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91_SB0678eng SB678 Engrossed LRB9105805LDmb 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 SB678 Engrossed -2- LRB9105805LDmb 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. SB678 Engrossed -3- LRB9105805LDmb 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: SB678 Engrossed -4- LRB9105805LDmb 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, SB678 Engrossed -5- LRB9105805LDmb 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, SB678 Engrossed -6- LRB9105805LDmb 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. SB678 Engrossed -7- LRB9105805LDmb 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 SB678 Engrossed -8- LRB9105805LDmb 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, SB678 Engrossed -9- LRB9105805LDmb 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 SB678 Engrossed -10- LRB9105805LDmb 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. SB678 Engrossed -11- LRB9105805LDmb 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 SB678 Engrossed -12- LRB9105805LDmb 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: SB678 Engrossed -13- LRB9105805LDmb 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 SB678 Engrossed -14- LRB9105805LDmb 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 byatIllinois 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 SB678 Engrossed -15- LRB9105805LDmb 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 SB678 Engrossed -16- LRB9105805LDmb 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 byofIllinois 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 SB678 Engrossed -17- LRB9105805LDmb 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 SB678 Engrossed -18- LRB9105805LDmb 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 SB678 Engrossed -19- LRB9105805LDmb 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 SB678 Engrossed -20- LRB9105805LDmb 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 SB678 Engrossed -21- LRB9105805LDmb 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 SB678 Engrossed -22- LRB9105805LDmb 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 SB678 Engrossed -23- LRB9105805LDmb 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 SB678 Engrossed -24- LRB9105805LDmb 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 SB678 Engrossed -25- LRB9105805LDmb 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 dealerits successor is properly licensed underSB678 Engrossed -26- LRB9105805LDmb 1this Code, ithas 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 SB678 Engrossed -27- LRB9105805LDmb 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 depositBalancesin grain margin 25 accountsdetermined 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. SB678 Engrossed -28- LRB9105805LDmb 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 SB678 Engrossed -29- LRB9105805LDmb 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 andwhen33 issuedfrom the same warehouse shall beconsecutively by SB678 Engrossed -30- LRB9105805LDmb 1 the warehousemannumbered. 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 authorizedprinter approvedby 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. SB678 Engrossed -31- LRB9105805LDmb 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 SB678 Engrossed -32- LRB9105805LDmb 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 SB678 Engrossed -33- LRB9105805LDmb 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 SB678 Engrossed -34- LRB9105805LDmb 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. SB678 Engrossed -35- LRB9105805LDmb 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 SB678 Engrossed -36- LRB9105805LDmb 1 secured party oroflien 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 SB678 Engrossed -37- LRB9105805LDmb 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 Section2625-20: 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. SB678 Engrossed -38- LRB9105805LDmb 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 SB678 Engrossed -39- LRB9105805LDmb 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 SB678 Engrossed -40- LRB9105805LDmb 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 20Section 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 SB678 Engrossed -41- LRB9105805LDmb 1 that are customary in corporations. 2 (Source: P.A. 89-287, eff. 1-1-96.)