TRANSMITTAL LETTER FOR BOARD MEETING OF DECEMBER 18, 2025
COMMITTEE ON STATE LEGISLATION AND RULES
The Honorable Kari K. Steele, President and Members of the Board of Commissioners
Title
Recommendations for the State of Illinois 2026 Legislative Program
Body
I respectfully submit the following legislative initiatives and recommendations to the Board of Commissioners for their consideration and guidance.
Legislative Initiative No. 1
Amend the District Act that authorizes implementation of the District’s industrial waste program, known as the Sewage & Waste Control Ordinance (SWCO).
The main changes to this section of the District Act on this initiative pertain to the daily civil penalty amounts and adding “per pollutant” and regulatory multiple day average violations to the civil penalties authorized by statute. This initiative will increase the civil penalty range for administrative show cause enforcements from $1,000-$2,000 per day of violation to $1,500-$5,000 per day of violation, and to the civil penalty range for circuit court enforcements from $1,000-$10,000 per day of violation to $1,500-$25,000 per day of violation.
Relative to “per-pollutant” and regulatory multiple day average violations, currently civil penalties are limited to “per-day” violations. This section of the statute would be amended so that civil penalties are also available for “per-pollutant” violations and regulatory multiple day violations. There are some additional technical changes that will allow staff to more effectively administer SWCO enforcement.
This initiative seeks to update the civil penalty range enacted by the Illinois General Assembly (ILGA) many years ago and increase the number of prosecutable offenses, with the goal of incentivizing industrial users to improve their pretreatment systems and comply with the District’s Sewage & Waste Control Ordinance.
Legislative Initiative No. 2
Amend the District Act to authorize pay raises for the Board of Commissioners (Board). The Board last received a pay raise that began to phase in in 2007.
This initiative would allow the Board to vote itself a one-time pay raise prior to January 1, 2027. The Board would need to approve its pay raise by a 2/3 vote of the Board at a public Board meeting.
Legislative Initiative No. 3
Amend the District Pension Code to change the 4.19 statutory multiplier to the Actuarially Determined Contribution (ADC); raise the taxable wage base on which employee contributions are made to satisfy Social Security “Safe Harbor,” concerns and allow the District to use any lawfully available revenue source to make its statutory contributions to the Retirement Fund.
Statutorily, the District is required “to levy a tax upon all taxable real property within the District that when extended will produce a sum that (i) will be sufficient to meet the Fund’s actuarially determined contribution requirement, but (ii) shall not exceed an amount equal to the total employee contributions 2 years prior multiplied by 4.19.” The 4.19x total employee contributions 2 years prior is commonly referred to as the “Multiplier,” and currently serves as a cap on the amount the District can levy as a tax on real property for the Retirement Fund. The Actuarially Determined Contribution (ADC) is the annual amount needed to get the District’s Retirement Fund to 100% funded by 2050.
In 2024, the amount generated by the Multiplier was $88.7 million as compared to the 2024 ADC which was $94.4 million thus requiring the District to use other revenues to meet the ADC. As the ADC grows over time the need to use other revenues to cover the gap between the multiplier and the ADC will impact the flexibility to use other revenues for any corporate fund needs. The District’s contributions under the Multiplier through 2050 are $2.6 billion while under the ADC, the District’s contribution would be $4.2 billion so the difference in switching from the current statutory cap of the Multiplier to the ADC is $1.6 billion through 2050. The consequence of not switching from the Multiplier to the ADC is that the Retirement Fund will be close to insolvency by 2050, while making the switch will get the Retirement Fund to 100% by 2050 based on current estimates.
When the Tier 2 pension system was created via Public Act 96-0889 (P.A. 96-0889), the cap on pensionable earnings was set at $106,800 and has only grown to $125,773.73 by 2024, i.e., it was not indexed for inflation. Additionally, P.A. 96-0889 set the minimum age for retirement for an unreduced annuity at 67 years of age or 62 years of age with at least 10 years of service with a pension reduction. The cost to the District for fixing the Tier 2 Safe Harbor issue is estimated at $188 million by 2050.
Consequently, the total cost of switching from the Multiplier to the ADC and fixing the Tier 2 Safe Harbor issue is approximately $1.8 billion.
For the District to be able to pay for these initiatives, the District will need to issue Pension Obligation Bonds (POBs). Public Act 102-0707 authorizes the District to issue up to $600,000,000 in POBs.
Another part of this initiative is to make the District’s Pension Code consistent with the District’s Act. Currently, the District Act allows the District to use interest earned on any money of the District as well as revenue from any lawfully available source to deposit into the Retirement Fund. This initiative will seek to add the same language to the District Pension Code. This change along with the use of POBs will provide the District the financial flexibility needed to ensure it can meet the contributions required to meet the goal of a 100% funded ratio of the Retirement Fund by 2050.
The statutory change replacing the Multiplier with the ADC is unique to the District’s Pension Code and the Tier 2 pension fix may become part of an omnibus pension bill covering multiple pension funds, hence the recommendation is to pursue these initiatives as two separate bills.
Legislative Initiative No. 4
Amend the Personnel Code of the District Act to address issues with the appointment of participants completing District apprentice programs, allow the District to conduct employment examinations more frequently and other technical changes.
There is currently a timing issue with apprentices completing the District apprentice program and their ability to participate in the civil service examination process. For the associated journeyman job classification this has resulted in some apprentice program participants completing the program and leaving the District to take full-time positions elsewhere. The recommended changes would provide these program participants an opportunity to participate in an examination and be placed on an eligible list immediately upon completion of the apprenticeship program.
Currently, there can be a long lead time between the administration of an employment examination, development of an eligible employment list and the offer of employment/appointment of job candidates from an eligible employment list. Given advancements in technology, the time-to-hire job market is significantly shorter. The District’s use of an eligible list based on an examination that may have been conducted several years ago has resulted in an increase in declinations on offers of employment and the depletion of eligible employment lists. The recommended changes would maintain the integrity of the examination process and allow the District to conduct examinations more frequently where appropriate. These changes will shorten the time between the examination, and the potential job offer, allowing the District to compete for the highest quality talent available in the job market.
Legislative Initiative No. 5
Amend the District Act to repeal Section 19 pertaining to potential District liability for rain induced flooding. Recent historical flooding has brought significant attention to the involvement of the District and other local governments in stormwater management, flood control and sewer design. This flooding has also resulted in several lawsuits being filed against the District under the theory that the District is liable for damages from flooding based on 70 ILCS 2605/19 (Section 19) of the District Act. Section 19 of the District Act was enacted in 1907 for purposes of addressing issues related to the construction of the Sanitary and Ship Canal, Cal-Sag, and North Shore Channel. While Section 19 was enacted for limited purposes surrounding the construction of these channels, creative lawyers have recently been attempting to use it to make the District liable for current flooding throughout Cook County.
While the District’s Law Department has been successful to date in defending these lawsuits, the Law Department has to devote a tremendous amount of staff time and resources towards aggressively defending these cases. Repealing Section 19 of the District Act would be consistent with court decisions and save the District a significant amount of staff time.
Legislative Initiative No. 6
Identify opportunities to support legislation pertaining to the following concepts: water reuse and PFAS.
It is anticipated that legislation may be introduced in the ILGA 2026 spring session pertaining to the above-referenced concepts. The Board has identified these concepts as being important policy considerations in which the District should seek opportunities to engage and support legislation that may be consistent with the District’s statutory mission pertaining to wastewater, stormwater, resource recovery and related services.
Specifically, House Bill 2955 (HB 2955) creates the PFAS Wastewater Citizen Protection Act. HB 2955 is an initiative of the Illinois Association of Wastewater Agencies (IAWA) and the District has been very involved with the drafting and advancing of HB 2955. On April 9, 2025, HB 2955 passed the Illinois House on a vote of 75-40. HB 2955 has been amended in the Senate where it currently remains. One of the Board members has proposed some additional changes to HB 2955 which have been forwarded to IAWA for inclusion in any additional Senate amendment. HB 2955 will pick up in the Senate as the ILGA 2026 Spring Session commences in mid-January.
In addition to HB 2955, it is recommended that the District support these legislative initiatives in concept subject to staff review of actual bill language filed in the ILGA. If such bills are filed in the ILGA, a future Board letter would be brought forward recommending support of specific bills.
Recommended, John P. Murray, Executive Director, JPM:STM:BO’C:nl
Disposition of this agenda item will be documented in the official Regular Board Meeting Minutes of the Board of Commissioners for December 18, 2025