chairman shall not be appointed from among the other Directors. The chairman shall be a resident of the metropolitan region.

(f) Except as otherwise provided by this Act no Director shall, while serving as such, be an officer, a member of the Board of Directors or Trustees or an employee of any Service Board or transportation agency, or be an employee of the State of Illinois or any department or agency thereof, or of any unit of local government or receive any compensation from any elected or appointed office under the Constitution and laws of Illinois; except that a Director may be a member of a school board.

(g) Each appointment made under this Section and under Section 3.03 shall be certified by the appointing authority to the Board, which shall maintain the certifications as part of the official records of the Authority; provided that the initial appointments shall be certified to the Secretary of State, who shall transmit the certifications to the Board following its organization. All appointments made by the Governor shall be made with the advice and consent of the Senate.

(h) (Blank). The Board of Directors shall be so appointed as to represent the City of Chicago, that part of Cook County outside the City of Chicago, and that part of the metropolitan region outside Cook County on the one man one vote basis. After each Federal decennial census the General Assembly shall review the composition of the Board and, if a change is needed to comply with this requirement, shall provide for the necessary revision by July 1 of the third year after such census. Provided, however, that the Chairman of the Chicago Transit Authority shall be a Director of the Authority and shall be considered as representing the City of Chicago for purposes of this paragraph.

Insofar as may be practicable, the changes in Board membership necessary to achieve this purpose shall take effect as appropriate members terms expire, no member's term being reduced by reason of such revision of the composition of the Board.

(Source: P.A. 83-1417.)

(70 ILCS 3615/3.03) (from Ch. 111 2/3, par. 703.03)

Sec. 3.03. Terms, vacancies. Each Director, including the Chairman, shall be appointed for an initial term as provided for in Section 3.10 of this Act. Thereafter, each Director shall hold office for a term of 5 years, and until his successor has been appointed and has qualified. A vacancy shall occur upon resignation, death, conviction of a felony, or removal from office of a Director. Any Director may be removed from office upon concurrence of not less than 9 Directors, on a formal finding of incompetence, neglect of duty, or malfeasance in office. Within 30 days after the office of any member becomes vacant for any reason, the appointing authorities of such member shall make an appointment to fill the vacancy. A vacancy shall be filled for the unexpired term.

Whenever After October 1, 1984, whenever a vacancy for a Director, except as to the Chairman or those Directors appointed by the Governor or the Mayor of the City of Chicago, exists for longer than 4 months, the new Director shall be chosen by election by all legislative members in the General Assembly representing the affected area. In order to qualify as a voting legislative member in this matter, the affected area must be more than 50% of the geographic area of the legislative district.

(Source: P.A. 86-1475.)

(70 ILCS 3615/3A.10) (from Ch. 111 2/3, par. 703A.10)

Sec. 3A.10. Budget and Program. The Suburban Bus Board, subject to the powers of the Authority in Section 4.11, shall control the finances of the Division. It shall by ordinance appropriate money to perform the Division's purposes and provide for payment of debts and expenses of the Division. Each year the Suburban Bus Board shall prepare and publish a comprehensive annual budget and proposed five-year capital program document, and a financial plan for the 2 years thereafter describing the state of the Division and presenting for the forthcoming fiscal year and the 2 following years the Suburban Bus Board's plans for such operations and capital expenditures as it intends to undertake and the means by which it intends to finance them. The proposed budget, and financial plan, and five-year capital program shall be based on the Authority's estimate of funds to be made available to the Suburban Bus Board by or through the Authority and shall conform in all respects to the requirements established by the Authority. The proposed program and budget, financial plan, and five-year capital program shall contain a statement of the funds estimated to be on hand at the beginning of the fiscal year, the funds estimated to be received from all sources for such year and the funds estimated to be on hand at the end of such year. After adoption of the Authority's first Five-Year Program, as provided in Section 2.01 of this Act, the proposed program and budget shall specifically identify any respect in which the recommended program deviates from the Authority's then existing Five-Year Program, giving the reasons for such deviation. The fiscal year of the Division shall be the same as the fiscal year of the Authority. Before the proposed budget, and program and financial plan, and five-year capital program are submitted to the Authority, the Suburban Bus Board shall hold at least one public hearing thereon in each of the counties in the metropolitan region in which the Division provides service. The Suburban Bus Board shall hold at least one meeting for consideration of the proposed program and budget, financial plan, and five-year capital program with the county board of each of the several counties in the metropolitan region in which the Division provides service.