(20 ILCS 3501/Art. 820 heading)

(20 ILCS 3501/820-5) Sec. 820-5. Findings and Declaration of Policy. It is hereby found and declared that there exists an urgent need to upgrade and expand the capital facilities, infrastructure and public purpose projects of units of local government and to promote other public purposes to be carried out by units of local government; that federal funding reductions combined with shifting economic conditions have impeded efforts by units of local government to provide the necessary improvements to their capital facilities, infrastructure systems and public purpose projects and to accomplish other public purposes in recent years; that adequate and well-maintained capital facilities, infrastructure systems and public purpose projects throughout this State and the performance of other public purposes by units of local government throughout this State can offer significant economic benefits and an improved quality of life for all citizens of this State; that the exercise by the Authority of the powers granted in this Article will promote economic development by enhancing the capital stock of units of local government and will facilitate the accomplishment of other public purposes by units of local government; that authorizing the Authority to borrow money in the public and private capital markets in order to provide money to purchase or otherwise acquire obligations of units of local government will assist such units of local government in borrowing money to finance and refinance the public purpose projects, capital facilities and infrastructure of the units and to finance other public purposes of such units of local government, in providing access to adequate capital markets and facilities for borrowing money by such units of local government, in encouraging continued investor interest in the obligations of such units of local government, in providing for the orderly marketing of the obligations of such units of local government, and in achieving lower overall borrowing cost and more favorable terms for such borrowing; and that the provisions of this Article are hereby declared to be in the public interest and for the public benefit. (Source: P.A. 97-333, eff. 8-12-11.)

(20 ILCS 3501/820-10) Sec. 820-10. Definitions. The following words or terms, whenever used or referred to in this Article, shall have the following meanings ascribed to them, except where the context clearly requires otherwise: (a) "Department" means the Illinois Department of Commerce and Economic Opportunity. (b) "Unit of local government" means any unit of local government, as defined in Article VII, Section 1 of the 1970 State Constitution and any local public entity as that term is defined by the Local Governmental and Governmental Employees Tort Immunity Act and also includes the State and any instrumentality, office, officer, department, division, bureau, commission, college or university thereof. (c) "Energy conservation project" means any improvement, repair, alteration or betterment of any building or facility or any equipment, including but not limited to an Energy Efficiency Project, as defined in item (iii) of subsection (b) of Section 825-65, in connection with any school district or community college district project, and any fixture or furnishing including its energy using mechanical devices to be added to or used in any building or facility that the Director of the Department has certified to the Authority will be a cost-effective energy-related project that will lower energy or utility costs in connection with the operation or maintenance of such building or facility, and will achieve energy cost savings sufficient to cover bond debt service and other project costs within 10 years from the date of project installation. (Source: P.A. 97-760, eff. 7-6-12.)

(20 ILCS 3501/820-15) Sec. 820-15. Creation of Reserve Funds. The Authority may establish and maintain one or more reserve funds in which there may be one or more accounts in which there may be deposited: (a) Any proceeds of bonds issued by the Authority required to be deposited therein by the terms of any contract between the Authority and its bondholders or any resolution of the Authority; (b) Any other moneys or funds of the Authority which it may determine to deposit therein from any other source; and (c) Any other moneys or funds made available to the Authority, including without limitation any proceeds of any local government security or any taxes or revenues, rates, charges, assessments, grants, or other funds pledged or assigned to pay, repay or secure any local government security. Subject to the terms of any pledge to the owners of any bond, moneys in any reserve fund may be held and applied to the payment of the interest, premium, if any, or principal of bonds or local government securities or for any other purpose authorized by the Authority. (Source: P.A. 93-205, eff. 1-1-04.)

(20 ILCS 3501/820-20) Sec. 820-20. Powers and Duties; Illinois Local Government Financing Assistance Program. The Authority has the power: (a) To purchase from time to time pursuant to negotiated sale or to otherwise acquire from time to time any local government securities issued by one or more units of local government upon such terms and conditions as the Authority may prescribe; (b) To issue bonds in one or more series pursuant to one or more resolutions of the Authority for any purpose authorized under this Article, including without limitation purchasing or acquiring local government securities, providing for the payment of any interest deemed necessary on such bonds, paying for the cost of issuance of such bonds, providing for the payment of the cost of any guarantees, letters of credit, insurance contracts or other similar credit support or liquidity instruments, or providing for the funding of any reserves deemed necessary in connection with such bonds and refunding or advance refunding of any such bonds and the interest and any premium thereon, pursuant to this Act; (c) To provide for the funding of any reserves or other funds or accounts deemed necessary by the Authority in connection with any bonds issued by the Authority or local government securities purchased or otherwise acquired by the Authority; (d) To pledge any local government security, including any payments thereon, and any other funds of the Authority or funds made available to the Authority which may be applied to such purpose, as security for any bonds or any guarantees, letters of credit, insurance contracts or similar credit support or liquidity instruments securing the bonds; (e) To enter into agreements or contracts with third parties, whether public or private, including without limitation the United States of America, the State, or any department or agency thereof to obtain any appropriations, grants, loans or guarantees which are deemed necessary or desirable by the Authority. Any such guarantee, agreement or contract may contain terms and provisions necessary or desirable in connection with the program, subject to the requirements established by this Article; (f) To charge reasonable fees to defray the cost of obtaining letters of credit, insurance contracts or other similar documents, and to charge such other reasonable fees to defray the cost of trustees, depositories, paying agents, bond registrars, escrow agents and other administrative expenses. Any such fees shall be payable by units of local government whose local government securities are purchased or otherwise acquired by the Authority pursuant to this Article, in such amounts and at such times as the Authority shall determine, and the amount of the fees need not be uniform among the various units of local government whose local government securities are purchased or otherwise acquired by the Authority pursuant to this Article; (g) To obtain and maintain guarantees, letters of credit, insurance contracts or similar credit support or liquidity instruments which are deemed necessary or desirable in connection with any bonds or other obligations of the Authority or any local government securities; (h) To establish application fees and other service fees and prescribe application, notification, contract, agreement, security and insurance forms and rules and regulations it deems necessary or appropriate; (i) To provide technical assistance, at the request of any unit of local government, with respect to the financing or refinancing for any public purpose. In fulfillment of this purpose, the Authority may request assistance from the Department as necessary; any unit of local government that is experiencing either a financial emergency as defined in the Local Government Financial Planning and Supervision Act or a condition of fiscal crisis evidenced by an impaired ability to obtain financing for its public purpose projects from traditional financial channels or impaired ability to fully fund its obligations to fire, police and municipal employee pension funds, or to bond payments or reserves, may request technical assistance from the Authority in the form of a diagnostic evaluation of its financial condition; (j) To purchase any obligations of the Authority issued pursuant to this Article; (k) To sell, transfer or otherwise dispose of local government securities purchased or otherwise acquired by the Authority pursuant to this Article, including without limitation, the sale, transfer or other disposition of undivided fractionalized interests in the right to receive payments of principal and premium, if any, or the right to receive payments of interest or the right to receive payments of principal of and premium, if any, and interest on pools of such local government securities; (l) To acquire, purchase, lease, sell, transfer and otherwise dispose of real and personal property, or any interest therein, and to issue its bonds and enter into leases, contracts and other agreements with units of local government in connection with such acquisitions, purchases, leases, sales and other dispositions of such real and personal property; (m) To make loans to banks, savings and loans and other financial institutions for the purpose of purchasing or otherwise acquiring local government securities, and to issue its bonds, and enter into agreements and contracts in connection with such loans; (n) To enter into agreements or contracts with any person necessary or appropriate to place the payment obligations of the Authority under any of its bonds in whole or in part on any interest rate basis, cash flow basis, or other basis desired by the Authority, including without limitation agreements or contracts commonly known as "interest rate swap agreements", "forward payment conversion agreements", and "futures", or agreements or contracts to exchange cash flows or a series of payments, or agreements or contracts, including without limitation agreements or contracts commonly known as "options", "puts" or "calls", to hedge payment, rate spread, or similar exposure; provided, that any such agreement or contract shall not constitute an obligation for borrowed money, and shall not be taken into account under Section 845-5 of this Act or any other debt limit of the Authority or the State of Illinois; (o) To make and enter into all other agreements and contracts and execute all instruments necessary or incidental to performance of its duties and the execution of its powers under this Article; (p) To contract for and finance the costs of energy audits, project-specific engineering and design specifications, and any other related analyses preliminary to an energy conservation project; and, to contract for and finance the cost of project monitoring and data collection to verify post-installation energy consumption and energy-related operating costs. Any such contract shall be executed only after it has been jointly negotiated by the Authority and the Department; and (q) To exercise such other powers as are necessary or incidental to the foregoing. (Source: P.A. 93-205, eff. 1-1-04.)

(20 ILCS 3501/820-25) Sec. 820-25. Unit of Local Government Participation. Any unit of local government is authorized to voluntarily participate in this program. Any unit of local government which is authorized to issue, sell and deliver its local government securities under any provision of the Constitution or laws of the State may issue, sell and deliver such local government securities to the Authority under this Article; provided that and notwithstanding any other provision of law to the contrary, any such unit of local government may issue and sell any such local government security at any interest rate or rates, which rate or rates may be established by an index or formula which may be implemented by persons appointed or retained therefor, payable at such time or times, and at such price or prices to which the unit of local government and the Authority may agree. Any unit of local government may pay any amount charged by the Authority pursuant to this Article. Any unit of local government participating in this program may pay out of the proceeds of its local government securities or out of any other moneys or funds available to it for such purposes any costs, fees, interest deemed necessary, premium or reserves incurred or required for financing or refinancing this program, including without limitation any fees charged by the Authority pursuant to this Article and its share, as determined by the Authority, of any costs, fees, interest deemed necessary, premium or reserves incurred or required pursuant to Section 820-20 of this Act. All local government securities purchased or otherwise acquired by the Authority pursuant to this Act shall upon delivery to the Authority be accompanied by an approving opinion of bond counsel as to the validity of such securities. The Authority shall have discretion to purchase or otherwise acquire those local government securities, as it shall deem to be in the best interest of its financing program for all units of local government taken as a whole. (Source: P.A. 93-205, eff. 1-1-04.)

(20 ILCS 3501/820-30) Sec. 820-30. Criteria for Participation in the Program. If the Authority requires an application for participation in the Program, upon submission of any such application, the Authority or any entity on behalf of the Authority shall review such application for its completeness and may, at its discretion, accept or reject such application or request such additional information as it deems necessary or advisable to aid its review. In the course of its review, the Authority may consider but shall not be limited to the following factors: (a) Whether the public purpose for which the local government security is to be issued will have a significant impact on the economy, environment, health or safety of the unit of local government; (b) The extent to which the public purpose for which the local government security is to be issued will provide reinforcement for other community and economic development related investments by such units of local government; (c) The creditworthiness of the unit of local government and the local government security, including, without limitation, the ability of the unit of local government to comply with the credit requirements of the provider of any guarantees, letters of credit, insurance contracts or other similar credit support or liquidity instruments; and (d) Such other factors as deemed necessary by the Authority which are consistent with the intent of this Act. (Source: P.A. 93-205, eff. 1-1-04.)

(20 ILCS 3501/820-35) Sec. 820-35. The Authority may assist the Department to establish and implement a program to assist units of local government to identify and arrange financing for energy conservation projects in buildings and facilities owned or leased by units of local government. Such bonds shall not constitute an indebtedness or obligation of the State of Illinois and it shall be plainly stated on the face of each bond that it does not constitute such an indebtedness or obligation but is payable solely from the revenues, income or other assets of the Authority pledged therefor. (Source: P.A. 97-760, eff. 7-6-12.)

(20 ILCS 3501/820-40) Sec. 820-40. Investment of moneys. Any moneys at any time held by the Authority pursuant to this Article shall be held outside the State treasury in the custody of either the Treasurer of the Authority or a trustee or depository appointed by the Authority. Such moneys may be invested in (a) investments authorized by the Public Funds Investment Act, (b) obligations issued by any State, unit of local government or school district, which obligations are rated at the time of purchase by a national rating service within the 2 highest rating classifications without regard to any rating refinement or gradation by numerical or other modifier, (c) equity securities of an investment company registered under the Investment Company Act of 1940 whose sole assets, other than cash and other temporary investments, are obligations which are eligible investments for the Authority, or (d) investment contracts under which securities are to be purchased and sold at a predetermined price on a future date, or pursuant to which moneys are deposited with a bank or other financial institution and the deposits are to bear interest at an agreed upon rate, provided that such investment contracts are with a bank or other financial institution whose obligations are rated at the time of purchase by a national rating service within the 2 highest rating classifications without regard to any rating refinement or gradation by numerical or other modifier. The interest, dividends or other earnings from such investments may be used to pay administrative costs of the Authority incurred in administering the program or trustee or depository fees incurred in connection with such program. (Source: P.A. 93-205, eff. 1-1-04.)

(20 ILCS 3501/820-45) Sec. 820-45. Pledge of Revenues by the Authority. Any pledge of revenues or other moneys made by the Authority shall be binding from the time the pledge is made. Revenues and other moneys so pledged shall be held outside of the State treasury and in the custody of either the Treasurer of the Authority or a trustee or a depository appointed by the Authority. Revenues or other moneys so pledged and thereafter received by the Authority or such trustee or depository shall immediately be subject to the lien of the pledge without any physical delivery thereof or further act, and the lien of any pledge shall be binding against all parties having claims of any kind of tort, contract or otherwise against the Authority, irrespective of whether the parties have notice thereof. Neither the resolution nor any other instrument by which a pledge is created need be filed or recorded except in the records of the Authority. The State does pledge to and agree with the holders of bonds, and the beneficial owners of the local government securities, that the State will not limit or restrict the rights hereby vested in the Authority to purchase, acquire, hold, sell or dispose of local government securities or other investments or to establish and collect such fees or other charges as may be convenient or necessary to produce sufficient revenues to meet the expenses of operation of the Authority, and to fulfill the terms of any agreement made with the holders of the bonds or the beneficial owners of the local government securities or in any way impair the rights or remedies of the holders of those bonds or the beneficial owners of the local government securities until such bonds or local government securities are fully paid and discharged or provision for their payment has been made. (Source: P.A. 93-205, eff. 1-1-04.)

(20 ILCS 3501/820-50) Sec. 820-50. Pledge of Funds by Units of Local Government. (a) Pledge of Funds. Any unit of local government which receives funds from the Department of Revenue, including without limitation funds received pursuant to Sections 8-11-1, 8-11-1.4, 8-11-5 or 8-11-6 of the Illinois Municipal Code, the Home Rule County Retailers' Occupation Tax Act, the Home Rule County Service Occupation Tax Act, Sections 25.05-2, 25.05-3 or 25.05-10 of "An Act to revise the law in relation to counties", Section 5.01 of the Local Mass Transit District Act, Section 4.03 of the Regional Transportation Authority Act, Sections 2 or 12 of the State Revenue Sharing Act, or from the Department of Transportation pursuant to Section 8 of the Motor Fuel Tax Law, or from the State Superintendent of Education (directly or indirectly through regional superintendents of schools) pursuant to Article 18 of the School Code, or any unit of government which receives other funds which are at any time in the custody of the State Treasurer, the State Comptroller, the Department of Revenue, the Department of Transportation or the State Superintendent of Education may by appropriate proceedings, pledge to the Authority or any entity acting on behalf of the Authority (including, without limitation, any trustee), any or all of such receipts to the extent that such receipts are necessary to provide revenues to pay the principal of, premium, if any, and interest on, and other fees related to, or to secure, any of the local government securities of such unit of local government which have been sold or delivered to the Authority or its designee or to pay lease rental payments to be made by such unit of local government to the extent that such lease rental payments secure the payment of the principal of, premium, if any, and interest on, and other fees related to, any local government securities which have been sold or delivered to the Authority or its designee. Any pledge of such receipts (or any portion thereof) shall constitute a first and prior lien thereon and shall be binding from the time the pledge is made. (b) Direct Payment of Pledged Receipts. Any such unit of local government may, by such proceedings, direct that all or any of such pledged receipts payable to such unit of local government be paid directly to the Authority or such other entity (including, without limitation, any trustee) for the purpose of paying the principal of, premium, if any, and interest on, and fees relating to, such local government securities or for the purpose of paying such lease rental payments to the extent necessary to pay the principal of, premium, if any, and interest on, and other fees related to, such local government securities secured by such lease rental payments. Upon receipt of a certified copy of such proceedings by the State Treasurer, the State Comptroller, the Department of Revenue, the Department of Transportation or the State Superintendent of Education, as the case may be, such Department or State Superintendent shall direct the State Comptroller and State Treasurer to pay to, or on behalf of, the Authority or such other entity (including, without limitation, any trustee) all or such portion of the pledged receipts from the Department of Revenue, or the Department of Transportation or the State Superintendent of Education (directly or indirectly through regional superintendents of schools), as the case may be, sufficient to pay the principal of and premium, if any, and interest on, and other fees related to, the local governmental securities for which the pledge was made or to pay such lease rental payments securing such local government securities for which the pledge was made. The proceedings shall constitute authorization for such a directive to the State Comptroller to cause orders to be drawn and to the State Treasurer to pay in accordance with such directive. To the extent that the Authority or its designee notifies the Department of Revenue, the Department of Transportation or the State Superintendent of Education, as the case may be, that the unit of local government has previously paid to the Authority or its designee the amount of any principal, premium, interest and fees payable from such pledged receipts, the State Comptroller shall cause orders to be drawn and the State Treasurer shall pay such pledged receipts to the unit of local government as if they were not pledged receipts. To the extent that such receipts are pledged and paid to the Authority or such other entity, any taxes which have been levied or fees or charges assessed pursuant to law on account of the issuance of such local government securities shall be paid to the unit of local government and may be used for the purposes for which the pledged receipts would have been used. (c) Payment of Pledged Receipts upon Default. Any such unit of local government may, by such proceedings, direct that such pledged receipts payable to such unit of local government be paid to the Authority or such other entity (including, without limitation, any trustee) upon a default in the payment of any principal of, premium, if any, or interest on, or fees relating to, any of the local government securities of such unit of local government which have been sold or delivered to the Authority or its designee or any of the local government securities which have been sold or delivered to the Authority or its designee and which are secured by such lease rental payments. If such local governmental security is in default as to the payment of principal thereof, premium, if any, or interest thereon, or fees relating thereto, to the extent that the State Treasurer, the State Comptroller, the Department of Revenue, the Department of Transportation or the State Superintendent of Education (directly or indirectly through regional superintendents of schools) shall be the custodian at any time of any other available funds or moneys pledged to the payment of such local government securities or such lease rental payments securing such local government securities pursuant to this Section and due or payable to such a unit of local government at any time subsequent to written notice to the State Comptroller and State Treasurer from the Authority or any entity acting on behalf of the Authority (including, without limitation, any trustee) to the effect that such unit of local government has not paid or is in default as to payment of the principal of, premium, if any, or interest on, or fees relating to, any local government security sold or delivered to the Authority or any such entity (including, without limitation, any trustee) or has not paid or is in default as to the payment of such lease rental payments securing the payment of the principal of, premium, if any, or interest on, or other fees relating to, any local government security sold or delivered to the Authority or such other entity (including, without limitation, any trustee): (i) The State Comptroller and the State Treasurer

shall withhold the payment of such funds or moneys from such unit of local government until the amount of such principal, premium, if any, interest or fees then due and unpaid has been paid to the Authority or any such entity (including, without limitation, any trustee), or the State Comptroller and the State Treasurer have been advised that arrangements, satisfactory to the Authority or such entity, have been made for the payment of such principal, premium, if any, interest and fees; and

(ii) Within 10 days after a demand for payment by the

Authority or such entity given to such unit of local government, the State Treasurer and the State Comptroller, the State Treasurer shall pay such funds or moneys as are legally available therefor to the Authority or such entity for the payment of principal of, premium, if any, or interest on, or fees relating to, such local government securities. The Authority or any such entity may carry out this Section and exercise all the rights, remedies and provisions provided or referred to in this Section.

(d) Remedies. Upon the sale or delivery of any local government securities of the Authority or its designee, the local government which issued such local government securities shall be deemed to have agreed that upon its failure to pay interest or premium, if any, on, or principal of, or fees relating to, the local government securities sold or delivered to the Authority or any entity acting on behalf of the Authority (including, without limitation, any trustee) when payable, all statutory defenses to nonpayment are thereby waived. Upon a default in payment of principal of or interest on any local government securities issued by a unit of local government and sold or delivered to the Authority or its designee, and upon demand on the unit of local government for payment, if the local government securities are payable from property taxes and funds are not legally available in the treasury of the unit of local government to make payment, an action in mandamus for the levy of a tax by the unit of local government to pay the principal of or interest on the local government securities shall lie, and the Authority or such entity shall be constituted a holder or owner of the local government securities as being in default. Upon the occurrence of any failure or default with respect to any local government securities issued by a unit of local government, the Authority or such entity may thereupon avail itself of all remedies, rights and provisions of law applicable in the circumstances, and the failure to exercise or exert any rights or remedies within a time or period provided by law may not be raised as a defense by the unit of local government. (Source: P.A. 93-205, eff. 1-1-04.)

(20 ILCS 3501/820-55) Sec. 820-55. Eligible Investments. Bonds, issued by the Authority pursuant to the provisions of this Article, shall be permissible investments within the provisions of Section 805-40 of this Act. (Source: P.A. 93-205, eff. 1-1-04.)

(20 ILCS 3501/820-60) Sec. 820-60. Tax Exemption. The exercise of powers granted in this Article is in all respects for the benefit of the people of Illinois and in consideration thereof the bonds issued pursuant to the aforementioned Sections and the income therefrom shall be free from all taxation by the State or its political subdivisions, except for estate, transfer and inheritance taxes. For purposes of Section 250 of the Illinois Income Tax Act, the exemption of the income from bonds issued under the aforementioned Sections shall terminate after all of the bonds have been paid. The amount of such income that shall be added and then subtracted on the Illinois income tax return of a taxpayer, pursuant to Section 203 of the Illinois Income Tax Act, from federal adjusted gross income or federal taxable income in computing Illinois base income shall be the interest net of any bond premium amortization. (Source: P.A. 93-205, eff. 1-1-04.)