Bill Text: IL SB1770 | 2011-2012 | 97th General Assembly | Introduced

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Bill Title: Amends the Illinois Procurement Code. Provides that, for contracts with the State, a privately held entity that is exempt from Federal 10k reporting but has more than 200 (now, 400) shareholders may, in place of the prescribed disclosures, submit the information that Federal 10k reporting companies are required to report under federal regulations and list the names of any person or entity holding any ownership share greater than 5%. Effective immediately.

Spectrum: Bipartisan Bill

Status: (Failed) 2013-01-08 - Session Sine Die [SB1770 Detail]

Download: Illinois-2011-SB1770-Introduced.html

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97TH GENERAL ASSEMBLY State of Illinois 2011 and 2012 SB1770 Introduced 2/9/2011, by Sen. A. J. Wilhelmi SYNOPSIS AS INTRODUCED:
30 ILCS 500/50-35
Amends the Illinois Procurement Code. Provides that, for contracts with the State, a privately held entity that is exempt from Federal 10k reporting but has more than 200 (now, 400) shareholders may, in place of the prescribed disclosures, submit the information that Federal 10k reporting companies are required to report under federal regulations and list the names of any person or entity holding any ownership share greater than 5%. Effective immediately.
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FISCAL NOTE ACT MAY APPLY
A BILL FOR
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AN ACT concerning finance.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Procurement Code is amended by
changing Section 50-35 as follows:
(30 ILCS 500/50-35)
Sec. 50-35. Financial disclosure and potential conflicts
of interest.
(a) All offers from responsive bidders or offerors with an
annual value of more than $25,000, and all subcontracts
identified as provided by Section 20-120 of this Code, shall be
accompanied by disclosure of the financial interests of the
contractor, bidder, or proposer and each subcontractor to be
used. The financial disclosure of each successful bidder or
offeror and its subcontractors shall be incorporated as a
material term of the contract and shall become part of the
publicly available contract or procurement file maintained by
the appropriate chief procurement officer. Each disclosure
under this Section and Section 50-34 shall be signed and made
under penalty of perjury by an authorized officer or employee
on behalf of the bidder or offeror, and must be filed with the
Procurement Policy Board.
(b) Disclosure shall include any ownership or distributive

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income share that is in excess of 5%, or an amount greater than
60% of the annual salary of the Governor, of the disclosing
entity or its parent entity, whichever is less, unless the
contractor, bidder, or subcontractor (i) is a publicly traded
entity subject to Federal 10K reporting, in which case it may
submit its 10K disclosure in place of the prescribed
disclosure, or (ii) is a privately held entity that is exempt
from Federal 10k reporting but has more than 200 400
shareholders, in which case it may submit the information that
Federal 10k reporting companies are required to report under 17
CFR 229.401 and list the names of any person or entity holding
any ownership share that is in excess of 5% in place of the
prescribed disclosure. The form of disclosure shall be
prescribed by the applicable chief procurement officer and must
include at least the names, addresses, and dollar or
proportionate share of ownership of each person identified in
this Section, their instrument of ownership or beneficial
relationship, and notice of any potential conflict of interest
resulting from the current ownership or beneficial
relationship of each person identified in this Section having
in addition any of the following relationships:
(1) State employment, currently or in the previous 3
years, including contractual employment of services.
(2) State employment of spouse, father, mother, son, or
daughter, including contractual employment for services in
the previous 2 years.

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(3) Elective status; the holding of elective office of
the State of Illinois, the government of the United States,
any unit of local government authorized by the Constitution
of the State of Illinois or the statutes of the State of
Illinois currently or in the previous 3 years.
(4) Relationship to anyone holding elective office
currently or in the previous 2 years; spouse, father,
mother, son, or daughter.
(5) Appointive office; the holding of any appointive
government office of the State of Illinois, the United
States of America, or any unit of local government
authorized by the Constitution of the State of Illinois or
the statutes of the State of Illinois, which office
entitles the holder to compensation in excess of expenses
incurred in the discharge of that office currently or in
the previous 3 years.
(6) Relationship to anyone holding appointive office
currently or in the previous 2 years; spouse, father,
mother, son, or daughter.
(7) Employment, currently or in the previous 3 years,
as or by any registered lobbyist of the State government.
(8) Relationship to anyone who is or was a registered
lobbyist in the previous 2 years; spouse, father, mother,
son, or daughter.
(9) Compensated employment, currently or in the
previous 3 years, by any registered election or re-election

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committee registered with the Secretary of State or any
county clerk in the State of Illinois, or any political
action committee registered with either the Secretary of
State or the Federal Board of Elections.
(10) Relationship to anyone; spouse, father, mother,
son, or daughter; who is or was a compensated employee in
the last 2 years of any registered election or re-election
committee registered with the Secretary of State or any
county clerk in the State of Illinois, or any political
action committee registered with either the Secretary of
State or the Federal Board of Elections.
(b-1) The disclosure required under this Section must also
include the name and address of each lobbyist required to
register under the Lobbyist Registration Act and other agent of
the bidder or offeror who is not identified under subsections
(a) and (b) and who has communicated, is communicating, or may
communicate with any State officer or employee concerning the
bid or offer. The disclosure under this subsection is a
continuing obligation and must be promptly supplemented for
accuracy throughout the process and throughout the term of the
contract if the bid or offer is successful.
(b-2) The disclosure required under this Section must also
include, for each of the persons identified in subsection (b)
or (b-1), each of the following that occurred within the
previous 10 years: debarment from contracting with any
governmental entity; professional licensure discipline;

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bankruptcies; adverse civil judgments and administrative
findings; and criminal felony convictions. The disclosure
under this subsection is a continuing obligation and must be
promptly supplemented for accuracy throughout the process and
throughout the term of the contract if the bid or offer is
successful.
(c) The disclosure in subsection (b) is not intended to
prohibit or prevent any contract. The disclosure is meant to
fully and publicly disclose any potential conflict to the chief
procurement officers, State purchasing officers, their
designees, and executive officers so they may adequately
discharge their duty to protect the State.
(d) When a potential for a conflict of interest is
identified, discovered, or reasonably suspected, the chief
procurement officer or State procurement officer shall send the
contract to the Procurement Policy Board. The Board shall
recommend, in writing, whether to allow or void the contract,
bid, offer, or subcontract weighing the best interest of the
State of Illinois. All recommendations shall be submitted to
the chief procurement officer. The chief procurement officer
must hold a public hearing if the Procurement Policy Board
makes a recommendation to (i) void a contract or (ii) void a
bid or offer and the chief procurement officer selected or
intends to award the contract to the bidder or offeror. A chief
procurement officer is prohibited from awarding a contract
before a hearing if the Board recommendation does not support a

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bid or offer. The recommendation and proceedings of any
hearing, if applicable, shall become part of the contract, bid,
or proposal file and shall be available to the public.
(e) These thresholds and disclosure do not relieve the
chief procurement officer, the State purchasing officer, or
their designees from reasonable care and diligence for any
contract, bid, offer, or proposal. The chief procurement
officer, the State purchasing officer, or their designees shall
be responsible for using any reasonably known and publicly
available information to discover any undisclosed potential
conflict of interest and act to protect the best interest of
the State of Illinois.
(f) Inadvertent or accidental failure to fully disclose
shall render the contract, bid, proposal, subcontract, or
relationship voidable by the chief procurement officer if he or
she deems it in the best interest of the State of Illinois and,
at his or her discretion, may be cause for barring from future
contracts, bids, proposals, subcontracts, or relationships
with the State for a period of up to 2 years.
(g) Intentional, willful, or material failure to disclose
shall render the contract, bid, proposal, subcontract, or
relationship voidable by the chief procurement officer if he or
she deems it in the best interest of the State of Illinois and
shall result in debarment from future contracts, bids,
proposals, subcontracts, or relationships for a period of not
less than 2 years and not more than 10 years. Reinstatement

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after 2 years and before 10 years must be reviewed and
commented on in writing by the Governor of the State of
Illinois, or by an executive ethics board or commission he or
she might designate. The comment shall be returned to the
responsible chief procurement officer who must rule in writing
whether and when to reinstate.
(h) In addition, all disclosures shall note any other
current or pending contracts, proposals, subcontracts, leases,
or other ongoing procurement relationships the bidding,
proposing, offering, or subcontracting entity has with any
other unit of State government and shall clearly identify the
unit and the contract, proposal, lease, or other relationship.
(i) The contractor or bidder has a continuing obligation to
supplement the disclosure required by this Section throughout
the bidding process or during the term of any contract.
(Source: P.A. 95-331, eff. 8-21-07; 96-795, eff. 7-1-10 (see
Section 5 of P.A. 96-793 for the effective date of changes made
by P.A. 96-795); 96-920, eff. 7-1-10.)
Section 99. Effective date. This Act takes effect upon
becoming law.