Full Text of SB0324 099th General Assembly
SB0324enr 99TH GENERAL ASSEMBLY |
| | SB0324 Enrolled | | LRB099 02938 JLK 22946 b |
|
| 1 | | AN ACT concerning government.
| 2 | | Be it enacted by the People of the State of Illinois, | 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Finance Authority Act is amended by | 5 | | changing Sections 805-20, 830-30, 830-35, 830-45, and 830-55 | 6 | | and by adding Article 835 as follows:
| 7 | | (20 ILCS 3501/805-20)
| 8 | | Sec. 805-20. Powers and Duties; Industrial Project | 9 | | Insurance Program. The
Authority has the power:
| 10 | | (a) to insure and make advance commitments to insure all or | 11 | | any part of the
payments required on the bonds issued or a loan | 12 | | made to finance any
environmental facility under the Illinois | 13 | | Environmental Facilities Financing
Act
or for any industrial | 14 | | project upon such terms and conditions as the Authority
may | 15 | | prescribe in accordance with
this Article. The
insurance | 16 | | provided by the Authority shall be payable solely from the Fund
| 17 | | created by
Section 805-15 and shall not constitute a debt or | 18 | | pledge of the full
faith and credit of the State, the | 19 | | Authority, or any political subdivision
thereof;
| 20 | | (b) to enter into insurance contracts, letters of credit or | 21 | | any other
agreements or contracts with financial institutions | 22 | | with respect to the Fund
and
any bonds or loans insured | 23 | | thereunder. Any such agreement or contract may
contain terms |
| | | SB0324 Enrolled | - 2 - | LRB099 02938 JLK 22946 b |
|
| 1 | | and provisions necessary or desirable in connection with the
| 2 | | program, subject to the requirements established by this Act, | 3 | | including without
limitation terms and provisions relating to | 4 | | loan documentation, review and
approval procedures, | 5 | | origination and servicing rights and responsibilities,
default | 6 | | conditions, procedures and obligations with respect to | 7 | | insurance
contracts made under this Act. The agreements or | 8 | | contracts may be executed on
an individual, group or master | 9 | | contract basis with financial institutions;
| 10 | | (c) to charge reasonable fees to defray the cost of | 11 | | obtaining letters of
credit
or other similar documents, other | 12 | | than insurance contracts under paragraph (b).
Any such fees | 13 | | shall be payable by such person, in such amounts and at such
| 14 | | times
as the Authority shall determine, and the amount of the | 15 | | fees need not be
uniform
among the various bonds or loans | 16 | | insured;
| 17 | | (d) to fix insurance premiums for the insurance of payments | 18 | | under the
provisions of
this Article. Such premiums shall be
| 19 | | computed as determined by the Authority. Any premiums for the | 20 | | insurance of loan
payments under the provisions of this Act | 21 | | shall be payable by such person, in
such amounts and at such | 22 | | times as the Authority shall determine, and the amount
of the | 23 | | premiums need not be uniform among the various bonds or loans | 24 | | insured;
| 25 | | (e) to establish application fees and prescribe | 26 | | application, notification,
contract and insurance forms, rules |
| | | SB0324 Enrolled | - 3 - | LRB099 02938 JLK 22946 b |
|
| 1 | | and regulations it deems necessary or
appropriate;
| 2 | | (f) to make loans and to issue bonds secured by insurance | 3 | | or other
agreements
authorized by paragraphs (a) and (b) of | 4 | | this
Section 805-20 and to issue bonds
secured by loans that | 5 | | are guaranteed by the federal government or agencies
thereof;
| 6 | | (g) to issue a single bond issue, or a series of bond | 7 | | issues, for a group of
industrial projects, a group of | 8 | | corporations, or a group of business entities
or
any | 9 | | combination thereof insured by insurance or backed by any other | 10 | | agreement
authorized by paragraphs (a) and (b) of this
Section | 11 | | or secured by loans that
are guaranteed by the federal | 12 | | government or agencies thereof;
| 13 | | (h) to enter into trust agreements for the management of | 14 | | the Fund created
under Section 805-15 of this Act;
| 15 | | (i) to exercise such other powers as are necessary or | 16 | | incidental to the powers granted in this Section and to the | 17 | | issuance of State Guarantees under Article 830 of this Act; and
| 18 | | (j) at the discretion of the Authority, to insure and make | 19 | | advance commitments to insure, and issue State Guarantees for, | 20 | | all or any part of the payments required on the bonds issued or | 21 | | loans made to finance any agricultural facility, project, | 22 | | farmer, producer, agribusiness, qualified veteran-owned small | 23 | | business, or program under Article 830 or Article 835 of this | 24 | | Act upon such terms and conditions as the Authority may | 25 | | prescribe in accordance with this Article. The insurance and | 26 | | State Guarantees provided by the Authority may be payable from |
| | | SB0324 Enrolled | - 4 - | LRB099 02938 JLK 22946 b |
|
| 1 | | the Fund created by Section 805-15 and is in addition to and | 2 | | not in replacement of the Illinois Agricultural Loan Guarantee | 3 | | Fund and the Illinois Farmer and Agribusiness Loan Guarantee | 4 | | Fund created under Article 830 of this Act. | 5 | | (Source: P.A. 96-897, eff. 5-24-10; 97-333, eff. 8-12-11.)
| 6 | | (20 ILCS 3501/830-30)
| 7 | | Sec. 830-30. State Guarantees for existing debt.
| 8 | | (a) The Authority is authorized to issue State Guarantees | 9 | | for farmers'
existing
debts held by a lender. For the purposes | 10 | | of this
Section, a farmer shall be a
resident of Illinois, who | 11 | | is a principal operator of a farm or land, at least
50% of | 12 | | whose annual gross income is derived from farming and whose | 13 | | debt to
asset
ratio shall not be less than 40%, except in those | 14 | | cases where the applicant has
previously used the guarantee | 15 | | program there shall be no debt to asset ratio or
income | 16 | | restriction. For the purposes of this
Section, debt to asset | 17 | | ratio shall
mean the current outstanding liabilities of the | 18 | | farmer divided by the current
outstanding assets of the farmer. | 19 | | The Authority shall establish the maximum
permissible debt to | 20 | | asset ratio based on criteria established by the Authority.
| 21 | | Lenders shall apply for the State Guarantees on forms provided | 22 | | by the Authority
and certify that the application and any other | 23 | | documents submitted are true and
correct. The lender or | 24 | | borrower, or both in combination, shall pay an
administrative | 25 | | fee as determined by the Authority. The applicant shall be
|
| | | SB0324 Enrolled | - 5 - | LRB099 02938 JLK 22946 b |
|
| 1 | | responsible for paying any fees or charges involved in | 2 | | recording mortgages,
releases, financing statements, insurance | 3 | | for secondary market issues and any
other similar fees or | 4 | | charges as the Authority may require. The application
shall at | 5 | | a minimum contain the farmer's name, address, present credit | 6 | | and
financial information, including cash flow statements, | 7 | | financial statements,
balance sheets, and any other | 8 | | information pertinent to the application, and the
collateral to | 9 | | be used to secure the State Guarantee. In addition, the lender
| 10 | | must agree to bring the farmer's debt to a current status at | 11 | | the time the State
Guarantee is provided and must also agree to | 12 | | charge a fixed or adjustable
interest rate which the Authority | 13 | | determines to be below the market rate of
interest generally | 14 | | available to the borrower. If both the lender and applicant
| 15 | | agree, the interest rate on the State Guarantee Loan can be | 16 | | converted to a fixed
interest rate at any time during the term | 17 | | of the loan.
Any State Guarantees provided under this
Section | 18 | | (i) shall not exceed $500,000
per farmer, (ii) shall be set up | 19 | | on a payment schedule not to exceed 30 years,
and shall be no | 20 | | longer than 30 years in duration, and (iii) shall be subject to
| 21 | | an annual review and renewal by the lender and the Authority; | 22 | | provided that
only
one such State Guarantee shall be | 23 | | outstanding per farmer at any one time. No
State Guarantee | 24 | | shall be revoked by the Authority without a 90-day notice, in
| 25 | | writing, to all parties. In those cases where the borrower has | 26 | | not previously
used the guarantee program, the lender shall not |
| | | SB0324 Enrolled | - 6 - | LRB099 02938 JLK 22946 b |
|
| 1 | | call due any loan during the
first 3 years for any reason | 2 | | except for lack of performance or insufficient
collateral. The | 3 | | lender can review and withdraw or continue with the State
| 4 | | Guarantee on an annual basis after the first 3 years of the | 5 | | loan, provided a
90-day notice, in writing, to all parties has | 6 | | been given.
| 7 | | (b) The Authority shall provide or renew a State Guarantee | 8 | | to a lender if:
| 9 | | (i) A fee equal to 25 basis points on the loan is paid | 10 | | to the Authority on
an
annual
basis by the lender.
| 11 | | (ii) The application provides collateral acceptable to | 12 | | the
Authority that is at least equal to the State's portion | 13 | | of the Guarantee to be
provided.
| 14 | | (iii) The lender assumes all responsibility and costs | 15 | | for pursuing
legal action on collecting any loan that is | 16 | | delinquent or in default.
| 17 | | (iv) The
lender is responsible for the first 15% of the | 18 | | outstanding principal of the
note
for which the State | 19 | | Guarantee has been applied.
| 20 | | (c) There is hereby created outside of the State treasury a | 21 | | special fund to
be
known as the Illinois Agricultural Loan | 22 | | Guarantee Fund. The State Treasurer
shall be custodian of this | 23 | | Fund. Any amounts in the Illinois Agricultural Loan
Guarantee | 24 | | Fund not currently needed to meet the obligations of the Fund | 25 | | shall
be
invested as provided by law, and all interest earned | 26 | | from these investments
shall be deposited into the Fund until |
| | | SB0324 Enrolled | - 7 - | LRB099 02938 JLK 22946 b |
|
| 1 | | the Fund reaches the maximum amount
authorized in this Act; | 2 | | thereafter, interest earned shall be deposited into the
General | 3 | | Revenue Fund. After September 1, 1989, annual investment | 4 | | earnings equal
to 1.5% of the Fund shall remain in the Fund to | 5 | | be used for the purposes
established in
Section 830-40 of this | 6 | | Act. The Authority is authorized to
transfer to the Fund such | 7 | | amounts as are necessary to satisfy claims during the
duration | 8 | | of the State Guarantee program to secure State Guarantees | 9 | | issued under
this
Section , provided that amounts to be paid | 10 | | from the Industrial Project Insurance Fund created under | 11 | | Article 805 of this Act may be paid by the Authority directly | 12 | | to satisfy claims and need not
be deposited first into the | 13 | | Illinois Agricultural Loan Guarantee Fund . If for any reason | 14 | | the General Assembly fails to make an
appropriation sufficient | 15 | | to meet these obligations, this Act shall constitute
an
| 16 | | irrevocable and continuing appropriation of an amount | 17 | | necessary to secure
guarantees as defaults occur and the | 18 | | irrevocable and continuing authority for,
and direction to, the | 19 | | State Treasurer and the Comptroller to make the necessary
| 20 | | transfers to the Illinois Agricultural Loan Guarantee Fund, as | 21 | | directed by the
Governor, out of the General Revenue Fund. | 22 | | Within 30 days after November 15,
1985, the Authority may | 23 | | transfer up to $7,000,000 from available appropriations
into | 24 | | the Illinois Agricultural Loan Guarantee Fund for the purposes | 25 | | of this
Act.
Thereafter, the Authority may transfer additional | 26 | | amounts into the Illinois
Agricultural Loan Guarantee Fund to |
| | | SB0324 Enrolled | - 8 - | LRB099 02938 JLK 22946 b |
|
| 1 | | secure guarantees for defaults as defaults
occur. In the event | 2 | | of default by the farmer, the lender shall be entitled to,
and | 3 | | the Authority shall direct payment on, the State Guarantee | 4 | | after 90 days of
delinquency. All payments by the Authority | 5 | | shall be made from the Illinois
Agricultural Loan Guarantee | 6 | | Fund to satisfy claims against the State Guarantee shall be | 7 | | made, in whole or in part, from any of the following funds in | 8 | | such order and in such amounts as the Authority shall | 9 | | determine: (1) the Industrial Project Insurance Fund created | 10 | | under Article 805 of this Act (if the Authority exercises its | 11 | | discretion under subsection (j) of Section 805-20); (2) the | 12 | | Illinois Agricultural Loan Guarantee Fund; or (3) the Illinois | 13 | | Farmer and Agribusiness Loan Guarantee Fund .
The Illinois | 14 | | Agricultural Loan Guarantee Fund shall guarantee receipt of | 15 | | payment
of the 85% of the principal and interest owed on the | 16 | | State Guarantee Loan by the
farmer to the guarantee holder , | 17 | | provided that payments by the Authority to satisfy claims | 18 | | against the State Guarantee shall be made in accordance with | 19 | | the preceding sentence . It shall be the responsibility of the | 20 | | lender to
proceed with the collecting and disposing of | 21 | | collateral on the State Guarantee under this Section, Section | 22 | | 830-35, Section 830-45, Section 830-50, Section 830-55, or | 23 | | Article 835
within 14 months of the time the State Guarantee is | 24 | | declared delinquent;
provided, however, that the lender shall | 25 | | not collect or dispose of collateral on
the State Guarantee | 26 | | without the express written prior approval of the Authority.
If |
| | | SB0324 Enrolled | - 9 - | LRB099 02938 JLK 22946 b |
|
| 1 | | the lender does not dispose of the collateral within 14 months, | 2 | | the lender
shall be liable to repay to the State interest on | 3 | | the State Guarantee equal to
the same rate which the lender | 4 | | charges on the State Guarantee; provided,
however, that the | 5 | | Authority may extend the 14-month period for a lender in the
| 6 | | case of bankruptcy or extenuating circumstances. The Fund from | 7 | | which a payment is made shall be reimbursed
for any amounts | 8 | | paid from that Fund under this
Section , Section 830-35, Section | 9 | | 830-45, Section 830-50, Section 830-55, or Article 835 upon | 10 | | liquidation of the collateral. The
Authority, by resolution of | 11 | | the Board, may borrow sums from the Fund and
provide
for | 12 | | repayment as soon as may be practical upon receipt of payments | 13 | | of principal
and interest by a farmer. Money may be borrowed | 14 | | from the Fund by the Authority
for the sole purpose of paying | 15 | | certain interest costs for farmers associated
with selling a | 16 | | loan subject to a State Guarantee in a secondary market as may
| 17 | | be
deemed reasonable and necessary by the Authority.
| 18 | | (d) Notwithstanding the provisions of this
Section 830-30 | 19 | | with respect to the
farmers and lenders who may obtain State | 20 | | Guarantees, the Authority may
promulgate rules establishing | 21 | | the eligibility of farmers and lenders to
participate in the | 22 | | State guarantee program and the terms, standards, and
| 23 | | procedures that will apply, when the Authority finds that | 24 | | emergency conditions
in Illinois agriculture have created the | 25 | | need for State Guarantees pursuant to
terms, standards, and | 26 | | procedures other than those specified in this
Section.
|
| | | SB0324 Enrolled | - 10 - | LRB099 02938 JLK 22946 b |
|
| 1 | | (Source: P.A. 93-205, eff. 1-1-04.)
| 2 | | (20 ILCS 3501/830-35)
| 3 | | Sec. 830-35. State Guarantees for loans to farmers and | 4 | | agribusiness;
eligibility. | 5 | | (a) The Authority is authorized to issue State Guarantees | 6 | | to lenders for
loans
to eligible farmers and agribusinesses for | 7 | | purposes set forth in this
Section.
For purposes of this
| 8 | | Section, an eligible farmer shall be a resident of Illinois
(i) | 9 | | who is principal operator of a farm or land, at least 50% of | 10 | | whose annual
gross income is derived from farming, (ii) whose | 11 | | annual total sales of
agricultural products, commodities, or | 12 | | livestock exceeds $20,000, and (iii)
whose net worth does not | 13 | | exceed $500,000. An eligible agribusiness shall be
that as | 14 | | defined in
Section 801-10 of this Act.
The Authority may | 15 | | approve applications by farmers and agribusinesses that
| 16 | | promote diversification of the farm economy of this State | 17 | | through the growth
and
development of new crops or livestock | 18 | | not customarily grown or produced in this
State or that | 19 | | emphasize a vertical integration of grain or livestock produced
| 20 | | or
raised in this State into a finished agricultural product | 21 | | for consumption or
use. "New crops or livestock not customarily | 22 | | grown or produced in this State"
shall not include corn, | 23 | | soybeans, wheat, swine, or beef or dairy cattle.
"Vertical | 24 | | integration of grain or livestock produced or raised in this | 25 | | State"
shall include any new or existing grain or livestock |
| | | SB0324 Enrolled | - 11 - | LRB099 02938 JLK 22946 b |
|
| 1 | | grown or produced in this
State.
Lenders shall apply for the | 2 | | State Guarantees on forms provided by the
Authority,
certify | 3 | | that the application and any other documents submitted are true | 4 | | and
correct, and pay an administrative fee as determined by the | 5 | | Authority. The
applicant shall be responsible for paying any | 6 | | fees or charges involved in
recording mortgages, releases, | 7 | | financing statements, insurance for secondary
market issues | 8 | | and any other similar fees or charges as the Authority may
| 9 | | require. The application shall at a minimum contain the | 10 | | farmer's or
agribusiness' name, address, present credit and | 11 | | financial information,
including cash flow statements, | 12 | | financial statements, balance sheets, and any
other
| 13 | | information pertinent to the application, and the collateral to | 14 | | be used to
secure the State Guarantee. In addition, the lender | 15 | | must agree to charge an
interest rate, which may vary, on the | 16 | | loan that the Authority determines to be
below the market rate | 17 | | of interest generally available to the borrower. If both
the | 18 | | lender and applicant agree, the interest rate on the State | 19 | | Guarantee Loan
can be converted to a fixed interest rate at any | 20 | | time during the term of the
loan.
Any State Guarantees provided | 21 | | under this
Section (i) shall not exceed $500,000
per farmer or | 22 | | an amount as determined by the Authority on a case-by-case
| 23 | | basis for an agribusiness, (ii) shall not exceed a term of 15 | 24 | | years, and (iii)
shall be subject to an annual review and | 25 | | renewal by the lender and the
Authority; provided that only one | 26 | | such State Guarantee shall be made per farmer
or agribusiness, |
| | | SB0324 Enrolled | - 12 - | LRB099 02938 JLK 22946 b |
|
| 1 | | except that additional State Guarantees may be made for
| 2 | | purposes of expansion of projects financed in part by a | 3 | | previously issued State
Guarantee. No State Guarantee shall be | 4 | | revoked by the Authority without a
90-day notice, in writing, | 5 | | to all parties. The lender shall not call due any
loan
for any | 6 | | reason except for lack of performance, insufficient | 7 | | collateral, or
maturity. A lender may review and withdraw or | 8 | | continue with a State Guarantee
on an annual basis after the | 9 | | first 5 years following closing of the loan
application if the | 10 | | loan contract provides for an interest rate that shall not
| 11 | | vary. A lender shall not withdraw a State Guarantee if the loan | 12 | | contract
provides for an interest rate that may vary, except | 13 | | for reasons set forth
herein.
| 14 | | (b) The Authority shall provide or renew a State Guarantee | 15 | | to a lender if:
| 16 | | (i) A fee equal to 25 basis points on the loan is paid | 17 | | to the Authority on
an annual
basis by the lender.
| 18 | | (ii) The application provides collateral acceptable to | 19 | | the
Authority that is at least equal to the State's portion | 20 | | of the Guarantee to be
provided.
| 21 | | (iii) The lender assumes all responsibility and costs | 22 | | for pursuing
legal action on collecting any loan that is | 23 | | delinquent or in default.
| 24 | | (iv) The
lender is responsible for the first 15% of the | 25 | | outstanding principal of the
note
for which the State | 26 | | Guarantee has been applied.
|
| | | SB0324 Enrolled | - 13 - | LRB099 02938 JLK 22946 b |
|
| 1 | | (c) There is hereby created outside of the State treasury a | 2 | | special fund to
be
known as the Illinois Farmer and | 3 | | Agribusiness Loan Guarantee Fund. The State
Treasurer shall be | 4 | | custodian of this Fund. Any amounts in the Fund not
currently | 5 | | needed to meet the obligations of the Fund shall be invested as
| 6 | | provided by law, and all interest earned from these investments | 7 | | shall be
deposited into the Fund until the Fund reaches the | 8 | | maximum amounts authorized
in
this Act; thereafter, interest | 9 | | earned shall be deposited into the General
Revenue Fund. After | 10 | | September 1, 1989, annual investment earnings equal to 1.5%
of | 11 | | the Fund shall remain in the Fund to be used for the purposes | 12 | | established in
Section 830-40 of this Act. The Authority is | 13 | | authorized to transfer such
amounts
as are necessary to satisfy | 14 | | claims from available appropriations and from fund
balances of | 15 | | the Farm Emergency Assistance Fund as of June 30 of each year | 16 | | to
the
Illinois Farmer and Agribusiness Loan Guarantee Fund to | 17 | | secure State Guarantees
issued under this
Section , and
Sections | 18 | | 830-30, 830-45, 830-50, and 830-55 , and Article 835 of this | 19 | | Act. Amounts to be paid from the Industrial Project Insurance | 20 | | Fund created under Article 805 of this Act may be paid by the | 21 | | Authority directly to satisfy claims and need not be deposited | 22 | | first into the Illinois Farmer and Agribusiness Loan Guarantee | 23 | | Fund . If for any reason the
General Assembly fails to make an | 24 | | appropriation sufficient to meet these
obligations, this Act | 25 | | shall constitute an irrevocable and continuing
appropriation | 26 | | of an amount necessary to secure guarantees as defaults occur |
| | | SB0324 Enrolled | - 14 - | LRB099 02938 JLK 22946 b |
|
| 1 | | and
the irrevocable and continuing authority for, and direction | 2 | | to, the State
Treasurer and the Comptroller to make the | 3 | | necessary transfers to the Illinois
Farmer and Agribusiness | 4 | | Loan Guarantee Fund, as directed by the Governor, out
of
the | 5 | | General Revenue Fund. In the event of default by the borrower | 6 | | on State
Guarantee Loans under this
Section,
Section 830-45,
| 7 | | Section 830-50, or Section 830-55, the lender
shall be entitled | 8 | | to, and the Authority shall direct payment on, the State
| 9 | | Guarantee after 90 days of delinquency. All payments by the | 10 | | Authority shall be
made from the Illinois Farmer and | 11 | | Agribusiness Loan Guarantee Fund to satisfy
claims against the | 12 | | State Guarantee shall be made, in whole or in part, from any of | 13 | | the following funds in such order and in such amounts as the | 14 | | Authority shall determine: (1) the Industrial Project | 15 | | Insurance Fund created under Article 805 of this Act (if the | 16 | | Authority exercises its discretion under subsection (j) of | 17 | | Section 805-20); (2) the Illinois Farmer and Agribusiness Loan | 18 | | Guarantee Fund; or (3) the Illinois Farmer and Agribusiness | 19 | | Loan Guarantee Fund . It shall be the responsibility of the
| 20 | | lender to proceed with the collecting and disposing of | 21 | | collateral on the State
Guarantee under this
Section,
Section | 22 | | 830-45,
Section 830-50, or Section 830-55 within 14 months of
| 23 | | the time the State Guarantee is declared delinquent. If the | 24 | | lender does not
dispose of the collateral within 14 months, the | 25 | | lender shall be liable to repay
to the State interest on the | 26 | | State Guarantee equal to the same rate that the
lender charges |
| | | SB0324 Enrolled | - 15 - | LRB099 02938 JLK 22946 b |
|
| 1 | | on the State Guarantee, provided that the Authority shall have
| 2 | | the authority to extend the 14-month period for a lender in the | 3 | | case of
bankruptcy or extenuating circumstances. The Fund shall | 4 | | be reimbursed for any
amounts paid under this
Section, Section | 5 | | 830-30,
Section 830-45,
Section 830-50, or Section 830-55 , or | 6 | | Article 835 upon liquidation
of the collateral.
The Authority, | 7 | | by resolution of the Board, may borrow sums from the Fund and
| 8 | | provide for repayment as soon as may be practical upon receipt | 9 | | of payments of
principal and interest by a borrower on State | 10 | | Guarantee Loans under this
Section, Section 830-30,
Section | 11 | | 830-45,
Section 830-50, or Section 830-55 , or Article 835 . | 12 | | Money may be borrowed from the Fund by
the Authority for the | 13 | | sole purpose of paying certain interest costs for
borrowers | 14 | | associated with selling a loan subject to a State Guarantee | 15 | | under
this
Section, Section 830-30,
Section 830-45,
Section | 16 | | 830-50, or Section 830-55 , or Article 835 in a secondary market | 17 | | as may be deemed
reasonable and necessary by the Authority.
| 18 | | (d) Notwithstanding the provisions of this
Section 830-35 | 19 | | with respect to the
farmers, agribusinesses, and lenders who | 20 | | may obtain State Guarantees, the
Authority may promulgate rules | 21 | | establishing the eligibility of farmers,
agribusinesses, and | 22 | | lenders to participate in the State Guarantee program and
the | 23 | | terms, standards, and procedures that will apply, when the | 24 | | Authority finds
that emergency conditions in Illinois | 25 | | agriculture have created the need for
State Guarantees pursuant | 26 | | to terms, standards, and procedures other than those
specified |
| | | SB0324 Enrolled | - 16 - | LRB099 02938 JLK 22946 b |
|
| 1 | | in this
Section.
| 2 | | (Source: P.A. 96-897, eff. 5-24-10.)
| 3 | | (20 ILCS 3501/830-45)
| 4 | | Sec. 830-45. Young Farmer Loan Guarantee Program.
| 5 | | (a) The Authority is authorized to issue State Guarantees | 6 | | to lenders for
loans
to finance or refinance debts of young | 7 | | farmers. For the purposes of this
Section, a young farmer is a | 8 | | resident of Illinois who is at least 18 years of
age and who is | 9 | | a principal operator of a farm or land, who derives at least | 10 | | 50%
of annual gross income from farming, whose net worth is not | 11 | | less than $10,000
and whose debt to asset ratio is not less | 12 | | than 40%. For the purposes of this
Section, debt to asset ratio | 13 | | means current outstanding liabilities, including
any debt to be | 14 | | financed or refinanced under this
Section 830-45, divided by
| 15 | | current outstanding assets. The Authority shall establish the | 16 | | maximum
permissible debt to asset ratio based on criteria | 17 | | established by the Authority.
Lenders shall apply for the State | 18 | | Guarantees on forms provided by the Authority
and certify that | 19 | | the application and any other documents submitted are true and
| 20 | | correct. The lender or borrower, or both in combination, shall | 21 | | pay an
administrative fee as determined by the Authority. The | 22 | | applicant shall be
responsible for paying any fee or charge | 23 | | involved in recording mortgages,
releases, financing | 24 | | statements, insurance for secondary market issues, and any
| 25 | | other similar fee or charge that the Authority may require. The |
| | | SB0324 Enrolled | - 17 - | LRB099 02938 JLK 22946 b |
|
| 1 | | application
shall at a minimum contain the young farmer's name, | 2 | | address, present credit and
financial information, including | 3 | | cash flow statements, financial statements,
balance sheets, | 4 | | and any other information pertinent to the application, and the
| 5 | | collateral to be used to secure the State Guarantee. In | 6 | | addition, the borrower
must certify to the Authority that, at | 7 | | the time the State Guarantee is
provided,
the borrower will not | 8 | | be delinquent in the repayment of any debt. The lender
must | 9 | | agree to charge a fixed or adjustable interest rate that the | 10 | | Authority
determines to be below the market rate of interest | 11 | | generally available to the
borrower. If both the lender and | 12 | | applicant agree, the interest rate on the
State guaranteed loan | 13 | | can be converted to a fixed interest rate at any time
during | 14 | | the term of the loan.
State Guarantees provided under this
| 15 | | Section (i) shall not exceed $500,000 per
young farmer, (ii) | 16 | | shall be set up on a payment schedule not to exceed 30
years,
| 17 | | but shall be no longer than 15 years in duration, and (iii) | 18 | | shall be subject to
an annual review and renewal by the lender | 19 | | and the Authority. A young farmer
may
use this program more | 20 | | than once provided the aggregate principal amount of
State
| 21 | | Guarantees under this
Section to that young farmer does not | 22 | | exceed $500,000. No
State Guarantee shall be revoked by the | 23 | | Authority without a 90-day notice, in
writing, to all parties.
| 24 | | (b) The Authority shall provide or renew a State Guarantee | 25 | | to a lender if:
| 26 | | (i) The lender pays a fee equal to 25 basis points on |
| | | SB0324 Enrolled | - 18 - | LRB099 02938 JLK 22946 b |
|
| 1 | | the loan to the
Authority on
an annual basis.
| 2 | | (ii) The application provides collateral acceptable to | 3 | | the
Authority that is at least equal to the State | 4 | | Guarantee.
| 5 | | (iii) The lender
assumes all responsibility and costs | 6 | | for pursuing legal action on collecting
any
loan that is | 7 | | delinquent or in default.
| 8 | | (iv) The lender is at risk for the
first 15% of the | 9 | | outstanding principal of the note for which the State
| 10 | | Guarantee
is provided.
| 11 | | (c) The Illinois Agricultural Loan Guarantee Fund , and the | 12 | | Illinois Farmer and Agribusiness Loan Guarantee Fund , and the | 13 | | Industrial Project Insurance Fund may be used to
secure State | 14 | | Guarantees issued under this
Section as provided in
Section | 15 | | 830-30 , and Section 830-35 , and subsection (j) of Section | 16 | | 805-20 , respectively. All payments by the Authority to satisfy | 17 | | claims against the State Guarantee shall be made, in whole or | 18 | | in part, from any of the following funds in such order and in | 19 | | such amounts as the Authority shall determine: (1) the | 20 | | Industrial Project Insurance Fund (if the Authority exercises | 21 | | its discretion under subsection (j) of Section 805-20); (2) the | 22 | | Illinois Agricultural Loan Guarantee Fund; or (3) the Illinois | 23 | | Farmer and Agribusiness Loan Guarantee Fund.
| 24 | | (d) Notwithstanding the provisions of this
Section 830-45 | 25 | | with respect to the
young farmers and lenders who may obtain | 26 | | State Guarantees, the Authority may
promulgate rules |
| | | SB0324 Enrolled | - 19 - | LRB099 02938 JLK 22946 b |
|
| 1 | | establishing the eligibility of young farmers and lenders to
| 2 | | participate in the State Guarantee program and the terms, | 3 | | standards, and
procedures that will apply, when the Authority | 4 | | finds that emergency conditions
in Illinois agriculture have | 5 | | created the need for State Guarantees pursuant to
terms, | 6 | | standards, and procedures other than those specified in this
| 7 | | Section.
| 8 | | (Source: P.A. 96-897, eff. 5-24-10.)
| 9 | | (20 ILCS 3501/830-55) | 10 | | Sec. 830-55. Working Capital Loan Guarantee Program. | 11 | | (a) The Authority is authorized to issue State Guarantees | 12 | | to lenders for loans to finance needed input costs related to | 13 | | and in connection with planting and raising agricultural crops | 14 | | and commodities in Illinois. Eligible input costs include, but | 15 | | are not limited to, fertilizer, chemicals, feed, seed, fuel, | 16 | | parts, and repairs. At the discretion of the Authority, the | 17 | | farmer, producer, or agribusiness must be able to provide the | 18 | | originating lender with a first lien on the proposed crop or | 19 | | commodity to be raised and an assignment of Federal Crop | 20 | | Insurance sufficient to secure the Working Capital Loan. | 21 | | Additional collateral may be required as deemed necessary by | 22 | | the lender and the Authority. | 23 | | For the purposes of this Section, an eligible farmer, | 24 | | producer, or agribusiness is a resident of Illinois who is at | 25 | | least 18 years of age and who is a principal operator of a farm |
| | | SB0324 Enrolled | - 20 - | LRB099 02938 JLK 22946 b |
|
| 1 | | or land, who derives at least 50% of annual gross income from | 2 | | farming, and whose debt to asset ratio is not less than 40%. | 3 | | For the purposes of this Section, debt to asset ratio means | 4 | | current outstanding liabilities, including any debt to be | 5 | | financed or refinanced under this Section 830-55, divided by | 6 | | current outstanding assets. The Authority shall establish the | 7 | | maximum permissible debt to asset ratio based on criteria | 8 | | established by the Authority. Lenders shall apply for the State | 9 | | Guarantees on forms provided by the Authority and certify that | 10 | | the application and any other documents submitted are true and | 11 | | correct. The lender or borrower, or both in combination, shall | 12 | | pay an administrative fee as determined by the Authority. The | 13 | | applicant shall be responsible for paying any fee or charge | 14 | | involved in recording mortgages, releases, financing | 15 | | statements, insurance for secondary market issues, and any | 16 | | other similar fee or charge that the Authority may require. The | 17 | | application shall at a minimum contain the borrower's name, | 18 | | address, present credit and financial information, including | 19 | | cash flow statements, financial statements, balance sheets, | 20 | | and any other information pertinent to the application, and the | 21 | | collateral to be used to secure the State Guarantee. In | 22 | | addition, the borrower must certify to the Authority that, at | 23 | | the time the State Guarantee is provided, the borrower will not | 24 | | be delinquent in the repayment of any debt. The lender must | 25 | | agree to charge a fixed or adjustable interest rate that the | 26 | | Authority determines to be below the market rate of interest |
| | | SB0324 Enrolled | - 21 - | LRB099 02938 JLK 22946 b |
|
| 1 | | generally available to the borrower. If both the lender and | 2 | | applicant agree, the interest rate on the State guaranteed loan | 3 | | can be converted to a fixed interest rate at any time during | 4 | | the term of the loan. State Guarantees provided under this | 5 | | Section (i) shall not exceed $250,000 per borrower, (ii) shall | 6 | | be repaid annually, and (iii) shall be subject to an annual | 7 | | review and renewal by the lender and the Authority. The State | 8 | | Guarantee may be renewed annually, for a period not to exceed 3 | 9 | | total years per State Guarantee, if the borrower meets | 10 | | financial criteria and other conditions, as established by the | 11 | | Authority. A farmer or agribusiness may use this program more | 12 | | than once provided the aggregate principal amount of State | 13 | | Guarantees under this Section to that farmer or agribusiness | 14 | | does not exceed $250,000 annually. No State Guarantee shall be | 15 | | revoked by the Authority without a 90-day notice, in writing, | 16 | | to all parties. | 17 | | (b) The Authority shall provide a State Guarantee to a | 18 | | lender if: | 19 | | (i) The borrower pays to the Authority a fee equal to | 20 | | 100 basis points on the loan. | 21 | | (ii) The application provides collateral acceptable to | 22 | | the Authority that is at least equal to the State | 23 | | Guarantee. | 24 | | (iii) The lender assumes all responsibility and costs | 25 | | for pursuing legal action on collecting any loan that is | 26 | | delinquent or in default. |
| | | SB0324 Enrolled | - 22 - | LRB099 02938 JLK 22946 b |
|
| 1 | | (iv) The lender is at risk for the first 15% of the | 2 | | outstanding principal of the note for which the State | 3 | | Guarantee is provided. | 4 | | (c) The Illinois Agricultural Loan Guarantee Fund , and the | 5 | | Illinois Farmer and Agribusiness Loan Guarantee Fund , and the | 6 | | Industrial Project Insurance Fund may be used to secure State | 7 | | Guarantees issued under this Section as provided in Section | 8 | | 830-30 , and Section 830-35 , and subsection (j) of Section | 9 | | 805-20 , respectively. If the Authority exercises its | 10 | | discretion under subsection (j) of Section 805-20 to secure a | 11 | | State Guarantee with the Industrial Project Insurance Fund and | 12 | | also exercises its discretion under this subsection to secure | 13 | | the same State Guarantee with the Illinois Agricultural Loan | 14 | | Guarantee Fund, the Illinois Farmer and Agribusiness Loan | 15 | | Guarantee Fund, or both, all payments by the Authority to | 16 | | satisfy claims against the State Guarantee shall be made from | 17 | | the Industrial Project Insurance Fund, the Illinois | 18 | | Agricultural Loan Guarantee Fund, or the Illinois Farmer and | 19 | | Agribusiness Loan Guarantee Fund, as applicable, in such order | 20 | | and in such amounts as the Authority shall determine. | 21 | | (d) Notwithstanding the provisions of this Section 830-55 | 22 | | with respect to the borrowers and lenders who may obtain State | 23 | | Guarantees, the Authority may promulgate rules establishing | 24 | | the eligibility of borrowers and lenders to participate in the | 25 | | State Guarantee program and the terms, standards, and | 26 | | procedures that will apply, when the Authority finds that |
| | | SB0324 Enrolled | - 23 - | LRB099 02938 JLK 22946 b |
|
| 1 | | emergency conditions in Illinois agriculture have created the | 2 | | need for State Guarantees pursuant to terms, standards, and | 3 | | procedures other than those specified in this Section.
| 4 | | (Source: P.A. 96-897, eff. 5-24-10.) | 5 | | (20 ILCS 3501/Art. 835 heading new) | 6 | | ARTICLE 835. VETERANS ASSISTANCE | 7 | | (20 ILCS 3501/835-5 new) | 8 | | Sec. 835-5. Legislative findings. The General Assembly | 9 | | hereby finds and declares the following: (i) that there is an | 10 | | inadequate supply of funds available in this State at rates | 11 | | sufficiently low to enable veterans to own and operate small | 12 | | businesses
successfully in this State; (ii) such an inadequate | 13 | | supply of funds makes the
transition of veterans from service | 14 | | in the armed forces of the United States to civilian life more | 15 | | difficult and results in increased unemployment of veterans and | 16 | | its attendant problems; (iii) that there have been recurrent | 17 | | shortages of funds available to small businesses owned and | 18 | | operated by veterans in this State from private market sources | 19 | | at reasonable interest rates; and (iv) that the ordinary | 20 | | operations of
private enterprise have not in the past corrected | 21 | | these conditions. | 22 | | (20 ILCS 3501/835-10 new) | 23 | | Sec. 835-10. Definitions. As used or referred to in this |
| | | SB0324 Enrolled | - 24 - | LRB099 02938 JLK 22946 b |
|
| 1 | | Article 835, the following
words and terms shall have the | 2 | | following meanings, except where the context clearly requires | 3 | | otherwise: | 4 | | "Fund" means one or more of the Industrial Project | 5 | | Insurance Fund, the
Illinois Agricultural Loan Guarantee Fund, | 6 | | or the Illinois Farmer and Agribusiness Loan Guarantee Fund, as | 7 | | applicable. | 8 | | "Illinois Agricultural Loan Guarantee Fund" means the | 9 | | Illinois Agricultural Loan Guarantee Fund created under | 10 | | Section 830-30(c) of this Act. | 11 | | "Illinois Farmer and Agribusiness Loan Guarantee Fund" | 12 | | means the Illinois Farmer and Agribusiness Loan Guarantee Fund | 13 | | created under Section 830-35(c) of this Act. | 14 | | "Industrial Project Insurance Fund" means the Industrial | 15 | | Project Insurance
Fund created under Section 805-15 of this | 16 | | Act. | 17 | | "Qualified veteran-owned small business" has the meaning | 18 | | provided in subsection (e) of Section 45-57 of the Illinois | 19 | | Procurement Code. | 20 | | (20 ILCS 3501/835-15 new) | 21 | | Sec. 835-15. Powers and duties. The Authority may enter | 22 | | into a State Guarantee with a lender, or a person holding a | 23 | | note, of a loan or loans to a qualified veteran-owned small | 24 | | business and may make payment, in whole or in part, on a State | 25 | | Guarantee from any of the following funds in such order and in |
| | | SB0324 Enrolled | - 25 - | LRB099 02938 JLK 22946 b |
|
| 1 | | such amounts as the Authority shall determine: (1) the | 2 | | Industrial
Project Insurance Fund (if the Authority exercises | 3 | | its discretion under subsection (j) of Section 805-20); (2) the | 4 | | Illinois Agricultural Loan Guarantee Fund; or (3) the Illinois | 5 | | Farmer and Agribusiness Loan Guarantee Fund. | 6 | | (20 ILCS 3501/835-20 new) | 7 | | Sec. 835-20. State Guarantees for loans to qualified | 8 | | veteran-owned small businesses. | 9 | | (a) The Authority is authorized to issue State Guarantees | 10 | | to lenders for loans to qualified
veteran-owned small | 11 | | businesses for the general corporate purposes of those | 12 | | qualified veteran-owned small businesses. Lenders shall apply | 13 | | for the State Guarantees on forms provided by the Authority, | 14 | | certify that the application and any other documents submitted | 15 | | are true and correct, and pay an administrative fee as | 16 | | determined by the Authority. The applicant shall be responsible | 17 | | for paying any fees or charges involved in recording mortgages, | 18 | | releases, and financing statements, and any other similar fees | 19 | | or charges as the Authority may require. The application shall, | 20 | | at a minimum, contain the name, address, present credit and | 21 | | financial information, including
cash flow statements, | 22 | | financial statements, and balance sheets, of the qualified | 23 | | veteran-owned small business, any other information pertinent | 24 | | to the application, and the collateral to be used to secure the | 25 | | State Guarantee. |
| | | SB0324 Enrolled | - 26 - | LRB099 02938 JLK 22946 b |
|
| 1 | | In addition, the lender must agree to charge an interest | 2 | | rate, which may vary, on the loan that the Authority determines | 3 | | to be below the market rate of interest generally available to | 4 | | the borrower. If both the lender and applicant agree, the | 5 | | interest rate on the loan subject to a State Guarantee can be | 6 | | converted to a fixed interest rate at any time during the term | 7 | | of the loan. Any State Guarantees provided under this Section | 8 | | shall (i) not exceed $500,000 per qualified veteran-owned small | 9 | | business, (ii) not exceed a term of 15 years, and (iii) be | 10 | | subject to an
annual review and renewal by the lender and the | 11 | | Authority; provided that only one such State Guarantee shall be | 12 | | made per qualified veteran-owned small business, except that | 13 | | additional State Guarantees may be made for purposes of | 14 | | expansion of projects financed in part by a previously issued | 15 | | State Guarantee. No State Guarantee shall be revoked by the | 16 | | Authority without a 90-day notice, in writing, to all parties. | 17 | | The lender shall not call due any loan for any reason except | 18 | | for lack of performance, insufficient collateral, or maturity. | 19 | | A lender may review and withdraw or continue with a State | 20 | | Guarantee on an annual basis after the first 5 years following | 21 | | closing of the loan application if the loan contract provides | 22 | | for an interest rate that does not vary. A lender shall not | 23 | | withdraw a State Guarantee if the loan contract provides for an | 24 | | interest rate that may vary, except for reasons set forth in | 25 | | this Section. | 26 | | (b) The Authority shall provide or renew a State Guarantee |
| | | SB0324 Enrolled | - 27 - | LRB099 02938 JLK 22946 b |
|
| 1 | | to a lender if: | 2 | | (1) a fee equal to 25 basis points on the loan is paid | 3 | | to the Authority on an annual basis by the lender; | 4 | | (2) the application provides collateral acceptable to | 5 | | the Authority that is at least equal to
the State's portion | 6 | | of the Guarantee to be provided; | 7 | | (3) the lender assumes all responsibility and costs for | 8 | | pursuing legal action on
collecting any loan that is | 9 | | delinquent or in default; and | 10 | | (4) the lender is responsible for the first 15% of the | 11 | | outstanding principal of the note for which the State | 12 | | Guarantee has been applied. | 13 | | (c) If, for any reason, the General Assembly fails to make | 14 | | an appropriation sufficient to
meet the obligations under a | 15 | | State Guarantee, this Act shall constitute an irrevocable and | 16 | | continuing appropriation of an amount necessary to secure | 17 | | guarantees as defaults occur and the irrevocable and continuing | 18 | | authority for, and direction to, the State Treasurer and the | 19 | | Comptroller to make the necessary transfers to the Industrial | 20 | | Project Insurance Fund, the Illinois Agricultural Loan | 21 | | Guarantee Fund, or the Illinois Farmer and Agribusiness Loan | 22 | | Guarantee Fund, or any combination of those funds, as directed | 23 | | by the Governor, out of the General Revenue Fund. In the event | 24 | | of a default by the borrower on a loan subject to a State | 25 | | Guarantee under this Section, Section 830-30, Section 830-35, | 26 | | Section 830-45, Section 830-50, or Section 830–55, the lender |
| | | SB0324 Enrolled | - 28 - | LRB099 02938 JLK 22946 b |
|
| 1 | | shall be entitled to, and the Authority shall direct payment | 2 | | on, the State Guarantee after 90 days of delinquency. Payments | 3 | | by the Authority to satisfy claims against the State Guarantee | 4 | | shall be made, in whole or in part, from any of the following | 5 | | funds in such order and in such amounts as the Authority shall | 6 | | determine: (1) the Industrial Project Insurance Fund created | 7 | | under Article 805 of this Act (if the Authority exercises its | 8 | | discretion under subsection (j) of Section 805-20); (2) the | 9 | | Illinois Farmer and Agribusiness Loan Guarantee Fund; or (3) | 10 | | the
Illinois Agricultural Loan Guarantee Fund. It shall be the | 11 | | responsibility of the lender to proceed with collecting and | 12 | | disposing of collateral on the State Guarantee under this | 13 | | Section within 14 months after the State Guarantee is declared | 14 | | delinquent. If the lender does not dispose of the collateral | 15 | | within that 14-month period, the lender shall be liable to | 16 | | repay to the State interest on the State Guarantee at a rate | 17 | | equal to the same rate that the lender charges on the State | 18 | | Guarantee, provided that the
Authority shall have the authority | 19 | | to extend the 14-month period for a lender in the case of | 20 | | bankruptcy or extenuating circumstances. The applicable fund | 21 | | or funds shall be reimbursed for any amounts paid under this | 22 | | Section, Section 830-30, Section 830-35, Section 830-45, | 23 | | Section 830-50, or Section 830-55 upon liquidation of the | 24 | | collateral. The Authority, by resolution of the Board, may | 25 | | borrow sums from a fund or funds and provide for repayment as | 26 | | soon as may be
practical upon receipt of payments of principal |
| | | SB0324 Enrolled | - 29 - | LRB099 02938 JLK 22946 b |
|
| 1 | | and interest by a borrower on loans subject to a State | 2 | | Guarantee under this Section, Section 830-30, Section 830-35, | 3 | | Section 830-45, Section 830-50, or Section 830-55. Money may be | 4 | | borrowed from the Fund by the Authority for the sole
purpose of | 5 | | paying certain interest costs for borrowers associated with | 6 | | selling a loan subject to a State Guarantee under this Section, | 7 | | Section 830–30, Section 830–35, Section 830-45, Section
| 8 | | 830-50, or Section 830-55 in a secondary market as may be | 9 | | deemed reasonable and necessary by the Authority. | 10 | | (d) Notwithstanding the provisions of this Section with | 11 | | respect to the qualified veteran-owned small businesses and | 12 | | lenders who may obtain State Guarantees, the Authority
may | 13 | | adopt rules establishing the eligibility of qualified | 14 | | veteran-owned small businesses and lenders to participate in | 15 | | the State Guarantee program and the terms, standards, and | 16 | | procedures that will apply, if the Authority finds that | 17 | | emergency conditions in Illinois have
created the need for | 18 | | State Guarantees pursuant to terms, standards, and procedures | 19 | | other than those specified in this Section. | 20 | | (20 ILCS 3501/835-25 new) | 21 | | Sec. 835-25. Authority administrative expenses. For | 22 | | fiscal years 2017 through 2019, the Authority is authorized to | 23 | | reimburse itself for the ordinary and necessary expenses of | 24 | | administering the State Guarantee
program under this Article | 25 | | from amounts from time to time available in the Industrial |
| | | SB0324 Enrolled | - 30 - | LRB099 02938 JLK 22946 b |
|
| 1 | | Project Insurance Fund in amounts not to exceed: (1) $275,000 | 2 | | in fiscal year 2017; and (2) $200,000 per fiscal year in fiscal | 3 | | years 2018 and 2019. Ordinary and necessary expenses of | 4 | | administering those State Guarantee programs include, without | 5 | | limitation, costs of general administration, staff, accounting | 6 | | and auditing services, legal services, judgments, loan | 7 | | servicing, realization upon collateral, communications with | 8 | | borrowers and lenders, and similar expenses, all to the extent | 9 | | reasonably allocable to such State Guarantee programs. | 10 | | This Section is repealed on August 1, 2019.
| 11 | | Section 99. Effective date. This Act takes effect upon | 12 | | becoming law.
|
|