STATE INVESTMENTS-SUDAN15 ILCS 520/7.5 new15 ILCS 520/15from Ch. 130, par. 3415 ILCS 520/22.5from Ch. 130, par. 41a40 ILCS 5/1-110from Ch. 108 1/2, par. 1-110Amends the Deposit of State Moneys Act. Provides that a bank or savings and loan association is disqualified as a State depository upon making a loan to certain entities doing business in or with the government of Sudan until such time as the United Nations determines that the government of Sudan has taken sufficient and demonstrable steps to end human rights abuses in that nation. Amends the Illinois Pension Code. Prohibits the investment or deposit from the retirement system or pension fund to certain entities doing business in or with the government of Sudan until such time as the United Nations determines that the government of Sudan has taken sufficient and demonstrable steps to end human rights abuses in that nation. Effective immediately.FISCAL NOTE ACT MAY APPLYPENSION IMPACT NOTE ACT MAY APPLYSB0023LRB09403731BDD33740bAN ACT concerning State government.Be it enacted by the People of the State of Illinois,
represented in the General Assembly:Section 5. The Deposit of State Moneys Act is amended by changing Sections 15 and 22.5 and by adding Section 7.5 as follows:(15 ILCS 520/7.5 new)Sec. 7.5. Mandatory rejection of certain proposals. The State Treasurer must reject a proposal of any eligible institution that, on or after the effective date of this amendatory Act of the 94th General Assembly, makes a loan to any individual, firm, corporation, agency, association, or other entity for the purpose of doing business in or with the government of Sudan until such time as the United Nations determines that the government of Sudan has taken sufficient and demonstrable steps to:(i) ensure that the armed forces of Sudan and any associated militias are not committing human rights atrocities or obstructing human rights monitors or the provision of humanitarian assistance;(ii) demobilize and disarm militias supported or created by the government of Sudan; and(iii) allow full and unfettered humanitarian assistance to all regions of Sudan, including Dafur.(15 ILCS 520/15)(from Ch. 130, par. 34)Sec. 15. (a) A bank or savings and loan association approved as a
depositary shall cease to be an approved bank or savings and loan
association, and shall be disqualified by the State Treasurer:(1) Upon its failure to post a suitable bond or deposit securities
with the State Treasurer;(2) Upon its failure or refusal to pay over public moneys or any part
thereof;(3) Upon its becoming insolvent or bankrupt, or being placed in the
hands of a receiver;(4) Upon a showing of unsatisfactory financial condition through a
report made to, or an examination made by, the Comptroller of the Currency, the
Commissioner of Banks and Real Estate, or the Federal Home Loan Bank or its
successors;.(5) Upon making any loan that would require the rejection of a proposal under Section 7.5 of this Act.(b) No approved depositary shall be disqualified by the State
Treasurer solely by reason of its acquisition by another institution.(15 ILCS 520/22.5)(from Ch. 130, par. 41a)Sec. 22.5. Permitted investments. The State Treasurer may, with the
approval of the Governor, invest and reinvest any State money in the treasury
which is not needed for current expenditures due or about to become due, in
obligations of the United States government or its agencies or of National
Mortgage Associations established by or under the National Housing Act, 1201
U.S.C. 1701 et seq., or
in mortgage participation certificates representing undivided interests in
specified, first-lien conventional residential Illinois mortgages that are
underwritten, insured, guaranteed, or purchased by the Federal Home Loan
Mortgage Corporation or in Affordable Housing Program Trust Fund Bonds or
Notes as defined in and issued pursuant to the Illinois Housing Development
Act. All such obligations shall be considered as cash and may
be delivered over as cash by a State Treasurer to his successor.The State Treasurer may, with the approval of the Governor, purchase
any state bonds with any money in the State Treasury that has been set
aside and held for the payment of the principal of and interest on the
bonds. The bonds shall be considered as cash and may be delivered over
as cash by the State Treasurer to his successor.The State Treasurer may, with the approval of the Governor, invest or
reinvest any State money in the treasury that is not needed for
current expenditure due or about to become due, or any money in the
State Treasury that has been set aside and held for the payment of the
principal of and the interest on any State bonds, in shares,
withdrawable accounts, and investment certificates of savings and
building and loan associations, incorporated under the laws of this
State or any other state or under the laws of the United States;
provided, however, that investments may be made only in those savings
and loan or building and loan associations the shares and withdrawable
accounts or other forms of investment securities of which are insured
by the Federal Deposit Insurance Corporation.The State Treasurer may not invest State money in any savings and
loan or building and loan association unless a commitment by the savings
and loan (or building and loan) association, executed by the president
or chief executive officer of that association, is submitted in the
following form:The .................. Savings and Loan (or Building and Loan)
Association pledges not to reject arbitrarily mortgage loans for
residential properties within any specific part of the community served
by the savings and loan (or building and loan) association because of
the location of the property. The savings and loan (or building and
loan) association also pledges to make loans available on low and
moderate income residential property throughout the community within
the limits of its legal restrictions and prudent financial practices. The .................. Savings and Loan (or Building and Loan)
Association further pledges not to make a loan that would require the rejection of a proposal under Section 7.5 of this Act.The State Treasurer may, with the approval of the Governor, invest or
reinvest, at a price not to exceed par, any State money in the treasury
that is not needed for current expenditures due or about to become
due, or any money in the State Treasury that has been set aside and
held for the payment of the principal of and interest on any State
bonds, in bonds issued by counties or municipal corporations of the
State of Illinois.The State Treasurer may, with the approval of the Governor, invest or
reinvest any State money in the Treasury which is not needed for current
expenditure, due or about to become due, or any money in the State Treasury
which has been set aside and held for the payment of the principal of and
the interest on any State bonds, in participations in loans, the principal
of which participation is fully guaranteed by an agency or instrumentality
of the United States government; provided, however, that such loan
participations are represented by certificates issued only by banks which
are incorporated under the laws of this State or any other state
or under the laws of the United States, and such banks, but not
the loan participation certificates, are insured by the Federal Deposit
Insurance Corporation.The State Treasurer may, with the approval of the Governor, invest or
reinvest any State money in the Treasury that is not needed for current
expenditure, due or about to become due, or any money in the State Treasury
that has been set aside and held for the payment of the principal of and
the interest on any State bonds, in any of the following:(1) Bonds, notes, certificates of indebtedness, Treasury bills, or other
securities now or hereafter issued that are guaranteed by the full faith
and credit of the United States of America as to principal and interest.(2) Bonds, notes, debentures, or other similar obligations of the United
States of America, its agencies, and instrumentalities.(2.5) Bonds, notes, debentures, or other similar obligations of a
foreign government that are guaranteed by the full faith and credit of that
government as to principal and interest, but only if the foreign government
has not defaulted and has met its payment obligations in a timely manner on
all similar obligations for a period of at least 25 years immediately before
the time of acquiring those obligations.(3) Interest-bearing savings accounts, interest-bearing certificates of
deposit, interest-bearing time deposits, or any other investments
constituting direct obligations of any bank as defined by the Illinois
Banking Act.(4) Interest-bearing accounts, certificates of deposit, or any other
investments constituting direct obligations of any savings and loan
associations incorporated under the laws of this State or any other state or
under the laws of the United States.(5) Dividend-bearing share accounts, share certificate accounts, or
class of share accounts of a credit union chartered under the laws of this
State or the laws of the United States; provided, however, the principal
office of the credit union must be located within the State of Illinois.(6) Bankers' acceptances of banks whose senior obligations are rated in
the top 2 rating categories by 2 national rating agencies and maintain that
rating during the term of the investment.(7) Short-term obligations of corporations organized in the United
States with assets exceeding $500,000,000 if (i) the obligations are rated
at the time of purchase at one of the 3 highest classifications established
by at least 2 standard rating services and mature not later than
180 days from the date of purchase, (ii) the purchases do not exceed 10% of
the corporation's outstanding obligations, and (iii) no more than one-third of
the public agency's funds are invested in short-term obligations of
corporations.(8) Money market mutual funds registered under the Investment Company
Act of 1940, provided that the portfolio of the money market mutual fund is
limited to obligations described in this Section and to agreements to
repurchase such obligations.(9) The Public Treasurers' Investment Pool created under Section 17 of
the State Treasurer Act or in a fund managed, operated, and administered by
a bank.(10) Repurchase agreements of government securities having the meaning
set out in the Government Securities Act of 1986 subject to the provisions
of that Act and the regulations issued thereunder.(11) Investments made in accordance with the Technology Development
Act.For purposes of this Section, "agencies" of the United States
Government includes:(i) the federal land banks, federal intermediate credit banks, banks for
cooperatives, federal farm credit banks, or any other entity authorized
to issue debt obligations under the Farm Credit Act of 1971 (12 U.S.C. 2001
et seq.) and Acts amendatory thereto;(ii) the federal home loan banks and the federal home loan
mortgage corporation;(iii) the Commodity Credit Corporation; and(iv) any other agency created by Act of Congress.The Treasurer may, with the approval of the Governor, lend any securities
acquired under this Act. However, securities may be lent under this Section
only in accordance with Federal Financial Institution Examination Council
guidelines and only if the securities are collateralized at a level sufficient
to assure the safety of the securities, taking into account market value
fluctuation. The securities may be collateralized by cash or collateral
acceptable under Sections 11 and 11.1.Section 10. The Illinois Pension Code is amended by changing Section 1-110 as follows:(40 ILCS 5/1-110)(from Ch. 108 1/2, par. 1-110)Sec. 1-110. Prohibited Transactions. (a) A fiduciary with respect to a retirement system or pension fund shall
not cause the retirement system or pension fund to engage in a transaction if
he or she knows or should know that such transaction constitutes a direct or
indirect:(1) Sale or exchange, or leasing of any property from the retirement
system
or pension fund to a party in interest for less than adequate consideration,
or from a party in interest to a retirement system or pension fund for more
than adequate consideration.(2) Lending of money or other extension of credit from the retirement
system or pension fund to a party in interest without the receipt of adequate
security and a reasonable rate of interest, or from a party in interest to
a retirement system or pension fund with the provision of excessive security
or an unreasonably high rate of interest.(3) Furnishing of goods, services or facilities from the retirement
system or pension fund to a party in interest for less than adequate
consideration, or from a party in interest to a retirement system or
pension fund for more than adequate consideration.(4) Transfer to, or use by or for the benefit of, a party in interest
of any assets of a retirement system or pension fund for less than adequate
consideration.(5) Investment or deposit in any individual, firm, corporation, agency, association, or other entity for the purpose of doing business in or with the government of Sudan until such time as the United Nations determines that the government of Sudan has taken sufficient and demonstrable steps to:(i) ensure that the armed forces of Sudan and any associated militias are not committing human rights atrocities or obstructing human rights monitors or the provision of humanitarian assistance;(ii) demobilize and disarm militias supported or created by the government of Sudan; and(iii) allow full and unfettered humanitarian assistance to all regions of Sudan, including Dafur.(b) A fiduciary with respect to a retirement system or pension fund
established under this Code shall not:(1) Deal with the assets of the retirement system or pension fund in his
own interest or for his own account;(2) In his individual or any other capacity act in any transaction
involving the retirement system or pension fund on behalf of a party whose
interests are adverse to the interests of the retirement system or pension fund
or the interests of its participants or beneficiaries; or(3) Receive any consideration for his own personal account from any party
dealing with the retirement system or pension fund in connection with a
transaction involving the assets of the retirement system or pension
fund.(c) Nothing in this Section shall be construed to prohibit any trustee from:(1) Receiving any benefit to which he may be entitled as a participant
or beneficiary in the retirement system or pension fund.(2) Receiving any reimbursement of expenses properly and actually incurred
in the performance of his duties with the retirement system or pension fund.(3) Serving as a trustee in addition to being an officer, employee, agent
or other representative of a party in interest.Section 99. Effective date. This Act takes effect upon becoming law.