HB4498 99TH GENERAL ASSEMBLY

  
  

 


 
99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB4498

 

Introduced , by Rep. Jim Durkin - Robert W. Pritchard - Ron Sandack

 

SYNOPSIS AS INTRODUCED:
 
10 ILCS 5/9-37 new
105 ILCS 5/2-3.25f-5
105 ILCS 5/34-1  from Ch. 122, par. 34-1
105 ILCS 5/34-3  from Ch. 122, par. 34-3
105 ILCS 5/34-3.6 new
105 ILCS 5/34-4  from Ch. 122, par. 34-4
105 ILCS 5/34-1.05 rep.
30 ILCS 805/8.40 new

    Amends the School Code. Provides that the State Superintendent of Education may remove members of the school board of any school district (currently, only districts with a population of not more than 500,000), and sets criteria for districts with a population of more than 500,000. Provides for the transition to an elected board for districts with a population of more than 500,000. Provides that the removal of appointed board members and the transition to elected board members for districts with a population of more than 500,000 shall not be construed as creating any liability on the part of the State for the debts and obligations of that school district. Restricts the sources of compensation that may be received by board members of districts with a population of more than 500,000. Prohibits political contributions to board members of districts with a population of more than 500,000 by certain businesses. Repeals a Section creating the Chicago Educational Governance Task Force. Amends the Election Code. Prohibits campaign contributions from labor organizations representing teachers and from business entities having contracts with school districts in certain school board elections. Contains a statement of legislative intent. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.


LRB099 18962 JWD 43351 b

 

 

A BILL FOR

 

HB4498LRB099 18962 JWD 43351 b

1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Intent and purpose. At the time of passage of
5this amendatory Act of the 99th General Assembly, the taxpayers
6of Illinois have devoted considerable and disproportionate
7resources to the City of Chicago and to Chicago Public Schools.
8Chicago Public Schools receive more than $600 million per year
9in funding from the State of Illinois through proceeds of the
10corporate personal property replacement tax, early childhood
11education grants, low-income households grants, the Property
12Tax Extension Limitation Law adjustments, and the educational
13services block grant than they would have received if those
14funds were fairly distributed among districts statewide on the
15basis of population or low-income population, as applicable.
16    Although Chicago Public Schools are responsible for paying
17their employer contribution to their teachers' pension fund, if
18the State were to cover the district's normal costs of
19newly-earned pension benefits as it does for other school
20districts, Chicago Public Schools would still receive
21significantly more than their fair share of total State funding
22to school districts.
23    Chicago Public Schools have more flexibility under State
24law to negotiate with their teachers' union than other school

 

 

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1districts. Notwithstanding that flexibility, Chicago Public
2Schools have chosen to exacerbate their unfunded pension burden
3by agreeing with their teachers' union to pay not only the
4employer contribution, but also almost all of the employee
5contribution to the teachers' pension fund.
6    Previously, the General Assembly acted to alleviate the
7short-term burden by granting the Chicago Public Schools a
83-year "pension holiday", with the understanding that the
9district would use that time to make the necessary preparations
10to begin increasing their employer contributions to the pension
11fund. However, instead of becoming adequately prepared,
12Chicago Public Schools is now seeking another pension payment
13holiday or State bailout. Similarly, the City of Chicago has
14not fully planned for its long-anticipated increase in pension
15contributions and now wants to significantly reduce its
16short-term pension contribution requirements. Both Chicago
17Public Schools and the City of Chicago acknowledge they have
18substantial budget deficits in this fiscal year and project
19widening budget gaps for the foreseeable future, but have no
20plan for addressing the deferred debt service payments that
21will cripple the next generation of students and taxpayers. The
22deteriorating financial condition of both Chicago Public
23Schools and the City of Chicago is evidenced by the recent
24rapid decline in their credit ratings to "junk bond" levels.
25    While all local governments and school districts should be
26afforded greater freedom to contain and control their spending,

 

 

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1the City of Chicago and Chicago Public Schools already enjoy
2greater flexibility under the law and more ample resources than
3most other units of local government and school districts
4across Illinois. The State of Illinois must protect Illinois
5taxpayers from the poor financial decisions made by Chicago
6politicians. The General Assembly finds that this Act will lead
7to fiscal stability for the State; and, thus, the State must
8not, directly, indirectly, or contingently, assume any debt or
9liability of, or make any additional payment to or on behalf
10of, the City of Chicago or Chicago Public Schools other than as
11a part of payments made fairly to all municipalities and school
12districts statewide.
 
13    Section 5. The Election Code is amended by adding Section
149-37 as follows:
 
15    (10 ILCS 5/9-37 new)
16    Sec. 9-37. Conflicts of interest in certain school board
17elections.
18    (a) As teachers' salaries and benefits constitute a
19significant amount of a school district's budget and are a key
20component of bargaining between the board of education and
21labor unions representing those teachers, it is the General
22Assembly's finding that an inherent conflict exists between an
23elected member of a board of education and unions representing
24the district's teachers. As such, it is necessary to enact the

 

 

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1following safeguards to ensure no conflicts of interest.
2    (b) As used in this Section:
3    The terms "contract" and "contract with a school district
4subject to Article 34 of the School Code" both mean any
5contract between a business entity and a school district
6subject to Article 34 of the School Code.
7    "Contribution" means a contribution as defined in Section
89-1.4 of the Election Code.
9    "Declared candidate" means a person who has filed a
10statement of candidacy and petition for nomination or election
11to the school board of a school district subject to Article 34
12of the School Code.
13    "Officeholder" means an elected or appointed member of the
14school board of a school district subject to Article 34 of the
15School Code.
16    "Sponsoring entity" means a sponsoring entity as defined in
17Section 9-3 of this Code.
18    "Affiliated person" means (i) any person with any ownership
19interest or distributive share of the bidding or contracting
20business entity in excess of 7.5%, (ii) executive employees of
21the bidding or contracting business entity, and (iii) the
22spouse of any such persons. "Affiliated person" does not
23include a person prohibited by federal law from making
24contributions or expenditures in connection with a federal,
25state, or local election.
26    "Affiliated entity" means (i) any corporate parent and each

 

 

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1operating subsidiary of the bidding or contracting business
2entity, (ii) each operating subsidiary of the corporate parent
3of the bidding or contracting business entity, (iii) any
4organization recognized by the United States Internal Revenue
5Service as a tax-exempt organization described in Section
6501(c) of the Internal Revenue Code of 1986 (or any successor
7provision of federal tax law) established by the bidding or
8contracting business entity, any affiliated entity of that
9business entity, or any affiliated person of that business
10entity, or (iv) any political committee for which the bidding
11or contracting business entity, or any 501(c) organization
12described in item (iii) related to that business entity, is the
13sponsoring entity. "Affiliated entity" does not include an
14entity prohibited by federal law from making contributions or
15expenditures in connection with a federal, state, or local
16election.
17    "Business entity" means any entity doing business for
18profit, whether organized as a corporation, partnership, sole
19proprietorship, limited liability company or partnership, or
20otherwise.
21    "Executive employee" means (i) the president, chairman of
22the board, or chief executive officer of a business entity and
23any other individual that fulfills equivalent duties as the
24president, chairman of the board, or chief executive officer of
25a business entity; and (ii) any employee of a business entity
26whose compensation is determined directly, in whole or in part,

 

 

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1by the award or payment of contracts by the school district
2subject to Article 34 of the School Code to the entity
3employing the employee. A regular salary that is paid
4irrespective of the award or payment of a contract with a
5school district subject to Article 34 of the School Code shall
6not constitute "compensation" under item (ii) of this
7definition. "Executive employee" does not include any person
8prohibited by federal law from making contributions or
9expenditures in connection with a federal, state, or local
10election.
11    (c) Any business entity whose contracts with a school
12district subject to Article 34 of the School Code, in the
13aggregate, annually total more than $50,000, and any affiliated
14entities or affiliated persons of such business entity, are
15prohibited from making any contributions to any political
16committees established to promote the candidacy of (i) a member
17of the school board of a school district subject to Article 34
18of the School Code or (ii) any other declared candidate for
19that office. This prohibition shall be effective for the
20duration of the term of office of the incumbent officeholders
21at the time the contracts were awarded or for a period of 2
22years following the expiration or termination of the contracts,
23whichever is longer.
24    (d) Any business entity whose aggregate pending bids and
25offers on contracts with a school district subject to Article
2634 of the School Code total more than $50,000, or whose

 

 

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1aggregate pending bids and offers on contracts with a school
2district subject to Article 34 of the School Code combined with
3the business entity's aggregate annual total value of contracts
4with a school district subject to Article 34 of the School Code
5exceed $50,000, and any affiliated entities or affiliated
6persons of such business entity, are prohibited from making any
7contributions to (i) a member of the school board of a school
8district subject to Article 34 of the School Code or (ii) any
9other declared candidate for that office.
10    (e) The State Board of Elections shall provide by rule for
11the registration of business entities that are prohibited from
12making contributions under this Section.
13    (f) The State Board of Elections shall provide a
14certificate of registration to the business entity. The
15certificate shall be electronic, except as otherwise provided
16in this Section, and accessible to the business entity through
17the State Board of Elections' website and protected by a
18password. Within 60 days after establishment of the electronic
19system, each business entity that submitted a registration via
20e-mail attachment or paper copy pursuant to this Section shall
21re-submit its registration electronically. At the time of
22re-submission, the State Board of Elections shall provide an
23electronic certificate of registration to that business
24entity.
25    (g) Any business entity required to register under this
26Section shall provide a copy of the registration certificate,

 

 

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1by first class mail or hand delivery within 10 days after
2registration, to each affiliated entity or affiliated person
3whose identity is required to be disclosed. Failure to provide
4notice to an affiliated entity or affiliated person is a
5business offense for which the business entity is subject to a
6fine not to exceed $1,001.
7    (h) The intentional, willful, or material failure to
8disclose information required for registration is subject to a
9civil penalty imposed by the State Board of Elections. The
10Board shall impose a civil penalty of $1,000 per business day
11for failure to update a registration.
12    (i) Any business entity required to register under this
13Section shall notify any political committee to which it makes
14a contribution, at the time of the contribution, that the
15business entity is registered with the State Board of Elections
16under this Section. Any affiliated entity or affiliated person
17of a business entity required to register under this Section
18shall notify any political committee to which it makes a
19contribution that it is affiliated with a business entity
20registered with the State Board of Elections under this
21Section.
22    (j) The State Board of Elections on its official website
23shall have a searchable database containing (i) all information
24required to be submitted to the Board pursuant to rules adopted
25under this Section and (ii) all reports filed under Article 9
26of the Election Code with the State Board of Elections by all

 

 

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1political committees. For the purposes of databases maintained
2by the State Board of Elections, "searchable" means able to
3search by "political committee", as defined in this Article,
4and by "officeholder", the name of each school district subject
5to Article 34 of the School Code, "business entity",
6"affiliated entity", and "affiliated person". The Board shall
7not place the name of a minor child on the website. However,
8the Board shall provide a link to all contributions made by
9anyone reporting the same residential address as any affiliated
10person. In addition, the State Board of Elections on its
11official website shall provide an electronic connection to any
12searchable database of contracts with a school district subject
13to Article 34 of the School Code, searchable by business
14entity.
15    (k) It is unlawful for a candidate political committee
16established to support a candidate seeking nomination or
17election to the school board of a school district subject to
18Article 34 of the School Code to accept contributions from: (i)
19any labor organization that represents employees of that
20district; (ii) any other labor organization of which a labor
21organization described in clause (i) is an affiliate; (iii) any
22political action committee for which a labor organization
23described in clause (i) or (ii) is the sponsoring entity or any
24tax-exempt organization described in Section 527 of the
25Internal Revenue Code of 1986 (or any successor provision of
26federal tax law) established by a labor organization described

 

 

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1in clause (i) or (ii); or (iv) any tax-exempt organization
2described in Section 501(c) of the Internal Revenue Code of
31986 (or any successor provision of federal tax law)
4established by a labor organization described in clause (i) or
5(ii).
6    (l) A candidate political committee that receives a
7contribution or transfer in violation of this Section shall
8dispose of the contribution or transfer by returning the
9contribution or transfer, or an amount equal to the
10contribution or transfer, to the contributor or transferor or
11by donating the contribution or transfer, or an amount equal to
12the contribution or transfer, to a charity. A contribution or
13transfer received in violation of this Section that is not
14disposed of as provided in this subsection (l) within 30 days
15after the Board sends notification to the political committee
16of the contribution by certified mail shall escheat to the
17General Revenue Fund and the political committee shall be
18deemed in violation of this Section and subject to a civil
19penalty not to exceed 150% of the total amount of the
20contribution.
21    (m) The State Board of Elections shall have rulemaking
22authority to implement this Section.
 
23    Section 10. The School Code is amended by changing Sections
242-3.25f-5, 34-1, 34-3, and 34-4 and by adding Section 34-3.6 as
25follows:
 

 

 

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1    (105 ILCS 5/2-3.25f-5)
2    Sec. 2-3.25f-5. Independent Authority.
3    (a) The General Assembly finds all of the following:
4        (1) A fundamental goal of the people of this State, as
5    expressed in Section 1 of Article X of the Illinois
6    Constitution, is the educational development of all
7    persons to the limits of their capacities. When a school
8    board faces governance difficulties, continued operation
9    of the public school system is threatened.
10        (2) Sound school board governance, academic
11    achievement, and sound financial structure are essential
12    to the continued operation of any school system. It is
13    vital to commercial, educational, and cultural interests
14    that public schools remain in operation. To achieve that
15    goal, public school systems must have effective
16    leadership.
17        (3) To promote the sound operation of districts, as
18    defined in this Section, it may be necessary to provide for
19    the creation of independent authorities with the powers
20    necessary to promote sound governance, sound academic
21    planning, and sound financial management and to ensure the
22    continued operation of the public schools.
23        (4) It is the purpose of this Section to provide for a
24    sound basis for the continued operation of public schools.
25    The intention of the General Assembly, in creating this

 

 

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1    Section, is to establish procedures, provide powers, and
2    impose restrictions to ensure the educational integrity of
3    public school districts.
4    (b) As used in this Section:
5    "Board" means a school board of a district.
6    "Chairperson" means the Chairperson of the Independent
7Authority.
8    "District" means any school district having a population of
9not more than 500,000.
10    "State Board" means the State Board of Education.
11    "State Superintendent" means the State Superintendent of
12Education.
13    (c) The State Board has the power to direct the State
14Superintendent to remove a board. Boards may be removed when
15the criteria provided for in subsection (d) or subsection (d-5)
16of this Section are met. At no one time may the State Board
17remove more than 4 school boards and establish Independent
18Authorities pursuant to subsection (e) of this Section;
19provided that the foregoing limitation does not apply to the
20board of a district having a population of more than 500,000,
21and the removal of the board of a district having a population
22of more than 500,000 shall not count towards the foregoing
23limitation.
24    If the State Board proposes to direct the State
25Superintendent to remove a board from a district, board members
26shall receive individual written notice of the intended

 

 

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1removal. Written notice must be provided at least 30 calendar
2days before a hearing is held by the State Board. This notice
3shall identify the basis for proposed removal.
4    Board members are entitled to a hearing, during which time
5each board member shall have the opportunity to respond
6individually, both orally and through written comments, to the
7basis laid out in the notice. Written comments must be
8submitted to the State Board on or before the hearing.
9    Board members are entitled to be represented by counsel at
10the hearing, but counsel must not be paid with district funds,
11unless the State Board decides that the board will not be
12removed and then the board members may be reimbursed for all
13reasonable attorney's fees by the district.
14    The State Board shall make a final decision on removal
15immediately following the hearing or at its next regularly
16scheduled or special meeting. In no event may the decision be
17made later than the next regularly scheduled meeting.
18    The State Board shall issue a final written decision. If
19the State Board directs the State Superintendent to remove the
20board, the State Superintendent shall do so within 30 days
21after the written decision. Following the removal of the board,
22the State Superintendent shall establish an Independent
23Authority pursuant to subsection (e) of this Section.
24    If there is a financial oversight panel operating in the
25district pursuant to Article 1B or 1H of this Code, the State
26Board may, at its discretion, abolish the panel.

 

 

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1    (d) The State Board may require priority districts, as
2defined in subsection (b-5) of Section 2-3.25f of this Code, to
3seek accreditation through an independent accreditation
4organization chosen by the State Board and paid for by the
5State. The State Board may direct the State Superintendent to
6remove board members pursuant to subsection (c) of this Section
7in any district having a population of not more than 500,000 in
8which the district is unable to obtain accreditation in whole
9or in part due to reasons specifically related to school board
10governance. When determining if a district has failed to meet
11the standards for accreditation specifically related to school
12board governance, the accreditation entity shall take into
13account the overall academic, fiscal, and operational
14condition of the district and consider whether the board has
15failed to protect district assets, to direct sound
16administrative and academic policy, to abide by basic
17governance principles, including those set forth in district
18policies, and to conduct itself with professionalism and care
19and in a legally, ethically, and financially responsible
20manner. When considering if a board has failed in these areas,
21the accreditation entity shall consider some or all of the
22following factors:
23        (1) Failure to protect district assets by, without
24    limitation, incidents of fiscal fraud or misappropriation
25    of district funds; acts of neglecting the district's
26    building conditions; a failure to meet regularly

 

 

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1    scheduled, payroll-period obligations when due; a failure
2    to abide by competitive bidding laws; a failure to prevent
3    an audit finding of material internal control weaknesses; a
4    failure to comply with required accounting principles; a
5    failure to develop and implement a comprehensive,
6    risk-management plan; a failure to provide financial
7    information or cooperate with the State Superintendent; or
8    a failure to file an annual financial report, an annual
9    budget, a deficit reduction plan, or other financial
10    information as required by law.
11        (2) Failure to direct sound administrative and
12    academic policy by, without limitation, hiring staff who do
13    not meet minimal certification requirements for the
14    positions being filled or who do not meet the customary
15    qualifications held by those occupying similar positions
16    in other school districts; a failure to avoid conflicts of
17    interest as it relates to hiring or other contractual
18    obligations; a failure to provide minimum graduation
19    requirements and curricular requirements of the School
20    Code and regulations; a failure to provide a minimum school
21    term as required by law; or a failure to adopt and
22    implement policies and practices that promote conditions
23    that support student learning, effective instruction, and
24    assessment that produce equitable and challenging learning
25    experiences for all students.
26        (3) Failure to abide by basic governance principles by,

 

 

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1    without limitation, a failure to comply with the mandated
2    oath of office; a failure to adopt and abide by sound local
3    governance policies; a failure to abide by the principle
4    that official action by the board occurs only through a
5    duly-called and legally conducted meeting of the board; a
6    failure to abide by majority decisions of the board; a
7    failure to protect the privacy of students; a failure to
8    ensure that board decisions and actions are in accordance
9    with defined roles and responsibilities; or a failure of
10    the board to protect, support, and respect the autonomy of
11    a system to accomplish goals for improvement in student
12    learning and instruction and to manage day-to-day
13    operations of the school system and its schools, including
14    maintaining the distinction between the board's roles and
15    responsibilities and those of administrative leadership.
16        (4) Failure to conduct itself in a legally, ethically,
17    and financially responsible manner by, without limitation,
18    a failure to act in accordance with the Constitution of the
19    United States of America and the Constitution of the State
20    of Illinois and within the scope of State and federal laws;
21    laws, including a failure to comply with provisions of the
22    School Code, the Open Meetings Act, and the Freedom of
23    Information Act and federal and State laws that protect the
24    rights of protected categories of students; a failure to
25    comply with all district policies and procedures and all
26    State rules; or a failure to comply with the governmental

 

 

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1    entities provisions of the State Officials and Employees
2    Ethics Act, including the gift ban and prohibited political
3    activities provisions.
4    (d-5) The State Board may direct the State Superintendent
5to remove board members pursuant to subsection (c) of this
6Section in any district having a population of more than
7500,000 that is in financial difficulty. For the purposes of
8this subsection (d-5), a district is in financial difficulty if
9it meets one or more of the criteria set out in paragraphs (1)
10through (5) of subsection (b) of Section 1A-8 of the School
11Code, regardless of whether the district is a priority
12district, is unable to obtain accreditation, or has been
13previously certified to be in financial difficulty by the State
14Board pursuant to Section 1A-8 of the School Code.
15    (e) Upon removal of the board, the State Superintendent
16shall establish an Independent Authority. Upon establishment
17of an Independent Authority, there is established a body both
18corporate and politic to be known as the "(Name of the School
19District) Independent Authority", which in this name shall
20exercise all of the authority vested in an Independent
21Authority by this Section and by the name may sue and be sued
22in all courts and places where judicial proceedings are had.
23    (f) Upon establishment of an Independent Authority under
24subsection (e) of this Section, the State Superintendent shall,
25within 30 working days thereafter and in consultation with
26State and locally elected officials, appoint 5 or 7 members to

 

 

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1serve on an Independent Authority for the district. Members
2appointed to the Independent Authority shall serve at the
3pleasure of the State Superintendent. The State Superintendent
4shall designate one of the members of the Independent Authority
5to serve as its chairperson. In the event of vacancy or
6resignation, the State Superintendent shall, within 15 working
7days after receiving notice, appoint a successor to serve out
8that member's term. If the State Board has abolished a
9financial oversight panel pursuant to subsection (c) of this
10Section, the State Superintendent may appoint former members of
11the panel to the Independent Authority. These members may serve
12as part of the 5 or 7 members or may be appointed in addition to
13the 5 or 7 members, with the Independent Authority not to
14exceed 9 members in total.
15    Members of the Independent Authority must be selected
16primarily on the basis of their experience and knowledge in
17education policy and governance, with consideration given to
18persons knowledgeable in the operation of a school district. A
19member of the Independent Authority must be a registered voter
20as provided in the general election law, must not be a school
21trustee, and must not be a child sex offender as defined in
22Section 11-9.3 of the Criminal Code of 2012. A majority of the
23members of the Independent Authority must be residents of the
24district that the Independent Authority serves. A member of the
25Independent Authority may not be an employee of the district,
26nor may a member have a direct financial interest in the

 

 

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1district.
2    Independent Authority members may be reimbursed by the
3district for travel if they live more than 25 miles away from
4the district's headquarters and other necessary expenses
5incurred in the performance of their official duties. The
6amount reimbursed members for their expenses must be charged to
7the school district.
8    With the exception of the Chairperson, the Independent
9Authority may elect such officers as it deems appropriate.
10    The first meeting of the Independent Authority must be held
11at the call of the Chairperson. The Independent Authority shall
12prescribe the times and places for its meetings and the manner
13in which regular and special meetings may be called and shall
14comply with the Open Meetings Act.
15    All Independent Authority members must complete the
16training required of school board members under Section 10-16a
17of this Code.
18    (g) The purpose of the Independent Authority is to operate
19the district. The Independent Authority shall have all of the
20powers and duties of a board and all other powers necessary to
21meet its responsibilities and to carry out its purpose and the
22purposes of this Section and that may be requisite or proper
23for the maintenance, operation, and development of any school
24or schools under the jurisdiction of the Independent Authority.
25This grant of powers does not release an Independent Authority
26from any duty imposed upon it by this Code or any other law.

 

 

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1    The Independent Authority shall have no power to
2unilaterally cancel or modify any collective bargaining
3agreement in force upon the date of creation of the Independent
4Authority.
5    (h) The Independent Authority may prepare and file with the
6State Superintendent a proposal for emergency financial
7assistance for the school district and for the operations
8budget of the Independent Authority, in accordance with Section
91B-8 of this Code. A district may receive both a loan and a
10grant.
11    (i) Paragraph (1) of this subsection applies only to a
12district other than a district subject to Article 34 of this
13Code. Paragraph (2) of this subsection applies only to a
14district subject to Article 34 of this Code. Paragraph (3) of
15this subsection applies to any district.
16        (1) An election for board members must not be held in a
17    district upon the establishment of an Independent
18    Authority and is suspended until the next regularly
19    scheduled school board election that takes place no less
20    than 2 years following the establishment of the Independent
21    Authority.
22         For this first election, 3 school board members must
23    be elected to serve out terms of 4 years and until
24    successors are elected and have qualified. Members of the
25    Independent Authority are eligible to run for election in
26    the district, provided that they meet all other eligibility

 

 

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1    requirements of Section 10-10 of this Code. Following this
2    election, the school board shall consist of the newly
3    elected members and any remaining members of the
4    Independent Authority. The majority of this board must be
5    residents of the district. The State Superintendent must
6    appoint new members who are residents to the Independent
7    Authority if necessary to maintain this majority. At the
8    next school board election, 4 school board members must be
9    elected to serve out terms of 4 years and until successors
10    are elected and have qualified. For purposes of these first
11    2 elections, the school board members must be elected
12    at-large. In districts where board members were previously
13    elected using an alternative format pursuant to Article 9
14    of this Code, following these first 2 elections, the voting
15    shall automatically revert back to the original form.
16    Following the election, any remaining Independent
17    Authority members shall serve in the district as an
18    oversight panel until such time as the district meets the
19    governance standards necessary to achieve accreditation.
20    If some or all of the Independent Authority members have
21    been elected to the board, the State Superintendent may, in
22    his or her discretion, appoint new members to the
23    Independent Authority pursuant to subsection (f) of this
24    Section. The school board shall get approval of all actions
25    by the Independent Authority during the time the
26    Independent Authority serves as an oversight panel.

 

 

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1        (2) In the case of a district subject to Article 34 of
2    this Code, no board member, chief executive officer,
3    general superintendent, or other officer shall be
4    appointed pursuant to the provisions of Article 34 of this
5    Code, as applicable.
6        The first election for board members shall be held
7    after the State Board determines that the district is no
8    longer in financial difficulty, or has taken sufficient
9    steps to no longer be in financial difficulty within 2
10    years, but not earlier than the election that occurs at
11    least 24 months after the date the Independent Authority
12    was first appointed.
13        For this first election of a board in a district
14    subject to Article 34, 3 board members must be elected to
15    terms of 4 years and until their successors are elected and
16    qualified, as provided in subsection (b-5) of Section 34-3.
17    Members of the Independent Authority are eligible to run
18    for election in the district, provided that they meet all
19    other eligibility requirements of Article 34 of this Code.
20    Following this first election, the board shall consist of
21    the 3 newly elected members and 4 members of the
22    Independent Authority designated by the State
23    Superintendent. If some or all of the Independent Authority
24    members have been elected to the board, the State
25    Superintendent may, in his or her discretion, appoint new
26    members to the Independent Authority pursuant to

 

 

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1    subsection (f) of this Section. The majority of this board
2    must be residents of the district. The State Superintendent
3    must appoint new members who are residents to the
4    Independent Authority if necessary to maintain this
5    majority.
6        Following this first election, the 4 members of the
7    Independent Authority shall serve in the district as an
8    oversight panel until additional board members have been
9    elected and qualified pursuant to the immediately
10    following paragraph. The board shall obtain approval of all
11    actions by the Independent Authority during the time the
12    Independent Authority serves as an oversight panel.
13        At the second board election, 4 board members must be
14    elected to terms of 4 years and until their successors are
15    elected and qualified.
16        (3) Board members who were removed pursuant to
17    subsection (c) of this Section are ineligible to run for
18    school board in the district for 10 years following the
19    abolition of the Independent Authority pursuant to
20    subsection (l) of this Section. However, board members who
21    were removed pursuant to subsection (c) of this Section and
22    were appointed to the Independent Authority by the State
23    Superintendent are eligible to run for school board in the
24    district.
25    (j) The Independent Authority, upon its members taking
26office and annually thereafter and upon request, shall prepare

 

 

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1and submit to the State Superintendent a report on the state of
2the district, including without limitation the academic
3improvement and financial situation of the district. This
4report must be submitted annually on or before March 1 of each
5year. The State Superintendent shall provide copies of any and
6all reports to the regional office of education for the
7district and to the State Senator and Representative
8representing the area where the district is located.
9    (k) The district shall render such services to and permit
10the use of its facilities and resources by the Independent
11Authority at no charge as may be requested by the Independent
12Authority. Any State agency, unit of local government, or
13school district may, within its lawful powers and duties,
14render such services to the Independent Authority as may be
15requested by the Independent Authority.
16    (l) An Independent Authority must be abolished when the
17district, following the election of the full board, meets the
18governance standards necessary to achieve accreditation status
19by an independent accreditation agency chosen by the State
20Board. The abolition of the Independent Authority shall be done
21by the State Board and take place within 30 days after the
22determination of the accreditation agency or the State Board
23determines that the district is no longer in financial
24difficulty.
25    Upon abolition of the Independent Authority, all powers and
26duties allowed by this Code to be exercised by a school board

 

 

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1shall be transferred to the elected school board.
2    (m) The Independent Authority must be indemnified through
3insurance purchased by the district. The district shall
4purchase insurance through which the Independent Authority is
5to be indemnified.
6    The district retains the duty to represent and to indemnify
7Independent Authority members following the abolition of the
8Independent Authority for any cause of action or remedy
9available against the Independent Authority, its members, its
10employees, or its agents for any right or claim existing or any
11liability incurred prior to the abolition.
12    The insurance shall indemnify and protect districts,
13Independent Authority members, employees, volunteer personnel
14authorized in Sections 10-22.34, 10-22.34a, and 10-22.34b of
15this Code, mentors of certified or licensed staff as authorized
16in Article 21A and Sections 2-3.53a, 2-3.53b, and 34-18.33 of
17this Code, and student teachers against civil rights damage
18claims and suits, constitutional rights damage claims and
19suits, and death and bodily injury and property damage claims
20and suits, including defense thereof, when damages are sought
21for negligent or wrongful acts alleged to have been committed
22in the scope of employment, under the direction of the
23Independent Authority, or related to any mentoring services
24provided to certified or licensed staff of the district. Such
25indemnification and protection shall extend to persons who were
26members of an Independent Authority, employees of an

 

 

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1Independent Authority, authorized volunteer personnel, mentors
2of certified or licensed staff, or student teachers at the time
3of the incident from which a claim arises. No agent may be
4afforded indemnification or protection unless he or she was a
5member of an Independent Authority, an employee of an
6Independent Authority, an authorized volunteer, a mentor of
7certified or licensed staff, or a student teacher at the time
8of the incident from which the claim arises.
9    (n) The State Board may adopt rules as may be necessary for
10the administration of this Section.
11    (o) This Section shall not be construed to create any debt
12or liability of the State or to pledge the full faith and
13credit of the State, directly, indirectly, or contingently, or
14to transfer to the State any of the debts, liabilities, or
15obligations of the district. This subsection (o) is declarative
16of current law.
17(Source: P.A. 98-1155, eff. 1-9-15.)
 
18    (105 ILCS 5/34-1)  (from Ch. 122, par. 34-1)
19    Sec. 34-1. Application of article; Definitions. This
20Article applies only to cities having a population exceeding
21500,000.
22    "Trustees", when used in this Article, means the Chicago
23School Reform Board of Trustees created by this amendatory Act
24of 1995 and serving as the governing board of the school
25district organized under this Article beginning with its

 

 

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1appointment on or after the effective date of this amendatory
2Act of 1995 and continuing until June 30, 1999 or the
3appointment of a new Chicago Board of Education as provided in
4Section 34-3, whichever is later.
5    "Board", or "board of education" when used in this Article,
6means: (i) the Chicago School Reform Board of Trustees for the
7period that begins with the appointment of the Trustees and
8that ends on the later of June 30, 1999 or the appointment of a
9new Chicago Board of Education as provided in Section 34-3; and
10(ii) the new Chicago Board of Education from and after June 30,
111999 or from and after its appointment as provided in Section
1234-3, whichever is later, until the applicability of clause
13(iii) of this definition; and (iii) if the board is removed and
14an Independent Authority appointed pursuant to Section
152-3.25f-5 of this Code, that Independent Authority and, upon
16its abolition, the board elected pursuant to Section 2-3.25f-5
17and subsection (b-5) of Section 34-3 of this Code.
18    Except during the period that begins with the appointment
19of the Chicago School Reform Board of Trustees on or after the
20effective date of this amendatory Act of 1995 and that ends on
21the later of June 30, 1999 or the appointment of a new Chicago
22Board of Education as provided in Section 34-3: (i) the school
23district organized under this Article may be subject to further
24limitations imposed under Article 34A; and (ii) the provisions
25of Article 34A prevail over the other provisions of this Act,
26including the provisions of this Article, to the extent of any

 

 

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1conflict.
2(Source: P.A. 89-15, eff. 5-30-95.)
 
3    (105 ILCS 5/34-3)  (from Ch. 122, par. 34-3)
4    Sec. 34-3. Chicago School Reform Board of Trustees; new
5Chicago Board of Education; members; term; vacancies.
6    (a) Within 30 days after the effective date of this
7amendatory Act of 1995, the terms of all members of the Chicago
8Board of Education holding office on that date are abolished
9and the Mayor shall appoint, without the consent or approval of
10the City Council, a 5 member Chicago School Reform Board of
11Trustees which shall take office upon the appointment of the
12fifth member. The Chicago School Reform Board of Trustees and
13its members shall serve until, and the terms of all members of
14the Chicago School Reform Board of Trustees shall expire on,
15June 30, 1999 or upon the appointment of a new Chicago Board of
16Education as provided in subsection (b), whichever is later.
17Any vacancy in the membership of the Trustees shall be filled
18through appointment by the Mayor, without the consent or
19approval of the City Council, for the unexpired term. One of
20the members appointed by the Mayor to the Trustees shall be
21designated by the Mayor to serve as President of the Trustees.
22The Mayor shall appoint a full-time, compensated chief
23executive officer, and his or her compensation as such chief
24executive officer shall be determined by the Mayor. The Mayor,
25at his or her discretion, may appoint the President to serve

 

 

HB4498- 29 -LRB099 18962 JWD 43351 b

1simultaneously as the chief executive officer.
2    (b) Within 30 days before the expiration of the terms of
3the members of the Chicago Reform Board of Trustees as provided
4in subsection (a), a new Chicago Board of Education consisting
5of 7 members shall be appointed by the Mayor to take office on
6the later of July 1, 1999 or the appointment of the seventh
7member. Three of the members initially so appointed under this
8subsection shall serve for terms ending June 30, 2002, 4 of the
9members initially so appointed under this subsection shall
10serve for terms ending June 30, 2003, and each member initially
11so appointed shall continue to hold office until his or her
12successor is appointed and qualified. Thereafter at the
13expiration of the term of any member a successor shall be
14appointed by the Mayor and shall hold office for a term of 4
15years, from July 1 of the year in which the term commences and
16until a successor is appointed and qualified. Any vacancy in
17the membership of the Chicago Board of Education shall be
18filled through appointment by the Mayor for the unexpired term.
19No appointment to membership on the Chicago Board of Education
20that is made by the Mayor under this subsection shall require
21the approval of the City Council, whether the appointment is
22made for a full term or to fill a vacancy for an unexpired term
23on the Board. The board shall elect annually from its number a
24president and vice-president, in such manner and at such time
25as the board determines by its rules. The officers so elected
26shall each perform the duties imposed upon their respective

 

 

HB4498- 30 -LRB099 18962 JWD 43351 b

1office by the rules of the board, provided that (i) the
2president shall preside at meetings of the board and vote as
3any other member but have no power of veto, and (ii) the vice
4president shall perform the duties of the president if that
5office is vacant or the president is absent or unable to act.
6The secretary of the Board shall be selected by the Board and
7shall be an employee of the Board rather than a member of the
8Board, notwithstanding subsection (d) of Section 34-3.3. The
9duties of the secretary shall be imposed by the rules of the
10Board.
11    (b-5) Notwithstanding any provision of this Code to the
12contrary, if the board is removed and an Independent Authority
13is appointed pursuant to Section 2-3.25f-5 of this Code, the
14members of the board thereafter shall be elected, rather than
15appointed, pursuant to Section 2-3.25f-5 of this Code and the
16following:
17        (1) Board members shall be elected at-large in each
18    odd-numbered year, each for a term of 4 years, in
19    accordance with the general election law.
20        (2) For the first election pursuant to Section
21    2-3.25f-5 of this Code, 3 board members shall be elected to
22    terms of 4 years and until their successors are elected and
23    qualified. Following this election, the board shall
24    consist of the newly elected members and 4 members of the
25    Independent Authority designated by the State
26    Superintendent. At the next board election, 4 board members

 

 

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1    shall be elected to terms of 4 years and until their
2    successors are elected and qualified, after which the board
3    shall consist of the 7 elected members.
4        (3) Nomination papers filed under this Section are not
5    valid unless the candidate named therein files with the
6    board of election commissioners a receipt from the county
7    clerk showing that the candidate has filed a statement of
8    economic interests as required by the Illinois
9    Governmental Ethics Act. Such receipt shall be so filed
10    either previously during the calendar year in which his or
11    her nomination papers were filed or within the period for
12    the filing of nomination papers in accordance with the
13    general election law.
14        (4) When a vacancy occurs in the membership of the
15    board, the remaining members shall, within 30 days, fill
16    the vacancy by appointment until the next regular board
17    election.
18    (c) The board may appoint a student to the board to serve
19in an advisory capacity. The student member shall serve for a
20term as determined by the board. The board may not grant the
21student member any voting privileges, but shall consider the
22student member as an advisor. The student member may not
23participate in or attend any executive session of the board.
24(Source: P.A. 94-231, eff. 7-14-05.)
 
25    (105 ILCS 5/34-3.6 new)

 

 

HB4498- 32 -LRB099 18962 JWD 43351 b

1    Sec. 34-3.6. Prohibition on political contributions;
2business registration.
3    (a) As used in this Section:
4    The terms "contract", "Chicago Public Schools contract",
5and "contract with Chicago Public Schools" each mean any
6contract between a business entity and Chicago Public Schools.
7    "Contribution" means a contribution as defined in Section
89-1.4 of the Election Code.
9    "Declared candidate" means a person who has filed a
10statement of candidacy and petition for nomination or election
11to the Chicago Board of Education.
12    "Officeholder" means an elected or appointed member of the
13Chicago Board of Education.
14    "Sponsoring entity" means a sponsoring entity as defined in
15Section 9-3 of the Election Code.
16    "Affiliated person" means (i) any person with any ownership
17interest or distributive share of the bidding or contracting
18business entity in excess of 7.5%, (ii) executive employees of
19the bidding or contracting business entity, and (iii) the
20spouse of any such persons. "Affiliated person" does not
21include a person prohibited by federal law from making
22contributions or expenditures in connection with a federal,
23state, or local election.
24    "Affiliated entity" means (i) any corporate parent and each
25operating subsidiary of the bidding or contracting business
26entity, (ii) each operating subsidiary of the corporate parent

 

 

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1of the bidding or contracting business entity, (iii) any
2organization recognized by the United States Internal Revenue
3Service as a tax-exempt organization described in Section
4501(c) of the Internal Revenue Code of 1986 (or any successor
5provision of federal tax law) established by the bidding or
6contracting business entity, any affiliated entity of that
7business entity, or any affiliated person of that business
8entity, or (iv) any political committee for which the bidding
9or contracting business entity, or any 501(c) organization
10described in item (iii) related to that business entity, is the
11sponsoring entity. "Affiliated entity" does not include an
12entity prohibited by federal law from making contributions or
13expenditures in connection with a federal, state, or local
14election.
15    "Business entity" means any entity doing business for
16profit, whether organized as a corporation, partnership, sole
17proprietorship, limited liability company or partnership, or
18otherwise.
19    "Executive employee" means (i) the president, chairman of
20the board, or chief executive officer of a business entity and
21any other individual that fulfills equivalent duties as the
22president, chairman of the board, or chief executive officer of
23a business entity; and (ii) any employee of a business entity
24whose compensation is determined directly, in whole or in part,
25by the award or payment of contracts by the Chicago Public
26Schools to the entity employing the employee. A regular salary

 

 

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1that is paid irrespective of the award or payment of a contract
2with the Chicago Public Schools shall not constitute
3"compensation" under item (ii) of this definition. "Executive
4employee" does not include any person prohibited by federal law
5from making contributions or expenditures in connection with a
6federal, state, or local election.
7    (b) Any business entity whose contracts with Chicago Public
8Schools, in the aggregate, annually total more than $50,000,
9and any affiliated entities or affiliated persons of such
10business entity, are prohibited from making any contributions
11to any political committees established to promote the
12candidacy of (i) a member of the Chicago Board of Education or
13(ii) any other declared candidate for that office. This
14prohibition shall be effective for the duration of the term of
15office of the incumbent officeholders at the time the contracts
16were awarded or for a period of 2 years following the
17expiration or termination of the contracts, whichever is
18longer.
19    (c) Any business entity whose aggregate pending bids and
20offers on Chicago Public Schools contracts total more than
21$50,000, or whose aggregate pending bids and offers on Chicago
22Public Schools contracts combined with the business entity's
23aggregate annual total value of Chicago Public Schools
24contracts exceed $50,000, and any affiliated entities or
25affiliated persons of such business entity, are prohibited from
26making any contributions to (i) a member of the Chicago Board

 

 

HB4498- 35 -LRB099 18962 JWD 43351 b

1of Education or (ii) any other declared candidate for that
2office.
3    (d) The State Board of Elections shall provide by rule for
4the registration of business entities that are prohibited from
5making contributions under this Section.
6    (e) The State Board of Elections shall provide a
7certificate of registration to the business entity. The
8certificate shall be electronic, except as otherwise provided
9in this Section, and accessible to the business entity through
10the State Board of Elections' website and protected by a
11password. Within 60 days after establishment of the electronic
12system, each business entity that submitted a registration via
13e-mail attachment or paper copy pursuant to this Section shall
14re-submit its registration electronically. At the time of
15re-submission, the State Board of Elections shall provide an
16electronic certificate of registration to that business
17entity.
18    (f) Any business entity required to register under this
19Section shall provide a copy of the registration certificate,
20by first class mail or hand delivery within 10 days after
21registration, to each affiliated entity or affiliated person
22whose identity is required to be disclosed. Failure to provide
23notice to an affiliated entity or affiliated person is a
24business offense for which the business entity is subject to a
25fine not to exceed $1,001.
26    (g) The intentional, willful, or material failure to

 

 

HB4498- 36 -LRB099 18962 JWD 43351 b

1disclose information required for registration is subject to a
2civil penalty imposed by the State Board of Elections. The
3Board shall impose a civil penalty of $1,000 per business day
4for failure to update a registration.
5    (h) Any business entity required to register under this
6Section shall notify any political committee to which it makes
7a contribution, at the time of the contribution, that the
8business entity is registered with the State Board of Elections
9under this Section. Any affiliated entity or affiliated person
10of a business entity required to register under this Section
11shall notify any political committee to which it makes a
12contribution that it is affiliated with a business entity
13registered with the State Board of Elections under this
14Section.
15    (i) The State Board of Elections on its official website
16shall have a searchable database containing (i) all information
17required to be submitted to the Board pursuant to rules adopted
18under this Section and (ii) all reports filed under Article 9
19of the Election Code with the State Board of Elections by all
20political committees. For the purposes of databases maintained
21by the State Board of Elections, "searchable" means able to
22search by "political committee", as defined in Article 9 of the
23Election Code, and by "officeholder", "Chicago Public
24Schools", "business entity", "affiliated entity", and
25"affiliated person". The Board shall not place the name of a
26minor child on the website. However, the Board shall provide a

 

 

HB4498- 37 -LRB099 18962 JWD 43351 b

1link to all contributions made by anyone reporting the same
2residential address as any affiliated person. In addition, the
3State Board of Elections on its official website shall provide
4an electronic connection to any searchable database of Chicago
5Public Schools contracts, searchable by business entity.
6    (j) The State Board of Elections shall have rulemaking
7authority to implement this Section.
 
8    (105 ILCS 5/34-4)  (from Ch. 122, par. 34-4)
9    Sec. 34-4. Eligibility. To be eligible for appointment or
10election to the board, a person shall be a citizen of the
11United States, shall be a registered voter as provided in the
12Election Code, shall have been a resident of the city for at
13least 3 years immediately preceding his or her appointment or
14election, and shall not be a child sex offender as defined in
15Section 11-9.3 of the Criminal Code of 2012. Permanent removal
16from the city by any member of the board during his term of
17office constitutes a resignation therefrom and creates a
18vacancy in the board. Except for the President of the Chicago
19School Reform Board of Trustees who may be paid compensation
20for his or her services as chief executive officer as
21determined by the Mayor as provided in subsection (a) of
22Section 34-3, board members shall serve without any
23compensation; provided, that board members shall be reimbursed
24for expenses incurred while in the performance of their duties
25upon submission of proper receipts or upon submission of a

 

 

HB4498- 38 -LRB099 18962 JWD 43351 b

1signed voucher in the case of an expense allowance evidencing
2the amount of such reimbursement or allowance to the president
3of the board for verification and approval. The board of
4education may continue to provide health care insurance
5coverage, employer pension contributions, employee pension
6contributions, and life insurance premium payments for an
7employee required to resign from an administrative, teaching,
8or career service position in order to qualify as a member of
9the board of education. They shall not hold other public office
10under the Federal, State or any local government other than
11that of Director of the Regional Transportation Authority,
12member of the economic development commission of a city having
13a population exceeding 500,000, notary public or member of the
14National Guard, and by accepting any such office while members
15of the board, or by not resigning any such office held at the
16time of being appointed or elected to the board within 30 days
17after such appointment or election, shall be deemed to have
18vacated their membership in the board. A board member may not
19be employed by or accept any compensation from the district in
20any capacity or accept any payment or other benefit from the
21Public School Teachers' Pension and Retirement Fund created by
22Article 17 of the Pension Code in which the board member is an
23annuitant, and by holding or accepting any such employment,
24compensation, payment, or other benefit while a member of the
25board, or by not resigning any such employment within 30 days
26after such appointment or election, shall be deemed to have

 

 

HB4498- 39 -LRB099 18962 JWD 43351 b

1vacated his or her membership in the board.
2(Source: P.A. 97-1150, eff. 1-25-13.)
 
3    (105 ILCS 5/34-1.05 rep.)
4    Section 15. The School Code is amended by repealing Section
534-1.05.
 
6    Section 90. The State Mandates Act is amended by adding
7Section 8.40 as follows:
 
8    (30 ILCS 805/8.40 new)
9    Sec. 8.40. Exempt mandate. Notwithstanding Sections 6 and 8
10of this Act, no reimbursement by the State is required for the
11implementation of any mandate created by this amendatory Act of
12the 99th General Assembly.
 
13    Section 99. Effective date. This Act takes effect upon
14becoming law.