103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB2102

 

Introduced 2/9/2023, by Sen. Robert F. Martwick

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/1A-104
40 ILCS 5/5-226 rep.
40 ILCS 5/6-220 rep.

    Amends the Illinois Pension Code. In the Regulation of Public Pension Funds Article, provides that the Consolidated Fund (instead of the Public Pension Division of the Department of Insurance or the Consolidated Fund, as appropriate) shall examine or investigate each pension fund established under the Downstate Police or Downstate Firefighter Article of the Code. In the Chicago Police and Chicago Firefighter Articles, repeals provisions requiring the Director of Insurance to biennially make a thorough examination of the Fund and issue a report. Effective July 1, 2023.


LRB103 26034 RPS 52389 b

 

 

A BILL FOR

 

SB2102LRB103 26034 RPS 52389 b

1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by
5changing Section 1A-104 as follows:
 
6    (40 ILCS 5/1A-104)
7    Sec. 1A-104. Examinations and investigations.
8    (a) Except as described in this Section the following
9paragraph with respect to pension funds established under
10Article 3 or 4 of this Code, the Division shall make periodic
11examinations and investigations of all pension funds
12established under this Code and maintained for the benefit of
13employees and officers of governmental units in the State of
14Illinois. However, in lieu of making an examination and
15investigation, the Division may accept and rely upon a report
16of audit or examination of any pension fund made by an
17independent certified public accountant pursuant to the
18provisions of the Article of this Code governing the pension
19fund. The acceptance of the report of audit or examination
20does not bar the Division from making a further audit,
21examination, and investigation if deemed necessary by the
22Division.
23    For pension funds established under Article 3 or 4 of this

 

 

SB2102- 2 -LRB103 26034 RPS 52389 b

1Code: (i) prior to the conclusion of the transition period,
2the Division shall make the periodic examinations and
3investigations described in the preceding paragraph; and (ii)
4after the conclusion of the transition period, the Division
5may accept and rely upon a report of audit or examination of
6such pension fund made by an independent certified public
7accountant retained by the Consolidated Fund. The acceptance
8of the report of audit or examination does not bar the Division
9from making a further audit, examination, and investigation if
10deemed necessary by the Division.
11    The Department may implement a flexible system of
12examinations under which it directs resources as it deems
13necessary or appropriate. In consultation with the pension
14fund being examined, the Division may retain attorneys,
15independent actuaries, independent certified public
16accountants, and other professionals and specialists as
17examiners, the cost of which (except in the case of pension
18funds established under Article 3 or 4) shall be borne by the
19pension fund that is the subject of the examination.
20    (b) The Division or the Consolidated Fund, as appropriate,
21shall examine or investigate each pension fund established
22under Article 3 or Article 4 of this Code. The schedule of each
23examination shall be such that each fund shall be examined
24once every 3 years.
25    Each examination shall include the following:
26        (1) an audit of financial transactions, investment

 

 

SB2102- 3 -LRB103 26034 RPS 52389 b

1    policies, and procedures;
2        (2) an examination of books, records, documents,
3    files, and other pertinent memoranda relating to
4    financial, statistical, and administrative operations;
5        (3) a review of policies and procedures maintained for
6    the administration and operation of the pension fund;
7        (4) a determination of whether or not full effect is
8    being given to the statutory provisions governing the
9    operation of the pension fund;
10        (5) a determination of whether or not the
11    administrative policies in force are in accord with the
12    purposes of the statutory provisions and effectively
13    protect and preserve the rights and equities of the
14    participants;
15        (6) a determination of whether or not proper financial
16    and statistical records have been established and adequate
17    documentary evidence is recorded and maintained in support
18    of the several types of annuity and benefit payments being
19    made; and
20        (7) a determination of whether or not the calculations
21    made by the fund for the payment of all annuities and
22    benefits are accurate.
23    In addition, the Division or the Consolidated Fund, as
24appropriate, may conduct investigations, which shall be
25identified as such and which may include one or more of the
26items listed in this subsection.

 

 

SB2102- 4 -LRB103 26034 RPS 52389 b

1    A copy of the report of examination or investigation as
2prepared by the Division or the Consolidated Fund, as
3appropriate, shall be submitted to the secretary of the board
4of trustees of the pension fund examined or investigated and
5to the chief executive officer of the municipality. The
6Director, upon request, shall grant a hearing to the officers
7or trustees of the pension fund and to the officers or trustees
8of the Consolidated Fund, as appropriate, or their duly
9appointed representatives, upon any facts contained in the
10report of examination. The hearing shall be conducted before
11filing the report or making public any information contained
12in the report. The Director may withhold the report from
13public inspection for up to 60 days following the hearing.
14(Source: P.A. 101-610, eff. 1-1-20.)
 
15    (40 ILCS 5/5-226 rep.)
16    (40 ILCS 5/6-220 rep.)
17    Section 10. The Illinois Pension Code is amended by
18repealing Sections 5-226 and 6-220.
 
19    Section 99. Effective date. This Act takes effect July 1,
202023.