Illinois Compiled Statutes
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30 ILCS 440/3
(30 ILCS 440/3)
For purposes of this Act:
A. "Act" shall mean the Illinois Unemployment Insurance Trust Fund
B. "Benefits" shall have the meaning provided in the Unemployment
C. "Bond" means any type of revenue obligation, including, without
rate, variable rate, auction rate or similar bond, note, certificate, or other
without limitation, an interest rate exchange agreement, an interest rate lock
currency exchange agreement, a forward payment conversion agreement, an
provide payments based on levels of or changes in interest rates or currency
exchange rates, an
agreement to exchange cash flows or a series of payments, an option, put, or
call to hedge
payment, currency, interest rate, or other exposure, payable from and secured
a pledge of
Fund Building Receipts collected pursuant to the Unemployment Insurance Act,
and other earnings upon such amounts held in the Master Bond Fund, to the
the proceedings authorizing the obligation.
D. "Bond Administrative Expenses" means expenses and fees incurred to
and issue, upon a conversion of any of the Bonds from one mode to another and
from taxable to
tax-exempt, the Bonds issued pursuant to this Act, including fees for paying
financial advisors, underwriters, remarketing agents, attorneys and for other
necessary to ensure compliance with applicable state or federal law.
E. "Bond Obligations" means the principal of a Bond and any premium and
on a Bond issued pursuant to this Act, together with any amount owed under a
F. "Credit Agreement" means, without limitation, a loan agreement, a
credit agreement, an agreement establishing a line of credit, a letter of
credit, notes, municipal
bond insurance, standby bond purchase agreements, surety bonds, remarketing
the like, by which the Department may borrow funds to pay or redeem or purchase
and hold its
bonds, agreements for the purchase or remarketing of bonds or any other
enhances the marketability, security, or creditworthiness of a Bond issued
1. Such Credit Agreement shall provide the following:
a. The choice of law for the obligations of a
financial provider may be made for any state of these United States, but the law which shall apply to the Bonds shall be the law of the State of Illinois, and jurisdiction to enforce such Credit Agreement as against the Department shall be exclusively in the courts of the State of Illinois or in the applicable federal court having jurisdiction and located within the State of Illinois.
b. Any such Credit Agreement shall be fully
enforceable as a valid and binding contract as and to the extent provided by applicable law.
2. Without limiting the foregoing, such Credit
Agreement, may include any of the following:
a. Interest rates on the Bonds may vary from time
to time depending upon criteria established by the Director, which may include, without limitation:
(i) A variation in interest rates as may be
necessary to cause the Bonds to be remarketed from time to time at a price equal to their principal amount plus any accrued interest;
(ii) Rates set by auctions; or
(iii) Rates set by formula.
b. A national banking association, bank, trust
company, investment banker or other financial institution may be appointed to serve as a remarketing agent in that connection, and such remarketing agent may be delegated authority by the Department to determine interest rates in accordance with criteria established by the Department.
c. Alternative interest rates or provisions may
apply during such times as the Bonds are held by the financial providers or similar persons or entities providing a Credit Agreement for those Bonds and, during such times, the interest on the Bonds may be deemed not exempt from income taxation under the Internal Revenue Code for purposes of State law, as contained in the Bond Authorization Act, relating to the permissible rate of interest to be borne thereon.
d. Fees may be paid to the financial providers or
similar persons or entities providing a Credit Agreement, including all reasonably related costs, including therein costs of enforcement and litigation (all such fees and costs being financial provider payments) and financial provider payments may be paid, without limitation, from proceeds of the Bonds being the subject of such agreements, or from Bonds issued to refund such Bonds, provided that such financial provider payments shall be made subordinate to the payments on the Bonds.
e. The Bonds need not be held in physical form by
the financial providers or similar persons or entities providing a Credit Agreement when providing funds to purchase or carry the Bonds from others but may be represented in uncertificated form in the Credit Agreement.
f. The debt or obligation of the Department
represented by a Bond tendered for purchase to or otherwise made available to the Department thereupon acquired by either the Department or a financial provider shall not be deemed to be extinguished for purposes of State law until cancelled by the Department or its agent.
g. Such Credit Agreement may provide for
acceleration of the principal amounts due on the Bonds.
G. "Department" means the Illinois Department of
H. "Director" means the Director of the Illinois Department of
I. "Fund Building Rates" are those rates imposed pursuant to Section
1506.3 of the
Unemployment Insurance Act.
J. "Fund Building Receipts" shall have the meaning provided in the
Insurance Act and includes earnings on such receipts.
K. "Master Bond Fund" shall mean, for any particular issuance of Bonds
Act, the fund established for the deposit of Fund Building Receipts upon or
prior to the issuance
of Bonds under this Act, and during the time that any Bonds are outstanding
under this Act and from
payment of Bond Obligations and the related Bond Administrative Expenses
connection with such Bonds shall be made. That portion of the Master Bond
containing the Required Fund Building Receipts Amount shall be irrevocably
pledged to the
timely payment of Bond Obligations and Bond Administrative Expenses due on any
issued pursuant to this Act and any Credit Agreement entered in connection with
The Master Bond Fund shall be held separate and apart from all other
Moneys in the Master Bond Fund shall not be commingled with other State
funds, but they
shall be deposited as required by law and maintained in a separate account on
the books of a
savings and loan association, bank or other qualified financial institution.
All interest earnings on amounts within
the Master Bond
Fund shall accrue to the Master Bond Fund.
The Master Bond Fund may include such funds and accounts as are necessary
deposit of bond proceeds, Fund Building Receipts, payment of principal,
expenses, costs of issuance, in the case of bonds which are exempt from Federal
payments, and such other funds and accounts which may be necessary for the
and administration of this Act.
The Director shall be liable on her or his general official bond for the
performance of her or his duties as custodian of the Master Bond Fund. Such
her or his official bond shall exist in addition to the liability upon any
bond given by
her or him. All sums recovered for losses sustained by the Master Bond Fund
be deposited into
The Director shall report quarterly in writing to the Employment Security
Advisory Board concerning the
anticipated deposits into and expenditures and transfers made from the Master
Notwithstanding any other provision to the contrary, no report is required under this subsection K if (i) the Master Bond Fund held a net balance of zero as of the close of the immediately preceding calendar quarter, (ii) there have been no deposits into the Master Bond Fund within any of the immediately preceding 4 calendar quarters, and (iii) there have been no expenditures or transfers from the Master Bond Fund within any of the immediately preceding 4 calendar quarters.
L. "Required Fund Building Receipts Amount" means the aggregate amount of
Building Receipts required to be maintained in the Master Bond Fund as set
in Section 4I
of this Act.
(Source: P.A. 97-621, eff. 11-18-11.)