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(105 ILCS 5/1F-62)
(This Section scheduled to be repealed in accordance with 105 ILCS 5/1F-165)
School District Emergency Financial Assistance Fund;
grants and loans.
(a) Moneys in the School District Emergency Financial Assistance Fund
established under Section 1B-8 of this Code may be allocated and
expended by the State Board as grants to provide technical and consulting services to school districts to assess their financial condition and by the Illinois Finance Authority for emergency financial assistance loans to a School Finance
Authority that petitions for
An emergency financial assistance loan to a School Finance Authority or borrowing from
sources other than the State shall not be
considered as part of the calculation of a district's debt for purposes of
the limitation specified in Section 19-1 of this Code. From the amount allocated to each School Finance Authority, the State Board shall identify a sum sufficient to cover all approved costs of the School Finance Authority. If the State Board and State Superintendent have not approved emergency financial assistance in conjunction with the appointment of a School Finance Authority, the Authority's approved costs shall be paid from deductions from the district's general State aid.
The School Finance Authority may prepare and file with the State
Superintendent a proposal for emergency financial assistance for the school district and for its operations budget. No expenditures shall be
authorized by the State Superintendent until he or she has approved
the proposal of the School Finance Authority, either as submitted or in such lesser amount determined by the State Superintendent.
(b) The amount of an emergency financial assistance
loan that may be allocated to a School Finance Authority under this Article,
including moneys necessary for the operations of the School Finance Authority, and borrowing
from sources other than the State shall not
exceed, in the aggregate, $4,000 times the number of pupils enrolled in the
during the school year ending June 30 prior to the date of approval by
the State Board of the petition for emergency financial assistance, as
certified to the school board and the School Finance Authority by the State
However, this limitation does not apply to borrowing by the district secured
amounts levied by the district prior to establishment of the School Finance
Authority. An emergency financial assistance grant shall not exceed $1,000 times the number of such pupils. A district may receive both a loan and a grant.
(c) The payment of a State emergency financial assistance grant or loan
shall be subject to appropriation by the General Assembly. State
emergency financial assistance allocated and paid to a School Finance Authority
under this Article may be applied to any fund or funds from which the
Authority is authorized to make expenditures by
(d) Any State emergency financial assistance proposed by the
School Finance Authority and approved by the State Superintendent may be paid in its
entirety during the initial year of the School Finance Authority's existence or spread in
equal or declining amounts over a period of years not to exceed the
period of the School Finance Authority's existence. The State Superintendent shall not
approve any loan to the School Finance Authority unless the School Finance Authority has been
unable to borrow sufficient funds to operate the district.
All loan payments made from the School District Emergency
Financial Assistance Fund to a School Finance Authority shall be required to be
repaid not later than the date the School Finance Authority ceases to exist, with simple
interest over the term of the loan at a rate equal to
50% of the one-year Constant Maturity Treasury (CMT) yield as last published
by the Board of Governors of the Federal Reserve System
date on which the School Finance Authority's loan is approved by the State
The School Finance Authority shall establish and the Illinois Finance Authority shall
approve the terms and conditions of the loan, including the schedule of
The schedule shall provide for repayments commencing July 1 of each
year or upon each fiscal year's receipt of moneys from a tax levy for emergency financial assistance. Repayment shall be incorporated into the annual budget of the
district and may be made from any fund or funds of the district in
which there are moneys available. Default on repayment is subject to the Illinois Grant Funds Recovery Act.
When moneys are repaid as provided
in this Section, they shall not be made available to the School Finance Authority for
further use as emergency financial assistance under this Article at any
time thereafter. All repayments required to be made by a School Finance Authority
shall be received by the State Board and deposited in the School District
Emergency Financial Assistance Fund.
In establishing the terms and conditions for the repayment
obligation of the School Finance Authority, the School Finance
Authority shall annually determine
whether a separate local property tax levy is required to meet that obligation.
The School Finance Authority
shall provide for a separate tax
levy for emergency financial assistance repayment purposes. This tax
levy shall not be subject to referendum approval. The amount of the levy
shall not exceed the amount necessary to meet the annual
emergency financial repayment
obligations of the district, including principal and interest, as established
by the School Finance Authority.
(Source: P.A. 94-234, eff. 7-1-06