97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB5163

 

Introduced 2/8/2012, by Rep. Brandon W. Phelps

 

SYNOPSIS AS INTRODUCED:
 
30 ILCS 350/11  from Ch. 17, par. 6911

    Amends the Local Government Debt Reform Act. Provides that bonds that have been refunded shall not be considered to be indebtedness for the purposes of any statutory or other debt limitation if the refunded bonds are secured by and to be paid as to principal, interest, and premium from an escrow account that is invested in certain obligations and is determined to be sufficient for the timely payment of principal and interest on the refunded bonds. Provides that any governmental unit may deposit cash into an escrow account to be held uninvested for the purpose of refunding or providing for the payment of principal, interest, and premium on its bonds.


LRB097 18390 PJG 63616 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB5163LRB097 18390 PJG 63616 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 5. The Local Government Debt Reform Act is amended
5by changing Section 11 as follows:
 
6    (30 ILCS 350/11)  (from Ch. 17, par. 6911)
7    Sec. 11. Refundings and redemption premiums. Bonds may be
8refunded or advance refunded upon such terms as the governing
9body may set in accordance with this Act, for such term of
10years, not in excess of the maximum term of years permitted by
11applicable law for the bonds to be refunded, and in such
12principal amount, all as may be deemed necessary by the
13governing body. Revenue bonds may be issued to refund general
14obligation bonds or alternate bonds issued under this Act.
15General obligation bonds shall not be issued to refund revenue
16bonds or alternate bonds except as expressly permitted by
17applicable law. Any redemption premium payable upon the
18redemption of bonds may be payable from the proceeds of
19refunding bonds which may be issued for the purpose of
20refunding such bonds, from any other lawfully available source
21or from both proceeds and such other sources.
22    Bonds which have been refunded shall not be considered to
23be indebtedness for the purposes of any statutory or other debt

 

 

HB5163- 2 -LRB097 18390 PJG 63616 b

1limitation if such refunded bonds are secured by and to be paid
2as to principal, interest, and premium, if any, from an escrow
3account which is: (i) invested in (a) obligations of the United
4States of America, (b) obligations which are guaranteed by the
5full faith and credit of the United States of America as to the
6timely payment of principal and interest, or (c) bonds of any
7state or governmental unit that are rated at the time of
8purchase within the 3 highest general classifications
9established by a rating service of nationally recognized
10expertise in rating bonds of states and their political
11subdivisions; and (ii) determined by an independent certified
12public accountant or nationally recognized feasibility analyst
13to be sufficient to provide for the timely payment of principal
14of and interest on the refunded bonds when due or upon
15redemption.
16    Any governmental unit may deposit cash into an escrow
17account to be held uninvested for the purpose of refunding or
18providing for the payment of principal, interest, and premium,
19if any, on its bonds, and bonds which have been so refunded or
20provided for shall not be considered to be indebtedness for the
21purposes of any statutory or other debt limitation.
22(Source: P.A. 90-306, eff. 8-1-97.)