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1 | AN ACT concerning 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 5. The Illinois Finance Authority Act is amended by | ||||||
5 | changing Sections 805-5, 805-15, 805-20, 830-5, 830-35, | ||||||
6 | 830-45, and 830-50 and by adding Section 830-55 as follows:
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7 | (20 ILCS 3501/805-5)
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8 | Sec. 805-5. Findings and Declaration of Policy. It is | ||||||
9 | hereby found and
declared that a continuing need exists to | ||||||
10 | maintain and develop the State's
economy; that there are | ||||||
11 | significant barriers in the capital markets inhibiting
the | ||||||
12 | issuance by the Authority of industrial revenue bonds , loans, | ||||||
13 | and State Guarantees to assist in
financing
industrial | ||||||
14 | projects , farmers, and agribusiness in the State, particularly | ||||||
15 | for smaller firms; and that the
establishment of the Industrial | ||||||
16 | Revenue Bond Insurance Fund and the exercise by
the Authority | ||||||
17 | of the powers granted in
this Article will promote
economic | ||||||
18 | development by widening the market for the Authority's revenue | ||||||
19 | bonds , loans, and State Guarantees .
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20 | (Source: P.A. 93-205, eff. 1-1-04.)
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21 | (20 ILCS 3501/805-15)
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22 | Sec. 805-15. Industrial Project Insurance Fund. There is |
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1 | created the
Industrial Project Insurance Fund, hereafter | ||||||
2 | referred to in
Sections 805-15
through 805-50 of this Act as | ||||||
3 | the "Fund". The Treasurer shall have custody of
the
Fund, which | ||||||
4 | shall be held outside of the State treasury, except that | ||||||
5 | custody
may
be transferred to and held by any bank, trust | ||||||
6 | company or other fiduciary with
whom the Authority executes a | ||||||
7 | trust agreement as authorized by paragraph (h) of
Section | ||||||
8 | 805-20 of this Act. Any portion of the Fund against which a | ||||||
9 | charge has
been made, shall be held for the benefit of the | ||||||
10 | holders of the loans or bonds
insured under
Section 805-20 of | ||||||
11 | this Act or the holders of State Guarantees under Article 830 | ||||||
12 | of this Act .
There shall be deposited in the Fund such amounts, | ||||||
13 | including but not limited
to:
| ||||||
14 | (a) All receipts of bond and loan insurance premiums;
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15 | (b) All proceeds of assets of whatever nature received by | ||||||
16 | the Authority as a
result of default or delinquency with | ||||||
17 | respect to insured loans or bonds or State Guarantees with
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18 | respect to which payments from the Fund have been made, | ||||||
19 | including proceeds from
the sale, disposal, lease or rental of | ||||||
20 | real or personal property which the
Authority may receive under | ||||||
21 | the provisions of
this Article but excluding the proceeds of | ||||||
22 | insurance hereunder;
| ||||||
23 | (c) All receipts from any applicable contract or agreement | ||||||
24 | entered into by
the Authority under paragraph (b) of Section | ||||||
25 | 805-20 of this Act;
| ||||||
26 | (d) Any State appropriations, transfers of appropriations, |
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| |||||||
1 | or transfers of
general obligation bond proceeds or other | ||||||
2 | monies made available to the Fund.
Amounts in the Fund shall be | ||||||
3 | used in accordance with the provisions of
this Article to | ||||||
4 | satisfy any valid insurance claim payable
therefrom and may be | ||||||
5 | used for any other purpose determined by the Authority in
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6 | accordance with insurance contract or contracts with financial | ||||||
7 | institutions
entered into pursuant to this Act, including | ||||||
8 | without limitation protecting the
interest of the Authority in | ||||||
9 | industrial projects during periods of loan
delinquency or upon | ||||||
10 | loan default through the purchase of industrial projects in
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11 | foreclosure proceedings or in lieu of foreclosure or through | ||||||
12 | any other means.
Such amounts may also be used to pay | ||||||
13 | administrative costs and expenses
reasonably allocable to the | ||||||
14 | activities in connection with the Fund and to pay
taxes, | ||||||
15 | maintenance, insurance, security and any other costs and | ||||||
16 | expenses of
bidding for, acquiring, owning, carrying and | ||||||
17 | disposing of industrial projects
which were financed with the | ||||||
18 | proceeds of insured bonds or loans. In the case of
a default in | ||||||
19 | payment with respect to any loan, mortgage or other agreement | ||||||
20 | so
insured, the amount of the default shall immediately, and at | ||||||
21 | all times during
the continuance of such default, and to the | ||||||
22 | extent provided in any applicable
agreement, constitute a | ||||||
23 | charge on the Fund.
Any amounts in the Fund not currently | ||||||
24 | needed to meet the obligations of the
Fund may be invested as | ||||||
25 | provided by law in obligations designated by the
Authority,
and | ||||||
26 | all income from such investments shall become part of the Fund. |
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1 | In making
such investments, the Authority shall act with the | ||||||
2 | care, skill, diligence and
prudence under the circumstances of | ||||||
3 | a prudent person acting in a like capacity
in the conduct of an | ||||||
4 | enterprise of like character and with like aims. It shall
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5 | diversify such investments of the Authority so as to minimize | ||||||
6 | the risk of large
losses, unless under the circumstances it is | ||||||
7 | clearly not prudent to do so.
Amounts in the Fund may also be | ||||||
8 | used to satisfy State Guarantees under Article 830 of this Act.
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9 | (Source: P.A. 93-205, eff. 1-1-04; 94-91, eff. 7-1-05.)
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10 | (20 ILCS 3501/805-20)
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11 | Sec. 805-20. Powers and Duties; Industrial Project | ||||||
12 | Insurance Program. The
Authority has the power:
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13 | (a) To insure and make advance commitments to insure all or | ||||||
14 | any part of the
payments required on the bonds issued or a loan | ||||||
15 | made to finance any
environmental facility under the Illinois | ||||||
16 | Environmental Facilities Financing
Act
or for any industrial | ||||||
17 | project upon such terms and conditions as the Authority
may | ||||||
18 | prescribe in accordance with
this Article. The
insurance | ||||||
19 | provided by the Authority shall be payable solely from the Fund
| ||||||
20 | created by
Section 805-15 and shall not constitute a debt or | ||||||
21 | pledge of the full
faith and credit of the State, the | ||||||
22 | Authority, or any political subdivision
thereof;
| ||||||
23 | (b) To enter into insurance contracts, letters of credit or | ||||||
24 | any other
agreements or contracts with financial institutions | ||||||
25 | with respect to the Fund
and
any bonds or loans insured |
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1 | thereunder. Any such agreement or contract may
contain terms | ||||||
2 | and provisions necessary or desirable in connection with the
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3 | program, subject to the requirements established by this Act, | ||||||
4 | including without
limitation terms and provisions relating to | ||||||
5 | loan documentation, review and
approval procedures, | ||||||
6 | origination and servicing rights and responsibilities,
default | ||||||
7 | conditions, procedures and obligations with respect to | ||||||
8 | insurance
contracts made under this Act. The agreements or | ||||||
9 | contracts may be executed on
an individual, group or master | ||||||
10 | contract basis with financial institutions;
| ||||||
11 | (c) To charge reasonable fees to defray the cost of | ||||||
12 | obtaining letters of
credit
or other similar documents, other | ||||||
13 | than insurance contracts under paragraph (b).
Any such fees | ||||||
14 | shall be payable by such person, in such amounts and at such
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15 | times
as the Authority shall determine, and the amount of the | ||||||
16 | fees need not be
uniform
among the various bonds or loans | ||||||
17 | insured;
| ||||||
18 | (d) To fix insurance premiums for the insurance of payments | ||||||
19 | under the
provisions of
this Article. Such premiums shall be
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20 | computed as determined by the Authority. Any premiums for the | ||||||
21 | insurance of loan
payments under the provisions of this Act | ||||||
22 | shall be payable by such person, in
such amounts and at such | ||||||
23 | times as the Authority shall determine, and the amount
of the | ||||||
24 | premiums need not be uniform among the various bonds or loans | ||||||
25 | insured;
| ||||||
26 | (e) To establish application fees and prescribe |
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1 | application, notification,
contract and insurance forms, rules | ||||||
2 | and regulations it deems necessary or
appropriate;
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3 | (f) To make loans and to issue bonds secured by insurance | ||||||
4 | or other
agreements
authorized by paragraphs (a) and (b) of | ||||||
5 | this
Section 805-20 and to issue bonds
secured by loans that | ||||||
6 | are guaranteed by the federal government or agencies
thereof;
| ||||||
7 | (g) To issue a single bond issue, or a series of bond | ||||||
8 | issues, for a group of
industrial projects, a group of | ||||||
9 | corporations, or a group of business entities
or
any | ||||||
10 | combination thereof insured by insurance or backed by any other | ||||||
11 | agreement
authorized by paragraphs (a) and (b) of this
Section | ||||||
12 | or secured by loans that
are guaranteed by the federal | ||||||
13 | government or agencies thereof;
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14 | (h) To enter into trust agreements for the management of | ||||||
15 | the Fund created
under Section 805-15 of this Act; and
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16 | (i) To exercise such other powers as are necessary or | ||||||
17 | incidental to the powers granted in this Section and to the | ||||||
18 | issuance of State Guarantees under Article 830 of this Act
| ||||||
19 | foregoing .
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20 | (j) At the discretion of the Authority, to insure and make | ||||||
21 | advance commitments to insure, and issue State Guarantees for, | ||||||
22 | all or any part of the payments required on the bonds issued or | ||||||
23 | loans made to finance any agricultural facility, project, | ||||||
24 | farmer, producer, agribusiness, or program under Article 830 of | ||||||
25 | this Act upon such terms and conditions as the Authority may | ||||||
26 | prescribe in accordance with this Article. The insurance and |
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1 | State Guarantees provided by the Authority may be payable from | ||||||
2 | the Fund created by Section 805-15 and is in addition to and | ||||||
3 | not in replacement of the Illinois Agricultural Loan Guarantee | ||||||
4 | Fund and the Illinois Farmer and Agribusiness Loan Guarantee | ||||||
5 | Fund created under Article 830 of this Act. | ||||||
6 | (Source: P.A. 93-205, eff. 1-1-04.)
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7 | (20 ILCS 3501/830-5)
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8 | Sec. 830-5. The Authority shall have the following powers:
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9 | (a) To loan its funds to one or more persons to be used by | ||||||
10 | such persons to
pay
the costs of acquiring, constructing, | ||||||
11 | reconstructing or improving Agricultural
Facilities, soil or | ||||||
12 | water conservation projects or watershed areas, such loans
to | ||||||
13 | be on such terms and conditions, and for such period of time, | ||||||
14 | and secured or
evidenced by such mortgages, deeds of trust, | ||||||
15 | notes, debentures, bonds or other
secured or unsecured | ||||||
16 | evidences of indebtedness of such persons as the Board may
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17 | determine;
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18 | (b) To loan its funds to any agribusiness which operates or | ||||||
19 | will operate a
facility located in Illinois for those purposes | ||||||
20 | permitted by rules and
regulations issued pursuant to the | ||||||
21 | Internal Revenue Code of 1954, as amended,
relating to the use | ||||||
22 | of moneys loaned from the proceeds from the issuance of
| ||||||
23 | industrial development revenue bonds; such loans shall be on | ||||||
24 | terms and
conditions, and for periods of time, and secured or | ||||||
25 | evidenced by mortgages,
deeds of trust, notes, debentures, |
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1 | bonds or other secured or unsecured
evidences
of indebtedness | ||||||
2 | of such agribusiness as the Board may require;
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3 | (c) To purchase, or to make commitments to purchase, from | ||||||
4 | lenders notes,
debentures, bonds or other evidences of | ||||||
5 | indebtedness secured by mortgages,
deeds of trust, or security | ||||||
6 | devices, or unsecured, as the Authority may
determine, or | ||||||
7 | portions thereof or participations therein, which notes, | ||||||
8 | bonds,
or other evidences of indebtedness shall have been or | ||||||
9 | will be executed by the
obligors thereon to obtain funds with | ||||||
10 | which to acquire, by purchase,
construction, or otherwise, | ||||||
11 | reconstruct or improve Agricultural Facilities;
| ||||||
12 | (d) To contract with lenders or others for the origination | ||||||
13 | of or the
servicing
of the loans made by the Authority pursuant | ||||||
14 | to this
Section or
represented by the notes, bonds, or other | ||||||
15 | evidences of indebtedness which it
has purchased pursuant to | ||||||
16 | this
Section; provided that such
servicing fees shall not | ||||||
17 | exceed one percent per annum of the principal amount
| ||||||
18 | outstanding owed to the Authority; and
| ||||||
19 | (e) To enter into a State Guarantee with a lender or a | ||||||
20 | person holding a note
and
to sell or issue such State | ||||||
21 | Guarantees, bonds or evidences of indebtedness in a
primary or | ||||||
22 | a secondary market and to make payment on a State Guarantee | ||||||
23 | from available sources, including but not limited to, the | ||||||
24 | Illinois Agricultural Loan Guarantee Fund and the Illinois | ||||||
25 | Farmer and Agribusiness Loan Guarantee Fund created under | ||||||
26 | Section 830-30 and Section 830-35, respectively, and the |
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| |||||||
1 | Industrial Project Insurance Fund created under Article 805 of | ||||||
2 | this Act .
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3 | (Source: P.A. 93-205, eff. 1-1-04.)
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4 | (20 ILCS 3501/830-35)
| ||||||
5 | Sec. 830-35.
State Guarantees for loans to farmers and | ||||||
6 | agribusiness;
eligibility.
| ||||||
7 | (a) The Authority is authorized to issue State Guarantees | ||||||
8 | to lenders for
loans
to eligible farmers and agribusinesses for | ||||||
9 | purposes set forth in this
Section.
For purposes of this
| ||||||
10 | Section, an eligible farmer shall be a resident of Illinois
(i) | ||||||
11 | who is principal operator of a farm or land, at least 50% of | ||||||
12 | whose annual
gross income is derived from farming, (ii) whose | ||||||
13 | annual total sales of
agricultural products, commodities, or | ||||||
14 | livestock exceeds $20,000, and (iii)
whose net worth does not | ||||||
15 | exceed $500,000. An eligible agribusiness shall be
that as | ||||||
16 | defined in
Section 801-10 of this Act.
The Authority may | ||||||
17 | approve applications by farmers and agribusinesses that
| ||||||
18 | promote diversification of the farm economy of this State | ||||||
19 | through the growth
and
development of new crops or livestock | ||||||
20 | not customarily grown or produced in this
State or that | ||||||
21 | emphasize a vertical integration of grain or livestock produced
| ||||||
22 | or
raised in this State into a finished agricultural product | ||||||
23 | for consumption or
use. "New crops or livestock not customarily | ||||||
24 | grown or produced in this State"
shall not include corn, | ||||||
25 | soybeans, wheat, swine, or beef or dairy cattle.
"Vertical |
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1 | integration of grain or livestock produced or raised in this | ||||||
2 | State"
shall include any new or existing grain or livestock | ||||||
3 | grown or produced in this
State.
Lenders shall apply for the | ||||||
4 | State Guarantees on forms provided by the
Authority,
certify | ||||||
5 | that the application and any other documents submitted are true | ||||||
6 | and
correct, and pay an administrative fee as determined by the | ||||||
7 | Authority. The
applicant shall be responsible for paying any | ||||||
8 | fees or charges involved in
recording mortgages, releases, | ||||||
9 | financing statements, insurance for secondary
market issues | ||||||
10 | and any other similar fees or charges as the Authority may
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11 | require. The application shall at a minimum contain the | ||||||
12 | farmer's or
agribusiness' name, address, present credit and | ||||||
13 | financial information,
including cash flow statements, | ||||||
14 | financial statements, balance sheets, and any
other
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15 | information pertinent to the application, and the collateral to | ||||||
16 | be used to
secure the State Guarantee. In addition, the lender | ||||||
17 | must agree to charge an
interest rate, which may vary, on the | ||||||
18 | loan that the Authority determines to be
below the market rate | ||||||
19 | of interest generally available to the borrower. If both
the | ||||||
20 | lender and applicant agree, the interest rate on the State | ||||||
21 | Guarantee Loan
can be converted to a fixed interest rate at any | ||||||
22 | time during the term of the
loan.
Any State Guarantees provided | ||||||
23 | under this
Section (i) shall not exceed $500,000
per farmer or | ||||||
24 | an amount as determined by the Authority on a case-by-case
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25 | basis for an agribusiness, (ii) shall not exceed a term of 15 | ||||||
26 | years, and (iii)
shall be subject to an annual review and |
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| |||||||
1 | renewal by the lender and the
Authority; provided that only one | ||||||
2 | such State Guarantee shall be made per farmer
or agribusiness, | ||||||
3 | except that additional State Guarantees may be made for
| ||||||
4 | purposes of expansion of projects financed in part by a | ||||||
5 | previously issued State
Guarantee. No State Guarantee shall be | ||||||
6 | revoked by the Authority without a
90-day notice, in writing, | ||||||
7 | to all parties. The lender shall not call due any
loan
for any | ||||||
8 | reason except for lack of performance, insufficient | ||||||
9 | collateral, or
maturity. A lender may review and withdraw or | ||||||
10 | continue with a State Guarantee
on an annual basis after the | ||||||
11 | first 5 years following closing of the loan
application if the | ||||||
12 | loan contract provides for an interest rate that shall not
| ||||||
13 | vary. A lender shall not withdraw a State Guarantee if the loan | ||||||
14 | contract
provides for an interest rate that may vary, except | ||||||
15 | for reasons set forth
herein.
| ||||||
16 | (b) The Authority shall provide or renew a State Guarantee | ||||||
17 | to a lender if:
| ||||||
18 | (i) A fee equal to 25 basis points on the loan is paid | ||||||
19 | to the Authority on
an annual
basis by the lender.
| ||||||
20 | (ii) The application provides collateral acceptable to | ||||||
21 | the
Authority that is at least equal to the State's portion | ||||||
22 | of the Guarantee to be
provided.
| ||||||
23 | (iii) The lender assumes all responsibility and costs | ||||||
24 | for pursuing
legal action on collecting any loan that is | ||||||
25 | delinquent or in default.
| ||||||
26 | (iv) The
lender is responsible for the first 15% of the |
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| |||||||
1 | outstanding principal of the
note
for which the State | ||||||
2 | Guarantee has been applied.
| ||||||
3 | (c) There is hereby created outside of the State treasury a | ||||||
4 | special fund to
be
known as the Illinois Farmer and | ||||||
5 | Agribusiness Loan Guarantee Fund. The State
Treasurer shall be | ||||||
6 | custodian of this Fund. Any amounts in the Fund not
currently | ||||||
7 | needed to meet the obligations of the Fund shall be invested as
| ||||||
8 | provided by law, and all interest earned from these investments | ||||||
9 | shall be
deposited into the Fund until the Fund reaches the | ||||||
10 | maximum amounts authorized
in
this Act; thereafter, interest | ||||||
11 | earned shall be deposited into the General
Revenue Fund. After | ||||||
12 | September 1, 1989, annual investment earnings equal to 1.5%
of | ||||||
13 | the Fund shall remain in the Fund to be used for the purposes | ||||||
14 | established in
Section 830-40 of this Act. The Authority is | ||||||
15 | authorized to transfer such
amounts
as are necessary to satisfy | ||||||
16 | claims from available appropriations and from fund
balances of | ||||||
17 | the Farm Emergency Assistance Fund as of June 30 of each year | ||||||
18 | to
the
Illinois Farmer and Agribusiness Loan Guarantee Fund to | ||||||
19 | secure State Guarantees
issued under this
Section and
Sections | ||||||
20 | 830-45 , and 830-50 , and 830-55 . If for any reason the
General | ||||||
21 | Assembly fails to make an appropriation sufficient to meet | ||||||
22 | these
obligations, this Act shall constitute an irrevocable and | ||||||
23 | continuing
appropriation of an amount necessary to secure | ||||||
24 | guarantees as defaults occur and
the irrevocable and continuing | ||||||
25 | authority for, and direction to, the State
Treasurer and the | ||||||
26 | Comptroller to make the necessary transfers to the Illinois
|
| |||||||
| |||||||
1 | Farmer and Agribusiness Loan Guarantee Fund, as directed by the | ||||||
2 | Governor, out
of
the General Revenue Fund. In the event of | ||||||
3 | default by the borrower on State
Guarantee Loans under this
| ||||||
4 | Section,
Section 830-45 , or
Section 830-50, or Section 830-55, | ||||||
5 | the lender
shall be entitled to, and the Authority shall direct | ||||||
6 | payment on, the State
Guarantee after 90 days of delinquency. | ||||||
7 | All payments by the Authority shall be
made from the Illinois | ||||||
8 | Farmer and Agribusiness Loan Guarantee Fund to satisfy
claims | ||||||
9 | against the State Guarantee. It shall be the responsibility of | ||||||
10 | the
lender to proceed with the collecting and disposing of | ||||||
11 | collateral on the State
Guarantee under this
Section,
Section | ||||||
12 | 830-45 , or
Section 830-50 , or Section 830-55 within 14 months | ||||||
13 | of
the time the State Guarantee is declared delinquent. If the | ||||||
14 | lender does not
dispose of the collateral within 14 months, the | ||||||
15 | lender shall be liable to repay
to the State interest on the | ||||||
16 | State Guarantee equal to the same rate that the
lender charges | ||||||
17 | on the State Guarantee, provided that the Authority shall have
| ||||||
18 | the authority to extend the 14-month period for a lender in the | ||||||
19 | case of
bankruptcy or extenuating circumstances. The Fund shall | ||||||
20 | be reimbursed for any
amounts paid under this
Section,
Section | ||||||
21 | 830-45 , or
Section 830-50 , or Section 830-55 upon liquidation
| ||||||
22 | of the collateral.
The Authority, by resolution of the Board, | ||||||
23 | may borrow sums from the Fund and
provide for repayment as soon | ||||||
24 | as may be practical upon receipt of payments of
principal and | ||||||
25 | interest by a borrower on State Guarantee Loans under this
| ||||||
26 | Section,
Section 830-45 , or
Section 830-50 , or Section 830-55 . |
| |||||||
| |||||||
1 | Money may be borrowed from the Fund by
the Authority for the | ||||||
2 | sole purpose of paying certain interest costs for
borrowers | ||||||
3 | associated with selling a loan subject to a State Guarantee | ||||||
4 | under
this
Section,
Section 830-45 , or
Section 830-50 , or | ||||||
5 | Section 830-55 in a secondary market as may be deemed
| ||||||
6 | reasonable and necessary by the Authority.
| ||||||
7 | (d) Notwithstanding the provisions of this
Section 830-35 | ||||||
8 | with respect to the
farmers, agribusinesses, and lenders who | ||||||
9 | may obtain State Guarantees, the
Authority may promulgate rules | ||||||
10 | establishing the eligibility of farmers,
agribusinesses, and | ||||||
11 | lenders to participate in the State Guarantee program and
the | ||||||
12 | terms, standards, and procedures that will apply, when the | ||||||
13 | Authority finds
that emergency conditions in Illinois | ||||||
14 | agriculture have created the need for
State Guarantees pursuant | ||||||
15 | to terms, standards, and procedures other than those
specified | ||||||
16 | in this
Section.
| ||||||
17 | (Source: P.A. 93-205, eff. 1-1-04.)
| ||||||
18 | (20 ILCS 3501/830-45)
| ||||||
19 | Sec. 830-45. Young Farmer Loan Guarantee Program.
| ||||||
20 | (a) The Authority is authorized to issue State Guarantees | ||||||
21 | to lenders for
loans
to finance or refinance debts of young | ||||||
22 | farmers. For the purposes of this
Section, a young farmer is a | ||||||
23 | resident of Illinois who is at least 18 years of
age and who is | ||||||
24 | a principal operator of a farm or land, who derives at least | ||||||
25 | 50%
of annual gross income from farming, whose net worth is not |
| |||||||
| |||||||
1 | less than $10,000
and whose debt to asset ratio is not less | ||||||
2 | than 40%. For the purposes of this
Section, debt to asset ratio | ||||||
3 | means current outstanding liabilities, including
any debt to be | ||||||
4 | financed or refinanced under this
Section 830-45, divided by
| ||||||
5 | current outstanding assets. The Authority shall establish the | ||||||
6 | maximum
permissible debt to asset ratio based on criteria | ||||||
7 | established by the Authority.
Lenders shall apply for the State | ||||||
8 | Guarantees on forms provided by the Authority
and certify that | ||||||
9 | the application and any other documents submitted are true and
| ||||||
10 | correct. The lender or borrower, or both in combination, shall | ||||||
11 | pay an
administrative fee as determined by the Authority. The | ||||||
12 | applicant shall be
responsible for paying any fee or charge | ||||||
13 | involved in recording mortgages,
releases, financing | ||||||
14 | statements, insurance for secondary market issues, and any
| ||||||
15 | other similar fee or charge that the Authority may require. The | ||||||
16 | application
shall at a minimum contain the young farmer's name, | ||||||
17 | address, present credit and
financial information, including | ||||||
18 | cash flow statements, financial statements,
balance sheets, | ||||||
19 | and any other information pertinent to the application, and the
| ||||||
20 | collateral to be used to secure the State Guarantee. In | ||||||
21 | addition, the borrower
must certify to the Authority that, at | ||||||
22 | the time the State Guarantee is
provided,
the borrower will not | ||||||
23 | be delinquent in the repayment of any debt. The lender
must | ||||||
24 | agree to charge a fixed or adjustable interest rate that the | ||||||
25 | Authority
determines to be below the market rate of interest | ||||||
26 | generally available to the
borrower. If both the lender and |
| |||||||
| |||||||
1 | applicant agree, the interest rate on the
State guaranteed loan | ||||||
2 | can be converted to a fixed interest rate at any time
during | ||||||
3 | the term of the loan.
State Guarantees provided under this
| ||||||
4 | Section (i) shall not exceed $500,000 per
young farmer, (ii) | ||||||
5 | shall be set up on a payment schedule not to exceed 30
years,
| ||||||
6 | but shall be no longer than 15 years in duration, and (iii) | ||||||
7 | shall be subject to
an annual review and renewal by the lender | ||||||
8 | and the Authority. A young farmer
may
use this program more | ||||||
9 | than once provided the aggregate principal amount of
State
| ||||||
10 | Guarantees under this
Section to that young farmer does not | ||||||
11 | exceed $500,000. No
State Guarantee shall be revoked by the | ||||||
12 | Authority without a 90-day notice, in
writing, to all parties.
| ||||||
13 | (b) The Authority shall provide or renew a State Guarantee | ||||||
14 | to a lender if:
| ||||||
15 | (i) The lender pays a fee equal to 25 basis points on | ||||||
16 | the loan to the
Authority on
an annual basis.
| ||||||
17 | (ii) The application provides collateral acceptable to | ||||||
18 | the
Authority that is at least equal to the State | ||||||
19 | Guarantee.
| ||||||
20 | (iii) The lender
assumes all responsibility and costs | ||||||
21 | for pursuing legal action on collecting
any
loan that is | ||||||
22 | delinquent or in default.
| ||||||
23 | (iv) The lender is at risk for the
first 15% of the | ||||||
24 | outstanding principal of the note for which the State
| ||||||
25 | Guarantee
is provided.
| ||||||
26 | (c) The Illinois Agricultural Loan Guarantee Fund and the |
| |||||||
| |||||||
1 | Illinois Farmer and Agribusiness Loan Guarantee Fund may be | ||||||
2 | used to
secure State Guarantees issued under this
Section as | ||||||
3 | provided in
Section 830-30 and Section 830-35 , respectively .
| ||||||
4 | (d) Notwithstanding the provisions of this
Section 830-45 | ||||||
5 | with respect to the
young farmers and lenders who may obtain | ||||||
6 | State Guarantees, the Authority may
promulgate rules | ||||||
7 | establishing the eligibility of young farmers and lenders to
| ||||||
8 | participate in the State Guarantee program and the terms, | ||||||
9 | standards, and
procedures that will apply, when the Authority | ||||||
10 | finds that emergency conditions
in Illinois agriculture have | ||||||
11 | created the need for State Guarantees pursuant to
terms, | ||||||
12 | standards, and procedures other than those specified in this
| ||||||
13 | Section.
| ||||||
14 | (Source: P.A. 93-205, eff. 1-1-04.)
| ||||||
15 | (20 ILCS 3501/830-50)
| ||||||
16 | Sec. 830-50. Specialized Livestock Guarantee Program.
| ||||||
17 | (a) The Authority is authorized to issue State Guarantees | ||||||
18 | to lenders for
loans
to finance or refinance debts for | ||||||
19 | specialized livestock operations that are or
will be located in | ||||||
20 | Illinois. For purposes of this
Section, a "specialized
| ||||||
21 | livestock operation" includes, but is not limited to, dairy, | ||||||
22 | beef, and swine
enterprises. For purposes of this Section, a | ||||||
23 | specialized livestock operation also includes livestock | ||||||
24 | operations using anaerobic digestors to generate electricity.
| ||||||
25 | (b) Lenders shall apply for the State Guarantees on forms |
| |||||||
| |||||||
1 | provided by the
Authority and certify that the application and | ||||||
2 | any other documents submitted
are true and correct. The lender | ||||||
3 | or borrower, or both in combination, shall pay
an | ||||||
4 | administrative fee as determined by the Authority. The | ||||||
5 | applicant shall be
responsible for paying any fee or charge | ||||||
6 | involved in recording mortgages,
releases, financing | ||||||
7 | statements, insurance for secondary market issues, and any
| ||||||
8 | other similar fee or charge that the Authority may require. The | ||||||
9 | application
shall, at a minimum, contain the farmer's name, | ||||||
10 | address, present credit and
financial information, including | ||||||
11 | cash flow statements, financial statements,
balance sheets, | ||||||
12 | and any other information pertinent to the application, and the
| ||||||
13 | collateral to be used to secure the State Guarantee. In | ||||||
14 | addition, the borrower
must certify to the Authority that, at | ||||||
15 | the time the State Guarantee is
provided,
the borrower will not | ||||||
16 | be delinquent in the repayment of any debt. The lender
must | ||||||
17 | agree to charge a fixed or adjustable interest rate that the | ||||||
18 | Authority
determines to be below the market rate of interest | ||||||
19 | generally available to the
borrower. If both the lender and | ||||||
20 | applicant agree, the interest rate on the
State guaranteed loan | ||||||
21 | can be converted to a fixed interest rate at any time
during | ||||||
22 | the term of the loan.
| ||||||
23 | (c) State Guarantees provided under this
Section (i) shall | ||||||
24 | not exceed
$1,000,000 per applicant, (ii) shall be no longer | ||||||
25 | than 15 years in duration,
and
(iii) shall be subject to an | ||||||
26 | annual review and renewal by the lender and the
Authority. An |
| |||||||
| |||||||
1 | applicant may use this program more than once, provided that | ||||||
2 | the
aggregate principal amount of State Guarantees under this
| ||||||
3 | Section to that
applicant does not exceed $1,000,000. A State | ||||||
4 | Guarantee shall not be revoked by
the Authority without a | ||||||
5 | 90-day notice, in writing, to all parties.
| ||||||
6 | (d) The Authority shall provide or renew a State Guarantee | ||||||
7 | to a lender if:
(i) The lender pays a fee equal to 25 basis | ||||||
8 | points on the loan to the Authority
on
an annual basis. (ii) | ||||||
9 | The application provides collateral acceptable to the
| ||||||
10 | Authority that is at least equal to the State Guarantee. (iii) | ||||||
11 | The lender
assumes all responsibility and costs for pursuing | ||||||
12 | legal action on collecting
any
loan that is delinquent or in | ||||||
13 | default. (iv) The lender is at risk for the first
15% of the | ||||||
14 | outstanding principal of the note for which the State Guarantee | ||||||
15 | is
provided.
| ||||||
16 | (e) The Illinois Agricultural Loan Guarantee Fund and the | ||||||
17 | Illinois Farmer and Agribusiness Loan Guarantee Fund may be | ||||||
18 | used to
secure State Guarantees issued under this
Section as | ||||||
19 | provided in
Section 830-30 and Section 830-35 , respectively .
| ||||||
20 | (f) Notwithstanding the provisions of this
Section 830-50 | ||||||
21 | with respect to the
specialized livestock operations and | ||||||
22 | lenders who may obtain State Guarantees,
the Authority may | ||||||
23 | promulgate rules establishing the eligibility of specialized
| ||||||
24 | livestock operations and lenders to participate in the State | ||||||
25 | Guarantee program
and the terms, standards, and procedures that | ||||||
26 | will apply, when the Authority
finds that emergency conditions |
| |||||||
| |||||||
1 | in Illinois agriculture have created the need
for State | ||||||
2 | Guarantees pursuant to terms, standards, and procedures other | ||||||
3 | than
those specified in this Section.
| ||||||
4 | (Source: P.A. 95-697, eff. 11-6-07.)
| ||||||
5 | (20 ILCS 3501/830-55 new) | ||||||
6 | Sec. 830-55. Working Capital Loan Guarantee Program. | ||||||
7 | (a) The Authority is authorized to issue State Guarantees | ||||||
8 | to lenders for loans to finance needed input costs related to | ||||||
9 | and in connection with planting and raising agricultural crops | ||||||
10 | and commodities in Illinois. Eligible input costs include, but | ||||||
11 | are not limited to, fertilizer, chemicals, feed, seed, fuel, | ||||||
12 | parts, and repairs. At the discretion of the Authority, the | ||||||
13 | farmer, producer, or agribusiness must be able to provide the | ||||||
14 | originating lender with a first lien on the proposed crop or | ||||||
15 | commodity to be raised and an assignment of Federal Crop | ||||||
16 | Insurance sufficient to secure the Working Capital Loan. | ||||||
17 | Additional collateral may be required as deemed necessary by | ||||||
18 | the lender and the Authority. | ||||||
19 | For the purposes of this Section, an eligible farmer, | ||||||
20 | producer, or agribusiness is a resident of Illinois who is at | ||||||
21 | least 18 years of age and who is a principal operator of a farm | ||||||
22 | or land, who derives at least 50% of annual gross income from | ||||||
23 | farming, and whose debt to asset ratio is not less than 40%. | ||||||
24 | For the purposes of this Section, debt to asset ratio means | ||||||
25 | current outstanding liabilities, including any debt to be |
| |||||||
| |||||||
1 | financed or refinanced under this Section 830-55, divided by | ||||||
2 | current outstanding assets. The Authority shall establish the | ||||||
3 | maximum permissible debt to asset ratio based on criteria | ||||||
4 | established by the Authority. Lenders shall apply for the State | ||||||
5 | Guarantees on forms provided by the Authority and certify that | ||||||
6 | the application and any other documents submitted are true and | ||||||
7 | correct. The lender or borrower, or both in combination, shall | ||||||
8 | pay an administrative fee as determined by the Authority. The | ||||||
9 | applicant shall be responsible for paying any fee or charge | ||||||
10 | involved in recording mortgages, releases, financing | ||||||
11 | statements, insurance for secondary market issues, and any | ||||||
12 | other similar fee or charge that the Authority may require. The | ||||||
13 | application shall at a minimum contain the borrower's name, | ||||||
14 | address, present credit and financial information, including | ||||||
15 | cash flow statements, financial statements, balance sheets, | ||||||
16 | and any other information pertinent to the application, and the | ||||||
17 | collateral to be used to secure the State Guarantee. In | ||||||
18 | addition, the borrower must certify to the Authority that, at | ||||||
19 | the time the State Guarantee is provided, the borrower will not | ||||||
20 | be delinquent in the repayment of any debt. The lender must | ||||||
21 | agree to charge a fixed or adjustable interest rate that the | ||||||
22 | Authority determines to be below the market rate of interest | ||||||
23 | generally available to the borrower. If both the lender and | ||||||
24 | applicant agree, the interest rate on the State guaranteed loan | ||||||
25 | can be converted to a fixed interest rate at any time during | ||||||
26 | the term of the loan. State Guarantees provided under this |
| |||||||
| |||||||
1 | Section (i) shall not exceed $250,000 per borrower, (ii) shall | ||||||
2 | be repaid annually, and (iii) shall be subject to an annual | ||||||
3 | review and renewal by the lender and the Authority. The State | ||||||
4 | Guarantee may be renewed annually, for a period not to exceed 3 | ||||||
5 | total years per State Guarantee, if the borrower meets | ||||||
6 | financial criteria and other conditions, as established by the | ||||||
7 | Authority. A farmer or agribusiness may use this program more | ||||||
8 | than once provided the aggregate principal amount of State | ||||||
9 | Guarantees under this Section to that farmer or agribusiness | ||||||
10 | does not exceed $250,000 annually. No State Guarantee shall be | ||||||
11 | revoked by the Authority without a 90-day notice, in writing, | ||||||
12 | to all parties. | ||||||
13 | (b) The Authority shall provide a State Guarantee to a | ||||||
14 | lender if: | ||||||
15 | (i) The borrower pays to the Authority a fee equal to | ||||||
16 | 100 basis points on the loan. | ||||||
17 | (ii) The application provides collateral acceptable to | ||||||
18 | the Authority that is at least equal to the State | ||||||
19 | Guarantee. | ||||||
20 | (iii) The lender assumes all responsibility and costs | ||||||
21 | for pursuing legal action on collecting any loan that is | ||||||
22 | delinquent or in default. | ||||||
23 | (iv) The lender is at risk for the first 15% of the | ||||||
24 | outstanding principal of the note for which the State | ||||||
25 | Guarantee is provided. | ||||||
26 | (c) The Illinois Agricultural Loan Guarantee Fund and the |
| |||||||
| |||||||
1 | Illinois Farmer and Agribusiness Loan Guarantee Fund may be | ||||||
2 | used to secure State Guarantees issued under this Section as | ||||||
3 | provided in Section 830-30 and Section 830-35, respectively. | ||||||
4 | (d) Notwithstanding the provisions of this Section 830-55 | ||||||
5 | with respect to the borrowers and lenders who may obtain State | ||||||
6 | Guarantees, the Authority may promulgate rules establishing | ||||||
7 | the eligibility of borrowers and lenders to participate in the | ||||||
8 | State Guarantee program and the terms, standards, and | ||||||
9 | procedures that will apply, when the Authority finds that | ||||||
10 | emergency conditions in Illinois agriculture have created the | ||||||
11 | need for State Guarantees pursuant to terms, standards, and | ||||||
12 | procedures other than those specified in this Section.
| ||||||
13 | Section 99. Effective date. This Act takes effect upon | ||||||
14 | becoming law.
|