IL
Illinois Senate Bill SB1459

Illinois 2025-2026 Regular Session

Illinois Senate Bill SB1459 Compare Versions

Only one version of the bill is available at this time.
OldNewDifferences
11 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB1459 Introduced 1/31/2025, by Sen. Robert F. Martwick SYNOPSIS AS INTRODUCED: 30 ILCS 167/3030 ILCS 168/15 Amends the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003. Provides that, upon a distributor's failure to submit certain information, the Attorney General may send a notice of violation to the distributor and provide 10 days to cure the violation. Provides that, if the distributor does not cure the violation, the Attorney General may notify the Director of Revenue of the violation, and, upon receiving the Attorney General's notice, the Director of Revenue shall revoke the distributor's license. Amends the Tobacco Product Manufacturers' Escrow Act. Provides that a tobacco product manufacturer that elects to place funds into escrow may make an irrevocable assignment of its interest in the funds to the benefit of the State. LRB104 06248 HLH 16283 b A BILL FOR 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB1459 Introduced 1/31/2025, by Sen. Robert F. Martwick SYNOPSIS AS INTRODUCED: 30 ILCS 167/3030 ILCS 168/15 30 ILCS 167/30 30 ILCS 168/15 Amends the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003. Provides that, upon a distributor's failure to submit certain information, the Attorney General may send a notice of violation to the distributor and provide 10 days to cure the violation. Provides that, if the distributor does not cure the violation, the Attorney General may notify the Director of Revenue of the violation, and, upon receiving the Attorney General's notice, the Director of Revenue shall revoke the distributor's license. Amends the Tobacco Product Manufacturers' Escrow Act. Provides that a tobacco product manufacturer that elects to place funds into escrow may make an irrevocable assignment of its interest in the funds to the benefit of the State. LRB104 06248 HLH 16283 b LRB104 06248 HLH 16283 b A BILL FOR
22 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB1459 Introduced 1/31/2025, by Sen. Robert F. Martwick SYNOPSIS AS INTRODUCED:
33 30 ILCS 167/3030 ILCS 168/15 30 ILCS 167/30 30 ILCS 168/15
44 30 ILCS 167/30
55 30 ILCS 168/15
66 Amends the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003. Provides that, upon a distributor's failure to submit certain information, the Attorney General may send a notice of violation to the distributor and provide 10 days to cure the violation. Provides that, if the distributor does not cure the violation, the Attorney General may notify the Director of Revenue of the violation, and, upon receiving the Attorney General's notice, the Director of Revenue shall revoke the distributor's license. Amends the Tobacco Product Manufacturers' Escrow Act. Provides that a tobacco product manufacturer that elects to place funds into escrow may make an irrevocable assignment of its interest in the funds to the benefit of the State.
77 LRB104 06248 HLH 16283 b LRB104 06248 HLH 16283 b
88 LRB104 06248 HLH 16283 b
99 A BILL FOR
1010 SB1459LRB104 06248 HLH 16283 b SB1459 LRB104 06248 HLH 16283 b
1111 SB1459 LRB104 06248 HLH 16283 b
1212 1 AN ACT concerning finance.
1313 2 Be it enacted by the People of the State of Illinois,
1414 3 represented in the General Assembly:
1515 4 Section 5. The Tobacco Products Manufacturers' Escrow
1616 5 Enforcement Act of 2003 is amended by changing Section 30 as
1717 6 follows:
1818 7 (30 ILCS 167/30)
1919 8 Sec. 30. Penalties and other remedies.
2020 9 (a) In addition to or in lieu of any other civil or
2121 10 criminal remedy provided by law, upon a determination that a
2222 11 distributor has violated subsection (e) of Section 15 or any
2323 12 regulation adopted pursuant thereto, the Director may revoke
2424 13 or suspend the license of any distributor in the manner
2525 14 provided by Section 6 of the Cigarette Tax Act, Section 6 of
2626 15 the Cigarette Use Tax Act, or Section 10-25 of the Tobacco
2727 16 Products Tax Act of 1995, as appropriate. Each stamp affixed
2828 17 and each offer to sell cigarettes in violation of subsection
2929 18 (e) of Section 15 shall constitute a separate violation. For
3030 19 each violation, the Director may also impose a civil penalty
3131 20 in an amount not to exceed the greater of 500% of the retail
3232 21 value of the cigarettes sold or $5,000 upon a determination of
3333 22 violation of subsection (e) of Section 15 or any regulations
3434 23 adopted pursuant thereto.
3535
3636
3737
3838 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 SB1459 Introduced 1/31/2025, by Sen. Robert F. Martwick SYNOPSIS AS INTRODUCED:
3939 30 ILCS 167/3030 ILCS 168/15 30 ILCS 167/30 30 ILCS 168/15
4040 30 ILCS 167/30
4141 30 ILCS 168/15
4242 Amends the Tobacco Products Manufacturers' Escrow Enforcement Act of 2003. Provides that, upon a distributor's failure to submit certain information, the Attorney General may send a notice of violation to the distributor and provide 10 days to cure the violation. Provides that, if the distributor does not cure the violation, the Attorney General may notify the Director of Revenue of the violation, and, upon receiving the Attorney General's notice, the Director of Revenue shall revoke the distributor's license. Amends the Tobacco Product Manufacturers' Escrow Act. Provides that a tobacco product manufacturer that elects to place funds into escrow may make an irrevocable assignment of its interest in the funds to the benefit of the State.
4343 LRB104 06248 HLH 16283 b LRB104 06248 HLH 16283 b
4444 LRB104 06248 HLH 16283 b
4545 A BILL FOR
4646
4747
4848
4949
5050
5151 30 ILCS 167/30
5252 30 ILCS 168/15
5353
5454
5555
5656 LRB104 06248 HLH 16283 b
5757
5858
5959
6060
6161
6262
6363
6464
6565
6666 SB1459 LRB104 06248 HLH 16283 b
6767
6868
6969 SB1459- 2 -LRB104 06248 HLH 16283 b SB1459 - 2 - LRB104 06248 HLH 16283 b
7070 SB1459 - 2 - LRB104 06248 HLH 16283 b
7171 1 (b) Any cigarettes that have been sold, offered for sale,
7272 2 or possessed for sale in this State, or imported for personal
7373 3 consumption in this State in violation of subsection (e) of
7474 4 Section 15 shall be subject to seizure and forfeiture as
7575 5 provided in Sections 18, 18a, and 20 of the Cigarette Tax Act
7676 6 and Sections 24, 25, 25a and 26 of the Cigarette Use Tax Act,
7777 7 and all cigarettes so seized and forfeited shall be destroyed
7878 8 and not resold.
7979 9 (c) The Attorney General may seek an injunction to
8080 10 restrain a threatened or actual violation of subsection (e) of
8181 11 Section 15, subsection (a) of Section 25, or subsection (d) of
8282 12 Section 25 by a distributor and to compel the distributor to
8383 13 comply with such subsections. In any action brought pursuant
8484 14 to this Section, the State shall be entitled to recover the
8585 15 costs of investigation, costs of the action, and reasonable
8686 16 attorney fees.
8787 17 (c-5) Upon a distributor's failure to submit information
8888 18 as required by subsection (a) of Section 25 or subsection (d)
8989 19 of Section 25, the Attorney General may send a notice of
9090 20 violation to the distributor and provide the distributor with
9191 21 10 days to cure the violation. If the distributor does not cure
9292 22 the violation, the Attorney General may notify the Director of
9393 23 the violation, and, upon receiving the Attorney General's
9494 24 notice, the Director shall revoke the distributor's license.
9595 25 (d) It shall be unlawful for a person to: (i) sell or
9696 26 distribute cigarettes; or (ii) acquire, hold, own, possess,
9797
9898
9999
100100
101101
102102 SB1459 - 2 - LRB104 06248 HLH 16283 b
103103
104104
105105 SB1459- 3 -LRB104 06248 HLH 16283 b SB1459 - 3 - LRB104 06248 HLH 16283 b
106106 SB1459 - 3 - LRB104 06248 HLH 16283 b
107107 1 transport, import, or cause to be imported cigarettes that the
108108 2 person knows or should know are intended for distribution or
109109 3 sale in the State in violation of subsection (e) of Section 15.
110110 4 A violation of this Section shall be a Class 2 felony.
111111 5 (e) A person who violates subsection (e) of Section 15
112112 6 engages in an unfair and deceptive trade practice in violation
113113 7 of the Uniform Deceptive Trade Practices Act.
114114 8 (Source: P.A. 93-446, eff. 1-1-04; 93-930, eff. 1-1-05;
115115 9 94-575, eff. 8-12-05.)
116116 10 Section 10. The Tobacco Product Manufacturers' Escrow Act
117117 11 is amended by changing Section 15 as follows:
118118 12 (30 ILCS 168/15)
119119 13 Sec. 15. Requirements.
120120 14 (a) Any tobacco product manufacturer selling cigarettes to
121121 15 consumers within the State of Illinois (whether directly or
122122 16 through a distributor, retailer, or similar intermediary or
123123 17 intermediaries) after the effective date of this Act shall do
124124 18 one of the following:
125125 19 (1) become a participating manufacturer (as that term
126126 20 is defined in Section II(jj) of the Master Settlement
127127 21 Agreement) and generally perform its financial obligations
128128 22 under the Master Settlement Agreement; or
129129 23 (2) (A) place into a qualified escrow fund by April 15
130130 24 of the year following the year in question the
131131
132132
133133
134134
135135
136136 SB1459 - 3 - LRB104 06248 HLH 16283 b
137137
138138
139139 SB1459- 4 -LRB104 06248 HLH 16283 b SB1459 - 4 - LRB104 06248 HLH 16283 b
140140 SB1459 - 4 - LRB104 06248 HLH 16283 b
141141 1 following amounts (as such amounts are adjusted for
142142 2 inflation):
143143 3 (i) For 1999: $0.0094241 per unit sold after
144144 4 the effective date of this Act;
145145 5 (ii) For 2000: $0.0104712 per unit sold;
146146 6 (iii) For each of 2001 and 2002: $0.0136125
147147 7 per unit sold;
148148 8 (iv) For each of 2003 through 2006: $0.0167539
149149 9 per unit sold;
150150 10 (v) For each of 2007 and each year thereafter:
151151 11 $0.0188482 per unit sold.
152152 12 (B) A tobacco product manufacturer that places
153153 13 funds into escrow pursuant to subdivision (a)(2)(A)
154154 14 shall receive the interest or other appreciation on
155155 15 the funds as earned. The funds themselves shall be
156156 16 released from escrow only under the following
157157 17 circumstances:
158158 18 (i) to pay a judgment or settlement on any
159159 19 released claim brought against the tobacco product
160160 20 manufacturer by the State or any releasing party
161161 21 located or residing in the State. Funds shall be
162162 22 released from escrow under this subdivision
163163 23 (a)(2)(B)(i): (I) in the order in which they were
164164 24 placed into escrow; and (II) only to the extent
165165 25 and at the time necessary to make payments
166166 26 required under such judgment or settlement;
167167
168168
169169
170170
171171
172172 SB1459 - 4 - LRB104 06248 HLH 16283 b
173173
174174
175175 SB1459- 5 -LRB104 06248 HLH 16283 b SB1459 - 5 - LRB104 06248 HLH 16283 b
176176 SB1459 - 5 - LRB104 06248 HLH 16283 b
177177 1 (ii) to the extent that a tobacco product
178178 2 manufacturer establishes that the amount it was
179179 3 required to place into escrow on account of units
180180 4 sold in the State in a particular year was greater
181181 5 than the Master Settlement Agreement payments, as
182182 6 determined pursuant to Section IX(i) of that
183183 7 Agreement, including after final determination of
184184 8 all adjustments, that such manufacturer would have
185185 9 been required to make on account of such units
186186 10 sold had it been a Participating Manufacturer, the
187187 11 excess shall be released from escrow and revert
188188 12 back to such tobacco product manufacturer; or
189189 13 (iii) to the extent not released from escrow
190190 14 under subdivisions (a)(2)(B)(i) or (a)(2)(B)(ii),
191191 15 funds shall be released from escrow and revert
192192 16 back to such tobacco product manufacturer 25 years
193193 17 after the date on which they were placed into
194194 18 escrow.
195195 19 (C) Each tobacco product manufacturer that elects
196196 20 to place funds into escrow pursuant to this
197197 21 subdivision (a)(2) shall annually certify to the
198198 22 Attorney General that it is in compliance with this
199199 23 subdivision (a)(2). The Attorney General may bring a
200200 24 civil action on behalf of the State of Illinois
201201 25 against any tobacco product manufacturer that fails to
202202 26 place into escrow the funds required under this
203203
204204
205205
206206
207207
208208 SB1459 - 5 - LRB104 06248 HLH 16283 b
209209
210210
211211 SB1459- 6 -LRB104 06248 HLH 16283 b SB1459 - 6 - LRB104 06248 HLH 16283 b
212212 SB1459 - 6 - LRB104 06248 HLH 16283 b
213213 1 subdivision (a)(2). Any tobacco product manufacturer
214214 2 that fails in any year to place into escrow the funds
215215 3 required under this subdivision (a)(2) shall:
216216 4 (i) be required within 15 days to place such
217217 5 funds into escrow as shall bring it into
218218 6 compliance with this Section. The court, upon a
219219 7 finding of a violation of this subdivision (a)(2),
220220 8 may impose a civil penalty to be paid into the
221221 9 General Revenue Fund in an amount not to exceed 5%
222222 10 of the amount improperly withheld from escrow per
223223 11 day of the violation and in a total amount not to
224224 12 exceed 100% of the original amount improperly
225225 13 withheld from escrow;
226226 14 (ii) in the case of a knowing violation, be
227227 15 required within 15 days to place such funds into
228228 16 escrow as shall bring it into compliance with this
229229 17 Section. The court, upon a finding of a knowing
230230 18 violation of this subdivision (a)(2), may impose a
231231 19 civil penalty to be paid into the General Revenue
232232 20 Fund in an amount not to exceed 15% of the amount
233233 21 improperly withheld from escrow per day of the
234234 22 violation and in a total amount not to exceed 300%
235235 23 of the original amount improperly withheld from
236236 24 escrow; and
237237 25 (iii) in the case of a second knowing
238238 26 violation, be prohibited from selling cigarettes
239239
240240
241241
242242
243243
244244 SB1459 - 6 - LRB104 06248 HLH 16283 b
245245
246246
247247 SB1459- 7 -LRB104 06248 HLH 16283 b SB1459 - 7 - LRB104 06248 HLH 16283 b
248248 SB1459 - 7 - LRB104 06248 HLH 16283 b
249249 1 to consumers within the State of Illinois (whether
250250 2 directly or through a distributor, retailer, or
251251 3 similar intermediary) for a period not to exceed 2
252252 4 years.
253253 5 (b) Each failure to make an annual deposit required under
254254 6 this Section shall constitute a separate violation. If a
255255 7 tobacco product manufacturer is successfully prosecuted by the
256256 8 Attorney General for a violation of subdivision (a)(2), the
257257 9 tobacco product manufacturer must pay, in addition to any fine
258258 10 imposed by a court, the State's costs and attorney's fees
259259 11 incurred in the prosecution.
260260 12 (c) Notwithstanding subparagraph (B) of item (2) of
261261 13 subsection (a) of this Section, a tobacco product manufacturer
262262 14 that elects to place funds into escrow pursuant to
263263 15 subparagraph (A) of item (2) of subsection (a) of this Section
264264 16 may make an irrevocable assignment of its interest in the
265265 17 funds to the benefit of the State. The assignment shall be
266266 18 permanent and shall apply to all funds that are in the escrow
267267 19 account or that may subsequently come into the account,
268268 20 including (i) those funds deposited into the escrow account
269269 21 before the assignment is executed, (ii) those funds deposited
270270 22 into the escrow account on or after the date the assignment is
271271 23 executed, and (iii) interest or other appreciation on the
272272 24 funds. The tobacco product manufacturer, the Attorney General,
273273 25 and the financial institution where the escrow account is
274274 26 maintained may make amendments to the qualified escrow account
275275
276276
277277
278278
279279
280280 SB1459 - 7 - LRB104 06248 HLH 16283 b
281281
282282
283283 SB1459- 8 -LRB104 06248 HLH 16283 b SB1459 - 8 - LRB104 06248 HLH 16283 b
284284 SB1459 - 8 - LRB104 06248 HLH 16283 b
285285 1 agreement as necessary to effectuate an assignment of rights
286286 2 executed pursuant to this subsection or a withdrawal of moneys
287287 3 from the escrow account pursuant to subparagraph (B) of item
288288 4 (2) of subsection (a) of this Section. An assignment of rights
289289 5 executed pursuant to this subsection shall be in writing,
290290 6 shall be signed by a duly authorized representative of the
291291 7 tobacco product manufacturer making the assignment, and shall
292292 8 become effective on delivery of the assignment to the Attorney
293293 9 General and the financial institution where the escrow account
294294 10 is maintained. An assignment of escrow funds shall not be made
295295 11 by a tobacco product manufacturer unless and until the
296296 12 Attorney General provides written approval to the tobacco
297297 13 product manufacturer.
298298 14 (d) Notwithstanding subparagraph (B) of item (2) of
299299 15 subsection (a) of this Section, any escrow funds assigned to
300300 16 the State pursuant to subsection (c) shall be withdrawn by the
301301 17 State on the approval of the Attorney General. Any funds
302302 18 withdrawn pursuant to this subsection shall be used to
303303 19 reimburse the State for Medicaid costs and shall be calculated
304304 20 on a dollar-for-dollar basis as a credit against any judgment
305305 21 or settlement described in subparagraph (B) of item (2) of
306306 22 subsection (a) of this Section that may be obtained against
307307 23 the tobacco product manufacturer that has assigned the funds
308308 24 in the escrow account. This Section does not relieve a tobacco
309309 25 product manufacturer from any past, current, or future
310310 26 obligations that the manufacturer may have pursuant to this
311311
312312
313313
314314
315315
316316 SB1459 - 8 - LRB104 06248 HLH 16283 b
317317
318318
319319 SB1459- 9 -LRB104 06248 HLH 16283 b SB1459 - 9 - LRB104 06248 HLH 16283 b
320320 SB1459 - 9 - LRB104 06248 HLH 16283 b
321321
322322
323323
324324
325325
326326 SB1459 - 9 - LRB104 06248 HLH 16283 b