102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
SB1675

 

Introduced 2/26/2021, by Sen. Robert F. Martwick

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/24-105.2

    Amends the Deferred Compensation Article of the Illinois Pension Code. In a provision concerning automatic enrollment in the deferred compensation plan for employees under the General Assembly, State Employee, or Judges Article, provides that the Illinois State Board of Investment may increase the default percentage amount of compensation deferred into employee accounts. Provides that any agency with employees subject to automatic enrollment must systematically provide the employee data necessary for enrollment to the Department of Central Management Services or its designee. Includes any applicable earnings, investment fees, and administrative fees in the refund of amounts deferred for an employee who elects to withdraw from the plan within 90 days of enrollment. Provides that the Board shall establish annual, automatic increases to employee contribution rates for employees who are automatically enrolled in the deferred compensation plan. Provides that the amount of automatic annual increases to employee contribution rates in any 12-month period shall not exceed 1% of compensation. Provides that employees may elect to not receive automatic annual increases in a manner described by the Board. Makes other changes. Effective July 1, 2021.


LRB102 14094 RPS 19446 b

FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB1675LRB102 14094 RPS 19446 b

1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by
5changing Section 24-105.2 as follows:
 
6    (40 ILCS 5/24-105.2)
7    Sec. 24-105.2. Automatic enrollment for certain employees
8members. The Department of Central Management Services shall
9automatically enroll in the State Employees Deferred
10Compensation Plan any employee who, on or after July 1, 2020, 6
11months after the effective date of this amendatory Act of the
12101st General Assembly, first becomes an active a member or
13participant of a retirement system created under Article 2,
1414, or 18. Any agency with employees subject to automatic
15enrollment must systematically provide the employee data
16necessary for enrollment to the Department of Central
17Management Services or its designee. An employee automatically
18enrolled under this Section shall have 3% of his or her pre-tax
19gross compensation for each compensation period deferred into
20his or her deferred compensation account. The Board may
21increase the default percentage amount of compensation
22deferred into employee accounts.
23    An employee shall have 30 days from the start date of

 

 

SB1675- 2 -LRB102 14094 RPS 19446 b

1employment to elect to not participate in the deferred
2compensation plan or to elect to increase or reduce the amount
3of pre-tax gross compensation deferred. An employee shall be
4automatically enrolled in the Plan beginning the first day of
5the pay period following the employee's thirtieth day of
6employment. An employee who has been automatically enrolled in
7the Plan may elect, within 90 days of enrollment, to withdraw
8from the Plan and receive a refund of amounts deferred, plus or
9minus any applicable earnings, investment fees, and
10administrative fees. An employee making such an election shall
11forfeit all employer matching contributions, if any, made
12prior to the election. Any refunded amount shall be included
13in the employee's gross income for the taxable year in which
14the refund is issued.
15    As soon as practicable, the Board shall establish annual,
16automatic increases to employee contribution rates for
17employees who are automatically enrolled in the Plan pursuant
18to this Section. The amount of automatic annual increases in
19any 12-month period shall not exceed 1% of compensation.
20Employees may elect to not receive automatic annual increases
21in a manner described by the Board.
22(Source: P.A. 101-277, eff. 1-1-20.)
 
23    Section 99. Effective date. This Act takes effect July 1,
242021.