by John E. Motylinski (Fall 2016)
On July 22, 2016, Governor Bruce Rauner signed into effect the Local Government Travel Expense Control Act (Public Act 99-604), which changes the way in which non-home rule local governments (including all fire protection districts) handle travel expense reimbursement for board members and employees. The Act follows in response to stories in the media about board junkets and excess entertainment expenses reimbursed by Illinois public bodies, most prominently the College of DuPage and the Matteson School District 159. The Act takes effect January 1, 2017.
Principally, the new law requires local governments to enact policies via resolution or ordinance on the reimbursement of all travel, meal, and lodging expenses for officers and employees. These policies must specify the types of official business for which travel, meal, and lodging expenses are allowed. Local governments must also specify the maximum allowable reimbursement for such expenses.
While the Act gives localities discretion to set a rate at which travel, meal, and lodging expenses are reimbursed, local governments should consider adopting those rates set by the federal Government Services Administration (GSA). Adoption of these rates obviates the need for the locality to conduct its own research into prevailing travel reimbursement rates. Furthermore, the GSA’s travel rates are continuously updated and are relied upon by the Internal Revenue Service for determining reasonable business travel expenses for tax purposes.
Under Section 10 of the Act, travel reimbursement policies must be enacted prior to June 30, 2017. Indeed, a public body that fails to approve a policy by June 30, 2017 is prohibited from making any travel, meal or lodging reimbursements. Nevertheless, local governments are encouraged to adopt their travel reimbursement policies before March 1, 2017, as the Act contains language in Section 15 that presupposes the locality will have a reimbursement policy implemented by March 1, 2017.
Once a travel expense reimbursement policy is put in place, governing bodies may approve the reimbursement before or after the travel occurs. Where employees seek reimbursement for travel expenses, they must submit statutorily-prescribed documentation to the governing body.
This documentation (which is expressly subject to disclosure under the Illinois Freedom of Information Act) must include:
- A receipt detailing travel, meals, or lodging costs if the expenses have been incurred, or an estimate of costs if they have not yet been incurred;
- The name and job title of the individual requesting the reimbursement; and
- The date of travel and a description of the event.
All expenses for travel, meals and lodging of any member of the governing board or corporate authorities of the public body must be approved by a separate detailed roll-call vote starting March 1, 2017.
Fortunately, the Act allows several provisions that provide flexibility to local governments in responding to extraordinary circumstances. First, the travel reimbursement ordinance or resolution may (and should) allow for approval of emergency expenses that exceed the maximum allowable reimbursement. Second, all travel, meal, and lodging expenses incurred by an officer or employee that exceed the policy’s maximum allowable reimbursement can be approved or ratified only by a roll call vote of the corporate authorities at an open meeting.
As a final matter, this Act provides a categorical ban on reimbursement for “entertainment” expenses. Under the Act, “entertainment” includes, but is not limited to, shows, amusements, theaters, circuses, sporting events, or any other place of public or private entertainment or amusement, unless ancillary to the purpose of the program or event. Therefore, entertainment costs may not be reimbursed by local governments moving forward.
In summary, the Local Government Travel Expense Control Act will require public agencies to enact a policy that defines procedures and rates for reimbursement of travel, meal, and lodging expenses. While the Act may appear simple, there are multiple considerations that must be taken into account. Accordingly, we recommend you consult with your attorneys if you have any questions concerning the impact of the Act or in generating a compliant travel reimbursement policy.