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1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Home Equity Assurance Act is amended by
5changing Section 11 as follows:
 
6    (65 ILCS 95/11)  (from Ch. 24, par. 1611)
7    Sec. 11. Guarantee Fund.
8    (a) Each governing commission and program created by
9referendum under the provisions of this Act shall maintain a
10guarantee fund for the purposes of paying the costs of
11administering the program and extending protection to members
12pursuant to the limitations and procedures set forth in this
13Act.
14    (b) The guarantee fund shall be raised by means of an
15annual tax levied on all residential property within the
16territory of the program having at least one, but not more than
176 dwelling units and classified by county ordinance as
18residential. The rate of this tax may be changed from year to
19year by majority vote of the governing commission but in no
20case shall it exceed a rate of .12% of the equalized assessed
21valuation of all property in the territory of the program
22having at least one, but not more than 6 dwelling units and
23classified by county ordinance as residential, or the maximum

 

 

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1tax rate approved by the voters of the territory at the
2referendum which created the program or, in the case of a
3merged program, the maximum tax rate approved by the voters at
4the referendum authorizing the merger, whichever rate is lower.
5The commissioners shall cause the amount to be raised by
6taxation in each year to be certified to the county clerk in
7the manner provided by law, and any tax so levied and certified
8shall be collected and enforced in the same manner and by the
9same officers as those taxes for the purposes of the county and
10city within which the territory of the commission is located.
11Any such tax, when collected, shall be paid over to the proper
12officer of the commission who is authorized to receive and
13receipt for such tax. The governing commission may issue tax
14anticipation warrants against the taxes to be assessed for the
15calendar year in which the program is created and for the first
16full calendar year after the creation of the program.
17    (c) The moneys deposited in the guarantee fund shall, as
18nearly as practicable, be fully and continuously invested or
19reinvested by the governing commission in investment
20obligations which shall be in such amounts, and shall mature at
21such times, that the maturity or date of redemption at the
22option of the holder of such investment obligations shall
23coincide, as nearly as practicable, with the times at which
24monies will be required for the purposes of the program. For
25the purposes of this Section investment obligation shall mean
26direct general municipal, state, or federal obligations which

 

 

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1at the time are legal investments under the laws of this State
2and the payment of principal of and interest on which are
3unconditionally guaranteed by the governing body issuing them.
4    (d) Except as permitted by this subsection and subsection
5(d-5), the guarantee fund shall be used solely and exclusively
6for the purpose of providing guarantees to members of the
7particular Guaranteed Home Equity Program and for reasonable
8salaries, expenses, bills, and fees incurred in administering
9the program, and shall be used for no other purpose.
10    A governing commission, with no less than $4,000,000 in its
11guarantee fund, may, if authorized by referendum duly adopted
12by a majority of the voters, establish a Low Interest Home
13Improvement Loan Program in accordance with and subject to
14procedures established by a financial institution, as defined
15in the Illinois Banking Act. Whenever the question of creating
16a Low Interest Home Improvement Loan Program is initiated by
17resolution or ordinance of the corporate authorities of the
18municipality or by a petition signed by not less than 10% of
19the total number of registered voters of each precinct in the
20territory, the registered voters of which are eligible to sign
21the petition, it shall be the duty of the election authority
22having jurisdiction over the municipality to submit the
23question of creating the program to the electors of each
24precinct within the territory at the regular election specified
25in the resolution, ordinance, or petition initiating the
26question. A petition initiating a question described in this

 

 

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1subsection shall be filed with the election authority having
2jurisdiction over the municipality. The petition shall be filed
3and objections to the petition shall be made in the manner
4provided in the Election Code. A resolution, ordinance, or
5petition initiating a question described in this subsection
6shall specify the election at which the question is to be
7submitted. The referendum on the question shall be held in
8accordance with the Election Code. The question shall be in
9substantially the following form:
10        "Shall the (name of the home equity program) implement
11    a Low Interest Home Improvement Loan Program with money
12    from the guarantee fund of the established guaranteed home
13    equity program?"
14The votes must be recorded as "Yes" or "No".
15    Whenever a majority of the voters on the public question
16approve the creation of the program as certified by the proper
17election authorities, the commission shall establish the
18program and administer the program with funds collected under
19the Guaranteed Home Equity Program, subject to the following
20conditions:
21        (1) At any given time, the cumulative total of all
22    loans and loan guarantees (if applicable) issued under this
23    program may not reduce the balance of the guarantee fund to
24    less than $3,000,000.
25        (2) Only eligible applicants may apply for a loan.
26        (3) The loan must be used for the repair, maintenance,

 

 

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1    remodeling, alteration, or improvement of a guaranteed
2    residence. This condition is intended to include the repair
3    or maintenance of a guaranteed residence's water and sewer
4    pipes and repair of a guaranteed residence, including but
5    not limited to basement repairs, following flooding damage
6    to the property. This condition is not intended to exclude
7    the repair, maintenance, remodeling, alteration, or
8    improvement of a guaranteed residence's landscape. This
9    condition is intended to exclude the demolition of a
10    current residence. This condition is also intended to
11    exclude the construction of a new residence.
12        (4) An eligible applicant may not borrow more than the
13    amount of equity value in his or her residence.
14        (5) A commission must ensure that loans issued are
15    secured with collateral that is at least equal to the
16    amount of the loan or loan guarantee.
17        (6) A commission shall charge an interest rate which it
18    determines to be below the market rate of interest
19    generally available to the applicant.
20        (7) A commission may, by resolution, establish other
21    administrative rules and procedures as are necessary to
22    implement this program including, but not limited to, loan
23    dollar amounts and terms. A commission may also impose on
24    loan applicants a one-time application fee for the purpose
25    of defraying the costs of administering the program.
26    (d-5) A governing commission, with no less than $4,000,000

 

 

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1in its guarantee fund, may, if authorized by referendum duly
2adopted by a majority of the voters, establish a Foreclosure
3Prevention Loan Fund to provide low interest emergency loans to
4eligible applicants that may be forced into foreclosure
5proceedings.
6    Whenever the question of creating a Foreclosure Prevention
7Loan Fund is initiated by resolution or ordinance of the
8corporate authorities of the municipality or by a petition
9signed by not less than 10% of the total number of registered
10voters of each precinct in the territory, the registered voters
11of which are eligible to sign the petition, it shall be the
12duty of the election authority having jurisdiction over the
13municipality to submit the question of creating the program to
14the electors of each precinct within the territory at the
15regular election specified in the resolution, ordinance, or
16petition initiating the question. A petition initiating a
17question described in this subsection shall be filed with the
18election authority having jurisdiction over the municipality.
19The petition shall be filed and objections to the petition
20shall be made in the manner provided in the Election Code. A
21resolution, ordinance, or petition initiating a question
22described in this subsection shall specify the election at
23which the question is to be submitted. The referendum on the
24question shall be held in accordance with the Election Code.
25The question shall be in substantially the following form:
26    "Shall the (name of the home equity program) implement a

 

 

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1Foreclosure Prevention Loan Fund with money from the guarantee
2fund of the established guaranteed home equity program?"
3    The votes must be recorded as "Yes" or "No".
4    Whenever a majority of the voters on the public question
5approve the creation of a Foreclosure Prevention Loan Fund as
6certified by the proper election authorities, the commission
7shall establish the program and administer the program with
8funds collected under the Guaranteed Home Equity Program,
9subject to the following conditions:
10        (1) At any given time, the cumulative total of all
11    loans and loan guarantees (if applicable) issued under this
12    program may not exceed $3,000,000.
13        (2) Only eligible applicants may apply for a loan. The
14    Commission may establish, by resolution, additional
15    criteria for eligibility.
16        (3) The loan must be used to assist with preventing
17    foreclosure proceedings.
18        (4) An eligible applicant may not borrow more than the
19    amount of equity value in his or her residence.
20        (5) A commission must ensure that loans issued are
21    secured as a second lien on the property.
22        (6) A commission shall charge an interest rate which it
23    determines to be below the market rate of interest
24    generally available to the applicant.
25        (7) A commission may, by resolution, establish other
26    administrative rules and procedures as are necessary to

 

 

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1    implement this program including, but not limited to,
2    eligibility requirements for eligible applicants, loan
3    dollar amounts, and loan terms.
4        (8) A commission may also impose on loan applicants a
5    one-time application fee for the purpose of defraying the
6    costs of administering the program.
7    (e) The guarantee fund shall be maintained, invested, and
8expended exclusively by the governing commission of the program
9for whose purposes it was created. Under no circumstance shall
10the guarantee fund be used by any person or persons,
11governmental body, or public or private agency or concern other
12than the governing commission of the program for whose purposes
13it was created. Under no circumstances shall the guarantee fund
14be commingled with other funds or investments.
15    (e-1) No commissioner or family member of a commissioner,
16or employee or family member of an employee, may receive any
17financial benefit, either directly or indirectly, from the
18guarantee fund. Nothing in this subsection (e-1) shall be
19construed to prohibit payment of expenses to a commissioner in
20accordance with Section 4 or payment of salaries or expenses to
21an employee in accordance with this Section.
22    As used in this subsection (e-1), "family member" means a
23spouse, child, stepchild, parent, brother, or sister of a
24commissioner or a child, stepchild, parent, brother, or sister
25of a commissioner's spouse.
26    (f) An independent audit of the guarantee fund and the

 

 

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1management of the program shall be conducted annually and made
2available to the public through any office of the governing
3commission or a public facility such as a local public library
4located within the territory of the program.
5(Source: P.A. 95-691, eff. 6-1-08.)