Illinois Compiled Statutes
105 ILCS 5/ - School Code.
Article 34A - School Finance Authority

(105 ILCS 5/Art. 34A heading)

 
(105 ILCS 5/34A-101) (from Ch. 122, par. 34A-101)
Sec. 34A-101.
Short title.
This Article shall be known and may be cited
as the "School Finance Authority Act."

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-102) (from Ch. 122, par. 34A-102)
Sec. 34A-102.
Findings and purpose.
(a) The General Assembly finds:
(b) It is the purpose of this Article to provide a secure financial basis
for the continued operation of the public schools. In addition, it is the
further purpose of this Article to facilitate implementation of school
reform in the continued operation of the public schools in accordance with
the provisions of this amendatory Act of 1991. The intention of the
General Assembly, in enacting this legislation, is to establish procedures,
provide powers and impose restrictions to assure the financial and
educational integrity of the public schools while leaving principal
responsibility for the educational policies of the public schools to the
boards of education within the State, consistent with the requirements for
satisfying the public policy and purpose herein set forth.

(Source: P.A. 85-1418; 86-1477.)
 
(105 ILCS 5/34A-103) (from Ch. 122, par. 34A-103)
Sec. 34A-103.
Definitions.
As used in this Article:
(a) "Authority" means the "(Name of City) School Finance Authority";
(b) "Board" means any board of education to which this Article is
applicable;
(c) "Budget" means the budget of the Board as defined in Section 34-43
of this Act, as from time to time in effect;
(d) "Chairman" means the chairman of the Authority appointed pursuant
to paragraph (c) of Section 34A-301 of this Article;
(e) "City" means the city wherein the school district of such Board
is located;
(f) "Financial Plan" means the financial plan of the Board to be developed
pursuant to Section 34A-403 of this Article, as from time to time in effect;
(g) "Fiscal Year" means the fiscal year of the Board;
(h) "Governor" means the Governor of the State of Illinois;
(i) "School year" means the school year of the Board;
(j) "Approved System-Wide Educational Reform Goals and Objectives Plan"
means the system-wide educational reform goals and objectives plan that has
been accepted and approved by the Authority;
(k) "Investment Obligations" means any of the following which at the time
of investment are legal investments under the laws of the State for the
money proposed to be invested therein:
(l) "Mayor" means the Mayor of the City;
(m) "Obligations" means bonds and notes of the Authority;
(n) "State" means the State of Illinois.

(Source: P.A. 85-1418; 86-1477.)
 
(105 ILCS 5/34A-104) (from Ch. 122, par. 34A-104)
Sec. 34A-104.
Establishment of Authority.
For each school district organized
under Article 34 there is established a body both corporate and politic
and a unit of local government to be known as the "(Name of City) School
Finance Authority" which, in such name, shall exercise all authority vested
in such Authority by this Article.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-201) (from Ch. 122, par. 34A-201)
Sec. 34A-201.
General powers.
The purposes of the Authority shall be to
exercise
financial control over the Board, and to furnish financial assistance so
that the Board can provide public education within the Board's jurisdiction
while permitting the Board to meet its obligations to its creditors and
the holders of its notes and bonds. Except as expressly limited by this
Article, the Authority shall have all powers necessary to meet its
responsibilities
and to carry out its purposes and the purposes of this Article, including,
but not limited to, the following powers:
(a) to sue and be sued;
(b) to provide for its organization and internal management
and, subject to agreements with or for the benefit of holders of its Obligations,
to make rules and regulations governing the use of its property and facilities;
(c) to make and execute contracts, leases, subleases and all other instruments
or agreements necessary or convenient for the exercise of the powers and
functions granted by this Article;
(d) to purchase real or personal property necessary or convenient for its
purposes; to execute and deliver deeds for real property held in its own
name; to mortgage, pledge or otherwise grant security interests in such
properties; and to sell, lease, or otherwise dispose of such of its property
as, in the judgment of the Authority, is no longer necessary for its purposes;
(e) to appoint officers, agents, and employees of the Authority, define
their duties and
qualifications and fix their compensation and employee benefits;
(f) to lend or otherwise transfer to the Board such sums of money as are
not required for other purposes;
(g) to borrow money and to issue Obligations pursuant to this Article,
to fund, refund or advance refund the same, to provide for the rights of
the holders of its Obligations, and to repay any advances;
(h) subject to the provisions of any contract with or for the benefit of
the holders of its Obligations, to purchase or redeem its Obligations or
to purchase the notes, bonds or obligations of the Board or the notes, bonds
or obligations of the City;
(i) to procure insurance against any loss in such amounts and from such
insurers as it deems desirable;
(j) to engage the services of consultants for rendering professional and
technical assistance and advice on matters within the Authority's power;
(k) to contract for and to accept any gifts, grants or loans of funds
or property or financial or other aid in any form from the federal government,
state government, unit of local government, school district or any agency
or instrumentality thereof, or from any other private or public source,
and to comply with the terms and conditions thereof;
(l) as security for the payment of the principal of and interest on its
Obligations and for the performance of any agreements made in connection
therewith, to grant a security interest or lien upon all or any part of
its property or revenues;
(m) to pay the expenses of its operations; and
(n) to do any and all things necessary or convenient to carry out its
purposes
and exercise the powers given to the Authority by this Article.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-201.1)
Sec. 34A-201.1.
(Repealed).

(Source: P.A. 89-15, eff. 5-30-95. Repealed by P.A. 89-698, eff. 1-14-97.)
 
(105 ILCS 5/34A-201a) (from Ch. 122, par. 34A-201a)
Sec. 34A-201a.
(Repealed).

(Source: Repealed by P.A. 88-511.)
 
(105 ILCS 5/34A-202) (from Ch. 122, par. 34A-202)
Sec. 34A-202.
Deposits and Investments.
(a) The Authority shall have the power to establish checking and whatever
other banking or savings and loan association accounts it may deem appropriate
for conducting its affairs.
(b) Subject to the provisions of any contract with or for the benefit of
the holders of its Obligations, the Authority may invest any funds not required
for immediate use or disbursement, whether pursuant to Section 34A-201 of
this Article or otherwise, only in Investment Obligations.
No bank or savings and loan association shall receive public funds as
permitted by this Section, unless it has complied with the requirements
established pursuant to Section 6 of "An Act relating to certain investments
of public funds by public agencies", approved July 23, 1943, as now or hereafter
amended.

(Source: P.A. 83-541.)
 
(105 ILCS 5/34A-301) (from Ch. 122, par. 34A-301)
Sec. 34A-301.
Board of Directors.
The governing body of the Authority shall
be a board consisting of 5 Directors appointed as follows:
(a) Two Directors appointed by the Governor, with the approval of the Mayor.
(b) Two Directors appointed by the Mayor, with the approval of the Governor.
(c) One Director appointed jointly by the Governor and the Mayor, who
shall serve as Chairman.
(d) The Governor and the Mayor shall certify their respective appointments
and approvals to the Secretary of State.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-302) (from Ch. 122, par. 34A-302)
Sec. 34A-302.
Terms, vacancies and removal.
Of the initial Directors appointed
by the Governor, with the approval of the Mayor, one each shall be selected
for terms expiring on January 31, 1981 and January 31, 1982. Of the initial
Directors appointed by the Mayor with the approval of the Governor, one
each shall be selected for terms expiring on January 31, 1981 and January
31, 1982. The initial Chairman shall be selected for a term expiring January 31, 1983.
Thereafter, each Director shall hold office for a term of 3 years, and until
his successor has been appointed as provided in Section 34A-301.
Any vacancy which shall arise, shall be filled as provided in Section 34A-301.
Any Director appointed to fill a vacancy shall serve until the expiration
of his predecessor's term, and until his successor has been appointed as
provided in Section 34A-301. A vacancy shall occur upon resignation, death,
conviction of a felony, or removal from office of a Director. Directors
shall be eligible for reappointment. Any Director may be removed for incompetence,
malfeasance or neglect of duty, at the instance of the occupant of the office
entitled to appoint that Director, or in the case of the Chairman
at the instance of the occupant of each office so entitled.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-303) (from Ch. 122, par. 34A-303)
Sec. 34A-303.
Chairman and other officers.
The Chairman shall preside at
meetings of the Directors.
The Directors may establish such offices and appoint such officers for the
Authority as they may deem appropriate.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-304) (from Ch. 122, par. 34A-304)
Sec. 34A-304.

Assistance by state agencies, units of local government or
school districts. The Board shall render such services to, and permit the
use of its facilities and resources by, the Authority at no charge as may
be requested by the Authority. Any state agency, unit of local government,
or school district may, within its respective function, render such
services to the Authority as may be requested by the Authority. Upon
request of the Authority any such agency, unit of local government or
school district is hereby authorized and empowered to transfer to the
Authority such officers and employees as the Authority may deem necessary
in carrying out its functions and duties. Officers and employees so
transferred shall not lose or forfeit their employment status or rights.

(Source: P.A. 85-1418; 86-1477.)
 
(105 ILCS 5/34A-305) (from Ch. 122, par. 34A-305)
Sec. 34A-305.
Compensation.
The Directors shall serve without compensation,
but each Director shall be entitled to reimbursement for actual and necessary
expenses incurred in the performance of official duties as a Director.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-306) (from Ch. 122, par. 34A-306)
Sec. 34A-306.
Meetings and records.
(a) The Governor shall call the first meeting of the Authority.
Thereafter, the Directors shall prescribe the times and places for their
meetings and the manner in which regular and special meetings may be
called. The Directors shall comply in all respects with "An Act in relation
to meetings", approved July 11, 1957, as now or hereafter amended. The
Authority shall be an Agency to which the Local Records Act, as amended,
applies.
(b) A majority of the Directors holding office shall constitute a quorum
for the conduct of business. The affirmative votes of at least 3 Directors
shall be necessary for adopting any rule or regulation, and for any other
action required by this Article to be taken by resolution, directive or
ordinance.
(c) The Authority and the State Superintendent of Education shall
cooperate with each other in the exercise of their respective powers under
The School Code. There shall be at least one annual meeting between the
Authority and the State Superintendent of Education in order to facilitate
cooperation and communication.

(Source: P.A. 85-1418; 86-1477.)
 
(105 ILCS 5/34A-401) (from Ch. 122, par. 34A-401)
Sec. 34A-401.
Approval of Financial Plan and Budget.
In carrying out the
purposes of this Article and pursuant to Sections 34A-402 through 34A-411,
as hereinafter provided, the Authority shall have the power to approve or
to reject the Financial
Plans, Budgets and contracts of the Board; provided, however, that the
Authority shall have no power to impair any existing contract or obligation of the
Board; and provided further, that with respect to any multi-year
employment contract or collective bargaining agreement authorized or
entered into pursuant to Section 34-49 or the Illinois Educational Labor
Relations Act, as now or hereafter amended, the Authority's power to
approve or reject the same shall be limited to the first year of such
contract or agreement as provided in Section 34A-405. Except as provided
in Section 34A-403 with regard to revenue estimates,
the Authority shall have no power to amend or reject in part any Financial
Plan, Budget or contract presented to the Authority for its approval.

(Source: P.A. 84-1057.)
 
(105 ILCS 5/34A-401.1) (from Ch. 122, par. 34A-401.1)
Sec. 34A-401.1.
Limitation.
Notwithstanding the provisions of any
other law to the contrary, the Authority shall have no power to reject the
Financial Plans, Budgets and Contracts of the Board for the failure of the
Board to keep reserves in excess of $5,000,000.

(Source: P.A. 83-1130.)
 
(105 ILCS 5/34A-402) (from Ch. 122, par. 34A-402)
Sec. 34A-402.
Balanced budget.
The Board's budget for its fiscal year
ending in 1982 and for each subsequent fiscal year shall be balanced in
accordance with an accounting system and procedure to be prescribed by the
Authority, with substantial progress toward balancing the budget to be
achieved in each of the preceding fiscal years; provided, however, that (1)
for the fiscal year of the Board ending in
1992, the aggregate amount of
the reserved fund balances required to be maintained by the Board
under its
budget for that fiscal year as last balanced by the Board and approved by
the Authority prior to the effective date of this amendatory Act of 1992 in
accordance with the accounting system and procedure prescribed by the
Authority is hereby reduced by $13,266,200, (2) the $13,266,200 released
from reserved fund balance requirements in fiscal year 1992 by this
amendatory Act of 1992 shall be available to the Board for appropriation by
it for any lawful school purpose during its fiscal year ending in 1992, and
(3) the Authority shall not require the $13,266,200 released from reserved
fund balance requirements in fiscal year 1992 by this amendatory Act of
1992 to be restored by the Board under any regular, supplemental or amended
budget adopted for any fiscal year ending in 1992 or thereafter.
For the fiscal year of the Board ending in 1994, the aggregate amount of
the reserved fund balances required to be maintained by the Board under its
budget for that fiscal year in accordance with the accounting system and
procedure prescribed by the Authority as of the effective date of this
amendatory Act of 1993 is hereby reduced by $22,000,000. The $22,000,000
released from reserved fund balance requirements in fiscal year 1994 by this
amendatory Act of 1993 shall be available to the Board for appropriation by it
for any lawful school purpose during its fiscal year ending in 1994. The
Authority shall not require the $22,000,000 released from reserved fund balance
requirements in fiscal year 1994 by this amendatory Act of 1993 to be restored
by the Board under any regular, supplemental or amended budget adopted for any
fiscal year ending in 1994 or thereafter. This reduction in the required
reserved fund balance is in addition to the reduction made by Public Act
87-838.
For the fiscal year of the Board ending in 1994, the aggregate amount of
the reserved fund balances required to be maintained by the Board under its
budget for that fiscal year in accordance with the accounting system and
procedure prescribed by the Authority as of the effective date of this
amendatory Act of 1993 is hereby reduced to $100,000,000. The reserved fund
balances required to be maintained in each subsequent fiscal year shall not
exceed $100,000,000.

(Source: P.A. 87-838; 88-89; 88-511.)
 
(105 ILCS 5/34A-403) (from Ch. 122, par. 34A-403)
Sec. 34A-403.
Financial Plans.
The Board shall develop, adopt and submit
to the Authority on or before March 1, 1980, for approval by the Authority,
an initial Financial Plan with respect to the remaining portion of the
Fiscal Year ending in 1980 and for the two succeeding Fiscal Years. The
Board shall develop and adopt subsequent Financial Plans in accordance with
this Section. Beginning with the Fiscal
Year beginning in 1993, and every second year thereafter, the Board shall adopt
a Financial Plan covering a period of 2 fiscal years. After adoption by
the Board, the Board shall submit each plan to the Authority for its approval
not later than 30 days prior to the commencement of the first Fiscal
Year to
which the Financial Plan relates, except that the Financial Plan to be
developed for the Fiscal Years beginning in 1993 and 1994 shall be submitted to
the Authority within 90 days of the effective date of this amendatory Act of
1993.
The Authority shall approve or reject the Financial Plan within 15
days of its
receipt of the Financial Plan from the Board. No Financial Plan shall have
force or effect without approval of the Authority. Each Financial Plan shall
be developed, submitted, approved and monitored in accordance with the
following procedures:
(a) The Board shall determine and submit to the Authority, at a time and
in a manner prescribed by the Authority, estimates of revenues available
to the Board during the period for which the Financial Plan is to be in
effect. The Authority shall approve, reject or amend the revenue estimates.
In the event the Board fails, for any reason, to submit to the Authority
estimates of revenue as required by this paragraph, the Authority may prepare
such estimates. The Financial Plan submitted by the Board shall be based
upon revenue estimates approved or prepared by the Authority.
As soon as practicable following the establishment of the Authority, the
President of the Board shall, at the request of the Chairman of the Authority,
make available to the Chairman of the Authority copies of the audited financial
statements and of the books and records of account of the Board for the
preceding 5 fiscal years of the Board.
(b) Each Financial Plan for each Fiscal Year or part thereof to which
it relates, shall contain (i) a description of revenues and expenditures,
provision for debt service, cash resources and uses, and capital improvements,
each in such manner and detail as the Authority shall prescribe, (ii) a
description of the means by which the Budget will be brought into balance
in accordance with Section 34A-402 of this Article,
and (iii) such other matters that the Authority, in its discretion, requires.
The initial Financial Plan shall also include a description of the means
by which any outstanding short-term indebtedness shall be paid or refunded
by the Board. The Authority may prescribe any reasonable time, standards,
procedures or forms consistent with this Section for preparation and
submission of the Financial Plan.
(c) The Authority shall approve the initial and each subsequent Financial
Plan if, in its
judgment, the plan is complete, is reasonably capable of being achieved,
and meets the requirement set forth in Section 34A-402 of this Article.
Otherwise, the Authority shall reject the Financial
Plan. In the event of rejection, the Authority may prescribe a procedure
and standards for revision of the Financial Plan by the Board.
(d) The Board shall report to the Authority, at such times and in such
manner as the Authority may direct, concerning the Board's compliance with
each Financial Plan. The Authority may review the Board's operations, obtain
budgetary data and financial statements, require the Board to produce reports,
and have access to any other information in the possession of the Board
that it deems relevant. The Authority may issue recommendations or directives
within its powers to the Board to assure compliance with the Financial Plan.
The Board shall produce such budgetary data, financial statements, reports
and other information and comply with such directives.
(e) After approval of each Financial Plan, the Board shall regularly
reexamine the revenue and expenditure estimates on which it was based and
revise them as necessary. The Board shall promptly notify the Authority of any
material change in the revenue or expenditure estimates in the Financial Plan.
The Board may submit to the Authority, or the Authority may require the Board
to submit, modified Financial Plans based upon revised revenue or expenditure
estimates or for any other good reason. The Authority shall approve or reject
each modified Financial Plan pursuant to paragraph (c) of this Section.

(Source: P.A. 88-511.)
 
(105 ILCS 5/34A-403.1)
Sec. 34A-403.1.
Fiscal year 1994 contracts.
Notwithstanding any provision
of this Article to the contrary, the failure of a Board to have a Financial
Plan approved by the School Finance Authority within 90 days after the
effective date of this amendatory Act of 1993 shall not impair the Board's
power to enter into any contract or other obligation or the Authority's powers
and responsibilities under Sections 34A-404, 34A-405, and
34A-405.2 or in any other way affect the operations of the Board.

(Source: P.A. 92-651, eff. 7-11-02.)
 
(105 ILCS 5/34A-404) (from Ch. 122, par. 34A-404)
Sec. 34A-404. Budgets. The Board shall develop and adopt and submit to
the Authority on or before February 1, 1980, for approval by the Authority,
a revised Budget for the remaining portion of the Fiscal Year ending in 1980
and, thereafter, an annual Budget for each Fiscal Year. After adoption
by the Board, the Board shall submit each Budget to the Authority for its
approval not later than 30 days prior to the commencement of the
Fiscal
Year to which the Budget relates. The Authority shall approve or reject
the Budget within 15 days of its receipt from the Board. No Budget
shall
have force or effect without approval of the Authority. Each Budget shall
be developed, submitted, approved and monitored in accordance with
the following procedures:
(Source: P.A. 100-201, eff. 8-18-17.)
 
(105 ILCS 5/34A-405) (from Ch. 122, par. 34A-405)
Sec. 34A-405.
Contracts.
(a) No contract or other obligation shall be
entered into by the Board unless it is consistent with the Financial Plan
and Budget in effect. No
multi-year employment contract or collective bargaining agreement
authorized or entered into pursuant to Section 34-49 or the Illinois
Educational Labor Relations Act, as now or hereafter amended, shall, with
respect to any terms and provisions thereof which are operative after
expiration of the first year of any such contract or agreement, be deemed
inconsistent with any Financial Plan and Budget at any time in effect;
provided, however, that any
terms and provisions of a contract or agreement which would increase
expenditures for salaries, benefits or other forms of compensation after
the expiration of the first year of such contract or agreement shall be
contingent upon the attainment of sufficient available revenues,
considering all necessary expenditures, to support such increases.
(b) The Authority may adopt, and from time to time amend, regulations
identifying categories and types of contracts and other obligations that
shall be subject to approval by the Authority and the procedure for submitting
contracts for approval. Each contract or other obligation that is entered
into by the Board and requires approval by the Authority shall contain a
provision stating that it shall not become legally binding on the Board
unless and until it has received the approval of the Authority. No contract
or other obligation that requires the approval of the Authority shall be
legally binding on the Board unless and until it has received such approval.
The Authority shall not, either by regulation or in practice, withhold
approval of any multi-year employment contract or collective bargaining
agreement authorized or entered into pursuant to Section 34-49 or the Illinois
Educational Labor Relations Act, as now or hereafter amended, if, in the
judgment of the Authority, the terms and provisions operative during the
first year of such contract or agreement are consistent with the Budget and
Financial Plan in effect for that period; provided, however, that any terms
and provisions of a contract or
agreement which would increase
expenditures for salaries, benefits or other forms of compensation after
the expiration of the first year of such contract or agreement shall be
contingent upon the attainment of sufficient available revenues,
considering all necessary expenditures, to support such increases.
(c) The Board shall submit to the Authority a copy of any contract or
other obligation for which the approval of the Authority is required, along
with a cost analysis and such other information as the Authority may require.
The Authority may prescribe any reasonable time, standards, procedures or
forms for submission of the contract or other obligation.
(d) The Authority shall approve the contract or obligation if, in its
judgment, the information required to be submitted is complete and the contract
or other obligation is consistent with the Budget and Financial Plan in
effect. Otherwise, the Authority shall reject the contract or other
obligation; provided, however, that any multi-year employment contract or
collective bargaining agreement authorized or entered into pursuant to
Section 34-49 or the Illinois Educational Labor Relations Act, as now or
hereafter amended, shall be approved by the Authority if in its judgment
the terms and provisions operative during the first year of such contract
or agreement are consistent with the Budget and Financial Plan in effect
for that period; provided, however, that any
terms and provisions of a contract or agreement which would increase
expenditures for salaries, benefits or other forms of compensation after
the expiration of the first year of such contract or agreement shall be
contingent upon the attainment of sufficient available revenues,
considering all necessary expenditures, to support such increases.
Contracts or other obligations not rejected within 30 days after submission
to the Authority shall be considered approved, provided, however, that the
Authority shall have an additional 30 days to approve or reject the contract
or other obligation if it so advises the Board within the initial 30 day
period.

(Source: P.A. 84-1057.)
 
(105 ILCS 5/34A-405.1)
Sec. 34A-405.1.
Interim operations.
Notwithstanding any other provision
of law to the contrary, for the period September 1 through September 12, 1993,
the following provisions apply:
(Source: P.A. 88-473.)
 
(105 ILCS 5/34A-405.2)
Sec. 34A-405.2.
Staffing levels.
(a) No hiring or appointment of any person in any position by the Board, the
general superintendent, any other officer or employee of the Board, or any
local school council shall be made or entered into unless it is consistent with
the Financial Plan and Budget in effect and the staffing plan approved by the
Authority under this Section. The hiring or appointment of any person shall
not be binding on the Board unless and until it is in compliance with this
Section.
(b) The Board shall submit to the Authority for approval by the Authority a
staffing plan for the upcoming school year at the same time as the submission
of the Budget, except that the staffing plan for the fiscal
year ending in 1994 shall be submitted to the Authority within 90 days after
the effective date of this amendatory Act of 1993. The staffing plan shall be
accompanied by a
cost analysis and such other information as the Authority may require. The
Authority may adopt, and from time to time amend, regulations to implement this
Section and may prescribe standards, procedures, and forms for submission of
the staffing plan.
(c) The Authority shall approve the staffing plan if, in its judgment, the
information required to be submitted is complete and the staffing plan is
consistent with the Budget and Financial Plan in effect. Otherwise, the
Authority shall reject the staffing plan; in the event of rejection, the
Authority shall prescribe a procedure and standards for revision of the
staffing plan. The Authority shall act on the staffing plan at the same
time as the approval of the Budget, except that the staffing plan for the
fiscal year ending in 1994 shall be acted upon at the same time as approval of
the Financial Plan for that fiscal year.
(d) The Board shall report to the Authority, at such times and in such
manner as the Authority may direct, concerning the Board's compliance with each
staffing plan. The Authority may review the Board's operations, obtaining
budgetary data and financial statements, may require the Board to produce
reports, and shall have access to any other information in the possession of
the Board that it deems relevant. The Authority may issue recommendations or
directives within its powers to the Board to assure compliance with the
staffing plan. The Board shall produce such budgetary data, financial
statements, reports, and other information and shall comply with such
directives.
(e) After approval of each staffing plan, the Board shall regularly
reexamine the estimates on which it was based and revise them as necessary. The
Board shall promptly notify the Authority of any material change in the
estimates in the staffing plan. The Board may submit to the Authority, or the
Authority may require the Board to submit, modifications to the staffing plan
based upon revised revenue or expenditure estimates or for any other good
reason. The Authority shall approve or reject each modified staffing plan
pursuant to subsection (c) of this Section.

(Source: P.A. 88-511.)
 
(105 ILCS 5/34A-406) (from Ch. 122, par. 34A-406)
Sec. 34A-406.
Expenditures.
The Board shall meet its debt service obligations as they become due. No
other expenditure shall be made by the Board unless it is consistent with
the Financial Plan and Budget or a provisional budget provided for in Section
34A-404(c)(2), in each case as in effect.

(Source: P.A. 88-511.)
 
(105 ILCS 5/34A-406.1) (from Ch. 122, par. 34A-406.1)
Sec. 34A-406.1.

During the 1984-85 school year only, the number of education
fund positions for both teacher-certificated and career service personnel
employed by the Chicago Board of Education shall not exceed the previous
year's budgeted positions, as certified by the Chicago School Finance Authority.

(Source: P.A. 83-1131.)
 
(105 ILCS 5/34A-406.2)
Sec. 34A-406.2.

Interim Operations for Fiscal Year 1994 Pending Budget
Adoption and Approval. Notwithstanding any other provision of law to the
contrary, for the fiscal year of the Board ending in 1994 only, during the
period of 30 days after the effective date of this amendatory Act of 1993, the
Board of Education is not subject to Sec. 34A-406 and shall adopt an interim
appropriation authorizing the expenditure of funds consistent with the
provisions of this Section and of this amendatory Act of 1993. If the Board
fails to timely meet and satisfy items (1) through (3) of this Section, no
funds may be spent or disbursed and no obligations, commitments, or liabilities
incurred for any part of the 30-day period after the failure occurs.
(Source: P.A. 88-511.)
 
(105 ILCS 5/34A-407) (from Ch. 122, par. 34A-407)
Sec. 34A-407.
Approval of chief financial officer.
The Board shall appoint a chief financial officer subject to the approval
of the Authority. Either the Authority or the Board shall have the power
to remove the chief financial officer. The chief financial officer shall
have the responsibility for preparing and supervising the Budget and Financial
Plan of the Board and overseeing expenditures of the Board. The chief financial
officer shall report to the Board. The chief financial officer may
be granted the authority by the Board to hire a specific number of employees
to assist in meeting immediate responsibilities. Conditions of employment
for such personnel shall not be subject to the provisions of Section 34-85.

(Source: P.A. 82-485.)
 
(105 ILCS 5/34A-408) (from Ch. 122, par. 34A-408)
Sec. 34A-408.
Financial and managerial audits.
(a) The Authority may examine the business records and audit the
accounts of the Board or require that the Board examine its business records
and audit its accounts at such time and in such manner as the Authority may
prescribe. The Board shall appoint a certified public accountant annually,
approved by the Authority, to audit its financial statements.
(b) The Authority shall initiate and direct financial and managerial
assessments and similar analyses of the operations of the
Chicago Board of Education, as may be required by this Section or as may, in
the judgment of the Authority, assure sound and efficient financial management
of the Board.
(c) On or before April 1, 1994, the Authority shall assure completion of
assessments and analyses that:
Upon the completion of these required assessments, the Authority shall make
recommendations to the Board regarding improvements and changes that derive
from these assessments, which the Board should implement.
In conjunction with its budgetary submission to the Authority for the fiscal
year that ends in 1995, the Board shall demonstrate to the
satisfaction of the Authority that the recommendations requested by the
Authority have been implemented in whole or in part or, in the alternative, are
not capable of being implemented. In consideration of whether to approve or
reject the budget for the fiscal year that ends in 1995, the Authority shall
adjudge whether the Board has fully considered and responsibly proposed
implementation of the Authority's recommendations.
(d) On or before April 1, 1995, the Authority shall adopt and submit a
report to the General Assembly, the Governor, and the Chicago Board of
Education that reflects a comprehensive assessment of the financial status of
the Chicago Board of Education. The report shall include an expenditure
analysis of all special education
programs provided by the Board, which shall include the number of programs
available and student participation, the dollar amount spent on each program,
the program location, the availability of transportation for students
participating in the programs, and related expenditure recommendations.
In addition, the
report shall also include a review of all attendance centers for efficiency
purposes, which shall include the total number of attendance centers in use,
their capacities, and the number of students currently enrolled in the
attendance centers, and the attendance center long range capital needs (repair
and maintenance) based upon current and estimated future enrollments. A study
shall also be included on teacher/student ratios.
(e) The Authority shall initiate and direct a management audit of
the Board at least once every 2 years. The audit shall review the personnel,
organization, contracts, leases, and physical properties of the Board to
determine whether the Board is managing and utilizing its resources in an
economical and efficient manner. The audit shall determine the causes of any
inefficiencies or uneconomical practices, including inadequacies in internal
and administrative procedures, organizational structure, uses of resources,
utilization of real property, allocation of personnel, purchasing policies, and
equipment.

(Source: P.A. 88-511.)
 
(105 ILCS 5/34A-409) (from Ch. 122, par. 34A-409)
Sec. 34A-409.
Cash accounts and bank accounts.
(a) The Authority shall require the Board or any officer of the Board, including
the Board's treasurer or any person acting as the Board's official or ex
officio treasurer, to establish and maintain separate cash accounts and
separate bank accounts in accordance with such rules, standards and procedures
as the Authority may prescribe.
(b) The Authority shall have the power to assume exclusive administration
of the cash accounts and bank accounts of the Board, to establish and maintain
whatever new cash accounts and bank accounts it may deem appropriate, and
to withdraw funds from such accounts for the lawful expenditures of the Board.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-410) (from Ch. 122, par. 34A-410)
Sec. 34A-410.
Financial, management and budgetary structure.
Upon direction of the Authority, the Board shall reorganize the financial
accounts, management and Budgetary systems of the Board in whatever manner
the Authority deems appropriate to achieve greater financial responsibility
and to reduce financial inefficiency.
Except as provided in Sections 34A-501 through 34A-512 of this Act, the
Authority shall not have the power to affect the taxing authority or to
consolidate or reduce the
restricted debt service funds of the Board.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-411) (from Ch. 122, par. 34A-411)
Sec. 34A-411.

Termination and reinstatement of Authority's power under this
Article.
(a) The powers and responsibilities granted to or imposed upon the Authority
and the Board under Sections 34A-401 through 34A-410 of this Article shall
not be exercised after the Authority has certified to the Governor and the
Mayor that the Board has completed 6 successive Fiscal Years of balanced
Budgets pursuant to the accounting and other principles prescribed by the
Authority. Notwithstanding the foregoing sentence, Sections 34A-402, 34A-404,
34A-405, and 34A-408 shall continue in full force and effect after such
certification of the completion of 6 successive Fiscal Years of balanced
Budgets.
(b) Upon determination by the Authority and certification of the Authority
to the Governor and the Mayor that the Board has failed to adopt a balanced
Budget by August 15th immediately preceding the commencement of each Fiscal
Year or failed to achieve a balanced Budget for two successive Fiscal Years,
subsequent to a time in which the powers and responsibilities of the Authority
and the Board are not exercised pursuant
to paragraph (a) of this Section, the Authority and Board shall resume the
exercise of their respective powers and responsibilities pursuant to each
Section of this Article.
(c) Notwithstanding the provisions of subsections (a) and (b) of this
Section or any other provision of law to the contrary, the powers and
responsibilities granted to or imposed upon the Authority and the Board under
Sections 34A-401 through 34A-410 and Section 34A-606 are suspended until
December 31, 2010.

(Source: P.A. 93-488, eff. 8-8-03.)
 
(105 ILCS 5/34A-412) (from Ch. 122, par. 34A-412)
Sec. 34A-412.
(Repealed).

(Source: Repealed by P.A. 88-511.)
 
(105 ILCS 5/34A-413) (from Ch. 122, par. 34A-413)
Sec. 34A-413.
(Repealed).

(Source: Repealed by P.A. 88-511.)
 
(105 ILCS 5/34A-414) (from Ch. 122, par. 34A-414)
Sec. 34A-414.
(Repealed).

(Source: Repealed by P.A. 88-511.)
 
(105 ILCS 5/34A-415) (from Ch. 122, par. 34A-415)
Sec. 34A-415.
(Repealed).

(Source: Repealed by P.A. 88-511.)
 
(105 ILCS 5/34A-501) (from Ch. 122, par. 34A-501)
Sec. 34A-501.
Power to issue Bonds.
(a) The Authority may incur
indebtedness by the issuance of its negotiable full faith and credit
general obligation bonds (the "Bonds") in an amount not to exceed at any
time the sum of $695,000,000 (excluding Bonds to be issued to refund
outstanding Bonds) for the purpose of providing the Board with moneys
for ordinary and necessary expenditures for educational purposes,
maintenance of school facilities, and other operational needs of the
Board; payment of outstanding debt obligations of the Board and of the
City, the proceeds of which were used to provide financing for the
Board; providing or increasing a working cash fund as provided by paragraph
(d) of this Section 34A-501; providing the Board with moneys for school
construction and rehabilitation purposes as provided by paragraph (e) of
this Section; payment of fees for arrangements as provided by paragraph (c)
of Section 34A-502; payment of interest on Bonds; establishment of reserves to
secure Bonds; the payment of costs of issuance of Bonds; payment of principal
of or interest or redemption premium on any Bonds or notes of the Authority;
and all other expenditures of the Authority incidental to and necessary or
convenient for carrying out its corporate purposes and powers, and in an
additional amount not to exceed at any time the sum of $427,000,000 (excluding
Bonds to be issued to refund outstanding Bonds) for the purpose of providing
the Board with moneys for ordinary and necessary expenditures for educational
purposes, maintenance of school facilities, and other operational needs of the
Board; payment of fees for arrangements as provided by paragraph (c) of Section
34A-502; payment in connection with agreements or contracts entered into as
provided for in Section 7 of the Bond Authorization Act; payment of interest on
Bonds; establishment of reserves to secure
Bonds; the payment of costs of issuance of Bonds; payment of principal of or
interest or redemption premium on any Bonds or notes of the Authority; and all
other expenditures of the Authority incidental to and necessary or convenient
for carrying out its corporate purposes and powers. No more than $40,000,000
of proceeds of Bonds of the Authority shall be deposited in a working cash fund
as provided by paragraph (d) of this Section 34A-501. No more than $95,000,000
of proceeds of Bonds of the Authority shall be provided to the Board for school
construction and rehabilitation purposes; provided that not less than
$32,000,000 nor more than $37,000,000 of such proceeds shall be used by the
Board for constructing new school buildings or providing additions
to school buildings.
(b) The Authority may from time to time (i) issue Bonds to refund
any outstanding Bonds or notes of the Authority whether the Bonds or
notes to be refunded have or have not matured or become redeemable and (ii)
issue Bonds partly to refund Bonds or notes then outstanding and partly for
any other purpose hereinabove set forth.
(c) Bonds issued in accordance with paragraph (a) of this Section
may be issued in excess of any statutory limitation as
to debt, and may be issued without referendum.
(d) The Authority may create a working cash fund to provide working
cash for the Board. Amounts in the working cash fund shall be used by the
Authority to make loans from time to time to the Board to enable the Board
to cover anticipated cash flow deficiencies which it may experience within
the fiscal year of the Board in which the loan is made, all as and to the
extent determined by the Authority. The loans shall be made in such amounts
and upon such terms as the Board and the Authority shall agree. The Authority
shall not under any circumstance be obligated to make any such loan. No
interest need be charged on any such loan. The Board may pledge and assign
to the repayment of such loans and may apply to that repayment any particular
receipts of the Board which have not been pledged to the payment of any of
the Board's bonds, notes, tax anticipation warrants or state aid anticipation
certificates. Each loan shall be required to be repaid in full by the Board
within the fiscal year of the Board in which the loan was made and, in any
event, within 11 months from the date on which it was made. Interest and
other investment earnings on the working cash fund shall be deposited in
and shall be part of that fund. Whenever the Authority shall determine
that all or part of the working cash fund is no longer needed for making
loans to the Board as provided in this paragraph, the Authority shall reduce
the amount of the fund so that the amount in the fund does not exceed the
amount which the Authority determines is necessary for use for making future
loans to the Board as provided in this paragraph. Upon any such reduction
in the amount of the working cash fund and upon
its abolition, all amounts in excess of the amounts to remain in the fund
shall be deposited in the debt service fund established by the Authority
for the Bonds for use for paying principal of Bonds at their maturity or
on earlier redemption dates, redemption premium and any interest accruing
on those Bonds, all as the Authority shall determine and direct.
(e) For purposes of this Section, "school construction and
rehabilitation purposes" means constructing new school buildings and
rehabilitating and accomplishing the deferred maintenance existing as of
August 31, 1984, of school buildings, including, without limitation,
repairing, modernizing, providing additions to and facilities in, altering
and reconstructing school buildings and equipment.
Any interest or other investment earnings on proceeds of Bonds issued for
the purpose of providing the Board with moneys for school construction and
rehabilitation purposes shall be applied as provided in the resolution
authorizing such Bonds, which resolution shall require those earnings to
be used for the same purpose as the proceeds of those Bonds or for the
payment of principal of or interest or redemption premium on any Bonds,
either at maturity or an earlier redemption date. Application by the
Authority of any proceeds of Bonds issued for the purpose of providing the
Board with moneys for school construction and rehabilitation purposes,
or interest or other investment earnings thereon, shall be in the sole
judgment and discretion of the Authority, but no such moneys shall be so
provided unless the Authority shall have found and determined, in its sole
judgment and discretion, that such moneys are to be used for those purposes
and not for providing the Board with moneys for its ordinary and necessary
expenditures for educational purposes, maintenance of school facilities or
other operational needs. The Authority may, in making its findings and
determinations, rely upon information provided by or on behalf of the Board.
The Authority may from time to time make and amend regulations and issue
directives with respect to the use and application of such moneys.
The Authority may, at any time, in its sole judgment and discretion,
deposit unexpended proceeds of Bonds issued for the purpose of providing
the Board with moneys for school construction and rehabilitation purposes
or interest or other investment earnings thereon solely in a debt service
fund for any Bonds and shall apply such moneys to the payment of principal
of or interest or redemption premium on Bonds, at maturity or an earlier
redemption date. In the resolution authorizing Bonds, the
Authority may make commitments or covenants to holders of Bonds with
respect to such use of such unexpended proceeds and interest or other
investment earnings.

(Source: P.A. 88-511.)
 
(105 ILCS 5/34A-501.1)
Sec. 34A-501.1.
Additional bond authority.
Subject to the limitation
in additional amount authorized by this amendatory Act of 1993 in Section
34A-501, the Authority shall incur indebtedness by the issuance of its Bonds on
or after July 1, 1993 in principal amounts sufficient to provide the Board from
the proceeds of the Bonds the sum of $175,000,000 during the
Fiscal Year
beginning in 1993, and the sum of $203,000,000 during the Fiscal Year
beginning
in 1994, in each year for ordinary and necessary expenditures for educational
purposes, maintenance of school facilities, and other operational needs of the
Board. All sums provided to the Board from proceeds of Bonds issued on or
after July 1, 1993 shall be treated
as revenues of the Board in that fiscal year for all purposes.

(Source: P.A. 88-511.)
 
(105 ILCS 5/34A-502) (from Ch. 122, par. 34A-502)
Sec. 34A-502.
Terms of Bonds.
(a) Whenever the Authority desires or is required to issue
Bonds as provided in this Article, it shall adopt a
resolution designating the
amount of the Bonds to be issued, the purposes for which the proceeds of
the Bonds are to be used and the manner in which such proceeds shall be
held pending the application thereof. The Bonds shall be issued in the
corporate name of the Authority, shall bear such date or dates, and shall
mature at such time or times not exceeding 30 years from their date as such
resolution may provide; provided, however, that Bonds issued on or after July
1, 1993 shall mature on or before June 1, 2009. The Bonds may be issued as
serial bonds payable
in installments or as term bonds with sinking fund installments or
as a combination thereof as the Authority may determine in such resolution.
The Bonds shall be in such denominations of $1,000 or integral multiples
thereof. The Bonds shall be in such form, either coupon or registered,
carry such registration privileges, be executed in such manner, be payable
at such place or places and be subject to such terms of redemption at such
redemption prices, including premium, as such resolution may provide. The
Bonds shall be sold by the Authority at public sale. The Bonds shall be
sold to the highest and best bidders upon sealed bids. The Authority shall,
from time to time as Bonds are to be sold, advertise in at least 2 daily
newspapers, one of which is published in the City of Springfield and one in
the City of Chicago, for proposals to purchase Bonds. Each of such
advertisements for proposals shall be published at least ten days prior to
the date of the opening of the bids. The Authority may reserve the right
to reject any and all bids.
(b) Bonds issued prior to December 31, 1980 shall bear interest at such
rate or rates and at such price or prices as the Authority may approve in
the resolution authorizing the issuance of Bonds. Bonds issued after December
31, 1980 shall bear interest at a rate or rates not to exceed the maximum
annual rate provided for in Section 2 of "An Act to authorize public
corporations to issue bonds, other evidences of indebtedness
and tax anticipation warrants subject to interest rate limitations set forth
therein", approved May 26, 1970, as amended, and if issued at such maximum
annual rate shall be sold for not less than par and accrued interest. If any of
the Bonds are issued to bear interest at a rate of less than such maximum annual
rate the minimum price at which they may be sold shall be such that the
interest cost to the Authority on the proceeds of the Bonds shall not exceed
such maximum annual rate computed to stated maturity according to standard
tables of bond values.
(c) In connection with the issuance of its Bonds, the Authority may
enter into arrangements to provide additional security and liquidity for
the Bonds. These may include, without limitation, municipal bond
insurance, letters of credit, lines of credit by which the Authority may
borrow funds to pay or redeem its Bonds and purchase or remarketing
arrangements for assuring the ability of owners of the Authority's Bonds to
sell or to have redeemed their Bonds. The Authority may enter into
contracts and may agree to pay fees to persons providing such arrangements,
including from Bond proceeds but only under circumstances in which the
total interest paid or to be paid on the Bonds, together with the fees for
the arrangements (being treated as if interest), would not, taken together,
cause the Bonds to bear interest, calculated to their absolute maturity, at
a rate in excess of the maximum rate allowed by law.
The resolution of the Authority authorizing the issuance of its Bonds may
provide that interest rates may vary from time to time depending upon
criteria established by the Authority, which may include, without
limitation, a variation in interest rates
as may be necessary to cause Bonds to be remarketable from time to time at
a price equal to their principal amount, and may provide for appointment of
a national banking association, bank, trust company, investment banker or
other financial institution to serve as a remarketing agent in that
connection. The resolution of the Authority authorizing the issuance of
its Bonds may provide that alternative interest rates or provisions will
apply during such times as the Bonds are held by a person providing a
letter of credit or other credit enhancement arrangement for those Bonds.

(Source: P.A. 88-511.)
 
(105 ILCS 5/34A-503) (from Ch. 122, par. 34A-503)
Sec. 34A-503.
Tax levy.
(a) Before or at the time of issuing any Bonds, the Authority shall provide by resolution for the levy and collection of a direct annual tax upon all
the taxable property located within the school district without limit as
to rate or amount sufficient to pay
and discharge the principal thereof at maturity or on sinking fund installment
dates and to pay the interest thereon as it falls due. The taxes as levied
shall also include such additional amounts to the extent that the collections
in the prior years were insufficient to pay and discharge such principal
thereof at maturity, such sinking fund installments, if any, and interest
thereon as it fell due and the amount so collected shall be placed in the
debt service reserve fund. Such tax shall be in
addition to and exclusive of the maximum of all taxes
which the Authority, the Board or the City Council of the City is now, or
may hereafter be, authorized by law to levy for any and all school purposes.
Any such resolution shall be in force upon its adoption.
(b) Such levy shall be for the sole benefit of the holders of the Bonds
and the holders of the Bonds shall have a security interest in, and lien
upon, all rights, claims and interests of the Authority arising pursuant
to such levy and all present and future proceeds of such levy until principal
of and sinking fund installments and interest on the Bonds are paid in full.
All proceeds from such levy shall be deposited by each county collector
directly in the debt service funds established pursuant to Section
34A-504 hereof and shall be applied solely for the payment of principal of and
sinking fund installments and interest on the Bonds and shall not be used for
any other purpose.
A levy with respect to Bonds issued prior to July 1, 1993 (or to refund or
continue the refunding of Bonds issued prior to July 1, 1993) shall be for the
sole benefit of holders of Bonds issued prior to July 1, 1993 (or to refund or
continue the refunding of Bonds issued prior to July 1, 1993). A levy with
respect to Bonds issued on or after July 1, 1993 (other than to refund or to
continue the refunding of Bonds issued prior to July 1, 1993) shall be for the
sole benefit of owners of Bonds issued on or after July 1, 1993 (other than to
refund or to continue the refunding of Bonds issued prior to July 1, 1993).
Proceeds of taxes levied under this Section shall be deposited in the debt
service fund relating to the Bonds with respect to which the taxes were
levied.
(c) Upon the filing in the office of the county clerk of each county wherein
the Board is located of a duly certified copy of any such ordinance, it
shall be the duty of each such county clerk to extend the tax therein provided
for, including an amount determined by the Authority to cover loss and cost
of collection and also deferred collections thereof and abatements in the
amount of such taxes as extended on the collectors' books. The tax shall
be separate and apart from all other taxes of the Authority, the Board and
the City and shall be separately identified by the collectors.

(Source: P.A. 88-511.)
 
(105 ILCS 5/34A-504) (from Ch. 122, par. 34A-504)
Sec. 34A-504.
Debt service fund.
(a) The Authority shall establish a
debt service fund for the Bonds to be maintained by a corporate trustee
(which may be any trust company or bank having the power of a trust
company within the State) separate and segregated from all other funds
and accounts of the Authority and the Board. All moneys on deposit in
the debt service fund shall be held in trust in such debt service fund
for the benefit of holders of the Bonds, shall be applied solely for the
payment of principal of and sinking fund installment, redemption premium,
if any, and interest on the Bonds and shall not be used for any other purpose.
The holders of the Bonds shall have a security interest in and lien upon all
such moneys.
(b) The Authority shall, by its resolution authorizing Bonds to be issued
on or after July 1, 1993 (other than to refund or to continue the refunding of
Bonds issued prior to July 1, 1993), establish a debt service fund which shall
be separate from any such fund for Bonds issued prior to July 1, 1993
(including Bonds
issued to refund or to continue the refunding of those prior Bonds). Such a
separate debt service fund shall secure only Bonds issued on or after July 1,
1993 (other than Bonds to refund or to continue the refunding of Bonds issued
prior to July 1, 1993). The debt service fund established with respect to
Bonds issued prior to July 1, 1993 (or to refund or to continue the refunding
of Bonds issued prior to July 1, 1993) shall not secure Bonds issued on or
after July 1, 1993 (other than Bonds issued to refund or to continue the
refunding of Bonds issued prior to July 1, 1993).

(Source: P.A. 88-511.)
 
(105 ILCS 5/34A-505) (from Ch. 122, par. 34A-505)
Sec. 34A-505.
Debt service reserve fund.
(a) The Authority may create
and establish a debt service reserve fund to be maintained by a corporate
trustee (which may be any trust company or bank having the power of a trust
company within the State) separate and segregated from all other funds and
accounts of the Authority. The Authority may pay into such debt service
reserve fund:
(b) The amount to be accumulated in the debt service reserve fund shall
be determined by the Authority but shall not exceed the maximum amount of
interest, principal and sinking fund installments due in any succeeding
calendar year.
(c) All moneys on deposit in such debt service reserve fund shall be held
in trust for the benefit of holders of the Bonds, shall be applied solely
for the payment of principal of and sinking fund installments and interest
on the Bonds to the extent not paid from the debt service fund and shall
not be used for any other purpose.
(d) Any moneys in the debt service reserve fund in excess of the amount
determined by the Authority pursuant to a resolution authorizing the issuance
of Bonds may be withdrawn by the Authority and used for
any of its lawful purposes.
(e) In computing the amount of the debt service reserve fund, investments
shall be valued as the Authority shall provide in the resolution authorizing
the issuance of the Bonds.
(f) The Authority may by its resolution authorizing Bonds to be issued on
or after July 1, 1993 (other than to refund or to continue the refunding of
Bonds issued prior to July 1, 1993) create and establish such a debt service
reserve fund, which shall be separate
from any such fund for Bonds issued prior to July 1, 1993 (including Bonds
issued to refund or to continue the refunding of those prior Bonds). Such a
separate debt service reserve fund shall secure only Bonds issued on or after
July 1,
1993 (other than to refund or to continue the refunding of Bonds issued
prior to July 1, 1993). The debt service reserve fund established with respect
to
Bonds issued prior to July 1, 1993 (or to refund or to continue the refunding
of Bonds issued prior to July 1, 1993) shall not secure Bonds issued on or
after July 1, 1993 (other than Bonds issued to refund or to continue the
refunding of Bonds issued prior to July 1, 1993).

(Source: P.A. 88-511.)
 
(105 ILCS 5/34A-506) (from Ch. 122, par. 34A-506)
Sec. 34A-506.
Bond Anticipation Notes.
(a) After the issuance of Bonds
shall have been authorized, the Authority shall have power to issue from
time to time, pursuant to a resolution or resolutions of the Authority,
its negotiable Bond Anticipation Notes in anticipation of the issuance of Bonds.
(b) Bond Anticipation Notes shall mature not later than 2 years after
the date of issuance, may be made redeemable prior to their maturity and
may be sold in such manner, in such denominations, at such price or prices,
and shall bear interest at such rate or rates not to exceed the maximum
annual rate in accordance
with the provisions of paragraph (b)of Section 34A-502 hereof, as a resolution
authorizing the issuance of the Bond Anticipation Notes may provide.
(c) The Bond Anticipation Notes may be made payable as to both principal
and interest from the proceeds of Bonds. The Authority may provide for
payment of interest on the Bond Anticipation Notes from direct annual taxes
upon all the taxable property located within the school district which are
hereby authorized to be levied annually for such purpose without limit as
to rate or amount sufficient to pay such interest as it falls due, in the
manner, subject to the security interest and lien and with the effect provided
in Section 34A-503 hereof.
(d) The Authority is authorized to issue renewal notes in the event it
is unable to issue Bonds to pay outstanding Bond Anticipation Notes on terms
the Authority deems reasonable.
(e) A debt service fund shall be established in the manner provided in
Section 34A-504 by the Authority for such Bond Anticipation Notes and the
proceeds of any tax levy made pursuant to this Section shall be deposited
therein upon receipt.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-507) (from Ch. 122, par. 34A-507)
Sec. 34A-507.
Resolution vesting powers in trustee.
The resolution
authorizing issuance of the Bonds shall vest in a trustee such rights,
powers and duties in trust as the Authority may determine and may contain
such provisions for protecting and enforcing the rights and remedies of the
holders of the Bonds and limiting such rights and remedies, as may be
reasonable and proper and not in violation of law, including covenants
setting forth the duties of the Authority in relation to the exercise of
its corporate powers and the custody, safeguarding and application of all
moneys. Such resolution shall provide for the manner in which moneys in
the various funds and accounts of the Authority may be invested in
Investment Obligations and the disposition of the earnings on such
investments.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-508) (from Ch. 122, par. 34A-508)
Sec. 34A-508.
Property of Authority exempt from taxation.
The property
of the Authority shall be exempt from taxation.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-509) (from Ch. 122, par. 34A-509)
Sec. 34A-509.
Discharge of Bonds.
(a) If the Authority shall pay or cause
to be paid to the holders of all Bonds and coupons, if any, then outstanding,
the principal of, redemption price, if any, and interest to become due thereon,
at the times and in the manner stipulated therein and in the resolution
authorizing the issuance of Bonds, then the covenants, agreements and other
obligations of the Authority to
the Bondholders shall be discharged and satisfied.
(b) Bonds or coupons or interest installments for the payment or redemption
of which moneys shall have been set aside and shall be held in trust by
the trustee provided for in Section 34A-507 hereof or any paying agent for
the Bonds (through deposit by the Authority of funds
for such payment or redemption or otherwise) at the maturity or redemption
date thereof shall be deemed to have been paid within the meaning and, with
the effect expressed in paragraph (a) above. All outstanding Bonds of any
series and all coupons, if any, appertaining to such Bonds shall, prior to the maturity
or redemption date thereof, be deemed to have been paid within the meaning
and with the effect expressed in such paragraph (a) above if (i) there shall
have been deposited with such trustee or paying agent either moneys in an
amount which shall
be sufficient, or direct obligations of the United States of America the
principal of and the interest on which, when due, will provide moneys which,
together with the moneys, if any, deposited with such trustee or paying
agent at the same time, shall be sufficient to pay, when due, the principal
of, sinking fund installment or redemption price, if applicable, and interest
due and to become due on
said Bonds on and prior to the redemption date, sinking fund installment
date, or maturity date thereof, as the case may be, and (ii) the Authority
shall have given such trustee or paying agent in form satisfactory to it
irrevocable instructions to publish a notice to the effect and in accordance
with the procedures provided in the resolution authorizing the issuance
of the Bonds. Neither direct obligations of the United States of America
nor moneys deposited with such trustee or paying agent nor principal or
interest payments on any such securities shall be withdrawn or used for any purpose
other than, and shall be held in trust for, the payment of the principal
or redemption price, if applicable, and interest on said Bonds.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-510) (from Ch. 122, par. 34A-510)
Sec. 34A-510.
Pledge of the State.
The State of Illinois pledges to and
agrees with the holders of Bonds that the State will not limit or alter
the rights and powers vested in the Authority by this Act with respect to
Sections 34A-501 through 34A-512 hereof so as to impair the terms of any
contract made by the Authority with such holders or in
any way impair the rights and remedies of such holders until the Bonds,
together with interest thereon, with interest on any
unpaid installments of interest, and all costs and expenses in connection
with any action or proceedings by or on behalf of such holders, are fully
met and discharged
or provisions made for their payment. The Authority is authorized to include
such pledge and agreement of the State in any resolution or contract with
the holders of Bonds.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-511) (from Ch. 122, par. 34A-511)
Sec. 34A-511.
Statutory lien.
Any pledge, assignment, lien or security
interest for the benefit of the holders of Bonds or Bond Anticipation Notes,
if any, created pursuant to this Act shall be valid and binding from the
time the Bonds are issued, without any physical delivery or further act,
and shall be valid and binding as against, and prior to any claims of, all
other parties having claims of
any kind in tort, contract or otherwise against the State, the Authority,
the Board or the City, or any other person, irrespective of whether such
other parties have notice thereof.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-512) (from Ch. 122, par. 34A-512)
Sec. 34A-512.
Complete authority.
This Act, without reference to any other
statute, shall be deemed full and complete authority for the issuance
of the Bonds and the Bond Anticipation Notes as hereinabove provided.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-601) (from Ch. 122, par. 34A-601)
Sec. 34A-601.
Hearings.
To the extent feasible, the Authority shall
provide for and encourage participation by the public in the development
and review of financial and educational policy. The Authority
shall hold public hearings as it may deem appropriate to the performance of
any of its functions. The Authority may designate one or more of its
Directors or may appoint one or more hearing officers to preside over any
hearing. The Authority shall hold public hearings as it may deem
appropriate to the performance of any of its functions. The Authority
shall have the power in connection with any such hearing to issue subpoenas
to require attendance of witnesses and the production of documents, and may
apply to any circuit court in the State to require compliance with such
subpoenas. Upon the request of the Authority, the Board shall provide the
facilities for and pay the expense of any hearing conducted by the Authority.

(Source: P.A. 85-1418; 86-1477.)
 
(105 ILCS 5/34A-602) (from Ch. 122, par. 34A-602)
Sec. 34A-602.
Limitations of actions after abolition; indemnification.
(a) Abolition of the Authority pursuant to Section 34A-605 shall bar any
remedy available against the Authority, its Directors, employees, or agents,
for any right or claim existing, or any liability incurred, prior to such
abolition unless the action or other proceeding thereon is commenced prior
to the expiration of 2 years after the date of such abolition.
(b) The Authority may indemnify any Director, officer, employee, or
agent who was or is a party, or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative by reason of the fact that he
was a Director, officer, employee or agent of the Authority, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action,
suit or proceeding, if he acted in good faith and in a manner he reasonably
believed to be in, or not opposed to the best interests of the Authority
and, with respect to any criminal action or proceeding, had no reasonable
cause to believe his conduct was unlawful. The termination of any action,
suit or proceeding by judgment, order, settlement, conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create
a presumption that the person did not act in good faith in a manner which
he reasonably believed to be in or not opposed to the best interest of the
Authority, and, with respect to any criminal action or proceeding, had reasonable
cause to believe that his conduct was unlawful.
To the extent that a Director, officer, employee or agent of the Authority
has been successful, on the merits or otherwise, in the defense of any such
action, suit or proceeding referred to in this subsection or in defense
of any claim, issue or matter therein, he shall be indemnified against expenses
(including attorney's fees) actually and reasonably incurred by him in connection
therewith. Any such indemnification shall be made by the Authority only
as authorized in the specific case, upon a determination that indemnification
of the Director, officer, employee or agent is proper in the circumstances
because he has met the applicable standard of conduct. Such determination
shall be made: (1) by the Board of Directors by a majority vote of a quorum
consisting of Directors who are not parties to such action, suit or proceeding,
or (2) if such a quorum is not obtainable, or, even if obtainable, a quorum
of disinterested Directors so directs, by independent legal counsel in a
written opinion.
Reasonable expenses incurred in defending an action, suit or proceeding
shall be paid by the Authority in advance of the final disposition of such
action, suit or proceeding, as authorized by the Board of Directors in the
specific case, upon
receipt of an undertaking by or on behalf of the Director, officer, employee
or agent to repay such amount, unless it shall ultimately be determined
that he is entitled to be indemnified by the Authority as authorized in this Section.
Any Director, officer, employee or agent against whom any action, suit
or proceeding is brought may employ his or her own attorney to appear on
his or her behalf.
The right to indemnification accorded by this Section shall not limit any
other right to indemnification to which the Director, officer, employee
or agent may be entitled. Any rights hereunder shall inure to the benefit
of the heirs, executors and administrators of any Director, officer, employee
or agent of the Authority.
The Authority may purchase and maintain insurance on behalf of any person
who is or was a Director, officer, employee or agent of the Authority against
any liability asserted against him and incurred by him in any such capacity,
or arising out of his status as such, whether or not the Authority would
have the power to indemnify him against such liability under the provisions
of this Section.

(Source: P.A. 82-97.)
 
(105 ILCS 5/34A-603) (from Ch. 122, par. 34A-603)
Sec. 34A-603.
State, City or Board not liable on Obligations.
Obligations issued under the provisions of this Article shall not be deemed
to constitute a debt or liability of the State, the City or the Board or
of any political subdivision thereof other than the Authority or a pledge
of the full faith and credit of the State, the City or the Board or of any
such political subdivision other than the Authority, but shall be payable
solely from the funds and revenues herein provided therefor. The issuance
of Obligations under
the provisions of this Article shall not directly or indirectly or contingently
obligate the State, the City or the Board or any political subdivision thereof
other than the Authority
to levy any form of taxation therefor or to make any appropriation for their
payment. Nothing in this Section contained shall prevent or be construed
to prevent the Authority from pledging its full faith and credit to the
payment of obligations authorized pursuant to this Article. Nothing in
this Article shall be construed to authorize the Authority to create a debt
of the State, the City or the Board within the meaning of the Constitution
or Statutes of Illinois and all Obligations issued by the Authority pursuant
to the provisions of this Article are payable and shall state that
they are payable solely from the funds and revenues pledged for their payment
in accordance with the resolution authorizing their issuance or in any trust indenture
or mortgage or deed of trust executed as security therefor. The State,
the City or the Board shall not in any event be liable for the payment of
the principal of or interest on any Obligations of the Authority or for
the performance of any pledge, mortgage, obligation or agreement of any
kind whatsoever which may be undertaken by the Authority. No breach of
any such pledge, mortgage, obligation or agreement may impose any liability
upon the State, the City or the Board or any charge upon their general credit
or against their taxing power.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-604) (from Ch. 122, par. 34A-604)
Sec. 34A-604. Abolition of Authority. The Authority shall be abolished one year after all its Obligations have
been fully paid and discharged or otherwise provided for. Upon the abolition
of the Authority, all of its rights and property shall pass to and be vested
in the Board.

(Source: P.A. 96-705, eff. 1-1-10.)
 
(105 ILCS 5/34A-605) (from Ch. 122, par. 34A-605)
Sec. 34A-605.
Obligations as legal investments.
The Obligations are hereby made securities in which all public officers
and bodies of this State and all political subdivisions of the State and
other persons carrying on an insurance business, all banks, bankers, trust
companies, saving banks and savings associations, including savings and
loan associations, building and loan associations, investment companies
and other persons carrying on a banking business, all credit unions, pension
funds, administrators, and guardians who are now or may hereafter be authorized
to invest in bonds or in other obligations of the State, may properly and
legally invest funds, including capital, in their control or belonging to
them. The Obligations are also
hereby made securities which may be deposited with and may be received by
all public officers and bodies of the State and all political subdivisions
of the State and public corporations for any purpose for which the deposit
of bonds or other obligations of the State is now or may hereafter be authorized.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-606) (from Ch. 122, par. 34A-606)
Sec. 34A-606. Reports.
(a) The Directors, upon taking office and annually thereafter, shall
prepare and submit to the Governor, Mayor, General Assembly, and City Council
a report which shall include the audited financial statement for the preceding
Fiscal Year of the Board, an approved Financial Plan or a statement of reasons
for the failure to adopt such a Financial Plan, a statement of the major
steps necessary to accomplish the objectives of the Financial Plan, and
a request for any legislation necessary to achieve the objectives of the
Financial Plan.
(b) Annual reports shall be submitted on or before May 1 of each year.
(c) The requirement for reporting to the General Assembly shall be
satisfied by filing copies of the report with the Board, the Governor,
the Mayor and as required
by Section 3.1 of the General Assembly Organization Act, and filing such
additional copies with the State Government Report Distribution Center for
the General Assembly as is required under paragraph (t) of Section 7 of the
State Library Act.
(d) Each annual report required to be submitted through May 1, 1995,
shall also include: (i) a description of the activities of the Authority;
(ii) an analysis of the educational performance of the Board for
the preceding school year; (iii) an Approved System-Wide Educational Reform
Goals and Objectives Plan or a statement of reasons for the failure to
adopt such an Approved System-Wide Educational Reform Goals and Objectives
Plan; (iv) a statement of the major steps necessary to accomplish the goals
of the Approved System-Wide Educational Reform Goals and Objectives Plan;
(v) a commentary with respect to those Board policies and rules and those
provisions of The School Code and collective bargaining agreements between
the Board and its employees which, in the opinion of the Authority, are
obstacles and a hindrance to fulfillment of any Approved System-Wide
Educational Reform Goals and Objectives Plan; and (vi) a request for any
legislative action necessary to achieve the goals of the Approved
System-Wide Educational Reform Goals and Objectives Plan.

(Source: P.A. 100-1148, eff. 12-10-18.)
 
(105 ILCS 5/34A-607) (from Ch. 122, par. 34A-607)
Sec. 34A-607.
Audit of Authority.
The Authority shall be subject to audit
in the manner now or hereafter provided for the audit of State funds and
accounts. A copy of the audit report shall be submitted to the Auditor
General, the Governor, the Speaker and Minority Leader of the House of Representatives
and the President and Minority Leader of the Senate.

(Source: P.A. 81-1221.)
 
(105 ILCS 5/34A-608) (from Ch. 122, par. 34A-608)
Sec. 34A-608.
Sanctions.
(a) No member, officer, employee, or agent of the Board shall commit the
Board to any contract or other obligation or incur any liability on behalf
of the Board for any purpose if the amount of such contract, obligation
or liability is in excess of the amount authorized for that purpose then
available under the Financial Plan and Budget then in effect.
(b) No member, officer, employee, or agent of the Board shall commit the
Board to any contract or other obligation on behalf of the Board for the
payment of money for any purpose required to be approved by the Authority
unless such contract or other obligation has been approved by the Authority.
(c) No member, officer, employee, or agent of the Board shall take any
action in violation of any valid order of the Authority or shall fail or
refuse to take any action required by any such order or shall prepare, present,
or certify any information (including any projections or estimates) or report
for the Authority or any of its agents that is false or misleading, or,
upon learning that any such information is false or misleading, shall fail
promptly to advise the Authority or its agents.
(d) In addition to any penalty or liability under any other law, any member,
officer, employee, or agent of the Board who shall violate subsections (a),
(b), or (c) of this Section shall be subject to appropriate administrative
discipline, including, if warranted, suspension from duty without pay,
removal from office, or termination of employment.

(Source: P.A. 85-1418; 86-1477.)

Structure Illinois Compiled Statutes