97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB5163
 
Introduced 2/8/2012, by Rep. Brandon W. Phelps
 
SYNOPSIS AS INTRODUCED:
 

 
  
30 ILCS 350/11  from Ch. 17, par. 6911

     Amends the Local Government Debt Reform Act. Provides that bonds that have been refunded shall not be considered to be indebtedness for the purposes of any statutory or other debt limitation if the refunded bonds are secured by and to be paid as to principal, interest, and premium from an escrow account that is invested in certain obligations and is determined to be sufficient for the timely payment of principal and interest on the refunded bonds. Provides that any governmental unit may deposit cash into an escrow account to be held uninvested for the purpose of refunding or providing for the payment of principal, interest, and premium on its bonds.
  


LRB097 18390 PJG 63616 b

FISCAL NOTE ACT MAY APPLY
 
 
A BILL FOR
 

  
HB5163LRB097 18390 PJG 63616 b


  
1    AN ACT concerning finance.
  
 
2    Be it enacted by the People of the State of Illinois,
 
3represented in the General Assembly:
  
 
 
4    Section 5. The Local Government Debt Reform Act is amended  
5by changing Section 11 as follows:
 



6    (30 ILCS 350/11)  (from Ch. 17, par. 6911)



7    Sec. 11. Refundings and redemption premiums. Bonds may be 
8refunded
or advance refunded upon such terms as the governing 
9body may set in accordance
with this Act, for such term of 
10years, not in excess of the maximum term of
years permitted by 
11applicable law for the bonds to be refunded, and in such

12principal amount, all as may be deemed necessary by the 
13governing body.
Revenue bonds may be issued to refund general

14obligation bonds or alternate
bonds issued under this Act.  
15General obligation bonds shall not be issued to
refund revenue 
16bonds or alternate bonds except as expressly permitted by

17applicable law.  Any redemption premium payable upon the 
18redemption of
bonds may be payable from the proceeds of 
19refunding bonds which may be
issued for the purpose of 
20refunding such bonds, from any other lawfully
available source 
21or from both proceeds and such other sources.

22    Bonds which have been refunded shall not be considered to 
23be indebtedness for the purposes of any statutory or other debt 
 
 
HB5163- 2 -LRB097 18390 PJG 63616 b

1limitation if such refunded bonds are secured by and to be paid 
2as to principal, interest, and premium, if any, from an escrow 
3account which is: (i) invested in (a) obligations of the United 
4States of America, (b) obligations which are guaranteed by the 
5full faith and credit of the United States of America as to the 
6timely payment of principal and interest, or (c) bonds of any 
7state or governmental unit that are rated at the time of 
8purchase within the 3 highest general classifications 
9established by a rating service of nationally recognized 
10expertise in rating bonds of states and their political 
11subdivisions; and (ii) determined by an independent certified 
12public accountant or nationally recognized feasibility analyst 
13to be sufficient to provide for the timely payment of principal 
14of and interest on the refunded bonds when due or upon 
15redemption.
16    Any governmental unit may deposit cash into an escrow 
17account to be held uninvested for the purpose of refunding or 
18providing for the payment of principal, interest, and premium, 
19if any, on its bonds, and bonds which have been so refunded or 
20provided for shall not be considered to be indebtedness for the 
21purposes of any statutory or other debt limitation. 
22(Source: P.A. 90-306, eff. 8-1-97.)