Full Text of HB4622 102nd General Assembly
HB4622eng 102ND GENERAL ASSEMBLY |
| | HB4622 Engrossed | | LRB102 22290 RPS 31423 b |
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| 1 | | AN ACT concerning public employee benefits.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Pension Code is amended by | 5 | | changing Section 22B-120 as follows: | 6 | | (40 ILCS 5/22B-120) | 7 | | Sec. 22B-120. Transition period; transfer of securities, | 8 | | assets, and investment functions. | 9 | | (a) The transition period shall commence on January 1, | 10 | | 2020 ( the effective date of Public Act 101-610) this | 11 | | amendatory Act of the 101st General Assembly and shall end as | 12 | | determined by the board, consistent with and in the | 13 | | application of its fiduciary responsibilities, but in no event | 14 | | later than June 30, 2023 30 months thereafter . | 15 | | (b) The board may retain the services of custodians, | 16 | | investment consultants, and other professional services it | 17 | | deems prudent to implement the transition of assets described | 18 | | in this Section. The permanent board of trustees shall not be | 19 | | bound by any contract or agreement regarding such custodians, | 20 | | investment consultants, or other professional services entered | 21 | | into by the transition board of trustees. | 22 | | (c) As soon as practicable after January 1, 2020 ( the | 23 | | effective date of Public Act 101-610) this amendatory Act of |
| | | HB4622 Engrossed | - 2 - | LRB102 22290 RPS 31423 b |
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| 1 | | the 101st General Assembly , the board, in cooperation with the | 2 | | Department of Insurance, shall audit the investment assets of | 3 | | each transferor pension fund to determine a certified | 4 | | investment asset list for each transferor pension fund. The | 5 | | audit shall be performed by a certified public accountant | 6 | | engaged by the board, and the board shall be responsible for | 7 | | payment of the costs and expenses associated with the audit. | 8 | | Upon completion of the audit for any transferor pension fund, | 9 | | the board and the Department of Insurance shall provide the | 10 | | certified investment asset list to that transferor pension | 11 | | fund. Upon determination of the certified investment asset | 12 | | list for any transferor pension fund, the board shall, within | 13 | | 10 business days or as soon thereafter as may be practicable as | 14 | | determined by the board, initiate the transfer of assets from | 15 | | that transferor pension fund. Further and to maintain accuracy | 16 | | of the certified investment asset list, upon determination of | 17 | | the certified investment asset list for a transferor pension | 18 | | fund, that fund shall not purchase or sell any of its pension | 19 | | fund assets. | 20 | | (d) When the Fund is prepared to receive pension fund | 21 | | assets from any transferor pension fund, the executive | 22 | | director shall notify in writing the board of trustees of that | 23 | | transferor pension fund of the Fund's intent to assume | 24 | | fiduciary control of those pension fund assets, and the date | 25 | | at which it will assume such control and that the transferor | 26 | | pension fund will cease to exercise fiduciary responsibility. |
| | | HB4622 Engrossed | - 3 - | LRB102 22290 RPS 31423 b |
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| 1 | | This letter shall be transmitted no less than 30 days prior to | 2 | | the transfer date. A copy of the letter shall be transmitted to | 3 | | the Department of Insurance. Upon receipt of the letter, the | 4 | | transferor pension fund shall promptly notify its custodian, | 5 | | as well as any and all entities with fiduciary control of any | 6 | | portion of the pension assets. Each transferor pension fund | 7 | | shall have sole fiduciary and statutory responsibility for the | 8 | | management of its pension assets until the start of business | 9 | | on the transfer date. At the start of business on the transfer | 10 | | date, statutory and fiduciary responsibility for the | 11 | | investment of pension fund assets shall shift exclusively to | 12 | | the Fund and the Fund shall promptly and prudently transfer | 13 | | all such pension fund assets to the board and terminate the | 14 | | relationship with the local custodian of that transferor | 15 | | pension fund. The Fund shall provide a receipt for the | 16 | | transfer to the transferor pension fund within 30 days of the | 17 | | transfer date. | 18 | | As used in this subsection, "transfer date" means the date | 19 | | at which the Fund will assume fiduciary control of the | 20 | | transferor pension fund's assets and the transferor pension | 21 | | fund will cease to exercise fiduciary responsibility. | 22 | | (e) Within 90 days after the end of the transition period | 23 | | or as soon thereafter as may be practicable as determined by | 24 | | the board, the Fund and the Department of Insurance shall | 25 | | cooperate in transferring to the Fund all pension fund assets | 26 | | remaining in the custody of the transferor pension funds. |
| | | HB4622 Engrossed | - 4 - | LRB102 22290 RPS 31423 b |
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| 1 | | (f) The board shall adopt such rules as in its judgment are | 2 | | desirable to implement the transition process, including, | 3 | | without limitation, the transfer of the pension fund assets of | 4 | | the transferor pension funds, the assumption of fiduciary | 5 | | control of such assets by the Fund, and the termination of | 6 | | relationships with local custodians. The adoption and | 7 | | effectiveness of such rules and regulations shall not be | 8 | | subject to Article 5 of the Illinois Administrative Procedure | 9 | | Act. | 10 | | (g) Within 6 months after the end of the transition period | 11 | | or as soon thereafter as may be practicable as determined by | 12 | | the board, the books, records, accounts, and securities of the | 13 | | Fund shall be audited by a certified public accountant | 14 | | selected by the board. This audit shall include, but not be | 15 | | limited to, the following: (1) a full description of the | 16 | | investments acquired, showing average costs; (2) a full | 17 | | description of the securities sold or exchanged, showing | 18 | | average proceeds or other conditions of an exchange; (3) gains | 19 | | or losses realized during the period; (4) income from | 20 | | investments; and (5) administrative expenses incurred by the | 21 | | board. This audit report shall be published on the Fund's | 22 | | official website and filed with the Department of Insurance. | 23 | | (h) To provide funds for payment of the ordinary and | 24 | | regular costs associated with the implementation of this | 25 | | transition process, the Illinois Finance Authority is | 26 | | authorized to loan to the Fund up to $7,500,000 of any of the |
| | | HB4622 Engrossed | - 5 - | LRB102 22290 RPS 31423 b |
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| 1 | | Authority's funds, including, but not limited to, funds in its | 2 | | Illinois Housing Partnership Program Fund, its Industrial | 3 | | Project Insurance Fund, or its Illinois Venture Investment | 4 | | Fund, for such purpose. Such loan shall be repaid by the Fund | 5 | | with an interest rate tied to the Federal Funds Rate or an | 6 | | equivalent market established variable rate. The Fund and the | 7 | | Illinois Finance Authority shall enter into a loan or similar | 8 | | agreement that specifies the period of the loan, the payment | 9 | | interval, procedures for making periodic loans, the variable | 10 | | rate methodology to which the interest rate for loans should | 11 | | be tied, the funds of the Illinois Finance Authority that will | 12 | | be used to provide the loan, and such other terms that the Fund | 13 | | and the Illinois Finance Authority reasonably believe to be | 14 | | mutually beneficial. Such agreement shall be a public record | 15 | | and the Fund shall post the terms of the agreement on its | 16 | | official website.
| 17 | | (Source: P.A. 101-610, eff. 1-1-20.)
| 18 | | Section 99. Effective date. This Act takes effect upon | 19 | | becoming law.
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