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91_HB0943eng HB0943 Engrossed LRB9101953PTpk 1 AN ACT to amend the Home Equity Assurance Act by changing 2 Section 11. 3 Be it enacted by the People of the State of Illinois, 4 represented in the General Assembly: 5 Section 5. The Home Equity Assurance Act is amended by 6 changing Section 11 as follows: 7 (65 ILCS 95/11) (from Ch. 24, par. 1611) 8 Sec. 11. Guarantee Fund. 9 (a) Each governing commission and program created by 10 referendum under the provisions of this Act shall maintain a 11 guarantee fund for the purposes of paying the costs of 12 administering the program and extending protection to members 13 pursuant to the limitations and procedures set forth in this 14 Act. 15 (b) The guarantee fund shall be raised by means of an 16 annual tax levied on all residential property within the 17 territory of the program having at least one, but not more 18 than 6 dwelling units and classified by county ordinance as 19 residential. The rate of this tax may be changed from year 20 to year by majority vote of the governing commission but in 21 no case shall it exceed a rate of .12% of the equalized 22 assessed valuation of all property in the territory of the 23 program having at least one, but not more than 6 dwelling 24 units and classified by county ordinance as residential, or 25 the maximum tax rate approved by the voters of the territory 26 at the referendum which created the program or, in the case 27 of a merged program, the maximum tax rate approved by the 28 voters at the referendum authorizing the merger, whichever 29 rate is lower. The commissioners shall cause the amount to 30 be raised by taxation in each year to be certified to the 31 county clerk in the manner provided by law, and any tax so HB0943 Engrossed -2- LRB9101953PTpk 1 levied and certified shall be collected and enforced in the 2 same manner and by the same officers as those taxes for the 3 purposes of the county and city within which the territory of 4 the commission is located. Any such tax, when collected, 5 shall be paid over to the proper officer of the commission 6 who is authorized to receive and receipt for such tax. The 7 governing commission may issue tax anticipation warrants 8 against the taxes to be assessed for the calendar year in 9 which the program is created and for the first full calendar 10 year after the creation of the program. 11 (c) The moneys deposited in the guarantee fund shall, as 12 nearly as practicable, be fully and continuously invested or 13 reinvested by the governing commission in investment 14 obligations which shall be in such amounts, and shall mature 15 at such times, that the maturity or date of redemption at the 16 option of the holder of such investment obligations shall 17 coincide, as nearly as practicable, with the times at which 18 monies will be required for the purposes of the program. For 19 the purposes of this Section investment obligation shall mean 20 direct general municipal, state, or federal obligations which 21 at the time are legal investments under the laws of this 22 State and the payment of principal of and interest on which 23 are unconditionally guaranteed by the governing body issuing 24 them. 25 (d) Except as permitted by this subsection, the 26 guarantee fund shall be used solely and exclusively for the 27 purpose of providing guarantees to members of the particular 28 Guaranteed Home Equity Program and for reasonable salaries, 29 expenses, bills, and fees incurred in administering the 30 program, and shall be used for no other purpose. 31 A governing commission, with no less than $4,000,000 in 32 its guarantee fund, may by resolution, duly adopted by a 33 majority of the governing commission, establish a Low 34 Interest Home Improvement Loan Program. The program shall be HB0943 Engrossed -3- LRB9101953PTpk 1 administered with funds collected under the Guaranteed Home 2 Equity Program, subject to the following conditions: 3 (1) At any given time, the cumulative total of all 4 loans and loan guarantees (if applicable) issued under 5 this program may not exceed one-quarter of the aggregate 6 balance of the taxes collected under the Guaranteed Home 7 Equity Program. 8 (2) Only eligible applicants may apply for a loan. 9 (3) The loan must be used for the repair, 10 maintenance, remodeling, alteration, or improvement of a 11 guaranteed residence. This condition is not intended to 12 exclude the repair, maintenance, remodeling, alteration, 13 or improvement of a guaranteed residence's landscape. 14 This condition is intended to exclude the demolition of a 15 current residence. This condition is also intended to 16 exclude the construction of a new residence. 17 (4) An eligible applicant may not borrow more than 18 the amount of equity value in his or her residence, but 19 may participate in the loan program more than once, as 20 long as the total amount that the individual owes does 21 not exceed the equity value of his or her residence. 22 (5) A commission must ensure that loans issued are 23 secured with collateral that is at least equal to the 24 amount of the loan or loan guarantee. 25 (6) A commission shall charge an interest rate 26 which it determines to be below the market rate of 27 interest generally available to the applicant. 28 (7) A commission may, by resolution, establish 29 other administrative rules and procedures as are 30 necessary to implement this program including, but not 31 limited to, loan dollar amounts and terms. A commission 32 may also impose on loan applicants a one-time application 33 fee for the purpose of defraying the costs of 34 administering the program. HB0943 Engrossed -4- LRB9101953PTpk 1 (e) The guarantee fund shall be maintained, invested, 2 and expended exclusively by the governing commission of the 3 program for whose purposes it was created. Under no 4 circumstance shall the guarantee fund be used by any person 5 or persons, governmental body, or public or private agency or 6 concern other than the governing commission of the program 7 for whose purposes it was created. Under no circumstances 8 shall the guarantee fund be commingled with other funds or 9 investments. 10 (e-1) No commissioner or family member of a 11 commissioner, or employee or family member of an employee, 12 may receive any financial benefit, either directly or 13 indirectly, from the guarantee fund. Nothing in this 14 subsection (e-1) shall be construed to prohibit payment of 15 expenses to a commissioner in accordance with Section 4 or 16 payment of salaries or expenses to an employee in accordance 17 with this Section. 18 As used in this subsection (e-1), "family member" means a 19 spouse, child, stepchild, parent, brother, or sister of a 20 commissioner or a child, stepchild, parent, brother, or 21 sister of a commissioner's spouse. 22 (f) An independent audit of the guarantee fund and the 23 management of the program shall be conducted annually and 24 made available to the public through any office of the 25 governing commission or a public facility such as a local 26 public library located within the territory of the program. 27 (Source: P.A. 88-439.)