Rep. Michael J. Madigan

Filed: 4/2/2009

 

 


 

 


 
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1
AMENDMENT TO SENATE BILL 364

2     AMENDMENT NO. ______. Amend Senate Bill 364, AS AMENDED, by
3 replacing everything after the enacting clause with the
4 following:
 
5     "Section 5. The Illinois Governmental Ethics Act is amended
6 by changing Sections 4A-101, 4A-102, 4A-106, and 4A-107 as
7 follows:
 
8     (5 ILCS 420/4A-101)  (from Ch. 127, par. 604A-101)
9     Sec. 4A-101. Persons required to file. The following
10 persons shall file verified written statements of economic
11 interests, as provided in this Article:
12         (a) Members of the General Assembly and candidates for
13     nomination or election to the General Assembly.
14         (b) Persons holding an elected office in the Executive
15     Branch of this State, and candidates for nomination or
16     election to these offices.

 

 

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1         (c) Members of a Commission or Board created by the
2     Illinois Constitution, and candidates for nomination or
3     election to such Commission or Board.
4         (d) Persons whose appointment to office is subject to
5     confirmation by the Senate.
6         (e) Holders of, and candidates for nomination or
7     election to, the office of judge or associate judge of the
8     Circuit Court and the office of judge of the Appellate or
9     Supreme Court.
10         (f) Persons who are employed by any branch, agency,
11     authority or board of the government of this State,
12     including but not limited to, the Illinois State Toll
13     Highway Authority, the Illinois Housing Development
14     Authority, the Illinois Community College Board, and
15     institutions under the jurisdiction of the Board of
16     Trustees of the University of Illinois, Board of Trustees
17     of Southern Illinois University, Board of Trustees of
18     Chicago State University, Board of Trustees of Eastern
19     Illinois University, Board of Trustees of Governor's State
20     University, Board of Trustees of Illinois State
21     University, Board of Trustees of Northeastern Illinois
22     University, Board of Trustees of Northern Illinois
23     University, Board of Trustees of Western Illinois
24     University, or Board of Trustees of the Illinois
25     Mathematics and Science Academy, and are compensated for
26     services as employees and not as independent contractors

 

 

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1     and who:
2             (1) are, or function as, the head of a department,
3         commission, board, division, bureau, authority or
4         other administrative unit within the government of
5         this State, or who exercise similar authority within
6         the government of this State;
7             (2) have direct supervisory authority over, or
8         direct responsibility for the formulation,
9         negotiation, issuance or execution of contracts
10         entered into by the State in the amount of $5,000 or
11         more;
12             (3) have authority for the issuance or
13         promulgation of rules and regulations within areas
14         under the authority of the State;
15             (4) have authority for the approval of
16         professional licenses;
17             (5) have responsibility with respect to the
18         financial inspection of regulated nongovernmental
19         entities;
20             (6) adjudicate, arbitrate, or decide any judicial
21         or administrative proceeding, or review the
22         adjudication, arbitration or decision of any judicial
23         or administrative proceeding within the authority of
24         the State;
25             (7) have supervisory responsibility for 20 or more
26         employees of the State; or

 

 

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1             (8) negotiate, assign, authorize, or grant naming
2         rights or sponsorship rights regarding any property or
3         asset of the State, whether real, personal, tangible,
4         or intangible.
5         (g) Persons who are elected to office in a unit of
6     local government, and candidates for nomination or
7     election to that office, including regional
8     superintendents of school districts.
9         (h) Persons appointed to the governing board of a unit
10     of local government, or of a special district, and persons
11     appointed to a zoning board, or zoning board of appeals, or
12     to a regional, county, or municipal plan commission, or to
13     a board of review of any county, and persons appointed to
14     the Board of the Metropolitan Pier and Exposition Authority
15     and any Trustee appointed under Section 22 of the
16     Metropolitan Pier and Exposition Authority Act, and
17     persons appointed to a board or commission of a unit of
18     local government who have authority to authorize the
19     expenditure of public funds. This subsection does not apply
20     to members of boards or commissions who function in an
21     advisory capacity.
22         (i) Persons who are employed by a unit of local
23     government and are compensated for services as employees
24     and not as independent contractors and who:
25             (1) are, or function as, the head of a department,
26         division, bureau, authority or other administrative

 

 

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1         unit within the unit of local government, or who
2         exercise similar authority within the unit of local
3         government;
4             (2) have direct supervisory authority over, or
5         direct responsibility for the formulation,
6         negotiation, issuance or execution of contracts
7         entered into by the unit of local government in the
8         amount of $1,000 or greater;
9             (3) have authority to approve licenses and permits
10         by the unit of local government; this item does not
11         include employees who function in a ministerial
12         capacity;
13             (4) adjudicate, arbitrate, or decide any judicial
14         or administrative proceeding, or review the
15         adjudication, arbitration or decision of any judicial
16         or administrative proceeding within the authority of
17         the unit of local government;
18             (5) have authority to issue or promulgate rules and
19         regulations within areas under the authority of the
20         unit of local government; or
21             (6) have supervisory responsibility for 20 or more
22         employees of the unit of local government.
23         (j) Persons on the Board of Trustees of the Illinois
24     Mathematics and Science Academy.
25         (k) Persons employed by a school district in positions
26     that require that person to hold an administrative or a

 

 

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1     chief school business official endorsement.
2         (l) Special government agents. A "special government
3     agent" is a person who is directed, retained, designated,
4     appointed, or employed, with or without compensation, by or
5     on behalf of a statewide executive branch constitutional
6     officer to make an ex parte communication under Section
7     5-50 of the State Officials and Employees Ethics Act or
8     Section 5-165 of the Illinois Administrative Procedure
9     Act.
10         (m) Members of the board of commissioners of any flood
11     prevention district.
12         (n) Members of the board of any retirement system or
13     investment board established under the Illinois Pension
14     Code, if not required to file under any other provision of
15     this Section.
16         (o) Members of the board of any pension fund
17     established under the Illinois Pension Code, if not
18     required to file under any other provision of this Section.
19     This Section shall not be construed to prevent any unit of
20 local government from enacting financial disclosure
21 requirements that mandate more information than required by
22 this Act.
23 (Source: P.A. 95-719, eff. 5-21-08.)
 
24     (5 ILCS 420/4A-102)  (from Ch. 127, par. 604A-102)
25     Sec. 4A-102. The statement of economic interests required

 

 

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1 by this Article shall include the economic interests of the
2 person making the statement as provided in this Section. The
3 interest (if constructively controlled by the person making the
4 statement) of a spouse or any other party, shall be considered
5 to be the same as the interest of the person making the
6 statement. Campaign receipts shall not be included in this
7 statement.
8         (a) The following interests shall be listed by all
9     persons required to file:
10             (1) The name, address and type of practice of any
11         professional organization or individual professional
12         practice in which the person making the statement was
13         an officer, director, associate, partner or
14         proprietor, or served in any advisory capacity, from
15         which income in excess of $1200 was derived during the
16         preceding calendar year;
17             (2) The nature of professional services (other
18         than services rendered to the unit or units of
19         government in relation to which the person is required
20         to file) and the nature of the entity to which they
21         were rendered if fees exceeding $5,000 were received
22         during the preceding calendar year from the entity for
23         professional services rendered by the person making
24         the statement.
25             (3) The identity (including the address or legal
26         description of real estate) of any capital asset from

 

 

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1         which a capital gain of $5,000 or more was realized in
2         the preceding calendar year.
3             (4) The name of any unit of government which has
4         employed the person making the statement during the
5         preceding calendar year other than the unit or units of
6         government in relation to which the person is required
7         to file.
8             (5) The name of any entity from which a gift or
9         gifts, or honorarium or honoraria, valued singly or in
10         the aggregate in excess of $500, was received during
11         the preceding calendar year.
12         (b) The following interests shall also be listed by
13     persons listed in items (a) through (f), and item (l), and
14     item (n) of Section 4A-101:
15             (1) The name and instrument of ownership in any
16         entity doing business in the State of Illinois, in
17         which an ownership interest held by the person at the
18         date of filing is in excess of $5,000 fair market value
19         or from which dividends of in excess of $1,200 were
20         derived during the preceding calendar year. (In the
21         case of real estate, location thereof shall be listed
22         by street address, or if none, then by legal
23         description). No time or demand deposit in a financial
24         institution, nor any debt instrument need be listed;
25             (2) Except for professional service entities, the
26         name of any entity and any position held therein from

 

 

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1         which income of in excess of $1,200 was derived during
2         the preceding calendar year, if the entity does
3         business in the State of Illinois. No time or demand
4         deposit in a financial institution, nor any debt
5         instrument need be listed.
6             (3) The identity of any compensated lobbyist with
7         whom the person making the statement maintains a close
8         economic association, including the name of the
9         lobbyist and specifying the legislative matter or
10         matters which are the object of the lobbying activity,
11         and describing the general type of economic activity of
12         the client or principal on whose behalf that person is
13         lobbying.
14         (c) The following interests shall also be listed by
15     persons listed in items (g), (h), and (i), and (o) of
16     Section 4A-101:
17             (1) The name and instrument of ownership in any
18         entity doing business with a unit of local government
19         in relation to which the person is required to file if
20         the ownership interest of the person filing is greater
21         than $5,000 fair market value as of the date of filing
22         or if dividends in excess of $1,200 were received from
23         the entity during the preceding calendar year. (In the
24         case of real estate, location thereof shall be listed
25         by street address, or if none, then by legal
26         description). No time or demand deposit in a financial

 

 

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1         institution, nor any debt instrument need be listed.
2             (2) Except for professional service entities, the
3         name of any entity and any position held therein from
4         which income in excess of $1,200 was derived during the
5         preceding calendar year if the entity does business
6         with a unit of local government in relation to which
7         the person is required to file. No time or demand
8         deposit in a financial institution, nor any debt
9         instrument need be listed.
10             (3) The name of any entity and the nature of the
11         governmental action requested by any entity which has
12         applied to a unit of local government in relation to
13         which the person must file for any license, franchise
14         or permit for annexation, zoning or rezoning of real
15         estate during the preceding calendar year if the
16         ownership interest of the person filing is in excess of
17         $5,000 fair market value at the time of filing or if
18         income or dividends in excess of $1,200 were received
19         by the person filing from the entity during the
20         preceding calendar year.
21     For the purposes of this Section, the unit of local
22 government in relation to which a person required to file under
23 item (o) of Section 4A-101 shall be the unit of local
24 government that contributes to the pension fund of which such
25 person is a member of the board.
26 (Source: P.A. 92-101, eff. 1-1-02; 93-617, eff. 12-9-03.)
 

 

 

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1     (5 ILCS 420/4A-106)  (from Ch. 127, par. 604A-106)
2     Sec. 4A-106. The statements of economic interests required
3 of persons listed in items (a) through (f), item (j), and item
4 (l), and item (n) of Section 4A-101 shall be filed with the
5 Secretary of State. The statements of economic interests
6 required of persons listed in items (g), (h), (i), and (k), and
7 (o) of Section 4A-101 shall be filed with the county clerk of
8 the county in which the principal office of the unit of local
9 government with which the person is associated is located. If
10 it is not apparent which county the principal office of a unit
11 of local government is located, the chief administrative
12 officer, or his or her designee, has the authority, for
13 purposes of this Act, to determine the county in which the
14 principal office is located. On or before February 1 annually,
15 (1) the chief administrative officer of any State agency in the
16 executive, legislative, or judicial branch employing persons
17 required to file under item (f) or item (l) of Section 4A-101
18 and the chief administrative officer of a board described in
19 item (n) of Section 4A-101 shall certify to the Secretary of
20 State the names and mailing addresses of those persons, and (2)
21 the chief administrative officer, or his or her designee, of
22 each unit of local government with persons described in items
23 (h), (i) and (k) and a board described in item (o) of Section
24 4A-101 shall certify to the appropriate county clerk a list of
25 names and addresses of persons described in items (h), (i), and

 

 

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1 (k), and (o) of Section 4A-101 that are required to file. In
2 preparing the lists, each chief administrative officer, or his
3 or her designee, shall set out the names in alphabetical order.
4     On or before April 1 annually, the Secretary of State shall
5 notify (1) all persons whose names have been certified to him
6 under items (f), and (l), and (n) of Section 4A-101, and (2)
7 all persons described in items (a) through (e) and item (j) of
8 Section 4A-101, other than candidates for office who have filed
9 their statements with their nominating petitions, of the
10 requirements for filing statements of economic interests. A
11 person required to file with the Secretary of State by virtue
12 of more than one item among items (a) through (f) and items
13 (j), and (l), and (n) shall be notified of and is required to
14 file only one statement of economic interests relating to all
15 items under which the person is required to file with the
16 Secretary of State.
17     On or before April 1 annually, the county clerk of each
18 county shall notify all persons whose names have been certified
19 to him under items (g), (h), (i), and (k), and (o) of Section
20 4A-101, other than candidates for office who have filed their
21 statements with their nominating petitions, of the
22 requirements for filing statements of economic interests. A
23 person required to file with a county clerk by virtue of more
24 than one item among items (g), (h), (i), and (k), and (o) shall
25 be notified of and is required to file only one statement of
26 economic interests relating to all items under which the person

 

 

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1 is required to file with that county clerk.
2     Except as provided in Section 4A-106.1, the notices
3 provided for in this Section shall be in writing and deposited
4 in the U.S. Mail, properly addressed, first class postage
5 prepaid, on or before the day required by this Section for the
6 sending of the notice. A certificate executed by the Secretary
7 of State or county clerk attesting that he has mailed the
8 notice constitutes prima facie evidence thereof.
9     From the lists certified to him under this Section of
10 persons described in items (g), (h), (i), and (k), and (o) of
11 Section 4A-101, the clerk of each county shall compile an
12 alphabetical listing of persons required to file statements of
13 economic interests in his office under any of those items. As
14 the statements are filed in his office, the county clerk shall
15 cause the fact of that filing to be indicated on the
16 alphabetical listing of persons who are required to file
17 statements. Within 30 days after the due dates, the county
18 clerk shall mail to the State Board of Elections a true copy of
19 that listing showing those who have filed statements.
20     The county clerk of each county shall note upon the
21 alphabetical listing the names of all persons required to file
22 a statement of economic interests who failed to file a
23 statement on or before May 1. It shall be the duty of the
24 several county clerks to give notice as provided in Section
25 4A-105 to any person who has failed to file his or her
26 statement with the clerk on or before May 1.

 

 

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1     Any person who files or has filed a statement of economic
2 interest under this Act is entitled to receive from the
3 Secretary of State or county clerk, as the case may be, a
4 receipt indicating that the person has filed such a statement,
5 the date of such filing, and the identity of the governmental
6 unit or units in relation to which the filing is required.
7     The Secretary of State may employ such employees and
8 consultants as he considers necessary to carry out his duties
9 hereunder, and may prescribe their duties, fix their
10 compensation, and provide for reimbursement of their expenses.
11     All statements of economic interests filed under this
12 Section shall be available for examination and copying by the
13 public at all reasonable times. Not later than 12 months after
14 the effective date of this amendatory Act of the 93rd General
15 Assembly, beginning with statements filed in calendar year
16 2004, the Secretary of State shall make statements of economic
17 interests filed with the Secretary available for inspection and
18 copying via the Secretary's website.
19 (Source: P.A. 93-617, eff. 12-9-03; 94-603, eff. 8-16-05.)
 
20     (5 ILCS 420/4A-107)  (from Ch. 127, par. 604A-107)
21     Sec. 4A-107. Any person required to file a statement of
22 economic interests under this Article who willfully files a
23 false or incomplete statement shall be guilty of a Class A
24 misdemeanor.
25     Failure to file a statement within the time prescribed

 

 

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1 shall result in ineligibility for, or forfeiture of, office or
2 position of employment, as the case may be; provided, however,
3 that if the notice of failure to file a statement of economic
4 interests provided in Section 4A-105 of this Act is not given
5 by the Secretary of State or the county clerk, as the case may
6 be, no forfeiture shall result if a statement is filed within
7 30 days of actual notice of the failure to file. The Secretary
8 of State shall provide the Attorney General with the names of
9 persons who failed to file a statement. The county clerk shall
10 provide the State's Attorney of the county of the entity for
11 which the filing of statement of economic interest is required
12 with the name of persons who failed to file a statement.
13     The Attorney General, with respect to offices or positions
14 described in items (a) through (f) and items (j), and (l), and
15 (n) of Section 4A-101 of this Act, or the State's Attorney of
16 the county of the entity for which the filing of statements of
17 economic interests is required, with respect to offices or
18 positions described in items (g) through (i), and item (k), and
19 item (o) of Section 4A-101 of this Act, shall bring an action
20 in quo warranto against any person who has failed to file by
21 either May 31 or June 30 of any given year.
22 (Source: P.A. 93-617, eff. 12-9-03.)
 
23     Section 10. The State Officials and Employees Ethics Act is
24 amended by changing Section 1-5 as follows:
 

 

 

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1     (5 ILCS 430/1-5)
2     Sec. 1-5. Definitions. As used in this Act:
3     "Appointee" means a person appointed to a position in or
4 with a State agency, regardless of whether the position is
5 compensated.
6     "Campaign for elective office" means any activity in
7 furtherance of an effort to influence the selection,
8 nomination, election, or appointment of any individual to any
9 federal, State, or local public office or office in a political
10 organization, or the selection, nomination, or election of
11 Presidential or Vice-Presidential electors, but does not
12 include activities (i) relating to the support or opposition of
13 any executive, legislative, or administrative action (as those
14 terms are defined in Section 2 of the Lobbyist Registration
15 Act), (ii) relating to collective bargaining, or (iii) that are
16 otherwise in furtherance of the person's official State duties.
17     "Candidate" means a person who has filed nominating papers
18 or petitions for nomination or election to an elected State
19 office, or who has been appointed to fill a vacancy in
20 nomination, and who remains eligible for placement on the
21 ballot at either a general primary election or general
22 election.
23     "Collective bargaining" has the same meaning as that term
24 is defined in Section 3 of the Illinois Public Labor Relations
25 Act.
26     "Commission" means an ethics commission created by this

 

 

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1 Act.
2     "Compensated time" means any time worked by or credited to
3 a State employee that counts toward any minimum work time
4 requirement imposed as a condition of employment with a State
5 agency, but does not include any designated State holidays or
6 any period when the employee is on a leave of absence.
7     "Compensatory time off" means authorized time off earned by
8 or awarded to a State employee to compensate in whole or in
9 part for time worked in excess of the minimum work time
10 required of that employee as a condition of employment with a
11 State agency.
12     "Contribution" has the same meaning as that term is defined
13 in Section 9-1.4 of the Election Code.
14     "Employee" means (i) any person employed full-time,
15 part-time, or pursuant to a contract and whose employment
16 duties are subject to the direction and control of an employer
17 with regard to the material details of how the work is to be
18 performed or (ii) any appointed or elected commissioner,
19 trustee, director, or board member of a board of a State
20 agency, including any retirement system or investment board
21 subject to the Illinois Pension Code or (iii) any other
22 appointee.
23     "Executive branch constitutional officer" means the
24 Governor, Lieutenant Governor, Attorney General, Secretary of
25 State, Comptroller, and Treasurer.
26     "Gift" means any gratuity, discount, entertainment,

 

 

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1 hospitality, loan, forbearance, or other tangible or
2 intangible item having monetary value including, but not
3 limited to, cash, food and drink, and honoraria for speaking
4 engagements related to or attributable to government
5 employment or the official position of an employee, member, or
6 officer.
7     "Governmental entity" means a unit of local government
8 (including a community college district) or a school district
9 but not a State agency.
10     "Leave of absence" means any period during which a State
11 employee does not receive (i) compensation for State
12 employment, (ii) service credit towards State pension
13 benefits, and (iii) health insurance benefits paid for by the
14 State.
15     "Legislative branch constitutional officer" means a member
16 of the General Assembly and the Auditor General.
17     "Legislative leader" means the President and Minority
18 Leader of the Senate and the Speaker and Minority Leader of the
19 House of Representatives.
20     "Member" means a member of the General Assembly.
21     "Officer" means an executive branch constitutional officer
22 or a legislative branch constitutional officer.
23     "Political" means any activity in support of or in
24 connection with any campaign for elective office or any
25 political organization, but does not include activities (i)
26 relating to the support or opposition of any executive,

 

 

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1 legislative, or administrative action (as those terms are
2 defined in Section 2 of the Lobbyist Registration Act), (ii)
3 relating to collective bargaining, or (iii) that are otherwise
4 in furtherance of the person's official State duties or
5 governmental and public service functions.
6     "Political organization" means a party, committee,
7 association, fund, or other organization (whether or not
8 incorporated) that is required to file a statement of
9 organization with the State Board of Elections or a county
10 clerk under Section 9-3 of the Election Code, but only with
11 regard to those activities that require filing with the State
12 Board of Elections or a county clerk.
13     "Prohibited political activity" means:
14         (1) Preparing for, organizing, or participating in any
15     political meeting, political rally, political
16     demonstration, or other political event.
17         (2) Soliciting contributions, including but not
18     limited to the purchase of, selling, distributing, or
19     receiving payment for tickets for any political
20     fundraiser, political meeting, or other political event.
21         (3) Soliciting, planning the solicitation of, or
22     preparing any document or report regarding any thing of
23     value intended as a campaign contribution.
24         (4) Planning, conducting, or participating in a public
25     opinion poll in connection with a campaign for elective
26     office or on behalf of a political organization for

 

 

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1     political purposes or for or against any referendum
2     question.
3         (5) Surveying or gathering information from potential
4     or actual voters in an election to determine probable vote
5     outcome in connection with a campaign for elective office
6     or on behalf of a political organization for political
7     purposes or for or against any referendum question.
8         (6) Assisting at the polls on election day on behalf of
9     any political organization or candidate for elective
10     office or for or against any referendum question.
11         (7) Soliciting votes on behalf of a candidate for
12     elective office or a political organization or for or
13     against any referendum question or helping in an effort to
14     get voters to the polls.
15         (8) Initiating for circulation, preparing,
16     circulating, reviewing, or filing any petition on behalf of
17     a candidate for elective office or for or against any
18     referendum question.
19         (9) Making contributions on behalf of any candidate for
20     elective office in that capacity or in connection with a
21     campaign for elective office.
22         (10) Preparing or reviewing responses to candidate
23     questionnaires in connection with a campaign for elective
24     office or on behalf of a political organization for
25     political purposes.
26         (11) Distributing, preparing for distribution, or

 

 

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1     mailing campaign literature, campaign signs, or other
2     campaign material on behalf of any candidate for elective
3     office or for or against any referendum question.
4         (12) Campaigning for any elective office or for or
5     against any referendum question.
6         (13) Managing or working on a campaign for elective
7     office or for or against any referendum question.
8         (14) Serving as a delegate, alternate, or proxy to a
9     political party convention.
10         (15) Participating in any recount or challenge to the
11     outcome of any election, except to the extent that under
12     subsection (d) of Section 6 of Article IV of the Illinois
13     Constitution each house of the General Assembly shall judge
14     the elections, returns, and qualifications of its members.
15     "Prohibited source" means any person or entity who:
16         (1) is seeking official action (i) by the member or
17     officer or (ii) in the case of an employee, by the employee
18     or by the member, officer, State agency, or other employee
19     directing the employee;
20         (2) does business or seeks to do business (i) with the
21     member or officer or (ii) in the case of an employee, with
22     the employee or with the member, officer, State agency, or
23     other employee directing the employee;
24         (3) conducts activities regulated (i) by the member or
25     officer or (ii) in the case of an employee, by the employee
26     or by the member, officer, State agency, or other employee

 

 

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1     directing the employee;
2         (4) has interests that may be substantially affected by
3     the performance or non-performance of the official duties
4     of the member, officer, or employee; or
5         (5) is registered or required to be registered with the
6     Secretary of State under the Lobbyist Registration Act,
7     except that an entity not otherwise a prohibited source
8     does not become a prohibited source merely because a
9     registered lobbyist is one of its members or serves on its
10     board of directors.
11     "State agency" includes all officers, boards, commissions
12 and agencies created by the Constitution, whether in the
13 executive or legislative branch; all officers, departments,
14 boards, commissions, agencies, institutions, authorities,
15 public institutions of higher learning as defined in Section 2
16 of the Higher Education Cooperation Act (except community
17 colleges), and bodies politic and corporate of the State; and
18 administrative units or corporate outgrowths of the State
19 government which are created by or pursuant to statute, other
20 than units of local government (including community college
21 districts) and their officers, school districts, and boards of
22 election commissioners; and all administrative units and
23 corporate outgrowths of the above and as may be created by
24 executive order of the Governor. "State agency" includes the
25 General Assembly, the Senate, the House of Representatives, the
26 President and Minority Leader of the Senate, the Speaker and

 

 

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1 Minority Leader of the House of Representatives, the Senate
2 Operations Commission, and the legislative support services
3 agencies. "State agency" includes the Office of the Auditor
4 General. "State agency" does not include the judicial branch.
5     "State employee" means any employee of a State agency.
6     "Ultimate jurisdictional authority" means the following:
7         (1) For members, legislative partisan staff, and
8     legislative secretaries, the appropriate legislative
9     leader: President of the Senate, Minority Leader of the
10     Senate, Speaker of the House of Representatives, or
11     Minority Leader of the House of Representatives.
12         (2) For State employees who are professional staff or
13     employees of the Senate and not covered under item (1), the
14     Senate Operations Commission.
15         (3) For State employees who are professional staff or
16     employees of the House of Representatives and not covered
17     under item (1), the Speaker of the House of
18     Representatives.
19         (4) For State employees who are employees of the
20     legislative support services agencies, the Joint Committee
21     on Legislative Support Services.
22         (5) For State employees of the Auditor General, the
23     Auditor General.
24         (6) For State employees of public institutions of
25     higher learning as defined in Section 2 of the Higher
26     Education Cooperation Act (except community colleges), the

 

 

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1     board of trustees of the appropriate public institution of
2     higher learning.
3         (7) For State employees of an executive branch
4     constitutional officer other than those described in
5     paragraph (6), the appropriate executive branch
6     constitutional officer.
7         (8) For State employees not under the jurisdiction of
8     paragraph (1), (2), (3), (4), (5), (6), or (7), the
9     Governor.
10 (Source: P.A. 95-880, eff. 8-19-08.)
 
11     Section 12. The State Treasurer Act is amended by adding
12 Section 16.10 as follows:
 
13     (15 ILCS 505/16.10 new)
14     (Section scheduled to be repealed on June 30, 2011)
15     Sec. 16.10. Working group; peer cost comparison. The
16 Treasurer shall convene a working group consisting of
17 representatives from the retirement systems, pension funds,
18 and investment board created under the Illinois Pension Code,
19 persons that provide investment services, and members of the
20 financial industry. The working group shall review the
21 performance of investment managers and consultants providing
22 investment services for the retirement systems, pension funds,
23 and investment board created under the Illinois Pension Code.
24 The group shall develop uniform standards for comparing the

 

 

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1 costs of investment services and make recommendations to the
2 retirement systems, pension funds, and investment board. In
3 performing its functions under this Section, the working group
4 shall work in coordination with the Commission on Government
5 Forecasting and Accountability. The Office of the State
6 Treasurer shall provide administrative assistance to the
7 working group as the group deems necessary and appropriate. The
8 working group shall draft a report, and the Treasurer must
9 submit such report, to the Governor and the General Assembly by
10 January 1, 2011.
11     This Section is repealed on June 30, 2011.
 
12     Section 15. The Illinois Pension Code is amended by
13 changing Sections 1-101.2, 1-109.1, 1-110, 1-113.5, 1-125,
14 14-134, 14-134.1, 15-159, 16-163, 16-164, 16-169, and 22A-109
15 and by adding Sections 1-101.5, 1-113.14, 1-113.16, 1-113.18,
16 1-130, 1-135, 1-145, and 1-150 as follows:
 
17     (40 ILCS 5/1-101.2)
18     Sec. 1-101.2. Fiduciary. A person is a "fiduciary" with
19 respect to a pension fund or retirement system established
20 under this Code to the extent that the person:
21         (1) exercises any discretionary authority or
22     discretionary control respecting management of the pension
23     fund or retirement system, or exercises any authority or
24     control respecting management or disposition of its

 

 

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1     assets;
2         (2) renders investment advice or renders advice on the
3     selection of fiduciaries for a fee or other compensation,
4     direct or indirect, with respect to any moneys or other
5     property of the pension fund or retirement system, or has
6     any authority or responsibility to do so; or
7         (3) has any discretionary authority or discretionary
8     responsibility in the administration of the pension fund or
9     retirement system.
10 (Source: P.A. 90-507, eff. 8-22-97.)
 
11     (40 ILCS 5/1-101.5 new)
12     Sec. 1-101.5. Consultant. "Consultant" means any person or
13 entity retained or employed by the board of a retirement
14 system, pension fund, or investment board to make
15 recommendations in developing an investment strategy, assist
16 with finding appropriate investment advisers, or monitor the
17 board's investments. "Consultant" does not include
18 non-investment related professionals or professionals offering
19 services that are not directly related to the investment of
20 assets, such as legal counsel, actuary, proxy-voting services,
21 services used to track compliance with legal standards, and
22 investment fund of funds where the board has no direct
23 contractual relationship with the investment advisers or
24 partnerships. "Investment adviser" has the meaning ascribed to
25 it in Section 1-101.4.
 

 

 

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1
2     (40 ILCS 5/1-109.1)  (from Ch. 108 1/2, par. 1-109.1)
3     Sec. 1-109.1. Allocation and Delegation of Fiduciary
4 Duties.
5     (1) Subject to the provisions of Section 22A-113 of this
6 Code and subsections (2) and (3) of this Section, the board of
7 trustees of a retirement system or pension fund established
8 under this Code may:
9         (a) Appoint one or more investment managers as
10     fiduciaries to manage (including the power to acquire and
11     dispose of) any assets of the retirement system or pension
12     fund; and
13         (b) Allocate duties among themselves and designate
14     others as fiduciaries to carry out specific fiduciary
15     activities other than the management of the assets of the
16     retirement system or pension fund.
17     (2) The board of trustees of a pension fund established
18 under Article 5, 6, 8, 9, 10, 11, 12 or 17 of this Code may not
19 transfer its investment authority, nor transfer the assets of
20 the fund to any other person or entity for the purpose of
21 consolidating or merging its assets and management with any
22 other pension fund or public investment authority, unless the
23 board resolution authorizing such transfer is submitted for
24 approval to the contributors and pensioners of the fund at
25 elections held not less than 30 days after the adoption of such

 

 

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1 resolution by the board, and such resolution is approved by a
2 majority of the votes cast on the question in both the
3 contributors election and the pensioners election. The
4 election procedures and qualifications governing the election
5 of trustees shall govern the submission of resolutions for
6 approval under this paragraph, insofar as they may be made
7 applicable.
8     (3) Pursuant to subsections (h) and (i) of Section 6 of
9 Article VII of the Illinois Constitution, the investment
10 authority of boards of trustees of retirement systems and
11 pension funds established under this Code is declared to be a
12 subject of exclusive State jurisdiction, and the concurrent
13 exercise by a home rule unit of any power affecting such
14 investment authority is hereby specifically denied and
15 preempted.
16     (4) For the purposes of this Code, "emerging investment
17 manager" means a qualified investment adviser that manages an
18 investment portfolio of at least $10,000,000 but less than
19 $10,000,000,000 $2,000,000,000 and is a "minority owned
20 business", or "female owned business" or "business owned by a
21 person with a disability" as those terms are defined in the
22 Business Enterprise for Minorities, Females, and Persons with
23 Disabilities Act.
24     It is hereby declared to be the public policy of the State
25 of Illinois to encourage the trustees of public employee
26 retirement systems, pension funds, and investment boards to use

 

 

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1 emerging investment managers in managing their system's
2 assets, encompassing all asset classes, and increase the
3 racial, ethnic, and gender diversity of its fiduciaries, to the
4 greatest extent feasible within the bounds of financial and
5 fiduciary prudence, and to take affirmative steps to remove any
6 barriers to the full participation of emerging investment
7 managers in investment opportunities afforded by those
8 retirement systems, pension funds, and investment boards.
9     On or before January 1, 2010, a retirement system, pension
10 fund, or investment board subject to this Code, except those
11 whose investments are restricted by Section 1-113.2 of this
12 Code, shall adopt a policy that sets forth goals for
13 utilization of emerging investment managers. This policy shall
14 include quantifiable goals for the management of assets in
15 specific asset classes by emerging investment managers. The
16 retirement system, pension fund, or investment board shall
17 establish 3 separate goals for: (i) emerging investment
18 managers that are minority owned businesses; (ii) emerging
19 investment managers that are female owned businesses; and (iii)
20 emerging investment managers that are businesses owned by a
21 person with a disability. The goals established shall be based
22 on the percentage of total dollar amount of investment service
23 contracts let to minority owned businesses, female owned
24 businesses, and businesses owned by a person with a disability,
25 as those terms are defined in the Business Enterprise for
26 Minorities, Females, and Persons with Disabilities Act. The

 

 

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1 retirement system, pension fund, or investment board shall
2 annually review the goals established under this subsection.
3     If in any case an emerging investment manager meets the
4 criteria established by a board for a specific search and meets
5 the criteria established by a consultant for that search, then
6 that emerging investment manager shall receive an invitation by
7 the board of trustees, or an investment committee of the board
8 of trustees, to present his or her firm for final consideration
9 of a contract. In the case where multiple emerging investment
10 managers meet the criteria of this Section, the staff may
11 choose the most qualified firm or firms to present to the
12 board.
13     Each retirement system subject to this Code shall prepare a
14 report to be submitted to the Governor and the General Assembly
15 by September 1 of each year. The report shall identify the
16 emerging investment managers used by the system, the percentage
17 of the system's assets under the investment control of emerging
18 investment managers, and the actions it has undertaken to
19 increase the use of emerging investment managers, including
20 encouraging other investment managers to use emerging
21 investment managers as subcontractors when the opportunity
22 arises.
23     The use of an emerging investment manager does not
24 constitute a transfer of investment authority for the purposes
25 of subsection (2) of this Section.
26     (5) Each retirement system, pension fund, or investment

 

 

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1 board subject to this Code, except those whose investments are
2 restricted by Section 1-113.2 of this Code, shall establish a
3 policy that sets forth goals for increasing the racial, ethnic,
4 and gender diversity of its fiduciaries, including its
5 consultants and senior staff. Each system, fund, and investment
6 board shall annually review the goals established under this
7 subsection.
8     (6) On or before January 1, 2010, a retirement system,
9 pension fund, or investment board subject to this Code, except
10 those whose investments are restricted by Section 1-113.2 of
11 this Code, shall adopt a policy that sets forth goals for
12 utilization of businesses owned by minorities, females, and
13 persons with disabilities for all contracts and services. The
14 goals established shall be based on the percentage of total
15 dollar amount of all contracts let to minority owned
16 businesses, female owned businesses, and businesses owned by a
17 person with a disability, as those terms are defined in the
18 Business Enterprise for Minorities, Females, and Persons with
19 Disabilities Act. The retirement system, pension fund, or
20 investment board shall annually review the goals established
21 under this subsection.
22     (7) On or before January 1, 2010, a retirement system,
23 pension fund, or investment board subject to this Code, except
24 those whose investments are restricted by Section 1-113.2 of
25 this Code, shall adopt a policy that sets forth goals for
26 increasing the utilization of minority broker-dealers. For the

 

 

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1 purposes of this Code, "minority broker-dealer" means a
2 qualified broker-dealer who meets the definition of "minority
3 owned business", "female owned business", or "business owned by
4 a person with a disability", as those terms are defined in the
5 Business Enterprise for Minorities, Females, and Persons with
6 Disabilities Act. The retirement system, pension fund, or
7 investment board shall annually review the goals established
8 under this Section.
9     (8) Each retirement system, pension fund, and investment
10 board subject to this Code, except those whose investments are
11 restricted by Section 1-113.2 of this Code, shall submit a
12 report to the Governor and the General Assembly by January 1 of
13 each year that includes the following: (i) the policy adopted
14 under subsection (4) of this Section, including the names and
15 addresses of the emerging investment managers used, percentage
16 of the assets under the investment control of emerging
17 investment managers for the 3 separate goals, and the actions
18 it has undertaken to increase the use of emerging investment
19 managers, including encouraging other investment managers to
20 use emerging investment managers as subcontractors when the
21 opportunity arises; (ii) the policy adopted under subsection
22 (5) of this Section; (iii) the policy adopted under subsection
23 (6) of this Section; and (iv) the policy adopted under
24 subsection (7) of this Section, including specific actions
25 undertaken to increase the use of minority broker-dealers.
26 (Source: P.A. 94-471, eff. 8-4-05.)
 

 

 

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1     (40 ILCS 5/1-110)  (from Ch. 108 1/2, par. 1-110)
2     Sec. 1-110. Prohibited Transactions.
3     (a) A fiduciary with respect to a retirement system, or
4 pension fund, or investment board shall not cause the
5 retirement system or pension fund to engage in a transaction if
6 he or she knows or should know that such transaction
7 constitutes a direct or indirect:
8         (1) Sale or exchange, or leasing of any property from
9     the retirement system or pension fund to a party in
10     interest for less than adequate consideration, or from a
11     party in interest to a retirement system or pension fund
12     for more than adequate consideration.
13         (2) Lending of money or other extension of credit from
14     the retirement system or pension fund to a party in
15     interest without the receipt of adequate security and a
16     reasonable rate of interest, or from a party in interest to
17     a retirement system or pension fund with the provision of
18     excessive security or an unreasonably high rate of
19     interest.
20         (3) Furnishing of goods, services or facilities from
21     the retirement system or pension fund to a party in
22     interest for less than adequate consideration, or from a
23     party in interest to a retirement system or pension fund
24     for more than adequate consideration.
25         (4) Transfer to, or use by or for the benefit of, a

 

 

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1     party in interest of any assets of a retirement system or
2     pension fund for less than adequate consideration.
3     (b) A fiduciary with respect to a retirement system or
4 pension fund established under this Code shall not:
5         (1) Deal with the assets of the retirement system or
6     pension fund in his own interest or for his own account;
7         (2) In his individual or any other capacity act in any
8     transaction involving the retirement system or pension
9     fund on behalf of a party whose interests are adverse to
10     the interests of the retirement system or pension fund or
11     the interests of its participants or beneficiaries; or
12         (3) Receive any consideration for his own personal
13     account from any party dealing with the retirement system
14     or pension fund in connection with a transaction involving
15     the assets of the retirement system or pension fund.
16     (c) Nothing in this Section shall be construed to prohibit
17 any trustee from:
18         (1) Receiving any benefit to which he may be entitled
19     as a participant or beneficiary in the retirement system or
20     pension fund.
21         (2) Receiving any reimbursement of expenses properly
22     and actually incurred in the performance of his duties with
23     the retirement system or pension fund.
24         (3) Serving as a trustee in addition to being an
25     officer, employee, agent or other representative of a party
26     in interest.

 

 

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1     (d) A fiduciary of a pension fund established under Article
2 3 or 4 shall not knowingly cause or advise the pension fund to
3 engage in an investment transaction when the fiduciary (i) has
4 any direct interest in the income, gains, or profits of the
5 investment adviser advisor through which the investment
6 transaction is made or (ii) has a business relationship with
7 that investment adviser advisor that would result in a
8 pecuniary benefit to the fiduciary as a result of the
9 investment transaction.
10     Violation of this subsection (d) is a Class 4 felony.
11     (e) A board member, employee, or consultant with respect to
12 a retirement system, pension fund, or investment board subject
13 to this Code, except those whose investments are restricted by
14 Section 1-113.2, shall not knowingly cause or advise the
15 retirement system, pension fund, or investment board to engage
16 in an investment transaction with an investment adviser when
17 the board member, employee, consultant, or their spouse (i) has
18 any direct interest in the income, gains, or profits of the
19 investment adviser through which the investment transaction is
20 made or (ii) has a relationship with that investment adviser
21 that would result in a pecuniary benefit to the board member,
22 employee, or consultant or spouse of such board member,
23 employee, or consultant as a result of the investment
24 transaction. For purposes of this subsection (e), a consultant
25 includes an employee or agent of a consulting firm who has
26 greater than 7.5% ownership of the consulting firm.

 

 

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1     Violation of this subsection (e) is a Class 4 felony.
2 (Source: P.A. 95-950, eff. 8-29-08.)
 
3     (40 ILCS 5/1-113.5)
4     Sec. 1-113.5. Investment advisers and investment services
5 for all Article 3 or 4 pension funds.
6     (a) The board of trustees of a pension fund may appoint
7 investment advisers as defined in Section 1-101.4. The board of
8 any pension fund investing in common or preferred stock under
9 Section 1-113.4 shall appoint an investment adviser before
10 making such investments.
11     The investment adviser shall be a fiduciary, as defined in
12 Section 1-101.2, with respect to the pension fund and shall be
13 one of the following:
14         (1) an investment adviser registered under the federal
15     Investment Advisers Act of 1940 and the Illinois Securities
16     Law of 1953;
17         (2) a bank or trust company authorized to conduct a
18     trust business in Illinois;
19         (3) a life insurance company authorized to transact
20     business in Illinois; or
21         (4) an investment company as defined and registered
22     under the federal Investment Company Act of 1940 and
23     registered under the Illinois Securities Law of 1953.
24     (a-5) Notwithstanding any other provision of law, a person
25 or entity that provides consulting services (referred to as a

 

 

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1 "consultant" in this Section) to a pension fund with respect to
2 the selection of fiduciaries may not be awarded a contract to
3 provide those consulting services that is more than 5 years in
4 duration. No contract to provide such consulting services may
5 be renewed or extended. At the end of the term of a contract,
6 however, the contractor is eligible to compete for a new
7 contract. No person shall attempt to avoid or contravene the
8 restrictions of this subsection by any means. All offers from
9 responsive offerors shall be accompanied by disclosure of the
10 names and addresses of the following:
11         (1) The offeror.
12         (2) Any entity that is a parent of, or owns a
13     controlling interest in, the offeror.
14         (3) Any entity that is a subsidiary of, or in which a
15     controlling interest is owned by, the offeror.
16     Beginning on July 1, 2008, a person, other than a trustee
17 or an employee of a pension fund or retirement system, may not
18 act as a consultant under this Section unless that person is at
19 least one of the following: (i) registered as an investment
20 adviser under the federal Investment Advisers Act of 1940 (15
21 U.S.C. 80b-1, et seq.); (ii) registered as an investment
22 adviser under the Illinois Securities Law of 1953; (iii) a
23 bank, as defined in the Investment Advisers Act of 1940; or
24 (iv) an insurance company authorized to transact business in
25 this State.
26     (b) All investment advice and services provided by an

 

 

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1 investment adviser or a consultant appointed under this Section
2 shall be rendered pursuant to a written contract between the
3 investment adviser and the board, and in accordance with the
4 board's investment policy.
5     The contract shall include all of the following:
6         (1) acknowledgement in writing by the investment
7     adviser that he or she is a fiduciary with respect to the
8     pension fund;
9         (2) the board's investment policy;
10         (3) full disclosure of direct and indirect fees,
11     commissions, penalties, and any other compensation that
12     may be received by the investment adviser, including
13     reimbursement for expenses; and
14         (4) a requirement that the investment adviser submit
15     periodic written reports, on at least a quarterly basis,
16     for the board's review at its regularly scheduled meetings.
17     All returns on investment shall be reported as net returns
18     after payment of all fees, commissions, and any other
19     compensation.
20     (b-5) Each contract described in subsection (b) shall also
21 include (i) full disclosure of direct and indirect fees,
22 commissions, penalties, and other compensation, including
23 reimbursement for expenses, that may be paid by or on behalf of
24 the investment adviser or consultant in connection with the
25 provision of services to the pension fund and (ii) a
26 requirement that the investment adviser or consultant update

 

 

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1 the disclosure promptly after a modification of those payments
2 or an additional payment.
3     Within 30 days after the effective date of this amendatory
4 Act of the 95th General Assembly, each investment adviser and
5 consultant providing services on the effective date or subject
6 to an existing contract for the provision of services must
7 disclose to the board of trustees all direct and indirect fees,
8 commissions, penalties, and other compensation paid by or on
9 behalf of the investment adviser or consultant in connection
10 with the provision of those services and shall update that
11 disclosure promptly after a modification of those payments or
12 an additional payment.
13     A person required to make a disclosure under subsection (d)
14 is also required to disclose direct and indirect fees,
15 commissions, penalties, or other compensation that shall or may
16 be paid by or on behalf of the person in connection with the
17 rendering of those services. The person shall update the
18 disclosure promptly after a modification of those payments or
19 an additional payment.
20     The disclosures required by this subsection shall be in
21 writing and shall include the date and amount of each payment
22 and the name and address of each recipient of a payment.
23     (c) Within 30 days after appointing an investment adviser
24 or consultant, the board shall submit a copy of the contract to
25 the Division of Insurance of the Department of Financial and
26 Professional Regulation.

 

 

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1     (d) Investment services provided by a person other than an
2 investment adviser appointed under this Section, including but
3 not limited to services provided by the kinds of persons listed
4 in items (1) through (4) of subsection (a), shall be rendered
5 only after full written disclosure of direct and indirect fees,
6 commissions, penalties, and any other compensation that shall
7 or may be received by the person rendering those services.
8     (e) The board of trustees of each pension fund shall retain
9 records of investment transactions in accordance with the rules
10 of the Department of Financial and Professional Regulation.
11 (Source: P.A. 95-950, eff. 8-29-08.)
 
12     (40 ILCS 5/1-113.14 new)
13     Sec. 1-113.14. Investment services for retirement systems,
14 pension funds, and investment boards, except those funds
15 established under Articles 3 and 4.
16     (a) For the purposes of this Section, "investment services"
17 means services provided by an investment adviser or a
18 consultant.
19     (b) The selection and appointment of an investment adviser
20 or consultant for investment services by the board of a
21 retirement system, pension fund, or investment board subject to
22 this Code, except those whose investments are restricted by
23 Section 1-113.2, shall be made and awarded in accordance with
24 this Section. All contracts for investment services shall be
25 awarded by the board using a competitive process that is

 

 

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1 substantially similar to the process required for the
2 procurement of professional and artistic services under
3 Article 35 of the Illinois Procurement Code. Each board of
4 trustees shall adopt a policy in accordance with this
5 subsection (b) within 60 days after the effective date of this
6 amendatory Act of the 96th General Assembly. The policy shall
7 be posted on its web site and filed with the Illinois
8 Procurement Policy Board. Exceptions to this Section are
9 allowed for (i) sole source procurements, (ii) emergency
10 procurements, and (iii) at the discretion of the pension fund,
11 retirement system, or board of investment, contracts that are
12 nonrenewable and one year or less in duration, so long as the
13 contract has a value of less than $20,000. All exceptions
14 granted under this Section must be published on the system's,
15 fund's, or board's web site, shall name the person authorizing
16 the procurement, and shall include a brief explanation of the
17 reason for the exception.
18     A person, other than a trustee or an employee of a
19 retirement system, pension fund, or investment board, may not
20 act as a consultant or investment adviser under this Section
21 unless that person is registered as an investment adviser under
22 the federal Investment Advisers Act of 1940 (15 U.S.C. 80b-1,
23 et seq.) or a bank, as defined in the federal Investment
24 Advisers Act of 1940 (15 U.S.C. 80b-1, et seq.).
25     (c) Investment services provided by an investment adviser
26 or a consultant appointed under this Section shall be rendered

 

 

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1 pursuant to a written contract between the investment adviser
2 or consultant and the board.
3     The contract shall include all of the following:
4         (1) Acknowledgement in writing by the investment
5     adviser or consultant that he or she is a fiduciary with
6     respect to the pension fund or retirement system.
7         (2) The description of the board's investment policy
8     and notice that the policy is subject to change.
9         (3) (i) Full disclosure of direct and indirect fees,
10     commissions, penalties, and other compensation, including
11     reimbursement for expenses, that may be paid by or on
12     behalf of the consultant in connection with the provision
13     of services to the pension fund or retirement system and
14     (ii) a requirement that the consultant update the
15     disclosure promptly after a modification of those payments
16     or an additional payment.
17         (4) A requirement that the investment adviser or
18     consultant, in conjunction with the board's staff, submit
19     periodic written reports, on at least a quarterly basis,
20     for the board's review at its regularly scheduled meetings.
21     All returns on investment shall be reported as net returns
22     after payment of all fees, commissions, and any other
23     compensation.
24         (5) Disclosure of the names and addresses of (i) the
25     consultant or investment adviser; (ii) any entity that is a
26     parent of, or owns a controlling interest in, the

 

 

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1     consultant or investment adviser; (iii) any entity that is
2     a subsidiary of, or in which a controlling interest is
3     owned by, the consultant or investment adviser; (iv) any
4     persons who have an ownership or distributive income share
5     in the consultant or investment adviser that is in excess
6     of 7.5%; or (v) serves as an executive officer of the
7     consultant or investment adviser.
8         (6) A disclosure of the names and addresses of all
9     subcontractors, if applicable, and the expected amount of
10     money each will receive under the contract, including an
11     acknowledgment that the contractor must promptly make
12     notification, in writing, if at any time during the term of
13     the contract a contractor adds or changes any
14     subcontractors. For purposes of this subparagraph (6),
15     "subcontractor" does not include non-investment related
16     professionals or professionals offering services that are
17     not directly related to the investment of assets, such as
18     legal counsel, actuary, proxy-voting services, services
19     used to track compliance with legal standards, and
20     investment fund of funds where the board has no direct
21     contractual relationship with the investment advisers or
22     partnerships.
23         (7) A description of service to be performed.
24         (8) A description of the need for the service.
25         (9) A description of the plan for post-performance
26     review.

 

 

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1         (10) A description of the qualifications necessary.
2         (11) The duration of the contract.
3         (12) The method for charging and measuring cost.
4     (d) Notwithstanding any other provision of law, a
5 retirement system, pension fund, or investment board subject to
6 this Code, except those whose investments are restricted by
7 Section 1-113.2 of this Code, shall not enter into a contract
8 with a consultant that exceeds 5 years in duration. No contract
9 to provide consulting services may be renewed or extended. At
10 the end of the term of a contract, however, the consultant is
11 eligible to compete for a new contract as provided in this
12 Section. No retirement system, pension fund, or investment
13 board shall attempt to avoid or contravene the restrictions of
14 this subsection (d) by any means.
15     (e) Within 60 days after the effective date of this
16 amendatory Act of the 96th General Assembly, each investment
17 adviser or consultant currently providing services or subject
18 to an existing contract for the provision of services must
19 disclose to the board of trustees all direct and indirect fees,
20 commissions, penalties, and other compensation paid by or on
21 behalf of the investment adviser or consultant in connection
22 with the provision of those services and shall update that
23 disclosure promptly after a modification of those payments or
24 an additional payment. The person shall update the disclosure
25 promptly after a modification of those payments or an
26 additional payment. The disclosures required by this

 

 

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1 subsection (e) shall be in writing and shall include the date
2 and amount of each payment and the name and address of each
3 recipient of a payment.
4     (f) The retirement system, pension fund, or board of
5 investment shall develop uniform documents that shall be used
6 for the solicitation, review, and acceptance of all investment
7 services. The form shall include the terms contained in
8 subsection (c) of this Section. All such uniform documents
9 shall be posted on the retirement system's, pension fund's, or
10 investment board's web site.
11     (g) A description of every contract for investment services
12 shall be posted in a conspicuous manner on the web site of the
13 retirement system, pension fund, or investment board. The
14 description must include the name of the person or entity
15 awarded a contract, the total amount applicable to the
16 contract, the total fees paid or to be paid, and a disclosure
17 approved by the board describing the factors that contributed
18 to the selection of an investment adviser or consultant.
 
19     (40 ILCS 5/1-113.16 new)
20     Sec. 1-113.16. Investment transparency.
21     (a) The purpose of this Section is to provide for
22 transparency in the investment of retirement or pension funds
23 and require the reporting of full and complete information
24 regarding the investments by pension funds, retirement
25 systems, and investment boards.

 

 

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1     (b) A retirement system, pension fund, or investment board
2 subject to this Code and any committees established by such
3 system, fund, or board must comply with the Open Meetings Act.
4     (c) Any retirement system, pension fund, or investment
5 board subject to this Code that establishes a committee shall
6 ensure that the majority of the members on such committee are
7 board members. If any member of a committee is not a member of
8 the board for the system, fund, or board, then that committee
9 member shall be a fiduciary.
10     (d) A retirement system, pension fund, or investment board
11 subject to this Code, except those whose investments are
12 restricted by Section 1-113.2, shall maintain an official web
13 site and make available in a clear and conspicuous manner, and
14 update at least quarterly, all of the following information
15 concerning the investment of funds:
16         (1) The total amount of funds held by the pension fund,
17     retirement system, or investment board.
18         (2) The asset allocation for the investments made by
19     the pension fund, retirement system, or investment board.
20         (3) Current and historic return information.
21         (4) A detailed listing of the investment advisers for
22     all asset classes.
23         (5) Performance of investments compared against
24     established benchmarks.
25         (6) A detailed list of all consultants doing business
26     with the retirement system, pension fund, or investment

 

 

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1     board.
2         (7) A detailed list of all contractors, other than
3     investment advisers and consultants, doing business with
4     the retirement system, pension fund, or investment board.
5         (8) Any requests for investment services.
6         (9) The names and email addresses of all board members,
7     directors, and senior staff.
8         (10) The report required under Section 1-109.1 of this
9     Code, if applicable.
10         (11) The description of each contract required under
11     subsection (g) of Section 1-113.14 of this Code, if
12     applicable.
13     (e) A pension fund whose investments are restricted by
14 Section 1-113.2 of this Code shall make the information
15 required in subsection (d) of this Section available on its web
16 site or in a location that allows the information to be
17 available for inspection by the public.
18     (f) Nothing in this Section requires the pension fund,
19 retirement system, or investment board to make information
20 available on the Internet that is exempt from inspection and
21 copying under the Freedom of Information Act.
 
22     (40 ILCS 5/1-113.18 new)
23     Sec. 1-113.18. Ethics training. All board members of a
24 retirement system, pension fund, or investment board created
25 under this Code must attend ethics training of at least 8 hours

 

 

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1 per year. The training required under this Section shall
2 include training on ethics, fiduciary duty, and investment
3 issues and any other curriculum that the board of the
4 retirement system, pension fund, or investment board
5 establishes as being important for the administration of the
6 retirement system, pension fund, or investment board. The
7 Supreme Court of Illinois shall be responsible for ethics
8 training and curriculum for judges designated by the Court to
9 serve as members of a retirement system, pension fund, or
10 investment board. Each board shall annually certify its
11 members' compliance with this Section and submit an annual
12 certification to the Division of Insurance of the Department of
13 Financial and Professional Regulation. Judges shall annually
14 certify compliance with the ethics training requirement and
15 shall submit an annual certification to the Chief Justice of
16 the Supreme Court of Illinois.
 
17     (40 ILCS 5/1-125)
18     Sec. 1-125. Prohibition on gifts.
19     (a) For the purposes of this Section:
20     "Gift" means a gift as defined in Section 1-5 of the State
21 Officials and Employees Ethics Act.
22     "Prohibited source" means a person or entity who:
23         (i) is seeking official action (A) by the board or (B)
24     by a board member;
25         (ii) does business or seeks to do business (A) with the

 

 

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1     board or (B) with a board member;
2         (iii) has interests that may be substantially affected
3     by the performance or non-performance of the official
4     duties of the board member; or
5         (iv) is registered or required to be registered with
6     the Secretary of State under the Lobbyist Registration Act,
7     except that an entity not otherwise a prohibited source
8     does not become a prohibited source merely because a
9     registered lobbyist is one of its members or serves on its
10     board of directors.
11     (b) No trustee or employee of a retirement system, pension
12 fund, or investment board created under board created under
13 Article 3 or 4 of this Code shall intentionally solicit or
14 accept any gift from any prohibited source as prescribed in
15 Article 10 of the State Officials and Employees Ethics Act.
16 The , including the exceptions contained in Section 10-15 of
17 that Act, other than paragraphs (4) and (5) of that Section
18 shall apply to trustees and employees of a retirement system,
19 pension fund, or investment board created under this Code.
20 Solicitation or acceptance of educational materials, however,
21 is not prohibited. For the purposes of this Section, references
22 to "State employee" and "employee" in Article 10 of the State
23 Officials and Employees Ethics Act shall include a trustee or
24 employee of a retirement system, pension fund, or investment
25 board created under a board created under Article 3 or 4 of
26 this Code.

 

 

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1     (c) A municipality may adopt or maintain policies or
2 ordinances that are more restrictive than those set forth in
3 this Section and may continue to follow any existing policies
4 or ordinances that are more restrictive or are in addition to
5 those set forth in this Section.
6     (d) To the extent that the provisions of this Section
7 conflict with the provisions of the State Officials and
8 Employees Ethics Act, the provisions of this Section control.
9     (e) (d) Violation of this Section is a Class A misdemeanor.
10 (Source: P.A. 95-950, eff. 8-29-08.)
 
11     (40 ILCS 5/1-130 new)
12     Sec. 1-130. No monetary gain on investments. No member or
13 employee of the board of trustees of any retirement system,
14 pension fund, or investment board created under this Code nor
15 any spouse of such member or employee shall knowingly have any
16 direct interest in the income, gains, or profits of any
17 investments made on behalf of a retirement system, pension
18 fund, or investment board created under this Code for which
19 such person is a member or employee, nor receive any pay or
20 emolument for services in connection with any investment. No
21 member or employee of the board of trustees of any retirement
22 system, pension fund, or investment board created under this
23 Code shall become an endorser or surety, or in any manner an
24 obligor for money loaned or borrowed from any retirement system
25 or pension fund created under this Code or the Illinois State

 

 

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1 Board of Investment. For the purposes of this Section, an
2 annuity otherwise provided in accordance with this Code or any
3 income, gains, or profits related to any non-controlling
4 interest in any public securities, mutual fund, or other
5 passive investment is not considered monetary gain on
6 investments.
7     Violation of this Section is a Class 3 felony.
 
8     (40 ILCS 5/1-135 new)
9     Sec. 1-135. Fraud. Any person who knowingly makes any false
10 statement or falsifies or permits to be falsified any record of
11 a retirement system or pension fund created under this Code or
12 the Illinois State Board of Investment in an attempt to defraud
13 the retirement system or pension fund created under this Code
14 or the Illinois State Board of Investment is guilty of a Class
15 3 felony.
 
16     (40 ILCS 5/1-145 new)
17     Sec. 1-145. Contingent and placement fees prohibited. No
18 person or entity shall retain a person or entity to attempt to
19 influence the outcome of an investment decision of or the
20 procurement of investment advice or services of a retirement
21 system, pension fund, or investment board of this Code for
22 compensation, contingent in whole or in part upon the decision
23 or procurement. Any person who violates this Section is guilty
24 of a business offense and shall be fined not more than $10,000.

 

 

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1 In addition, any person convicted of a violation of this
2 Section is prohibited for a period of 3 years from conducting
3 such activities.
 
4     (40 ILCS 5/1-150 new)
5     Sec. 1-150. Approval of travel or educational mission. The
6 expenses for travel or educational missions of a board member
7 of a retirement system, pension fund, or investment board
8 created under this Code, except those whose investments are
9 restricted by Section 1-113.2 of this Code, must be approved by
10 a majority of the board prior to the travel or educational
11 mission.
 
12     (40 ILCS 5/14-134)  (from Ch. 108 1/2, par. 14-134)
13     Sec. 14-134. Board created. The retirement system created
14 by this Article shall be a trust, separate and distinct from
15 all other entities. The responsibility for the operation of the
16 system and for making effective this Article is vested in a
17 board of trustees.
18     The board shall consist of 7 trustees, as follows:
19     (a) the Director of the Governor's Office of Management and
20 Budget; (b) the Comptroller; (c) one trustee, not a State
21 employee, who shall be Chairman, to be appointed by the
22 Governor for a 5 year term; (d) two members of the system, one
23 of whom shall be an annuitant age 60 or over, having at least 8
24 years of creditable service, to be appointed by the Governor

 

 

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1 for terms of 5 years; (e) one member of the system having at
2 least 8 years of creditable service, to be elected from the
3 contributing membership of the system by the contributing
4 members as provided in Section 14-134.1; (f) one annuitant of
5 the system who has been an annuitant for at least one full
6 year, to be elected from and by the annuitants of the system,
7 as provided in Section 14-134.1. The Director of the Governor's
8 Office of Management and Budget and the Comptroller shall be
9 ex-officio members and shall serve as trustees during their
10 respective terms of office, except that each of them may
11 designate another officer or employee from the same agency to
12 serve in his or her place. However, no ex-officio member may
13 designate a different proxy within one year after designating a
14 proxy unless the person last so designated has become
15 ineligible to serve in that capacity. Except for the elected
16 trustees, any vacancy in the office of trustee shall be filled
17 in the same manner as the office was filled previously.
18     A trustee shall serve until a successor qualifies, except
19 that a trustee who is a member of the system shall be
20 disqualified as a trustee immediately upon terminating service
21 with the State.
22     Notwithstanding any provision of this Section to the
23 contrary, the term of office of each trustee of the Board
24 appointed by the Governor who is sitting on the Board on the
25 effective date of this amendatory Act of the 96th General
26 Assembly is terminated on that effective date.

 

 

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1     Beginning on the 90th day after the effective date of this
2 amendatory Act of the 96th General Assembly, the board shall
3 consist of 13 trustees as follows:
4         (1) the Comptroller, who shall be the Chairperson;
5         (2) six persons appointed by the Governor with the
6     advice and consent of the Senate who may not be members of
7     the system or hold an elective State office and who shall
8     serve for a term of 5 years, except that the terms of the
9     initial appointees under this amendatory Act of the 96th
10     General Assembly shall be as follows: 3 for a term of 3
11     years and 3 for a term of 5 years;
12         (3) four active participants of the system having at
13     least 8 years of creditable service, to be elected from the
14     contributing members of the system by the contribution
15     members as provided in Section 14-134.1; and
16         (4) two annuitants of the system who have been
17     annuitants for at least one full year, to be elected from
18     and by the annuitants of the system, as provided in Section
19     14-134.1.
20     For the purposes of this Section, the Governor may make a
21 nomination and the Senate may confirm the nominee in advance of
22 the commencement of the nominee's term of office. The Governor
23 shall make nominations for appointment to the Board under this
24 Section within 60 days after the effective date of this
25 amendatory Act of the 96th General Assembly. A trustee sitting
26 on the board on the effective date of this amendatory Act of

 

 

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1 the 96th General Assembly may not hold over in office for more
2 than 90 days after the effective date of this amendatory Act of
3 the 96th General Assembly. Nothing in this Section shall
4 prevent the Governor from making a temporary appointment or
5 nominating a trustee holding office on the day before the
6 effective date of this amendatory Act of the 96th General
7 Assembly.
8     Each trustee is entitled to one vote on the board, and 4
9 trustees shall constitute a quorum for the transaction of
10 business. The affirmative votes of a majority of the trustees
11 present, but at least 3 trustees, shall be necessary for action
12 by the board at any meeting. On the 90th day after the
13 effective date of this amendatory Act of the 96th General
14 Assembly, 7 trustees shall constitute a quorum for the
15 transaction of business and the affirmative vote of a majority
16 of the trustees present, but at least 7 trustees, shall be
17 necessary for action by the board at any meeting. The board's
18 action of July 22, 1986, by which it amended the bylaws of the
19 system to increase the number of affirmative votes required for
20 board action from 3 to 4 (in response to Public Act 84-1028,
21 which increased the number of trustees from 5 to 7), and the
22 board's rejection, between that date and the effective date of
23 this amendatory Act of 1993, of proposed actions not receiving
24 at least 4 affirmative votes, are hereby validated.
25     The trustees shall serve without compensation, but shall be
26 reimbursed from the funds of the system for all necessary

 

 

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1 expenses incurred through service on the board.
2     Each trustee shall take an oath of office that he or she
3 will diligently and honestly administer the affairs of the
4 system, and will not knowingly violate or willfully permit the
5 violation of any of the provisions of law applicable to the
6 system. The oath shall be subscribed to by the trustee making
7 it, certified by the officer before whom it is taken, and filed
8 with the Secretary of State. A trustee shall qualify for
9 membership on the board when the oath has been approved by the
10 board.
11 (Source: P.A. 94-793, eff. 5-19-06.)
 
12     (40 ILCS 5/14-134.1)  (from Ch. 108 1/2, par. 14-134.1)
13     Sec. 14-134.1. Board-elected members-vacancies. The 2
14 elected trustees shall be elected, beginning in 1986 and every
15 5 years thereafter, for a term of 5 years beginning July 15
16 next following their election. The trustees to be elected under
17 Section 14-134 of this Code in accordance with this amendatory
18 Act of the 96th General Assembly shall be elected within 90
19 days after the effective date of this amendatory Act of the
20 96th General Assembly for a term of 5 years after the effective
21 date of this amendatory Act. Trustees shall be elected every 5
22 years thereafter for a term of 5 years beginning July 15 next
23 following their election. Elections shall be held on May 1, or
24 on May 2 when May 1 falls on Sunday. Candidates for the
25 contributing trustee shall be nominated by petitions in

 

 

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1 writing, signed by not less than 400 contributors with their
2 addresses shown opposite their names. Candidates for the
3 annuitant trustee shall be nominated by petitions in writing,
4 signed by not less than 100 annuitants with their addresses
5 shown opposite their names.
6     If there is more than one qualified nominee for either
7 elected trustee, the board shall conduct a secret ballot
8 election by mail for that trustee, in accordance with rules as
9 established by the board.
10     If there is only one qualified person nominated by petition
11 for either trustee, the election as required by this Section
12 shall not be conducted for that trustee and the board shall
13 declare such nominee duly elected.
14     A vacancy occurring in the elective membership of the board
15 shall be filled for the unexpired term by the board.
16 (Source: P.A. 84-1028.)
 
17     (40 ILCS 5/15-159)  (from Ch. 108 1/2, par. 15-159)
18     Sec. 15-159. Board created. A board of trustees constituted
19 as provided in this Section shall administer this System. The
20 board shall be known as the Board of Trustees of the State
21 Universities Retirement System.
22     (b) Until July 1, 1995, the Board of Trustees shall be
23 constituted as follows:
24     Two trustees shall be members of the Board of Trustees of
25 the University of Illinois, one shall be a member of the Board

 

 

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1 of Trustees of Southern Illinois University, one shall be a
2 member of the Board of Trustees of Chicago State University,
3 one shall be a member of the Board of Trustees of Eastern
4 Illinois University, one shall be a member of the Board of
5 Trustees of Governors State University, one shall be a member
6 of the Board of Trustees of Illinois State University, one
7 shall be a member of the Board of Trustees of Northeastern
8 Illinois University, one shall be a member of the Board of
9 Trustees of Northern Illinois University, one shall be a member
10 of the Board of Trustees of Western Illinois University, and
11 one shall be a member of the Illinois Community College Board,
12 selected in each case by their respective boards, and 2 shall
13 be participants of the system appointed by the Governor for a 6
14 year term with the first appointment made pursuant to this
15 amendatory Act of 1984 to be effective September 1, 1985, and
16 one shall be a participant appointed by the Illinois Community
17 College Board for a 6 year term, and one shall be a participant
18 appointed by the Board of Trustees of the University of
19 Illinois for a 6 year term, and one shall be a participant or
20 annuitant of the system who is a senior citizen age 60 or older
21 appointed by the Governor for a 6 year term with the first
22 appointment to be effective September 1, 1985.
23     The terms of all trustees holding office under this
24 subsection (b) on June 30, 1995 shall terminate at the end of
25 that day and the Board shall thereafter be constituted as
26 provided in subsection (c).

 

 

09600SB0364ham002 - 59 - LRB096 06397 AMC 25061 a

1     (c) Beginning July 1, 1995, the Board of Trustees shall be
2 constituted as follows:
3     The Board shall consist of 9 trustees appointed by the
4 Governor. Two of the trustees, designated at the time of
5 appointment, shall be participants of the System. Two of the
6 trustees, designated at the time of appointment, shall be
7 annuitants of the System who are receiving retirement annuities
8 under this Article. The 5 remaining trustees may, but need not,
9 be participants or annuitants of the System.
10     The term of office of trustees appointed under this
11 subsection (c) shall be 6 years, beginning on July 1. However,
12 of the initial trustees appointed under this subsection (c), 3
13 shall be appointed for terms of 2 years, 3 shall be appointed
14 for terms of 4 years, and 3 shall be appointed for terms of 6
15 years, to be designated by the Governor at the time of
16 appointment.
17     The terms of all trustees holding office under this
18 subsection (c) on the effective date of this amendatory Act of
19 the 96th General Assembly shall terminate on that effective
20 date. The Governor shall make nominations for appointment under
21 this Section within 60 days after the effective date of this
22 amendatory Act of the 96th General Assembly. A trustee sitting
23 on the board on the effective date of this amendatory Act of
24 the 96th General Assembly may not hold over in office for more
25 than 90 days after the effective date of this amendatory Act of
26 the 96th General Assembly. Nothing in this Section shall

 

 

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1 prevent the Governor from making a temporary appointment or
2 nominating a trustee holding office on the day before the
3 effective date of this amendatory Act of the 96th General
4 Assembly.
5     (d) Beginning on the 90th day after the effective date of
6 this amendatory Act of the 96th General Assembly, the Board of
7 Trustees shall be constituted as follows:
8         (1) The Chairperson of the Board of Higher Education,
9     who shall act as chairperson of this Board.
10         (2) Four trustees appointed by the Governor with the
11     advice and consent of the Senate who may not be members of
12     the system or hold an elective State office and who shall
13     serve for a term of 6 years, except that the terms of the
14     initial appointees under this subsection (d) shall be as
15     follows: 2 for a term of 3 years and 2 for a term of 6
16     years.
17         (3) Four active participants of the system to be
18     elected from the contributing membership of the system by
19     the contributing members, no more than 2 of which may be
20     from any of the University of Illinois campuses, who shall
21     serve for a term of 6 years, except that the terms of the
22     initial electees shall be as follows: 2 for a term of 3
23     years and 2 for a term of 6 years.
24         (4) Two annuitants of the system who have been
25     annuitants for at least one full year, to be elected from
26     and by the annuitants of the system, no more than one of

 

 

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1     which may be from any of the University of Illinois
2     campuses, who shall serve for a term of 6 years, except
3     that the terms of the initial electees shall be as follows:
4     one for a term of 3 years and one for a term of 6 years.
5     For the purposes of this Section, the Governor may make a
6 nomination and the Senate may confirm the nominee in advance of
7 the commencement of the nominee's term of office.
8     (e) The 6 elected trustees shall be elected within 90 days
9 after the effective date of this amendatory Act of the 96th
10 General Assembly for a term beginning on the 90th day after the
11 effective date of this amendatory Act. Trustees shall be
12 elected thereafter as terms expire for a 6-year term beginning
13 July 15 next following their election, and such election shall
14 be held on May 1, or on May 2 when May 1 falls on a Sunday. The
15 board may establish rules for the election of trustees to
16 implement the provisions of this amendatory Act of the 96th
17 General Assembly and for future elections. Candidates for the
18 participating trustee shall be nominated by petitions in
19 writing, signed by not less than 400 participants with their
20 addresses shown opposite their names. Candidates for the
21 annuitant trustee shall be nominated by petitions in writing,
22 signed by not less than 100 annuitants with their addresses
23 shown opposite their names. If there is more than one qualified
24 nominee for each elected trustee, then the board shall conduct
25 a secret ballot election by mail for that trustee, in
26 accordance with rules as established by the board. If there is

 

 

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1 only one qualified person nominated by petition for each
2 elected trustee, then the election as required by this Section
3 shall not be conducted for that trustee and the board shall
4 declare such nominee duly elected. A vacancy occurring in the
5 elective membership of the board shall be filled for the
6 unexpired term by the elected trustees serving on the board for
7 the remainder of the term.
8     (f) A vacancy on the board of trustees caused by
9 resignation, death, expiration of term of office, or other
10 reason shall be filled by a qualified person appointed by the
11 Governor for the remainder of the unexpired term.
12     (g) Trustees (other than the trustees incumbent on June 30,
13 1995 or as provided in subsection (c) of this Section) shall
14 continue in office until their respective successors are
15 appointed and have qualified, except that a trustee appointed
16 to one of the participant positions shall be disqualified
17 immediately upon the termination of his or her status as a
18 participant and a trustee appointed to one of the annuitant
19 positions shall be disqualified immediately upon the
20 termination of his or her status as an annuitant receiving a
21 retirement annuity.
22     (h) (d) Each trustee must take an oath of office before a
23 notary public of this State and shall qualify as a trustee upon
24 the presentation to the board of a certified copy of the oath.
25 The oath must state that the person will diligently and
26 honestly administer the affairs of the retirement system, and

 

 

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1 will not knowingly violate or wilfully permit to be violated
2 any provisions of this Article.
3     Each trustee shall serve without compensation but shall be
4 reimbursed for expenses necessarily incurred in attending
5 board meetings and carrying out his or her duties as a trustee
6 or officer of the system.
7     (i) (e) This amendatory Act of 1995 is intended to
8 supersede the changes made to this Section by Public Act 89-4.
9 (Source: P.A. 89-4, eff. 1-1-96; 89-196, eff. 7-21-95.)
 
10     (40 ILCS 5/16-163)  (from Ch. 108 1/2, par. 16-163)
11     Sec. 16-163. Board created. A board of 13 11 members
12 constitutes the board of trustees authorized to carry out the
13 provisions of this Article and is responsible for the general
14 administration of the System. The board shall be known as the
15 Board of Trustees of the Teachers' Retirement System of the
16 State of Illinois. The board shall be composed of the
17 Superintendent of Education, ex officio, who shall be the
18 president of the board; 6 4 persons, not members of the System,
19 to be appointed by the Governor, who shall hold no elected
20 State office; 4 persons who, at the time of their election, are
21 teachers as defined in Section 16-106, elected by the
22 contributing members; and 2 annuitant members elected by the
23 annuitants of the System, as provided in Section 16-165.
24 (Source: P.A. 94-423, eff. 8-2-05.)
 

 

 

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1     (40 ILCS 5/16-164)  (from Ch. 108 1/2, par. 16-164)
2     Sec. 16-164. Board - appointed members - vacancies. Terms
3 of office for the appointed members shall begin on July 15 of
4 an even-numbered year, except that the terms of office for
5 members appointed pursuant to this amendatory Act of the 96th
6 General Assembly shall begin upon being confirmed by the
7 Senate. The Governor shall appoint 3 2 members as trustees with
8 the advice and consent of the Senate in each even-numbered year
9 who shall hold office for a term of 4 years, except that, of
10 the members appointed pursuant to this amendatory Act of the
11 96th General Assembly, 3 members shall be appointed for a term
12 ending July 14, 2012 and 3 members shall be appointed for a
13 term ending July 14, 2014. Each such appointee shall reside in
14 and be a taxpayer in the territory covered by this system,
15 shall be interested in public school welfare, and experienced
16 and competent in financial and business management. A vacancy
17 in the term of an appointed trustee shall be filled for the
18 unexpired term by appointment of the Governor.
19     Notwithstanding any provision of this Section to the
20 contrary, the term of office of each member of the Board
21 appointed by the Governor who is sitting on the Board on the
22 effective date of this amendatory Act of the 96th General
23 Assembly is terminated on that effective date. A trustee
24 sitting on the board on the effective date of this amendatory
25 Act of the 96th General Assembly may not hold over in office
26 for more than 60 days after the effective date of this

 

 

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1 amendatory Act of the 96th General Assembly. Nothing in this
2 Section shall prevent the Governor from making a temporary
3 appointment or nominating a trustee holding office on the day
4 before the effective date of this amendatory Act of the 96th
5 General Assembly.
6 (Source: P.A. 83-1440.)
 
7     (40 ILCS 5/16-169)  (from Ch. 108 1/2, par. 16-169)
8     Sec. 16-169. Board - secretary and other employees. The
9 board, by a majority vote of all its members, shall appoint a
10 secretary who shall not be a member of the board and who shall
11 serve as the chief executive officer responsible for the
12 detailed administration of the system.
13     The secretary and chief executive officer of the system,
14 known as the Executive Director, holding that position on April
15 1, 2009 is terminated on July 1, 2009, by operation of law, and
16 shall thereafter no longer hold those positions or any other
17 employment position with the system. The board is directed to
18 take whatever action is necessary to effectuate this
19 termination.
20 (Source: P.A. 83-1440.)
 
21     (40 ILCS 5/22A-109)  (from Ch. 108 1/2, par. 22A-109)
22     Sec. 22A-109. Membership of board. The board shall consist
23 of the following members:
24         (1) Five trustees appointed by the Governor with the

 

 

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1     advice and consent of the Senate who may not hold an
2     elective State office.
3         (2) The Treasurer.
4         (3) The Comptroller, who shall represent the State
5     Employees' Retirement System of Illinois.
6         (4) The Chairperson of the General Assembly Retirement
7     System.
8         (5) The Chairperson of the Judges Retirement System of
9     Illinois.
10 (a) ex-officio members consisting of the State Treasurer and
11 the Chairman of the board of trustees of each pension fund or
12 retirement system, other than pension funds covered by Articles
13 3 and 4 of this Code, whose investment functions have been
14 transferred to the jurisdiction of this board; and (b) 5
15 members appointed by the Governor with the approval of the
16 Senate, one of whom shall be a senior citizen age 60 or over.
17 The appointive members shall serve for terms of 4 years except
18 that the terms of office of the original appointive members
19 pursuant to this amendatory Act of the 96th General Assembly
20 shall be as follows: One member for a term of 1 year; 1 member
21 for a term of 2 years; 1 member for a term of 3 years; and 2
22 members 1 member for a term of 4 years. The member first
23 appointed under this amendatory Act of 1984 shall serve for a
24 term of 4 years. Vacancies among the appointive members shall
25 be filled for unexpired terms by appointment in like manner as
26 for original appointments, and appointive members shall

 

 

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1 continue in office until their successors have been appointed
2 and have qualified. Ex-officio members who cannot attend
3 meetings of the board or its committees may respectively
4 designate one appropriate proxy from within the office of the
5 State Treasurer or the trustees of the pension fund or
6 retirement system, which proxy shall have the same powers and
7 authority as the ex-officio member being represented, but no
8 member may designate a different proxy within one year after
9 his last designation of a proxy unless the person last so
10 designated has become ineligible to serve in that capacity.
11     Notwithstanding any provision of this Section to the
12 contrary, the term of office of each trustee of the Board
13 appointed by the Governor who is sitting on the Board on the
14 effective date of this amendatory Act of the 96th General
15 Assembly is terminated on that effective date. A trustee
16 sitting on the board on the effective date of this amendatory
17 Act of the 96th General Assembly may not hold over in office
18 for more than 60 days after the effective date of this
19 amendatory Act of the 96th General Assembly. Nothing in this
20 Section shall prevent the Governor from making a temporary
21 appointment or nominating a trustee holding office on the day
22 before the effective date of this amendatory Act of the 96th
23 General Assembly.
24     Each person appointed to membership shall qualify by taking
25 an oath of office before the Secretary of State stating that he
26 will diligently and honestly administer the affairs of the

 

 

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1 board and will not violate or knowingly permit the violation of
2 any provisions of this Article.
3     Members of the board shall receive no salary for service on
4 the board but shall be reimbursed for travel expenses incurred
5 while on business for the board according to the standards in
6 effect for members of the Illinois Legislative Research Unit.
7     A majority of the members of the board shall constitute a
8 quorum. The board shall elect from its membership, biennially,
9 a Chairman, Vice Chairman and a Recording Secretary. These
10 officers, together with one other member elected by the board,
11 shall constitute the executive committee. During the interim
12 between regular meetings of the board, the executive committee
13 shall have authority to conduct all business of the board and
14 shall report such business conducted at the next following
15 meeting of the board for ratification.
16     No member of the board shall have any interest in any
17 brokerage fee, commission or other profit or gain arising out
18 of any investment made by the board. This paragraph does not
19 preclude ownership by any member of any minority interest in
20 any common stock or any corporate obligation in which
21 investment is made by the board.
22     The board shall contract for a blanket fidelity bond in the
23 penal sum of not less than $1,000,000.00 to cover members of
24 the board, the director and all other employees of the board
25 conditioned for the faithful performance of the duties of their
26 respective offices, the premium on which shall be paid by the

 

 

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1 board. The bond shall be filed with the State Treasurer for
2 safekeeping.
3 (Source: P.A. 87-1265.)
 
4     Section 97. Severability. The provisions of this Act are
5 severable under Section 1.31 of the Statute on Statutes.
 
6     Section 99. Effective date. This Act takes effect upon
7 becoming law.".