Public Act 103-0772
 
SB3077 EnrolledLRB103 36919 JAG 67033 b

    AN ACT concerning agriculture.
 
    Be it enacted by the People of the State of Illinois, 
represented in the General Assembly:
 
    Section 1. Short title. This Act may be cited as the Local 
Food Infrastructure Grant Act.
 
    Section 5. Definitions. In this Act:
    "Department" means the Department of Agriculture.
    "Director" means the Director of Agriculture.
    "Fund" means the Local Food Infrastructure Grant Fund.
    "Grant administrator" means the Department or a nonprofit 
organization that is exempt from taxation under Section 
501(c)(3) of the Internal Revenue Code, that represents 
farmers, and that has entered into a subcontract with the 
Department under Section 15 to administer the grant.
    "Grantee" means the person or entity to whom a grant is 
made from the Fund.
    "Lender" means a federal or State chartered bank, a 
federal land bank, a production credit association, a bank for 
cooperatives, a federal or State chartered savings and loan 
association, a federal or State chartered building and loan 
association, a small business investment company, or any other 
institution qualified within this State to originate and 
service loans, including, but not limited to, an insurance 
company, a credit union, and a mortgage loan company.
    "Lender" includes a wholly owned subsidiary of a 
manufacturer, seller, or distributor of goods or services that 
makes loans to businesses or individuals, commonly known as a 
captive finance company.
    "Liability" includes, but is not limited to, accounts 
payable; notes or other indebtedness owed to any source; 
taxes; rent; amounts owed on real estate contracts or real 
estate mortgages; judgments; accrued interest payable; and any 
other liability.
    "State" means the State of Illinois.
    "Underserved farmer" means a farmer or rancher who meets 
the United States Department of Agriculture criteria to be 
designated as a beginning farmer, socially disadvantaged 
farmer, veteran farmer, or limited resource farmer.
    "Underserved community" means a community that has limited 
or no access to resources or that is otherwise disenfranchised 
as determined by the Department. These communities may include 
people who are socioeconomically disadvantaged; people with 
limited English proficiency; geographically isolated or 
educationally disenfranchised people; people of color as well 
as ethnic and national origin minorities; women and children; 
individuals with disabilities and others with access and 
functional needs; and seniors.
    "Value-added agricultural product" means any farm or 
agricultural product or by-product that has its value enhanced 
through processing in Illinois, packaging in Illinois, or any 
other activity in Illinois.
 
    Section 10. Findings. 
    (a) The General Assembly finds that the following 
conditions exist in this State:
        (1) Small fruit, vegetable, and livestock farmers are 
    vital to the health and wealth of Illinois communities, 
    yet Illinois does not currently have infrastructure in 
    place to support local food farmers or to feed Illinois 
    communities.
        (2) An estimated 95% of the food consumed in Illinois 
    is purchased from outside of our borders, resulting in the 
    export of billions of food dollars outside our State 
    rather than the enhancement of our local food economies.
        (3) A shift of just 10% toward local food purchasing 
    by Illinois individuals, families, schools, institutions, 
    and State agencies could generate billions in economic 
    growth for our State.
        (4) For Illinois families, businesses, schools, and 
    institutions to shift their purchasing practices, Illinois 
    must invest in supporting critical local food 
    infrastructure needed to bolster processing, aggregation, 
    and distribution of local food.
    (b) The General Assembly determines and declares that 
there exist conditions in the State that require the 
Department to issue grants on behalf of the State for the 
development of local food processing, aggregation, and 
distribution.
 
    Section 15. Local Food Infrastructure Grant Program. 
Funding appropriated for the Local Food Infrastructure Grant 
Program shall be allocated to the Department. The Department 
may enter into a subcontract agreement with a nonprofit 
organization that is exempt from taxation under Section 
501(c)(3) of the Internal Revenue Code and that represents 
farmers in order to administer the grant program established 
under this Act, so long as the administration of the grant 
program by the grant administrator adheres to the requirements 
of this Act, including the following requirements:
        (1) Eligible grant applicants shall include any one or 
    more of the following entities that store, process, 
    package, aggregate, or distribute value-added agricultural 
    products or plan to do so:
            (A) Illinois farms with less than 50 employees;
            (B) Illinois cooperatives with less than 50 
        employees;
            (C) Illinois processing facilities with less than 
        50 employees;
            (D) Illinois food businesses with less than 50 
        employees;
            (E) Illinois food hubs with less than 50 
        employees;
            (F) Illinois nonprofit organizations; and
            (G) units of local government in Illinois.
        Grant proposals may be submitted to the grant 
    administrator by individuals, groups, partnerships, or 
    collaborations. A recipient of grant funding under this 
    Act whose project is funded in a grant cycle is not 
    eligible to apply for grant funding under this Act for 
    that project in the next funding cycle nor is any other 
    person eligible to apply for grant funding for that 
    project in the next funding cycle. However, any person may 
    apply for grant funding under this Act for such project in 
    any subsequent funding cycles.
        (2) Grant awards shall be available for collaborative 
    and individual projects at the following award amounts:
            (A) for a collaborative project, a grant of $1,000 
        to $250,000 may be awarded; and
            (B) for an individual project, a grant of $1,000 
        to $75,000 may be awarded.
        (3) All funded projects must show comparable 
    investments by the recipient in the development and 
    progression of the project being funded or must show 
    evidence of being a high need project. The recipient's 
    comparable investments may be provided in cash, 
    cash-equivalent investments, bonds, irrevocable letters of 
    credit, time and labor, or any combination of those 
    matching fund sources. Acceptable providers of matching 
    funds include, but are not limited to, commercial, 
    municipal, and private lenders; leasing companies; and 
    grantors of funds. A project may be designated as a high 
    need project if at least one of the following conditions 
    is met:
            (A) the project can demonstrate that it is filling 
        a gap in critical infrastructure for its region or 
        community that is unlikely to be resolved without the 
        grant investment; or
            (B) the project can demonstrate that the grant 
        investment will primarily serve underserved farmers or 
        underserved communities.
        (4) All grant funding provided under this Act must be 
    used for purchasing, leasing to own, renting, building, or 
    installing infrastructure related to the processing, 
    storage, aggregation, or distribution of value-added 
    agricultural products. Allowable expenses include, but are 
    not limited to:
            (A) equipment used in the production of 
        value-added agricultural products;
            (B) milling or pressing equipment;
            (C) creamery or milk product processing and 
        packaging equipment;
            (D) food hub development or expansion;
            (E) cooler walls and refrigeration units;
            (F) grading, packing, labeling, packaging, or 
        sorting equipment;
            (G) refrigerated trucks;
            (H) custom exempt mobile slaughter units and 
        livestock processing equipment;
            (I) agroforestry processing equipment; and
            (J) local fish and shrimp processing.
        Grant funding provided under this Act may not be used 
    for labor, marketing, or promotion or for the costs of 
    production agriculture, such as costs for the purchase of 
    hoop houses, irrigation, or other infrastructure related 
    to starting or increasing agricultural production.
 
    Section 17. Local Food Infrastructure Grant Fund. The 
Local Food Infrastructure Grant Fund is created as a special 
fund in the State treasury. Appropriations and moneys from any 
public or private source may be deposited into the Fund. The 
Fund shall be used for the purposes of this Act. Repayments of 
grants made under this Section shall be deposited into the 
Fund. A maximum of 10% of all funds appropriated through the 
Fund may be used by the Department for the costs of 
administering the grant within the Department or the cost of 
subcontracting a grant administrator.
 
    Section 20. Program administration. 
    (a) The grant administrator shall create an independent 
Local Food Infrastructure Steering Committee to guide the 
implementation and evaluation of the grant program created by 
this Act. The Steering Committee shall be composed of, at a 
minimum, the following members: at least 3 farmers, including 
one specialty crop farmer, one livestock farmer, and one 
farmer of color; one representative from the local food 
processing industry; one representative from a nonprofit 
organization serving farmers of color; one representative from 
a nonprofit organization serving farmers at large; and one 
representative from the Illinois Stewardship Alliance Local 
Food Farmer Caucus so long as the Caucus exists.
    (b) The Steering Committee's responsibilities shall 
include advising the Department and any other grant 
administrator on the following matters:
        (1) application requirements and terms of grant 
    agreements;
        (2) grant criteria and preferences, including 
    additional criteria and preferences to be adopted by the 
    Department by rule;
        (3) the meaning of the term "collaborative project" to 
    be codified in Department rules;
        (4) grant review and selection;
        (5) project reporting requirements for funded 
    projects; and
        (6) evaluation of program success and adjustment of 
    criteria, requirements, preferences, program 
    implementation, and other elements of the grant program as 
    needed to ensure that the grant program meets its intended 
    purpose and complies with this Act.
    (c) An applicant for grant funding under this Act must, at 
a minimum, be an Illinois resident, as defined by Department 
rule, and provide the names, addresses, and occupations of all 
project owners, the project address, relevant credit and 
financial information (including, but not limited to, assets 
and liabilities), and any other information deemed necessary 
by the grant administrator for review of the grant 
application. A grant award is subject to modification or 
alteration under the condition that the grant award is subject 
to any modifications that may be required by changes in State 
law or rules. The Department shall provide written notice to 
the recipient or, if subcontracting with another grant 
administrator, the other grant administrator of any amendment 
to the Act or rules adopted under the Act and the effective 
date of those amendments.
    (d) The grant administrator, in reviewing the 
applications, must consider, but is not limited to 
considering, the following criteria:
        (1) whether the project has a reasonable assurance of 
    increasing the availability and accessibility of Illinois 
    agricultural products among Illinois communities;
        (2) whether there is an adequate and realistic budget 
    projection; and 
        (3) whether the application meets the eligibility 
    requirements and the project costs are eligible under this 
    Act.
    (e) Preference for grants shall be given to the following 
types of proposals:
        (1) proposals that have established favorable 
    community support;
        (2) proposals that increase the availability of 
    Illinois agricultural products to underserved communities 
    in Illinois;
        (3) proposals that positively impact underserved 
    farmers in Illinois;
        (4) proposals from established farmers and food 
    businesses;
        (5) proposals that facilitate long-term economic 
    development in the local food sector;
        (6) proposals that demonstrate comparable investments 
    by the anticipated recipient;
        (7) proposals for high need projects; and
        (8) proposals that are submitted by small and very 
    small farms and food businesses.
 
    Section 25. Report. The grant administrator must annually 
file with the Governor and General Assembly and publish 
publicly each year a written report detailing the impact of 
the Local Food Infrastructure Grant Program for the previous 
calendar year. The report must include:
        (1) a complete list of all applications for grants 
    under this Act that were received during the previous 
    calendar year;
        (2) a complete list of all persons that were awarded a 
    grant under this Act in the previous calendar year and the 
    nature and amount of their awards; and
        (3) a statement of the economic impact of the grants 
    made in the previous calendar year, which may include jobs 
    created, local food sales increased, and communities 
    served.
 
    Section 30. Liability. The Director, the grant 
administrator, the Local Food Infrastructure Steering 
Committee, Department employees, and any persons authorized to 
execute grants are not personally liable on account of the 
grants made under this Act and are not subject to any personal 
liability or accountability by reason of the issuance of the 
grants.
 
    Section 35. Default or termination of grant agreement. 
    (a) If the recipient of a grant violates any of the terms 
of the grant agreement, the grant administrator shall send a 
written notice to the recipient that the recipient is in 
default, and the recipient shall be given the opportunity to 
correct the violations.
    (b) If the violation is not corrected within 30 days after 
receipt of the notification, the grant administrator may take 
any one or more of the following actions:
        (1) The grant administrator may declare due and 
    payable the amount of the grant, or any portion of it, and 
    cease additional grant payments not yet made to the grant 
    recipient.
        (2) The grant administrator may take any other action 
    considered appropriate to protect the interest of the 
    project.
    (c) The grant administrator may determine that a recipient 
has failed to faithfully perform the terms and conditions of 
the scope of work of the project when:
        (1) The grant administrator has notified the recipient 
    in writing of the existence of circumstances such as 
    misapplication of grant funds, failure to match grant 
    funds, evidence of fraud and abuse, repeated failure to 
    meet performance timelines or standards, or failure to 
    resolve negotiated points of the agreement.
        (2) The recipient fails to develop and implement a 
    corrective action plan within 30 calendar days of the 
    grant administrator's notice.
    (d) A grant may be terminated as provided in this 
subsection:
        (1) If there is no appropriation for the grant program 
    for a specific year, all grants for that year will be 
    terminated in full. If there is an insufficient 
    appropriation for the grant program for a specific year, 
    the grant administrator may make proportionate cuts to all 
    recipients.
        (2) If the grant administrator determines that the 
    recipient has failed to comply with the terms and 
    conditions of the grant agreement, the grant administrator 
    may terminate the grant in whole, or in part, at any time 
    before the date of completion.
        (3) If the grant administrator determines that the 
    continuation of the project would not produce beneficial 
    results commensurate with the further expenditure of 
    funds, the grant administrator may terminate the grant in 
    whole, or in part, at any time before the date of 
    completion.
        (4) If the recipient refuses or elects not to complete 
    the grant agreement and terminate the grant, the recipient 
    shall notify the grant administrator within 10 days after 
    the date upon which performance ceases. Upon receipt of 
    the notification, the grant shall be declared terminated, 
    and the grant administrator may declare due and payable 
    the amount of the grant and may cease additional grant 
    payments not yet made to the grantee.
    (e) Any money collected from the default or termination of 
a grant shall be placed into the Fund and expended for the 
purposes of this Act.
 
    Section 40. Construction. This Act is necessary for the 
welfare of this State and must be liberally construed to 
effectuate its purposes. The Department may adopt rules that 
are consistent with and necessary for the implementation and 
administration of this Act.
 
    Section 900. The State Finance Act is amended by adding 
Section 5.1015 as follows:
 
    (30 ILCS 105/5.1015 new)
    Sec. 5.1015. The Local Food Infrastructure Grant Fund.
 
    Section 999. Effective date. This Act takes effect upon 
becoming law.