Legislation 101st General Assembly (2019-2020)

House

HB 0357
- FY 2021 Budget Implementation Act
Sponsor(s): Representative Gregory Harris and Senator Don Harmon

HB 357 creates the FY 2021 Budget Implementation Act to make changes in state programs that are necessary to implement the FY 2021 budget.

As it relates to SURS, HB 357 authorizes the use of money in the State Pensions Fund as part of the annual state contribution to SURS for FY 2021 and extends the lapse period for FY 2020 from August 31, 2020, to December 31, 2020.

HB 357 takes effect immediately upon becoming law.
Governor Pritzker signed HB 357 into law on June 10, 2020, as Public Act 101-0636.

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HB 2029
- Vested Inactive Buyout – Health Insurance Preservation
Sponsor(s): Representative Mark L. Walker

HB 2029 amends the State Employees Group Insurance Act of 1971 to ensure that members who take the Vested Inactive Buyout on or after June 4, 2018, under the State Employees’ Retirement System (SERS), State Universities Retirement System (SURS), and Teachers’ Retirement System (TRS) preserve any applicable retiree and survivor health insurance benefits upon receipt of the buyout payment.

Public Act 100-0587 created two buyout options for eligible members of the three state-funded retirement systems (SERS, SURS and TRS): (1) a buyout of pension benefits for vested, inactive members; and (2) a partial buyout of automatic annual increases for Tier I members at retirement.   The Vested, Inactive Buyout (or VIB) is a lump-sum payment equal to 60 percent of the present value of the member’s pension benefits, in exchange for the member forfeiting all accrued rights and credits under the System.  The Tier I AAI Buyout (or AAI Buyout) is a lump-sum payment equal to 70 percent of the difference between the present value of Tier I automatic annual increases and the present value of reduced and delayed automatic annual increases, in exchange for the member receiving reduced and delayed automatic annual increases on retirement and survivor annuities.

Public Act 100-0587 amended the definition of an “annuitant” under the State Employees Group Insurance Program to ensure that members who take the Vested Inactive Buyout will receive health insurance benefits upon meeting the age and service credit requirements for retirement, if they are eligible to participate in the State Employees Group Insurance Program.   However, Public Act 100-0587 failed to amend the definitions of “survivor” under the State Employees Group Insurance Program, “community college benefit recipient” under the College Insurance Program, and “TRS benefit recipient” under the Teachers Retiree Health Insurance Program to clarify that survivors of members in the State Employees Group Insurance Program, as well as members and survivors who are eligible to participate in the College Insurance Program and the Teachers Retiree Health Insurance Program, will receive health insurance benefits after the member meets the age and service credit requirements for retirement.  

HB 2029 amends the definitions of “survivor” under the State Employees Group Insurance Program, “community college benefit recipient” under the College Insurance Program, and “TRS benefit recipient” under the Teachers Retiree Health Insurance Program to ensure that all members who elect the Vested Inactive Buyout, as well as their eligible survivors, will receive any applicable health insurance benefits upon the member meeting the age and service credit requirements for retirement.

HB 2029 takes effect immediately upon becoming law.

Governor Pritzker signed HB 2029 into law on August 9, 2019, as Public Act 101-0242.

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HB 2460
- Investment Policies – Sustainability Factors
Sponsor(s): Representative William Davis and Senator Iris Y. Martinez

As it passed the House, HB 2460 amends the General Provisions article of the Illinois Pension Code to require investment policies to include sustainability factors to be considered in evaluating investment decisions.

Specifically, HB 2460 requires every retirement system, pension fund, or investment board subject to the Illinois Pension Code to adopt a written investment policy and file a copy of that policy with the Department of Insurance within 30 days after its adoption.   The investment policy must include material, relevant, and decision-useful sustainability factors to be considered by the board within the bounds of financial and fiduciary predence, in evaluating investment decisions. Sustainability factors include, but are not limited to: (1) corporate governance and leadership factors; (2) environmental factors; (3) social capital factors; (4) human capital factors; and (5) business model and innovation factors, as provided under the Illinois Sustainable Investing Act.  Whenever a board changes its investment policy, it must file a copy of the new policy with the Department of Insurance within 30 days.

HB 2460 also makes other changes.

HB 2460 takes effect in accordance with the Effective Date of Laws Act.

As introduced, HB 2460 is identical to SB 2062 of the 101st General Assembly.

Governor Pritzker signed HB 2460 into law on August 23, 2019, as Public Act 101-0473.

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HJR 0016
- State Sponsored Health Clinic Task Force
Sponsor(s): Representative Mike Murphy and Senator Andy Manar

HJR 16 resolves by the Illinois House of Representatives, with concurrence of the Illinois Senate, that the state-sponsored Health Clinic Task Force is created to study the possibility of implementing a state of Illinois sponsored health clinic for state employees, dependents, and retirees, with the purpose of providing quality care and annual savings to the state’s overall group insurance costs.

HJR 16 resolves that the Task Force be comprised of the following members, to serve without compensation: (1) two individuals appointed by the Speaker of the Illinois House of Representatives; (2) two individuals appointed by the Minority Leader of the Illinois House of Representatives; (3) two individuals appointed by the President of the Illinois Senate; (4) two individuals appointed by the Minority Leader of the Illinois Senate; (5) one individual appointed by the governor of Illinois; and (6) one in individual appointed by the president/director of a union representing the largest amount of state employees.

HJR 16 resolves that the Department of Central Management Services provide administrative support for the Task Force and that the Task Force submit its final report to the General Assembly no later than December 31, 2019, at which time the Task Force is dissolved.

HJR 16 resolves that suitable copies of the resolution be delivered to the director of Central Management Services, the Speaker of the Illinois House of Representatives, the Minority Leader of the Illinois House of Representatives, the President of the Illinois Senate, the Minority Leader of the Illinois Senate, the governor of Illinois, and the president/director of a union representing the largest amount of state employees.

HJR 16 was adopted in both houses on May 31, 2019.

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HR 0006
- Urge Solutions to Windfall Elimination Provision
Sponsor(s): Representative Mary E. Flowers

HR 6 resolves that the Illinois House of Representatives urges President Trump and the United States Congress to continue to work to find a solution to the problems created by the Windfall Elimination Provision.

HR 6 resolves that suitable copies of the resolution be delivered to President Trump, U.S. Senate Majority Leader McConnell, U.S. Senate Minority Leader Schumer, U.S. Speaker of the House Pelosi, U.S. House of Representatives Minority Leader McCarthy, and all members of the Illinois Congressional Delegation.

The Windfall Elimination Provision is a provision of federal law that requires federal Social Security benefits to be offset in order to account for pension benefits provided by the state.

HR 6 was adopted in the House on May 15, 2019.

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HR 0343
- Urge Divestment from For-Profit Companies that Contract to Shelter Migrant Children
Sponsor(s): Representative Elizabeth Hernandez

HR 343 resolves, by the Illinois House of Representatives, that the state of Illinois is urged to divest from any for-profit companies that contract to shelter migrant children.

HR 343 further resolves that suitable copies of the resolution be delivered to the Illinois State Board of Investment, the State Universities Retirement System, the Teachers’ Retirement System, and the Office of the Governor.

HR 343 was adopted in the House on May 30, 2019.

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Senate

SB 0262
- Fiscal Year 2020 Budget
Sponsor(s): Senator John J. Cullerton and Representative Gregory Harris

SB 262 contains the Fiscal Year 2020 Budget. It appropriates $1,854,692,000 for the state contribution to SURS for FY 2020.  Of this amount, $1,639,692,000 comes from the General Revenue Fund and $215,000,000 comes from the State Pensions Fund.   The FY 2020 certified state contribution to SURS is $1,854,692,000.  SB 262 appropriates an amount that is equal to the certified state contribution to SURS for FY 2020.

SB 262 also appropriates $4,431,113 from the Education Assistance Fund to SURS for deposit into the Community College Health Insurance Security Fund for the state contribution to the College Insurance Program for FY 2020.  The College Insurance Program (CIP) provides healthcare for community college retirees.  The FY 2020 certified state contribution to the College Insurance Program (CIP) is $4,431,113.  SB 262 appropriates an amount that is equal to the certified contribution to CIP for FY 2020. 

Finally, SB 262 appropriates $177,500 for the governor’s salary for FY 2020.  This information is relevant for the calculations under the Governor’s Salary Rule (40 ILCS 5/15-155(j-5)), which requires employers to pay the employer normal cost on the portion of an employee’s earnings in excess of the governor’s salary.   This amount is equal to the amount of the governor’s salary for FY 2019.

The appropriations to SURS in SB 262 take effect on July 1, 2019.

Governor Pritzker signed SB 262 into law on June 5, 2019 as Public Act 101-0007.

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SB 0264
- FY 2020 Supplemental Budget and FY 2021 Budget
Sponsor(s): Senator Don Harmon and Representative Gregory Harris

SB 264 appropriates $50,000 from the General Revenue Fund to SURS for employer contributions required by the state as an employer in FY 2020.  These contributions are required due to the collectively bargained back wages paid to participating employees at the Department of Innovation and Technology pursuant to Public Act 101-7.
 
SB 264 appropriates $1,995,767,000 to SURS for the annual required state contribution for FY 2021.  Of this amount, $1,780,767,000 comes from the General Revenue Fund, and $215,000,000 comes from the State Pensions Fund.  This amount is equal to the annual required state contribution certified by SURS for FY 2021.
 
SB 264 appropriates $4,622,773 from the Education Assistance Fund to SURS for deposit into the Community College Health Insurance Security Fund for the state’s contribution to the College Insurance Program (CIP), which provides health insurance benefits for community college retirees.  This amount is equal to the certified contribution to CIP for FY 2021.
 
Finally, SB 264 appropriates $181,700 to the state comptroller for the governor’s salary for fiscal year 2021.  The governor’s salary for fiscal year 2020 is $177,500.  Illinois law (40 ILCS 5/15-155(j-5)) requires employers to pay the employer normal cost on the portion of an employee’s earnings in excess of the governor’s salary.
 
The supplemental funding for FY 2020 takes effec immediately upon becoming law, and the funding for FY 2021 takes effect on July 1, 2020.

Governor Pritzker signed SB 264 into law on June 10, 2020, as Public Act 101-0637.

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SB 1264
- RUUPA – Trailer Bill for Public Retirement Systems
Sponsor(s): Senator Omar Aquino and Representative Robert Martwick

SB 1264 amends the Revised Uniform Unclaimed Property Act to ensure that annuity, pension and benefit funds held in a fiduciary capacity by or on behalf of a retirement system, pension fund or investment board under the Illinois Pension Code remain in their respective trusts. SB 1264 also requires pension funds, retirement systems and investment boards created pursuant to Articles 3, 4 and 22 of the Illinois Pension Code to adhere to certain compliance requirements regarding best practices to locate owners of unclaimed property.

Public retirement systems were previously exempt from the Uniform Distribution of Unclaimed Property Act. However, this exemption did not carry over to the newly created Revised Uniform Unclaimed Property Act, which became effective on January 1, 2018. As a result, under current law, public retirement systems face conflicting requirements under IRS rules and regulations and the new Revised Uniform Unclaimed Property Act. SB 1264 represents a compromise between public retirement systems and the state treasurer’s office on the administration of the Revised Uniform Unclaimed Property Act.

Specifically, as it relates to SURS, SB 1264 requires each public retirement system to report the following information by November 1 of each year to the state treasurer’s office about property presumed abandoned in an annuity, pension or benefit fund held in a fiduciary capacity by or on behalf of that public retirement system: (1) the name of the owner and names of any beneficiaries; (2) the last known address, if known; (3) the Social Security number or taxpayer identification number, if known or readily ascertainable; and (4) the dollar amount. SB 1264 prohibits the payment or delivery of any annuity, pension or benefit funds held in a fiduciary capacity by or on behalf of a public retirement system to the state treasurer’s office. In this manner, SB 1264 allows each public retirement system to keep its assets in its respective trust, while simultaneously enabling the state treasurer’s office to assist in reuniting owners with their unclaimed property.

The provisions of SB 1264 (except for the reporting requirements and the additional compliance provisions for Article 3, 4, and 22 pension funds, retirement systems, and investment boards) apply retroactively to January 1, 2018 (the effective date of the Revised Uniform Unclaimed Property Act).

SB 1264 takes effect in accordance with the Effective Date of Laws Act.

Governor Pritzker signed SB 1264 into law on August 23, 2019, as Public Act 101-0546.

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SB 1265
- SURS Technical Corrections Bill
Sponsor(s): Senator Omar Aquino and Representative Robert Martwick

SB 1265 is an initiative of SURS that makes three technical changes under Article 15 of the Illinois Pension Code. 

First, SB 1265 amends the definition of an “employee” under Section 15-107 to mirror a change to the definition of an “employer” under Section 15-106 by Public Act 100-0611 (which allowed certain legacy employees within the newly created Department of Innovation and  Technology to continue to participate in SURS).  In this manner, SB 1265 ensures consistency between the definitions of “employee” and “employer” under SURS.

Second, SB 1265 amends the definition of “basic compensation” under Section 15-110 to account for the creation of the optional, supplemental defined contribution plan (457 plan) in SURS under Public Act 100-0769.  By treating employee contributions to the optional, supplemental defined contribution plan (457 plan) as part of basic compensation, SB 1265 maintains consistency with the treatment of employee contributions to the state’s Deferred Compensation Plan (457 plan) which are also treated as part of basic compensation.  In this manner, SB 1265 ensures that employees are not penalized for making contributions to the optional, supplemental defined contribution plan in SURS.

Third, SB 1265 corrects a drafting error in Section 15-145.  Under Section 15-131, an unmarried disabled child is considered a “survivor” for benefit purposes if his or her mental or physical disability began prior to the age of 18.  The same section provides that an unmarried, non-disabled child is considered a “survivor” for benefit purposes if he or she is less 18 years of age or is less than 22 years of age and a full-time student.  Under current law, the language in Section 15-145 conflicts with the definition of a “survivor” under Section 15-131.  By correcting the drafting error in Section 15-145, SB 1265 maintains consistency between the section and the definition of a “survivor” under SURS and reflects SURS’ longstanding interpretation and administration of survivor benefits under the Illinois Pension Code.

SB 1265 takes effect immediately upon becoming law.

SB 1265 is identical to HB 2440 of the 101st General Assembly.

Governor Pritzker signed SB 1265 into law on August 9, 2019, as Public Act 101-0321.

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