Public Act 099-0509
 
SB0324 EnrolledLRB099 02938 JLK 22946 b



    AN ACT concerning government.

 
    Be it enacted by the People of the State of Illinois, 
represented in the General Assembly: 



 
    Section 5. The Illinois Finance Authority Act is amended  by 
changing Sections 805-20, 830-30, 830-35, 830-45, and 830-55 
and  by adding Article 835 as follows:
 



    (20 ILCS 3501/805-20)



    Sec. 805-20. Powers and Duties; Industrial Project 
Insurance Program. The
Authority has the power:

    (a) to insure and make advance commitments to insure all or 
any part of the
payments required on the bonds issued or a loan 
made to finance any
environmental facility under the Illinois 
Environmental Facilities Financing
Act
or for any industrial 
project upon such terms and conditions as the Authority
may 
prescribe in accordance with
this Article. The
insurance 
provided by the Authority shall be payable solely from the Fund

created by
Section 805-15 and shall not constitute a debt or 
pledge of the full
faith and credit of the State, the 
Authority, or any political subdivision
thereof;

    (b) to enter into insurance contracts, letters of credit or 
any other
agreements or contracts with financial institutions 
with respect to the Fund
and
any bonds or loans insured 
thereunder. Any such agreement or contract may
contain terms 
and provisions necessary or desirable in connection with the

program, subject to the requirements established by this Act, 
including without
limitation terms and provisions relating to 
loan documentation, review and
approval procedures, 
origination and servicing rights and responsibilities,
default 
conditions, procedures and obligations with respect to 
insurance
contracts made under this Act. The agreements or 
contracts may be executed on
an individual, group or master 
contract basis with financial institutions;

    (c) to charge reasonable fees to defray the cost of 
obtaining letters of
credit
or other similar documents, other 
than insurance contracts under paragraph (b).
Any such fees 
shall be payable by such person, in such amounts and at such

times
as the Authority shall determine, and the amount of the 
fees need not be
uniform
among the various bonds or loans 
insured;

    (d) to fix insurance premiums for the insurance of payments 
under the
provisions of
this Article. Such premiums shall be

computed as determined by the Authority. Any premiums for the 
insurance of loan
payments under the provisions of this Act 
shall be payable by such person, in
such amounts and at such 
times as the Authority shall determine, and the amount
of the 
premiums need not be uniform among the various bonds or loans 
insured;

    (e) to establish application fees and prescribe 
application, notification,
contract and insurance forms, rules 
and regulations it deems necessary or
appropriate;

    (f) to make loans and to issue bonds secured by insurance 
or other
agreements
authorized by paragraphs (a) and (b) of 
this
Section 805-20 and to issue bonds
secured by loans that 
are guaranteed by the federal government or agencies
thereof;

    (g) to issue a single bond issue, or a series of bond 
issues, for a group of
industrial projects, a group of 
corporations, or a group of business entities
or
any 
combination thereof insured by insurance or backed by any other 
agreement
authorized by paragraphs (a) and (b) of this
Section 
or secured by loans that
are guaranteed by the federal 
government or agencies thereof;

    (h) to enter into trust agreements for the management of 
the Fund created
under Section 805-15 of this Act;

    (i) to exercise such other powers as are necessary or 
incidental to the powers granted in this Section and to the 
issuance of State Guarantees under Article 830 of this Act; and

    (j) at the discretion of the Authority, to insure and make 
advance commitments to insure, and issue State Guarantees for, 
all or any part of the payments required on the bonds issued or 
loans made to finance any agricultural facility, project, 
farmer, producer, agribusiness, qualified veteran-owned small 
business, or program under Article 830 or Article 835 of this 
Act upon such terms and conditions as the Authority may 
prescribe in accordance with this Article. The insurance and 
State Guarantees provided by the Authority may be payable from 
the Fund created by Section 805-15 and is in addition to and 
not in replacement of the Illinois Agricultural Loan Guarantee 
Fund and the Illinois Farmer and Agribusiness Loan Guarantee 
Fund created under Article 830 of this Act. 
(Source: P.A. 96-897, eff. 5-24-10; 97-333, eff. 8-12-11.)

 



    (20 ILCS 3501/830-30)



    Sec. 830-30. State Guarantees for existing debt. 

    (a) The Authority is authorized to issue State Guarantees 
for farmers'
existing
debts held by a lender. For the purposes 
of this
Section, a farmer shall be a
resident of Illinois, who 
is a principal operator of a farm or land, at least
50% of 
whose annual gross income is derived from farming and whose 
debt to
asset
ratio shall not be less than 40%, except in those 
cases where the applicant has
previously used the guarantee 
program there shall be no debt to asset ratio or
income 
restriction. For the purposes of this
Section, debt to asset 
ratio shall
mean the current outstanding liabilities of the 
farmer divided by the current
outstanding assets of the farmer. 
The Authority shall establish the maximum
permissible debt to 
asset ratio based on criteria established by the Authority.

Lenders shall apply for the State Guarantees on forms provided 
by the Authority
and certify that the application and any other 
documents submitted are true and
correct. The lender or 
borrower, or both in combination, shall pay an
administrative 
fee as determined by the Authority. The applicant shall be

responsible for paying any fees or charges involved in 
recording mortgages,
releases, financing statements, insurance 
for secondary market issues and any
other similar fees or 
charges as the Authority may require. The application
shall at 
a minimum contain the farmer's name, address, present credit 
and
financial information, including cash flow statements, 
financial statements,
balance sheets, and any other 
information pertinent to the application, and the
collateral to 
be used to secure the State Guarantee. In addition, the lender

must agree to bring the farmer's debt to a current status at 
the time the State
Guarantee is provided and must also agree to 
charge a fixed or adjustable
interest rate which the Authority 
determines to be below the market rate of
interest generally 
available to the borrower. If both the lender and applicant

agree, the interest rate on the State Guarantee Loan can be 
converted to a fixed
interest rate at any time during the term 
of the loan.
Any State Guarantees provided under this
Section 
(i) shall not exceed $500,000
per farmer, (ii) shall be set up 
on a payment schedule not to exceed 30 years,
and shall be no 
longer than 30 years in duration, and (iii) shall be subject to

an annual review and renewal by the lender and the Authority; 
provided that
only
one such State Guarantee shall be 
outstanding per farmer at any one time. No
State Guarantee 
shall be revoked by the Authority without a 90-day notice, in

writing, to all parties. In those cases where the borrower has 
not previously
used the guarantee program, the lender shall not 
call due any loan during the
first 3 years for any reason 
except for lack of performance or insufficient
collateral. The 
lender can review and withdraw or continue with the State

Guarantee on an annual basis after the first 3 years of the 
loan, provided a
90-day notice, in writing, to all parties has 
been given.

    (b) The Authority shall provide or renew a State Guarantee 
to a lender if:


        (i) A fee equal to 25 basis points on the loan is paid 
    to the Authority on
an
annual
basis by the lender.


        (ii) The application provides collateral acceptable to 
    the
Authority that is at least equal to the State's portion 
    of the Guarantee to be
provided.


        (iii) The lender assumes all responsibility and costs 
    for pursuing
legal action on collecting any loan that is 
    delinquent or in default.


        (iv) The
lender is responsible for the first 15% of the 
    outstanding principal of the
note
for which the State 
    Guarantee has been applied.

    (c) There is hereby created outside of the State treasury a 
special fund to
be
known as the Illinois Agricultural Loan 
Guarantee Fund. The State Treasurer
shall be custodian of this 
Fund. Any amounts in the Illinois Agricultural Loan
Guarantee 
Fund not currently needed to meet the obligations of the Fund 
shall
be
invested as provided by law, and all interest earned 
from these investments
shall be deposited into the Fund until 
the Fund reaches the maximum amount
authorized in this Act; 
thereafter, interest earned shall be deposited into the
General 
Revenue Fund. After September 1, 1989, annual investment 
earnings equal
to 1.5% of the Fund shall remain in the Fund to 
be used for the purposes
established in
Section 830-40 of this 
Act. The Authority is authorized to
transfer to the Fund such 
amounts as are necessary to satisfy claims during the
duration 
of the State Guarantee program to secure State Guarantees 
issued under
this
Section, provided that amounts to be paid 
from the Industrial Project Insurance Fund created under 
Article 805 of this Act may be paid by the Authority directly 
to satisfy claims and need not
be deposited first into the 
Illinois Agricultural Loan Guarantee Fund. If for any reason 
the General Assembly fails to make an
appropriation sufficient 
to meet these obligations, this Act shall constitute
an

irrevocable and continuing appropriation of an amount 
necessary to secure
guarantees as defaults occur and the 
irrevocable and continuing authority for,
and direction to, the 
State Treasurer and the Comptroller to make the necessary

transfers to the Illinois Agricultural Loan Guarantee Fund, as 
directed by the
Governor, out of the General Revenue Fund. 
Within 30 days after November 15,
1985, the Authority may 
transfer up to $7,000,000 from available appropriations
into 
the Illinois Agricultural Loan Guarantee Fund for the purposes 
of this
Act.
Thereafter, the Authority may transfer additional 
amounts into the Illinois
Agricultural Loan Guarantee Fund to 
secure guarantees for defaults as defaults
occur. In the event 
of default by the farmer, the lender shall be entitled to,
and 
the Authority shall direct payment on, the State Guarantee 
after 90 days of
delinquency. All payments by the Authority 
shall be made from the Illinois
Agricultural Loan Guarantee 
Fund to satisfy claims against the State Guarantee shall be 
made, in whole or in part, from any of the following funds in 
such order and in such amounts as the Authority shall 
determine: (1) the Industrial Project Insurance Fund created 
under Article 805 of this Act (if the Authority exercises its 
discretion under subsection (j) of Section 805-20); (2) the 
Illinois Agricultural Loan Guarantee Fund; or (3) the Illinois 
Farmer and Agribusiness Loan Guarantee Fund.
The Illinois 
Agricultural Loan Guarantee Fund shall guarantee receipt of 
payment
of the 85% of the principal and interest owed on the 
State Guarantee Loan by the
farmer to the guarantee holder, 
provided that payments by the Authority to satisfy claims 
against the State Guarantee shall be made in accordance with 
the preceding sentence. It shall be the responsibility of the 
lender to
proceed with the collecting and disposing of 
collateral on the State Guarantee under this Section, Section 
830-35, Section 830-45, Section 830-50, Section 830-55, or 
Article 835
within 14 months of the time the State Guarantee is 
declared delinquent;
provided, however, that the lender shall 
not collect or dispose of collateral on
the State Guarantee 
without the express written prior approval of the Authority.
If 
the lender does not dispose of the collateral within 14 months, 
the lender
shall be liable to repay to the State interest on 
the State Guarantee equal to
the same rate which the lender 
charges on the State Guarantee; provided,
however, that the 
Authority may extend the 14-month period for a lender in the

case of bankruptcy or extenuating circumstances. The Fund from 
which a payment is made shall be reimbursed
for any amounts 
paid from that Fund under this
Section, Section 830-35, Section 
830-45, Section 830-50, Section 830-55, or Article 835 upon 
liquidation of the collateral. The
Authority, by resolution of 
the Board, may borrow sums from the Fund and
provide
for 
repayment as soon as may be practical upon receipt of payments 
of principal
and interest by a farmer. Money may be borrowed 
from the Fund by the Authority
for the sole purpose of paying 
certain interest costs for farmers associated
with selling a 
loan subject to a State Guarantee in a secondary market as may

be
deemed reasonable and necessary by the Authority.

    (d) Notwithstanding the provisions of this
Section 830-30 
with respect to the
farmers and lenders who may obtain State 
Guarantees, the Authority may
promulgate rules establishing 
the eligibility of farmers and lenders to
participate in the 
State guarantee program and the terms, standards, and

procedures that will apply, when the Authority finds that 
emergency conditions
in Illinois agriculture have created the 
need for State Guarantees pursuant to
terms, standards, and 
procedures other than those specified in this
Section.

(Source: P.A. 93-205, eff. 1-1-04.)

 



    (20 ILCS 3501/830-35)



    Sec. 830-35. State Guarantees for loans to farmers and 
agribusiness;
eligibility.
    (a) The Authority is authorized to issue State Guarantees 
to lenders for
loans
to eligible farmers and agribusinesses for 
purposes set forth in this
Section.
For purposes of this

Section, an eligible farmer shall be a resident of Illinois
(i) 
who is principal operator of a farm or land, at least 50% of 
whose annual
gross income is derived from farming, (ii) whose 
annual total sales of
agricultural products, commodities, or 
livestock exceeds $20,000, and (iii)
whose net worth does not 
exceed $500,000. An eligible agribusiness shall be
that as 
defined in
Section 801-10 of this Act.
The Authority may 
approve applications by farmers and agribusinesses that

promote diversification of the farm economy of this State 
through the growth
and
development of new crops or livestock 
not customarily grown or produced in this
State or that 
emphasize a vertical integration of grain or livestock produced

or
raised in this State into a finished agricultural product 
for consumption or
use. "New crops or livestock not customarily 
grown or produced in this State"
shall not include corn, 
soybeans, wheat, swine, or beef or dairy cattle.
"Vertical 
integration of grain or livestock produced or raised in this 
State"
shall include any new or existing grain or livestock 
grown or produced in this
State.
Lenders shall apply for the 
State Guarantees on forms provided by the
Authority,
certify 
that the application and any other documents submitted are true 
and
correct, and pay an administrative fee as determined by the 
Authority. The
applicant shall be responsible for paying any 
fees or charges involved in
recording mortgages, releases, 
financing statements, insurance for secondary
market issues 
and any other similar fees or charges as the Authority may

require. The application shall at a minimum contain the 
farmer's or
agribusiness' name, address, present credit and 
financial information,
including cash flow statements, 
financial statements, balance sheets, and any
other

information pertinent to the application, and the collateral to 
be used to
secure the State Guarantee. In addition, the lender 
must agree to charge an
interest rate, which may vary, on the 
loan that the Authority determines to be
below the market rate 
of interest generally available to the borrower. If both
the 
lender and applicant agree, the interest rate on the State 
Guarantee Loan
can be converted to a fixed interest rate at any 
time during the term of the
loan.
Any State Guarantees provided 
under this
Section (i) shall not exceed $500,000
per farmer or 
an amount as determined by the Authority on a case-by-case

basis for an agribusiness, (ii) shall not exceed a term of 15 
years, and (iii)
shall be subject to an annual review and 
renewal by the lender and the
Authority; provided that only one 
such State Guarantee shall be made per farmer
or agribusiness, 
except that additional State Guarantees may be made for

purposes of expansion of projects financed in part by a 
previously issued State
Guarantee. No State Guarantee shall be 
revoked by the Authority without a
90-day notice, in writing, 
to all parties. The lender shall not call due any
loan
for any 
reason except for lack of performance, insufficient 
collateral, or
maturity. A lender may review and withdraw or 
continue with a State Guarantee
on an annual basis after the 
first 5 years following closing of the loan
application if the 
loan contract provides for an interest rate that shall not

vary. A lender shall not withdraw a State Guarantee if the loan 
contract
provides for an interest rate that may vary, except 
for reasons set forth
herein.

    (b) The Authority shall provide or renew a State Guarantee 
to a lender if:


        (i) A fee equal to 25 basis points on the loan is paid 
    to the Authority on
an annual
basis by the lender.


        (ii) The application provides collateral acceptable to 
    the
Authority that is at least equal to the State's portion 
    of the Guarantee to be
provided.


        (iii) The lender assumes all responsibility and costs 
    for pursuing
legal action on collecting any loan that is 
    delinquent or in default.


        (iv) The
lender is responsible for the first 15% of the 
    outstanding principal of the
note
for which the State 
    Guarantee has been applied.

    (c) There is hereby created outside of the State treasury a 
special fund to
be
known as the Illinois Farmer and 
Agribusiness Loan Guarantee Fund. The State
Treasurer shall be 
custodian of this Fund. Any amounts in the Fund not
currently 
needed to meet the obligations of the Fund shall be invested as

provided by law, and all interest earned from these investments 
shall be
deposited into the Fund until the Fund reaches the 
maximum amounts authorized
in
this Act; thereafter, interest 
earned shall be deposited into the General
Revenue Fund. After 
September 1, 1989, annual investment earnings equal to 1.5%
of 
the Fund shall remain in the Fund to be used for the purposes 
established in
Section 830-40 of this Act. The Authority is 
authorized to transfer such
amounts
as are necessary to satisfy 
claims from available appropriations and from fund
balances of 
the Farm Emergency Assistance Fund as of June 30 of each year 
to
the
Illinois Farmer and Agribusiness Loan Guarantee Fund to 
secure State Guarantees
issued under this
Section, and
Sections 
830-30, 830-45, 830-50, and 830-55, and Article 835 of this 
Act.  Amounts to be paid from the Industrial Project Insurance 
Fund created under Article 805 of this Act may be paid by the 
Authority directly to satisfy claims and need not be deposited 
first into the Illinois Farmer and Agribusiness Loan Guarantee 
Fund. If for any reason the
General Assembly fails to make an 
appropriation sufficient to meet these
obligations, this Act 
shall constitute an irrevocable and continuing
appropriation 
of an amount necessary to secure guarantees as defaults occur 
and
the irrevocable and continuing authority for, and direction 
to, the State
Treasurer and the Comptroller to make the 
necessary transfers to the Illinois
Farmer and Agribusiness 
Loan Guarantee Fund, as directed by the Governor, out
of
the 
General Revenue Fund. In the event of default by the borrower 
on State
Guarantee Loans under this
Section,
Section 830-45,

Section 830-50, or Section 830-55, the lender
shall be entitled 
to, and the Authority shall direct payment on, the State

Guarantee after 90 days of delinquency. All payments by the 
Authority shall be
made from the Illinois Farmer and 
Agribusiness Loan Guarantee Fund to satisfy
claims against the 
State Guarantee shall be made, in whole or in part, from any of 
the following funds in such order and in such amounts as the 
Authority shall determine: (1) the Industrial Project 
Insurance Fund created under Article 805 of this Act (if the 
Authority exercises its discretion under subsection (j) of 
Section 805-20); (2) the Illinois Farmer and Agribusiness Loan 
Guarantee Fund; or (3) the Illinois Farmer and Agribusiness 
Loan Guarantee Fund. It shall be the responsibility of the

lender to proceed with the collecting and disposing of 
collateral on the State
Guarantee under this
Section,
Section 
830-45,
Section 830-50, or Section 830-55 within 14 months of

the time the State Guarantee is declared delinquent. If the 
lender does not
dispose of the collateral within 14 months, the 
lender shall be liable to repay
to the State interest on the 
State Guarantee equal to the same rate that the
lender charges 
on the State Guarantee, provided that the Authority shall have

the authority to extend the 14-month period for a lender in the 
case of
bankruptcy or extenuating circumstances. The Fund shall 
be reimbursed for any
amounts paid under this
Section, Section 
830-30,
Section 830-45,
Section 830-50, or Section 830-55, or 
Article 835 upon liquidation
of the collateral.
The Authority, 
by resolution of the Board, may borrow sums from the Fund and

provide for repayment as soon as may be practical upon receipt 
of payments of
principal and interest by a borrower on State 
Guarantee Loans under this
Section, Section 830-30,
Section 
830-45,
Section 830-50, or Section 830-55, or Article 835. 
Money may be borrowed from the Fund by
the Authority for the 
sole purpose of paying certain interest costs for
borrowers 
associated with selling a loan subject to a State Guarantee 
under
this
Section, Section 830-30,
Section 830-45,
Section 
830-50, or Section 830-55, or Article 835 in a secondary market 
as may be deemed
reasonable and necessary by the Authority.

    (d) Notwithstanding the provisions of this
Section 830-35 
with respect to the
farmers, agribusinesses, and lenders who 
may obtain State Guarantees, the
Authority may promulgate rules 
establishing the eligibility of farmers,
agribusinesses, and 
lenders to participate in the State Guarantee program and
the 
terms, standards, and procedures that will apply, when the 
Authority finds
that emergency conditions in Illinois 
agriculture have created the need for
State Guarantees pursuant 
to terms, standards, and procedures other than those
specified 
in this
Section.

(Source: P.A. 96-897, eff. 5-24-10.)

 



    (20 ILCS 3501/830-45)



    Sec. 830-45. Young Farmer Loan Guarantee Program. 

    (a) The Authority is authorized to issue State Guarantees 
to lenders for
loans
to finance or refinance debts of young 
farmers. For the purposes of this
Section, a young farmer is a 
resident of Illinois who is at least 18 years of
age and who is 
a principal operator of a farm or land, who derives at least 
50%
of annual gross income from farming, whose net worth is not 
less than $10,000
and whose debt to asset ratio is not less 
than 40%. For the purposes of this
Section, debt to asset ratio 
means current outstanding liabilities, including
any debt to be 
financed or refinanced under this
Section 830-45, divided by

current outstanding assets. The Authority shall establish the 
maximum
permissible debt to asset ratio based on criteria 
established by the Authority.
Lenders shall apply for the State 
Guarantees on forms provided by the Authority
and certify that 
the application and any other documents submitted are true and

correct. The lender or borrower, or both in combination, shall 
pay an
administrative fee as determined by the Authority. The 
applicant shall be
responsible for paying any fee or charge 
involved in recording mortgages,
releases, financing 
statements, insurance for secondary market issues, and any

other similar fee or charge that the Authority may require. The 
application
shall at a minimum contain the young farmer's name, 
address, present credit and
financial information, including 
cash flow statements, financial statements,
balance sheets, 
and any other information pertinent to the application, and the

collateral to be used to secure the State Guarantee. In 
addition, the borrower
must certify to the Authority that, at 
the time the State Guarantee is
provided,
the borrower will not 
be delinquent in the repayment of any debt. The lender
must 
agree to charge a fixed or adjustable interest rate that the 
Authority
determines to be below the market rate of interest 
generally available to the
borrower. If both the lender and 
applicant agree, the interest rate on the
State guaranteed loan 
can be converted to a fixed interest rate at any time
during 
the term of the loan.
State Guarantees provided under this

Section (i) shall not exceed $500,000 per
young farmer, (ii) 
shall be set up on a payment schedule not to exceed 30
years,

but shall be no longer than 15 years in duration, and (iii) 
shall be subject to
an annual review and renewal by the lender 
and the Authority. A young farmer
may
use this program more 
than once provided the aggregate principal amount of
State

Guarantees under this
Section to that young farmer does not 
exceed $500,000. No
State Guarantee shall be revoked by the 
Authority without a 90-day notice, in
writing, to all parties.

    (b) The Authority shall provide or renew a State Guarantee 
to a lender if:


        (i) The lender pays a fee equal to 25 basis points on 
    the loan to the
Authority on
an annual basis.


        (ii) The application provides collateral acceptable to 
    the
Authority that is at least equal to the State 
    Guarantee.


        (iii) The lender
assumes all responsibility and costs 
    for pursuing legal action on collecting
any
loan that is 
    delinquent or in default.


        (iv) The lender is at risk for the
first 15% of the 
    outstanding principal of the note for which the State

    Guarantee
is provided.

    (c) The Illinois Agricultural Loan Guarantee Fund, and the 
Illinois Farmer and Agribusiness Loan Guarantee Fund, and the 
Industrial Project Insurance Fund may be used to
secure State 
Guarantees issued under this
Section as provided in
Section 
830-30, and Section 830-35, and subsection (j) of Section 
805-20, respectively. All payments by the Authority to satisfy 
claims against the State Guarantee shall be made, in whole or 
in part, from any of the following funds in such order and in 
such amounts as the Authority shall determine: (1) the 
Industrial Project Insurance Fund (if the Authority exercises 
its discretion under subsection (j) of Section 805-20); (2) the 
Illinois Agricultural Loan Guarantee Fund; or (3) the Illinois 
Farmer and Agribusiness Loan Guarantee Fund. 

    (d) Notwithstanding the provisions of this
Section 830-45 
with respect to the
young farmers and lenders who may obtain 
State Guarantees, the Authority may
promulgate rules 
establishing the eligibility of young farmers and lenders to

participate in the State Guarantee program and the terms, 
standards, and
procedures that will apply, when the Authority 
finds that emergency conditions
in Illinois agriculture have 
created the need for State Guarantees pursuant to
terms, 
standards, and procedures other than those specified in this

Section.

(Source: P.A. 96-897, eff. 5-24-10.)

 
    (20 ILCS 3501/830-55)
    Sec. 830-55. Working Capital Loan Guarantee Program.
    (a) The Authority is authorized to issue State Guarantees 
to lenders for loans to finance needed input costs related to 
and in connection with planting and raising agricultural crops 
and  commodities in Illinois.  Eligible input costs include, but 
are not limited to, fertilizer, chemicals, feed, seed, fuel, 
parts, and repairs.  At the discretion of the Authority, the 
farmer, producer, or agribusiness must be able to provide the 
originating lender with a first lien on the proposed crop or 
commodity to be raised and an assignment of Federal Crop 
Insurance sufficient to secure the Working Capital Loan.  
Additional collateral may be required as deemed necessary by 
the lender and the Authority. 
    For the purposes of this Section, an eligible farmer, 
producer, or agribusiness is a resident of Illinois who is at 
least 18 years of age and who is a principal operator of a farm 
or land, who derives at least 50% of annual gross income from 
farming, and whose debt to asset ratio is not less than 40%. 
For the purposes of this Section, debt to asset ratio means 
current outstanding liabilities, including any debt to be 
financed or refinanced under this Section 830-55, divided by 
current outstanding assets. The Authority shall establish the 
maximum permissible debt to asset ratio based on criteria 
established by the Authority. Lenders shall apply for the State 
Guarantees on forms provided by the Authority and certify that 
the application and any other documents submitted are true and 
correct. The lender or borrower, or both in combination, shall 
pay an administrative fee as determined by the Authority. The 
applicant shall be responsible for paying any fee or charge 
involved in recording mortgages, releases, financing 
statements, insurance for secondary market issues, and any 
other similar fee or charge that the Authority may require. The 
application shall at a minimum contain the borrower's name, 
address, present credit and financial information, including 
cash flow statements, financial statements, balance sheets, 
and any other information pertinent to the application, and the 
collateral to be used to secure the State Guarantee. In 
addition, the borrower must certify to the Authority that, at 
the time the State Guarantee is provided, the borrower will not 
be delinquent in the repayment of any debt. The lender must 
agree to charge a fixed or adjustable interest rate that the 
Authority determines to be below the market rate of interest 
generally available to the borrower. If both the lender and 
applicant agree, the interest rate on the State guaranteed loan 
can be converted to a fixed interest rate at any time during 
the term of the loan. State Guarantees provided under this 
Section (i) shall not exceed $250,000 per borrower, (ii) shall 
be repaid annually, and (iii) shall be subject to an annual 
review and renewal by the lender and the Authority.  The State 
Guarantee may be renewed annually, for a period not to exceed 3 
total years per State Guarantee, if the borrower meets 
financial criteria and other conditions, as established by the 
Authority.  A farmer or agribusiness may use this program more 
than once provided the aggregate principal amount of State 
Guarantees under this Section to that farmer or agribusiness 
does not exceed $250,000 annually. No State Guarantee shall be 
revoked by the Authority without a 90-day notice, in writing, 
to all parties. 
    (b) The Authority shall provide a State Guarantee to a 
lender if:
        (i) The borrower pays to the Authority a fee equal to 
    100 basis points on the loan.
        (ii) The application provides collateral acceptable to 
    the Authority that is at least equal to the State 
    Guarantee.
        (iii) The lender assumes all responsibility and costs 
    for pursuing legal action on collecting any loan that is 
    delinquent or in default.
        (iv) The lender is at risk for the first 15% of the 
    outstanding principal of the note for which the State 
    Guarantee is provided.
    (c) The Illinois Agricultural Loan Guarantee Fund, and the 
Illinois Farmer and Agribusiness Loan Guarantee Fund, and the 
Industrial Project Insurance Fund may be used to secure State 
Guarantees issued under this Section as provided in Section 
830-30, and Section 830-35, and subsection (j) of Section 
805-20, respectively. If the Authority exercises its 
discretion under subsection (j) of Section 805-20 to secure a 
State Guarantee with the Industrial Project Insurance Fund and 
also exercises its discretion under this subsection to secure 
the same State Guarantee with the Illinois Agricultural Loan 
Guarantee Fund, the Illinois Farmer and Agribusiness Loan 
Guarantee Fund, or both, all payments by the Authority to 
satisfy claims against the State Guarantee shall be made from 
the Industrial Project Insurance Fund, the Illinois 
Agricultural Loan Guarantee Fund, or the Illinois Farmer and 
Agribusiness Loan Guarantee Fund, as applicable, in such order 
and in such amounts as the Authority shall determine.
    (d) Notwithstanding the provisions of this Section 830-55 
with respect to the borrowers and lenders who may obtain State 
Guarantees, the Authority may promulgate rules establishing 
the eligibility of borrowers and lenders to participate in the 
State Guarantee program and the terms, standards, and 
procedures that will apply, when the Authority finds that 
emergency conditions in Illinois agriculture have created the 
need for State Guarantees pursuant to terms, standards, and 
procedures other than those specified in this Section. 

(Source: P.A. 96-897, eff. 5-24-10.)
 
    (20 ILCS 3501/Art. 835 heading new)
ARTICLE 835.  VETERANS ASSISTANCE

 
    (20 ILCS 3501/835-5 new)
    Sec. 835-5. Legislative findings.  The General Assembly 
hereby finds and declares the following: (i) that there is an 
inadequate supply of funds available in this State at rates 
sufficiently low to enable veterans to own and operate small 
businesses
successfully in this State; (ii) such an inadequate 
supply of funds makes the
transition of veterans from service 
in the armed forces of the United States to civilian life more 
difficult and results in increased unemployment of veterans and 
its attendant problems; (iii) that there have been recurrent 
shortages of funds available to small businesses owned and 
operated by veterans in this State from private market sources 
at reasonable interest rates; and (iv) that the ordinary 
operations of
private enterprise have not in the past corrected 
these conditions.
 
    (20 ILCS 3501/835-10 new)
    Sec. 835-10. Definitions. As used or referred to in this 
Article 835, the following
words and terms shall have the 
following meanings, except where the context clearly requires 
otherwise:
    "Fund" means one or more of the Industrial Project 
Insurance Fund, the
Illinois Agricultural Loan Guarantee Fund, 
or the Illinois Farmer and Agribusiness Loan Guarantee Fund, as 
applicable. 
    "Illinois Agricultural Loan Guarantee Fund" means the 
Illinois Agricultural Loan Guarantee Fund created under 
Section 830-30(c) of this Act.
    "Illinois Farmer and Agribusiness Loan Guarantee Fund" 
means the Illinois Farmer and Agribusiness Loan Guarantee Fund 
created under Section 830-35(c) of this Act.
    "Industrial Project Insurance Fund" means the Industrial 
Project Insurance
Fund created under Section 805-15 of this 
Act.
    "Qualified veteran-owned small business" has the meaning 
provided in subsection (e) of Section 45-57 of the Illinois 
Procurement Code.
 
    (20 ILCS 3501/835-15 new)
    Sec. 835-15. Powers and duties. The Authority may enter 
into a State Guarantee with a lender, or a person holding a 
note, of a loan or loans to a qualified veteran-owned small 
business and may make payment, in whole or in part, on a State 
Guarantee from any of the following funds in such order and in 
such amounts as the Authority shall determine: (1) the 
Industrial
Project Insurance Fund (if the Authority exercises 
its discretion under subsection (j) of Section 805-20); (2) the 
Illinois Agricultural Loan Guarantee Fund; or (3) the Illinois 
Farmer and Agribusiness Loan Guarantee Fund.
 
    (20 ILCS 3501/835-20 new)
    Sec. 835-20. State Guarantees for loans to qualified 
veteran-owned small businesses.
    (a) The Authority is authorized to issue State Guarantees 
to lenders for loans to qualified
veteran-owned small 
businesses for the general corporate purposes of those 
qualified veteran-owned small businesses. Lenders shall apply 
for the State Guarantees on forms provided by the Authority, 
certify that the application and any other documents submitted 
are true and correct, and pay an administrative fee as 
determined by the Authority. The applicant shall be responsible 
for paying any fees or charges involved in recording mortgages, 
releases, and financing statements, and any other similar fees 
or charges as the Authority may require. The application shall, 
at a minimum, contain the name, address, present credit and 
financial information, including
cash flow statements, 
financial statements, and balance sheets, of the qualified 
veteran-owned small business, any other information pertinent 
to the application, and the collateral to be used to secure the 
State Guarantee.
    In addition, the lender must agree to charge an interest 
rate, which may vary, on the loan that the Authority determines 
to be below the market rate of interest generally available to 
the borrower. If both the lender and applicant agree, the 
interest rate on the loan subject to a State Guarantee can be 
converted to a fixed interest rate at any time during the term 
of the loan. Any State Guarantees provided under this Section 
shall (i) not exceed $500,000 per qualified veteran-owned small 
business, (ii) not exceed a term of 15 years, and (iii) be 
subject to an
annual review and renewal by the lender and the 
Authority; provided that only one such State Guarantee shall be 
made per qualified veteran-owned small business, except that 
additional State Guarantees may be made for purposes of 
expansion of projects financed in part by a previously issued 
State Guarantee. No State Guarantee shall be revoked by the 
Authority without a 90-day notice, in writing, to all parties. 
The lender shall not call due any loan for any reason except 
for lack of performance, insufficient collateral, or maturity. 
A lender may review and withdraw or continue with a State 
Guarantee on an annual basis after the first 5 years following 
closing of the loan application if the loan contract provides 
for an interest rate that does not vary. A lender shall not 
withdraw a State Guarantee if the loan contract provides for an 
interest rate that may vary, except for reasons set forth in 
this Section.
    (b) The Authority shall provide or renew a State Guarantee 
to a lender if:
        (1) a fee equal to 25 basis points on the loan is paid 
    to the Authority on an annual basis by the lender;
        (2) the application provides collateral acceptable to 
    the Authority that is at least equal to
the State's portion 
    of the Guarantee to be provided;
        (3) the lender assumes all responsibility and costs for 
    pursuing legal action on
collecting any loan that is 
    delinquent or in default; and
        (4) the lender is responsible for the first 15% of the 
    outstanding principal of the note for which the State 
    Guarantee has been applied.
    (c) If, for any reason, the General Assembly fails to make 
an appropriation sufficient to
meet the obligations under a 
State Guarantee, this Act shall constitute an irrevocable and 
continuing appropriation of an amount necessary to secure 
guarantees as defaults occur and the irrevocable and continuing 
authority for, and direction to, the State Treasurer and the 
Comptroller to make the necessary transfers to the Industrial 
Project Insurance Fund, the Illinois Agricultural Loan 
Guarantee Fund, or the Illinois Farmer and Agribusiness Loan 
Guarantee Fund, or any combination of those funds, as directed 
by the Governor, out of the General Revenue Fund. In the event 
of a default by the borrower on a  loan subject to a State 
Guarantee under this Section, Section 830-30, Section 830-35, 
Section 830-45, Section 830-50, or Section 830–55, the lender 
shall be entitled to, and the Authority shall direct payment 
on, the State Guarantee after 90 days of delinquency. Payments 
by the Authority to satisfy claims against the State Guarantee 
shall be made, in whole or in part,  from any of the following 
funds in such order and in such amounts as the Authority shall 
determine: (1) the Industrial Project Insurance Fund created 
under Article 805 of this Act (if the Authority exercises its 
discretion under subsection (j) of Section 805-20); (2) the 
Illinois Farmer and Agribusiness Loan Guarantee Fund; or (3) 
the
Illinois Agricultural Loan Guarantee Fund. It shall be the 
responsibility of the lender to proceed with collecting and 
disposing of collateral on the State Guarantee under this 
Section within 14 months after the State Guarantee is declared 
delinquent. If the lender does not dispose of the collateral 
within that 14-month period, the lender shall be liable to 
repay to the State interest on the State Guarantee at a rate 
equal to the same rate that the lender charges on the State 
Guarantee, provided that the
Authority shall have the authority 
to extend the 14-month period for a lender in the case of 
bankruptcy or extenuating circumstances. The applicable fund 
or funds shall be reimbursed for any amounts paid under this 
Section, Section 830-30, Section 830-35, Section 830-45, 
Section 830-50, or Section 830-55 upon liquidation of the 
collateral. The Authority, by resolution of the Board, may 
borrow sums from a fund or funds and provide for repayment as 
soon as may be
practical upon receipt of payments of principal 
and interest by a borrower on loans subject to a State 
Guarantee under this Section, Section 830-30, Section 830-35, 
Section 830-45, Section 830-50, or Section 830-55. Money may be 
borrowed from the Fund by the Authority for the sole
purpose of 
paying certain interest costs for borrowers associated with 
selling a loan subject to a State Guarantee under this Section, 
Section 830–30, Section 830–35, Section 830-45, Section

830-50, or Section 830-55 in a secondary market as may be 
deemed reasonable and necessary by the Authority.
    (d) Notwithstanding the provisions of this Section with 
respect to the qualified veteran-owned small businesses and 
lenders who may obtain State Guarantees, the Authority
may 
adopt rules establishing the eligibility of qualified 
veteran-owned small businesses and lenders to participate in 
the State Guarantee program and the terms, standards, and 
procedures that will apply, if the Authority finds that 
emergency conditions in Illinois have
created the need for 
State Guarantees pursuant to terms, standards, and procedures 
other than those specified in this Section. 
 
    (20 ILCS 3501/835-25 new)
    Sec. 835-25. Authority administrative expenses.  For 
fiscal years 2017 through 2019, the Authority is authorized to 
reimburse itself for the ordinary and necessary expenses of 
administering the State Guarantee
program under this Article 
from amounts from time to time available in the Industrial 
Project Insurance Fund in amounts not to exceed: (1) $275,000 
in fiscal year 2017; and (2) $200,000 per fiscal year in fiscal 
years 2018 and 2019. Ordinary and necessary expenses of 
administering those State Guarantee programs include, without 
limitation, costs of general administration, staff, accounting 
and auditing services, legal services, judgments, loan 
servicing, realization upon collateral, communications with 
borrowers and lenders, and similar expenses, all to the extent 
reasonably allocable to such State Guarantee programs.
    This Section is repealed on August 1, 2019.
 

    Section 99. Effective date. This Act takes effect upon 
becoming law.