IL HB3708

Establishes new procedures for certifying and designating municipalities as financially distressed cities, allowing either municipal request or State Comptroller-initiated review based on specific financial stress indicators.

Creates a multi-member review team led by the State Comptroller to examine municipalities' financial conditions and submit findings within 60 days; Governor may then certify the municipality as financially distressed by proclamation.

Allows State Comptroller to conduct preliminary financial review when triggered by Department of Revenue certification, municipal/school board request, unpaid creditor claims exceeding $10,000 or 1% of budget, citizen petitions, pension payment failures, wage delays, bond defaults, or credit rating downgrades.

Waives state grant matching requirements for financially distressed cities and prohibits the distressed designation from negatively impacting state grant eligibility or award amounts (except when federal funds require matching).

Authorizes the Financial Advisory Authority to pursue court action against municipalities for material violations of the Division's requirements, following a 15-day cure period after written notice.