103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB3683

 

Introduced 2/9/2024, by Sen. Robert F. Martwick

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/9-242 new
40 ILCS 5/10-110 new
40 ILCS 5/13-314.5 new
30 ILCS 805/8.48 new

    Amends the Cook County, Cook County Forest Preserve District, and Metropolitan Water Reclamation District (MWRD) Articles of the Illinois Pension Code. Provides that the employer shall provide a federal tax qualified pre-tax retirement plan otherwise allowed by State and federal law for each employee. Provides that the employer shall automatically enroll employees who become employees or after January 1, 2025 into a federal tax qualified pre-tax retirement plan. Provides for a default contribution amount; collective bargaining; a retirement savings committee; plan document; review of the plan document by the Public Pension Division of the Department of Insurance; and fees charged by the Public Pension Division of the Department of Insurance to the municipality. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.


LRB103 39183 RPS 69329 b

 

 

A BILL FOR

 

SB3683LRB103 39183 RPS 69329 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 adding
5Sections 9-242, 10-110, and 13-314.5 as follows:
 
6    (40 ILCS 5/9-242 new)
7    Sec. 9-242. Automatic enrollment in optional savings plan.
8    (a) On and after January 1, 2025, the county must provide a
9federal tax qualified pre-tax retirement plan otherwise
10allowed by State and federal law for each employee. Any
11employee who becomes an employee on or after January 1, 2025
12must be automatically enrolled in the federal tax qualified
13pre-tax retirement plan established under this Section;
14however, an employee may opt out of the federal tax qualified
15pre-tax retirement plan, as provided in this Section.
16    (b) If another option is not chosen by the employee,
17collective bargaining unit, or a retirement savings committee,
18the default employee contribution to this account shall be 2%
19of salary. Any employee may terminate participation in the
20benefit at any time, subject to any restrictions posted within
21the plan document. The plan shall be designed to receive
22employee contributions, but may also receive employer
23contributions based on the decision of the county. The

 

 

SB3683- 2 -LRB103 39183 RPS 69329 b

1administration of this benefit shall be a permissive subject
2of collective bargaining; however, if the county offers the
3same benefit to employees under multiple collective bargaining
4units, then the county may create a retirement savings
5committee that shall include one representative appointed by
6each collective bargaining unit and one representative
7appointed by the president of the county. If there is a
8retirement savings committee, the committee shall approve of
9the administration of this benefit by affirmative vote prior
10to the creation or change of the benefit. The county may
11contract with outside parties to administer or offer this
12benefit. The cost of offering this benefit shall be borne by
13the participants in the benefit; however, the county may
14absorb incidental and normal costs, including, but not limited
15to, staff time, information technology, meeting space, or
16minor administrative costs.
17    (c) The county shall create or cause to be created a
18benefit plan document, which shall have, at a minimum, an
19overview of the costs for participants under the plan, the
20name of the administrator of the plan, an overview of the
21benefits of the plan, and all options allowed under the plan.
22    (d) The county shall distribute the plan document to
23participants or possible participants as well as to the Public
24Pension Division of the Department of Insurance by February 1
25of each year. The Public Pension Division of the Department of
26Insurance shall review the plan document to determine whether

 

 

SB3683- 3 -LRB103 39183 RPS 69329 b

1the plan document represents best practices. If the Public
2Pension Division of the Department of Insurance determines
3that an aspect of the plan document does not represent best
4practices, the Public Pension Division of the Department of
5Insurance shall inform the county and the employees of the
6county covered under this Section. The Public Pension Division
7of the Department of Insurance shall create an annual report
8of any plan that does not use best practices. The Department of
9Insurance shall adopt rules to implement and administer this
10Section. The Public Pension Division of the Department of
11Insurance may charge fees to the county to administer this
12Section. The Public Pension Division of the Department of
13Insurance may charge the extra costs associated with the
14county's failure to use best practices directly to the county.
 
15    (40 ILCS 5/10-110 new)
16    Sec. 10-110. Automatic enrollment in optional savings
17plan.
18    (a) On and after January 1, 2025, the District must
19provide a federal tax qualified pre-tax retirement plan
20otherwise allowed by State and federal law for each employee.
21Any employee who becomes an employee on or after January 1,
222025 must be automatically enrolled in the federal tax
23qualified pre-tax retirement plan established under this
24Section; however, an employee may opt out of the federal tax
25qualified pre-tax retirement plan, as provided in this

 

 

SB3683- 4 -LRB103 39183 RPS 69329 b

1Section.
2    (b) If another option is not chosen by the employee,
3collective bargaining unit, or a retirement savings committee,
4the default employee contribution to this account shall be 2%
5of salary. Any employee may terminate participation in the
6benefit at any time, subject to any restrictions posted within
7the plan document. The plan shall be designed to receive
8employee contributions, but may also receive employer
9contributions based on the decision of the District. The
10administration of this benefit shall be a permissive subject
11of collective bargaining; however, if the District offers the
12same benefit to employees under multiple collective bargaining
13units, then the District may create a retirement savings
14committee that shall include one representative appointed by
15each collective bargaining unit and one representative
16appointed by the president of the county. If there is a
17retirement savings committee, the committee shall approve of
18the administration of this benefit by affirmative vote prior
19to the creation or change of the benefit. The District may
20contract with outside parties to administer or offer this
21benefit. The cost of offering this benefit shall be borne by
22the participants in the benefit; however, the District may
23absorb incidental and normal costs, including, but not limited
24to, staff time, information technology, meeting space, or
25minor administrative costs.
26    (c) The District shall create or cause to be created a

 

 

SB3683- 5 -LRB103 39183 RPS 69329 b

1benefit plan document, which shall have, at a minimum, an
2overview of the costs for participants under the plan, the
3name of the administrator of the plan, an overview of the
4benefits of the plan, and all options allowed under the plan.
5    (d) The District shall distribute the plan document to
6participants or possible participants as well as to the Public
7Pension Division of the Department of Insurance by February 1
8of each year. The Public Pension Division of the Department of
9Insurance shall review the plan document to determine whether
10the plan document represents best practices. If the Public
11Pension Division of the Department of Insurance determines
12that an aspect of the plan document does not represent best
13practices, the Public Pension Division of the Department of
14Insurance shall inform the District and the employees of the
15District covered under this Section. The Public Pension
16Division of the Department of Insurance shall create an annual
17report of any plan that does not use best practices. The
18Department of Insurance shall adopt rules to implement and
19administer this Section. The Public Pension Division of the
20Department of Insurance may charge fees to the District to
21administer this Section. The Public Pension Division of the
22Department of Insurance may charge the extra costs associated
23with the District's failure to use best practices directly to
24the District.
 
25    (40 ILCS 5/13-314.5 new)

 

 

SB3683- 6 -LRB103 39183 RPS 69329 b

1    Sec. 13-314.5. Automatic enrollment in optional savings
2plan.
3    (a) On and after January 1, 2025, the Employer must
4provide a federal tax qualified pre-tax retirement plan
5otherwise allowed by State and federal law for each employee.
6Any employee who becomes an employee on or after January 1,
72025 must be automatically enrolled in the federal tax
8qualified pre-tax retirement plan established under this
9Section; however, an employee may opt out of the federal tax
10qualified pre-tax retirement plan, as provided in this
11Section.
12    (b) If another option is not chosen by the employee,
13collective bargaining unit, or a retirement savings committee,
14the default employee contribution to this account shall be 2%
15of salary. Any employee may terminate participation in the
16benefit at any time, subject to any restrictions posted within
17the plan document. The plan shall be designed to receive
18employee contributions, but may also receive employer
19contributions based on the decision of the Employer. The
20administration of this benefit shall be a permissive subject
21of collective bargaining; however, if the Employer offers the
22same benefit to employees under multiple collective bargaining
23units, then the Employer may create a retirement savings
24committee that shall include one representative appointed by
25each collective bargaining unit and one representative
26appointed by the President of the Metropolitan Water

 

 

SB3683- 7 -LRB103 39183 RPS 69329 b

1Reclamation District Board of Commissioners. If there is a
2retirement savings committee, the committee shall approve of
3the administration of this benefit by affirmative vote prior
4to the creation or change of the benefit. The Employer may
5contract with outside parties to administer or offer this
6benefit. The cost of offering this benefit shall be borne by
7the participants in the benefit; however, the Employer may
8absorb incidental and normal costs, including, but not limited
9to, staff time, information technology, meeting space, or
10minor administrative costs.
11    (c) The Employer shall create or cause to be created a
12benefit plan document, which shall have, at a minimum, an
13overview of the costs for participants under the plan, the
14name of the administrator of the plan, an overview of the
15benefits of the plan, and all options allowed under the plan.
16    (d) The Employer shall distribute the plan document to
17participants or possible participants as well as to the Public
18Pension Division of the Department of Insurance by February 1
19of each year. The Public Pension Division of the Department of
20Insurance shall review the plan document to determine whether
21the plan document represents best practices. If the Public
22Pension Division of the Department of Insurance determines
23that an aspect of the plan document does not represent best
24practices, the Public Pension Division of the Department of
25Insurance shall inform the Employer and the employees covered
26under this Section. The Public Pension Division of the

 

 

SB3683- 8 -LRB103 39183 RPS 69329 b

1Department of Insurance shall create an annual report of any
2plan that does not use best practices. The Department of
3Insurance shall adopt rules to implement and administer this
4Section. The Public Pension Division of the Department of
5Insurance may charge fees to the Employer to administer this
6Section. The Public Pension Division of the Department of
7Insurance may charge the extra costs associated with the
8Employer's failure to use best practices directly to the
9Employer.
 
10    Section 90. The State Mandates Act is amended by adding
11Section 8.48 as follows:
 
12    (30 ILCS 805/8.48 new)
13    Sec. 8.48. Exempt mandate. Notwithstanding Sections 6 and
148 of this Act, no reimbursement by the State is required for
15the implementation of any mandate created by this amendatory
16Act of the 103rd General Assembly.
 
17    Section 99. Effective date. This Act takes effect upon
18becoming law.