Bill Text: IL HB2584 | 2017-2018 | 100th General Assembly | Engrossed

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Bill Title: Amends the Local Government Debt Reform Act. Provides that all bonds, including general obligation bonds and revenue bonds issued under the Act, shall be secured by a statutory lien on all revenues received or entitled to be received. Provides that the statutory lien shall automatically attach from the time the bonds are issued without further action or authorization by the governing authority of the local public entity. Provides that the lien shall be a first priority lien unless the bonds so otherwise provide. Provides that the provisions apply to all bonds issued by a local public entity, including bonds issued by a local public entity with home rule authority, and that the bonds shall have all of the protection afforded to special revenue bonds under the federal Bankruptcy Code. Effective immediately.

Spectrum: Bipartisan Bill

Status: (Failed) 2019-01-08 - Session Sine Die [HB2584 Detail]

Download: Illinois-2017-HB2584-Engrossed.html

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HB2584 Engrossed LRB100 10569 MLM 20786 b
AN ACT concerning finance.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Local Government Debt Reform Act is amended
by adding Section 13.1 as follows:
(30 ILCS 350/13.1 new)
Sec. 13.1. Statutory lien for bonds.
(a) As used in this Section, "statutory lien" shall have
the meaning given to that term under 11 U.S.C. 101(53) of the
federal Bankruptcy Code.
(b) All bonds, including general obligation bonds and
revenue bonds heretofore and hereafter issued and sold under
this Act, home rule powers, or related laws, issued by a local
public entity shall be secured by a statutory lien on all
revenues received, or entitled to be received, pursuant to (i)
the levy of taxes supporting payment of the bonds and (ii) the
assessment of user fees, rates, or other charges supporting
payment of the bonds. The statutory lien shall automatically
attach from the time the bonds are issued without further
action or authorization by the governing authority of the local
public entity. The statutory lien shall be valid and binding
from the time the bonds are executed and delivered without any
physical delivery thereof or further act required, and shall be

HB2584 Engrossed - 2 - LRB100 10569 MLM 20786 b
a first priority lien unless the bonds shall otherwise provide,
and the taxes, user fees, rates, or other charges supporting
payment of the bonds shall not be used for other purposes until
the bonds are paid in full unless the bonds shall otherwise
provide.
The revenues received, or entitled to be received, from the
following shall be immediately subject to the statutory lien,
and the statutory lien shall automatically attach to the
revenues and be effective, binding, and enforceable against the
local public entity or its successors, transferees, and
creditors, and all others asserting rights therein or having
claims of any kind in tort, contract, or otherwise against the
local public entity, irrespective of whether those parties have
notice of the lien and without the need for any physical
delivery, recordation, filing, or further act: (i) the levy of
taxes supporting payment of the bonds and (ii) the assessment
of user fees, rates, or other charges supporting payment of the
bonds. In addition, bonds issued by a local public entity under
this Act or related laws, including bonds issued by a local
public entity with home rule powers, shall have all of the
protection afforded to special revenue bonds under the federal
Bankruptcy Code.
Section 99. Effective date. This Act takes effect upon
becoming law.