SB0290 95TH GENERAL ASSEMBLY

LRB095 06244 HLH 28913 b

95TH GENERAL ASSEMBLY
State of Illinois
2007 and 2008
SB0290

Introduced 2/7/2007, by Sen. David Luechtefeld

SYNOPSIS AS INTRODUCED:

70 ILCS 910/21.3 new

Amends the Hospital District Law. Provides that a hospital district may issue bonds, notes, or other obligations, or enter into a line of credit, secured by property taxes, unencumbered accounts receivable, or other revenues. Allows the district to establish a line of credit in connection with those borrowings. Provides that the Treasurer may accept a linked-deposit proposal from an eligible institution, subject to certain restrictions. Effective immediately.

A BILL FOR

AN ACT concerning local government.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Hospital District Law is amended by adding Section 21.3 as follows:

(70 ILCS 910/21.3 new)

Sec. 21.3. Issuance of certain notes, bonds, or other obligations.

(a) A hospital district may issue notes, bonds, or other obligations, or enter into a line of credit, secured by and payable from one or more of these sources: property taxes, unencumbered accounts receivable, or other revenues, in an amount not to exceed the greater of the following amounts if the source is pledged: (i) 85% of the amount of property taxes most recently levied, (ii) 85% of unencumbered accounts receivable of the district (in substantially the manner set forth in Section 21.1 of this Act), (iii) 85% of other revenues (in substantially the manner set forth in Section 21.2 of this Act), or (iv) 85% of amounts unpaid under third-party reimbursement or payment programs (including but not limited to State or federal Medicare or Medicaid payments or programs). All moneys so borrowed shall be repaid within 24 months after the date of issuance. In connection with obligations issued under this Section, the district may establish a line of credit with a bank or other financing source.

(b) Borrowings authorized under this Section shall bear interest at a rate not to exceed the maximum rate authorized by the Bond Authorization Act, from the date of issuance until paid, and are not required to be approved by referendum. The authorization to borrow provided in this Section is in addition to powers granted in other laws.

(c) Before borrowing or establishing a line of credit under this Section, the hospital district shall authorize the borrowing or line of credit by ordinance. The ordinance shall set forth facts demonstrating the need for the borrowing or line of credit, state the amount to be borrowed, establish a maximum interest rate limit not to exceed that set forth in subsection (b) of this Section, and provide a date by which the borrowed funds shall be repaid. The ordinance shall authorize and direct the relevant officials to make arrangements to set apart and hold, as applicable, the moneys that will be used to repay the borrowing. In addition, the ordinance may authorize the relevant officials to make partial repayments of the borrowing as the moneys become available and may contain any other terms, restrictions, or limitations desirable or necessary to give effect to this Section 21.3.

(d) The State Treasurer may, in his or her discretion, accept a proposal from an eligible institution that provides for a linked-deposit. This linked-deposit calls for the subscription or purchase outright of obligations, placed by the State Treasurer with an eligible lending institution, provided the institution agrees to lend the value of the deposit to eligible hospital districts that are entitled to reimbursement from the State's Medicaid program.

Section 99. Effective date. This Act takes effect upon becoming law.