SB2099ham003 101ST GENERAL ASSEMBLY

Rep. Michael J. Zalewski

Filed: 5/22/2020

 

 


 

 


 
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1
AMENDMENT TO SENATE BILL 2099

2    AMENDMENT NO. ______. Amend Senate Bill 2099 by replacing
3everything after the enacting clause with the following:
 
4    "Section 1. Short title. This Act may be cited as the
5Coronavirus Urgent Remediation Emergency Borrowing Act or the
6CURE Borrowing Act.
 
7    Section 5. Findings and purpose. The General Assembly finds
8that:
9    The State of Illinois is in the midst of both a public
10health emergency and a resultant fiscal crisis. The sudden
11worldwide outbreak of the Coronavirus Disease 2019 (COVID-19)
12and the spread of the disease in Illinois is causing dramatic
13economic upheaval and severe financial stress for individuals,
14businesses, health and other service providers, as well as the
15State and local governments across Illinois. It has resulted in
16declarations of disaster from both the Governor and the

 

 

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1President of the United States. The disaster has caused, and
2will continue to cause for some time to come, reductions in
3revenues for the State at the same time expenditures must be
4incurred to respond to the emergency. The State requires
5greater flexibility to borrow efficiently and respond
6effectively to urgent financial needs as they arise.
7    The federal government has responded to the COVID-19
8pandemic with the passage of legislation that provides
9emergency funding to state and local governments. One of the
10new funding programs, found in Section 4003 of the federal
11Coronavirus Aid, Relief, and Economic Stabilization Act (CARES
12Act) provides a Municipal Liquidity Facility administered by
13the Federal Reserve Bank with support from the United States
14Department of the Treasury, through which funds are being made
15available so that state and local governments may borrow funds
16directly from the program. The State of Illinois has the
17authority to participate in this program, any subsequent State
18and municipal financing program created by federal legislation
19to provide relief from the coronavirus pandemic (collectively
20"federal coronavirus financing legislation"), and any similar
21program that may be offered by the federal government or the
22Federal Reserve Bank.
23    The purpose of this Act is to revise the laws authorizing
24the State to borrow money and incur state debt so that the
25State will have needed flexibility in times of emergency, can
26borrow with enhanced efficiency in urgent circumstances, and

 

 

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1can effectively utilize new borrowing programs and facilities
2offered by the United States Department of the Treasury and the
3Federal Reserve Bank, all while maintaining stringent
4standards for accountability and transparency.
 
5    Section 10. Borrowing authorized.
6    (a) Borrowing under this Section is authorized under
7subsection (b) of Section 9 of Article IX of the Illinois
8Constitution. The Governor, with the approval of the
9Comptroller and Treasurer, is authorized to borrow funds from
10the Federal Reserve Bank or its agent in accordance with the
11Municipal Liquidity Facility program established pursuant to
12Section 4003 of the federal CARES Act and Section 13(3) of the
13Federal Reserve Act, or in accordance with any other federal
14coronavirus financing legislation or similar program
15authorized by the United States Congress. The purposes for
16which borrowing is authorized include:
17        (1) to meet failures of revenue resulting from the
18    COVID-19 outbreak and to support the emergency response
19    thereto;
20        (2) to provide funds for payment or reimbursement of
21    new or increased costs of State government resulting from
22    the COVID-19 outbreak and the emergency response thereto;
23        (3) to provide funds to respond to any other disaster
24    or emergency or failure of revenues or the costs of
25    essential government services;

 

 

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1        (4) to provide funds for deposit into the Healthcare
2    Provider Relief Fund for payment of costs payable from the
3    Fund; and
4        (5) to provide funds for payment or reimbursement of
5    costs payable from the Health Insurance Reserve Fund.
6    Proceeds of the borrowing may also be used to pay the costs
7of borrowing and the debts created by the borrowing.
8    (b) The Governor may borrow funds and contract debts from
9time to time, in principal amounts not to exceed $5,000,000,000
10outstanding at any time. Moneys thus borrowed shall be applied
11to any of the purposes described in this Section in accordance
12with properly enacted appropriations and transfers, or to pay
13the debts and associated expenses thus incurred, and to no
14other purpose. All proceeds from any borrowing under this Act,
15except those expended on the costs of issuance, shall be
16deposited into the Coronavirus Urgent Remediation Emergency
17Borrowing Fund (CURE Borrowing Fund). All moneys so borrowed
18shall be borrowed for no longer a time than the time limit set
19forth in federal program rules and guidance, and in no event
20longer than 10 years, and shall be repaid in equal principal
21payments or as required by federal program rules and guidance,
22if such requirements exist.
 
23    Section 15. Borrowing process.
24    (a) Whenever the borrowing of money under Section 10 is
25contemplated, the Director of the Governor's Office of

 

 

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1Management and Budget, acting at the direction of the Governor,
2shall prepare for such borrowing in one or more series, in
3amounts, at prices and at interest rates, and in such manner as
4directed by the Governor.
5    (b) The Director of the Governor's Office of Management and
6Budget, acting at the direction of the Governor, may negotiate
7and borrow directly from the Federal Reserve Bank or its agent
8in accordance with the Municipal Liquidity Facility program
9established pursuant to Section 4003 of the federal CARES Act
10and Section 13(3) of the Federal Reserve Act, or in accordance
11with any other federal coronavirus financing legislation or
12other program authorized by the United States Congress.
13    (c) The rate of interest on any borrowing pursuant to this
14Act shall not exceed the maximum rate authorized by the Bond
15Authorization Act, as amended at the time of the making of the
16contract. The requirements of the Illinois Procurement Code
17requiring competitive requests for proposal shall not apply to
18the selection of a lender in accordance with this Section.
 
19    Section 20. Bonds, notes, certificates or other
20facilities; appropriation.
21    (a) There shall be prepared, under the direction of the
22Governor, the form of bonds, notes, certificates or other
23facilities that the Governor deems advisable for borrowing
24pursuant to this Act. The bonds, notes, certificates or other
25facilities, when issued, shall be signed by the Governor and a

 

 

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1record of their issuance shall be kept by the Comptroller. The
2interest on and principal of the debt shall be paid from the
3General Obligation Bond Retirement and Interest Fund.
4    (b) There is appropriated on a continuing basis, out of any
5money in the State treasury, a sum sufficient for the payment
6of the interest on and principal of any debts contracted under
7this Act, and the irrevocable and continuing authority for and
8direction to the State Treasurer and the Comptroller to make
9the necessary transfers, as directed by the Governor.
10    (c) The Governor is authorized to order, pursuant to the
11proceedings authorizing debts contracted under this Act, the
12transfer of any moneys on deposit in the State treasury into
13the General Obligation Bond Retirement and Interest Fund at
14times and in amounts the Governor deems necessary to provide
15for the payment of that interest and principal.
16    (d) The Comptroller is authorized and directed to draw
17warrants on the State Treasurer for the amount of all payments
18of principal and interest on the bonds, notes, certificates or
19other facilities issued under this Act.
 
20    Section 50. The State Finance Act is amended by adding
21Sections 5.934 and 6z-123 as follows:
 
22    (30 ILCS 105/5.934 new)
23    Sec. 5.934. The Coronavirus Urgent Remediation Emergency
24Borrowing Fund (CURE Borrowing Fund).
 

 

 

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1    (30 ILCS 105/6z-123 new)
2    Sec. 6z-123. Coronavirus Urgent Remediation Emergency
3Borrowing Fund. The Coronavirus Urgent Remediation Emergency
4Borrowing Fund (CURE Borrowing Fund) is created as a special
5fund in the State treasury for the purpose of receiving
6proceeds from borrowings transacted pursuant to the
7Coronavirus Urgent Remediation Emergency Borrowing Act (CURE
8Borrowing Act) and for transferring and expending such moneys
9for the purposes authorized by that Act.
 
10    Section 55. The Short Term Borrowing Act is amended by
11changing Sections 1, 1.1, 2, and 3 as follows:
 
12    (30 ILCS 340/1)  (from Ch. 120, par. 406)
13    Sec. 1. Cash flow borrowing. Whenever significant timing
14variations occur between disbursement and receipt of budgeted
15funds within a fiscal year, making it necessary to borrow in
16anticipation of revenues to be collected in a fiscal year, in
17order to meet the same, the Governor, Comptroller and Treasurer
18may contract debts, in an amount not exceeding 5% of the
19State's appropriations for that fiscal year, and moneys thus
20borrowed shall be applied to the purpose for which they were
21obtained, or to pay the costs of borrowing and the debts thus
22created, and to no other purpose. All moneys so borrowed shall
23be repaid by the close of the fiscal year in which borrowed.

 

 

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1(Source: P.A. 88-669, eff. 11-29-94; 93-1046, eff. 10-15-04.)
 
2    (30 ILCS 340/1.1)
3    Sec. 1.1. Borrowing upon emergencies or failures in
4revenue. Whenever emergencies or failures in revenues of the
5State occur, in order to meet deficits caused by those
6emergencies or failures, the Governor, Comptroller, and
7Treasurer may contract debts in an amount not exceeding 15% of
8the State's appropriations for that fiscal year. The moneys
9thus borrowed shall be applied to the purposes for which they
10were obtained, or to pay the costs of borrowing and the debts
11thus created by the borrowing, and to no other purpose. Before
12incurring debt under this Section, the Governor shall give
13written notice to the Clerk of the House of Representatives,
14the Secretary of the Senate, and the Secretary of State setting
15forth the reasons for the proposed borrowing and the corrective
16measures recommended to restore the State's fiscal soundness.
17The notice shall be a public record and open for inspection at
18the offices of the Secretary of State during normal business
19hours. No debt may be incurred under this Section until 7 30
20days after the notice is served. All moneys so borrowed shall
21be borrowed for no longer time than one year.
22(Source: P.A. 88-669, eff. 11-29-94; 93-1046, eff. 10-15-04.)
 
23    (30 ILCS 340/2)  (from Ch. 120, par. 407)
24    Sec. 2. Sale of certificates. For borrowing authorized

 

 

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1under Sections 1 and 1.1 of this Act, certificates may be
2issued and sold from time to time, in one or more series, in
3amounts, at prices and at interest rates, all as directed by
4the Governor, Comptroller, and Treasurer. Bidders shall submit
5sealed bids to the Director of the Governor's Office of
6Management and Budget upon such terms as shall be approved by
7the Governor, Comptroller, and Treasurer after such notice as
8shall be determined to be reasonable by the Director of the
9Governor's Office of Management and Budget. The loan shall be
10awarded to the bidder offering the lowest effective rate of
11interest not exceeding the maximum rate authorized by the Bond
12Authorization Act as amended at the time of the making of the
13contract.
14    However, for borrowing authorized under Sections 1 and 1.1
15of this Act during fiscal years 2020 and 2021 only,
16certificates may be issued and sold on a negotiated basis
17rather than by sealed bid from time to time, in one or more
18series, in amounts, at prices and at interest rates, and in
19such manner, all as directed by the Governor, Comptroller, and
20Treasurer. The rate of interest must not exceed the maximum
21rate authorized by the Bond Authorization Act as amended at the
22time of the making of the contract. The requirements of the
23Illinois Procurement Code shall not apply to the selection of
24the purchaser of any certificates sold in accordance with the
25provisions of this paragraph.
26    With respect to instruments for the payment of money issued

 

 

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1under this Section either before, on, or after the effective
2date of this amendatory Act of 1989, it is and always has been
3the intention of the General Assembly (i) that the Omnibus Bond
4Acts are and always have been supplementary grants of power to
5issue instruments in accordance with the Omnibus Bond Acts,
6regardless of any provision of this Act that may appear to be
7or to have been more restrictive than those Acts, (ii) that the
8provisions of this Section are not a limitation on the
9supplementary authority granted by the Omnibus Bond Acts, and
10(iii) that instruments issued under this Section within the
11supplementary authority granted by the Omnibus Bond Acts are
12not invalid because of any provision of this Act that may
13appear to be or to have been more restrictive than those Acts.
14(Source: P.A. 88-669, eff. 11-29-94; 93-1046, eff. 10-15-04.)
 
15    (30 ILCS 340/3)  (from Ch. 120, par. 408)
16    Sec. 3. There shall be prepared under the direction of the
17officers named in this Act such form of bonds or certificates
18as they shall deem advisable, which, when issued, shall be
19signed by the Governor, Comptroller and Treasurer, and shall be
20recorded by the Comptroller in a book to be kept by him or her
21for that purpose. The interest and principal of such
22certificates loan shall be paid by the Treasurer treasurer out
23of the General Obligation Bond Retirement and Interest Fund.
24    There is hereby appropriated out of any money in the
25Treasury a sum sufficient for the payment of the interest and

 

 

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1principal of any debts contracted under this Act.
2    The Governor, Comptroller, and Treasurer are authorized to
3order pursuant to the proceedings authorizing those debts the
4transfer of any moneys on deposit in the treasury into the
5General Obligation Bond Retirement and Interest Fund at times
6and in amounts they deem necessary to provide for the payment
7of that interest and principal.
8    The Comptroller is hereby authorized and directed to draw
9his warrant on the State Treasurer for the amount of all such
10payments.
11    The directive authorizing borrowing under Section 1 or 1.1
12of this Act shall set forth a pro forma cash flow statement
13that identifies estimated monthly receipts and expenditures
14with identification of sources for repaying the borrowed funds.
15(Source: P.A. 101-275, eff. 8-9-19.)
 
16    Section 99. Effective date. This Act takes effect upon
17becoming law.".