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90_HB0849
40 ILCS 5/1-110 from Ch. 108 1/2, par. 1-110
Amends the General Provisions Article of the Pension
Code. Prohibits investment in securities of companies that
manufacture automatic or semi-automatic firearms for
nonmilitary use; does not require liquidation of current
investments. Effective immediately.
LRB9002484EGfg
LRB9002484EGfg
1 AN ACT to amend the Illinois Pension Code by changing
2 Section 1-110.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Pension Code is amended by
6 changing Section 1-110 as follows:
7 (40 ILCS 5/1-110) (from Ch. 108 1/2, par. 1-110)
8 Sec. 1-110. Prohibited transactions.
9 (a) A fiduciary with respect to a retirement system or
10 pension fund shall not cause the retirement system or pension
11 fund to engage in a transaction if he or she knows or should
12 know that such transaction constitutes a direct or indirect:
13 (1) Sale or exchange, or leasing of any property
14 from the retirement system or pension fund to a party in
15 interest for less than adequate consideration, or from a
16 party in interest to a retirement system or pension fund
17 for more than adequate consideration.
18 (2) Lending of money or other extension of credit
19 from the retirement system or pension fund to a party in
20 interest without the receipt of adequate security and a
21 reasonable rate of interest, or from a party in interest
22 to a retirement system or pension fund with the provision
23 of excessive security or an unreasonably high rate of
24 interest.
25 (3) Furnishing of goods, services or facilities
26 from the retirement system or pension fund to a party in
27 interest for less than adequate consideration, or from a
28 party in interest to a retirement system or pension fund
29 for more than adequate consideration.
30 (4) Transfer to, or use by or for the benefit of, a
31 party in interest of any assets of a retirement system or
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1 pension fund for less than adequate consideration.
2 (b) A fiduciary with respect to a retirement system or
3 pension fund established under this Code shall not:
4 (1) deal with the assets of the retirement system
5 or pension fund in his own interest or for his own
6 account;
7 (2) in his individual or any other capacity act in
8 any transaction involving the retirement system or
9 pension fund on behalf of a party whose interests are
10 adverse to the interests of the retirement system or
11 pension fund or the interests of its participants or
12 beneficiaries; or
13 (3) receive any consideration for his own personal
14 account from any party dealing with the retirement system
15 or pension fund in connection with a transaction
16 involving the assets of the retirement system or pension
17 fund; or
18 (4) invest any assets of the retirement system or
19 pension fund in restricted firearms company securities
20 after December 31, 1997. This item (4) does not require
21 the liquidation of any investment in existence on that
22 date, but the fiduciary is encouraged to review the
23 advisability of continuing any existing investment in
24 restricted firearms company securities in light of the
25 public policy of this item (4) discouraging such
26 investments and to consider the advantages of liquidating
27 the investment at an appropriate time. For the purposes
28 of this item (4), "restricted firearms company
29 securities" means securities issued by a company or other
30 business entity that manufactures automatic or
31 semi-automatic firearms for nonmilitary use. The Public
32 Employee Pension Fund Division of the Department of
33 Insurance may adopt by rule a list of firearms companies
34 whose securities are subject to investment restrictions
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1 under this item (4); if such a list is adopted, a
2 fiduciary may rely upon that list in determining whether
3 an investment is prohibited under this item (4).
4 (c) Nothing in this Section shall be construed to
5 prohibit any trustee from:
6 (1) Receiving any benefit to which he may be
7 entitled as a participant or beneficiary in the
8 retirement system or pension fund.
9 (2) Receiving any reimbursement of expenses
10 properly and actually incurred in the performance of his
11 duties with the retirement system or pension fund.
12 (3) Serving as a trustee in addition to being an
13 officer, employee, agent or other representative of a
14 party in interest.
15 (Source: P.A. 88-535.)
16 Section 99. Effective date. This Act takes effect upon
17 becoming law.