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1 | AN ACT concerning public employee benefits.
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2 | Be it enacted by the People of the State of Illinois,
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3 | represented in the General Assembly:
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4 | Section 5. The Illinois Pension Code is amended by changing | ||||||
5 | Section 1A-104 as follows:
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6 | (40 ILCS 5/1A-104)
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7 | Sec. 1A-104. Examinations and investigations.
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8 | (a) The Division shall make periodic examinations and | ||||||
9 | investigations of all
pension funds established under this Code | ||||||
10 | and maintained for the benefit of
employees and officers of | ||||||
11 | governmental units in the State of Illinois.
However, in lieu | ||||||
12 | of making an examination and investigation, the Division
may | ||||||
13 | accept and rely upon a report of audit or examination of any | ||||||
14 | pension fund
made by an independent certified public accountant | ||||||
15 | pursuant to the provisions
of the Article of this Code | ||||||
16 | governing the pension fund. The acceptance of the
report of | ||||||
17 | audit or examination does not bar the Division from making a | ||||||
18 | further
audit, examination, and investigation if deemed | ||||||
19 | necessary by the Division.
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20 | The Department may implement a flexible system of | ||||||
21 | examinations under
which it directs resources as it deems | ||||||
22 | necessary or appropriate. In
consultation with the pension fund | ||||||
23 | being examined, the Division may retain
attorneys, independent |
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1 | actuaries, independent certified public accountants, and
other | ||||||
2 | professionals and specialists as examiners, the cost of which | ||||||
3 | (except in
the case of pension funds established under Article | ||||||
4 | 3 or 4) shall be borne by
the pension fund that is the subject | ||||||
5 | of the examination.
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6 | (b) The Division shall examine or investigate each pension | ||||||
7 | fund established
under Article 3 or Article 4 of this Code. The | ||||||
8 | schedule of each examination shall be on a periodic basis as | ||||||
9 | determined by the Division based on a risk review across funds. | ||||||
10 | The risk review
determination shall include, but not be limited | ||||||
11 | to, the following criteria: | ||||||
12 | (1) the funding level of the pension fund; | ||||||
13 | (2) the employer contribution history; | ||||||
14 | (3) the investment return history of the fund; | ||||||
15 | (4) consideration of any complaints received from the | ||||||
16 | pension fund or its
participants; and | ||||||
17 | (5) any previous compliance issues related to the fund | ||||||
18 | such that each fund shall be examined once every 3 years .
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19 | Each examination shall include , but not be limited to, a | ||||||
20 | review of the following:
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21 | (1) an audit of financial transactions, investment | ||||||
22 | policies, and
procedures;
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23 | (2) an examination of books, records, documents, | ||||||
24 | files, and other
pertinent memoranda relating to | ||||||
25 | financial, statistical, and administrative
operations;
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26 | (3) a review of policies and procedures maintained for |
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1 | the administration
and operation of the pension fund;
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2 | (4) a determination of whether or not full effect is | ||||||
3 | being given to the
statutory provisions governing the | ||||||
4 | operation of the pension fund , including the employer's | ||||||
5 | requirement to make a
lawful contribution consistent with | ||||||
6 | Section 4-118 ;
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7 | (5) a determination of whether or not the | ||||||
8 | administrative policies in force
are in accord with the | ||||||
9 | purposes of the statutory provisions and effectively
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10 | protect and preserve the rights and equities of the | ||||||
11 | participants;
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12 | (6) a determination of whether or not proper financial | ||||||
13 | and statistical
records have been established and adequate | ||||||
14 | documentary evidence is recorded and
maintained in support | ||||||
15 | of the several types of annuity and benefit payments
being | ||||||
16 | made; and
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17 | (7) a determination of whether or not the calculations | ||||||
18 | made by the fund for the payment of all annuities and | ||||||
19 | benefits are accurate. | ||||||
20 | In addition, the Division may conduct investigations, | ||||||
21 | which shall be
identified as such and which may include one or | ||||||
22 | more of the items listed in
this subsection.
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23 | A copy of the report of examination or investigation as | ||||||
24 | prepared by the
Division shall be submitted to the secretary of | ||||||
25 | the board of trustees of the
pension fund examined or | ||||||
26 | investigated and to the chief executive officer of the |
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1 | municipality. The Director, upon request, shall grant
a hearing | ||||||
2 | to the officers or trustees of the pension fund or their duly
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3 | appointed representatives, upon any facts contained in the | ||||||
4 | report of
examination. The hearing shall be conducted before | ||||||
5 | filing the report or making
public any information contained in | ||||||
6 | the report. The Director may withhold the
report from public | ||||||
7 | inspection for up to 60 days following the hearing.
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8 | (Source: P.A. 95-950, eff. 8-29-08.)
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9 | Section 99. Effective date. This Act takes effect upon | ||||||
10 | becoming law.
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