Full Text of SB0014 94th General Assembly
SB0014sam003 94TH GENERAL ASSEMBLY
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Sen. Emil Jones Jr.
Filed: 4/20/2005
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| AMENDMENT TO SENATE BILL 14
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| AMENDMENT NO. ______. Amend Senate Bill 14, AS AMENDED, by | 3 |
| replacing everything after the enacting clause with the | 4 |
| following:
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| "Section 1. Short title. This Act may be cited as the | 6 |
| Illinois Opportunity
Fund
Act.
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| Section 5. Findings and purposes.
| 8 |
| (a) The State of Illinois finds that the traditional means | 9 |
| by which venture
capital
and private equity investors direct | 10 |
| capital to Illinois markets does not
adequately serve the
| 11 |
| State's needs. The lack of sufficient capital impairs the | 12 |
| ability of the State to
create jobs, new
markets for goods and | 13 |
| services, and sustainable economic growth throughout
Illinois. | 14 |
| The State of Illinois finds that venture capital and private | 15 |
| equity investments traditionally have been an efficient means | 16 |
| to create jobs, expand new markets for products and services, | 17 |
| and generally encourage economic growth.
The State of Illinois | 18 |
| desires to strengthen the overall economy of the State by
| 19 |
| increasing
the availability and delivery of venture capital and | 20 |
| private equity investments for emerging, expanding, and | 21 |
| distressed
enterprises in
Illinois, and to do so in a way that | 22 |
| provides for financial returns to private
investors.
| 23 |
| (b) Furthermore, the State of Illinois finds that certain | 24 |
| geographic areas
and
populations within the State have been |
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| subject to economic disparities and have
lacked
access to the | 2 |
| private capital needed to create jobs and economic | 3 |
| opportunities.
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| (c) Venture capital and private equity investment should be | 5 |
| directed to geographic areas and populations
within
the State | 6 |
| that have been subject to economic disparities, have lacked | 7 |
| access
to the
private capital needed to create jobs and | 8 |
| economic opportunities, and to
sectors
considered to be | 9 |
| strategic industries for the State of Illinois.
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| (d) This Act has the mission of mobilizing private capital | 11 |
| investment in a broad
variety of
venture capital and private | 12 |
| equity investment funds in diversified industries and | 13 |
| geographic regions of the
State of
Illinois. To achieve this | 14 |
| mission, the General Assembly believes that it is
necessary to
| 15 |
| retain the private sector culture of focusing on rate of return | 16 |
| in the
investing process.
Therefore, this Act is intended to | 17 |
| facilitate the establishment of the Illinois
Opportunity
Fund, | 18 |
| seek private investment, and create interest in these | 19 |
| investments by
offering State
credit enhancements that limit | 20 |
| risk to private investors. This Act also has the
mission of
| 21 |
| facilitating and
enhancing the flow of venture capital and | 22 |
| private equity into the State of Illinois and improving
the
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| infrastructure through which capital is delivered throughout | 24 |
| the State including to those geographic areas and populations | 25 |
| within the State that have been subject to economic | 26 |
| disparities, so as to create jobs in Illinois, expand new | 27 |
| markets for Illinois products and Illinois services, and to | 28 |
| generally grow the Illinois economy. It is the goal and intent | 29 |
| of this
legislation to accomplish
these missions in such a | 30 |
| manner as to minimize any appropriations by the State
of | 31 |
| Illinois
to effectuate these purposes.
| 32 |
| Section 10. Definitions. In this Act, unless the context | 33 |
| requires otherwise:
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| "DCEO" means Department of Commerce and Economic | 2 |
| Opportunity, or its
successor agency.
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| "Corporation" means the Illinois Capital Investment | 4 |
| Corporation created by this Act. | 5 |
| "Certificate" means an assignable contract between DCEO | 6 |
| and an investor in
the
Illinois Opportunity Fund under which | 7 |
| the terms of the tax credits being issued
for the
benefit of | 8 |
| the investor, or any assignee of the investor, as established | 9 |
| by
DCEO, are
set forth.
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| "Person" means an individual, a corporation, a | 11 |
| partnership, or any other
lawfully
organized entity, whether | 12 |
| domiciled in Illinois or outside of Illinois.
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| "Illinois Capital Investment Corporation" means the | 14 |
| private not-for-profit
corporation established pursuant to | 15 |
| this Act.
| 16 |
| "Illinois Opportunity Fund" means the private for-profit | 17 |
| fund established by
the
Illinois Capital Investment | 18 |
| Corporation pursuant to this Act.
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| "Tax credits" means credits against taxes imposed pursuant | 20 |
| to Section 201 of
the
Illinois Income Tax Act for any taxable | 21 |
| year ending after December 31, 2009,
and
having such terms as | 22 |
| are established by DCEO in accordance with Section 25 of
this | 23 |
| Act,
including any contingencies on redemption.
| 24 |
| "SBIC" means small business investment company within the | 25 |
| meaning of the
federal Small Business Investment Act of 1958.
| 26 |
| "CDFI" and "CDVC". CDFI means a "community development | 27 |
| financial
institution" as defined in the Illinois Investment | 28 |
| and Development Authority
Act, and
CDVC means community | 29 |
| development venture capital, a type of CDFI specific to
| 30 |
| investing equity interests in Illinois firms with the dual goal | 31 |
| of financial
returns and
economic and social benefit.
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| "Venture capital and private equity investment" includes | 33 |
| private institutional, angel, incubator, mezzanine, | 34 |
| seed/start-up stage, early stage, expansions stage, later |
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| stage, community development venture capital investments and | 2 |
| management buyouts, recapitalization of existing companies, | 3 |
| and other structured growth private equity transactions. | 4 |
| "Venture Capital and Private Equity Professional" means an | 5 |
| individual with substantial professional experience, as a | 6 |
| principal and not as an intermediary, managing venture capital | 7 |
| and private equity funds, who has demonstrated a track record | 8 |
| of successful performance that includes realized or exited | 9 |
| investments. For purposes of this definition "principal" means | 10 |
| an individual with an ownership interest in the venture capital | 11 |
| and private equity fund which that individual manages or | 12 |
| operates. | 13 |
| Section 15. Illinois Capital Investment Corporation.
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| (a) DCEO shall create the Illinois Capital Investment | 15 |
| Corporation as a
private not-for-profit corporation under the | 16 |
| General Not For Profit Corporation Act of 1986
and not
as a | 17 |
| public corporation or instrumentality of the State. The | 18 |
| corporation shall
not enjoy
any of the privileges nor be | 19 |
| required to comply with any of the requirements of
a State
| 20 |
| agency except as provided in this Act. Except as provided in | 21 |
| this Act, nothing in this Act exempts the
Corporation from the | 22 |
| same requirements under State law that apply to
other
| 23 |
| Corporations organized under the General Not For Profit | 24 |
| Corporation Act of
1986. The
Director or Acting Director of | 25 |
| DCEO or his or her designee shall be the
incorporator of
the | 26 |
| Corporation.
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| (b) The Corporation shall establish investment objectives | 28 |
| and criteria for venture capital and private equity investment | 29 |
| undertaken through the Illinois Opportunity Fund. In | 30 |
| establishing these investment objectives and criteria, the | 31 |
| Corporation shall consider whether the venture capital and | 32 |
| private equity investment is reasonably anticipated (i) to be | 33 |
| consistent with a private sector focus on rate of return in the |
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| investment process; (ii) to provide financial returns | 2 |
| sufficient to meet any obligations to private investors | 3 |
| undertaken by the Corporation in accordance with this Act; | 4 |
| (iii) to attract investment from private markets in investments | 5 |
| within the State of Illinois; and (iv) to result in the | 6 |
| strengthening of the State's economy. In establishing these | 7 |
| investment objectives and criteria, the Corporation shall | 8 |
| consult with leaders in the private sector venture capital and | 9 |
| private equity community, business, science, and government to | 10 |
| identify strategic industries and sectors that offer the | 11 |
| potential to create high quality and sustainable employment | 12 |
| opportunities for Illinois residents and create domestic and | 13 |
| global markets for the products and services of the investee | 14 |
| companies. In addition, in establishing these objectives and | 15 |
| criteria, the Corporation shall consider whether venture | 16 |
| capital and private equity investment will occur through the | 17 |
| Illinois Opportunity Fund in diverse geographies and among | 18 |
| populations that have been subject to economic disparities and | 19 |
| have lacked access to private capital within Illinois. | 20 |
| (c) DCEO shall assist the corporation in performing its | 21 |
| duties, and undertake such other responsibilities as are set | 22 |
| forth in this Act or as may be necessary or appropriate to give | 23 |
| effect to the intent and purposes of this Act. | 24 |
| (d) The Corporation shall cooperate and coordinate with | 25 |
| DCEO to fulfill the economic development policy of the State as | 26 |
| established by the Governor and the General Assembly and | 27 |
| implemented by DCEO. | 28 |
| (e) The Corporation shall have responsibility for | 29 |
| organizing and overseeing the management of the Illinois | 30 |
| Opportunity Fund and identifying and engaging a private fund | 31 |
| manager or managers for the Illinois Opportunity Fund. The | 32 |
| board of directors of the Corporation shall make investment | 33 |
| decisions after considering the recommendations of the fund | 34 |
| manager or managers. The Corporation shall receive investment |
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| returns from the Illinois Opportunity Fund and shall reinvest | 2 |
| those funds in venture capital and private equity investments | 3 |
| subject to the provisions of this Act. | 4 |
| (f) The Corporation shall exercise no
governmental
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| functions. Without limiting the authority of DCEO to
issue
tax | 6 |
| credits pursuant to this Act under certificates that are | 7 |
| binding on DCEO
and the
Illinois Department of Revenue, the | 8 |
| obligations of the Corporation are not obligations of the State | 9 |
| or any political subdivision of
the State
within the meaning of | 10 |
| any Constitutional or statutory debt limitations, but are
| 11 |
| obligations
of the Corporation payable solely and only from the | 12 |
| corporation's funds. The Corporation shall itself have no | 13 |
| authority to pledge the
credit or
taxing power of the State or | 14 |
| make its
debts
payable out of any moneys except those of the | 15 |
| Corporation.
| 16 |
| (g) The Corporation shall consist of a board of directors | 17 |
| of 7 members, who shall be appointed by the Governor with the | 18 |
| advice and consent of the Senate. Upon appointment of the board | 19 |
| of directors and every 2 years thereafter, the chairperson of | 20 |
| the Corporation shall be selected by the Governor to serve as | 21 |
| chairperson for 2 years. The Director or Acting Director of | 22 |
| DCEO or his or her designee shall be one of the 7 members of the | 23 |
| board of directors of the Corporation. A quorum of the board of | 24 |
| directors must exist in order for the board to transact | 25 |
| business. A quorum of the board of directors shall consist of a | 26 |
| majority of directors then in office but in no event less than | 27 |
| 3 directors. The appointment of the board of directors of the | 28 |
| Corporation shall reflect the geographic and social diversity | 29 |
| of the State. At least 3 members of the board of directors | 30 |
| shall be Venture Capital and Private Equity Professionals. In | 31 |
| making appointments to the Corporation's board of directors, it | 32 |
| shall be considered whether (i) each candidate has meaningful | 33 |
| experience reviewing,
preparing,
analyzing, or interpreting | 34 |
| financial statements or has sophistication in
financial |
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| matters
generally, (ii) has meaningful experience in the | 2 |
| supervision or management of
venture capital
or private equity | 3 |
| investments, (iii) has meaningful experience operating
or
| 4 |
| managing investments in businesses engaged in the industries or | 5 |
| sectors
targeted as candidates for investment by the | 6 |
| Corporation, or (iv) has
meaningful
experience managing or | 7 |
| selecting investments for institutional, seed, angel,
| 8 |
| mezzanine, or
community
development venture capital and | 9 |
| private equity investment funds or SBIC's. At the time of | 10 |
| appointment, the Governor shall designate 3 directors to serve | 11 |
| until the third Monday of July 2006, one of whom shall be a | 12 |
| Venture Capital and Private Equity Professional, and 3 | 13 |
| directors to serve until the third Monday in July, 2007, 2 of | 14 |
| whom shall be Venture Capital and Private Equity Professionals. | 15 |
| Thereafter, appointments shall be made for 3-year terms. A | 16 |
| director shall serve until his or her successor shall be | 17 |
| appointed and have qualified for office. The Governor may | 18 |
| remove any director of the Corporation for cause.
| 19 |
| (h) A conflict of interest shall be deemed to exist if the | 20 |
| Corporation considers entering into a contract with or directly | 21 |
| or indirectly sells goods or services to a director, officer, | 22 |
| employee of the Board, or the fund manager of the Illinois | 23 |
| Opportunity Fund, or any for-profit firm or corporation in | 24 |
| which that director, officer, employee, the fund manager of the | 25 |
| Illinois Opportunity Fund or any member of his or her immediate | 26 |
| family is an officer, partner, or principal stockholder. Upon a | 27 |
| showing that a conflict of interest exists, the director, | 28 |
| officer, employee, or fund manager of the Illinois Opportunity | 29 |
| Fund shall abstain from any discussion or decision making with | 30 |
| respect to that contract or agreement, from voting on any | 31 |
| matter pertaining to that contract or agreement, and from | 32 |
| communicating with other Board members, officers, agents, or | 33 |
| employees concerning that contract or agreement. In no event | 34 |
| shall the board of directors make any investment in a fund in |
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| which a member of the board of directors is a general partner | 2 |
| or a limited partner. The Corporation, its board of directors, | 3 |
| its officers, its employees, and the fund manager of the | 4 |
| Illinois Opportunity Fund are subject to the prohibitions | 5 |
| contained in Section 5-55 of the State Officials and Employees | 6 |
| Ethics Act. | 7 |
| (i) The board of directors of the Corporation shall | 8 |
| establish a committee for the selection and evaluation of | 9 |
| applicants for the position or positions of fund manager or | 10 |
| managers for the Illinois Opportunity Fund. The board of | 11 |
| directors of the Corporation shall also establish procedures | 12 |
| for the selection and evaluation of applicants for the position | 13 |
| or positions of fund manager for the Illinois Opportunity Fund. | 14 |
| The committee shall include not more than 3 members of the | 15 |
| board of directors of the Corporation, one of which shall be | 16 |
| the Director of DCEO or his or her designee. The chairman shall | 17 |
| appoint the remaining 2 members of the committee from the | 18 |
| members of the board of directors of the Corporation and at | 19 |
| least one of whom shall be a Venture Capital and Private Equity | 20 |
| Professional. The committee shall receive and review | 21 |
| applications for the position of fund manager of the Illinois | 22 |
| Opportunity Fund. Any applicant selected to be a fund manager | 23 |
| of the Illinois Opportunity Fund shall demonstrate substantial | 24 |
| experience in the design, implementation, and management of | 25 |
| institutional, seed, angel, mezzanine, or community | 26 |
| development venture capital investment and private equity | 27 |
| programs or of SBIC's and in capital formation. In reviewing | 28 |
| applications, the committee shall consider each applicant's | 29 |
| (i) senior level decision making experience in institutional, | 30 |
| seed, angel, mezzanine, or community development venture | 31 |
| capital and private equity investments or SBIC's investing, | 32 |
| including whether the applicant has at least 5 years of such | 33 |
| experience, (ii) quality of management, (iii) investment | 34 |
| philosophy, (iv) plan for fundraising, (v) ties to Illinois |
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| including whether it has a meaningful physical presence in | 2 |
| Illinois and knowledge and experience in working with the | 3 |
| Illinois venture capital and private equity investment | 4 |
| community, and (vi) prior investment fund results, including a | 5 |
| track record with a substantial number of realized or exited | 6 |
| investments, a time frame over which the track record was | 7 |
| achieved, the number of investments the track record is based | 8 |
| upon and the economic conditions existing during the time frame | 9 |
| of the track record, and shall include a preference that each | 10 |
| applicant's experience be financial (as with a formal | 11 |
| investment fund) rather than strategic (such as mergers and | 12 |
| acquisitions). Each applicant shall submit an investment plan | 13 |
| for review by the Corporation, which shall describe the | 14 |
| applicant's plan for seeking investment opportunities, | 15 |
| evaluating and structuring investments fulfilling the | 16 |
| investment objectives and criteria established by the | 17 |
| Corporation, and achieving the financial and policy goals of | 18 |
| this Act. Upon completion of this evaluation, the committee | 19 |
| shall rank the applicants based on their qualifications and | 20 |
| recommend a fund manager or managers for selection to the board | 21 |
| of directors of the Corporation.
The board of directors of the | 22 |
| Corporation shall select an applicant or applicants based on | 23 |
| the recommendations of the committee, and shall notify the | 24 |
| applicant or applicants selected in writing.
| 25 |
| (j) The Corporation may charge a fee to the
Illinois
| 26 |
| Opportunity Fund, which shall be in addition to any fee payable | 27 |
| by the Illinois
Opportunity Fund to the fund manager or | 28 |
| managers engaged. The fee
payable
to the Corporation shall be | 29 |
| structured to cover the
reasonable
costs of the corporation in | 30 |
| fulfilling its oversight functions and of DCEO in
fulfilling | 31 |
| its
obligations under this Section and Section 25.
| 32 |
| (k) The directors of the Corporation shall be
compensated | 33 |
| from the Illinois Opportunity Fund
for direct expenses and | 34 |
| mileage but shall not receive a director's fee or
salary for |
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| their
service as directors.
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| (l) The Corporation shall indemnify and defend members of | 3 |
| the board of directors of the Corporation for any and all | 4 |
| claims against the members of the board of directors arising | 5 |
| from or related to the performance of their duties to the | 6 |
| Corporation. | 7 |
| (m) The Corporation shall have the power to
engage
| 8 |
| consultants, expend funds, invest funds, contract, bond or | 9 |
| insure against loss, engage counsel,
and
perform any other act | 10 |
| necessary to carry out its mission. Without limiting the | 11 |
| foregoing, the Corporation may (i) borrow such funds as may be | 12 |
| needed to accomplish its goals; (ii) open and manage bank and | 13 |
| short-term investment accounts deemed necessary by its fund | 14 |
| manager or managers; and (iii) expend funds to secure | 15 |
| investment ratings. The Corporation shall not borrow more than | 16 |
| the difference between the aggregate amount of contingent tax | 17 |
| credits allowed and the aggregate amount of contingent tax | 18 |
| credits issued pursuant to Section 25 of this Act. The | 19 |
| Corporation shall engage a certified public accountant to | 20 |
| conduct an annual audit of its financial condition and | 21 |
| operations, including the Illinois Opportunity Fund.
| 22 |
| (n) The directors of the Corporation shall adopt
bylaws,
| 23 |
| policies, and procedures necessary to administer the affairs of | 24 |
| the
corporation.
| 25 |
| (o) Upon the dissolution of the Corporation, any
assets | 26 |
| owned
by it shall thereupon be distributed to the General | 27 |
| Revenue Fund of the State of Illinois.
| 28 |
| (p) The meetings of the Board of directors, and any | 29 |
| committee thereof, are subject to the requirements of the Open | 30 |
| Meetings Act. The Board of Directors, and any committees | 31 |
| thereof, may hold a closed session to discuss and evaluate any | 32 |
| information submitted by applicants to be a fund manager of the | 33 |
| Illinois Opportunity Fund to the extent that information exempt | 34 |
| from disclosure under subsection 1(g) or 1(h) of Section 7 of |
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| the Freedom of Information Act. The procedural requirements of | 2 |
| the Open Meetings Act shall apply to this closed session.
| 3 |
| Section 16. Fund Managers of the Illinois Opportunity Fund. | 4 |
| (a) Once selected by the directors of the Corporation, the | 5 |
| fund manager or managers of the Illinois Opportunity Fund shall | 6 |
| research and select venture capital and private equity | 7 |
| investment funds to recommend to the Corporation's board of | 8 |
| directors. | 9 |
| (b) The fund manager or managers of the Illinois | 10 |
| Opportunity Fund shall be compensated from funds raised for and | 11 |
| investment returns from the Illinois Opportunity Fund at a | 12 |
| level to be established by the directors of the Corporation and | 13 |
| consistent with industry norms. | 14 |
| (c) No less than 90 days after a majority of the members of | 15 |
| the Board of Directors of the Illinois Capital Investment | 16 |
| Corporation are nominated by the Governor and approved by the | 17 |
| Senate, the Board shall develop a policy adopted by resolution | 18 |
| of the Board stating the Board's plan for the use of financial | 19 |
| services corporations owned by minorities, females, and | 20 |
| persons with disabilities, as defined under the Business | 21 |
| Enterprise for Minorities, Females, and Persons with | 22 |
| Disabilities Act. The Board shall provide a copy of this | 23 |
| resolution to the Governor and the General Assembly upon its | 24 |
| adoption. | 25 |
| (d) On December 31st of each year, the Board shall report | 26 |
| to the General Assembly and the Governor regarding the use of | 27 |
| financial services corporations owned by minorities, females, | 28 |
| and persons with disabilities, as defined under the Business | 29 |
| Enterprise for Minorities, Females, and Persons with | 30 |
| Disabilities Act. | 31 |
| Section 20. Illinois Opportunity Fund.
| 32 |
| (a) The Corporation
shall organize
the Illinois |
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| Opportunity Fund as a for-profit limited partnership or limited
| 2 |
| liability
company under Illinois law pursuant to which the | 3 |
| Corporation
shall be the general partner or managing member, as | 4 |
| the case may be.
| 5 |
| (b) The Corporation is authorized to issue such interests | 6 |
| or obligations that shall provide for a fixed or variable rate | 7 |
| of return as established by the Corporation with the consent of | 8 |
| DCEO. Consistent with this Act, DCEO may award contingent tax | 9 |
| credits to investors in the
Illinois
Opportunity Fund that | 10 |
| shall be redeemable if the Illinois Opportunity Fund
fails to
| 11 |
| achieve results sufficient to repay the amounts invested by the | 12 |
| investors and
provide
them with specified returns. Returns on | 13 |
| investments generated by the Illinois
Opportunity Fund in | 14 |
| excess of amounts required to (i) repay the amounts
invested by
| 15 |
| investors and provide them with specified returns, (ii) pay the | 16 |
| operating costs of the Corporation, including but not limited | 17 |
| to the agreed upon compensation of the fund manager or | 18 |
| managers, and (iii) pay all or an agreed upon portion of DCEO's | 19 |
| costs incurred in connection with the start-up of the | 20 |
| Corporation and the Opportunity Fund and such other costs | 21 |
| incurred by DCEO by providing assistance to the Corporation | 22 |
| consistent with this Act.
| 23 |
| (c) The Illinois Opportunity Fund shall operate as a fund | 24 |
| of funds
that
invests principally in high-quality | 25 |
| institutional, seed, angel, mezzanine, and
community
| 26 |
| development
venture capital funds and SBIC's that (i) maintain | 27 |
| a meaningful physical
presence in the
State of
Illinois, (ii) | 28 |
| are
managed by fund managers who commit
that their funds will | 29 |
| invest not less than the amount invested with them by the
| 30 |
| Illinois Opportunity Fund in businesses that are headquartered | 31 |
| or maintain
meaningful business operations in the State of | 32 |
| Illinois, and (iii) meet the
investment objectives
and criteria
| 33 |
| established by the Corporation consistent with this Act.
| 34 |
| (d) No more than 5% of the fully funded (as articulated in |
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| Section 25 of this Act) Illinois Opportunity Fund shall be | 2 |
| invested in any single investment vehicle. No more than 33 1/3% | 3 |
| of the fully funded (as articulated in Section 25 of this Act) | 4 |
| Illinois Opportunity Fund shall be invested in any one calendar | 5 |
| year. In no event shall the Illinois Opportunity Fund represent | 6 |
| or compromise more than 25% of any single investment vehicle or | 7 |
| fund. | 8 |
| (e) Beginning on September 1 of the next calendar year | 9 |
| following the effective date of this Act and continuing on | 10 |
| every subsequent September 1 thereafter, the Corporation shall | 11 |
| provide to the General Assembly an annual report on its | 12 |
| activities and on the performance of the Illinois Opportunity | 13 |
| Fund. | 14 |
| (f) Twenty-five years after the creation of the Illinois | 15 |
| Opportunity Fund by the Corporation, the assets of the Fund
| 16 |
| shall be
liquidated following the payment of any obligations of | 17 |
| the Corporation or the Illinois Opportunity Fund as authorized | 18 |
| by this Act; any remaining assets shall be deposited into the | 19 |
| General Revenue Fund of the State treasury.
| 20 |
| Section 25. Contingent tax credits.
| 21 |
| (a) There is authorized to be awarded an aggregate of | 22 |
| $200,000,000 of
contingent
tax credits, reduced by the amount | 23 |
| of indebtedness to the Corporation, if any, which may be | 24 |
| allocated and issued by DCEO to investors
in the
Illinois | 25 |
| Opportunity Fund. DCEO shall not be obligated to issue | 26 |
| certificates
equal to
the full aggregate amount allowed by the | 27 |
| State of Illinois, and it may elect to
suspend or
terminate the | 28 |
| issuance of certificates at any time if it does not believe | 29 |
| that
the continued
issuance of certificates will assist the | 30 |
| State of Illinois in meeting the
objectives of this
Act. Tax | 31 |
| credits may be redeemed in any year but only as and to the
| 32 |
| extent the
Illinois Opportunity Fund is unable to return to its
| 33 |
| investors the
amounts initially invested plus the rate of |
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| return specified in the interests or obligations authorized | 2 |
| pursuant to Section 20(b) of this Act. Tax credits shall be | 3 |
| redeemable not earlier than January 1, 2010 nor later than | 4 |
| December 31, 2033 as may be specified in any certificate.
| 5 |
| (b) The aggregate redemptions of tax credits issued by | 6 |
| DCEO, however, shall
not
exceed $40,000,000 in any fiscal year | 7 |
| of the State of Illinois.
| 8 |
| (c) All tax credits shall be evidenced by certificates. | 9 |
| DCEO shall establish
and
set forth in each certificate all | 10 |
| terms and conditions, including the return of the investment | 11 |
| principal and any fixed or variable rate of return, under
which | 12 |
| tax
credits may be redeemed. In establishing the terms of any | 13 |
| tax credits and
issuing
certificates, DCEO shall seek to | 14 |
| promote the purposes of this Act. Tax credits
may not
be | 15 |
| redeemed except in accordance with the terms of the certificate | 16 |
| under which
they
have been issued. The certificates shall, upon | 17 |
| proper issuance, be binding on DCEO and the Illinois Department | 18 |
| of Revenue. The State of Illinois irrevocably pledges and | 19 |
| covenants that, prior to the redemption of all certificates | 20 |
| awarded under this Act, it will not take action to limit or | 21 |
| restrict the ability of the holders of the certificates to | 22 |
| redeem the certificates in the form of tax credits.
| 23 |
| (d) Each certificate shall be redeemable in the form of a | 24 |
| tax credit upon the date set forth in the certificate, which | 25 |
| date shall not be earlier than January 1, 2010 nor later than | 26 |
| December 31, 2033. The value of each certificate at redemption | 27 |
| shall be its compounded value, equal to its face amount at the | 28 |
| date of issuance plus an additional amount equal to the face | 29 |
| amount multiplied by the rate of return established pursuant to | 30 |
| Section 20(b) of this Act. This additional amount shall be | 31 |
| calculated on an annual basis and added annually to the value | 32 |
| of the certificate in determining the compounded value upon | 33 |
| redemption. To the extent that the compounded value of any | 34 |
| certificate upon redemption thereof exceeds the amount of |
|
|
|
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| applicable taxes imposed pursuant to Section 201 of the | 2 |
| Illinois Income Tax Act, the amount of that excess may be taken | 3 |
| as a tax credit in the subsequent tax year or years; provided | 4 |
| that the compounded value of a certificate shall not be | 5 |
| increased after its redemption date. DCEO and the Department of | 6 |
| Revenue shall promulgate rules regarding tax credits, tax | 7 |
| credit certificates, and the redemption thereof, and setting | 8 |
| forth, among other matters, the procedures for the calculating | 9 |
| of the compounded value of certificates and ability of a | 10 |
| certificate holder to redeem a portion of the compounded value | 11 |
| of any certificate in a year or years after the year of | 12 |
| redemption. The rate of return on each certificate shall under | 13 |
| no circumstances exceed the greater of 13 1/2% or 200% of the | 14 |
| rate for the most recent date shown in 20 G.O. Bonds Index of | 15 |
| Average Municipal Bond Yields as published in the most recent | 16 |
| edition of the Bond Buyer published in New York, New York, (or | 17 |
| any successor publication or index of long-term municipal bond | 18 |
| yields then selected by DCEO) at the time the certificate is | 19 |
| issued. Certificates may be redeemed only as and to the extent | 20 |
| that the Illinois Opportunity Fund is unable to return to its | 21 |
| investors the amounts initially invested plus the rate of | 22 |
| return specified in the interests or obligations authorized | 23 |
| pursuant to section 20 (b) of this Act. | 24 |
| (e) Tax credits issued pursuant to this Section shall be | 25 |
| freely transferable
by their
holders. DCEO shall, in | 26 |
| conjunction with the Illinois Department of
Revenue,
develop a | 27 |
| system for registration of any tax credits allowed or | 28 |
| transferred
pursuant to this
Act that permits verification that | 29 |
| any tax credit claimed upon a tax return is
valid and
properly | 30 |
| taken in the year of claim, and that any transfers of the tax | 31 |
| credit
are made in
accordance with the requirements of this | 32 |
| Act.
| 33 |
| (f) Tax credits allowed or transferred pursuant to this Act | 34 |
| shall not be
considered
securities under any Illinois law |
|
|
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| relating to securities.
| 2 |
| Section 30. Powers and effectiveness. Nothing contained in | 3 |
| this Act is or
shall be
construed as a restriction or | 4 |
| limitation upon any powers that DCEO might
otherwise have
under | 5 |
| any other law of this State, and the provisions of this Act are
| 6 |
| cumulative to those
powers. The provisions of this Act do and | 7 |
| shall be construed to provide a
complete,
additional, and | 8 |
| alternative method for the doing of the things authorized and
| 9 |
| shall be
regarded as supplemental and additional to powers | 10 |
| conferred by any other laws.
| 11 |
| Section 35. Acceptable investments. Investments by | 12 |
| designated investors in
the
Illinois Opportunity Fund shall be | 13 |
| deemed permissible investments for State
chartered
banks and | 14 |
| for domestic insurance companies under the appropriate laws of | 15 |
| the
State of
Illinois.
| 16 |
| Section 40. Illinois Opportunity Special Projects Fund. | 17 |
| The Illinois
Opportunity Special Projects Fund is created as a | 18 |
| special fund in the State
treasury. DCEO may accept | 19 |
| disbursements from the Illinois Opportunity Fund for
deposit | 20 |
| into the Illinois Opportunity Special Projects Fund and
expend | 21 |
| those funds for the purposes set forth in Sections 15(g), | 22 |
| 16(b), and 20(b) of
this Act, subject to appropriation.
| 23 |
| Section 100. The Illinois State Auditing Act is amended by | 24 |
| changing Section 3-1 as follows:
| 25 |
| (30 ILCS 5/3-1) (from Ch. 15, par. 303-1)
| 26 |
| Sec. 3-1. Jurisdiction of Auditor General. The Auditor | 27 |
| General has
jurisdiction over all State agencies to make post | 28 |
| audits and investigations
authorized by or under this Act or | 29 |
| the Constitution.
|
|
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| The Auditor General has jurisdiction over local government | 2 |
| agencies
and private agencies only:
| 3 |
| (a) to make such post audits authorized by or under | 4 |
| this Act as are
necessary and incidental to a post audit of | 5 |
| a State agency or of a
program administered by a State | 6 |
| agency involving public funds of the
State, but this | 7 |
| jurisdiction does not include any authority to review
local | 8 |
| governmental agencies in the obligation, receipt, | 9 |
| expenditure or
use of public funds of the State that are | 10 |
| granted without limitation or
condition imposed by law, | 11 |
| other than the general limitation that such
funds be used | 12 |
| for public purposes;
| 13 |
| (b) to make investigations authorized by or under this | 14 |
| Act or the
Constitution; and
| 15 |
| (c) to make audits of the records of local government | 16 |
| agencies to verify
actual costs of state-mandated programs | 17 |
| when directed to do so by the
Legislative Audit Commission | 18 |
| at the request of the State Board of Appeals
under the | 19 |
| State Mandates Act.
| 20 |
| In addition to the foregoing, the Auditor General may | 21 |
| conduct an
audit of the Metropolitan Pier and Exposition | 22 |
| Authority, the
Regional Transportation Authority, the Suburban | 23 |
| Bus Division, the Commuter
Rail Division and the Chicago | 24 |
| Transit Authority and any other subsidized
carrier when | 25 |
| authorized by the Legislative Audit Commission. Such audit
may | 26 |
| be a financial, management or program audit, or any combination | 27 |
| thereof.
| 28 |
| The audit shall determine whether they are operating in | 29 |
| accordance with
all applicable laws and regulations. Subject to | 30 |
| the limitations of this
Act, the Legislative Audit Commission | 31 |
| may by resolution specify additional
determinations to be | 32 |
| included in the scope of the audit.
| 33 |
| In addition to the foregoing, the Auditor General must also | 34 |
| conduct a
financial audit of
the Illinois Sports Facilities |
|
|
|
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| Authority's expenditures of public funds in
connection with the | 2 |
| reconstruction, renovation, remodeling, extension, or
| 3 |
| improvement of all or substantially all of any existing | 4 |
| "facility", as that
term is defined in the Illinois Sports | 5 |
| Facilities Authority Act.
| 6 |
| The Auditor General may also conduct an audit, when | 7 |
| authorized by
the Legislative Audit Commission, of any hospital | 8 |
| which receives 10% or
more of its gross revenues from payments | 9 |
| from the State of Illinois,
Department of Public Aid, Medical | 10 |
| Assistance Program.
| 11 |
| The Auditor General is authorized to conduct financial and | 12 |
| compliance
audits of the Illinois Distance Learning Foundation | 13 |
| and the Illinois
Conservation Foundation.
| 14 |
| As soon as practical after the effective date of this | 15 |
| amendatory Act of
1995, the Auditor General shall conduct a | 16 |
| compliance and management audit of
the City of
Chicago and any | 17 |
| other entity with regard to the operation of Chicago O'Hare
| 18 |
| International Airport, Chicago Midway Airport and Merrill C. | 19 |
| Meigs Field. The
audit shall include, but not be limited to, an | 20 |
| examination of revenues,
expenses, and transfers of funds; | 21 |
| purchasing and contracting policies and
practices; staffing | 22 |
| levels; and hiring practices and procedures. When
completed, | 23 |
| the audit required by this paragraph shall be distributed in
| 24 |
| accordance with Section 3-14.
| 25 |
| The Auditor General shall conduct a financial and | 26 |
| compliance and program
audit of distributions from the | 27 |
| Municipal Economic Development Fund
during the immediately | 28 |
| preceding calendar year pursuant to Section 8-403.1 of
the | 29 |
| Public Utilities Act at no cost to the city, village, or | 30 |
| incorporated town
that received the distributions.
| 31 |
| The Auditor General must conduct an audit of the Health | 32 |
| Facilities Planning
Board pursuant to Section 19.5 of the | 33 |
| Illinois Health Facilities Planning
Act.
| 34 |
| The Auditor General of the State of Illinois shall annually |
|
|
|
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| conduct or
cause to be conducted a financial and compliance | 2 |
| audit of the books and records
of any county water commission | 3 |
| organized pursuant to the Water Commission Act
of 1985 and | 4 |
| shall file a copy of the report of that audit with the Governor | 5 |
| and
the Legislative Audit Commission. The filed audit shall be | 6 |
| open to the public
for inspection. The cost of the audit shall | 7 |
| be charged to the county water
commission in accordance with | 8 |
| Section 6z-27 of the State Finance Act. The
county water | 9 |
| commission shall make available to the Auditor General its | 10 |
| books
and records and any other documentation, whether in the | 11 |
| possession of its
trustees or other parties, necessary to | 12 |
| conduct the audit required. These
audit requirements apply only | 13 |
| through July 1, 2007.
| 14 |
| The Auditor General must conduct audits of the Rend Lake | 15 |
| Conservancy
District as provided in Section 25.5 of the River | 16 |
| Conservancy Districts Act.
| 17 |
| The Auditor General must conduct financial audits of the | 18 |
| Southeastern Illinois Economic Development Authority as | 19 |
| provided in Section 70 of the Southeastern Illinois Economic | 20 |
| Development Authority Act.
| 21 |
| The Auditor General must conduct financial and compliance | 22 |
| audits of the Illinois Capital Investment Corporation and the | 23 |
| Illinois Opportunity Fund.
| 24 |
| (Source: P.A. 93-226, eff. 7-22-03; 93-259, eff. 7-22-03; | 25 |
| 93-275, eff. 7-22-03; 93-968, eff. 8-20-04.)
| 26 |
| Section 105. The State Finance Act is amended by adding | 27 |
| Section 5.640 as
follows:
| 28 |
| (30 ILCS 105/5.640 new)
| 29 |
| Sec. 5.640. The Illinois Opportunity Special Projects | 30 |
| Fund.
| 31 |
| Section 110. Severability. The provisions of this Act are |
|
|
|
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| severable under Section 1.31 of the Statute on Statutes.
| 2 |
| Section 999. Effective date. This Act takes effect upon | 3 |
| becoming law.".
|
|