Illinois General Assembly - Full Text of HB4972
Illinois General Assembly

  Bills & Resolutions  
  Compiled Statutes  
  Public Acts  
  Legislative Reports  
  IL Constitution  
  Legislative Guide  
  Legislative Glossary  

 Search By Number
 (example: HB0001)
Search Tips

Search By Keyword

Full Text of HB4972  102nd General Assembly

HB4972 102ND GENERAL ASSEMBLY

  
  

 


 
102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB4972

 

Introduced 1/27/2022, by Rep. Eva Dina Delgado

 

SYNOPSIS AS INTRODUCED:
 
15 ILCS 505/20
15 ILCS 505/40 new
30 ILCS 500/30-60 new
215 ILCS 155/17  from Ch. 73, par. 1417

    Amends the State Treasurer Act. Provides that administrative charges from the investment or safekeeping of funds by the State Treasurer shall be charged no more than monthly and the total amount charged per fiscal year shall not exceed $14,500,000 (currently, $12,000,000) plus any amounts required as employer contributions. Provides that the State Treasurer may invest in a commercial note from a State vendor in the amount of 50% to 100% of any invoice to be paid by the Capital Development Board or a pay item with the Department of Transportation for work already completed. Provides further requirements concerning State Treasurer commercial note investment. Amends the Illinois Procurement Code. Provides that all construction contracts with the State for which the State Treasurer invests a commercial note shall require the prime contractor to designate an independent escrowee operating as a construction disbursement provider to receive funds directly from the Comptroller and that the construction disbursement provider shall provide a certified copy of each disbursement record to the contracting State agency. Amends the Title Insurance Act. In provisions concerning independent escrowees, provides that an independent escrowee may operate as a construction disbursement provider. Provides further requirements for independent escrowees that operate as a construction disbursement provider. Provides that an individual receiving wages or payment for labor under a disbursement shall be individually recorded to ensure all wages are paid.


LRB102 24152 RJF 33378 b

 

 

A BILL FOR

 

HB4972LRB102 24152 RJF 33378 b

1    AN ACT concerning finance.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. This Act may be referred to as the Financing
5Vendor Business Growth Correctly Act.
 
6    Section 5. The State Treasurer Act is amended by changing
7Section 20 and by adding Section 40 as follows:
 
8    (15 ILCS 505/20)
9    Sec. 20. State Treasurer administrative charge. The State
10Treasurer may retain an administrative charge for both the
11costs of services associated with the deposit of moneys that
12are remitted directly to the State Treasurer and the
13investment or safekeeping of funds by the State Treasurer. The
14administrative charges collected under this Section shall be
15deposited into the State Treasurer's Administrative Fund. The
16amount of the administrative charges may be determined by the
17State Treasurer. Administrative charges from the deposit of
18moneys remitted directly to the State Treasurer shall not
19exceed 2% of the amount deposited. Administrative charges from
20the investment or safekeeping of funds by the State Treasurer
21shall be charged no more than monthly and the total amount
22charged per fiscal year shall not exceed $14,500,000

 

 

HB4972- 2 -LRB102 24152 RJF 33378 b

1$12,000,000 plus any amounts required as employer
2contributions under Section 14-131 of the Illinois Pension
3Code and Section 10 of the State Employees Group Insurance Act
4of 1971.
5    Administrative charges for the deposit of moneys shall
6apply to fines, fees, or other amounts remitted directly to
7the State Treasurer by circuit clerks, county clerks, and
8other entities for deposit into a fund in the State treasury.
9Administrative charges for the deposit of moneys do not apply
10to amounts remitted by State agencies or certified collection
11specialists as defined in 74 Ill. Admin. Code 1200.50.
12Administrative charges for the deposit of moneys shall apply
13only to any form of fines, fees, or other collections created
14on or after August 15, 2014 (the effective date of Public Act
1598-965).
16    Moneys in the State Treasurer's Administrative Fund are
17subject to appropriation by the General Assembly.
18(Source: P.A. 100-587, eff. 6-4-18.)
 
19    (15 ILCS 505/40 new)
20    Sec. 40. State Treasurer commercial note investment. The
21State Treasurer may invest in a commercial note from a State
22vendor in the amount of 50% to 100% of any invoice to be paid
23by the Capital Development Board or a pay item with the
24Department of Transportation for work already completed. The
25commercial note shall be either the actual invoice approved by

 

 

HB4972- 3 -LRB102 24152 RJF 33378 b

1the project architect and submitted to the Capital Development
2Board or the pay item submitted and approved by a resident
3engineer of the Department of Transportation, or a copy
4thereof. The State Treasurer may require proof of work
5completed or other documentation. The State Treasurer may
6invest in the commercial note and collect interest and
7administrative fees pursuant to Section 20. If any amount is
8deducted from payments made by the State with respect to any
9commercial note investment under this Section due to the
10State's exercise of any offset or other contractual rights
11against a State vendor, including statutorily required
12administrative fees imposed pursuant to the State Comptroller
13Act, the State vendor shall still be required to pay the
14commercial note in full to the State Treasurer. The State
15Treasurer may retain any third-party to carry out the terms of
16this Section. The State vendor must comply with the terms of
17the commercial note investment and assign rights to payment
18from the Capital Development Board or Department of
19Transportation to the Treasurer or third-party retained by the
20Treasurer. The interest and fees shall be set by the State
21Treasurer. Commercial note investments shall be public records
22and the State Treasurer shall post the terms on the State
23Treasurer's official website.
24    The State Treasurer may terminate immediately any
25commercial note investment made under this Section if the
26Capital Development Board or the Department of Transportation

 

 

HB4972- 4 -LRB102 24152 RJF 33378 b

1determine that the State vendor has not complied with the
2terms of its contract. Upon termination of a commercial note
3investment, the State vendor must immediately repay the
4commercial note investment, with any interest earned.
5    Actions taken pursuant to this Section shall not
6constitute government knowledge or acceptance of any conduct,
7and shall not limit the rights and remedies provided for under
8the Illinois False Claims Act or the federal False Claims Act.
 
9    Section 10. The Illinois Procurement Code is amended by
10adding Section 30-60 as follows:
 
11    (30 ILCS 500/30-60 new)
12    Sec. 30-60. Construction disbursement provider.
13    (a) All construction contracts with this State entered
14into after the effective date of this amendatory Act of the
15102nd General Assembly shall require the prime contractor to
16designate an independent escrowee operating as a construction
17disbursement provider under subsection (i) of Section 17 of
18the Title Insurance Act to receive funds directly from the
19Comptroller.
20    (b) The construction disbursement provider shall provide a
21certified copy of each disbursement record to the contracting
22State agency.
23    (c) The requirements of this Section shall only apply to
24State construction contracts in which the State Treasurer

 

 

HB4972- 5 -LRB102 24152 RJF 33378 b

1invests a commercial note as provided under Section 40 of the
2State Treasurer Act.
 
3    Section 15. The Title Insurance Act is amended by changing
4Section 17 as follows:
 
5    (215 ILCS 155/17)  (from Ch. 73, par. 1417)
6    Sec. 17. Independent escrowees.
7    (a) Every independent escrowee shall be subject to the
8same certification and deposit requirements to which title
9insurance companies are subject under Section 4 of this Act.
10    (b) No person, firm, corporation or other legal entity
11shall hold itself out to be an independent escrowee unless it
12has been issued a certificate of authority by the Secretary.
13    (c) Every applicant for a certificate of authority, except
14a firm, partnership, association or corporation, must be 18
15years or more of age.
16    (d) Every certificate of authority shall remain in effect
17one year unless revoked or suspended by the Secretary or
18voluntarily surrendered by the holder.
19    (e) An independent escrowee may engage in the escrow,
20settlement, or closing business, or any combination of such
21business, and operate as an escrow, settlement, or closing
22agent, provided that:
23        (1) Funds deposited in connection with any escrow,
24    settlement, or closing shall be deposited in a separate

 

 

HB4972- 6 -LRB102 24152 RJF 33378 b

1    fiduciary trust account or accounts in a bank or other
2    financial institution insured by an agency of the federal
3    government unless the instructions provide otherwise. Such
4    funds shall be the property of the person or persons
5    entitled thereto under the provisions of the escrow,
6    settlement, or closing and shall be segregated by escrow,
7    settlement or closing in the records of the independent
8    escrowee. Such funds shall not be subject to any debts of
9    the escrowee and shall be used only in accordance with the
10    terms of the individual escrow, settlement or closing
11    under which the funds were accepted.
12        (2) Interest received on funds deposited with the
13    independent escrowee in connection with any escrow,
14    settlement or closing shall be paid to the depositing
15    party unless the instructions provide otherwise.
16        (3) The independent escrowee shall maintain separate
17    records of all receipt and disbursement of escrow,
18    settlement or closing funds.
19        (4) The independent escrowee shall comply with any
20    rules or regulations promulgated by the Secretary
21    pertaining to escrow, settlement or closing transactions.
22    (f) The Secretary or his authorized representative shall
23have the power and authority to visit and examine at any time
24any independent escrowee certified under this Act and to
25verify and compel compliance with the provisions of this Act.
26    (g) A title insurance company or title insurance agent,

 

 

HB4972- 7 -LRB102 24152 RJF 33378 b

1not qualified as an independent escrowee, may act in the
2capacity of an escrow agent when it is supplying an abstract of
3title, grantor-grantee search, tract search, lien search, tax
4assessment search, or other limited purpose search to the
5parties to the transaction even if it is not issuing a title
6insurance commitment or title insurance policy. A title
7insurance agent may act as an escrow agent only when
8specifically authorized in writing on forms prescribed by the
9Secretary by a title insurance company that has duly
10registered the agent with the Secretary and only when notice
11of the authorization is provided to and receipt thereof is
12acknowledged by the Secretary. The authority granted to a
13title insurance agent may be limited or revoked at any time by
14the title insurance company.
15    (h) An independent escrowee may, pursuant to Section 17.1
16of this Act, issue an insured closing letter if, in addition to
17complying with the same certification and deposit requirements
18that title insurance companies are subject to under Section 4
19of this Act, the independent escrowee:
20        (1) Satisfies the Secretary that it has a minimum
21    capital and surplus of $2,000,000. The Secretary may
22    provide the forms and standards for this purpose by rule.
23    This paragraph applies only to independent escrowees
24    licensed under this Act for the first time on or after the
25    effective date of this amendatory Act of the 100th General
26    Assembly.

 

 

HB4972- 8 -LRB102 24152 RJF 33378 b

1        (2) Files with and has approved by the Secretary proof
2    of a fidelity bond in the minimum amount of $2,000,000 per
3    occurrence.
4        (3) Establishes and maintains a statutory closing
5    protection letter reserve for the protection of parties
6    named in warranties of services consisting of a sum of 25%
7    of the closing protection letter revenue received by the
8    independent escrowee on or after the effective date of
9    this amendatory Act of the 100th General Assembly. The
10    reserve shall be reported as a liability of the
11    independent escrowee in its financial statements. Amounts
12    placed in the statutory closing protection letter reserve
13    shall be deducted in determining the net profit of the
14    independent escrowee for the year. Except as provided in
15    this subsection, assets in value equal to the statutory
16    closing protection letter reserve are not subject to
17    distribution among creditors, stockholders, or other
18    owners of the independent escrowee until all claims of
19    parties named in warranties of services have been paid in
20    full and discharged.
21        (4) Releases from the statutory closing protection
22    letter reserve a sum equal to 10% of the amount added to
23    the reserve during a calendar year on July 1 of each of the
24    5 years following the year in which the sum was added and
25    releases from the statutory closing protection letter
26    reserve a sum equal to 3 1/3% of the amount added to the

 

 

HB4972- 9 -LRB102 24152 RJF 33378 b

1    reserve during that year on each succeeding July 1 until
2    the entire amount for that year has been released.
3    The Secretary shall adopt and amend rules as may be
4required for the proper administration and enforcement of this
5subsection (h) consistent with the federal Real Estate
6Settlement and Procedures Act and Section 24 of this Act.
7    (i) An independent escrowee may operate as a construction
8disbursement provider. An independent escrowee that operates
9as a construction disbursement provider shall certify that all
10funds distributed to and from the independent escrowee have
11been in fact received and distributed to the proper parties,
12including all subcontractors, suppliers, and employees or
13independent contractors who perform labor for any contractor
14who received funds from a disbursement. An independent
15escrowee that operates as a construction disbursement provider
16shall maintain a record of every disbursement with proof that
17the funds were disbursed to accounts controlled by a party
18entitled to funds from a disbursement. An individual receiving
19wages or payment for labor under a disbursement shall be
20individually recorded to ensure all wages are paid. All funds
21shall be distributed to all parties on the same day payment is
22received by the independent escrowee operating as a
23construction disbursement provider. An independent escrowee
24operating as a construction disbursement provider shall issue
25a certified disbursement record for every disbursement that
26includes all payments received and made.

 

 

HB4972- 10 -LRB102 24152 RJF 33378 b

1(Source: P.A. 100-485, eff. 9-8-17.)