IL HB4371

Amends the Water Authorities Act to allow water authorities to cease operations through annexation to a contiguous authority, consolidation with a coterminous municipality, or consolidation with the county (if authority is within one county) upon majority board vote and acceptance by the receiving governmental unit.

Transfers all assets, liabilities, property, bonding authority, and employees of a dissolved authority to the receiving governmental unit, with employee rights under contracts, collective bargaining agreements, and pension plans remaining unaffected.

Establishes a referendum process allowing any 500 electors within an authority's territory to petition for dissolution of authorities without outstanding revenue bonds, effective 4 years after creation.

Permits courts to order transfer of multiyear leased real property assets to another local government unit instead of liquidation, with compensation determined based on whether the same citizens will benefit from the asset after transfer.

Requires remaining funds after dissolution to be distributed to townships or counties based on the proportion of taxable real property value within each jurisdiction, and preserves the obligation to fulfill all bonds and contracts.