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1 | AN ACT concerning State government.
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2 | Be it enacted by the People of the State of Illinois,
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3 | represented in the General Assembly:
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4 | Section 1. Short title. This Act may be cited as the | ||||||
5 | Illinois Opportunity
Fund
Act.
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6 | Section 5. Findings and purposes.
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7 | (a) The State of Illinois finds that the traditional means | ||||||
8 | by which venture
capital
and private equity investors direct | ||||||
9 | capital to Illinois markets does not
adequately serve the
| ||||||
10 | State's needs. The lack of sufficient capital impairs the | ||||||
11 | ability of the State to
create jobs, new
markets for goods and | ||||||
12 | services, and sustainable economic growth throughout
Illinois. | ||||||
13 | The State of Illinois finds that venture capital and private | ||||||
14 | equity investments traditionally have been an efficient means | ||||||
15 | to create jobs, expand new markets for products and services, | ||||||
16 | and generally encourage economic growth.
The State of Illinois | ||||||
17 | desires to strengthen the overall economy of the State by
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18 | increasing
the availability and delivery of venture capital and | ||||||
19 | private equity investments for emerging, expanding, and | ||||||
20 | distressed
enterprises in
Illinois, and to do so in a way that | ||||||
21 | provides for financial returns to private
investors.
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22 | (b) Furthermore, the State of Illinois finds that certain | ||||||
23 | geographic areas
and
populations within the State have been | ||||||
24 | subject to economic disparities and have
lacked
access to the | ||||||
25 | private capital needed to create jobs and economic | ||||||
26 | opportunities.
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27 | (c) Venture capital and private equity investment should be | ||||||
28 | directed to geographic areas and populations
within
the State | ||||||
29 | that have been subject to economic disparities, have lacked | ||||||
30 | access
to the
private capital needed to create jobs and | ||||||
31 | economic opportunities, and to
sectors
considered to be | ||||||
32 | strategic industries for the State of Illinois.
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1 | (d) This Act has the mission of mobilizing private capital | ||||||
2 | investment in a broad
variety of
venture capital and private | ||||||
3 | equity investment funds in diversified industries and | ||||||
4 | geographic regions of the
State of
Illinois. To achieve this | ||||||
5 | mission, the General Assembly believes that it is
necessary to
| ||||||
6 | retain the private sector culture of focusing on rate of return | ||||||
7 | in the
investing process.
Therefore, this Act is intended to | ||||||
8 | facilitate the establishment of the Illinois
Opportunity
Fund, | ||||||
9 | seek private investment, and create interest in these | ||||||
10 | investments by
offering State
credit enhancements that limit | ||||||
11 | risk to private investors. This Act also has the
mission of
| ||||||
12 | facilitating and
enhancing the flow of venture capital and | ||||||
13 | private equity into the State of Illinois and improving
the
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14 | infrastructure through which capital is delivered throughout | ||||||
15 | the State including to those geographic areas and populations | ||||||
16 | within the State that have been subject to economic | ||||||
17 | disparities, so as to create jobs in Illinois, expand new | ||||||
18 | markets for Illinois products and Illinois services, and to | ||||||
19 | generally grow the Illinois economy. It is the goal and intent | ||||||
20 | of this
legislation to accomplish
these missions in such a | ||||||
21 | manner as to minimize any appropriations by the State
of | ||||||
22 | Illinois
to effectuate these purposes.
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23 | Section 10. Definitions. In this Act, unless the context | ||||||
24 | requires otherwise:
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25 | "DCEO" means Department of Commerce and Economic | ||||||
26 | Opportunity, or its
successor agency.
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27 | "Corporation" means the Illinois Capital Investment | ||||||
28 | Corporation created by this Act. | ||||||
29 | "Certificate" means an assignable contract between DCEO | ||||||
30 | and an investor in
the
Illinois Opportunity Fund under which | ||||||
31 | the terms of the tax credits being issued
for the
benefit of | ||||||
32 | the investor, or any assignee of the investor, as established | ||||||
33 | by
DCEO, are
set forth.
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34 | "Person" means an individual, a corporation, a | ||||||
35 | partnership, or any other
lawfully
organized entity, whether |
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1 | domiciled in Illinois or outside of Illinois.
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2 | "Illinois Capital Investment Corporation" means the | ||||||
3 | private not-for-profit
corporation established pursuant to | ||||||
4 | this Act.
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5 | "Illinois Opportunity Fund" means the private for-profit | ||||||
6 | fund established by
the
Illinois Capital Investment | ||||||
7 | Corporation pursuant to this Act.
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8 | "Tax credits" means credits against taxes imposed pursuant | ||||||
9 | to Section 201 of
the
Illinois Income Tax Act for any taxable | ||||||
10 | year ending after December 31, 2009,
and
having such terms as | ||||||
11 | are established by DCEO in accordance with Section 25 of
this | ||||||
12 | Act,
including any contingencies on redemption.
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13 | "SBIC" means small business investment company within the | ||||||
14 | meaning of the
federal Small Business Investment Act of 1958.
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15 | "CDFI" and "CDVC". CDFI means a "community development | ||||||
16 | financial
institution" as defined in the Illinois Investment | ||||||
17 | and Development Authority
Act, and
CDVC means community | ||||||
18 | development venture capital, a type of CDFI specific to
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19 | investing equity interests in Illinois firms with the dual goal | ||||||
20 | of financial
returns and
economic and social benefit.
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21 | "Venture capital and private equity investment" includes | ||||||
22 | private institutional, angel, incubator, mezzanine, | ||||||
23 | seed/start-up stage, early stage, expansions stage, later | ||||||
24 | stage, community development venture capital investments and | ||||||
25 | management buyouts, recapitalization of existing companies, | ||||||
26 | and other structured growth private equity transactions. | ||||||
27 | "Venture Capital and Private Equity Professional" means an | ||||||
28 | individual with substantial professional experience, as a | ||||||
29 | principal and not as an intermediary, managing venture capital | ||||||
30 | and private equity funds, who has demonstrated a track record | ||||||
31 | of successful performance that includes realized or exited | ||||||
32 | investments. For purposes of this definition "principal" means | ||||||
33 | an individual with an ownership interest in the venture capital | ||||||
34 | and private equity fund which that individual manages or | ||||||
35 | operates. |
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1 | Section 15. Illinois Capital Investment Corporation.
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2 | (a) DCEO shall create the Illinois Capital Investment | ||||||
3 | Corporation as a
private not-for-profit corporation under the | ||||||
4 | General Not For Profit Corporation Act of 1986
and not
as a | ||||||
5 | public corporation or instrumentality of the State. The | ||||||
6 | corporation shall
not enjoy
any of the privileges nor be | ||||||
7 | required to comply with any of the requirements of
a State
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8 | agency except as provided in this Act. Except as provided in | ||||||
9 | this Act, nothing in this Act exempts the
Corporation from the | ||||||
10 | same requirements under State law that apply to
other
| ||||||
11 | Corporations organized under the General Not For Profit | ||||||
12 | Corporation Act of
1986. The
Director or Acting Director of | ||||||
13 | DCEO or his or her designee shall be the
incorporator of
the | ||||||
14 | Corporation.
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15 | (b) The Corporation shall establish investment objectives | ||||||
16 | and criteria for venture capital and private equity investment | ||||||
17 | undertaken through the Illinois Opportunity Fund. In | ||||||
18 | establishing these investment objectives and criteria, the | ||||||
19 | Corporation shall consider whether the venture capital and | ||||||
20 | private equity investment is reasonably anticipated (i) to be | ||||||
21 | consistent with a private sector focus on rate of return in the | ||||||
22 | investment process; (ii) to provide financial returns | ||||||
23 | sufficient to meet any obligations to private investors | ||||||
24 | undertaken by the Corporation in accordance with this Act; | ||||||
25 | (iii) to attract investment from private markets in investments | ||||||
26 | within the State of Illinois; and (iv) to result in the | ||||||
27 | strengthening of the State's economy. In establishing these | ||||||
28 | investment objectives and criteria, the Corporation shall | ||||||
29 | consult with leaders in the private sector venture capital and | ||||||
30 | private equity community, business, science, and government to | ||||||
31 | identify strategic industries and sectors that offer the | ||||||
32 | potential to create high quality and sustainable employment | ||||||
33 | opportunities for Illinois residents and create domestic and | ||||||
34 | global markets for the products and services of the investee | ||||||
35 | companies. In addition, in establishing these objectives and | ||||||
36 | criteria, the Corporation shall consider whether venture |
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1 | capital and private equity investment will occur through the | ||||||
2 | Illinois Opportunity Fund in diverse geographies and among | ||||||
3 | populations that have been subject to economic disparities and | ||||||
4 | have lacked access to private capital within Illinois. | ||||||
5 | (c) DCEO shall assist the corporation in performing its | ||||||
6 | duties, and undertake such other responsibilities as are set | ||||||
7 | forth in this Act or as may be necessary or appropriate to give | ||||||
8 | effect to the intent and purposes of this Act. | ||||||
9 | (d) The Corporation shall cooperate and coordinate with | ||||||
10 | DCEO to fulfill the economic development policy of the State as | ||||||
11 | established by the Governor and the General Assembly and | ||||||
12 | implemented by DCEO. | ||||||
13 | (e) The Corporation shall have responsibility for | ||||||
14 | organizing and overseeing the management of the Illinois | ||||||
15 | Opportunity Fund and identifying and engaging a private fund | ||||||
16 | manager or managers for the Illinois Opportunity Fund. The | ||||||
17 | board of directors of the Corporation shall make investment | ||||||
18 | decisions after considering the recommendations of the fund | ||||||
19 | manager or managers. The Corporation shall receive investment | ||||||
20 | returns from the Illinois Opportunity Fund and shall reinvest | ||||||
21 | those funds in venture capital and private equity investments | ||||||
22 | subject to the provisions of this Act. | ||||||
23 | (f) The Corporation shall exercise no
governmental
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24 | functions. Without limiting the authority of DCEO to
issue
tax | ||||||
25 | credits pursuant to this Act under certificates that are | ||||||
26 | binding on DCEO
and the
Illinois Department of Revenue, the | ||||||
27 | obligations of the Corporation are not obligations of the State | ||||||
28 | or any political subdivision of
the State
within the meaning of | ||||||
29 | any Constitutional or statutory debt limitations, but are
| ||||||
30 | obligations
of the Corporation payable solely and only from the | ||||||
31 | corporation's funds. The Corporation shall itself have no | ||||||
32 | authority to pledge the
credit or
taxing power of the State or | ||||||
33 | make its
debts
payable out of any moneys except those of the | ||||||
34 | Corporation.
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35 | (g) The Corporation shall consist of a board of directors | ||||||
36 | of 7 members, who shall be appointed by the Governor with the |
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1 | advice and consent of the Senate. Upon appointment of the board | ||||||
2 | of directors and every 2 years thereafter, the chairperson of | ||||||
3 | the Corporation shall be selected by the Governor to serve as | ||||||
4 | chairperson for 2 years. The Director or Acting Director of | ||||||
5 | DCEO or his or her designee shall be one of the 7 members of the | ||||||
6 | board of directors of the Corporation. A quorum of the board of | ||||||
7 | directors must exist in order for the board to transact | ||||||
8 | business. A quorum of the board of directors shall consist of a | ||||||
9 | majority of directors then in office but in no event less than | ||||||
10 | 3 directors. The appointment of the board of directors of the | ||||||
11 | Corporation shall reflect the geographic and social diversity | ||||||
12 | of the State. At least 3 members of the board of directors | ||||||
13 | shall be Venture Capital and Private Equity Professionals. In | ||||||
14 | making appointments to the Corporation's board of directors, it | ||||||
15 | shall be considered whether (i) each candidate has meaningful | ||||||
16 | experience reviewing,
preparing,
analyzing, or interpreting | ||||||
17 | financial statements or has sophistication in
financial | ||||||
18 | matters
generally, (ii) has meaningful experience in the | ||||||
19 | supervision or management of
venture capital
or private equity | ||||||
20 | investments, (iii) has meaningful experience operating
or
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21 | managing investments in businesses engaged in the industries or | ||||||
22 | sectors
targeted as candidates for investment by the | ||||||
23 | Corporation, or (iv) has
meaningful
experience managing or | ||||||
24 | selecting investments for institutional, seed, angel,
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25 | mezzanine, or
community
development venture capital and | ||||||
26 | private equity investment funds or SBIC's. At the time of | ||||||
27 | appointment, the Governor shall designate 3 directors to serve | ||||||
28 | until the third Monday of July 2006, one of whom shall be a | ||||||
29 | Venture Capital and Private Equity Professional, and 3 | ||||||
30 | directors to serve until the third Monday in July 2007, 2 of | ||||||
31 | whom shall be Venture Capital and Private Equity Professionals. | ||||||
32 | Thereafter, appointments shall be made for 3-year terms. A | ||||||
33 | director shall serve until his or her successor shall be | ||||||
34 | appointed and have qualified for office. The Governor may | ||||||
35 | remove any director of the Corporation for cause.
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36 | (h) A conflict of interest shall be deemed to exist if the |
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1 | Corporation considers entering into a contract with or directly | ||||||
2 | or indirectly sells goods or services to a director, officer, | ||||||
3 | employee of the Board, or the fund manager of the Illinois | ||||||
4 | Opportunity Fund, or any for-profit firm or corporation in | ||||||
5 | which that director, officer, employee, the fund manager of the | ||||||
6 | Illinois Opportunity Fund or any member of his or her immediate | ||||||
7 | family is an officer, partner, or principal stockholder. Upon a | ||||||
8 | showing that a conflict of interest exists, the director, | ||||||
9 | officer, employee, or fund manager of the Illinois Opportunity | ||||||
10 | Fund shall abstain from any discussion or decision making with | ||||||
11 | respect to that contract or agreement, from voting on any | ||||||
12 | matter pertaining to that contract or agreement, and from | ||||||
13 | communicating with other Board members, officers, agents, or | ||||||
14 | employees concerning that contract or agreement. In no event | ||||||
15 | shall the board of directors make any investment in a fund in | ||||||
16 | which a member of the board of directors is a general partner | ||||||
17 | or a limited partner. The Corporation, its board of directors, | ||||||
18 | its officers, its employees, and the fund manager of the | ||||||
19 | Illinois Opportunity Fund are subject to the prohibitions | ||||||
20 | contained in Section 5-55 of the State Officials and Employees | ||||||
21 | Ethics Act. | ||||||
22 | (i) The board of directors of the Corporation shall | ||||||
23 | establish a committee for the selection and evaluation of | ||||||
24 | applicants for the position or positions of fund manager or | ||||||
25 | managers for the Illinois Opportunity Fund. The board of | ||||||
26 | directors of the Corporation shall also establish procedures | ||||||
27 | for the selection and evaluation of applicants for the position | ||||||
28 | or positions of fund manager for the Illinois Opportunity Fund. | ||||||
29 | The committee shall include not more than 3 members of the | ||||||
30 | board of directors of the Corporation, one of which shall be | ||||||
31 | the Director of DCEO or his or her designee. The chairman shall | ||||||
32 | appoint the remaining 2 members of the committee from the | ||||||
33 | members of the board of directors of the Corporation and at | ||||||
34 | least one of whom shall be a Venture Capital and Private Equity | ||||||
35 | Professional. The committee shall receive and review | ||||||
36 | applications for the position of fund manager of the Illinois |
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1 | Opportunity Fund. Any applicant selected to be a fund manager | ||||||
2 | of the Illinois Opportunity Fund shall demonstrate substantial | ||||||
3 | experience in the design, implementation, and management of | ||||||
4 | institutional, seed, angel, mezzanine, or community | ||||||
5 | development venture capital investment and private equity | ||||||
6 | programs or of SBIC's and in capital formation. In reviewing | ||||||
7 | applications, the committee shall consider each applicant's | ||||||
8 | (i) senior level decision making experience in institutional, | ||||||
9 | seed, angel, mezzanine, or community development venture | ||||||
10 | capital and private equity investments or SBIC's investing, | ||||||
11 | including whether the applicant has at least 5 years of such | ||||||
12 | experience, (ii) quality of management, (iii) investment | ||||||
13 | philosophy, (iv) plan for fundraising, (v) ties to Illinois | ||||||
14 | including whether it has a meaningful physical presence in | ||||||
15 | Illinois and knowledge and experience in working with the | ||||||
16 | Illinois venture capital and private equity investment | ||||||
17 | community, and (vi) prior investment fund results, including a | ||||||
18 | track record with a substantial number of realized or exited | ||||||
19 | investments, a time frame over which the track record was | ||||||
20 | achieved, the number of investments the track record is based | ||||||
21 | upon and the economic conditions existing during the time frame | ||||||
22 | of the track record, and shall include a preference that each | ||||||
23 | applicant's experience be financial (as with a formal | ||||||
24 | investment fund) rather than strategic (such as mergers and | ||||||
25 | acquisitions). Each applicant shall submit an investment plan | ||||||
26 | for review by the Corporation, which shall describe the | ||||||
27 | applicant's plan for seeking investment opportunities, | ||||||
28 | evaluating and structuring investments fulfilling the | ||||||
29 | investment objectives and criteria established by the | ||||||
30 | Corporation, and achieving the financial and policy goals of | ||||||
31 | this Act. Upon completion of this evaluation, the committee | ||||||
32 | shall rank the applicants based on their qualifications and | ||||||
33 | recommend a fund manager or managers for selection to the board | ||||||
34 | of directors of the Corporation.
The board of directors of the | ||||||
35 | Corporation shall select an applicant or applicants based on | ||||||
36 | the recommendations of the committee, and shall notify the |
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1 | applicant or applicants selected in writing.
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2 | (j) The Corporation may charge a fee to the
Illinois
| ||||||
3 | Opportunity Fund, which shall be in addition to any fee payable | ||||||
4 | by the Illinois
Opportunity Fund to the fund manager or | ||||||
5 | managers engaged. The fee
payable
to the Corporation shall be | ||||||
6 | structured to cover the
reasonable
costs of the corporation in | ||||||
7 | fulfilling its oversight functions and of DCEO in
fulfilling | ||||||
8 | its
obligations under this Section and Section 25.
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9 | (k) The directors of the Corporation shall be
compensated | ||||||
10 | from the Illinois Opportunity Fund
for direct expenses and | ||||||
11 | mileage but shall not receive a director's fee or
salary for | ||||||
12 | their
service as directors.
| ||||||
13 | (l) The Corporation shall indemnify and defend members of | ||||||
14 | the board of directors of the Corporation for any and all | ||||||
15 | claims against the members of the board of directors arising | ||||||
16 | from or related to the performance of their duties to the | ||||||
17 | Corporation. | ||||||
18 | (m) The Corporation shall have the power to
engage
| ||||||
19 | consultants, expend funds, invest funds, contract, bond or | ||||||
20 | insure against loss, engage counsel,
and
perform any other act | ||||||
21 | necessary to carry out its mission. Without limiting the | ||||||
22 | foregoing, the Corporation may (i) borrow such funds as may be | ||||||
23 | needed to accomplish its goals; (ii) open and manage bank and | ||||||
24 | short-term investment accounts deemed necessary by its fund | ||||||
25 | manager or managers; and (iii) expend funds to secure | ||||||
26 | investment ratings. The Corporation shall not borrow more than | ||||||
27 | the difference between the aggregate amount of contingent tax | ||||||
28 | credits allowed and the aggregate amount of contingent tax | ||||||
29 | credits issued pursuant to Section 25 of this Act. The | ||||||
30 | Corporation shall engage a certified public accountant to | ||||||
31 | conduct an annual audit of its financial condition and | ||||||
32 | operations, including the Illinois Opportunity Fund.
| ||||||
33 | (n) The directors of the Corporation shall adopt
bylaws,
| ||||||
34 | policies, and procedures necessary to administer the affairs of | ||||||
35 | the
corporation.
| ||||||
36 | (o) Upon the dissolution of the Corporation, any
assets |
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| |||||||
1 | owned
by it shall thereupon be distributed to the General | ||||||
2 | Revenue Fund of the State of Illinois.
| ||||||
3 | (p) The meetings of the Board of directors, and any | ||||||
4 | committee thereof, are subject to the requirements of the Open | ||||||
5 | Meetings Act. The Board of Directors, and any committees | ||||||
6 | thereof, may hold a closed session to discuss and evaluate any | ||||||
7 | information submitted by applicants to be a fund manager of the | ||||||
8 | Illinois Opportunity Fund to the extent that information is | ||||||
9 | exempt from disclosure under subsection 1(g) or 1(h) of Section | ||||||
10 | 7 of the Freedom of Information Act. The procedural | ||||||
11 | requirements of the Open Meetings Act shall apply to this | ||||||
12 | closed session.
| ||||||
13 | Section 16. Fund Managers of the Illinois Opportunity Fund. | ||||||
14 | (a) Once selected by the directors of the Corporation, the | ||||||
15 | fund manager or managers of the Illinois Opportunity Fund shall | ||||||
16 | research and select venture capital and private equity | ||||||
17 | investment funds to recommend to the Corporation's board of | ||||||
18 | directors. | ||||||
19 | (b) The fund manager or managers of the Illinois | ||||||
20 | Opportunity Fund shall be compensated from funds raised for and | ||||||
21 | investment returns from the Illinois Opportunity Fund at a | ||||||
22 | level to be established by the directors of the Corporation and | ||||||
23 | consistent with industry norms. | ||||||
24 | (c) No less than 90 days after a majority of the members of | ||||||
25 | the Board of Directors of the Illinois Capital Investment | ||||||
26 | Corporation are nominated by the Governor and approved by the | ||||||
27 | Senate, the Board shall develop a policy adopted by resolution | ||||||
28 | of the Board stating the Board's plan for the use of financial | ||||||
29 | services corporations owned by minorities, females, and | ||||||
30 | persons with disabilities, as defined under the Business | ||||||
31 | Enterprise for Minorities, Females, and Persons with | ||||||
32 | Disabilities Act. The Board shall provide a copy of this | ||||||
33 | resolution to the Governor and the General Assembly upon its | ||||||
34 | adoption. | ||||||
35 | (d) On December 31st of each year, the Board shall report |
| |||||||
| |||||||
1 | to the General Assembly and the Governor regarding the use of | ||||||
2 | financial services corporations owned by minorities, females, | ||||||
3 | and persons with disabilities, as defined under the Business | ||||||
4 | Enterprise for Minorities, Females, and Persons with | ||||||
5 | Disabilities Act. | ||||||
6 | Section 20. Illinois Opportunity Fund.
| ||||||
7 | (a) The Corporation
shall organize
the Illinois | ||||||
8 | Opportunity Fund as a for-profit limited partnership or limited
| ||||||
9 | liability
company under Illinois law pursuant to which the | ||||||
10 | Corporation
shall be the general partner or managing member, as | ||||||
11 | the case may be.
| ||||||
12 | (b) The Corporation is authorized to issue such interests | ||||||
13 | or obligations that shall provide for a fixed or variable rate | ||||||
14 | of return as established by the Corporation with the consent of | ||||||
15 | DCEO. Consistent with this Act, DCEO may award contingent tax | ||||||
16 | credits to investors in the
Illinois
Opportunity Fund that | ||||||
17 | shall be redeemable if the Illinois Opportunity Fund
fails to
| ||||||
18 | achieve results sufficient to repay the amounts invested by the | ||||||
19 | investors and
provide
them with specified returns. Returns on | ||||||
20 | investments generated by the Illinois
Opportunity Fund in | ||||||
21 | excess of amounts required to (i) repay the amounts
invested by
| ||||||
22 | investors and provide them with specified returns, (ii) pay the | ||||||
23 | operating costs of the Corporation, including but not limited | ||||||
24 | to the agreed upon compensation of the fund manager or | ||||||
25 | managers, and (iii) pay all or an agreed upon portion of DCEO's | ||||||
26 | costs incurred in connection with the start-up of the | ||||||
27 | Corporation and the Illinois Opportunity Fund and such other | ||||||
28 | costs incurred by DCEO by providing assistance to the | ||||||
29 | Corporation consistent with this Act.
| ||||||
30 | (c) The Illinois Opportunity Fund shall operate as a fund | ||||||
31 | of funds
that
invests principally in high-quality | ||||||
32 | institutional, seed, angel, mezzanine, and
community
| ||||||
33 | development
venture capital funds and SBIC's that (i) maintain | ||||||
34 | a meaningful physical
presence in the
State of
Illinois, (ii) | ||||||
35 | are
managed by fund managers who commit
that their funds will |
| |||||||
| |||||||
1 | invest not less than the amount invested with them by the
| ||||||
2 | Illinois Opportunity Fund in businesses that are headquartered | ||||||
3 | or maintain
meaningful business operations in the State of | ||||||
4 | Illinois, and (iii) meet the
investment objectives
and criteria
| ||||||
5 | established by the Corporation consistent with this Act.
| ||||||
6 | (d) No more than 5% of the fully funded (as articulated in | ||||||
7 | Section 25 of this Act) Illinois Opportunity Fund shall be | ||||||
8 | invested in any single investment vehicle. No more than 33 1/3% | ||||||
9 | of the fully funded (as articulated in Section 25 of this Act) | ||||||
10 | Illinois Opportunity Fund shall be invested in any one calendar | ||||||
11 | year. In no event shall the Illinois Opportunity Fund represent | ||||||
12 | or compromise more than 25% of any single investment vehicle or | ||||||
13 | fund. | ||||||
14 | (e) Beginning on September 1 of the next calendar year | ||||||
15 | following the effective date of this Act and continuing on | ||||||
16 | every subsequent September 1 thereafter, the Corporation shall | ||||||
17 | provide to the General Assembly an annual report on its | ||||||
18 | activities and on the performance of the Illinois Opportunity | ||||||
19 | Fund. | ||||||
20 | (f) Twenty-five years after the creation of the Illinois | ||||||
21 | Opportunity Fund by the Corporation, the assets of the Fund
| ||||||
22 | shall be
liquidated following the payment of any obligations of | ||||||
23 | the Corporation or the Illinois Opportunity Fund as authorized | ||||||
24 | by this Act; any remaining assets shall be deposited into the | ||||||
25 | General Revenue Fund of the State treasury.
| ||||||
26 | Section 25. Contingent tax credits.
| ||||||
27 | (a) There is authorized to be awarded an aggregate of | ||||||
28 | $200,000,000 of
contingent
tax credits, reduced by the amount | ||||||
29 | of indebtedness to the Corporation, if any, which may be | ||||||
30 | allocated and issued by DCEO to investors
in the
Illinois | ||||||
31 | Opportunity Fund. DCEO shall not be obligated to issue | ||||||
32 | certificates
equal to
the full aggregate amount allowed by the | ||||||
33 | State of Illinois, and it may elect to
suspend or
terminate the | ||||||
34 | issuance of certificates at any time if it does not believe | ||||||
35 | that
the continued
issuance of certificates will assist the |
| |||||||
| |||||||
1 | State of Illinois in meeting the
objectives of this
Act. Tax | ||||||
2 | credits may be redeemed in any year but only as and to the
| ||||||
3 | extent the
Illinois Opportunity Fund is unable to return to its
| ||||||
4 | investors the
amounts initially invested plus the rate of | ||||||
5 | return specified in the interests or obligations authorized | ||||||
6 | pursuant to Section 20(b) of this Act. Tax credits shall be | ||||||
7 | redeemable not earlier than January 1, 2010 nor later than | ||||||
8 | December 31, 2033 as may be specified in any certificate.
| ||||||
9 | (b) The aggregate redemptions of tax credits issued by | ||||||
10 | DCEO, however, shall
not
exceed $40,000,000 in any fiscal year | ||||||
11 | of the State of Illinois.
| ||||||
12 | (c) All tax credits shall be evidenced by certificates. | ||||||
13 | DCEO shall establish
and
set forth in each certificate all | ||||||
14 | terms and conditions, including the return of the investment | ||||||
15 | principal and any fixed or variable rate of return, under
which | ||||||
16 | tax
credits may be redeemed. In establishing the terms of any | ||||||
17 | tax credits and
issuing
certificates, DCEO shall seek to | ||||||
18 | promote the purposes of this Act. Tax credits
may not
be | ||||||
19 | redeemed except in accordance with the terms of the certificate | ||||||
20 | under which
they
have been issued. The certificates shall, upon | ||||||
21 | proper issuance, be binding on DCEO and the Illinois Department | ||||||
22 | of Revenue. The State of Illinois irrevocably pledges and | ||||||
23 | covenants that, prior to the redemption of all certificates | ||||||
24 | awarded under this Act, it will not take action to limit or | ||||||
25 | restrict the ability of the holders of the certificates to | ||||||
26 | redeem the certificates in the form of tax credits.
| ||||||
27 | (d) Each certificate shall be redeemable in the form of a | ||||||
28 | tax credit upon the date set forth in the certificate, which | ||||||
29 | date shall not be earlier than January 1, 2010 nor later than | ||||||
30 | December 31, 2033. The value of each certificate at redemption | ||||||
31 | shall be its compounded value, equal to its face amount at the | ||||||
32 | date of issuance plus an additional amount equal to the face | ||||||
33 | amount multiplied by the rate of return established pursuant to | ||||||
34 | Section 20(b) of this Act. This additional amount shall be | ||||||
35 | calculated on an annual basis and added annually to the value | ||||||
36 | of the certificate in determining the compounded value upon |
| |||||||
| |||||||
1 | redemption. To the extent that the compounded value of any | ||||||
2 | certificate upon redemption thereof exceeds the amount of | ||||||
3 | applicable taxes imposed pursuant to Section 201 of the | ||||||
4 | Illinois Income Tax Act, the amount of that excess may be taken | ||||||
5 | as a tax credit in the subsequent tax year or years; provided | ||||||
6 | that the compounded value of a certificate shall not be | ||||||
7 | increased after its redemption date. DCEO and the Department of | ||||||
8 | Revenue shall promulgate rules regarding tax credits, tax | ||||||
9 | credit certificates, and the redemption thereof, and setting | ||||||
10 | forth, among other matters, the procedures for the calculating | ||||||
11 | of the compounded value of certificates and ability of a | ||||||
12 | certificate holder to redeem a portion of the compounded value | ||||||
13 | of any certificate in a year or years after the year of | ||||||
14 | redemption. The rate of return on each certificate shall under | ||||||
15 | no circumstances exceed the greater of 13 1/2% or 200% of the | ||||||
16 | rate for the most recent date shown in 20 G.O. Bonds Index of | ||||||
17 | Average Municipal Bond Yields as published in the most recent | ||||||
18 | edition of the Bond Buyer published in New York, New York, (or | ||||||
19 | any successor publication or index of long-term municipal bond | ||||||
20 | yields then selected by DCEO) at the time the certificate is | ||||||
21 | issued. Certificates may be redeemed only as and to the extent | ||||||
22 | that the Illinois Opportunity Fund is unable to return to its | ||||||
23 | investors the amounts initially invested plus the rate of | ||||||
24 | return specified in the interests or obligations authorized | ||||||
25 | pursuant to Section 20 (b) of this Act. | ||||||
26 | (e) Tax credits issued pursuant to this Section shall be | ||||||
27 | freely transferable
by their
holders. DCEO shall, in | ||||||
28 | conjunction with the Illinois Department of
Revenue,
develop a | ||||||
29 | system for registration of any tax credits allowed or | ||||||
30 | transferred
pursuant to this
Act that permits verification that | ||||||
31 | any tax credit claimed upon a tax return is
valid and
properly | ||||||
32 | taken in the year of claim, and that any transfers of the tax | ||||||
33 | credit
are made in
accordance with the requirements of this | ||||||
34 | Act.
| ||||||
35 | (f) Tax credits allowed or transferred pursuant to this Act | ||||||
36 | shall not be
considered
securities under any Illinois law |
| |||||||
| |||||||
1 | relating to securities.
| ||||||
2 | Section 30. Powers and effectiveness. Nothing contained in | ||||||
3 | this Act is or
shall be
construed as a restriction or | ||||||
4 | limitation upon any powers that DCEO might
otherwise have
under | ||||||
5 | any other law of this State, and the provisions of this Act are
| ||||||
6 | cumulative to those
powers. The provisions of this Act do and | ||||||
7 | shall be construed to provide a
complete,
additional, and | ||||||
8 | alternative method for the doing of the things authorized and
| ||||||
9 | shall be
regarded as supplemental and additional to powers | ||||||
10 | conferred by any other laws.
| ||||||
11 | Section 35. Acceptable investments. Investments by | ||||||
12 | designated investors in
the
Illinois Opportunity Fund shall be | ||||||
13 | deemed permissible investments for State
chartered
banks and | ||||||
14 | for domestic insurance companies under the appropriate laws of | ||||||
15 | the
State of
Illinois.
| ||||||
16 | Section 40. Illinois Opportunity Special Projects Fund. | ||||||
17 | The Illinois
Opportunity Special Projects Fund is created as a | ||||||
18 | special fund in the State
treasury. DCEO may accept | ||||||
19 | disbursements from the Illinois Opportunity Fund for
deposit | ||||||
20 | into the Illinois Opportunity Special Projects Fund and
expend | ||||||
21 | those funds for the purposes set forth in Sections 15(g), | ||||||
22 | 16(b), and 20(b) of
this Act, subject to appropriation.
| ||||||
23 | Section 100. The Illinois State Auditing Act is amended by | ||||||
24 | changing Section 3-1 as follows:
| ||||||
25 | (30 ILCS 5/3-1) (from Ch. 15, par. 303-1)
| ||||||
26 | Sec. 3-1. Jurisdiction of Auditor General. The Auditor | ||||||
27 | General has
jurisdiction over all State agencies to make post | ||||||
28 | audits and investigations
authorized by or under this Act or | ||||||
29 | the Constitution.
| ||||||
30 | The Auditor General has jurisdiction over local government | ||||||
31 | agencies
and private agencies only:
|
| |||||||
| |||||||
1 | (a) to make such post audits authorized by or under | ||||||
2 | this Act as are
necessary and incidental to a post audit of | ||||||
3 | a State agency or of a
program administered by a State | ||||||
4 | agency involving public funds of the
State, but this | ||||||
5 | jurisdiction does not include any authority to review
local | ||||||
6 | governmental agencies in the obligation, receipt, | ||||||
7 | expenditure or
use of public funds of the State that are | ||||||
8 | granted without limitation or
condition imposed by law, | ||||||
9 | other than the general limitation that such
funds be used | ||||||
10 | for public purposes;
| ||||||
11 | (b) to make investigations authorized by or under this | ||||||
12 | Act or the
Constitution; and
| ||||||
13 | (c) to make audits of the records of local government | ||||||
14 | agencies to verify
actual costs of state-mandated programs | ||||||
15 | when directed to do so by the
Legislative Audit Commission | ||||||
16 | at the request of the State Board of Appeals
under the | ||||||
17 | State Mandates Act.
| ||||||
18 | In addition to the foregoing, the Auditor General may | ||||||
19 | conduct an
audit of the Metropolitan Pier and Exposition | ||||||
20 | Authority, the
Regional Transportation Authority, the Suburban | ||||||
21 | Bus Division, the Commuter
Rail Division and the Chicago | ||||||
22 | Transit Authority and any other subsidized
carrier when | ||||||
23 | authorized by the Legislative Audit Commission. Such audit
may | ||||||
24 | be a financial, management or program audit, or any combination | ||||||
25 | thereof.
| ||||||
26 | The audit shall determine whether they are operating in | ||||||
27 | accordance with
all applicable laws and regulations. Subject to | ||||||
28 | the limitations of this
Act, the Legislative Audit Commission | ||||||
29 | may by resolution specify additional
determinations to be | ||||||
30 | included in the scope of the audit.
| ||||||
31 | In addition to the foregoing, the Auditor General must also | ||||||
32 | conduct a
financial audit of
the Illinois Sports Facilities | ||||||
33 | Authority's expenditures of public funds in
connection with the | ||||||
34 | reconstruction, renovation, remodeling, extension, or
| ||||||
35 | improvement of all or substantially all of any existing | ||||||
36 | "facility", as that
term is defined in the Illinois Sports |
| |||||||
| |||||||
1 | Facilities Authority Act.
| ||||||
2 | The Auditor General may also conduct an audit, when | ||||||
3 | authorized by
the Legislative Audit Commission, of any hospital | ||||||
4 | which receives 10% or
more of its gross revenues from payments | ||||||
5 | from the State of Illinois,
Department of Public Aid, Medical | ||||||
6 | Assistance Program.
| ||||||
7 | The Auditor General is authorized to conduct financial and | ||||||
8 | compliance
audits of the Illinois Distance Learning Foundation | ||||||
9 | and the Illinois
Conservation Foundation.
| ||||||
10 | As soon as practical after the effective date of this | ||||||
11 | amendatory Act of
1995, the Auditor General shall conduct a | ||||||
12 | compliance and management audit of
the City of
Chicago and any | ||||||
13 | other entity with regard to the operation of Chicago O'Hare
| ||||||
14 | International Airport, Chicago Midway Airport and Merrill C. | ||||||
15 | Meigs Field. The
audit shall include, but not be limited to, an | ||||||
16 | examination of revenues,
expenses, and transfers of funds; | ||||||
17 | purchasing and contracting policies and
practices; staffing | ||||||
18 | levels; and hiring practices and procedures. When
completed, | ||||||
19 | the audit required by this paragraph shall be distributed in
| ||||||
20 | accordance with Section 3-14.
| ||||||
21 | The Auditor General shall conduct a financial and | ||||||
22 | compliance and program
audit of distributions from the | ||||||
23 | Municipal Economic Development Fund
during the immediately | ||||||
24 | preceding calendar year pursuant to Section 8-403.1 of
the | ||||||
25 | Public Utilities Act at no cost to the city, village, or | ||||||
26 | incorporated town
that received the distributions.
| ||||||
27 | The Auditor General must conduct an audit of the Health | ||||||
28 | Facilities Planning
Board pursuant to Section 19.5 of the | ||||||
29 | Illinois Health Facilities Planning
Act.
| ||||||
30 | The Auditor General of the State of Illinois shall annually | ||||||
31 | conduct or
cause to be conducted a financial and compliance | ||||||
32 | audit of the books and records
of any county water commission | ||||||
33 | organized pursuant to the Water Commission Act
of 1985 and | ||||||
34 | shall file a copy of the report of that audit with the Governor | ||||||
35 | and
the Legislative Audit Commission. The filed audit shall be | ||||||
36 | open to the public
for inspection. The cost of the audit shall |
| |||||||
| |||||||
1 | be charged to the county water
commission in accordance with | ||||||
2 | Section 6z-27 of the State Finance Act. The
county water | ||||||
3 | commission shall make available to the Auditor General its | ||||||
4 | books
and records and any other documentation, whether in the | ||||||
5 | possession of its
trustees or other parties, necessary to | ||||||
6 | conduct the audit required. These
audit requirements apply only | ||||||
7 | through July 1, 2007.
| ||||||
8 | The Auditor General must conduct audits of the Rend Lake | ||||||
9 | Conservancy
District as provided in Section 25.5 of the River | ||||||
10 | Conservancy Districts Act.
| ||||||
11 | The Auditor General must conduct financial audits of the | ||||||
12 | Southeastern Illinois Economic Development Authority as | ||||||
13 | provided in Section 70 of the Southeastern Illinois Economic | ||||||
14 | Development Authority Act.
| ||||||
15 | The Auditor General must conduct financial and compliance | ||||||
16 | audits of the Illinois Capital Investment Corporation and the | ||||||
17 | Illinois Opportunity Fund.
| ||||||
18 | (Source: P.A. 93-226, eff. 7-22-03; 93-259, eff. 7-22-03; | ||||||
19 | 93-275, eff. 7-22-03; 93-968, eff. 8-20-04.)
| ||||||
20 | Section 105. The State Finance Act is amended by adding | ||||||
21 | Section 5.640 as
follows:
| ||||||
22 | (30 ILCS 105/5.640 new)
| ||||||
23 | Sec. 5.640. The Illinois Opportunity Special Projects | ||||||
24 | Fund.
| ||||||
25 | Section 110. Severability. The provisions of this Act are | ||||||
26 | severable under Section 1.31 of the Statute on Statutes.
| ||||||
27 | Section 999. Effective date. This Act takes effect upon | ||||||
28 | becoming law.
|