Illinois Administrative Code › Title 74 - PUBLIC FINANCE › Part 1100 - ILLINOIS FINANCE AUTHORITY › Subpart G - FARM DEVELOPMENT PROGRAM › Section 1100.725 - Rules and Guidelines Applicable to the State Guarantee Program for Restructuring Agricultural Debt

Current through Register Vol. 48, No. 28, July 12, 2024
a) General Description of Program. The State
				Guarantee Program (SGP) is intended to provide farmers who are experiencing
				financial difficulties caused by high interest rates and low commodity prices
				with a debt restructuring schedule to consolidate and spread out existing debt
				over a longer term at a reduced interest rate so that farmers will be able to
				continue existing farming operations. The provisions of this Section are
				applicable only to the SGP, and the provisions of Sections
				1100.705
				and
				1100.710
				of this Part are inapplicable to the SGP and procedures provided for pursuant
				to this Section.
b) Definitions
Words defined in the Illinois Finance Authority Act and in
				  Section
				  1100.50 have the same
				  meaning when used in this Subpart unless a more specific definition is
				  prescribed in this Section. This Section establishes additional definitions for
				  use in this Subpart only.
"Applicant" means a farmer whose application for a State
				  Guarantee has been submitted to the Authority by a lender.
"Asset" includes, but is not limited to, the following: crops
				  or feed on hand; livestock held for sale; breeding stock; cash; marketable
				  bonds and securities; securities not readily marketable; accounts receivable;
				  notes receivable; cash invested in growing crops; net cash value of life
				  insurance; machinery and equipment; cars and trucks; farm and other real estate
				  including life estates, personal residence, and value of beneficial interests
				  in trusts; government payments or grants; capitalized leases; retirement
				  accounts; and all other property and assets.
"Current Outstanding" means on the date of the application
				  for any State Guarantee.
"Current Status" means the absence of any arrearages in any
				  previously incurred debt for which a State Guarantee is sought.
"Debt to Asset Ratio" means the current outstanding
				  liabilities of the farmer divided by the current outstanding assets of the
				  farmer. [20 ILCS
				  3501/830-30 ]
"Farmer" means a resident of Illinois, who is a principal
				  operator of a farm or land, at least 50% of whose gross annual income is
				  derived from farming and whose debt to asset ratio shall not be less than 40%,
				  except in those cases where the applicant has previously used the Guarantee
				  Program there shall be no debt to asset ratioor incomerestriction.
				  [20 ILCS
				  3501/830-30 ]
"Fund" means the Illinois Agricultural Loan Guarantee Fund,
				  which is the State's fund to cover losses resulting from defaults on State
				  Guarantee loans. [20 ILCS 3501/830-30]
"Gross Annual Income" means income as defined in Section 61
				  of the Internal Revenue Code (
				  26 USC 61
				  ).
"Liability" includes, but is not limited to, the following:
				  accounts payable; notes or other indebtedness owed to any source; taxes; rent;
				  amounts owed on real estate contracts or real estate mortgages;
				  judgments;accruedinterest payable; indebtedness under capitalized leases; and
				  all other liabilities. [20 ILCS
				  3501/801-10 ]
"State Guarantee" means a note for which the State of
				  Illinois shall be liable for 85% of the total principal and interest of the
				  note as determined by the Authority.
c) Eligible Farmers. To qualify for
				participation in the SGP, each farmer must:
1) maintain his principal residence in the
				State;
2) be at least 18 years of
				age at the time of application;
3)
				be the principal operator of the farming business for which the funds
				guaranteed by the SGP are contemplated to be used;
4) be able to show, based upon his/her most
				recent Federal Income Tax Return and current data, that at least 50% of his/her
				annual gross income is derived from farming, unless the loan is a renewal of an
				existing guarantee;
5) have a debt
				to asset ratio of not less than 40% and not greater than 65%, unless the loan
				is a renewal of an existing guarantee;
6) provide sufficient collateral to secure
				the State Guarantee and agree to keep the State Guarantee adequately
				collateralized in the future;
7)
				certify and agree that he/she will only use the State Guarantee to consolidate
				and restructure existing farming debts.