103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB4921

 

Introduced 2/7/2024, by Rep. Lindsey LaPointe

 

SYNOPSIS AS INTRODUCED:
 
65 ILCS 95/11  from Ch. 24, par. 1611

    Amends the Home Equity Assurance Act. In provisions authoring a governing commission with no less than $4,000,000 in its guarantee fund to establish a Low Interest Home Improvement Loan Program, provides that the loan may be used for repair or maintenance of a guaranteed residence's water and sewer pipes and repair of a guaranteed residence, including, but not limited to, basement repairs, following flooding damage or other natural disaster damage to the property (rather than following flooding damage to the property). Provides that a commission may use loan funds to issue a grant or rebate for repairs, maintenance, remodeling, alteration, or improvement of a guaranteed residence for purposes of preventing or repairing damage as a result of a natural disaster, including, but not limited to, flooding.


LRB103 37586 AWJ 67712 b

 

 

A BILL FOR

 

HB4921LRB103 37586 AWJ 67712 b

1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Home Equity Assurance Act is amended by
5changing Section 11 as follows:
 
6    (65 ILCS 95/11)  (from Ch. 24, par. 1611)
7    Sec. 11. Guarantee Fund.
8    (a) Each governing commission and program created by
9referendum under the provisions of this Act shall maintain a
10guarantee fund for the purposes of paying the costs of
11administering the program and extending protection to members
12pursuant to the limitations and procedures set forth in this
13Act.
14    (b) The guarantee fund shall be raised by means of an
15annual tax levied on all residential property within the
16territory of the program having at least one, but not more than
176 dwelling units and classified by county ordinance as
18residential. The rate of this tax may be changed from year to
19year by majority vote of the governing commission but in no
20case shall it exceed a rate of .12% of the equalized assessed
21valuation of all property in the territory of the program
22having at least one, but not more than 6 dwelling units and
23classified by county ordinance as residential, or the maximum

 

 

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1tax rate approved by the voters of the territory at the
2referendum which created the program or, in the case of a
3merged program, the maximum tax rate approved by the voters at
4the referendum authorizing the merger, whichever rate is
5lower. The commissioners shall cause the amount to be raised
6by taxation in each year to be certified to the county clerk in
7the manner provided by law, and any tax so levied and certified
8shall be collected and enforced in the same manner and by the
9same officers as those taxes for the purposes of the county and
10city within which the territory of the commission is located.
11Any such tax, when collected, shall be paid over to the proper
12officer of the commission who is authorized to receive and
13receipt for such tax. The governing commission may issue tax
14anticipation warrants against the taxes to be assessed for the
15calendar year in which the program is created and for the first
16full calendar year after the creation of the program.
17    (c) The moneys deposited in the guarantee fund shall, as
18nearly as practicable, be fully and continuously invested or
19reinvested by the governing commission in investment
20obligations which shall be in such amounts, and shall mature
21at such times, that the maturity or date of redemption at the
22option of the holder of such investment obligations shall
23coincide, as nearly as practicable, with the times at which
24monies will be required for the purposes of the program. For
25the purposes of this Section investment obligation shall mean
26direct general municipal, state, or federal obligations which

 

 

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1at the time are legal investments under the laws of this State
2and the payment of principal of and interest on which are
3unconditionally guaranteed by the governing body issuing them.
4    (d) Except as permitted by this subsection and subsection
5(d-5), the guarantee fund shall be used solely and exclusively
6for the purpose of providing guarantees to members of the
7particular Guaranteed Home Equity Program and for reasonable
8salaries, expenses, bills, and fees incurred in administering
9the program, and shall be used for no other purpose.
10    A governing commission, with no less than $4,000,000 in
11its guarantee fund, may, if authorized (i) by referendum duly
12adopted by a majority of the voters or (ii) by resolution of
13the governing commission upon approval by two-thirds of the
14commissioners, establish a Low Interest Home Improvement Loan
15Program in accordance with and subject to procedures
16established by a financial institution, as defined in the
17Illinois Banking Act. Whenever the question of creating a Low
18Interest Home Improvement Loan Program is initiated by
19resolution or ordinance of the corporate authorities of the
20municipality or by a petition signed by not less than 10% of
21the total number of registered voters of each precinct in the
22territory, the registered voters of which are eligible to sign
23the petition, it shall be the duty of the election authority
24having jurisdiction over the municipality to submit the
25question of creating the program to the electors of each
26precinct within the territory at the regular election

 

 

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1specified in the resolution, ordinance, or petition initiating
2the question. A petition initiating a question described in
3this subsection shall be filed with the election authority
4having jurisdiction over the municipality. The petition shall
5be filed and objections to the petition shall be made in the
6manner provided in the Election Code. A resolution, ordinance,
7or petition initiating a question described in this subsection
8shall specify the election at which the question is to be
9submitted. The referendum on the question shall be held in
10accordance with the Election Code. The question shall be in
11substantially the following form:
12        "Shall the (name of the home equity program) implement
13    a Low Interest Home Improvement Loan Program with money
14    from the guarantee fund of the established guaranteed home
15    equity program?"
16The votes must be recorded as "Yes" or "No".
17    Whenever a majority of the voters on the public question
18approve the creation of the program as certified by the proper
19election authorities or a resolution of the governing
20commission is approved by a two-thirds majority, the
21commission shall establish the program and administer the
22program with funds collected under the Guaranteed Home Equity
23Program, subject to the following conditions:
24        (1) At any given time, the cumulative total of all
25    loans and loan guarantees (if applicable) issued under
26    this program may not reduce the balance of the guarantee

 

 

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1    fund to less than $3,000,000.
2        (2) Only eligible applicants may apply for a loan.
3        (3) The loan must be used for the repair, maintenance,
4    remodeling, alteration, or improvement of a guaranteed
5    residence. This condition is intended to include the
6    repair or maintenance of a guaranteed residence's water
7    and sewer pipes and repair of a guaranteed residence,
8    including, but not limited to, basement repairs, following
9    flooding damage or other natural disaster damage to the
10    property. This condition is not intended to exclude the
11    repair, maintenance, remodeling, alteration, or
12    improvement of a guaranteed residence's landscape. This
13    condition is intended to exclude the demolition of a
14    current residence. This condition is also intended to
15    exclude the construction of a new residence.
16        (4) An eligible applicant may not borrow more than the
17    amount of equity value in his or her residence.
18        (5) A commission must ensure that loans issued are
19    secured with collateral that is at least equal to the
20    amount of the loan or loan guarantee.
21        (6) A commission shall charge an interest rate which
22    it determines to be below the market rate of interest
23    generally available to the applicant.
24        (7) A commission may, by resolution, establish other
25    administrative rules and procedures as are necessary to
26    implement this program including, but not limited to, loan

 

 

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1    dollar amounts and terms. A commission may also impose on
2    loan applicants a one-time application fee for the purpose
3    of defraying the costs of administering the program.
4        (8) A commission may use loan funds to issue a grant or
5    rebate for repairs, maintenance, remodeling, alteration,
6    or improvement of a guaranteed residence for purposes of
7    preventing or repairing damage as a result of a natural
8    disaster, including, but not limited to, flooding.
9    (d-5) A governing commission, with no less than $4,000,000
10in its guarantee fund, may, if authorized by referendum duly
11adopted by a majority of the voters, establish a Foreclosure
12Prevention Loan Fund to provide low interest emergency loans
13to eligible applicants that may be forced into foreclosure
14proceedings.
15    Whenever the question of creating a Foreclosure Prevention
16Loan Fund is initiated by resolution or ordinance of the
17corporate authorities of the municipality or by a petition
18signed by not less than 10% of the total number of registered
19voters of each precinct in the territory, the registered
20voters of which are eligible to sign the petition, it shall be
21the duty of the election authority having jurisdiction over
22the municipality to submit the question of creating the
23program to the electors of each precinct within the territory
24at the regular election specified in the resolution,
25ordinance, or petition initiating the question. A petition
26initiating a question described in this subsection shall be

 

 

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1filed with the election authority having jurisdiction over the
2municipality. The petition shall be filed and objections to
3the petition shall be made in the manner provided in the
4Election Code. A resolution, ordinance, or petition initiating
5a question described in this subsection shall specify the
6election at which the question is to be submitted. The
7referendum on the question shall be held in accordance with
8the Election Code. The question shall be in substantially the
9following form:
10    "Shall the (name of the home equity program) implement a
11Foreclosure Prevention Loan Fund with money from the guarantee
12fund of the established guaranteed home equity program?"
13    The votes must be recorded as "Yes" or "No".
14    Whenever a majority of the voters on the public question
15approve the creation of a Foreclosure Prevention Loan Fund as
16certified by the proper election authorities, the commission
17shall establish the program and administer the program with
18funds collected under the Guaranteed Home Equity Program,
19subject to the following conditions:
20        (1) At any given time, the cumulative total of all
21    loans and loan guarantees (if applicable) issued under
22    this program may not exceed $3,000,000.
23        (2) Only eligible applicants may apply for a loan. The
24    Commission may establish, by resolution, additional
25    criteria for eligibility.
26        (3) The loan must be used to assist with preventing

 

 

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1    foreclosure proceedings.
2        (4) An eligible applicant may not borrow more than the
3    amount of equity value in his or her residence.
4        (5) A commission must ensure that loans issued are
5    secured as a second lien on the property.
6        (6) A commission shall charge an interest rate which
7    it determines to be below the market rate of interest
8    generally available to the applicant.
9        (7) A commission may, by resolution, establish other
10    administrative rules and procedures as are necessary to
11    implement this program including, but not limited to,
12    eligibility requirements for eligible applicants, loan
13    dollar amounts, and loan terms.
14        (8) A commission may also impose on loan applicants a
15    one-time application fee for the purpose of defraying the
16    costs of administering the program.
17    (d-10) The Northwest Home Equity Assurance Program may, if
18authorized (i) by referendum approved by a majority of the
19voters or (ii) by resolution of the governing commission upon
20approval by two-thirds of the commissioners, establish a
21Delinquent Tax Repayment Loan Fund to provide low-interest
22emergency loans to eligible applicants.
23    If the question of creating a Delinquent Tax Repayment
24Loan Fund is initiated by resolution or ordinance of the
25corporate authorities of the municipality or by a petition
26signed by not less than 10% of the total number of registered

 

 

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1voters of each precinct in the territory, the registered
2voters of which are eligible to sign the petition, it shall be
3the duty of the election authority having jurisdiction over
4the municipality to submit the question of creating the
5program to the electors of each precinct within the territory
6at the regular election specified in the resolution,
7ordinance, or petition initiating the question. A resolution,
8ordinance, or petition initiating a question described in this
9subsection shall be filed with the election authority having
10jurisdiction over the municipality. The resolution, ordinance,
11or petition shall be filed and objections to the resolution,
12ordinance, or petition shall be made in the manner provided in
13the Election Code. A resolution, ordinance, or petition
14initiating a question described in this subsection shall
15specify the election at which the question is to be submitted.
16The referendum on the question shall be held in accordance
17with the Election Code. The question shall be in substantially
18the following form:
19        "Shall the (name of the home equity program) implement
20    a Delinquent Tax Repayment Loan Fund with money from the
21    guarantee fund of the Northwest Home Equity Assurance
22    Program?"
23        The votes must be recorded as "Yes" or "No".
24    If a majority of the voters on the question approve the
25creation of a Delinquent Tax Repayment Loan Fund as certified
26by the proper election authorities or two-thirds of the

 

 

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1commissioners, by resolution, approve the creation of a
2Delinquent Tax Repayment Loan Fund, the commission shall
3establish the program and administer the program with funds
4collected under the program, subject to the following
5conditions:
6        (1) At any given time, the cumulative total of all
7    loans and loan guarantees (if applicable) issued under
8    this program may not exceed $3,000,000.
9        (2) Only eligible applicants may apply for a loan. The
10    commission may establish, by resolution, additional
11    criteria for eligibility.
12        (3) The loan must be used to assist with repayment of
13    delinquent property taxes and for those facing imminent
14    delinquency.
15        (4) An eligible applicant may not borrow more than the
16    amount due to the treasurer's office.
17        (5) A commission shall charge an interest rate which
18    it determines to be below the market rate of interest
19    generally available to the applicant.
20        (6) A commission may, by resolution, establish other
21    administrative rules and procedures as are necessary to
22    implement this program including, but not limited to,
23    eligibility requirements for eligible applicants, loan
24    dollar amounts, and loan terms.
25        (7) Where practicable, it shall be required that a
26    borrower obtain free housing counseling services prior to

 

 

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1    applying to this tax program for the purpose of assisting
2    with budgeting and providing a recommendation as to
3    whether this client is suited for this program.
4        (8) A commission may also impose on loan applicants a
5    one-time application fee for the purpose of defraying the
6    costs of administering the program.
7    (e) The guarantee fund shall be maintained, invested, and
8expended exclusively by the governing commission of the
9program for whose purposes it was created. Under no
10circumstance shall the guarantee fund be used by any person or
11persons, governmental body, or public or private agency or
12concern other than the governing commission of the program for
13whose purposes it was created. Under no circumstances shall
14the guarantee fund be commingled with other funds or
15investments.
16    (e-1) No commissioner or family member of a commissioner,
17or employee or family member of an employee, may receive any
18financial benefit, either directly or indirectly, from the
19guarantee fund. Nothing in this subsection (e-1) shall be
20construed to prohibit payment of expenses to a commissioner in
21accordance with Section 4 or payment of salaries or expenses
22to an employee in accordance with this Section.
23    As used in this subsection (e-1), "family member" means a
24spouse, child, stepchild, parent, brother, or sister of a
25commissioner or a child, stepchild, parent, brother, or sister
26of a commissioner's spouse.

 

 

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1    (f) An independent audit of the guarantee fund and the
2management of the program shall be conducted annually and made
3available to the public through any office of the governing
4commission or a public facility such as a local public library
5located within the territory of the program.
6(Source: P.A. 102-599, eff. 1-1-22.)