[ Search ] [ Legislation ]
[ Home ] [ Back ] [ Bottom ]
| [ Introduced ] |
91_HB1967eng HB1967 Engrossed LRB9104760MWmg 1 AN ACT to amend the Illinois Farm Development Act by 2 adding Section 12.6. 3 Be it enacted by the People of the State of Illinois, 4 represented in the General Assembly: 5 Section 5. The Illinois Farm Development Act is amended 6 by adding Section 12.6 as follows: 7 (20 ILCS 3605/12.6 new) 8 Sec. 12.6. Enhanced Value-Added Agriculture Production 9 Guarantee Program. 10 (a) The Authority may issue State Guarantees to lenders 11 for loans to finance or refinance debts for specialized 12 agribusinesses that are or will be (i) engaged in the process 13 of adding value to agricultural products and (ii) located in 14 Illinois. For the purposes of this Section, agribusiness 15 includes, but is not limited to, the operation of research, 16 development, processing, marketing, production, and the sale 17 of agricultural products and production agriculture. 18 (b) Lenders must apply for the State Guarantees on forms 19 provided by the Authority and must certify that the 20 application and any other documents submitted to the 21 Authority are true and correct. The lender or borrower, or 22 both in combination, must pay an administrative fee 23 determined by the Authority. The applicant is responsible 24 for paying any fee or charge involved in recording mortgages, 25 releases, financing statement, insurance for secondary market 26 issues, and any other similar fee or charge that the 27 Authority may require. The application must, at a minimum, 28 contain the farmer's name; address; present credit and 29 financial information, including cash flow statements, 30 financial statements, balance sheets, and any other 31 information pertinent to the application; and the collateral HB1967 Engrossed -2- LRB9104760MWmg 1 to be used to secure the State Guarantee. In addition, the 2 borrower must certify to the Authority that, at the time the 3 State Guarantee is provided, the borrower will not be 4 delinquent in the repayment of any debt. The lender must 5 agree to charge a fixed or adjustable rate that the Authority 6 determines is below the market rate of interest generally 7 available to the borrower. If both the lender and the 8 borrower agree, the interest rate on the State guaranteed 9 loan can be converted to a fixed interest rate at any time 10 during the term of the loan. 11 (c) State Guarantees provided under this Section (i) may 12 not exceed $1,000,000 per applicant, (ii) may not be longer 13 than 15 years in duration, and (iii) are subject to an annual 14 review and renewal by the lender and the Authority. An 15 applicant may use this program more than once, provided that 16 the aggregate principal amount to State Guarantees under this 17 Section to the applicant does not exceed $1,000,000. A State 18 Guarantee may not be revoked by the Authority without a 19 90-day notice, in writing, to all parties. 20 (d) The Authority must provide or renew a State Guarantee 21 to a lender if: 22 (1) The lender pays a fee equal to 25 basis points 23 on the loan to the Authority on an annual basis. 24 (2) The application provides collateral acceptable 25 to the Authority that is at least equal to the State 26 Guarantee. 27 (3) The lender assumes all responsibility and costs 28 for pursuing legal action on collecting any loan that is 29 delinquent or in default. 30 (4) The lender is at risk for the first 15% of the 31 outstanding principal of the note for which the State 32 Guarantee is provided. 33 (e) The Illinois Farmer and Agribusiness Loan Guarantee 34 Fund may be used to secure the State Guarantees issued under HB1967 Engrossed -3- LRB9104760MWmg 1 this Section. 2 Section 99. Effective date. This Act takes effect upon 3 becoming law.