TWO new programs designed to encourage small business growth were announced by Gov. James R. Thompson in January. The Small Business Development Center Program provides technical and managerial help; the Business Procurement Assistance Program helps with federal contracts. Both are part of the governor's "Illinois Plan," administered by the Department of Commerce and Community Affairs (DCCA) (see Illinois Issues, July 1983, p. 23).

The Small Business Development Center Program is initially funded by a $397,000 grant from the U.S. Small Business Administration (SBA). The program consists of six regional centers in which universities and community colleges work with the SBA, DCCA and local business and trade organizations to assist owners of small businesses. During 1984 each of the centers will be allocated between $35,000 and $40,000 which must be matched with local funds.

Services to be provided by the centers include counseling on finances, personnel, management, production, regulations and taxes; there will also be workshops on business start-ups, computers and low cost advertising and special assistance in procurement, international marketing, business law and minority business opportunities. DCCA will use the remaining SBA funds to finance the development center program statewide and to train staff for the centers.

In July DCCA will take over administration of another program, the Small Business Institute, which is now being run by the SBA and will be funded by $97,000 from the SBA grant. Under this program, graduate students from 23 Illinois colleges and universities are providing services such as marketing, financial analysis and manpower to small businesses across the state.

The Business Procurement Asssistance Program is funded for its first six months by the Illinois Community College Board, using Federal Training Job Partnership Act money. The purpose of the program is to help Illinois businesses get more federal contracts by informing them about federal procurement procedures and helping them prepare bids, negotiate contracts and identify federal bidding specifications. There are now five Procurement Assistance Centers located throughout the state; other centers will be created through the voluntary efforts of other colleges and by local development agencies. The Small Business Development Centers can also provide help with federal contracts. For more information on these programs, call DCCA at 800/252-2923.

The regions and participating schools for the Small Business Development Program are: City of Chicago (City Colleges of Chicago, Chicago State College and Keller Graduate School of Management); Kane/ DuPage/DeKalb County Area (Northern Illinois University, Elgin Community College, Waubonsee Community College and the College of DuPage); Macon County Area (Millikin University and Richland Community College); Madison/St. Clair County Area (Southern Illinois University at Edwardsville, Lewis and Clark Community College, State Community College, Belleville Area College and Kaskaskia College); South Cook County (Governors State University, Prairie State College and Thorton Community College); Southern Illinois (Southern Illinois University at Carbondale, John A. Logan College, Rend Lake College, Shawnee Community College and Southeastern Illinois College).

The locations and participating schools for the Business Procurement Assistance Program are: Cook County (Palos Hills), Moraine Valley Community College; Cook County (River Grove), Triton Community College and Morton College; Olney, Eastern Illinois Community Colleges; Peoria, Illinois Central Community College; Rockford, Rock Valley and Highland community colleges.

Citicorp takes over First Federal

A U.S. COURT of Appeals on January 17 refused to block Citicorp of New York's proposed purchase of First Federal Savings and Loan Association of Chicago, but left open the possibility of future intervention in the takeover. The Federal Reserve Board approved the purchase January 20.

Illinois Atty. Gen. Neil Hartigan filed suit on January 9, contending that Citicorp purchase of the savings and loan would give it unfair advantage over state banks which may open only three branches and these must be within a 10-mile radius of the home office.

Citicorp paid $118 million to purchase First Federal which has 60 offices throughout the state and $4 billion in assets. First Federal had been under the supervision of Federal Savings and Loan Insurance Corporation (FSLIC) for two years because of operating losses threatening its existence. The FSLIC and the Federal Home Loan Bank Board approved the purchase December 15.

The 7th U.S. Court of Appeals said in January that Hartigan's lawsuit failed to present sufficient justification for a ruling which would block the purchase. The court, however, did order the Federal Home Loan Bank Board to provide the court with a complete record of the proceedings leading to the decision to allow the purchase. But the court allowed the board to file the records under seal, which limits access to the information. Hartigan was scheduled to file a brief opposing the record sealing in early February.

Rate hike for Illinois Bell

TELEPHONE bills for customers of Illinois Bell increased an average of 4.7 percent a month beginning January 1 as a result of $92.7 million rate hike approved by the Illinois Commerce Commission (IICC) in December. Five of the six sitting commissioners voted to grant the rate hike; the one dissenter was Democrat Daniel Rosenblum. Illinois Bell had originally asked for $248 million rate increase when it went before the commission last August but

34/March 1984/Illinois Issues

Six-year drop in traffic deaths

ILLINOIS traffic fatalities in 1983 fell to their lowest level since World War II as a six-year decline continued. No other state has had a decline in traffic deaths for this many consecutive years. Figures for 1983 show 1,537 traffic deaths, a 23 percent decline from the peak in 1978 when 2,166 fatalities were recorded. State officials said the 55-mph speed limit, improved road safety, motorist education, improved enforcement and new child restraint and drunken driving laws contributed to the decline.

About one-third of state motorists exceed the 55-mph limit, according to state statistics for February 1983. State police have an option of either issuing a warning or a ticket at speeds between 55 mph and 64 mph, but tickets must be issued at speeds over 64 mph.

Full enforcement of the state's new child restraint law began in January. Police had issued 1,907 warnings and made 10 arrests during the initial six-month grace period of the law which went into effect in July; warnings were issued for the first offense and citations for the second.

The latest revision in the drunken driving laws, which went into effect January 1, may further prevent highway deaths. The law now requires that the Secretary of State's Office be notified of all drunken drivers given court supervision. Subsequent convictions within five years require 48-hour imprisonment or 10 days of public service.

State mortgage program

AN "AFFORDABLE" mortgage program offering homebuyers 30-year, fixed rate mortgages at 10.7 percent interest (about 3 points below market rates) has been implemented by the Illinois Housing Development Authority (IHDA). The state put up $116.9 million for loans, which IHDA expects will help about 2,400 homebuyers statewide and generate over 5,000 construction jobs.

Unlike a similar program last fall which reserved 60 percent of the state money for realty firms and home builders, this time only 40 percent was allocated for developers. The other 60 percent went to buyers or individuals seeking mortgages to build homes. Lotteries were held across the state on February 1 or 2 to determine which loan applications would be processed. However, having an application processed did not mean the applicant would get the loan. Applicants still had to meet IHDA eligibility requirements.

This second "affordable" mortgage program was possible only because of innovation. Limited by federal law to $69 million (sold for the first program) in this type of bond, the IHDA was able to sell the second round of bonds only because of a new statute allowing consolidation of local government bonding power. H.B. 1613, sponsored by Rep. Ralph C. Capparelli (D-13, Chicago), passed last fall and allows local governments to pool their individual bonding powers for single family mortgages by ceding their powers to the IHDA which then can sell the bonds in one lump.

IHDA reports that municipalities were generally very enthusiastic about participating. Cook County cities are initiating their own programs, so the IHDA concentrated on middle-sized cities of 25,000 population in the rest of the state. Individually, each home-rule community is authorized to issue $1 million in single family mortgage revenue bonds for every 31,066 persons in the community; each non-home-rule community is authorized to issue half that amount. In the end, 32 cities and one county joined the pool for a total of $130 million in bonds; the IHDA did the work to consolidate the bonding power, helped pay the cost of issuing the bonds and returned on a county by county basis as much money as possible for the program.

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