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90_HB1479
New Act
30 ILCS 105/5.449 new
Creates the Invest in Illinois Act. Establishes a Capital
Access Program governed by a board of directors consisting of
the Treasurer, the Director of Commerce and Community
Affairs, and 7 members appointed by the Governor. Provides
that the Program shall operate a Portfolio Risk Insurance
Reserve Fund to encourage financial institutions to make
loans for economic development purposes. Creates the Invest
in Illinois Fund, a special Fund in the State treasury, that,
upon appropriation, may be used to operate the Portfolio Risk
Insurance Reserve Fund. Effective immediately.
LRB9004487PTcw
LRB9004487PTcw
1 AN ACT to create the Illinois Capital Access Program and
2 to prescribe its powers and duties.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 1. Short title. This Act may be cited as the
6 Invest in Illinois Act.
7 Section 5. Definitions. As used in this Act:
8 "Account" means the loan insurance account established
9 for each financial institution upon signing a participation
10 agreement with the Capital Access Program, unless the context
11 clearly requires a different meaning.
12 "Board" means the board of directors of the Illinois
13 Capital Access Program.
14 "Economic development project" means an endeavor related
15 to industrial, commercial, warehouse, distribution, or
16 agricultural enterprise. Economic development project does
17 not include that portion of an endeavor devoted to housing.
18 "Fund" means the Portfolio Risk Insurance Reserve Fund
19 established under Section 40 of this Act.
20 "Lender" means any federal or State chartered bank,
21 federal or State chartered savings and loan association or
22 building and loan association or federally insured credit
23 unions.
24 "Person" means an individual, sole proprietorship,
25 partnership, joint venture, profit or nonprofit corporation,
26 cooperative, trust, local industrial development corporation,
27 economic development corporation, community development
28 corporation, or other association of persons organized for
29 agricultural, commercial, or industrial purposes.
30 "Private sector" means other than the Fund, a State or
31 federal source, or an agency thereof.
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1 "Program" means the Capital Access Program as established
2 under this Act.
3 "Project" means an economic development project and, in
4 addition, means the acquisition, construction,
5 reconstruction, conversion, or leasing of an industrial,
6 commercial, retail, or agricultural enterprise, or any part
7 thereof, to carry out the purposes and objectives of this
8 Act, including, but not limited to, acquisition of land,
9 buildings, structures, or other planned or existing
10 improvements to land including leasehold improvement,
11 machinery, equipment, or furnishings which include, but are
12 not limited to, the following: research parks; office
13 facilities; engineering facilities; warehousing facilities;
14 parts distribution facilities; depots or storage facilities;
15 manufacturing facilities; water and air pollution control
16 equipment or waste disposal facilities; equipment or
17 facilities designed to produce energy from renewable
18 resources; equipment or facilities for recycling or
19 developing products for recycled materials; farms and other
20 agricultural commodity producers; agricultural harvesting,
21 storage, transportation, or processing facilities or
22 equipment.
23 "Public sector" means the Fund, a State or federal
24 source, or an agency thereof.
25 "State" means State of Illinois.
26 Section 10. Findings and declaration.
27 (a) The General Assembly hereby finds and declares the
28 following problems, conditions and obligations exist in this
29 State:
30 (1) The economy of the State of Illinois is at
31 present recovering from a recession and action is needed
32 to encourage increased employment and business expansion
33 in this State.
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1 (2) The economy of the State of Illinois is
2 undergoing a long-term transition requiring new and
3 innovative policies from State government related to job
4 creation and retention.
5 (3) There exists a need to leverage private sector
6 investment in agriculture, business, and industry.
7 (4) The current budget limitations of the State
8 require that public dollars be leveraged to the maximum
9 extent possible.
10 (5) There is a statewide pressing need for programs
11 to alleviate and prevent conditions of unemployment; to
12 preserve existing jobs and create new jobs to meet the
13 employment demands of population growth and population
14 shifts; to promote the development of existing business
15 enterprises and to meet the growing competition among
16 states and nations for business enterprises; to
17 revitalize and diversify the Illinois economy in general
18 to achieve the goals of long-term economic growth and
19 full employment; and to provide a solid tax base for the
20 State and its units of local government to provide funds
21 for needed public services.
22 (6) Small business creates jobs at 4 times the rate
23 of large businesses, and they create almost 70% of the
24 nation's new jobs.
25 (7) The retention, promotion, diversification, and
26 development of business enterprises and the lowering of
27 costs of business and production require additional means
28 of financing, including economic development finance
29 mechanisms that support private capital resources, to
30 help existing business enterprises expand more rapidly,
31 and to promote the location of additional business
32 enterprises in Illinois.
33 (8) It is necessary to provide means and methods
34 for the encouragement and assistance of industrial and
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1 commercial development projects including, but not
2 limited to, providing aid to development enterprises
3 utilizing new or experimental technologies in locating,
4 purchasing, constructing, reconstructing, modernizing,
5 improving, maintaining, repairing, furnishing, equipping,
6 and expanding in this State and its units of local
7 government.
8 (9) There are over 200,000 women business owners in
9 Illinois; women-owned businesses are one of the fastest
10 growing sectors of the Illinois economy; they have a
11 vital role in the future of the Illinois economy; and as
12 such, efforts must be made to overcome traditional
13 barriers to access credit including, but not limited to,
14 type of collateral, type of business, or work history.
15 (b) It is hereby declared to be the purposes of this Act
16 and of the Illinois Capital Access Program created by this
17 Act to satisfy the needs set forth in this Section, to
18 develop a diversified State economy, to assist business
19 enterprise in obtaining additional sources of financing, to
20 aid this State in achieving the goal of long-term economic
21 growth, to preserve existing jobs, to create new jobs, and to
22 foster export activity. It is further determined and declared
23 that it is the intention of the General Assembly to devote,
24 by separate appropriation, a portion of any unanticipated
25 revenues from the Illinois Estate and Generation-Skipping
26 Transfer Tax Act in an equal amount of 10% of the excess of
27 $120 million in collections during each subsequent fiscal
28 year until such time as funds to support the Portfolio Risk
29 Insurance Fund provided for herein are established as set
30 forth herein.
31 Section 15. Creation of the Illinois Capital Access
32 Program.
33 (a) There is hereby created a public body corporate and
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1 politic to be known as the Illinois Capital Access Program.
2 (b) The powers and duties of the Illinois Capital Access
3 Program are vested in and shall be exercised by a board of
4 directors.
5 (c) The Board shall consist of 9 members including the
6 Director of Commerce and Community Affairs, the Treasurer,
7 and 7 other members who are residents of the State with
8 knowledge, skill, and experience in the academic, business,
9 or financial field, who shall be appointed by the Governor
10 with the advice and consent of the Senate. The appointments
11 by the Governor shall occur within 60 days of the passage of
12 this Act and the Senate's confirmation shall occur as soon as
13 practicable thereafter. If the Governor does not appoint
14 these members by January 1, 1998, the appointment power is
15 transferred to the Board's chairperson with the advice and
16 consent of the Senate. If the Senate is not in session when
17 the appointments are made, the appointees shall be considered
18 temporary directors and shall have the same voting rights as
19 affirmed for statutory directors. Not more than 2 of the 7
20 appointed members of the Board shall be, during their term of
21 office on the Board, employees of the State of Illinois.
22 Three of the 7 appointed members shall be current or former
23 commercial bankers. The remainder of the appointed members
24 of the Board shall be representatives of the private sector.
25 No more than 4 of the 7 appointed members shall be from the
26 same political party. The 7 appointed members shall serve
27 for fixed terms. Of the members first appointed, 2 shall be
28 appointed for a term that expires January 1, 1999, 3 shall be
29 appointed for a term that expires January 1, 2000, and 2
30 shall be appointed for a term that expires January 1, 2001.
31 Upon completion of each fixed term, a member shall be
32 appointed for a term of 3 years. A member shall serve until
33 a successor is appointed, and a vacancy shall be filled for
34 the balance of the unexpired term in the same manner as the
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1 original appointment. If the Governor does not fill a
2 vacancy, reappoint a member, or appoint a new member within
3 60 days of the vacancy or expired term, appointment power
4 shall transfer to the Board's chairperson in the same manner
5 as the original appointment. Of the members appointed, there
6 shall be minority, female, veteran, and small business
7 representation. The Director of Commerce and Community
8 Affairs or the Treasurer may appoint a representative to
9 serve as a voting member of the Program in their absence.
10 (d) The Treasurer or his designee shall serve as the
11 Board's chairperson. The governor shall designate one member
12 to serve as the Board's vice-chair.
13 (e) Members of the Board shall serve without
14 compensation for their membership on the Board. Members of
15 the Board shall receive reasonable reimbursement for
16 necessary travel and expenses.
17 (f) The Board may delegate to its staff or others those
18 functions and authority that the Board deems necessary or
19 appropriate, which may include the oversight and supervision
20 of employees of the Program and day-to-day operations of the
21 Program.
22 (g) A majority of the members of the Board serving and
23 present in person, or if authorized by the bylaws of the
24 Board, by use of amplified telephonic equipment, at a board
25 meeting constitutes a quorum for the transaction of business
26 at a meeting, or the exercise of a power or function of the
27 Program, notwithstanding the existence of one or more
28 vacancies. The affirmative vote of 5 members shall be
29 necessary for any action taken by the Board at a meeting.
30 The Board shall meet at the call of the chair and as may be
31 provided in the bylaws of the Program. Meetings of the Board
32 may be held anywhere within the State of Illinois.
33 (h) The business of the Board shall be conducted at
34 public meetings of the Board held in compliance with the Open
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1 Meetings Act. Public notice of the time, date, and place of
2 the meeting shall be given in the manner required by law. A
3 record or portion of a record, material, or other data
4 received, prepared, used, or retained by the Program or Board
5 that relates to financial or proprietary information
6 submitted by the financial institution or applicant that is
7 considered by these parties and acknowledged by the Board as
8 confidential shall not be subject to the disclosure
9 requirements of the Freedom of Information Act. The Board
10 may also meet in closed session to make a determination of
11 whether it acknowledges as confidential any financial or
12 proprietary information submitted by a financial institution
13 or applicant and considered by the same as confidential.
14 Unless considered proprietary information, the Board shall
15 not acknowledge routine financial information as
16 confidential.
17 (i) The Program shall not disclose financial or
18 proprietary information not subject to disclosure pursuant to
19 subsection (h) without consent of the financial institution
20 or applicant submitting the information.
21 (j) Any document to which the Program is a party
22 evidencing an agreement the Program is authorized to enter
23 into shall not be considered financial or proprietary
24 information that may be exempt from disclosure under
25 subsection (h).
26 (k) For purposes of subsections (h), (i), and (j),
27 "financial or proprietary information" means information that
28 has not been publicly disseminated or that is unavailable
29 from other sources, the release of which might cause the
30 financial institution or applicant significant competitive
31 harm.
32 Section 20. Members, officers, and employees subject to
33 this Act; discharge of duties by member, officer, employee,
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1 or agent. A member of the Board or officer, employee, or
2 agent of the Program shall discharge the duties of his or her
3 position with good faith and with that degree of diligence,
4 care, and skill that an ordinarily prudent person would
5 exercise under similar circumstances in a like position. No
6 member of the Board or employee of the Program shall be
7 employed by, hold any official relation to, or have any
8 financial interest in any person or entity receiving
9 assistance under this Act without appropriate disclosure.
10 These members or employees shall abstain from discussion or
11 voting in such matters at the Board meeting. In the event it
12 is later disclosed that the Program has participated in a
13 transaction in which a member of the Board or employee of the
14 Program is a participant, such a transaction may be voidable
15 by the Program, and the Board member or employee involved may
16 be disqualified from membership on the Board or employment by
17 the Program.
18 Section 25. Powers of Program. The Program shall have
19 the powers necessary or convenient to carry out and
20 effectuate the purposes, objectives, and provisions of this
21 Act, the purposes and objectives of the Program, and the
22 powers delegated by other laws including, but not limited to,
23 the power to do the following:
24 (1) Sue and be sued; to have a seal and alter the same
25 at pleasure; to have perpetual succession; to make, execute,
26 and deliver contracts, conveyances, and other instruments
27 necessary or convenient to the exercise of its powers; and to
28 make and amend bylaws.
29 (2) Solicit and accept gifts, grants, loans, and other
30 aids from any person, foundation, or the federal, State, or a
31 local government or any agency of the federal, State, or a
32 local government, or to participate in any other way in any
33 federal, State, or local government program.
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1 (3) Procure insurance against any loss in connection
2 with the Program's property, assets, or activities.
3 (4) Invest any money of the Fund at the Program's
4 discretion, in any obligations determined proper by the
5 Program, and name and use depositories for its money. The
6 custodian and investment function of the Program shall be
7 performed by the State Treasurer.
8 (5) Engage personnel as necessary, and engage the
9 services of private consultants, managers, counsel, and
10 auditors for rendering professional management and technical
11 assistance and advice, payable out of any money of the Fund
12 legally available for this purpose.
13 (6) Charge, impose, and collect fees and charges in
14 connection with any transaction and provide for reasonable
15 penalties for delinquent payment of fees or charges.
16 (7) Do all other things necessary or convenient to
17 achieve the objectives and purposes of the Program, this Act,
18 or other laws that relate to the purposes and
19 responsibilities of the Program.
20 (8) The Board shall establish, implement, and operate a
21 portfolio risk insurance reserve fund as defined in Section
22 40 of this Act.
23 Section 30. Annual status report; audit; evaluation
24 procedures. The accounts and the books of the Program shall
25 be set up and maintained in a manner approved by the Auditor
26 General, and the Program shall file with the Auditor General
27 a certified annual report within 120 days after the close of
28 the fiscal year. The Program shall also file with the
29 Governor, the Secretary of the Senate, the Clerk of the House
30 of Representatives, and the Illinois Economic and Fiscal
31 Commission, by March 1 of each year, a written report
32 covering its activities for the previous calendar year, and
33 when so filed, the report shall be a public record and open
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1 for inspection at the offices of the Program during normal
2 business hours. The report shall include, but need not be
3 limited to, the following:
4 (1) The name and location of all participating
5 financial institutions under the Program.
6 (2) A record of loan and reserve fund activity in
7 each participating financial institution's Account.
8 (3) A list of the number and type of persons or
9 entities, by financial institution, assisted under this
10 Act.
11 (4) The duration, type, amount, and status of loans
12 made, by financial institution, under this Act.
13 (5) A list of loss claims on each participating
14 financial institution's Account by name of the person or
15 entity that defaulted on the loan.
16 (6) The projected activities of the Program for the
17 next fiscal year including the amount of financial
18 assistance needed to operate the Program.
19 Section 35. As soon as practical after creation of the
20 Program, the Board shall hold a meeting at which the bylaws
21 and schedule of regular meetings shall be adopted. The
22 bylaws and schedule may be amended from time to time at the
23 will of the Board.
24 Initial operating staff and expenses of the Program shall
25 be provided by the Treasurer from appropriations lawfully
26 made by the General Assembly. As soon as may be practical,
27 the Board shall provide for its expenses and payment of
28 employees, including salaries and contractual agreements,
29 from its operations from up to one-half of the investment
30 earnings of the investment of the Fund. The remainder of the
31 investment earnings on the Fund shall be reinvested in the
32 Fund by the Treasurer.
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1 Section 40. Portfolio Risk Insurance Reserve Fund;
2 establishment and operation. There is hereby created outside
3 of the State Treasury a special fund to be known as the
4 Portfolio Risk Insurance Reserve Fund. The General Assembly
5 shall appropriate from the Invest in Illinois Fund or from
6 such other funds the General Assembly deems necessary funds
7 sufficient to maintain the Fund. The Treasurer shall be the
8 custodian of the Fund.
9 Section 45. Loan Insurance Account; payments into
10 accounts; transfer of money.
11 (a) The Fund shall initially consist of $2,500,000 or
12 such other amounts appropriated by the General Assembly. The
13 Fund shall be established and managed by the Board and shall
14 consist of an unallocated account and accounts established by
15 participating financial institutions.
16 (b) The Board shall pay into the Fund any money
17 appropriated or otherwise provided by this State for the
18 purposes of this Act; and any other money made available to
19 the Program for the purposes of this Act from any other
20 source, public or private.
21 (c) Any financial institution, as provided in this Act,
22 may participate in the Capital Access Program upon signing a
23 participation agreement with the Program. A Loan Insurance
24 Account shall be established in the name of each financial
25 institution participating in the Program. Money may be added
26 to this Account by the Board from the Fund, the participating
27 financial institution, and persons or entities borrowing from
28 that financial institution under the Capital Access Program.
29 Money may be withdrawn from this Account only by the
30 participating financial institution as prescribed in Section
31 50 or by the Board if a transaction is deemed voidable as
32 prescribed in Section 20. This Account is between the Program
33 and the participating financial institution and is not
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1 affected by other participating financial institutions.
2 Section 50. Agreements with lenders. The agreements with
3 lenders for participation in the Capital Access Program may
4 include, but need not be limited to, the following:
5 (1) Authorization for the lender to determine, collect,
6 and transmit to the Fund a fee or premium charge based upon
7 the amount of the loan to be covered by the loan insurance
8 account within a specified range established consistent with
9 the purposes and objectives of the Program.
10 (2) Specification of whether the premium charge shall be
11 paid by the lender, the borrower, the Program, or by a
12 combination thereof in specified portions. The premium
13 charges paid by the borrower and lender may be financed.
14 (3) The procedure by which a lender may make a claim
15 upon the Account upon default by the borrower and the
16 conditions under which a claim may be made.
17 (4) The maximum amount of claims a lender may make upon
18 the Fund, which amount may be equal to, greater than, or less
19 than its proportion of the total premiums collected by the
20 Fund.
21 Section 55. There is hereby created in the State Treasury
22 a special fund, known as the Invest in Illinois Fund, which
23 shall be maintained subject to appropriation for purposes of
24 economic investment in the future economic strength of
25 Illinois.
26 Section 900. The State Finance Act is amended by adding
27 Section 5.449 as follows:
28 (30 ILCS 105/5.449 new)
29 Sec. 5.449. The Invest in Illinois Fund.
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1 Section 999. This Act takes effect upon becoming law.