Bill Amendment: IL SB3071 | 2015-2016 | 99th General Assembly

NOTE: For additional amemendments please see the Bill Drafting List

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Bill Title: PEN CD-ISBI-CUSTODIAN

Status: 2016-07-29 - Public Act . . . . . . . . . 99-0708 [SB3071 Detail]

Download: Illinois-2015-SB3071-Senate_Amendment_001.html

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Sen. James F. Clayborne, Jr.

Filed: 4/11/2016

09900SB3071sam001 LRB099 18394 RPS 45582 a
AMENDMENT TO SENATE BILL 3071
AMENDMENT NO. ______. Amend Senate Bill 3071 by replacing
everything after the enacting clause with the following:
"Section 5. The Illinois Pension Code is amended by
changing Sections 22A-109, 22A-111, 22A-113.1, 22A-113.2, and
22A-113.3 as follows:
(40 ILCS 5/22A-109) (from Ch. 108 1/2, par. 22A-109)
Sec. 22A-109. Membership of board. The board shall consist
of the following members:
(1) Five trustees appointed by the Governor with the
advice and consent of the Senate who may not hold an
elective State office.
(2) The Treasurer.
(3) The Comptroller, who shall represent the State
Employees' Retirement System of Illinois.
(4) The Chairperson of the General Assembly Retirement

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System.
(5) The Chairperson of the Judges Retirement System of
Illinois.
The appointive members shall serve for terms of 4 years except
that the terms of office of the original appointive members
pursuant to this amendatory Act of the 96th General Assembly
shall be as follows: One member for a term of 1 year; 1 member
for a term of 2 years; 1 member for a term of 3 years; and 2
members for a term of 4 years. Vacancies among the appointive
members shall be filled for unexpired terms by appointment in
like manner as for original appointments, and appointive
members shall continue in office until their successors have
been appointed and have qualified.
Notwithstanding any provision of this Section to the
contrary, the term of office of each trustee of the Board
appointed by the Governor who is sitting on the Board on the
effective date of this amendatory Act of the 96th General
Assembly is terminated on that effective date. A trustee
sitting on the board on the effective date of this amendatory
Act of the 96th General Assembly may not hold over in office
for more than 60 days after the effective date of this
amendatory Act of the 96th General Assembly. Nothing in this
Section shall prevent the Governor from making a temporary
appointment or nominating a trustee holding office on the day
before the effective date of this amendatory Act of the 96th
General Assembly.

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Each person appointed to membership shall qualify by taking
an oath of office before the Secretary of State stating that he
will diligently and honestly administer the affairs of the
board and will not violate or knowingly permit the violation of
any provisions of this Article.
Members of the board shall receive no salary for service on
the board but shall be reimbursed for travel expenses incurred
while on business for the board according to the standards in
effect for members of the Illinois Legislative Research Unit.
A majority of the members of the board shall constitute a
quorum. The board shall elect from its membership, biennially,
a Chairman, Vice Chairman and a Recording Secretary. These
officers, together with one other member elected by the board,
shall constitute the executive committee. During the interim
between regular meetings of the board, the executive committee
shall have authority to conduct all business of the board and
shall report such business conducted at the next following
meeting of the board for ratification.
No member of the board shall have any interest in any
brokerage fee, commission or other profit or gain arising out
of any investment made by the board. This paragraph does not
preclude ownership by any member of any minority interest in
any common stock or any corporate obligation in which
investment is made by the board.
The board shall contract for a blanket fidelity bond in the
penal sum of not less than $1,000,000.00 to cover members of

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the board, the director and all other employees of the board
conditioned for the faithful performance of the duties of their
respective offices, the premium on which shall be paid by the
board. The bond shall be filed with the State Treasurer for
safekeeping.
(Source: P.A. 96-6, eff. 4-3-09.)
(40 ILCS 5/22A-111) (from Ch. 108 1/2, par. 22A-111)
Sec. 22A-111. The Board shall manage the investments of any
pension fund, retirement system, or education fund for the
purpose of obtaining a total return on investments for the long
term. It also shall perform such other functions as may be
assigned or directed by the General Assembly.
The authority of the board to manage pension fund
investments and the liability shall begin when there has been a
physical transfer of the pension fund investments to the board
and placed in the custody of the board's custodian State
Treasurer.
The authority of the board to manage monies from the
education fund for investment and the liability of the board
shall begin when there has been a physical transfer of
education fund investments to the board and placed in the
custody of the board's custodian State Treasurer.
The board may not delegate its management functions, but it
may, but is not required to, arrange to compensate for
personalized investment advisory service for any or all

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investments under its control with any national or state bank
or trust company authorized to do a trust business and
domiciled in Illinois, other financial institution organized
under the laws of Illinois, or an investment advisor who is
qualified under Federal Investment Advisors Act of 1940 and is
registered under the Illinois Securities Law of 1953. Nothing
contained herein shall prevent the Board from subscribing to
general investment research services available for purchase or
use by others. The Board shall also have the authority to
compensate for accounting services.
This Section shall not be construed to prohibit the
Illinois State Board of Investment from directly investing
pension assets in public market investments, private
investments, real estate investments, or other investments
authorized by this Code.
(Source: P.A. 96-1554, eff. 3-18-11.)
(40 ILCS 5/22A-113.1) (from Ch. 108 1/2, par. 22A-113.1)
Sec. 22A-113.1. Investable funds.
Each retirement system under the management of the Illinois
State Board of Investment shall report to the board from time
to time the amounts of funds available for investment. These
amounts shall be transferred immediately to the board's
custodian or the custodian's State Treasurer or his authorized
agent for the account of the board to be applied for investment
by the board. Notice to the Illinois State Board of Investment

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of each such transfer shall be given by the retirement system
as the transfer occurs.
(Source: P.A. 78-646.)
(40 ILCS 5/22A-113.2) (from Ch. 108 1/2, par. 22A-113.2)
Sec. 22A-113.2. Custodian State Treasurer.
The securities, funds and other assets transferred to the
The Illinois State Board of Investment or otherwise acquired by
the board shall be placed in the custody of the board's
custodian. The custodian shall State Treasurer who shall serve
as official custodian of the board, provide adequate safe
deposit facilities therefor and hold all such securities, funds
and other assets subject to the order of the board.
As soon as may be practicable, but in no event later than
December 31, 2016, the board shall appoint and retain a
qualified custodian. Until a custodian has been appointed by
the board, the State Treasurer shall serve as official
custodian of the board.
The State Treasurer shall furnish a corporate surety bond
of such amount as the board designates, which bond shall
indemnify the board against any loss that may result from any
action or failure to act by the Treasurer or any of his agents.
All charges incidental to the procuring and giving of such bond
shall be paid by the board. The bond shall be in the custody of
the board.
(Source: P.A. 77-611.)

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(40 ILCS 5/22A-113.3) (from Ch. 108 1/2, par. 22A-113.3)
Sec. 22A-113.3. Investable funds of education foundation.
The Illinois Bank Examiners' Education Foundation shall report
to the board from time to time the amounts of monies available
for investment by the board. These amounts shall be transferred
promptly to the board's custodian or the custodian's State
Treasurer or his authorized agent for the account of the board
to be applied for investment by the board. Notice to the board
of each such transfer shall be given by the Illinois Bank
Examiners' Education Foundation after the transfer occurs.
(Source: P.A. 84-1127.)
Section 99. Effective date. This Act takes effect upon
becoming law.".