The ordinance amends Chapter 2-68 of the Municipal Code of Chicago by introducing a new section, 2-68-050, which establishes data residency requirements for City data. It mandates that any contract involving the storage of City data must ensure that such data is processed, stored, transmitted, and disposed of within the jurisdiction of the United States, prohibiting access from outside the country. Additionally, the ordinance provides a bid preference for contractors who store City data within Illinois or the City limits, offering a six percent preference for the former and an eight percent preference for the latter. Contractors who receive these preferences but fail to comply with the storage requirements will face fines equal to three times the amount of the bid incentive awarded.

Furthermore, the ordinance encourages all Sister Agencies, as defined in the Municipal Code, to adopt similar data residency policies. This initiative aims to enhance the security and control of City data by ensuring it remains within U.S. jurisdiction, thereby protecting it from potential external vulnerabilities. The ordinance will take effect upon its passage and publication.