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| Public Act 104-0620 | ||||
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AN ACT concerning public employee benefits. | ||||
Be it enacted by the People of the State of Illinois, | ||||
represented in the General Assembly: | ||||
Section 5. The Illinois Municipal Code is amended by | ||||
adding Section 10-4-3.5 as follows: | ||||
(65 ILCS 5/10-4-3.5 new) | ||||
Sec. 10-4-3.5. Automatic enrollment in deferred | ||||
compensation plan required. | ||||
(a) As used in this Section, "eligible deferred | ||||
compensation plan" has the meaning given in subsection (b) of | ||||
Section 457 of the federal Internal Revenue Code. | ||||
(b) Beginning January 1, 2027, a municipality with a | ||||
population of 500,000 or more shall automatically enroll all | ||||
employees of the municipality who first become employees of | ||||
the municipality on or after January 1, 2027 and who are | ||||
participants in a pension fund established under Article 5, 6, | ||||
or 8 of the Illinois Pension Code into an eligible deferred | ||||
compensation plan that the municipality has established for | ||||
its employees. If a municipality has not established an | ||||
eligible deferred compensation plan for its employees, then | ||||
the municipality shall establish an eligible deferred | ||||
compensation plan for its employees on or before January 1, | ||||
2027. | ||||
(c) An employee subject to automatic enrollment under this | ||
Section shall have the option to opt out of the plan and shall | ||
be informed of that option within 30 days after being hired. | ||
(d) If another option is not chosen by the employee, then | ||
the default employee contribution to the account shall be 3% | ||
of the employee's salary. The plan administrator may | ||
automatically increase employees' contributions by no more | ||
than 1% per year, and an employee may choose to opt out of the | ||
automatic increases. | ||
(e) Municipalities, including home rule municipalities, | ||
may not regulate deferred compensation programs in a manner | ||
inconsistent with this Section. This Section is a denial and | ||
limitation of home rule powers and functions under subsection | ||
(i) of Section 6 of Article VII of the Illinois Constitution. | ||
Section 90. The State Mandates Act is amended by adding | ||
Section 8.50 as follows: | ||
(30 ILCS 805/8.50 new) | ||
Sec. 8.50. 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 104th General Assembly. | ||
Section 99. Effective date. This Act takes effect upon | ||
becoming law. | ||