101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
HB5196

 

Introduced , by Rep. Lance Yednock

 

SYNOPSIS AS INTRODUCED:
 
15 ILCS 520/7  from Ch. 130, par. 26

    Amends the Deposit of State Moneys Act. Provides that the State Treasurer may allow an eligible financial institution (rather than a bank or savings and loan association) to become a State depository. Provides that State depositories may submit proposals or applications that may be approved or rejected by the State Treasurer. Provides that the State Treasurer may accept a proposal from an eligible financial institution which provides for a reduced rate of interest provided that the financial institution documents the use of deposited funds for specified economic development projects (currently, economic community development projects). Modifies provisions concerning proposals from an eligible financial institution that provides for interest earnings on deposits of State moneys to be held by the financial institution in a separate account that the State Treasurer may use to secure up to 10% of any specified home loan to Illinois citizens. Removes provisions concerning proposals for a reduced rate of interest with moneys to be expended for specified purposes. Makes conforming changes. Effective immediately.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB5196LRB101 16826 RJF 66225 b

1    AN ACT concerning State government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Deposit of State Moneys Act is amended by
5changing Section 7 as follows:
 
6    (15 ILCS 520/7)  (from Ch. 130, par. 26)
7    Sec. 7. (a) The State Treasurer may, in his or her
8discretion, allow an eligible financial institution to become a
9State depository. State depositories may submit proposals or
10applications that may Proposals made may either be approved or
11rejected by the State Treasurer. A bank or savings and loan
12association whose proposal is approved shall be eligible to
13become a State depositary for the class or classes of funds
14covered by its proposal. A bank or savings and loan association
15whose proposal is rejected shall not be so eligible. The State
16Treasurer shall seek to have at all times a total of not less
17than 20 banks or savings and loan associations which are
18approved as State depositaries for time deposits.
19    (b) The State Treasurer may, in his or her discretion,
20accept a proposal from an eligible financial institution which
21provides for a reduced rate of interest provided that the
22financial such institution documents the use of deposited funds
23for economic community development projects, including, but

 

 

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1not limited to, agricultural, business, and community
2development projects.
3    (b-5) (Blank). The State Treasurer may, in his or her
4discretion, accept a proposal from an eligible institution that
5provides for a reduced rate of interest, provided that such
6institution agrees to expend an amount of money equal to the
7amount of the reduction for the preservation of Cahokia Mounds.
8    (b-10) (Blank). The State Treasurer may, in his or her
9discretion, accept a proposal from an eligible institution that
10provides for a reduced rate of interest, provided that the
11institution agrees to expend an amount of money equal to the
12amount of the reduction for senior centers.
13    (c) The State Treasurer may, in his or her discretion,
14accept a proposal from an eligible financial institution that
15provides for interest earnings on deposits of State moneys to
16be held by the financial institution in a separate account that
17the State Treasurer may use to secure up to 10% of any (i) home
18loans to Illinois citizens purchasing or refinancing a home in
19Illinois in situations where the participating financial
20institution would not offer the borrower a home loan under the
21financial institution's prevailing credit standards without
22the incentive of the 10% guarantee for the first 5 years of the
23loan a reduced rate of interest on deposits of State moneys,
24(ii) existing home loans of Illinois citizens who have failed
25to make payments on a home loan as a result of a financial
26hardship due to circumstances beyond the control of the

 

 

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1borrower where there is a reasonable prospect that the borrower
2will be able to resume full mortgage payments, and (iii) loans
3in amounts that do not exceed the amount of arrearage on a
4mortgage and that are extended to enable a borrower to become
5current on his or her mortgage obligation.
6    The following factors shall be considered by the
7participating financial institution to determine whether the
8financial hardship is due to circumstances beyond the control
9of the borrower: (i) loss, reduction, or delay in the receipt
10of income because of the death or disability of a person who
11contributed to the household income, (ii) expenses actually
12incurred related to the uninsured damage or costly repairs to
13the mortgaged premises affecting its habitability, (iii)
14expenses related to the death or illness in the borrower's
15household or of family members living outside the household
16that reduce the amount of household income, (iv) loss of income
17or a substantial increase in total housing expenses because of
18divorce, abandonment, separation from a spouse, or failure to
19support a spouse or child, (v) unemployment or underemployment,
20(vi) loss, reduction, or delay in the receipt of federal,
21State, or other government benefits, and (vii) participation by
22the homeowner in a recognized labor action such as a strike. In
23determining whether there is a reasonable prospect that the
24borrower will be able to resume full mortgage payments, the
25participating financial institution shall consider factors
26including, but not necessarily limited to the following: (i) a

 

 

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1favorable work and credit history, (ii) the borrower's ability
2to and history of paying the mortgage when employed, (iii) the
3lack of an impediment or disability that prevents reemployment,
4(iv) new education and training opportunities, (v) non-cash
5benefits that may reduce household expenses, and (vi) other
6debts.
7    For the purposes of this Section, "home loan" means a loan,
8other than an open-end credit plan or a reverse mortgage
9transaction, for which (i) the principal amount of the loan
10does not exceed the conforming loan size limit as established
11from time to time by the Federal National Mortgage Association,
12(ii) the borrower is a natural person, (iii) the debt is
13incurred by the borrower primarily for personal, family, or
14household purposes, and (iv) the loan is secured by a mortgage
15or deed of trust on real estate upon which there is located or
16there is to be located a structure designed principally for the
17occupancy of no more than 4 families and that is or will be
18occupied by the borrower as the borrower's principal dwelling.
19    (d) If there is an agreement between the State Treasurer
20and an eligible financial institution that details the use of
21deposited funds, the agreement may not require the gift of
22money, goods, or services to a third party; this provision does
23not restrict the eligible financial institution from
24contracting with third parties in order to carry out the intent
25of the agreement or restrict the State Treasurer from placing
26requirements upon third-party contracts entered into by the

 

 

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1eligible financial institution.
2(Source: P.A. 95-834, eff. 8-15-08.)
 
3    Section 99. Effective date. This Act takes effect upon
4becoming law.