Bill Text: IL HB5117 | 2011-2012 | 97th General Assembly | Introduced

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Bill Title: Amends the Illinois Finance Authority Act. Creates the Rural Natural Gas Expansion Loan Guarantee Program. Authorizes the Authority to issue State Guarantees to lenders for loans to agribusinesses for the purpose of expanding or increasing capacity of natural gas lines for their agribusiness. Provides that lenders shall apply for the State Guarantees on forms provided by the Authority. Provides that the lender must agree to charge an interest rate, which may vary, that the Authority determines to be below the market rate of interest generally available to the agribusiness. Provides that a State Guarantee shall not exceed $5,000,000 per agribusiness. Provides that the Illinois Farmer and Agribusiness Loan Guarantee Fund may be used to secure State Guarantees.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Failed) 2013-01-08 - Session Sine Die [HB5117 Detail]

Download: Illinois-2011-HB5117-Introduced.html

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97TH GENERAL ASSEMBLY State of Illinois 2011 and 2012 HB5117 Introduced , by Rep. Wayne Rosenthal SYNOPSIS AS INTRODUCED:
20 ILCS 3501/830-60 new
Amends the Illinois Finance Authority Act. Creates the Rural Natural Gas Expansion Loan Guarantee Program. Authorizes the Authority to issue State Guarantees to lenders for loans to agribusinesses for the purpose of expanding or increasing capacity of natural gas lines for their agribusiness. Provides that lenders shall apply for the State Guarantees on forms provided by the Authority. Provides that the lender must agree to charge an interest rate, which may vary, that the Authority determines to be below the market rate of interest generally available to the agribusiness. Provides that a State Guarantee shall not exceed $5,000,000 per agribusiness. Provides that the Illinois Farmer and Agribusiness Loan Guarantee Fund may be used to secure State Guarantees.
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FISCAL NOTE ACT MAY APPLY
A BILL FOR
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AN ACT concerning State government.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Finance Authority Act is amended by
adding Section 830-60 as follows:
(20 ILCS 3501/830-60 new)
Sec. 830-60. Rural Natural Gas Expansion Loan Guarantee
Program.
(a) The Authority is authorized to issue State Guarantees
to lenders for loans to agribusinesses for the purpose of
expanding or increasing capacity of natural gas lines for their
agribusinesses. "Agribusiness" has the meaning provided in
Section 801-10 of this Act.
(b) The Authority may approve applications for natural gas
line expansions and upgrades by agribusinesses that promote
expansion and diversification of the agricultural economy.
Lenders shall apply for the State Guarantees on forms provided
by the Authority and certify that the application and any other
documents submitted are true and correct. The lender or
borrower, or both in combination, shall pay an administrative
fee as determined by the Authority. The application shall, at a
minimum, contain the agribusiness' name, address, present
credit and financial information, including cash flow

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statements, financial statements, balance sheets, and any
other information pertinent to the application, and the
collateral to be used to secure the State Guarantee. The lender
must agree to charge an interest rate, which may vary, on the
loan that the Authority determines to be below the market rate
of interest generally available to the borrower. If both the
lender and applicant agree, the interest rate on the State
guaranteed loan can be converted to a fixed interest rate at
any time during the term of the loan.
(c) Any State Guarantee provided under this Section (i)
shall not exceed $5,000,000 per agribusiness, (ii) shall not
exceed a term of 15 years, and (iii) shall be subject to an
annual review and renewal by the lender and the Authority. Only
one such State Guarantee shall be made per agribusiness per
location. A State Guarantee shall not be revoked by the
Authority without a 90-day notice, in writing, to all parties.
(d) The lender shall not call due any loan for any reason
except for lack of performance, insufficient collateral, or
maturity. A lender may review and withdraw or continue with a
State Guarantee on an annual basis after the first 5 years
following closing of the loan application if the loan contract
provided for an interest rate that shall not vary. A lender
shall not withdraw a State Guarantee if the loan contract
provides for an interest rate that may vary, except for reasons
set forth in the contract.
(e) The Authority shall provide or renew a State Guarantee

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to a lender if:
(1) the lender pays a fee equal to 25 basis points on
the loan to the Authority on an annual basis;
(2) the application provides collateral acceptable to
the Authority that is at least equal to the State's portion
of the Guarantee to be provided;
(3) the lender assumes all responsibility and costs for
pursuing legal action on collecting any loan that is
delinquent or in default; and
(4) the lender is at risk for the first 15% of the
outstanding principal of the note for which the State
Guarantee is provided.
(f) The Illinois Farmer and Agribusiness Loan Guarantee
Fund may be used to secure State Guarantees issued under this
Section as provided in Section 830-35.
(g) Notwithstanding the provisions of this Section 830-60,
with respect to the agribusinesses that may obtain State
Guarantees, the Authority may promulgate rules establishing
the eligibility of agribusinesses and lenders to participate in
the State Guarantee program and the terms, standards, and
procedures that will apply, if the Authority finds that
emergency conditions in Illinois agriculture have created the
need for State Guarantees pursuant to terms, standards, and
procedures other than those specified in this Section.