HB0721 102ND GENERAL ASSEMBLY

  
  

 


 
102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB0721

 

Introduced 2/8/2021, by Rep. Delia C. Ramirez

 

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

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


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A BILL FOR

 

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

 

 

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

 

 

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1    organization's Board of Directors and key employees are
2    minority persons;
3        (2) the organization is regularly and actively engaged
4    in the activity for which it is formed;
5        (3) the organization is not dependent upon or
6    influenced by another non-eligible person or organization;
7    and
8        (4) the organization has not been established or
9    reorganized for the specific purpose of participating in
10    the Business Enterprise Program.
11    "Not-for-profit organization led by a person with a
12disability" means an organization that is tax-exempt under
13Sections 501(c)(3) or 501(c)(4) of the Internal Revenue Code
14of 1986, and for which:
15        (1) at least 51% of the organization's Board of
16    Directors are persons with a disability, or at least 51%
17    of the organization's Board of Directors and key employees
18    are persons with a disability;
19        (2) the organization is regularly and actively engaged
20    in the activity for which it is formed;
21        (3) the organization is not dependent upon or
22    influenced by another non-eligible person or organization;
23    and
24        (4) the organization has not been established or
25    reorganized for the specific purpose of participating in
26    the Business Enterprise Program.

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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1101-601, eff. 1-1-20; revised 8-18-20.)
 
2    Section 105. The Public Utilities Act is amended by
3changing Section 5-117 as follows:
 
4    (220 ILCS 5/5-117)
5    Sec. 5-117. Supplier diversity goals.
6    (a) The public policy of this State is to collaboratively
7work with companies and not-for-profit organizations that
8serve Illinois residents to improve their supplier diversity
9in a non-antagonistic manner.
10    (a-5) For the purposes of this Section, "minority-led
11not-for-profit organization", "woman-led not-for-profit
12organization", and "not-for-profit organization led by a
13person with a disability" shall have the same meanings as
14provided under the Not-for-Profit Business Enterprise Act.
15    (b) The Commission shall require all gas, electric, and
16water companies with at least 100,000 customers under its
17authority, as well as suppliers of wind energy, solar energy,
18hydroelectricity, nuclear energy, and any other supplier of
19energy within this State, to submit an annual report by April
2015, 2015 and every April 15 thereafter, in a searchable Adobe
21PDF format, on all procurement goals and actual spending for
22female-owned, minority-owned, veteran-owned, person with a
23disability-owned, and small business enterprises, as well as
24minority-led not-for-profit organizations, woman-led

 

 

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

 

 

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

 

 

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1participating entity as well as subject matter experts and
2advocates. The Commission shall publish a database on its
3website of the point of contact for each participating entity
4for supplier diversity, along with a list of certifications
5each company recognizes from the information submitted in each
6annual report. The Commission shall publish each annual report
7on its website and shall maintain each annual report for at
8least 5 years.
9(Source: P.A. 98-1056, eff. 8-26-14; 99-906, eff. 6-1-17;
10revised 7-22-19.)