Bill Text: IL HB3336 | 2011-2012 | 97th General Assembly | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

---

Bill Title: Amends the Counties Code and Illinois Municipal Code to provide that if a county or municipality offers a 457(b) plan to its officers, employees, or both, or makes contributions to such a plan on behalf of its officers, employees, or both, then that county or municipality, and the persons acting under its authority, must act in accordance with the prudent investor rule when making plan-related decisions. Limits the concurrent exercise of home rule powers. Amends the School Code to provide that if a school board other than the Chicago Board of Education offers a 403(b) or 457(b) plan to its officers, employees, or both, or makes contributions to such a plan on behalf of its officers, employees, or both, then that school board, and the persons acting under its authority, must act in accordance with the prudent investor rule when making plan-related decisions. Amends the State Mandates Act to require implementation without reimbursement.

Spectrum: Partisan Bill (Democrat 5-0)

Status: (Failed) 2013-01-08 - Session Sine Die [HB3336 Detail]

Download: Illinois-2011-HB3336-Introduced.html

---

97TH GENERAL ASSEMBLY State of Illinois 2011 and 2012 HB3336 Introduced 2/24/2011, by Rep. Elaine Nekritz SYNOPSIS AS INTRODUCED:
55 ILCS 5/Div. 6-35 heading new
55 ILCS 5/6-35000 new
65 ILCS 5/8-1-20 new
105 ILCS 5/10-20.53 new
30 ILCS 805/8.35 new
Amends the Counties Code and Illinois Municipal Code to provide that if a county or municipality offers a 457(b) plan to its officers, employees, or both, or makes contributions to such a plan on behalf of its officers, employees, or both, then that county or municipality, and the persons acting under its authority, must act in accordance with the prudent investor rule when making plan-related decisions. Limits the concurrent exercise of home rule powers. Amends the School Code to provide that if a school board other than the Chicago Board of Education offers a 403(b) or 457(b) plan to its officers, employees, or both, or makes contributions to such a plan on behalf of its officers, employees, or both, then that school board, and the persons acting under its authority, must act in accordance with the prudent investor rule when making plan-related decisions. Amends the State Mandates Act to require implementation without reimbursement.
LRB097 06673 KMW 46759 b
FISCAL NOTE ACT MAY APPLY HOME RULE NOTE ACT MAY APPLY HOUSING AFFORDABILITY IMPACT NOTE ACT MAY APPLY
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY
A BILL FOR
HB3336 LRB097 06673 KMW 46759 b
AN ACT concerning local government.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Counties Code is amended by adding the
heading of Div. 6-35 and Section 6-35000 as follows:
(55 ILCS 5/Div. 6-35 heading new)
Division 6-35. Application of the Prudent Investor Rule
to Eligible Deferred Compensation Plans
(55 ILCS 5/6-35000 new)
Sec. 6-35000. Application of the prudent investor rule to
457(b) plans.
(a) If a county offers a 457(b) plan to its officers,
employees, or both, or makes contributions to such a plan on
behalf of its officers, employees, or both, then the county
board and those persons acting under its authority must act in
accordance with the prudent investor rule when making
plan-related decisions.
(b) For the purposes of this Section, a person acts in
accordance with the prudent investor rule if he or she acts in
good faith and with the care, skill, prudence, diligence, and
degree of judgment that an investor of prudence, discretion,
and good judgment would exercise in the management of his or

HB3336 - 2 - LRB097 06673 KMW 46759 b
her own affairs, taking into account the probable safety of the
plan capital as well as the probable investment return to be
derived from the invested assets.
(c) A home rule unit may not regulate a county board's or
its agents' plan-related fiduciary obligations in a manner that
is less restrictive than the regulation by the State of those
obligations under subsection (a). This subsection (c) is a
limitation under subsection (i) of Section 6 of Article VII of
the Illinois Constitution on the concurrent exercise by home
rule units of powers and functions exercised by the State.
(d) This Section does not apply to any plan authorized or
created under the Illinois Pension Code.
Section 10. The Illinois Municipal Code is amended by
adding Section 8-1-20 as follows:
(65 ILCS 5/8-1-20 new)
Sec. 8-1-20. Application of the prudent investor rule to
457(b) plans.
(a) If a municipality offers a 457(b) plan to its officers,
employees, or both, or makes contributions to such a plan on
behalf of its officers, employees, or both, then the corporate
authorities of the municipality and those persons acting under
their authority must act in accordance with the prudent
investor rule when making plan-related decisions.
(b) For the purposes of this Section, a person acts in

HB3336 - 3 - LRB097 06673 KMW 46759 b
accordance with the prudent investor rule if he or she acts in
good faith and with the care, skill, prudence, diligence, and
degree of judgment that an investor of prudence, discretion,
and sound judgment would exercise in the management of his or
her own affairs, taking into account the probable safety of the
plan capital as well as the probable investment return to be
derived from the invested assets.
(c) A home rule unit may not regulate a municipal corporate
authority's or its agents' plan-related fiduciary obligations
in a manner that is less restrictive than the regulation by the
State of those obligations under subsection (a). This
subsection (c) is a limitation under subsection (i) of Section
6 of Article VII of the Illinois Constitution on the concurrent
exercise by home rule units of powers and functions exercised
by the State.
(d) This Section does not apply to any plan authorized or
created under the Illinois Pension Code.
Section 15. The School Code is amended by adding Section
10-20.53 as follows:
(105 ILCS 5/10-20.53 new)
Sec. 10-20.53. Application of the prudent investor rule to
403(b) and 457(b) plans.
(a) If a school board other than the Chicago Board of
Schools offers a 403(b) or 457(b) plan to its officers,

HB3336 - 4 - LRB097 06673 KMW 46759 b
employees, or both, or makes contributions to such a plan on
behalf of its officers, employees, or both, then the board and
those persons acting under its authority must act in accordance
with the prudent investor rule when making plan-related
decisions.
(b) For the purposes of this Section, a person acts in
accordance with the prudent investor rule if he or she acts in
good faith and with the care, skill, prudence, diligence, and
degree of judgment that an investor of prudence, discretion,
and sound judgment would exercise in the management of his or
her own affairs, taking into account the probable safety of the
plan capital as well as the probable investment return to be
derived from the invested assets.
(c) This Section does not apply to any plan authorized or
created under the Illinois Pension Code.
Section 90. The State Mandates Act is amended by adding
Section 8.35 as follows:
(30 ILCS 805/8.35 new)
Sec. 8.35. Exempt mandate. Notwithstanding Sections 6 and 8
of this Act, no reimbursement by the State is required for the
implementation of any mandate created by this amendatory Act of
the 97th General Assembly.