HB 2718

Abstract

Amends the Illinois Housing Development Act. Requires the Director of the Illinois Housing Development Authority to oversee an annual evaluation of derivative deals, including interest rate swaps, initiated to manage interest rate exposure, in order to ascertain the financial costs of these agreements. Provides that if these agreements have resulted in losses to the Authority, the Director shall make all necessary efforts to recover those moneys. Requires the Authority to conduct specified duties to achieve these goals. Makes similar changes concerning the annual evaluation of derivative deals under the General Obligation Bond Act, the State University Certificates of Participation Act, the University of Illinois Revenue Bond Financing Act for Auxiliary Facilities, and the Toll Highway Act. Further amends the General Obligation Bond Act by removing a provision permitting a Bond Sale Order to provide for variable interest rates to be established pursuant to a process generally known as an auction rate process and to provide for appointment of one or more financial institutions to serve as auction agents and broker-dealers in connection with the establishment of such interest rates and the sale and remarketing of such Bonds. Provides that after July 1, 2017, the State may not, with respect to Bonds issued or anticipated to be issued, participate in and enter into interest rate exchange agreements, financial futures contracts, or any other similar arrangements alleged to have the purpose of managing interest rate exposure. Provides that the amount of the State's variable rate exposure with respect to Bonds shall not exceed 10% (rather than 20%). Makes other changes.