Public Act 103-0552
SB1646 EnrolledLRB103 27811 RPS 54189 b SB1646 Enrolled LRB103 27811 RPS 54189 b
SB1646 Enrolled LRB103 27811 RPS 54189 b
AN ACT concerning public employee benefits.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Article 1.
Section 1-5. The Illinois Pension Code is amended by
changing Section 11-196 and by adding Section 12-162.5 as
follows:
(40 ILCS 5/11-196) (from Ch. 108 1/2, par. 11-196)
Sec. 11-196. To subpoena witnesses and compel the
production of records. To issue subpoenas to compel the
attendance of witnesses to testify before it and to compel the
production of documents and records upon any matter concerning
the Fund, including, but not limited to, in conjunction with:
fund and allow witness fees not in excess of $6 per day.
(1) a disability claim;
(2) an administrative review proceeding;
(3) an attempt to obtain information to assist in the
collection of sums due to the Fund;
(4) obtaining any and all personal identifying
information necessary for the administration of benefits;
(5) the determination of the death of a benefit
recipient or a potential benefit recipient; or
SB1646 Enrolled LRB103 27811 RPS 54189 b
(6) a felony forfeiture investigation.
The fees of witnesses for attendance and travel shall be
the same as the fees of witnesses before the circuit courts of
this State and shall be paid by the party seeking the subpoena.
The Board may apply to any circuit court in the State for an
order requiring compliance with a subpoena issued under this
Section. Subpoenas issued under this Section shall be subject
to applicable provisions of the Code of Civil Procedure. The
president or other members of the board may administer oaths
to witnesses.
(Source: Laws 1963, p. 161.)
(40 ILCS 5/12-162.5 new)
Sec. 12-162.5. To subpoena witnesses and compel the
production of records. To issue subpoenas to compel the
attendance of witnesses to testify before it and to compel the
production of documents and records upon any matter concerning
the Fund, including, but not limited to, in conjunction with:
(1) a disability claim;
(2) an administrative review proceeding;
(3) an attempt to obtain information to assist in the
collection of sums due to the Fund;
(4) obtaining any and all personal identifying
information necessary for the administration of benefits;
(5) the determination of the death of a benefit
recipient or a potential benefit recipient; or
(6) a felony forfeiture investigation.
The fees of witnesses for attendance and travel shall be
the same as the fees of witnesses before the circuit courts of
this State and shall be paid by the party seeking the subpoena.
The Board may apply to any circuit court in the State for an
order requiring compliance with a subpoena issued under this
Section. Subpoenas issued under this Section shall be subject
to applicable provisions of the Code of Civil Procedure. The
president or other members of the board may administer oaths
to witnesses.
Article 2.
Section 2-5. The Illinois Pension Code is amended by
changing Sections 15-202, 16-204, 24-104, and 24-107 as
follows:
(40 ILCS 5/15-202)
Sec. 15-202. Optional deferred compensation plan.
(a) As soon as practicable after August 10, 2018 (the
effective date of Public Act 100-769), the System shall offer
a deferred compensation plan that is eligible under Section
457(b) of the Internal Revenue Code of 1986, as amended, to
participating employees of the System employed by employers
described in Section 15-106 of this Code that qualify as
eligible employers under Section 457(e)(1)(A) of the Internal
Revenue Code of 1986, as amended. Such eligible employers
shall adopt the plan with an effective date no later than
September 1, 2021. Participating employees may voluntarily
elect to make elective deferrals to the eligible deferred
compensation plan. Eligible employers may make optional
employer contributions to the plan on behalf of participating
employees, which contributions may be maintained, increased,
reduced, or eliminated at the discretion of the employer from
plan year to plan year. The plan shall collect voluntary
employee and optional employer contributions into an account
for each participant and shall offer investment options to the
participant. The plan under this Section shall be operated in
full compliance with any applicable State and federal laws,
and the System shall utilize generally accepted practices in
creating and maintaining the plan for the best interest of the
participants. In administering the deferred compensation plan,
the System shall require that the deferred compensation plan
recordkeeper agree that, in performing services with respect
to the deferred compensation plan, the recordkeeper: (i) will
not use information received as a result of providing services
with respect to the deferred compensation plan or the
participants in the deferred compensation plan to solicit the
participants in the deferred compensation plan for the purpose
of cross-selling nonplan products and services, unless in
response to a request by a participant in the deferred
compensation plan; and (ii) will not promote, recommend,
endorse, or solicit participants in the deferred compensation
plan to purchase any financial products or services outside of
the deferred compensation plan, except that links to parts of
the recordkeeper's website that are generally available to the
public, are about commercial products, and may be encountered
by a participant in the regular course of navigating the
recordkeeper's website will not constitute a violation of this
item (ii). The System may use funds from the employee and
employer contributions to defray any and all costs of creating
and maintaining the plan. The System shall produce an annual
report on the participation in the plan and shall make the
report public.
(b) The System shall automatically enroll in the eligible
deferred compensation plan any employee of an eligible
employer who first becomes a participating employee of the
System on or after July 1, 2023 under an eligible automatic
contribution arrangement that is subject to Section 414(w) of
the Internal Revenue Code of 1986, as amended, and the United
States Department of Treasury regulations promulgated
thereunder. An employee who is automatically enrolled under
this subsection (b) shall have 3% of his or her compensation,
as defined by the plan, for each pay period deferred on a
pre-tax basis into his or her account, subject to any
contribution limits applicable to the plan. The Board may
increase the default percentage of compensation deferred under
this subsection (b).
An employee shall have 30 days from the date on which the
System provides the notice required under Section 414(w) of
the Internal Revenue Code of 1986, as amended, to elect to not
participate in the eligible deferred compensation plan or to
elect to increase or reduce the initial amount of elective
deferrals made to the plan. In the absence of such affirmative
election, the employee shall be automatically enrolled in the
plan on the first day of the calendar month, or as soon as
administratively practicable thereafter, following the 30th
day from the date on which the System provides the required
notice. An employee who has been automatically enrolled in the
plan under this subsection (b) may elect, within 90 days of
enrollment, to withdraw from the plan and receive a refund of
amounts deferred, adjusted by applicable earnings and fees. An
employee making such an election shall forfeit all employer
matching contributions, if any, made with respect to such
refunded elective deferrals and such forfeited amounts shall
be used to defray plan expenses. Any refunded elective
deferrals shall be included in the employee's gross income for
the taxable year in which the refund is issued.
(c) The System may provide for one or more automatic
contribution arrangements, which shall comply with all
applicable Internal Revenue Service rules and regulations, in
conjunction with or in lieu of the eligible automatic
contribution arrangement under subsection (b), for
participating employees of eligible employers whose annual
earnings are limited by application of subsection (b) of
Section 15-111 of this Code. The amount of elective deferrals
made for the employee each pay period under an automatic
contribution arrangement shall equal the default percentage
specified by resolution of the Board multiplied by the
employee's compensation as defined by the plan, subject to any
contribution limits applicable to the plan, and shall be made
on a pre-tax basis. An employee subject to this subsection (c)
shall have 30 days from the date on which the System provides
written notice to the employee to elect to not participate in
the eligible deferred compensation plan or to elect to
increase or reduce the amount of initial elective deferrals
made to the plan. In the absence of such affirmative election,
the employee shall be automatically enrolled in the plan
beginning the first day of the calendar month, or as soon as
administratively practicable thereafter, following the 30th
day from the date on which the System provides the required
notice.
(d) The System may provide that the default percentage for
any employee automatically enrolled in the eligible deferred
compensation plan under subsection (b) or (c) be increased by
a specified percentage each plan year after the plan year in
which the employee is automatically enrolled in the plan. The
amount of automatic annual increases in any plan year shall
not exceed 1% of compensation as defined by the plan.
(e) The changes made to this Section by this amendatory
Act of the 102nd General Assembly are corrections of existing
law and are intended to be retroactive to the effective date of
Public Act 100-769, notwithstanding Section 1-103.1 of this
Code.
(Source: P.A. 102-540, eff. 8-20-21.)
(40 ILCS 5/16-204)
Sec. 16-204. Optional defined contribution benefit. As
soon as practicable after the effective date of this
amendatory Act of the 100th General Assembly, the System shall
offer a defined contribution benefit to active members of the
System. The defined contribution benefit shall be an optional
benefit to any member who chooses to participate. The defined
contribution benefit shall collect optional employee and
optional employer contributions into an account and shall
offer investment options to the participant. The benefit under
this Section shall be operated in full compliance with any
applicable State and federal laws, and the System shall
utilize generally accepted practices in creating and
maintaining the benefit for the best interest of the
participants. In administering the defined contribution
benefit, the System shall require that the defined
contribution benefit recordkeeper agree that, in performing
services with respect to the defined contribution benefit, the
recordkeeper: (i) will not use information received as a
result of providing services with respect to the defined
contribution benefit or the participants in the defined
contribution benefit to solicit the participants in the
defined contribution benefit for the purpose of cross-selling
nonplan products and services, unless in response to a request
by a participant in the defined contribution benefit; and (ii)
will not promote, recommend, endorse, or solicit participants
in the defined contribution benefit to purchase any financial
products or services outside of the defined contribution
benefit, except that links to parts of the recordkeeper's
website that are generally available to the public, are about
commercial products, and may be encountered by a participant
in the regular course of navigating the recordkeeper's website
will not constitute a violation of this item (ii). The System
may use funds from the employee and employer contributions to
defray any and all costs of creating and maintaining the
benefit. In addition, the System may use funds provided under
Section 16-158 of this Code to defray any and all costs of
creating and maintaining the benefit and then shall reimburse
those costs from funds received from the employee and employer
contributions under this Section. All employers must comply
with the reporting and administrative functions established by
the System and are required to implement the benefits
established under this Section. The System shall produce an
annual report on the participation in the benefit and shall
make the report public.
As soon as is practicable on or after January 1, 2022, the
System shall automatically enroll any employee who first
becomes an active member or participant in the System. A
member automatically enrolled under this Section shall have 3%
of his or her pre-tax gross compensation for each compensation
period deferred into his or her deferred compensation account,
unless the member otherwise instructs the System on forms
approved by the System. A member may elect, in a manner
provided for by the System, to not participate in the defined
contribution benefit or to increase or reduce the amount of
pre-tax gross compensation contributed, consistent with State
or federal law. A member shall be automatically enrolled in
the benefit beginning the first day of the pay period
following the member's 30th day of employment. A member who
has been automatically enrolled in the benefit may elect,
within 90 days of enrollment, to withdraw from the benefit and
receive a refund of amounts deferred, plus or minus any
applicable earnings, investment fees, and administrative fees.
Any refunded amount shall be included in the member's gross
income for the taxable year in which the refund is issued.
On or after January 1, 2023, the System may elect to
increase the automatic annual contributions under this
Section. The increase in the rate of contribution, however,
shall not exceed 2% of a member's pre-tax gross compensation
per year, and at no time shall any total contribution exceed
any contribution limits established by State or federal law.
(Source: P.A. 102-540, eff. 8-20-21.)
(40 ILCS 5/24-104) (from Ch. 108 1/2, par. 24-104)
Sec. 24-104. State Employees Deferred Compensation Plan.
In this Section, "Plan" means the State Employees Deferred
Compensation Plan.
The Illinois State Board of Investment created under
Article 22A of this Act shall develop and establish a deferred
compensation plan for employees of the State which shall be
known as the State Employees Deferred Compensation Plan. The
Plan shall provide for the Board to review proposed investment
offerings and shall require that only investments determined
to be acceptable by the Board may be used for investing
compensation deferred.
The Plan shall include appropriate provisions pertaining
to its day to day operation providing for methods of electing
to defer income, methods of changing the amount of income to be
deferred, methods of selecting from among investment options
available under the plan and such other provisions as may be
appropriate.
In administering the Plan, the Board shall require that
the Plan recordkeeper agree that, in performing services with
respect to the Plan, the recordkeeper: (i) will not use
information received as a result of providing services with
respect to the Plan or the Plan's participants to solicit the
Plan's participants for the purpose of cross-selling non-Plan
products and services, unless in response to a request by a
Plan participant; and (ii) will not promote, recommend,
endorse, or solicit Plan participants to purchase any
financial products or services outside of the Plan, except
that links to parts of the recordkeeper's website that are
generally available to the public, are about commercial
products, and may be encountered by a Plan participant in the
regular course of navigating the recordkeeper's website will
not constitute a violation of this item (ii).
The Plan shall provide for the preparation, and
distribution from time to time to all eligible State
employees, of pamphlets describing the Plan and outlining the
options and opportunities available to State employees under
the Plan.
The Plan established under this Section shall not be
implemented or amended until the Board is satisfied that
compensation deferred under the Plan is not subject to income
tax for the year in which it is earned and that the taxation of
such compensation will be deferred until the time of its
distribution to the employee.
The Board shall also review and oversee the administration
of the Plan.
(Source: P.A. 81-671.)
(40 ILCS 5/24-107) (from Ch. 108 1/2, par. 24-107)
Sec. 24-107. Local government plans.
(a) Any unit of local government or school district may
establish for its employees a deferred compensation plan
program. Participation shall be by written agreement between
each employee and the legislative authority of the unit of
local government or school district providing for the deferral
of such compensation and the subsequent investment and
administration of such funds.
(b) Any unit of local government may establish an
employer-funded money purchase retirement plan for those of
its full time employees who are not eligible to participate in
any pension fund or retirement system established under
Articles 2 through 18 of this Code. Contributions to the plan
shall be made by the unit of local government only from general
purpose funds not derived from real property taxes imposed by
the unit, at a rate to be determined from time to time by the
unit of local government. However, the rate of employer
contribution shall be (i) the same for all employees
participating in the plan, and (ii) not more than 10% of the
employee's salary.
Any benefits accruing to the participants in a retirement
plan established under this subsection shall be protected from
impairment in accordance with Article XIII, Section 5 of the
Illinois Constitution. However, the unit of local government
establishing such a plan may terminate it at any time, unless
it has otherwise contractually agreed with its participating
employees.
(c) The agency or department designated by the unit of
local government or school district to establish and
administer a plan or program authorized under subsection (a)
or (b) of this Section may invest the assets of the plan in
investments deemed appropriate by the agency or department,
including but not limited to life insurance or annuity
contracts, and share or share certificate accounts of State or
federal credit unions, the accounts of which are insured as
required by the Illinois Credit Union Act or the Federal
Credit Union Act, whichever is applicable. The payment of
employer contributions to a retirement plan established under
subsection (b), and investment and payment to a participant of
deferred compensation and income or gain thereon, if any,
shall not be construed to be prohibited uses of the general
assets of the unit of local government or school district.
This Section does not limit the power or authority of any
unit of local government, school district or any institution
supported in whole or in part by public funds to establish and
administer any other deferred compensation plans that may be
authorized by law and deemed appropriate by the officials of
such subdivisions or institutions.
(d) In administering the deferred compensation plans
authorized under this Section, the governing board or
administrators of the sponsoring unit of local government or
school district shall require that the deferred compensation
plan recordkeeper agree that, in performing services with
respect to the deferred compensation plan, the recordkeeper:
(i) will not use information received as a result of providing
services with respect to the deferred compensation plan or the
deferred compensation plan's participants to solicit the
participants in the deferred compensation plan for the purpose
of cross-selling nonplan products and services, unless in
response to a request by a participant in the deferred
compensation plan; and (ii) will not promote, recommend,
endorse, or solicit participants in the deferred compensation
plan to purchase any financial products or services outside of
the deferred compensation plan, except that links to parts of
the recordkeeper's website that are generally available to the
public, are about commercial products, and may be encountered
by a Plan participant in the regular course of navigating the
recordkeeper's website will not constitute a violation of this
item (ii).
(Source: P.A. 87-794.)
Section 2-10. The University Employees Custodial Accounts
Act is amended by changing Section 2 as follows:
(110 ILCS 95/2) (from Ch. 144, par. 1702)
Sec. 2. The governing board of any public institution of
higher education has the power to establish a defined
contribution plan to make payments to custodial accounts for
investment in regulated investment company stock to provide
retirement benefits as described in Section 403(b)(7) of the
Internal Revenue Code for eligible employees of such
institutions. Such payments shall be made with funds made
available by deductions from or reductions in salary or wages
of eligible employees who authorize in writing deductions or
reductions for such purpose. Such stock shall be purchased
only from persons authorized to sell such stock in this State.
In administering the defined contribution plan, the
governing board of any public institution of higher education
shall require that the defined contribution plan recordkeeper
agree that, in performing services with respect to the defined
contribution plan, the recordkeeper: (i) will not use
information received as a result of providing services with
respect to the defined contribution plan or the participants
in the defined contribution plan to solicit the participants
in the defined contribution plan for the purpose of
cross-selling nonplan products and services, unless in
response to a request by a participant in the defined
contribution plan; and (ii) will not promote, recommend,
endorse, or solicit participants in the defined contribution
plan to purchase any financial products or services outside of
the defined contribution plan, except that links to parts of
the recordkeeper's website that are generally available to the
public, are about commercial products, and may be encountered
by a participant in the regular course of navigating the
recordkeeper's website will not constitute a violation of this
item (ii). However, a public institution of higher education
may allow promotion of limited services if the public
institution of higher education receives no compensation from
the recordkeeper for promoting or providing such services.
Such limited services may include educational, counseling,
debt reduction, student loan repayment or forgiveness, or
other services intended to enhance retirement savings
opportunities. Such limited services may not include credit
cards, life insurance, or banking products.
(Source: P.A. 83-261.)
Article 3.
Section 3-5. The Illinois Pension Code is amended by
changing Section 1-167 as follows:
(40 ILCS 5/1-167)
Sec. 1-167. Prohibited disclosures. No pension fund or
retirement system subject to this Code shall disclose the
following information of any members or participants of any
pension fund or retirement system: (1) the individual's home
address (including ZIP code and county); (2) the individual's
date of birth; (3) the individual's home and personal phone
number; (4) the individual's personal email address; (5)
personally identifying member or participant deduction
information; or (6) any membership status in a labor
organization or other voluntary association affiliated with a
labor organization or labor federation (including whether
participants are members of such organization, the identity of
such organization, whether or not participants pay or
authorize the payment of any dues or moneys to such
organization, and the amounts of such dues or moneys).
This Section does not apply to disclosures (i) required
under the Freedom of Information Act, (ii) for purposes of
conducting public operations or business, or (iii) to a labor
organization or other voluntary association affiliated with a
labor organization or labor federation or to the Municipal
Employees Society of Chicago.
(Source: P.A. 101-620, eff. 12-20-19.)
Article 4.
Section 4-5. The Illinois Pension Code is amended by
changing Section 24-105.2 as follows:
(40 ILCS 5/24-105.2)
Sec. 24-105.2. Automatic enrollment for certain employees.
The Department of Central Management Services shall
automatically enroll in the State Employees Deferred
Compensation Plan any employee who, on or after July 1, 2020,
becomes an active member or participant of a retirement system
created under Article 2, 14, or 18. Any agency with employees
subject to automatic enrollment must systematically provide
the employee data necessary for enrollment to the Department
of Central Management Services or its designee. An employee
automatically enrolled under this Section shall have 3% of his
or her pre-tax gross compensation for each compensation period
deferred into his or her deferred compensation account. The
Board may increase the default percentage amount of
compensation deferred into employee accounts.
An employee hired on or after January 1, 2024 shall be
automatically enrolled in the Plan beginning the first day of
the pay period following the close of the notice period,
unless the employee elects otherwise within the notice period.
During the notice period, an employee may elect to not
participate in the Plan or to increase or reduce the amount of
pre-tax gross compensation deferred. For the purposes of this
Section, "notice period" means a reasonable period of time
after the employee is provided with an automatic enrollment
notice as required under Section 414(w) of the Internal
Revenue Code of 1986, as amended. An employee who has been
automatically enrolled in the Plan may elect, within 90 days
after enrollment, to withdraw from the Plan and receive a
refund of amounts deferred, plus or minus any applicable
earnings, investment fees, and administrative fees. An
employee making such an election shall forfeit all employer
matching contributions, if any, made prior to the election.
Any refunded amount shall be included in the employee's gross
income for the taxable year in which the refund is issued.
An employee hired on or after July 1, 2020 and before
January 1, 2024 shall have 30 days from the start date of
employment to elect to not participate in the deferred
compensation plan or to elect to increase or reduce the amount
of pre-tax gross compensation deferred. An employee shall be
automatically enrolled in the Plan beginning the first day of
the pay period following the employee's thirtieth day of
employment. An employee who has been automatically enrolled in
the Plan may elect, within 90 days of enrollment, to withdraw
from the Plan and receive a refund of amounts deferred, plus or
minus any applicable earnings, investment fees, and
administrative fees. An employee making such an election shall
forfeit all employer matching contributions, if any, made
prior to the election. Any refunded amount shall be included
in the employee's gross income for the taxable year in which
the refund is issued.
As soon as practicable, the Board shall establish annual,
automatic increases to employee contribution rates for
employees who are automatically enrolled in the Plan pursuant
to this Section. The amount of automatic annual increases in
any 12-month period shall not exceed 1% of compensation.
Employees may elect to not receive automatic annual increases
in a manner described by the Board.
(Source: P.A. 101-277, eff. 1-1-20; 102-219, eff. 7-30-21.)
Article 5.
Section 5-5. The Illinois Pension Code is amended by
changing Sections 22C-115, 22C-116, 22C-119, and 22C-123 as
follows:
(40 ILCS 5/22C-115)
Sec. 22C-115. Board of Trustees of the Fund.
(a) No later than February 1, 2020 (one month after the
effective date of Public Act 101-610) or as soon thereafter as
may be practicable, the Governor shall appoint, by and with
the advice and consent of the Senate, a transition board of
trustees consisting of 9 members as follows:
(1) three members representing municipalities and fire
protection districts who are mayors, presidents, chief
executive officers, chief financial officers, or other
officers, executives, or department heads of
municipalities or fire protection districts and appointed
from among candidates recommended by the Illinois
Municipal League;
(2) three members representing participants who are
participants and appointed from among candidates
recommended by the statewide labor organization
representing firefighters employed by at least 85
municipalities that is affiliated with the Illinois State
Federation of Labor;
(3) one member representing beneficiaries who is a
beneficiary and appointed from among the candidate or
candidates recommended by the statewide labor organization
representing firefighters employed by at least 85
municipalities that is affiliated with the Illinois State
Federation of Labor;
(4) one member recommended by the Illinois Municipal
League; and
(5) one member who is a participant recommended by the
statewide labor organization representing firefighters
employed by at least 85 municipalities and that is
affiliated with the Illinois State Federation of Labor.
The transition board members shall serve until the initial
permanent board members are elected and qualified.
The transition board of trustees shall select the
chairperson of the transition board of trustees from among the
trustees for the duration of the transition board's tenure.
(b) The permanent board of trustees shall consist of 9
members comprised as follows:
(1) Three members who are mayors, presidents, chief
executive officers, chief financial officers, or other
officers, executives, or department heads of
municipalities or fire protection districts that have
participating pension funds and are elected by the mayors
and presidents of municipalities or fire protection
districts that have participating pension funds.
(2) Three members who are participants of
participating pension funds and elected by the
participants of participating pension funds.
(3) One member who is a beneficiary of a participating
pension fund and is elected by the beneficiaries of
participating pension funds.
(4) One member recommended by the Illinois Municipal
League who shall be appointed by the Governor with the
advice and consent of the Senate.
(5) One member recommended by the statewide labor
organization representing firefighters employed by at
least 85 municipalities and that is affiliated with the
Illinois State Federation of Labor who shall be appointed
by the Governor with the advice and consent of the Senate.
The permanent board of trustees shall select the
chairperson of the permanent board of trustees from among the
trustees for a term of 2 years. The holder of the office of
chairperson shall alternate between a person elected or
appointed under item (1) or (4) of this subsection (b) and a
person elected or appointed under item (2), (3), or (5) of this
subsection (b).
(c) Each trustee shall qualify by taking an oath of office
before the Secretary of State or the Board's appointed legal
counsel stating that he or she will diligently and honestly
administer the affairs of the board and will not violate or
knowingly permit the violation of any provision of this
Article.
(d) Trustees shall receive no salary for service on the
board but shall be reimbursed for travel expenses incurred
while on business for the board according to the standards in
effect for members of the Commission on Government Forecasting
and Accountability.
A municipality or fire protection district employing a
firefighter who is an elected or appointed trustee of the
board must allow reasonable time off with compensation for the
firefighter to conduct official business related to his or her
position on the board, including time for travel. The board
shall notify the municipality or fire protection district in
advance of the dates, times, and locations of this official
business. The Fund shall timely reimburse the municipality or
fire protection district for the reasonable costs incurred
that are due to the firefighter's absence.
(e) No trustee shall have any interest in any brokerage
fee, commission, or other profit or gain arising out of any
investment directed by the board. This subsection does not
preclude ownership by any member of any minority interest in
any common stock or any corporate obligation in which an
investment is directed by the board.
(f) Notwithstanding any provision or interpretation of law
to the contrary, any member of the transition board may also be
elected or appointed as a member of the permanent board.
Notwithstanding any provision or interpretation of law to
the contrary, any trustee of a fund established under Article
4 of this Code may also be appointed as a member of the
transition board or elected or appointed as a member of the
permanent board.
The restriction in Section 3.1 of the Lobbyist
Registration Act shall not apply to a member of the transition
board appointed pursuant to items (4) or (5) of subsection (a)
or to a member of the permanent board appointed pursuant to
items (4) or (5) of subsection (b).
(Source: P.A. 101-610, eff. 1-1-20; 102-558, eff. 8-20-21.)
(40 ILCS 5/22C-116)
Sec. 22C-116. Conduct and administration of elections;
terms of office.
(a) For the election of the permanent trustees, the
transition board shall administer the initial elections and
the permanent board shall administer all subsequent elections.
Each board shall develop and implement such procedures as it
determines to be appropriate for the conduct of such
elections. For the purposes of obtaining information necessary
to conduct elections under this Section, participating pension
funds shall cooperate with the Fund.
(b) All nominations for election shall be by petition.
Each petition for a trustee shall be executed as follows:
(1) for trustees to be elected by the mayors and
presidents of municipalities or fire protection districts
that have participating pension funds, by at least 20 such
mayors and presidents; except that this item (1) shall
apply only with respect to participating pension funds;
(2) for trustees to be elected by participants, by at
least 400 participants; and
(3) for trustees to be elected by beneficiaries, by at
least 100 beneficiaries.
(c) A separate ballot shall be used for each class of
trustee. The board shall prepare and send ballots and ballot
envelopes to the participants and beneficiaries eligible
voters to vote in accordance with rules adopted by the board.
The ballots shall contain the names of all candidates in
alphabetical order. The ballot envelope shall have on the
outside a form of certificate stating that the person voting
the ballot is a participant or beneficiary entitled to vote.
Eligible voters Participants and beneficiaries, upon
receipt of the ballot, shall vote the ballot and place it in
the ballot envelope, seal the envelope, execute the
certificate thereon, and return the ballot to the Fund.
The board shall set a final date for ballot return, and
ballots received prior to that date in a ballot envelope with a
properly executed certificate and properly voted shall be
valid ballots.
The board shall set a day for counting the ballots and name
judges and clerks of election to conduct the count of ballots
and shall make any rules necessary for the conduct of the
count.
The candidate or candidates receiving the highest number
of votes for each class of trustee shall be elected. In the
case of a tie vote, the winner shall be determined in
accordance with procedures developed by the Department of
Insurance.
In lieu of conducting elections via mail balloting as
described in this Section, the board may instead adopt rules
to provide for elections to be carried out solely via Internet
balloting or phone balloting. Nothing in this Section
prohibits the Fund from contracting with a third party to
administer the election in accordance with this Section.
(d) At any election, voting shall be as follows:
(1) Each person authorized to vote for an elected
trustee may cast one vote for each related position for
which such person is entitled to vote and may cast such
vote for any candidate or candidates on the ballot for
such trustee position.
(2) If only one candidate for each position is
properly nominated in petitions received, that candidate
shall be deemed the winner and no election under this
Section shall be required.
(3) The results shall be entered in the minutes of the
first meeting of the board following the tally of votes.
(e) The initial election for permanent trustees shall be
held and the permanent board shall be seated no later than 12
months after the effective date of this amendatory Act of the
101st General Assembly. Each subsequent election shall be held
no later than 30 days prior to the end of the term of the
incumbent trustees.
(f) The elected trustees shall each serve for terms of 4
years commencing on the first business day of the first month
after election; except that the terms of office of the
initially elected trustees shall be as follows:
(1) One trustee elected pursuant to item (1) of
subsection (b) of Section 22C-115 shall serve for a term
of 2 years and 2 trustees elected pursuant to item (1) of
subsection (b) of Section 22C-115 shall serve for a term
of 4 years;
(2) One trustee elected pursuant to item (2) of
subsection (b) of Section 22C-115 shall serve for a term
of 2 years and 2 trustees elected pursuant to item (2) of
subsection (b) of Section 22C-115 shall serve for a term
of 4 years; and
(3) The trustee elected pursuant to item (3) of
subsection (b) of Section 22C-115 shall serve for a term
of 2 years.
(g) The trustees appointed pursuant to items (4) and (5)
of subsection (b) of Section 22C-115 shall each serve for a
term of 4 years commencing on the first business day of the
first month after the election of the elected trustees.
(h) A member of the board who was elected pursuant to item
(1) of subsection (b) of Section 22C-115 who ceases to serve as
a mayor, president, chief executive officer, chief financial
officer, or other officer, executive, or department head of a
municipality or fire protection district that has a
participating pension fund shall not be eligible to serve as a
member of the board and his or her position shall be deemed
vacant. A member of the board who was elected by the
participants of participating pension funds who ceases to be a
participant may serve the remainder of his or her elected
term.
For a vacancy of an elected trustee occurring with an
unexpired term of 6 months or more, an election shall be
conducted for the vacancy in accordance with Section 22C-115
and this Section.
For a vacancy of an elected trustee occurring with an
unexpired term of less than 6 months, the vacancy shall be
filled by appointment by the board for the unexpired term as
follows: a vacancy of a member elected pursuant to item (1) of
subsection (b) of Section 22C-115 shall be filled by a mayor,
president, chief executive officer, chief financial officer,
or other officer, executive, or department head of a
municipality or fire protection district that has a
participating pension fund; a vacancy of a member elected
pursuant to item (2) of subsection (b) of Section 22C-115
shall be filled by a participant of a participating pension
fund; and a vacancy of a member elected under item (3) of
subsection (b) of Section 22C-115 shall be filled by a
beneficiary of a participating pension fund. A trustee
appointed to fill the vacancy of an elected trustee shall
serve until a successor is elected. Special elections to fill
the remainder of an unexpired term vacated by an elected
trustee shall be held concurrently with and in the same manner
as the next regular election for an elected trustee position.
Vacancies among the appointed trustees shall be filled for
unexpired terms by appointment in like manner as for the
original appointments.
(Source: P.A. 101-610, eff. 1-1-20.)
(40 ILCS 5/22C-119)
Sec. 22C-119. Adoption of rules. The board shall adopt
such rules (not inconsistent with this Code) as in its
judgment are desirable to implement and properly administer
this Article. Such rules shall specifically provide for the
following: (1) the implementation of the transition process
described in Section 22C-120; (2) the process by which the
participating pension funds may request transfer of funds; (3)
the process for the transfer in, receipt for, and investment
of pension assets received by the Fund after the transition
period from the participating pension funds; (4) the process
by which contributions from municipalities and fire protection
districts for the benefit of the participating pension funds
may, but are not required to, be directly transferred to the
Fund; and (5) compensation and benefits for its employees. A
copy of the rules adopted by the Fund shall be posted on the
Fund's website filed with the Secretary of State and the
Department of Insurance. The adoption and effectiveness of
such rules shall not be subject to Article 5 of the Illinois
Administrative Procedure Act.
(Source: P.A. 101-610, eff. 1-1-20.)
(40 ILCS 5/22C-123)
Sec. 22C-123. Custodian. The pension fund assets
transferred to or otherwise acquired by the Fund shall be
placed in the custody of a custodian who shall provide
adequate safe deposit facilities for those assets and hold all
such securities, funds, and other assets subject to the order
of the Fund.
Each custodian shall furnish a corporate surety bond of
such amount as the board designates, which bond shall
indemnify the Fund, the board, and the officers and employees
of the Fund against any loss that may result from any action or
failure to act by the custodian or any of the custodian's
agents, or provide insurance coverages of such type and limits
as the board designates. All charges incidental to the
procuring and giving of any bond shall be paid by the board and
each bond shall be in the custody of the board.
(Source: P.A. 101-610, eff. 1-1-20.)
Article 6.
Section 6-5. The Illinois Pension Code is amended by
changing Section 8-165 as follows:
(40 ILCS 5/8-165) (from Ch. 108 1/2, par. 8-165)
Sec. 8-165. Re-entry into service.
(a) Except as provided in subsection (c) or (d), when an
employee receiving age and service or prior service annuity
who has withdrawn from service after the effective date
re-enters service before age 65, any annuity previously
granted and any annuity fixed for his wife shall be cancelled.
The employee shall be credited for annuity purposes with sums
sufficient to provide annuities equal to those cancelled, as
of their ages on the date of re-entry; provided, the maximum
age of the wife for this purpose shall be as provided in
Section 8-155 of this Article.
The sums so credited shall provide for annuities to be
fixed and granted in the future. Contributions by the
employees and the city for the purposes of this Article shall
be made, and when the proper time arrives, as provided in this
Article, new annuities based upon the total credit for annuity
purposes and the entire term of his service shall be fixed for
the employee and his wife.
If the employee's wife died before he re-entered service,
no part of any credits for widow's or widow's prior service
annuity at the time annuity for his wife was fixed shall be
credited upon re-entry into service, and no such sums shall
thereafter be used to provide such annuity.
(b) Except as provided in subsection (c) or (d), when an
employee re-enters service after age 65, payments on account
of any annuity previously granted shall be suspended during
the time thereafter that he is in service, and when he again
withdraws, annuity payments shall be resumed. If the employee
dies in service, his widow shall receive the amount of annuity
previously fixed for her.
(c) For school years beginning on or after July 1, 2021, an
age and service or prior service annuity shall not be
cancelled in the case of an employee who is re-employed by the
Board of Education of the city as a Special Education
Classroom Assistant or Classroom Assistant on a temporary and
non-annual basis or on an hourly basis so long as the person:
(1) does not work for compensation on more than 120 days in a
school year; or (2) does not accept gross compensation for the
re-employment in a school year in excess of $30,000. These
limitations apply only to school years that begin on or after
July 1, 2021. Re-employment under this subsection does not
require contributions, result in service credit being earned
or granted, or constitute active participation in the Fund.
(d) For school years beginning on or after July 1, 2023, an
age and service or prior service annuity shall not be
cancelled in the case of an employee who is re-employed by the
Board of Education of the city as a paraprofessional or
related service provider on a temporary and non-annual basis
or on an hourly basis so long as the person: (1) does not work
for compensation on more than 120 days in a school year; or (2)
does not accept gross compensation for the re-employment in a
school year in excess of $30,000. These limitations apply only
to school years that begin on or after July 1, 2023.
Re-employment under this subsection does not require
contributions, result in service credit being earned or
granted, or constitute active participation in the Fund.
(Source: P.A. 102-342, eff. 8-13-21.)
Article 7.
Section 7-5. The School Code is amended by changing
Section 24-6.3 as follows:
(105 ILCS 5/24-6.3) (from Ch. 122, par. 24-6.3)
Sec. 24-6.3. Retirement trustee leave.
(a) Each school board employing a teacher who is an
elected trustee of the Teachers' Retirement System of the
State of Illinois shall make available to the elected trustee
at least 20 days of paid leave of absence per year for the
purpose of attending meetings of the System's Board of
Trustees, committee meetings of such Board, and seminars
regarding issues for which such Board is responsible. The
Teachers' Retirement System of the State of Illinois shall
reimburse affected school districts for the actual cost of
hiring a substitute teacher during such leaves of absence.
(b) Each school board employing an employee who is an
elected trustee of the Illinois Municipal Retirement Fund
shall make available to the elected trustee at least 20 days of
paid leave of absence per year for the purpose of attending
meetings of the Fund's Board of Trustees, committee meetings
of the Board of Trustees, and seminars regarding issues for
which the Board of Trustees is responsible. The Illinois
Municipal Retirement Fund may reimburse affected school
districts for the actual cost of hiring a substitute employee
during such leaves of absence.
(c) The school board established under Article 34 and
employers under Article 17 of the Illinois Pension Code shall
make available to each active teacher who is an elected
trustee of the Board of Trustees of the Public School
Teachers' Pension and Retirement Fund of Chicago established
under Article 17 of the Illinois Pension Code up to 22 days of
paid leave of absence per year for the purpose of attending
meetings of the Board of Trustees, committee meetings of the
Board of Trustees, and seminars regarding issues for which the
Board of Trustees is responsible. The allocation of the days
of paid leave shall be at the discretion of the Board of
Trustees of the Public School Teachers' Pension and Retirement
Fund of Chicago.
(Source: P.A. 96-357, eff. 8-13-09.)
Article 8.
Section 8-5. The Illinois Pension Code is amended by
changing Section 16-155 as follows:
(40 ILCS 5/16-155) (from Ch. 108 1/2, par. 16-155)
Sec. 16-155. Report to system and payment of deductions.
(a) The employer governing body of each school district
shall submit to the System all required reports and make two
deposits each month. The deposit for member contributions for
salary paid during any between the first and the fifteenth of
the month is due by the 10th 25th of the following month.
Additionally, all The deposit of member contributions for
salary paid between the sixteenth and last day of the month is
due by the 10th of the following month. All required
contributions for salary earned during a school term are due
by July 10 next following the close of such school term.
The governing body of each State institution coming under
this retirement system, the State Comptroller or other State
officer certifying payroll vouchers including payments of
salary or wages to teachers, and any other employer of
teachers, shall, monthly, forward to the secretary of the
retirement system the member contributions required under this
Article.
Each employer specified above shall, prior to August 15 of
each year, forward to the System a detailed statement,
verified in all cases of school districts by the secretary or
clerk of the district, of the amounts so contributed since the
period covered by the last previous annual statement, together
with required contributions not yet forwarded, such payments
being payable to the System.
The board may prescribe rules governing the form, content,
investigation, control, and supervision of such statements and
may establish additional interim employer reporting
requirements as the Board deems necessary. If no teacher in a
school district comes under the provisions of this Article,
the governing body of the district shall so state under the
oath of its secretary to this system, and shall at the same
time forward a copy of the statement to the regional
superintendent of schools.
The board may also require reporting requirements that are
different than those prescribed in this Section and may
require different reporting requirements for different
benefits or purposes established under this Article,
including, but not limited to, any optional benefit plan an
employee chooses to participate in.
(b) If the governing body of an employer that is not a
State agency fails to forward such required contributions
within the time permitted in subsection (a) above, the System
shall notify the employer of an additional amount due, equal
to $50 per day for each day that elapses from the due date
until the day such report and employee contributions are
received by the System.
(c) If the system, on August 15, is not in receipt of the
detailed statements required under this Section of any school
district or other employing unit, such school district or
other employing unit shall pay to the system an amount equal to
$250 for each day that elapses from August 15, until the day
such statement is filed with the system.
(Source: P.A. 101-502, eff. 8-23-19.)
Article 9.
Section 9-5. The Illinois Pension Code is amended by
changing Sections 9-108.3 and 9-161 as follows:
(40 ILCS 5/9-108.3)
Sec. 9-108.3. In service. "In service": Any period during
which contributions are being made to the Fund on behalf of an
employee except for temporary election work as described in
subsection (c) of Section 9-161.
(Source: P.A. 99-578, eff. 7-15-16.)
(40 ILCS 5/9-161) (from Ch. 108 1/2, par. 9-161)
Sec. 9-161. Re-entry into service. (a) When an employee
who has withdrawn from service after the effective date
re-enters service before age 65, any annuity previously
granted and any annuity fixed for his wife shall be cancelled.
The employee shall be credited for annuity purposes with the
actuarial value of annuities equal to those cancelled as of
their ages on the date of re-entry; provided, the maximum age
of the wife for this purpose shall be as provided in Section
9-151 of this Article. The sums so credited shall provide for
annuities to be fixed and granted in the future. Contributions
by the employee and the county for the purposes of this Article
shall be made and when the proper time arrives, as provided in
this Article, new annuities based upon the total sums
accumulated to his credit for annuity purposes and the entire
term of his service shall be fixed for the employee and his
wife.
If the employee's wife has died before he re-entered
service, no part of any credits for widow's or widow's prior
service annuity at the time annuity for his wife was fixed
shall be credited upon re-entry into service, and no such sums
shall thereafter be used to provide such annuity.
(b) When an employee re-enters service after age 65,
payments on account of any annuity previously granted shall be
suspended during the time thereafter that he is in service,
and when he again withdraws annuity payments shall be resumed.
If the employee dies in service, his widow shall receive the
annuity previously fixed for her.
(c) If an employee annuitant re-enters service as an
election worker and provides services for a scheduled federal,
State, or local election for a period of 60 days or less during
a calendar year, that employee annuitant's annuity shall not
be suspended and such employee annuitant shall not be
considered to be in service within the meaning of Section
9-108.3 and is not entitled to benefits for employees in
service. If an employee annuitant re-enters service for a
period longer than 60 days during a calendar year, the annuity
shall be suspended or cancelled retroactive to the initial
date of re-entry.
(Source: P.A. 81-1536.)
Article 10.
Section 10-5. The Illinois Pension Code is amended by
changing Section 17-133 as follows:
(40 ILCS 5/17-133) (from Ch. 108 1/2, par. 17-133)
Sec. 17-133. Contributions for periods of outside and
other service. Regularly certified and appointed teachers who
desire to have the following described services credited for
pension purposes shall submit to the Board evidence thereof
and pay into the Fund the amounts prescribed herein:
1. For teaching service by a certified teacher in the
public schools of the several states or in schools
operated by or under the auspices of the United States, a
teacher shall pay the contributions at the rates in force
(a) on the date of appointment as a regularly certified
teacher after salary adjustments are completed, or (b) at
the time of reappointment after salary adjustments are
completed, whichever is later, but not less than $450 per
year of service. Upon the Board's approval of such service
and the payment of the required contributions, service
credit of not more than 10 years shall be granted.
2. For service as a playground instructor in public
school playgrounds, teachers shall pay the contributions
prescribed in this Article (a) at the time of appointment,
as a regularly certified teacher after salary adjustments
are completed, or (b) on return to service as a full time
regularly certified teacher, as the case may be, provided
such rates or amounts shall not be less than $450 per year.
3. For service prior to September 1, 1955, in the
public schools of the City as a substitute, evening school
or temporary teacher, or for service as an Americanization
teacher prior to December 31, 1955, teachers shall pay the
contributions prescribed in this Article (a) at the time
of appointment, as a regularly certified teacher after
salary adjustments are completed, (b) on return to service
as a full time regularly certified teacher, as the case
may be, provided such rates or amounts shall not be less
than $450 per year; and provided further that for teachers
employed on or after September 1, 1953, rates shall not
include contributions for widows' pensions if the service
described in this sub-paragraph 3 was rendered before that
date. Any teacher entitled to repay a refund of
contributions under Section 17-126 may validate service
described in this paragraph by payment of the amounts
prescribed herein, together with the repayment of the
refund, provided that if such creditable service was the
last service rendered in the public schools of the City
and is not automatically reinstated by repayment of the
refund, the rates or amounts shall not be less than $450
per year.
4. For service after June 30, 1982 as a member of the
Board of Education, if required to resign from an
administrative or teaching position in order to qualify as
a member of the Board of Education.
5. For service during the 1986-87 school year as a
teacher on a special leave of absence with full loss of
salary, teaching for an agency under contract to the Board
of Education, if the teacher returned to employment in
September, 1987. For service under this item 5, the
teacher must pay the contributions at the rates in force
at the completion of the leave period.
6. For up to 2 years of service as a teacher or
administrator employed by a private school registered with
or recognized by the Illinois State Board of Education,
provided that the teacher (i) was certified under the law
governing the certification of teachers at the time the
service was rendered, (ii) applies in writing no later
than 2 years after the effective date of this amendatory
Act of the 102nd General Assembly, (iii) supplies
satisfactory evidence of the employment, (iv) completes at
least 10 years of contributing service as a teacher as
defined in Section 17-106, (v) pays the contribution
required in this Section, and (vi) does not receive credit
for that service under any other provision of this Code.
The member may apply for credit under this subsection and
pay the required contribution before completing the 10
years of contributing service required under item (iv),
but the credit may not be used until the item (iv)
contributing service requirement has been met.
For each year of service credit to be established
under this subparagraph 6, a member is required to
contribute to the System (i) the employee and employer
contribution that would have been required had such
service been rendered as a member based on the annual
salary rate during the first year of full-time employment
as a teacher under this Article following the private
school service, plus (ii) interest thereon at the
actuarially assumed rate from the date of first full-time
employment as a teacher under this Article following the
private school service to the date of payment, compounded
annually, at a rate determined by the Board.
For service described in sub-paragraphs 1, 2 and 3 of this
Section, interest shall be charged beginning one year after
the effective date of appointment or reappointment.
Effective September 1, 1974, the interest rate to be
charged by the Fund on contributions provided in
sub-paragraphs 1, 2, 3 and 4 shall be 5% per annum compounded
annually.
(Source: P.A. 102-822, eff. 5-13-22.)
Article 99.
Section 99-90. The State Mandates Act is amended by adding
Section 8.47 as follows:
(30 ILCS 805/8.47 new)
Sec. 8.47. Exempt mandate. Notwithstanding Sections 6 and
8 of this Act, no reimbursement by the State is required for
the implementation of any mandate created by this amendatory
Act of the 103rd General Assembly.
Section 99-99. Effective date. This Act takes effect upon
becoming law.