[ Search ] [ Legislation ]
[ Home ] [ Back ] [ Bottom ]
| [ Engrossed ] | [ Enrolled ] |
91_HB2784
LRB9105804LDmb
1 AN ACT to amend the Grain Code by changing Sections 1-10,
2 1-15, 5-30, 10-10, 10-15, 10-25, 25-10, 25-20, and 30-5.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Grain Code is amended by changing
6 Sections 1-10, 1-15, 5-30, 10-10, 10-15, 10-25, 25-10, 25-20,
7 and 30-5 as follows:
8 (240 ILCS 40/1-10)
9 Sec. 1-10. Definitions. As used in this Act:
10 "Board" means the governing body of the Illinois Grain
11 Insurance Corporation.
12 "Certificate" means a document, other than the license,
13 issued by the Department that certifies that a grain dealer's
14 license has been issued and is in effect.
15 "Claimant" means:
16 (a) a person, including, without limitation, a lender:
17 (1) who possesses warehouse receipts issued from an
18 Illinois location covering grain owned or stored by a
19 failed warehouseman; or
20 (2) who has other written evidence of a storage
21 obligation of a failed warehouseman issued from an
22 Illinois location in favor of the holder, including, but
23 not limited to, scale tickets, settlement sheets, and
24 ledger cards; or
25 (3) who has loaned money to a warehouseman and was
26 to receive a warehouse receipt issued from an Illinois
27 location as security for that loan, who surrendered
28 warehouse receipts as part of a grain sale at an Illinois
29 location, or who delivered grain out of storage with the
30 warehouseman as part of a grain sale at an Illinois
31 location; and
-2- LRB9105804LDmb
1 (i) the grain dealer or warehouseman failed
2 within 21 days after the loan of money, the
3 surrender of warehouse receipts, or the delivery of
4 grain, as the case may be, and no warehouse receipt
5 was issued or payment in full was not made on the
6 grain sale, as the case may be; or
7 (ii) written notice was given by the person to
8 the Department within 21 days after the loan of
9 money, the surrender of warehouse receipts, or the
10 delivery of grain, as the case may be, stating that
11 no warehouse receipt was issued or payment in full
12 made on the grain sale, as the case may be; or
13 (b) a producer not included in item (a)(3) in the
14 definition of "Claimant" who possesses evidence of the sale
15 at an Illinois location of grain delivered to a failed grain
16 dealer and who was not paid in full.
17 "Class I warehouseman" means a warehouseman who is
18 authorized to issue negotiable and non-negotiable warehouse
19 receipts.
20 "Class II warehouseman" means a warehouseman who is
21 authorized to issue only non-negotiable warehouse receipts.
22 "Code" means the Grain Code.
23 "Collateral" means:
24 (a) irrevocable letters of credit;
25 (b) certificates of deposit;
26 (c) cash or a cash equivalent; or
27 (d) any other property acceptable to the Department to
28 the extent there exists equity in that property. For the
29 purposes of this item (d), "equity" is the amount by which
30 the fair market value of the property exceeds the amount owed
31 to a creditor who has a valid, prior, perfected security
32 interest in or other lien on the property.
33 "Corporation" means the Illinois Grain Insurance
34 Corporation.
-3- LRB9105804LDmb
1 "Daily position record" means a grain inventory
2 accountability record maintained on a daily basis that
3 includes an accurate reflection of changes in grain
4 inventory, storage obligations, company-owned inventory by
5 commodity, and other information that is required by the
6 Department.
7 "Daily grain transaction report" means a record of the
8 daily transactions of a grain dealer showing the amount of
9 all grain received and shipped during each day and the amount
10 on hand at the end of each day.
11 "Date of delivery of grain" means:
12 (a) the date grain is delivered to a grain dealer for
13 the purpose of sale;
14 (b) the date grain is delivered to a warehouseman for
15 the purpose of storage; or
16 (c) in reference to grain in storage with a
17 warehouseman, the date a warehouse receipt representing
18 stored grain is delivered to the issuer of the warehouse
19 receipt for the purpose of selling the stored grain or, if no
20 warehouse receipt was issued:
21 (1) the date the purchase price for stored grain is
22 established; or
23 (2) if sold by price later contract, the date of
24 the price later contract.
25 "Department" means the Illinois Department of
26 Agriculture.
27 "Depositor" means a person who has evidence of a storage
28 obligation from a warehouseman.
29 "Director", unless otherwise provided, means the Illinois
30 Director of Agriculture, or the Director's designee.
31 "Emergency storage" means space measured in bushels and
32 used for a period of time not to exceed 3 months for storage
33 of grain as a consequence of an emergency situation.
34 "Equity assets" means:
-4- LRB9105804LDmb
1 (a) The equity in any property of the licensee or failed
2 licensee, other than grain assets. For purposes of this item
3 (a):
4 (1) "equity" is the amount by which the fair market
5 value of the property exceeds the amount owed to a
6 creditor who has a valid security interest in or other
7 lien on the property that was perfected before the date
8 of failure of the licensee;
9 (2) a creditor is not deemed to have a valid
10 security interest or other lien on property if (i) the
11 property can be directly traced as being from the sale of
12 grain by the licensee or failed licensee; (ii) the
13 security interest was taken as additional collateral on
14 account of an antecedent debt owed to the creditor; and
15 (iii) the security interest or other lien was perfected
16 (A) on or within 90 days before the date of failure of
17 the licensee or (B) when the creditor is a related
18 person, within one year of the date of failure of the
19 licensee.
20 "Failure" means, in reference to a licensee:
21 (a) a formal declaration of insolvency;
22 (b) a revocation of a license;
23 (c) a failure to apply for license renewal, leaving
24 indebtedness to claimants;
25 (d) a denial of license renewal, leaving indebtedness to
26 claimants; or
27 (e) a voluntary surrender of a license, leaving
28 indebtedness to claimants.
29 "Federal warehouseman" means a warehouseman licensed by
30 the United States government under the United States
31 Warehouse Act (7 U.S.C. 241 et seq.).
32 "Fund" means the Illinois Grain Insurance Fund.
33 "Grain" means corn, soybeans, wheat, oats, rye, barley,
34 grain sorghum, canola, buckwheat, flaxseed, edible soybeans,
-5- LRB9105804LDmb
1 and other like agricultural commodities designated by rule.
2 "Grain assets" means:
3 (a) all grain owned and all grain stored by a licensee
4 or failed licensee, wherever located;
5 (b) redeposited grain of a licensee or failed licensee;
6 (c) identifiable proceeds, including, but not limited
7 to, insurance proceeds, received by or due to a licensee or
8 failed licensee resulting from the sale, exchange,
9 destruction, loss, or theft of grain, or other disposition of
10 grain by the licensee or failed licensee; or
11 (d) assets in hedging or speculative margin accounts
12 held by commodity or security exchanges on behalf of a
13 licensee or failed licensee and any moneys due or to become
14 due to a licensee or failed licensee, less any secured
15 financing directly associated with those assets or moneys,
16 from any transactions on those exchanges.
17 For purposes of this Act, storage charges, drying
18 charges, price later contract service charges, and other
19 grain service charges received by or due to a licensee or
20 failed licensee shall not be deemed to be grain assets, nor
21 shall such charges be deemed to be proceeds from the sale or
22 other disposition of grain by a licensee or a failed
23 licensee, or to have been directly or indirectly traceable
24 from, to have resulted from, or to have been derived in whole
25 or in part from, or otherwise related to, the sale or other
26 disposition of grain by the licensee or failed licensee.
27 "Grain dealer" means a person who is licensed by the
28 Department to engage in the business of buying grain from
29 producers.
30 "Grain Indemnity Trust Account" means a trust account
31 established by the Director under Section 40.23 of the Civil
32 Administrative Code of Illinois that is used for the receipt
33 and disbursement of moneys paid from the Fund and proceeds
34 from the liquidation of and collection upon grain assets,
-6- LRB9105804LDmb
1 equity assets, collateral, or guarantees of or relating to
2 failed licensees. The Grain Indemnity Trust Account shall be
3 used to pay valid claims, authorized refunds from the Fund,
4 and expenses incurred in preserving, liquidating, and
5 collecting upon grain assets, equity assets, collateral, and
6 guarantees relating to failed licensees.
7 "Guarantor" means a person who assumes all or part of the
8 obligations of a licensee to claimants.
9 "Guarantee" means a document executed by a guarantor by
10 which the guarantor assumes all or part of the obligations of
11 a licensee to claimants.
12 "Incidental grain dealer" means a grain dealer who
13 purchases grain only in connection with a feed milling
14 operation and whose total purchases of grain from producers
15 during the grain dealer's fiscal year do not exceed $100,000.
16 "Licensed storage capacity" means the maximum grain
17 storage capacity measured in bushels approved by the
18 applicable licensing agency for use by a warehouseman.
19 "Licensee" means a grain dealer or warehouseman who is
20 licensed by the Department and a federal warehouseman that is
21 a participant in the Fund, under subsection (c) of Section
22 30-10.
23 "Official grain standards" means the official grade
24 designations as adopted by the United States Department of
25 Agriculture under the United States Grain Standards Act and
26 regulations adopted under that Act (7 U.S.C. 71 et seq. and 7
27 CFR 810.201 et seq.).
28 "Permanent storage capacity" means the capacity of
29 permanent structures available for storage of grain on a
30 regular and continuous basis and measured in bushels.
31 "Person" means any individual or entity, including, but
32 not limited to, a sole proprietorship, a partnership, a
33 corporation, a cooperative, an association, a limited
34 liability company, an estate, or a trust.
-7- LRB9105804LDmb
1 "Price later contract" means a written contract for the
2 sale of grain whereby any part of the purchase price may be
3 established by the seller after delivery of the grain to a
4 grain dealer according to a pricing formula contained in the
5 contract. Title to the grain passes to the grain dealer at
6 the time of delivery. The precise form and the general terms
7 and conditions of the contract shall be established by rule.
8 "Producer" means the owner, tenant, or operator of land
9 who has an interest in and receives all or part of the
10 proceeds from the sale of the grain produced on the land.
11 "Producer protection holding corporation" means a holding
12 corporation to receive, hold title to, and liquidate assets
13 of or relating to a failed licensee, including assets in
14 reference to collateral or guarantees relating to a failed
15 licensee.
16 "Related persons" means affiliates of a licensee, key
17 persons of a licensee, owners of a licensee, and persons who
18 have control over a licensee. For the purposes of this
19 definition:
20 (a) "Affiliate" means a person who has direct or
21 indirect control of a licensee, is controlled by a
22 licensee, or is under common control with a licensee.
23 (b) "Key person" means an officer, a director, a
24 trustee, a partner, a proprietor, a manager, a managing
25 agent, or the spouse of a licensee. An officer or a
26 director of an entity organized or operating as a
27 cooperative, however, shall not be considered to be a
28 "key person".
29 (c) "Owner" means the holder of: over 10% of the
30 total combined voting power of a corporation or over 10%
31 of the total value of shares of all classes of stock of a
32 corporation; over a 10% interest in a partnership; over
33 10% of the value of a trust computed actuarially; or over
34 10% of the legal or beneficial interest in any other
-8- LRB9105804LDmb
1 business, association, endeavor, or entity that is a
2 licensee. For purposes of computing these percentages, a
3 holder is deemed to own stock or other interests in a
4 business entity whether the ownership is direct or
5 indirect.
6 (d) "Control" means the power to exercise authority
7 over or direct the management or policies of a business
8 entity.
9 (e) "Indirect" means an interest in a business held
10 by the holder not through the holder's actual holdings in
11 the business, but through the holder's holdings in other
12 businesses.
13 (f) Notwithstanding any other provision of this
14 Act, the term "related person" does not include a lender,
15 secured party, or other lien holder solely by reason of
16 the existence of the loan, security interest, or lien, or
17 solely by reason of the lender, secured party, or other
18 lien holder having or exercising any right or remedy
19 provided by law or by agreement with a licensee or a
20 failed licensee.
21 "Successor agreement" means an agreement by which a
22 licensee succeeds to the grain obligations of a former
23 licensee.
24 "Temporary storage space" means space measured in bushels
25 and used for 6 months or less for storage of grain on a
26 temporary basis due to a need for additional storage in
27 excess of permanent storage capacity.
28 "Trust account" means the Grain Indemnity Trust Account.
29 "Valid claim" means a claim, submitted by a claimant,
30 whose amount and category have been determined by the
31 Department, to the extent that determination is not subject
32 to further administrative review or appeal.
33 "Warehouse" means a building, structure, or enclosure in
34 which grain is stored for the public for compensation,
-9- LRB9105804LDmb
1 whether grain of different owners is commingled or whether
2 identity of different lots of grain is preserved.
3 "Warehouse receipt" means a receipt for the storage of
4 grain issued by a warehouseman.
5 "Warehouseman" means a person who is licensed:
6 (a) by the Department to engage in the business of
7 storing grain for compensation; or
8 (b) under the United States Warehouse Act who
9 participates in the Fund under subsection (c) of Section
10 30-10.
11 (Source: P.A. 89-287, eff. 1-1-96.)
12 (240 ILCS 40/1-15)
13 Sec. 1-15. Powers and duties of Director. The Director
14 has all powers necessary and proper to fully and effectively
15 execute the provisions of this Code and has the general duty
16 to implement this Code. The Director's powers and duties
17 include, but are not limited to, the following:
18 (1) The Director may, upon application, issue or refuse
19 to issue licenses under this Code, and the Director may
20 extend, renew, reinstate, suspend, revoke, or accept
21 voluntary surrender of licenses under this Code.
22 (2) The Director shall examine and inspect each licensee
23 at least once each calendar year. The Director may inspect
24 the premises used by a licensee at any time. The books,
25 accounts, records, and papers of a licensee are at all times
26 during business hours subject to inspection by the Director.
27 Each licensee may also be required to make reports of its
28 activities, obligations, and transactions that are deemed
29 necessary by the Director to determine whether the interests
30 of producers and the holders of warehouse receipts are
31 adequately protected and safeguarded. The Director may take
32 action or issue orders that in the opinion of the Director
33 are necessary to prevent fraud upon or discrimination against
-10- LRB9105804LDmb
1 producers or depositors by a licensee.
2 (3) The Director may, upon his or her initiative or upon
3 the written verified complaint of any person setting forth
4 facts that if proved would constitute grounds for a refusal
5 to issue or renew a license or for a suspension or revocation
6 of a license, investigate the actions of any person applying
7 for, holding, or claiming to hold a license or any related
8 party of that person.
9 (4) The Director (but not the Director's designee) may
10 issue subpoenas and bring before the Department any person
11 and take testimony either at an administrative hearing or by
12 deposition with witness fees and mileage fees and in the same
13 manner as prescribed in the Code of Civil Procedure. The
14 Director or the Director's designee may administer oaths to
15 witnesses at any proceeding that the Department is authorized
16 by law to conduct. The Director (but not the Director's
17 designee) may issue subpoenas duces tecum to command the
18 production of records relating to a licensee, guarantor,
19 related business, related person, or related party. Subpoenas
20 are subject to the rules of the Department.
21 (5) Notwithstanding other judicial remedies, the
22 Director may file a complaint and apply for a temporary
23 restraining order or preliminary or permanent injunction
24 restraining or enjoining any person from violating or
25 continuing to violate this Code or its rules.
26 (6) The Director shall act as Trustee for the Trust
27 Account, act as Trustee over all collateral, guarantees,
28 grain assets, and equity assets held by the Department for
29 the benefit of claimants, and exercise certain powers and
30 perform related duties under Section 20-5 of this Code and
31 Section 40.23 of the Civil Administrative Code of Illinois,
32 except that the provisions of the Trust and Trustees Act do
33 not apply to the Trust Account or any other trust created
34 under this Code.
-11- LRB9105804LDmb
1 (7) The Director shall personally serve as president of
2 the Corporation.
3 (8) The Director shall collect and deposit all monetary
4 penalties, printer registration fees, funds, and assessments
5 authorized under this Code into the Fund.
6 (9) The Director may initiate any action necessary to
7 pay refunds from the Fund.
8 (10) The Director shall maintain a holding corporation
9 to receive, hold title to, and liquidate assets of or
10 relating to a failed licensee, including assets in reference
11 to collateral or guarantees, and deposit the proceeds into
12 the Fund.
13 (11) The Director may initiate, participate in, or
14 withdraw from any proceedings to liquidate and collect upon
15 grain assets, equity assets, collateral, and guarantees
16 relating to a failed licensee, including, but not limited to,
17 all powers needed to carry out the provisions of Section
18 20-15.
19 (12) The Director, as Trustee or otherwise, may take any
20 action that may be reasonable or appropriate to enforce this
21 Code and its rules.
22 (Source: P.A. 89-287, eff. 1-1-96.)
23 (240 ILCS 40/5-30)
24 Sec. 5-30. Grain Insurance Fund assessments. The
25 Illinois Grain Insurance Fund is established as a
26 continuation of the fund created under the Illinois Grain
27 Insurance Act, now repealed. Licensees and applicants for a
28 new license shall pay assessments as set forth in this
29 Section.
30 (a) Subject to subsection (e) of this Section, a
31 licensee that is newly licensed after the effective date of
32 this Code shall pay an assessment into the Fund for 3
33 consecutive years. Except as provided in item (6) of
-12- LRB9105804LDmb
1 subsection (b) of this Section, the first assessment shall be
2 paid at the time of or before the issuance of a new license,
3 the second assessment shall be paid on or before the first
4 anniversary date of the issuance of the new license, and the
5 third assessment shall be paid on or before the second
6 anniversary date of the issuance of the new license. For a
7 grain dealer, the initial payment of each of the 3
8 assessments shall be based upon the total estimated value of
9 grain purchases by the grain dealer for the applicable year
10 with the final assessment amount determined as set forth in
11 item (6) of subsection (b) of this Section. After the
12 licensee has paid or was required to pay the first 3
13 assessments to the Department for payment into the Fund, the
14 licensee shall be subject to subsequent assessments as set
15 forth in subsection (d) of this Section.
16 (b) Grain dealer assessments.
17 (1) The first assessment for a grain dealer shall
18 be an amount equal to:
19 (A) $0.000145 multiplied by the total value of
20 grain purchases for the grain dealer's first fiscal
21 year as shown in the final financial statement for
22 that year provided to the Department under Section
23 5-20; and
24 (B) $0.000255 multiplied by that portion of
25 the value of grain purchases for the grain dealer's
26 first fiscal year that exceeds the adjusted equity
27 of the licensee multiplied by 20, as shown on the
28 final financial statement for the licensee's first
29 fiscal year provided to the Department under Section
30 5-20.
31 (2) The minimum assessment for the first assessment
32 shall be $1,000 and the maximum shall be $10,000.
33 (3) The second assessment for a grain dealer shall
34 be an amount equal to:
-13- LRB9105804LDmb
1 (A) $0.0000725 multiplied by the total value
2 of grain purchases for the grain dealer's second
3 fiscal year as shown in the final financial
4 statement for that year provided to the Department
5 under Section 5-20; and
6 (B) $0.0001275 multiplied by that portion of
7 the value of grain purchases for the grain dealer's
8 second fiscal year that exceeds the adjusted equity
9 of the licensee multiplied by 20, as shown on the
10 final financial statement for the licensee's second
11 fiscal year provided to the Department under Section
12 5-20.
13 (4) The third assessment for a grain dealer shall
14 be an amount equal to:
15 (A) $0.0000725 multiplied by the total value
16 of grain purchases for the grain dealer's third
17 fiscal year as shown in the final financial
18 statement for that year provided to the Department
19 under Section 5-20; and
20 (B) $0.0001275 multiplied by that portion of
21 the value of grain purchases for the grain dealer's
22 third fiscal year that exceeds the adjusted equity
23 of the licensee multiplied by 20, as shown on the
24 final financial statement for the licensee's third
25 fiscal year.
26 (5) The minimum second and third assessments shall
27 be $500 per year and the maximum for each year shall be
28 $5,000.
29 (6) Each of the first 3 assessments shall be
30 adjusted up or down based upon the actual annual grain
31 purchases for each year as shown in the final financial
32 statement for that year provided to the Department under
33 Section 5-20. The adjustments shall be determined by the
34 Department within 30 days of the date of approval of
-14- LRB9105804LDmb
1 renewal of a license. Refunds shall be paid out of the
2 Fund within 60 days after the Department's determination.
3 Additional amounts owed for assessments shall be paid as
4 provided in subsection (f) of this Section.
5 (7) For the purposes of grain dealer assessments
6 under subsection (b) of this Section, the total value of
7 grain purchases shall be the total value of first time
8 grain purchases by at Illinois locations from producers.
9 (c) Warehouseman assessments.
10 (1) The first assessment for a warehouseman shall
11 be an amount equal to:
12 (A) $0.00085 multiplied by the total permanent
13 storage capacity of the warehouseman at the time of
14 license issuance; and
15 (B) $0.00099 multiplied by that portion of the
16 permanent storage capacity of the warehouseman at
17 the time of license issuance that exceeds the
18 adjusted equity of the licensee multiplied by 5, all
19 as shown on the final financial statement for the
20 licensee provided to the Department under Section
21 5-10.
22 (2) The minimum assessment for the first assessment
23 shall be $1,000 and the maximum shall be $10,000.
24 (3) The second and third assessments shall be an
25 amount equal to:
26 (A) $0.000425 multiplied by the total
27 permanent storage capacity of the warehouseman at
28 the time of license issuance; and
29 (B) $0.000495 multiplied by that portion of
30 the permanent licensed storage capacity of the
31 warehouseman at the time of license issuance that
32 exceeds the adjusted equity of the licensee
33 multiplied by 5, as shown on the final financial
34 statement for the licensee's last completed fiscal
-15- LRB9105804LDmb
1 year provided to the Department under Section 5-20.
2 (4) The minimum assessment for the second and third
3 assessments shall be $500 per assessment and the maximum
4 for each assessment shall be $5,000.
5 (5) Every warehouseman shall pay an assessment when
6 increasing available permanent storage capacity in an
7 amount equal to $0.001 multiplied by the total number of
8 bushels to be added to permanent storage capacity. The
9 minimum assessment on any increase in permanent storage
10 capacity shall be $50 and the maximum assessment shall be
11 $20,000. The assessment based upon an increase in
12 permanent storage capacity shall be paid at or before the
13 time of approval of the increase in permanent storage
14 capacity. This assessment on the increased permanent
15 storage capacity does not relieve the warehouseman of any
16 assessments as set forth in subsection (d) of this
17 Section.
18 (6) Every warehouseman shall pay an assessment of
19 $0.0005 per bushel when increasing available storage
20 capacity by use of temporary storage space. The minimum
21 assessment on temporary storage space shall be $100. The
22 assessment based upon temporary storage space shall be
23 paid at or before the time of approval of the amount of
24 the temporary storage space. This assessment on the
25 temporary storage space capacity does not relieve the
26 warehouseman of any assessments as set forth in
27 subsection (d) of this Section.
28 (7) Every warehouseman shall pay an assessment of
29 $0.001 per bushel of emergency storage space. The
30 minimum assessment on any emergency storage space shall
31 be $100. The assessment based upon emergency storage
32 space shall be paid at or before the time of approval of
33 the amount of the emergency storage space. This
34 assessment on the emergency storage space does not
-16- LRB9105804LDmb
1 relieve the warehouseman of any assessments as set forth
2 in subsection (d) of this Section.
3 (d) Subsequent assessments.
4 (1) If the equity in the Fund is below $3,000,000
5 on September 1st of any year, every grain dealer who has,
6 or was required to have, already paid the first, second,
7 and third assessments shall be assessed by the Department
8 an amount equal to:
9 (A) $0.0000725 multiplied by the total value
10 of grain purchases for the grain dealer's last
11 completed fiscal year as shown in the final
12 financial statement for that year provided to the
13 Department under Section 5-20; and
14 (B) $0.0001275 multiplied by that portion of
15 the value of grain purchases for the grain dealer's
16 last completed fiscal year that exceeds the adjusted
17 equity of the licensee multiplied by 20, as shown on
18 the final financial statement for the licensee's
19 last completed fiscal year provided to the
20 Department under Section 5-20.
21 The minimum amount for a subsequent assessment shall
22 be $500 per year and the maximum amount shall be $5,000
23 per year. For the purposes of grain dealer assessments
24 under this item (1) of subsection (d) of this Section,
25 the total value of grain purchases shall be the total
26 value of first time grain purchases by of Illinois
27 locations from producers.
28 (2) If the equity in the Fund is below $3,000,000
29 on September 1st of any year, every warehouseman who has,
30 or was required to have, already paid the first, second,
31 and third assessments shall be assessed by the Department
32 an amount equal to:
33 (A) $0.000425 multiplied by the total licensed
34 storage capacity of the warehouseman as of September
-17- LRB9105804LDmb
1 1st of that year; and
2 (B) $0.000495 multiplied by that portion of
3 the licensed storage capacity of the warehouseman as
4 of September 1st of that year that exceeds the
5 adjusted equity of the licensee multiplied by 5, as
6 shown on the final financial statement for the
7 licensee's last completed fiscal year provided to
8 the Department under Section 5-20.
9 The minimum amount for a subsequent assessment shall
10 be $500 per year and the maximum amount shall be $5,000
11 per year.
12 (3) If the due date for the payment by a licensee
13 of the third assessment is after September 1st in a year
14 when the equity in the Fund is below $3,000,000, that
15 licensee shall not be subject to a subsequent assessment
16 for that year.
17 (e) Newly licensed; exemptions.
18 (1) For the purpose of assessing fees for the Fund
19 under subsection (a) of this Section, and subject to the
20 provisions of item (e)(2) of this Section, the Department
21 shall consider the following to be newly licensed:
22 (A) A person that becomes a licensee for the
23 first time after the effective date of this Code.
24 (B) A licensee who has a lapse in licensing of
25 more than 30 days. A license shall not be
26 considered to be lapsed after its revocation or
27 termination if an administrative or judicial action
28 is pending or if an order from an administrative or
29 judicial body continues an existing license.
30 (C) A grain dealer that is a general
31 partnership in which there is a change in
32 partnership interests and that change is greater
33 than 50% during the partnership's fiscal year.
34 (D) A grain dealer that is a limited
-18- LRB9105804LDmb
1 partnership in which there is a change in the
2 controlling interest of a general partner and that
3 change is greater than 50% of the total controlling
4 interest during the limited partnership's fiscal
5 year.
6 (E) A grain dealer that is a limited liability
7 company in which there is a change in membership
8 interests and that change is greater than 50% during
9 the limited liability company's fiscal year.
10 (F) A grain dealer that is the result of a
11 statutory consolidation if that person has adjusted
12 equity of less than 90% of the combined adjusted
13 equity of the predecessor persons who consolidated.
14 For the purposes of this paragraph, the adjusted
15 equity of the resulting person shall be determined
16 from the approved or certified financial statement
17 submitted to the Department for the first fiscal
18 year of the resulting person. For the purpose of
19 this paragraph, the combined adjusted equity of the
20 predecessor persons shall be determined by combining
21 the adjusted equity of each predecessor person as
22 set forth in the most recent approved or certified
23 financial statement of each predecessor person
24 submitted to the Department.
25 (G) A grain dealer that is the result of a
26 statutory merger if that person has adjusted equity
27 of less than 90% of the combined adjusted equity of
28 the predecessor persons who merged. For the
29 purposes of this paragraph, the adjusted equity of
30 the resulting person shall be determined from the
31 approved or certified financial statement submitted
32 to the Department for the first fiscal year of the
33 resulting person ending after the merger. For the
34 purposes of this paragraph, the combined adjusted
-19- LRB9105804LDmb
1 equity of the predecessor persons shall be
2 determined by combining the adjusted equity of each
3 predecessor person as set forth in the most recent
4 approved or certified financial statement submitted
5 to the Department for the last fiscal year of each
6 predecessor person ending on the date of or before
7 the merger.
8 (H) A grain dealer that is a general
9 partnership in which there is a change in
10 partnership interests and that change is 50% or less
11 during the partnership's fiscal year if the adjusted
12 equity of the partnership after the change is less
13 than 90% of the adjusted equity of the partnership
14 before the change. For the purpose of this
15 paragraph, the adjusted equity of the partnership
16 after the change shall be determined from the
17 approved or certified financial statement submitted
18 to the Department for the first fiscal year ending
19 after the change. For the purposes of this
20 paragraph, the adjusted equity of the partnership
21 before the change shall be determined from the
22 approved or certified financial statement submitted
23 to the Department for the last fiscal year of the
24 partnership ending on the date of or before the
25 change.
26 (I) A grain dealer that is a limited
27 partnership in which there is a change in the
28 controlling interest of a general partner and that
29 change is 50% or less of the total controlling
30 interest during the partnership's fiscal year if the
31 adjusted equity of the partnership after the change
32 is less than 90% of the adjusted equity of the
33 partnership before the change. For the purposes of
34 this paragraph, the adjusted equity of the
-20- LRB9105804LDmb
1 partnership after the change shall be determined
2 from the approved or certified financial statement
3 submitted to the Department for the first fiscal
4 year ending after the change. For the purposes of
5 this paragraph, the adjusted equity of the
6 partnership before the change shall be determined
7 from the approved or certified financial statement
8 submitted to the Department for the last fiscal year
9 of the partnership ending on the date of or before
10 the change.
11 (J) A grain dealer that is a limited liability
12 company in which there is a change in membership
13 interests and that change is 50% or less of the
14 total membership interests during the limited
15 liability company's fiscal year if the adjusted
16 equity of the limited liability company after the
17 change is less than 90% of the adjusted equity of
18 the limited liability company before the change.
19 For the purposes of this paragraph, the adjusted
20 equity of the limited liability company after the
21 change shall be determined from the approved or
22 certified financial statement submitted to the
23 Department for the first fiscal year ending after
24 the change. For the purposes of this paragraph, the
25 adjusted equity of the limited liability company
26 before the change shall be determined from the
27 approved or certified financial statement submitted
28 to the Department for the last fiscal year of the
29 limited liability company ending on the date of or
30 before the change.
31 (K) A grain dealer that is the result of a
32 statutory consolidation or merger if one or more of
33 the predecessor persons that consolidated or merged
34 into the resulting grain dealer was not a licensee
-21- LRB9105804LDmb
1 under this Code at the time of the consolidation or
2 merger.
3 (2) For the purpose of assessing fees for the Fund
4 as set forth in subsection (a) of this Section, the
5 Department shall consider the following as not being
6 newly licensed and, therefore, exempt from further
7 assessment unless an assessment is required by subsection
8 (d) of this Section:
9 (A) A person resulting solely from a name
10 change of a licensee.
11 (B) A warehouseman changing from a Class I
12 warehouseman to a Class II warehouseman or from a
13 Class II warehouseman to a Class I warehouseman
14 under this Code.
15 (C) A licensee that becomes a wholly owned
16 subsidiary of another licensee.
17 (D) Subject to item (e)(1)(K) of this Section,
18 a person that is the result of a statutory
19 consolidation if that person has adjusted equity
20 greater than or equal to 90% of the combined
21 adjusted equity of the predecessor persons who
22 consolidated. For the purposes of this paragraph,
23 the adjusted equity of the resulting person shall be
24 determined from the approved or certified financial
25 statement submitted to the Department for the first
26 fiscal year of the resulting person. For the
27 purpose of this paragraph, the combined adjusted
28 equity of the predecessor persons shall be
29 determined by combining the net worth of each
30 predecessor person as set forth in the most recent
31 approved or certified financial statement of each
32 predecessor person submitted to the Department.
33 (E) Subject to item (e)(1)(K) of this Section,
34 a person that is the result of a statutory merger if
-22- LRB9105804LDmb
1 that person has adjusted equity greater than or
2 equal to 90% of the combined adjusted equity of the
3 predecessor persons who merged. For the purposes of
4 this paragraph, the adjusted equity of the resulting
5 person shall be determined from the approved or
6 certified financial statement submitted to the
7 Department for the first fiscal year of the
8 resulting person ending after the merger. For the
9 purposes of this paragraph, the combined adjusted
10 equity of the predecessor persons shall be
11 determined by combining the adjusted equity of each
12 predecessor person as set forth in the most recent
13 approved or certified financial statement, submitted
14 to the Department for the last fiscal year of each
15 predecessor person ending on the date of or before
16 the merger.
17 (F) A general partnership in which there is a
18 change in partnership interests and that change is
19 50% or less during the partnership's fiscal year and
20 the adjusted equity of the partnership after the
21 change is greater than or equal to 90% of the
22 adjusted equity of the partnership before the
23 change. For the purposes of this paragraph, the
24 adjusted equity of the partnership after the change
25 shall be determined from the approved or certified
26 financial statement submitted to the Department for
27 the first fiscal year ending after the change. For
28 the purposes of this paragraph, the adjusted equity
29 of the partnership before the change shall be
30 determined from the approved or certified financial
31 statement submitted to the Department for the last
32 fiscal year of the partnership ending on the date of
33 or before the change.
34 (G) A limited partnership in which there is a
-23- LRB9105804LDmb
1 change in the controlling interest of a general
2 partner and that change is 50% or less of the total
3 controlling interest during the partnership's fiscal
4 year and the adjusted equity of the partnership
5 after the change is greater than or equal to 90% of
6 the adjusted equity of the partnership before the
7 change. For the purposes of this paragraph, the
8 adjusted equity of the partnership after the change
9 shall be determined from the approved or certified
10 financial statement submitted to the Department for
11 the first fiscal year ending after the change. For
12 the purposes of this paragraph, the adjusted equity
13 of the partnership before the change shall be
14 determined from the approved or certified financial
15 statement submitted to the Department for the last
16 fiscal year of the partnership ending on the date of
17 or before the change.
18 (H) A limited liability company in which there
19 is a change in membership interests and that change
20 is 50% or less of the total membership interests
21 during the limited liability company's fiscal year
22 if the adjusted equity of the limited liability
23 company after the change is greater than or equal to
24 90% of the adjusted equity of the limited liability
25 company before the change. For the purposes of this
26 paragraph, the adjusted equity of the limited
27 liability company after the change shall be
28 determined from the approved or certified financial
29 statement submitted to the Department for the first
30 fiscal year ending after the change. For the
31 purposes of this paragraph, the adjusted equity of
32 the limited liability company before the change
33 shall be determined from the approved or certified
34 financial statement submitted to the Department for
-24- LRB9105804LDmb
1 the last fiscal year of the limited liability
2 company ending on the date of or before the change.
3 (I) A licensed warehouseman that is the result
4 of a statutory merger or consolidation to the extent
5 the combined storage capacity of the resulting
6 warehouseman has been assessed under this Code
7 before the statutory merger or consolidation, except
8 that any storage capacity of the resulting
9 warehouseman that has not previously been assessed
10 under this Code shall be assessed as provided in
11 items (c)(5), (c)(6), and (c)(7) of this Section.
12 (J) A federal warehouseman who participated in
13 the Fund under Section 30-10 and who subsequently
14 received an Illinois license to the extent the
15 storage capacity of the warehouseman was assessed
16 under this Code prior to Illinois licensing.
17 (f) Except for the first assessment made under this
18 Section, and assessments under items (c)(5), (c)(6), and
19 (c)(7) of this Section, all assessments shall be paid to the
20 Department within 60 days after the date posted on the
21 written notice of assessment. The Department shall forward
22 all paid assessments to the Fund.
23 (Source: P.A. 89-287, eff. 1-1-96.)
24 (240 ILCS 40/10-10)
25 Sec. 10-10. Duties and requirements of grain dealers.
26 (a) Long and short market position.
27 (1) Grain dealers shall at all times maintain an
28 accurate and current long and short market position
29 record for each grain commodity. The position record
30 shall at a minimum contain the net position of all grain
31 owned, wherever located, grain purchased and sold, and
32 any grain option contract purchased or sold.
33 (2) Grain dealers, except grain dealers regularly
-25- LRB9105804LDmb
1 and continuously reporting to the Commodity Futures
2 Trading Commission or grain dealers who have obtained the
3 permission of the Department to have different open long
4 or short market positions, may maintain an open position
5 in the grain commodity of which the grain dealer buys the
6 greatest number of bushels per fiscal year not to exceed
7 one bushel for each $10 of adjusted equity at fiscal year
8 end up to a maximum open position of 50,000 bushels and
9 one-half that number of bushels up to 25,000 bushels for
10 all other grain commodities that the grain dealer buys. A
11 grain dealer, however, may maintain an open position of
12 up to 5,000 bushels for each grain commodity the grain
13 dealer buys.
14 (b) The license issued by the Department to a grain
15 dealer shall be posted in the principal office of the
16 licensee in this State. A certificate shall be posted in
17 each location where the licensee engages in business as a
18 grain dealer. In the case of a licensee operating a truck or
19 tractor trailer unit for the purpose of purchasing grain, the
20 licensee shall have a certificate carried in each truck or
21 tractor trailer unit used in connection with the licensee's
22 grain dealer business.
23 (c) The licensee must have at all times sufficient
24 financial resources to pay producers on demand for grain
25 purchased from them.
26 (d) A licensee that is solely a grain dealer shall on a
27 daily basis maintain an accurate and current daily grain
28 transaction report.
29 (e) A licensee that is both a grain dealer and a
30 warehouseman shall at all times maintain an accurate and
31 current daily position record.
32 (f) In the case of a change of ownership of a grain
33 dealer, the obligations of a grain dealer do not cease until
34 the grain dealer its successor is properly licensed under
-26- LRB9105804LDmb
1 this Code, it has surrendered all unused price later
2 contracts to the Department and the successor has executed a
3 successor's agreement, or the successor has otherwise
4 provided for the grain obligations of its predecessor.
5 (g) If a grain dealer proposes to cease doing business
6 as a grain dealer and there is no successor, it is the duty
7 of the grain dealer to surrender all unused price later
8 contracts to the Department, together with an affidavit
9 accounting for all grain dealer obligations setting forth the
10 arrangements made with producers for final disposition of the
11 grain dealer obligations and indicating the procedure for
12 payment in full of all outstanding grain obligations. It is
13 the duty of the Department to give notice by publication that
14 a grain dealer has ceased doing business without a successor.
15 After payment in full of all outstanding grain obligations,
16 it is the duty of the grain dealer to surrender its license.
17 (Source: P.A. 89-287, eff. 1-1-96.)
18 (240 ILCS 40/10-15)
19 Sec. 10-15. Price later contracts.
20 (a) Price later contracts shall be written on forms
21 prescribed by the Department. Price later contract forms
22 shall be printed by a person authorized to print those
23 contracts by the Department after that person has agreed to
24 comply with each of the following:
25 (1) That all price later contracts shall be printed
26 as prescribed by the Department and shall be printed
27 only for a licensed grain dealer.
28 (2) That all price later contracts shall be
29 numbered consecutively and a complete record of these
30 contracts shall be retained showing for whom printed and
31 the consecutive numbers printed on the contracts.
32 (3) That a duplicate copy of all invoices rendered
33 for printing price later contracts that will show the
-27- LRB9105804LDmb
1 consecutive numbers printed on the contracts, and the
2 number of contracts printed, shall be promptly forwarded
3 to the Department.
4 (4) that the person shall register with the
5 Department and pay an annual registration fee of $100 to
6 print price later contracts.
7 (b) A grain dealer purchasing grain by price later
8 contract shall at all times own grain, rights in grain,
9 proceeds from the sale of grain, and other assets acceptable
10 to the Department as set forth in this Code totaling 90% of
11 the unpaid balance of the grain dealer's obligations for
12 grain purchased by price later contract. That amount shall
13 at all times remain unencumbered and shall be represented by
14 the aggregate of the following:
15 (1) Grain owned by the grain dealer valued by means
16 of the hedging procedures method that includes marking
17 open contracts to market.
18 (2) Cash on hand.
19 (3) Cash held on account in federally or State
20 licensed financial institutions.
21 (4) Investments held in time accounts with
22 federally or State licensed financial institutions.
23 (5) Direct obligations of the U.S. government.
24 (6) Funds on deposit Balances in grain margin
25 accounts determined by marking to market.
26 (7) Balances due or to become due to the licensee
27 on price later contracts.
28 (8) Marketable securities, including mutual funds.
29 (9) Irrevocable letters of credit in favor of the
30 Department and acceptable to the Department.
31 (10) Price later contract service charges due or to
32 become due to the licensee.
33 (11) Other evidence of proceeds from or of grain
34 that is acceptable to the Department.
-28- LRB9105804LDmb
1 (c) For the purpose of computing the dollar value of
2 grain and the balance due on price later contract
3 obligations, the value of grain shall be figured at the
4 current market price.
5 (d) Title to grain sold by price later contract shall
6 transfer to a grain dealer on the date of delivery of the
7 grain. Therefore, no storage charges shall be made with
8 respect to grain purchased by price later contract. A
9 service charge for handling the contract, however, may be
10 made.
11 (e) Subject to subsection (f) of this Section, if a
12 price later contract is not signed by all parties within 30
13 days of the last date of delivery of grain intended to be
14 sold by price later contract, then the grain intended to be
15 sold by price later contract shall be priced on the next
16 business day after 30 days from the last date of delivery of
17 grain intended to be sold by price later contract at the
18 market price of the grain at the close of the next business
19 day after the 29th day. When the grain is priced under this
20 subsection, the grain dealer shall send notice to the seller
21 of the grain within 10 days. The notice shall contain the
22 number of bushels sold, the price per bushel, all applicable
23 discounts, the net proceeds, and a notice that states that
24 the Grain Insurance Fund shall provide protection for a
25 period of only 160 days from the date of pricing of the
26 grain.
27 (f) If grain is in storage with a warehouseman and is
28 intended to be sold by price later contract, that grain shall
29 be considered as remaining in storage and not be deemed sold
30 by price later contract until the date the price later
31 contract is signed by all parties.
32 (g) Scale tickets or other approved documents with
33 respect to grain purchased by a grain dealer by price later
34 contract shall contain the following: "Sold Grain; Price
-29- LRB9105804LDmb
1 Later".
2 (h) Price later contracts shall be issued consecutively
3 and recorded by the grain dealer as established by rule.
4 (i) A grain dealer shall not issue a collateral
5 warehouse receipt on grain purchased by a price later
6 contract to the extent the purchase price has not been paid
7 by the grain dealer.
8 (j) Failure to comply with the requirements of this
9 Section may result in suspension of the privilege to purchase
10 grain by price later contract for up to one year.
11 (Source: P.A. 89-287, eff. 1-1-96.)
12 (240 ILCS 40/10-25)
13 Sec. 10-25. Warehouse receipts and storage of grain.
14 (a) When grain is delivered to a warehouseman at a
15 location where grain is also purchased, the licensee shall
16 give written evidence of delivery of grain and that written
17 evidence shall be marked to indicate whether the grain is
18 delivered for storage or for sale. In the absence of
19 adequate evidence of sale, the grain shall be construed to be
20 in storage.
21 (b) Upon demand by a depositor, a warehouseman shall
22 issue warehouse receipts for grain delivered into storage.
23 (c) There shall be no charge for the first warehouse
24 receipt issued to a depositor for a given lot of grain.
25 Charges for any additional warehouse receipts for grain
26 previously covered by a warehouse receipt must be
27 commensurate with the cost of issuance of the additional
28 warehouse receipt.
29 (d) A warehouseman shall issue warehouse receipts only
30 in accordance with the following requirements:
31 (1) Warehouse receipts shall be consecutively
32 numbered in a form prescribed by the Department and when
33 issued from the same warehouse shall be consecutively by
-30- LRB9105804LDmb
1 the warehouseman numbered.
2 (2) In the case of a lost or destroyed warehouse
3 receipt, the new warehouse receipt shall bear the same
4 date as the original and shall be plainly marked on its
5 face "duplicate in lieu of lost or destroyed warehouse
6 receipt number .......", and the warehouseman shall duly
7 fill in the blank with the appropriate warehouse receipt
8 number.
9 (3) Warehouse receipts shall be printed by a person
10 authorized printer approved by the Department. The person
11 shall register with the Department and pay an annual
12 registration fee of $100 to print warehouse receipts.
13 (4) Negotiable warehouse receipts shall be issued
14 only for grain actually in storage with the warehouseman
15 from which it is issued or redeposited by that
16 warehouseman as provided in subsection (e) of Section
17 10-20.
18 (5) A warehouseman shall not insert in any
19 negotiable warehouse receipt issued by it any language
20 that in any way limits or modifies its liability or
21 responsibility.
22 (e) Upon delivery of grain covered by a negotiable
23 warehouse receipt, the holder of the negotiable warehouse
24 receipt must surrender the warehouse receipt for
25 cancellation, and a warehouseman must cancel and issue a new
26 negotiable warehouse receipt for the balance of grain in
27 storage.
28 (f) When all grain, the storage of which is evidenced by
29 a warehouse receipt, is delivered from storage, the warehouse
30 receipt shall be plainly marked across its face with the word
31 "cancelled" and shall have written on it the date of
32 cancellation, the name of the person canceling the warehouse
33 receipt, and such other information as required by rule, and
34 is thereafter void.
-31- LRB9105804LDmb
1 (g) When a warehouseman delivers grain out of storage
2 but fails to collect and cancel the negotiable warehouse
3 receipt, the warehouseman shall be liable to any purchaser of
4 the negotiable warehouse receipt for value in good faith for
5 failure to deliver the grain to the purchaser, whether the
6 purchaser acquired the negotiable warehouse receipt before or
7 after the delivery of the grain by the warehouseman. If,
8 however, grain has been lawfully sold by a warehouseman to
9 satisfy its warehouseman's lien, the warehouseman shall not
10 be liable for failure to deliver the grain pursuant to the
11 demands of a holder of a negotiable warehouse receipt to the
12 extent of the amount of grain sold.
13 (h) Except as otherwise provided by this Code or other
14 applicable law, a warehouseman shall deliver the grain upon
15 demand made by the holder of a warehouse receipt pertaining
16 to that grain if the demand is accompanied by:
17 (1) satisfaction of the warehouseman's lien;
18 (2) in the case of a negotiable warehouse receipt,
19 a properly endorsed negotiable warehouse receipt; or
20 (3) in the case of a non-negotiable warehouse
21 receipt, written evidence that the grain was delivered to
22 the warehouseman and that the depositor is entitled to
23 it.
24 (i) If no warehouse receipt is issued to a depositor, a
25 warehouseman shall deliver grain upon the demand of a
26 depositor if the demand is accompanied by satisfaction of the
27 warehouseman's lien and written evidence that the grain was
28 delivered to the warehouseman and the depositor is entitled
29 to it.
30 (j) If a warehouseman refuses or fails to deliver grain
31 in compliance with a demand by a holder of a warehouse
32 receipt or a depositor, the burden is on the warehouseman to
33 establish the existence of a lawful excuse for the refusal.
34 (k) If a warehouse receipt has been lost or destroyed, a
-32- LRB9105804LDmb
1 warehouseman may issue a substitute warehouse receipt, as
2 provided for in this Section, upon delivery to the
3 warehouseman of an affidavit under oath stating that the
4 applicant for the substitute warehouse receipt is entitled to
5 the original warehouse receipt and setting forth the
6 circumstances that resulted in the loss or destruction of the
7 original warehouse receipt. The warehouseman may request
8 from the depositor a bond in double the value of the grain
9 represented by the original warehouse receipt at the time of
10 issuance of the substitute warehouse receipt so as to protect
11 the warehouseman from any liability or expense that it, or
12 any person injured by the delivery, may incur by reason of
13 the original warehouse receipt remaining outstanding.
14 (l) A warehouse receipt that is to be used for
15 collateral purposes by a warehouseman must be first issued by
16 the warehouseman to itself.
17 (m) The Department shall approve temporary storage space
18 in an amount to be determined by the Department if all the
19 following conditions are met:
20 (1) The warehouseman pays all fees and assessments
21 associated with the temporary storage space.
22 (2) The warehouseman demonstrates that there is a
23 need for additional storage on a temporary basis due to a
24 bumper crop or otherwise.
25 (3) The structure for the storage of grain meets
26 all of the following requirements:
27 (A) The grain storage area has a permanent
28 base made of concrete, asphalt, or a material having
29 similar structural qualities.
30 (B) Hot spot detectors, aeration fans, and
31 ducts are provided to assure that the quality of
32 grain in storage is maintained.
33 (C) The grain storage structure has rigid
34 sidewalls made of concrete, wood, metal, or a
-33- LRB9105804LDmb
1 material having similar structural qualities.
2 (D) The grain storage structure is equipped
3 with a waterproof covering of sufficient strength to
4 support a person's weight and with inlets to allow
5 airflow.
6 (E) Access to the grain is provided for the
7 purpose of sampling and making examinations.
8 (4) Temporary storage space shall be considered an
9 increase in the licensed storage capacity of the licensee
10 and shall be subject to Section 5-30.
11 (5) The authorization to use temporary storage
12 space for the storage of grain shall expire at the end of
13 6 months after the date of approval by the Department or
14 May 15th, whichever comes first.
15 (n) The Department may approve emergency storage space
16 at the request of the licensee according to rule.
17 (Source: P.A. 89-287, eff. 1-1-96.)
18 (240 ILCS 40/25-10)
19 Sec. 25-10. Claimant compensation. Within 30 days after
20 the day on which a claim becomes a valid claim, a claimant
21 shall be compensated to the extent of its valid claim in
22 accordance with the following provisions:
23 (a) Valid claims filed by warehouse claimants shall be
24 paid 100% of the amount determined by the Department out of
25 the net proceeds of the liquidation of grain assets as set
26 forth in this subsection (a). To the extent the net proceeds
27 are insufficient, warehouse claimants shall be paid their pro
28 rata share of the net proceeds of the liquidation of grain
29 assets and, subject to subsection (j) of this Section, an
30 additional amount per claimant not to exceed the balance of
31 their respective claims out of the Fund.
32 (b) Subject to subsection (j) of this Section, if the
33 net proceeds as set forth in subsection (a) of this Section
-34- LRB9105804LDmb
1 are insufficient to pay in full all valid claims filed by
2 warehouse claimants as payment becomes due, the balance shall
3 be paid out of the Fund in accordance with subsection (b) of
4 Section 25-20.
5 (c) Valid claims filed by producers who:
6 (1) have delivered grain within 21 days before the
7 date of failure for which pricing of that grain has been
8 completed before date of failure; or
9 (2) gave written notice to the Department within 21
10 days of the date of delivery of grain, if the pricing of
11 that grain has been completed, that payment in full for
12 that grain has not been made;
13 shall be paid, subject to subsection (j) of this Section,
14 100% of the amount of the valid claim determined by the
15 Department. Valid claims that are included in subsection (c)
16 of this Section shall receive no payment under subsection (d)
17 of this Section, and any claimant having a valid claim under
18 this subsection (c) determined by the Department to be in
19 excess of the limits, if any, imposed under subsection (j) of
20 this Section shall be paid only sums in excess of those
21 limits to the extent additional money is available under
22 subsection (d)(2) of Section 25-20.
23 (d) Valid claims that are not included in subsection (c)
24 of this Section that are filed by producers who completed
25 delivery and pricing of grain in reference to the valid
26 claim, whichever is later, within 160 days before the date of
27 failure shall be paid 85% of the amount of the valid claim
28 determined by the Department or $100,000, whichever is less,
29 per claimant. For claims filed by producers for grain sold on
30 a price later contract, however, the later of the date of
31 execution of the contract or the date of delivery of grain in
32 reference to the grain covered by the price later contract
33 must not be more than 270 days before the date of failure in
34 order for the claimant to receive any compensation.
-35- LRB9105804LDmb
1 (e) Valid claims filed by producers for grain sold on a
2 price later contract, for which the final price has not been
3 established, shall be paid 85% of the amount of the valid
4 claims determined by the Department or $100,000, whichever is
5 less, per claimant, if the later of the date of execution of
6 the contract or the date of delivery of grain in reference to
7 the grain covered by the price later contract occurred no
8 more than 270 days before the date of failure. The execution
9 of subsequent price later contracts by the producer and the
10 licensee for grain previously covered by a price later
11 contract shall not extend the coverage of a claim beyond the
12 original 270 days.
13 (f) The maximum payment to producers under subsections
14 (d) and (e) of this Section, combined, shall be $100,000 per
15 claimant.
16 (g) The following claims shall be barred and disallowed
17 in their entirety and shall not be entitled to any recovery
18 from the Fund or the Trust Account:
19 (1) Claims filed by producers who completed pricing
20 of the grain in reference to their claim in excess of 160
21 days before the date of failure.
22 (2) Claims filed by producers for grain sold on a
23 price later contract if the later of the date of
24 execution of the contract or the date of delivery of
25 grain in reference to the grain covered by the price
26 later contract occurred more than 270 days before the
27 date of failure.
28 (h) To the extent moneys are available, additional pro
29 rata payments may be made to claimants under subsection (d)
30 of Section 25-20.
31 (i) For purposes of this Section, a claim filed in
32 connection with warehouse receipts that are possessed under a
33 collateral pledge of a producer, or that are subject to a
34 perfected security interest, or that were acquired by a
-36- LRB9105804LDmb
1 secured party or of lien holder under an obligation of a
2 producer, shall be deemed to be a claim filed by the producer
3 and not a claim filed by the secured party or the lien
4 holder, regardless of whether the producer is in default
5 under that collateral pledge, security agreement, or other
6 obligation.
7 (j) With respect to any failure occurring on or after
8 July 1, 1998, the maximum payment out of the Fund for
9 claimants under subsection (a), (b), or (c) of this Section
10 shall be $1,000,000 per claimant and the maximum payment out
11 of the Fund for claimants under subsections (c), (d), and (e)
12 of this Section, combined, shall be $1,000,000 per claimant.
13 (Source: P.A. 89-287, eff. 1-1-96.)
14 (240 ILCS 40/25-20)
15 Sec. 25-20. Priorities and repayments.
16 (a) All valid claims shall be paid from the Trust
17 Account, as provided in Section 25-10, first from the
18 proceeds realized from liquidation of and collection upon the
19 grain assets relating to the failed licensee, as to warehouse
20 claimants, and the equity assets as to a secured party or
21 lien holder who has consented to the Department liquidating
22 and collecting upon the equity asset as set forth in
23 subsection (f) of Section 20-15, and the remaining equity
24 assets, collateral, and guarantees relating to the failed
25 licensee, as to grain dealer claimants.
26 (b) If the proceeds realized from liquidation of and
27 collection upon the grain assets, equity assets, collateral,
28 and guarantees relating to the failed licensee are
29 insufficient to pay all valid claims as provided in Section
30 25-10 and subsection (a) of this Section as payment on those
31 claims becomes due, the Director shall request from the Board
32 sufficient funds to be transferred from the Fund to the Trust
33 Account to pay the balance owed to claimants as determined
-37- LRB9105804LDmb
1 under Section 25-10. If a request is made by the Director
2 for a transfer of funds to the Trust Account from the Fund,
3 the Board shall act on that request within 25 days after the
4 date of that request. Once moneys are transferred from the
5 Fund to the Trust Account, the Director shall pay the balance
6 owed to claimants in accordance with Section 25-10.
7 (c) Net proceeds from liquidation of grain assets as set
8 forth in subsection (a) of Section 25-10 received by the
9 Department, to the extent not already paid to warehouse
10 claimants, shall be prorated among the fund and all warehouse
11 claimants who have not had their valid claims paid in full.
12 (1) The pro rata distribution to the Fund shall be
13 based upon the total amount of valid claims of all
14 warehouse claimants who have had their valid claims paid
15 in full. The pro rata distribution to each warehouse
16 claimant who has not had his or her valid claims paid in
17 full shall be based upon the total amount of that
18 claimant's original valid claims.
19 (2) If the net proceeds from the liquidation of
20 grain assets as set forth in subsection (a) of Section
21 25-10 exceed all amounts needed to satisfy all valid
22 claims filed by warehouse claimants, the balance
23 remaining shall be paid into the Trust Account or as set
24 forth in subsection (h) (g) of Section 25-20.
25 (d) Subject to subsections (c) and (h) (g) of Section
26 25-20:
27 (1) The proceeds realized from liquidation of and
28 collection upon the grain assets, equity assets,
29 collateral, and guarantees relating to the failed
30 licensee or any other assets relating to the failed
31 licensee that are received by the Department, to the
32 extent not already paid to claimants, shall be first used
33 to repay the Fund for moneys transferred to the Trust
34 Account.
-38- LRB9105804LDmb
1 (2) After the Fund is repaid in full for the moneys
2 transferred from it to pay the valid claims in reference
3 to a failed licensee, any remaining proceeds realized
4 from liquidation of and collection upon the grain assets,
5 equity assets, collateral, and guarantees relating to the
6 failed licensee thereafter received by the Department
7 shall be prorated to the claimants holding valid claims
8 who have not received 100% of the amount of their valid
9 claims based upon the unpaid amount of their valid
10 claims.
11 (e) After all claimants have received 100% of the amount
12 of their valid claims, to the extent moneys are available
13 interest at the rate of 6% per annum shall be assessed and
14 paid to the Fund on all moneys transferred from the Fund to
15 the Trust Account.
16 (f) After the Fund is paid the interest as provided in
17 subsection (e) of this Section, then those claims barred and
18 disallowed under subsection (g) of Section 25-10 shall be
19 paid on a pro rata basis only to the extent that moneys are
20 available.
21 (g) Once all claims become valid claims and have been
22 paid in full and all interest as provided in subsection (e)
23 of this Section is paid in full, and all claims are paid in
24 full under subsection (f), any remaining grain assets, equity
25 assets, collateral, and guarantees, and the proceeds realized
26 from liquidation of and collection upon the grain assets,
27 equity assets, collateral, and guarantees relating to the
28 failed licensee, shall be returned to the failed licensee or
29 its assignee, or as otherwise directed by a court of
30 competent jurisdiction.
31 (h) If amounts in the Fund are insufficient to pay all
32 valid claims, the General Assembly shall appropriate to the
33 Corporation amounts sufficient to satisfy the valid claims.
34 If for any reason the General Assembly fails to make an
-39- LRB9105804LDmb
1 appropriation to satisfy outstanding valid claims, this Code
2 constitutes an irrevocable and continuing appropriation of
3 all amounts necessary for that purpose and the irrevocable
4 and continuing authority for and direction to the State
5 Comptroller and to the State Treasurer to make the necessary
6 transfers and disbursements from the revenues and funds of
7 the State for that purpose. Subject to payments to warehouse
8 claimants as set forth in subsection (c) of Section 25-20,
9 the State shall be reimbursed as soon as funds become
10 available for any amounts paid under subsection (g) of this
11 Section upon replenishment of the Fund from assessments under
12 subsection (d) of Section 5-30 and collection upon grain
13 assets, equity assets, collateral, and guarantees relating to
14 the failed licensee.
15 (i) The Department shall have those rights of equitable
16 subrogation which may result from a claimant receiving from
17 the Fund payment in full of the obligations of the failed
18 licensee to the claimant.
19 (Source: P.A. 89-287, eff. 1-1-96.)
20 (240 ILCS 40/30-5)
21 Sec. 30-5. Illinois Grain Insurance Corporation.
22 (a) The Corporation is a political subdivision, body
23 politic, and public corporation. The governing powers of the
24 Corporation are vested in the Board of Directors composed of
25 the Director, who shall personally serve as president; the
26 Attorney General or his or her designee, who shall serve as
27 secretary; the State Treasurer or his or her designee, who
28 shall serve as treasurer; the Director of the Department of
29 Insurance or his or her designee; and the chief fiscal
30 officer of the Department. Three members of the Board
31 constitute a quorum at any meeting of the Board, and the
32 affirmative vote of 3 members is necessary for any action
33 taken by the Board at a meeting, except that a lesser number
-40- LRB9105804LDmb
1 may adjourn a meeting from time to time. A vacancy in the
2 membership of the Board does not impair the right of a quorum
3 to exercise all the rights and perform all the duties of the
4 Board and Corporation.
5 (b) The Corporation has the following powers, together
6 with all powers incidental or necessary to the discharge of
7 those powers in corporate form:
8 (1) To have perpetual succession by its corporate
9 name as a corporate body.
10 (2) To adopt, alter, and repeal bylaws, not
11 inconsistent with the provisions of this Code, for the
12 regulation and conduct of its affairs and business.
13 (3) To adopt and make use of a corporate seal and
14 to alter the seal at pleasure.
15 (4) To avail itself of the use of information,
16 services, facilities, and employees of the State of
17 Illinois in carrying out the provisions of this Code.
18 (5) To receive funds, printer registration fees,
19 and penalties assessed by the Department under this Code
20 Section 5-30.
21 (6) To administer the Fund by investing funds of
22 the Corporation that the Board may determine are not
23 presently needed for its corporate purposes.
24 (7) To receive funds from the Trust Account for
25 deposit into the Fund.
26 (8) Upon the request of the Director, to make
27 payment from the Fund to the Trust Account when payment
28 is necessary to compensate claimants in accordance with
29 the provisions of Section 25-20 or for payment of refunds
30 to licensees in accordance with the provisions of this
31 Code.
32 (9) To have those powers that are necessary or
33 appropriate for the exercise of the powers specifically
34 conferred upon the Corporation and all incidental powers
-41- LRB9105804LDmb
1 that are customary in corporations.
2 (Source: P.A. 89-287, eff. 1-1-96.)