Bill Text: IL SB3077 | 2023-2024 | 103rd General Assembly | Engrossed

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Bill Title: Creates the Local Food Infrastructure Grant Act. Requires the Department of Agriculture to develop and administer a Local Food Infrastructure Grant Program to enhance local food processing, aggregation, and distribution within the State through the award of annual grants. Specifies that eligible grant applicants include certain entities that store, process, package, aggregate, or distribute farm products raised in Illinois. Provides that grant awards shall be between $1,000 and $150,000. Describes match requirements for grant recipients. Describes allowable expenses. Requires the Department to create an independent Steering Committee to guide the implementation and evaluation of the grant program. Describes the Steering Committee's composition and responsibilities. Establishes various grant application requirements. Requires the Director of Agriculture to report certain information to the Governor and General Assembly each year. Limits the liability of program administrators. Contains provisions concerning termination of a grant agreement under the Act. Defines terms. Effective immediately.

Spectrum: Moderate Partisan Bill (Democrat 10-3)

Status: (Engrossed) 2024-04-24 - Assigned to Agriculture & Conservation Committee [SB3077 Detail]

Download: Illinois-2023-SB3077-Engrossed.html

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AN ACT concerning agriculture.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 1. Short title. This Act may be cited as the Local
Food Infrastructure Grant Act.
Section 5. Definitions. In this Act:
"Department" means the Department of Agriculture.
"Director" means the Director of Agriculture.
"Fund" means the Local Food Infrastructure Grant Fund.
"Grant administrator" means the Department or a nonprofit
organization that is exempt from taxation under Section
501(c)(3) of the Internal Revenue Code, that represents
farmers, and that has entered into a subcontract with the
Department under Section 15 to administer the grant.
"Grantee" means the person or entity to whom a grant is
made from the Fund.
"Lender" means a federal or State chartered bank, a
federal land bank, a production credit association, a bank for
cooperatives, a federal or State chartered savings and loan
association, a federal or State chartered building and loan
association, a small business investment company, or any other
institution qualified within this State to originate and
service loans, including, but not limited to, an insurance

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company, a credit union, and a mortgage loan company.
"Lender" includes a wholly owned subsidiary of a
manufacturer, seller, or distributor of goods or services that
makes loans to businesses or individuals, commonly known as a
captive finance company.
"Liability" includes, but is not limited to, accounts
payable; notes or other indebtedness owed to any source;
taxes; rent; amounts owed on real estate contracts or real
estate mortgages; judgments; accrued interest payable; and any
other liability.
"State" means the State of Illinois.
"Underserved farmer" means a farmer or rancher who meets
the United States Department of Agriculture criteria to be
designated as a beginning farmer, socially disadvantaged
farmer, veteran farmer, or limited resource farmer.
"Underserved community" means a community that has limited
or no access to resources or that is otherwise disenfranchised
as determined by the Department. These communities may include
people who are socioeconomically disadvantaged; people with
limited English proficiency; geographically isolated or
educationally disenfranchised people; people of color as well
as ethnic and national origin minorities; women and children;
individuals with disabilities and others with access and
functional needs; and seniors.
"Value-added agricultural product" means any farm or
agricultural product or by-product that has its value enhanced

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through processing in Illinois, packaging in Illinois, or any
other activity in Illinois.
Section 10. Findings.
(a) The General Assembly finds that the following
conditions exist in this State:
(1) Small fruit, vegetable, and livestock farmers are
vital to the health and wealth of Illinois communities,
yet Illinois does not currently have infrastructure in
place to support local food farmers or to feed Illinois
communities.
(2) An estimated 95% of the food consumed in Illinois
is purchased from outside of our borders, resulting in the
export of billions of food dollars outside our State
rather than the enhancement of our local food economies.
(3) A shift of just 10% toward local food purchasing
by Illinois individuals, families, schools, institutions,
and State agencies could generate billions in economic
growth for our State.
(4) For Illinois families, businesses, schools, and
institutions to shift their purchasing practices, Illinois
must invest in supporting critical local food
infrastructure needed to bolster processing, aggregation,
and distribution of local food.
(b) The General Assembly determines and declares that
there exist conditions in the State that require the

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Department to issue grants on behalf of the State for the
development of local food processing, aggregation, and
distribution.
Section 15. Local Food Infrastructure Grant Program.
Funding appropriated for the Local Food Infrastructure Grant
Program shall be allocated to the Department. The Department
may enter into a subcontract agreement with a nonprofit
organization that is exempt from taxation under Section
501(c)(3) of the Internal Revenue Code and that represents
farmers in order to administer the grant program established
under this Act, so long as the administration of the grant
program by the grant administrator adheres to the requirements
of this Act, including the following requirements:
(1) Eligible grant applicants shall include any one or
more of the following entities that store, process,
package, aggregate, or distribute value-added agricultural
products or plan to do so:
(A) Illinois farms with less than 50 employees;
(B) Illinois cooperatives with less than 50
employees;
(C) Illinois processing facilities with less than
50 employees;
(D) Illinois food businesses with less than 50
employees;
(E) Illinois food hubs with less than 50

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employees;
(F) Illinois nonprofit organizations; and
(G) units of local government in Illinois.
Grant proposals may be submitted to the grant
administrator by individuals, groups, partnerships, or
collaborations. A recipient of grant funding under this
Act whose project is funded in a grant cycle is not
eligible to apply for grant funding under this Act for
that project in the next funding cycle nor is any other
person eligible to apply for grant funding for that
project in the next funding cycle. However, any person may
apply for grant funding under this Act for such project in
any subsequent funding cycles.
(2) Grant awards shall be available for collaborative
and individual projects at the following award amounts:
(A) for a collaborative project, a grant of $1,000
to $250,000 may be awarded; and
(B) for an individual project, a grant of $1,000
to $75,000 may be awarded.
(3) All funded projects must show comparable
investments by the recipient in the development and
progression of the project being funded or must show
evidence of being a high need project. The recipient's
comparable investments may be provided in cash,
cash-equivalent investments, bonds, irrevocable letters of
credit, time and labor, or any combination of those

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matching fund sources. Acceptable providers of matching
funds include, but are not limited to, commercial,
municipal, and private lenders; leasing companies; and
grantors of funds. A project may be designated as a high
need project if at least one of the following conditions
is met:
(A) the project can demonstrate that it is filling
a gap in critical infrastructure for its region or
community that is unlikely to be resolved without the
grant investment; or
(B) the project can demonstrate that the grant
investment will primarily serve underserved farmers or
underserved communities.
(4) All grant funding provided under this Act must be
used for purchasing, leasing to own, renting, building, or
installing infrastructure related to the processing,
storage, aggregation, or distribution of value-added
agricultural products. Allowable expenses include, but are
not limited to:
(A) equipment used in the production of
value-added agricultural products;
(B) milling or pressing equipment;
(C) creamery or milk product processing and
packaging equipment;
(D) food hub development or expansion;
(E) cooler walls and refrigeration units;

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(F) grading, packing, labeling, packaging, or
sorting equipment;
(G) refrigerated trucks;
(H) custom exempt mobile slaughter units and
livestock processing equipment;
(I) agroforestry processing equipment; and
(J) local fish and shrimp processing.
Grant funding provided under this Act may not be used
for labor, marketing, or promotion or for the costs of
production agriculture, such as costs for the purchase of
hoop houses, irrigation, or other infrastructure related
to starting or increasing agricultural production.
Section 17. Local Food Infrastructure Grant Fund. The
Local Food Infrastructure Grant Fund is created as a special
fund in the State treasury. Appropriations and moneys from any
public or private source may be deposited into the Fund. The
Fund shall be used for the purposes of this Act. Repayments of
grants made under this Section shall be deposited into the
Fund. A maximum of 10% of all funds appropriated through the
Fund may be used by the Department for the costs of
administering the grant within the Department or the cost of
subcontracting a grant administrator.
Section 20. Program administration.
(a) The grant administrator shall create an independent

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Local Food Infrastructure Steering Committee to guide the
implementation and evaluation of the grant program created by
this Act. The Steering Committee shall be composed of, at a
minimum, the following members: at least 3 farmers, including
one specialty crop farmer, one livestock farmer, and one
farmer of color; one representative from the local food
processing industry; one representative from a nonprofit
organization serving farmers of color; one representative from
a nonprofit organization serving farmers at large; and one
representative from the Illinois Stewardship Alliance Local
Food Farmer Caucus so long as the Caucus exists.
(b) The Steering Committee's responsibilities shall
include advising the Department and any other grant
administrator on the following matters:
(1) application requirements and terms of grant
agreements;
(2) grant criteria and preferences, including
additional criteria and preferences to be adopted by the
Department by rule;
(3) the meaning of the term "collaborative project" to
be codified in Department rules;
(4) grant review and selection;
(5) project reporting requirements for funded
projects; and
(6) evaluation of program success and adjustment of
criteria, requirements, preferences, program

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implementation, and other elements of the grant program as
needed to ensure that the grant program meets its intended
purpose and complies with this Act.
(c) An applicant for grant funding under this Act must, at
a minimum, be an Illinois resident, as defined by Department
rule, and provide the names, addresses, and occupations of all
project owners, the project address, relevant credit and
financial information (including, but not limited to, assets
and liabilities), and any other information deemed necessary
by the grant administrator for review of the grant
application. A grant award is subject to modification or
alteration under the condition that the grant award is subject
to any modifications that may be required by changes in State
law or rules. The Department shall provide written notice to
the recipient or, if subcontracting with another grant
administrator, the other grant administrator of any amendment
to the Act or rules adopted under the Act and the effective
date of those amendments.
(d) The grant administrator, in reviewing the
applications, must consider, but is not limited to
considering, the following criteria:
(1) whether the project has a reasonable assurance of
increasing the availability and accessibility of Illinois
agricultural products among Illinois communities;
(2) whether there is an adequate and realistic budget
projection; and

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(3) whether the application meets the eligibility
requirements and the project costs are eligible under this
Act.
(e) Preference for grants shall be given to the following
types of proposals:
(1) proposals that have established favorable
community support;
(2) proposals that increase the availability of
Illinois agricultural products to underserved communities
in Illinois;
(3) proposals that positively impact underserved
farmers in Illinois;
(4) proposals from established farmers and food
businesses;
(5) proposals that facilitate long-term economic
development in the local food sector;
(6) proposals that demonstrate comparable investments
by the anticipated recipient;
(7) proposals for high need projects; and
(8) proposals that are submitted by small and very
small farms and food businesses.
Section 25. Report. The grant administrator must annually
file with the Governor and General Assembly and publish
publicly each year a written report detailing the impact of
the Local Food Infrastructure Grant Program for the previous

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calendar year. The report must include:
(1) a complete list of all applications for grants
under this Act that were received during the previous
calendar year;
(2) a complete list of all persons that were awarded a
grant under this Act in the previous calendar year and the
nature and amount of their awards; and
(3) a statement of the economic impact of the grants
made in the previous calendar year, which may include jobs
created, local food sales increased, and communities
served.
Section 30. Liability. The Director, the grant
administrator, the Local Food Infrastructure Steering
Committee, Department employees, and any persons authorized to
execute grants are not personally liable on account of the
grants made under this Act and are not subject to any personal
liability or accountability by reason of the issuance of the
grants.
Section 35. Default or termination of grant agreement.
(a) If the recipient of a grant violates any of the terms
of the grant agreement, the grant administrator shall send a
written notice to the recipient that the recipient is in
default, and the recipient shall be given the opportunity to
correct the violations.

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(b) If the violation is not corrected within 30 days after
receipt of the notification, the grant administrator may take
any one or more of the following actions:
(1) The grant administrator may declare due and
payable the amount of the grant, or any portion of it, and
cease additional grant payments not yet made to the grant
recipient.
(2) The grant administrator may take any other action
considered appropriate to protect the interest of the
project.
(c) The grant administrator may determine that a recipient
has failed to faithfully perform the terms and conditions of
the scope of work of the project when:
(1) The grant administrator has notified the recipient
in writing of the existence of circumstances such as
misapplication of grant funds, failure to match grant
funds, evidence of fraud and abuse, repeated failure to
meet performance timelines or standards, or failure to
resolve negotiated points of the agreement.
(2) The recipient fails to develop and implement a
corrective action plan within 30 calendar days of the
grant administrator's notice.
(d) A grant may be terminated as provided in this
subsection:
(1) If there is no appropriation for the grant program
for a specific year, all grants for that year will be

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terminated in full. If there is an insufficient
appropriation for the grant program for a specific year,
the grant administrator may make proportionate cuts to all
recipients.
(2) If the grant administrator determines that the
recipient has failed to comply with the terms and
conditions of the grant agreement, the grant administrator
may terminate the grant in whole, or in part, at any time
before the date of completion.
(3) If the grant administrator determines that the
continuation of the project would not produce beneficial
results commensurate with the further expenditure of
funds, the grant administrator may terminate the grant in
whole, or in part, at any time before the date of
completion.
(4) If the recipient refuses or elects not to complete
the grant agreement and terminate the grant, the recipient
shall notify the grant administrator within 10 days after
the date upon which performance ceases. Upon receipt of
the notification, the grant shall be declared terminated,
and the grant administrator may declare due and payable
the amount of the grant and may cease additional grant
payments not yet made to the grantee.
(e) Any money collected from the default or termination of
a grant shall be placed into the Fund and expended for the
purposes of this Act.

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Section 40. Construction. This Act is necessary for the
welfare of this State and must be liberally construed to
effectuate its purposes. The Department may adopt rules that
are consistent with and necessary for the implementation and
administration of this Act.
Section 900. The State Finance Act is amended by adding
Section 5.1015 as follows:
(30 ILCS 105/5.1015 new)
Sec. 5.1015. The Local Food Infrastructure Grant Fund.