093_SB0689ham001 LRB093 09350 LRD 15126 a 1 AMENDMENT TO SENATE BILL 689 2 AMENDMENT NO. . Amend Senate Bill 689 by replacing 3 everything after the enacting clause with the following: 4 "Section 5. The Illinois Lottery Law is amended by 5 changing Section 13 and adding Section 13.1 as follows: 6 (20 ILCS 1605/13) (from Ch. 120, par. 1163) 7 Sec. 13. Except as otherwise provided in Section 13.1, 8 no prize, nor any portion of a prize, nor any right of any 9 person to a prize awarded shall be assignable. Any prize, or 10 portion thereof remaining unpaid at the death of a prize 11 winner, may be paid to the estate of such deceased prize 12 winner, or to the trustee under a revocable living trust 13 established by the deceased prize winner as settlor, provided 14 that a copy of such a trust has been filed with the 15 Department along with a notarized letter of direction from 16 the settlor and no written notice of revocation has been 17 received by the Department prior to the settlor's death. 18 Following such a settlor's death and prior to any payment to 19 such a successor trustee, the Director shall obtain from the 20 trustee and each trust beneficiary a written agreement to 21 indemnify and hold the Department harmless with respect to 22 any claims that may be asserted against the Department -2- LRB093 09350 LRD 15126 a 1 arising from payment to or through the trust. 2 Notwithstanding any other provision of this Section, any 3 person pursuant to an appropriate judicial order may be paid 4 the prize to which a winner is entitled, and all or part of 5 any prize otherwise payable by State warrant under this 6 Section shall be withheld upon certification to the State 7 Comptroller from the Illinois Department of Public Aid as 8 provided in Section 10-17.5 of The Illinois Public Aid Code. 9 The Director shall be discharged of all further liability 10 upon payment of a prize pursuant to this Section. 11 (Source: P.A. 85-1224.) 12 (20 ILCS 1605/13.1 new) 13 Sec. 13.1. Assignment of prizes payable in installments. 14 (a) The right of any person to receive payments under a 15 prize that is paid in installments over time by the 16 Department may be voluntarily assigned, in whole or in part, 17 if the assignment is made to a person or entity designated 18 pursuant to an order of a court of competent jurisdiction 19 located in the judicial circuit where the assigning prize 20 winner resides or where the headquarters of the Department is 21 located. A court may issue an order approving a voluntary 22 assignment and directing the Department to make prize 23 payments in whole or in part to the designated assignee, if 24 the court finds that all of the following conditions have 25 been met: 26 (1) The assignment is in writing, is executed by 27 the assignor, and is, by its terms, subject to the laws 28 of this State. 29 (2) The purchase price being paid for the payments 30 being assigned represents a present value of the payments 31 being assigned, discounted at an annual rate that does 32 not exceed 10 percentage points over the Wall Street 33 Journal prime rate published on the business day prior to -3- LRB093 09350 LRD 15126 a 1 the date of execution of the contract. 2 (3) The contract of assignment expressly states 3 that the assignor has 3 business days after the contract 4 was signed to cancel the assignment. 5 (4) The assignor provides a sworn affidavit 6 attesting that he or she: 7 (i) is of sound mind, is in full command of 8 his or her faculties, and is not acting under 9 duress; 10 (ii) has been advised regarding the assignment 11 by his or her own independent legal counsel, who is 12 unrelated to and is not being compensated by the 13 assignee or any of the assignee's affiliates, and 14 has received independent financial or tax advice 15 concerning the effects of the assignment from a 16 lawyer or other professional who is unrelated to and 17 is not being compensated by the assignee or any of 18 the assignee's affiliates; 19 (iii) understands that he or she will not 20 receive the prize payments or portions thereof for 21 the years assigned; 22 (iv) understands and agrees that, with regard 23 to the assigned payments, the Department and its 24 officials and employees will have no further 25 liability or responsibility to make the assigned 26 payments to him or her; 27 (v) has been provided with a one-page written 28 disclosure statement setting forth, in bold type of 29 not less than 14 points, the payments being 30 assigned, by amounts and payment dates; the purchase 31 price being paid; the rate of discount to present 32 value, assuming daily compounding and funding on the 33 contract date; and the amount, if any, of any 34 origination or closing fees that will be charged to -4- LRB093 09350 LRD 15126 a 1 him or her; and 2 (vi) was advised in writing, at the time he or 3 she signed the assignment contract, that he or she 4 had the right to cancel the contract, without any 5 further obligation, within 3 business days following 6 the date on which the contract was signed. 7 (5) Written notice of the proposed assignment and 8 any court hearing concerning the proposed assignment is 9 provided to the Department's counsel at least 30 days 10 prior to any court hearing. The Department is not 11 required to appear in or be named as a party to any such 12 action seeking judicial confirmation of an assignment 13 under this Section, but may intervene as of right in any 14 such proceeding. 15 (b) A certified copy of a court order approving a 16 voluntary assignment must be provided to the Department no 17 later than 30 days before the date on which the payment is to 18 be made. 19 (c) A court order obtained pursuant to this Section, 20 together with all such prior orders, shall not require the 21 Department to divide any single prize payment among more than 22 3 different persons. Nothing in this Section shall prohibit 23 substituting assignees as long as there are no more than 3 24 assignees at any one time for any one prize payment. 25 (d) If a husband and wife are co-owners of a prize, any 26 assignment of the prize must be made jointly. 27 (e) A voluntary assignment may not include portions of 28 payments that are subject to offset on account of a defaulted 29 or delinquent child support obligation, non-wage garnishment, 30 or criminal restitution obligation or on account of a debt 31 owed to a State agency. Each court order issued under 32 subsection (a) shall provide that any delinquent child 33 support or criminal restitution obligations of the assigning 34 prize winner and any debts owed to a State agency by the -5- LRB093 09350 LRD 15126 a 1 assigning prize winner, as of the date of the court order, 2 shall be set off by the Department first against remaining 3 payments or portions thereof due the prize winner and then 4 against payments due the assignee. 5 (f) The Department and its respective officials and 6 employees shall be discharged of all liability upon payment 7 of an assigned prize under this Section. The assignor and 8 assignee shall hold harmless and indemnify the Department, 9 the State of Illinois, and its employees and agents from all 10 claims, actions, suits, complaints, and liabilities related 11 to the assignment. 12 (g) The Department may establish a reasonable fee to 13 defray any administrative expenses associated with 14 assignments made under this Section, including the cost to 15 the Department of any processing fee that may be imposed by a 16 private annuity provider. The fee amount shall reflect the 17 direct and indirect costs associated with processing 18 assignments. 19 (h) If at any time the Internal Revenue Service or a 20 court of competent jurisdiction issues a determination 21 letter, revenue ruling, other public ruling of the Internal 22 Revenue Service, or published decision to the Department or 23 to any lottery prize winner declaring that the voluntary 24 assignment of prizes will affect the federal income tax 25 treatment of prize winners who do not assign their prizes, 26 the Department shall immediately file a copy of that letter, 27 ruling, or published decision with the Attorney General, the 28 Secretary of State, and the Administrative Office of the 29 Illinois Courts. A court may not issue an order authorizing a 30 voluntary assignment under this Section after the date any 31 such ruling, letter, or published decision is filed. 32 (i) A contract of assignment in which the assignor is a 33 lottery winner shall include a sworn affidavit from the 34 assignee. The form of the affidavit shall be established by -6- LRB093 09350 LRD 15126 a 1 the Department and shall include: 2 (1) a summary of assignee contacts with the winner; 3 (2) a summary of any lawsuits, claims, and other 4 legal actions from lottery winners regarding conduct of 5 the assignee or its agents; 6 (3) a statement that the assignee is in good 7 standing in its state of domicile and with any other 8 licensing or regulatory agency as may be required in the 9 conduct of its business; 10 (4) a brief business history of the assignee; 11 (5) a statement describing the nature of the 12 business of the assignee; and 13 (6) a statement of the assignee's privacy and 14 non-harassment policies and express affirmation that the 15 assignee has followed those policies in Illinois. 16 (j) The assignee shall notify the Department of its 17 business location and mailing address for payment purposes 18 during the entire course of the assignment.".