Bill Amendment: IL SB0010 | 2017-2018 | 100th General Assembly

NOTE: For additional amemendments please see the Bill Drafting List

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Bill Title: LOCAL GOV-ASSIGN RECEIPTS

Status: 2019-01-09 - Session Sine Die [SB0010 Detail]

Download: Illinois-2017-SB0010-Senate_Amendment_001.html

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Sen. John J. Cullerton

Filed: 1/20/2017

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AMENDMENT TO SENATE BILL 10
AMENDMENT NO. ______. Amend Senate Bill 10 by replacing
everything after the enacting clause with the following:
"Section 5. The Illinois Municipal Code is amended by
adding Division 13 to Article 8 as follows:
(65 ILCS 5/Art. 8 Div. 13 heading new)
DIVISION 13. ASSIGNMENT OF RECEIPTS
(65 ILCS 5/8-13-5 new)
Sec. 8-13-5. Definitions. As used in this Article:
"Assignment agreement" means an agreement between a
transferring unit and an issuing entity for the conveyance of
all or part of any revenues or taxes received by the
transferring unit from a State entity.
"Conveyance" means an assignment, sale, transfer, or other
conveyance.

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"Deposit account" means a designated escrow account
established by an issuing entity at a trust company or bank
having trust powers for the deposit of transferred receipts
under an assignment agreement.
"Issuing entity" means (i) a corporation, trust or other
entity that has been established for the limited purpose of
issuing obligations for the benefit of a transferring unit, or
(ii) a bank or trust company in its capacity as trustee for
obligations issued by such bank or trust company for the
benefit of a transferring unit.
"State entity" means the State Comptroller, the State
Treasurer, or the Illinois Department of Revenue.
"Transferred receipts" means all or part of any revenues or
taxes received from a State entity that have been conveyed by a
transferring unit under an assignment agreement.
"Transferring unit" means a home rule municipality located
in the State.
(65 ILCS 5/8-13-10 new)
Sec. 8-13-10. Assignment of receipts.
(a) Any transferring unit which receives revenues or taxes
from a State entity may (to the extent not prohibited by any
applicable statute, regulation, rule, or agreement governing
the use of such revenues or taxes) authorize, by ordinance, the
conveyance of all or any portion of such revenues or taxes to
an issuing entity. Any conveyance of transferred receipts

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shall: (i) be made pursuant to an assignment agreement in
exchange for the net proceeds of obligations issued by the
issuing entity for the benefit of the transferring unit and
shall, for all purposes, constitute an absolute conveyance of
all right, title, and interest therein; (ii) not be deemed a
pledge or other security interest for any borrowing by the
transferring unit; (iii) be valid, binding, and enforceable in
accordance with the terms thereof and of any related
instrument, agreement, or other arrangement, including any
pledge, grant of security interest, or other encumbrance made
by the issuing entity to secure any obligations issued by the
issuing entity for the benefit of the transferring unit; and
(iv) not be subject to disavowal, disaffirmance, cancellation,
or avoidance by reason of insolvency of any party, lack of
consideration, or any other fact, occurrence, or State law or
rule. On and after the effective date of the conveyance of the
transferred receipts, the transferring unit shall have no
right, title or interest in or to the transferred receipts
conveyed and the transferred receipts so conveyed shall be the
property of the issuing entity to the extent necessary to pay
the obligations issued by the issuing entity for the benefit of
the transferring unit, and shall be received, held, and
disbursed by the issuing entity in a trust fund outside the
treasury of the transferring unit. An assignment agreement may
provide for the periodic reconveyance to the transferring unit
of amounts of transferred receipts remaining after the payment

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of the obligations issued by the issuing entity for the benefit
of the transferring unit.
(b) In connection with any conveyance of transferred
receipts, the transferring unit is authorized to direct the
applicable State entity to deposit or cause to be deposited any
amount of such transferred receipts into a deposit account in
order to secure the obligations issued by the issuing entity
for the benefit of the transferring unit. Where the
transferring unit states that such direction is irrevocable,
the direction shall be treated by the applicable State entity
as irrevocable with respect to the transferred receipts
described in such direction. Each State entity shall comply
with the terms of any such direction received from a
transferring unit and shall execute and deliver such
acknowledgments and agreements, including escrow and similar
agreements, as the transferring unit may require to effectuate
the deposit of transferred receipts in accordance with the
direction of the transferring unit.
(c) Not later than the date of issuance by an issuing
entity of any obligations secured by collections of transferred
receipts, a certified copy of the ordinance authorizing the
conveyance of the right to receive the transferred receipts,
together with executed copies of the applicable assignment
agreement and the agreement providing for the establishment of
the deposit account, shall be filed with the State entity
having custody of the transferred receipts.

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(65 ILCS 5/8-13-15 new)
Sec. 8-13-15. Pledges and agreements of the State. The
State of Illinois pledges to and agrees with each transferring
unit and issuing entity that the State will not limit or alter
the rights and powers vested in the State entities by this
Article with respect to the disposition of transferred receipts
so as to impair the terms of any contract, including any
assignment agreement, made by the transferring unit with the
issuing entity or any contract executed by the issuing entity
in connection with the issuance of obligations by the issuing
entity for the benefit of the transferring unit until all
requirements with respect to the deposit by such State entity
of transferred receipts for the benefit of such issuing entity
have been fully met and discharged. In addition, the State
pledges to and agrees with each transferring unit and each
issuing entity that the State will not limit or alter the basis
on which transferred receipts are to be paid to the issuing
entity as provided in this Article, or the use of such funds,
so as to impair the terms of any such contract. Each
transferring unit and issuing entity is authorized to include
these pledges and agreements of the State in any contract
executed and delivered as described in this Article. In no way
shall the pledge and agreements of the State be interpreted to
construe the State as a guarantor of any debt or obligation
subject to an assignment agreement under this Division.

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(65 ILCS 5/8-13-20 new)
Sec. 8-13-20. Home rule. A home rule unit may not enter
into assignment agreements in a manner inconsistent with the
provisions of this Article. This Section is a limitation under
subsection (i) of Section 6 of Article VII of the Illinois
Constitution on the concurrent exercise by home rule units of
powers and functions exercised by the State.
Section 99. Effective date. This Act takes effect upon
becoming law, but this Act does not take effect at all unless
Senate Bills 1, 2, 3, 4, 5, 6, 7, 8, 9, 11, 12, and 13 of the
100th General Assembly become law.".