97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
SB2486

 

Introduced 5/30/2011, by Sen. Larry K. Bomke

 

SYNOPSIS AS INTRODUCED:
 
15 ILCS 505/16.5
105 ILCS 5/21-25  from Ch. 122, par. 21-25
110 ILCS 947/67 rep.
110 ILCS 947/75
110 ILCS 979/45

    If and only if Senate Bill 2185 of the 97th General Assembly becomes law in the form in which it passed the Senate, amends the State Treasurer Act, the School Code, the Higher Education Student Assistance Act, and the Illinois Prepaid Tuition Act by deleting or repealing all language added by Senate Bill 2185 and restoring all language deleted by Senate Bill 2185. (Senate Bill 2185, as it passed the Senate, contained provisions amending the State Treasurer Act, the School Code, the Higher Education Student Assistance Act, and the Illinois Prepaid Tuition Act in relation to: the State Treasurer's College Savings Pool; school service personnel certificates; establishment of an Illinois DREAM Fund and Illinois DREAM Fund Commission; college savings programs; college savings instruments; and other matters.) Effective immediately.


LRB097 12201 NHT 56489 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB2486LRB097 12201 NHT 56489 b

1    AN ACT concerning education.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. If and only if Senate Bill 2185 of the 97th
5General Assembly becomes law in the form in which it passed the
6Senate, then the State Treasurer Act is amended by changing
7Section 16.5 as follows:
 
8    (15 ILCS 505/16.5)
9    Sec. 16.5. College Savings Pool. The State Treasurer may
10establish and administer a College Savings Pool to supplement
11and enhance the investment opportunities otherwise available
12to persons seeking to finance the costs of higher education.
13The State Treasurer, in administering the College Savings Pool,
14may receive moneys paid into the pool by a participant and may
15serve as the fiscal agent of that participant for the purpose
16of holding and investing those moneys.
17    "Participant", as used in this Section, means any person
18who has authority to withdraw funds, change the designated
19beneficiary, or otherwise exercise control over an account.
20"Donor", as used in this Section, means any person who makes
21investments in the pool. "Designated beneficiary", as used in
22this Section, means any person on whose behalf an account is
23established in the College Savings Pool by a participant. Both

 

 

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1in-state and out-of-state persons may be participants, donors,
2and designated beneficiaries in the College Savings Pool. The
3College Savings Pool must be available to any individual with a
4valid social security number or taxpayer identification number
5for the benefit of any individual with a valid social security
6number or taxpayer identification number, unless a contract in
7effect on the effective date of this amendatory Act of the 97th
8General Assembly does not allow for taxpayer identification
9numbers, in which case taxpayer identification numbers must be
10allowed upon the expiration of the contract.
11    New accounts in the College Savings Pool may be processed
12through participating financial institutions. "Participating
13financial institution", as used in this Section, means any
14financial institution insured by the Federal Deposit Insurance
15Corporation and lawfully doing business in the State of
16Illinois and any credit union approved by the State Treasurer
17and lawfully doing business in the State of Illinois that
18agrees to process new accounts in the College Savings Pool.
19Participating financial institutions may charge a processing
20fee to participants to open an account in the pool that shall
21not exceed $30 until the year 2001. Beginning in 2001 and every
22year thereafter, the maximum fee limit shall be adjusted by the
23Treasurer based on the Consumer Price Index for the North
24Central Region as published by the United States Department of
25Labor, Bureau of Labor Statistics for the immediately preceding
26calendar year. Every contribution received by a financial

 

 

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1institution for investment in the College Savings Pool shall be
2transferred from the financial institution to a location
3selected by the State Treasurer within one business day
4following the day that the funds must be made available in
5accordance with federal law. All communications from the State
6Treasurer to participants and donors shall reference the
7participating financial institution at which the account was
8processed.
9    The Treasurer may invest the moneys in the College Savings
10Pool in the same manner and in the same types of investments
11provided for the investment of moneys by the Illinois State
12Board of Investment. To enhance the safety and liquidity of the
13College Savings Pool, to ensure the diversification of the
14investment portfolio of the pool, and in an effort to keep
15investment dollars in the State of Illinois, the State
16Treasurer may make a percentage of each account available for
17investment in participating financial institutions doing
18business in the State. The State Treasurer may deposit with the
19participating financial institution at which the account was
20processed the following percentage of each account at a
21prevailing rate offered by the institution, provided that the
22deposit is federally insured or fully collateralized and the
23institution accepts the deposit: 10% of the total amount of
24each account for which the current age of the beneficiary is
25less than 7 years of age, 20% of the total amount of each
26account for which the beneficiary is at least 7 years of age

 

 

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1and less than 12 years of age, and 50% of the total amount of
2each account for which the current age of the beneficiary is at
3least 12 years of age. The Treasurer shall develop, publish,
4and implement an investment policy covering the investment of
5the moneys in the College Savings Pool. The policy shall be
6published (i) at least once each year in at least one newspaper
7of general circulation in both Springfield and Chicago and (ii)
8each year as part of the audit of the College Savings Pool by
9the Auditor General, which shall be distributed to all
10participants. The Treasurer shall notify all participants in
11writing, and the Treasurer shall publish in a newspaper of
12general circulation in both Chicago and Springfield, any
13changes to the previously published investment policy at least
1430 calendar days before implementing the policy. Any investment
15policy adopted by the Treasurer shall be reviewed and updated
16if necessary within 90 days following the date that the State
17Treasurer takes office.
18    Participants shall be required to use moneys distributed
19from the College Savings Pool for qualified expenses at
20eligible educational institutions. "Qualified expenses", as
21used in this Section, means the following: (i) tuition, fees,
22and the costs of books, supplies, and equipment required for
23enrollment or attendance at an eligible educational
24institution and (ii) certain room and board expenses incurred
25while attending an eligible educational institution at least
26half-time. "Eligible educational institutions", as used in

 

 

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1this Section, means public and private colleges, junior
2colleges, graduate schools, and certain vocational
3institutions that are described in Section 481 of the Higher
4Education Act of 1965 (20 U.S.C. 1088) and that are eligible to
5participate in Department of Education student aid programs. A
6student shall be considered to be enrolled at least half-time
7if the student is enrolled for at least half the full-time
8academic work load for the course of study the student is
9pursuing as determined under the standards of the institution
10at which the student is enrolled. Distributions made from the
11pool for qualified expenses shall be made directly to the
12eligible educational institution, directly to a vendor, or in
13the form of a check payable to both the beneficiary and the
14institution or vendor. Any moneys that are distributed in any
15other manner or that are used for expenses other than qualified
16expenses at an eligible educational institution shall be
17subject to a penalty of 10% of the earnings unless the
18beneficiary dies, becomes disabled, or receives a scholarship
19that equals or exceeds the distribution. Penalties shall be
20withheld at the time the distribution is made.
21    The Treasurer shall limit the contributions that may be
22made on behalf of a designated beneficiary based on the
23limitations established by the Internal Revenue Service. The
24contributions made on behalf of a beneficiary who is also a
25beneficiary under the Illinois Prepaid Tuition Program shall be
26further restricted to ensure that the contributions in both

 

 

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1programs combined do not exceed the limit established for the
2College Savings Pool. The Treasurer shall provide the Illinois
3Student Assistance Commission each year at a time designated by
4the Commission, an electronic report of all participant
5accounts in the Treasurer's College Savings Pool, listing total
6contributions and disbursements from each individual account
7during the previous calendar year. As soon thereafter as is
8possible following receipt of the Treasurer's report, the
9Illinois Student Assistance Commission shall, in turn, provide
10the Treasurer with an electronic report listing those College
11Savings Pool participants who also participate in the State's
12prepaid tuition program, administered by the Commission. The
13Commission shall be responsible for filing any combined tax
14reports regarding State qualified savings programs required by
15the United States Internal Revenue Service. The Treasurer shall
16work with the Illinois Student Assistance Commission to
17coordinate the marketing of the College Savings Pool and the
18Illinois Prepaid Tuition Program when considered beneficial by
19the Treasurer and the Director of the Illinois Student
20Assistance Commission. The Treasurer's office shall not
21publicize or otherwise market the College Savings Pool or
22accept any moneys into the College Savings Pool prior to March
231, 2000. The Treasurer shall provide a separate accounting for
24each designated beneficiary to each participant, the Illinois
25Student Assistance Commission, and the participating financial
26institution at which the account was processed. No interest in

 

 

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1the program may be pledged as security for a loan. Moneys held
2in an account invested in the Illinois College Savings Pool
3shall be exempt from all claims of the creditors of the
4participant, donor, or designated beneficiary of that account,
5except for the non-exempt College Savings Pool transfers to or
6from the account as defined under subsection (j) of Section
712-1001 of the Code of Civil Procedure (735 ILCS 5/12-1001(j)).
8    The assets of the College Savings Pool and its income and
9operation shall be exempt from all taxation by the State of
10Illinois and any of its subdivisions. The accrued earnings on
11investments in the Pool once disbursed on behalf of a
12designated beneficiary shall be similarly exempt from all
13taxation by the State of Illinois and its subdivisions, so long
14as they are used for qualified expenses. Contributions to a
15College Savings Pool account during the taxable year may be
16deducted from adjusted gross income as provided in Section 203
17of the Illinois Income Tax Act. The provisions of this
18paragraph are exempt from Section 250 of the Illinois Income
19Tax Act.
20    The Treasurer shall adopt rules he or she considers
21necessary for the efficient administration of the College
22Savings Pool. The rules shall provide whatever additional
23parameters and restrictions are necessary to ensure that the
24College Savings Pool meets all of the requirements for a
25qualified state tuition program under Section 529 of the
26Internal Revenue Code (26 U.S.C. 529). The rules shall provide

 

 

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1for the administration expenses of the pool to be paid from its
2earnings and for the investment earnings in excess of the
3expenses and all moneys collected as penalties to be credited
4or paid monthly to the several participants in the pool in a
5manner which equitably reflects the differing amounts of their
6respective investments in the pool and the differing periods of
7time for which those amounts were in the custody of the pool.
8Also, the rules shall require the maintenance of records that
9enable the Treasurer's office to produce a report for each
10account in the pool at least annually that documents the
11account balance and investment earnings. Notice of any proposed
12amendments to the rules and regulations shall be provided to
13all participants prior to adoption. Amendments to rules and
14regulations shall apply only to contributions made after the
15adoption of the amendment.
16    Upon creating the College Savings Pool, the State Treasurer
17shall give bond with 2 or more sufficient sureties, payable to
18and for the benefit of the participants in the College Savings
19Pool, in the penal sum of $1,000,000, conditioned upon the
20faithful discharge of his or her duties in relation to the
21College Savings Pool.
22(Source: P.A. 95-23, eff. 8-3-07; 95-306, eff. 1-1-08; 95-521,
23eff. 8-28-07; 95-876, eff. 8-21-08; 09700SB2185eng.)
 
24    Section 3. If and only if Senate Bill 2185 of the 97th
25General Assembly becomes law in the form in which it passed the

 

 

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1Senate, then the School Code is amended by changing Section
221-25 as follows:
 
3    (105 ILCS 5/21-25)  (from Ch. 122, par. 21-25)
4    Sec. 21-25. School service personnel certificate.
5    (a) For purposes of this Section, "school service
6personnel" means persons employed and performing appropriate
7services in an Illinois public or State-operated elementary
8school, secondary school, or cooperative or joint agreement
9with a governing body or board of control or a charter school
10operating in compliance with the Charter Schools Law in a
11position requiring a school service personnel certificate.
12    Subject to the provisions of Section 21-1a, a school
13service personnel certificate shall be issued to those
14applicants of good character, good health, a citizen of the
15United States and at least 19 years of age who have a
16Bachelor's degree with not fewer than 120 semester hours from a
17regionally accredited institution of higher learning and who
18meets the requirements established by the State Superintendent
19of Education in consultation with the State Teacher
20Certification Board. A school service personnel certificate
21with a school nurse endorsement may be issued to a person who
22holds a bachelor of science degree from an institution of
23higher learning accredited by the North Central Association or
24other comparable regional accrediting association. Persons
25seeking any other endorsement on the school service personnel

 

 

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1certificate shall be recommended for the endorsement by a
2recognized teacher education institution as having completed a
3program of preparation approved by the State Superintendent of
4Education in consultation with the State Teacher Certification
5Board.
6    (b) Until August 30, 2002, a school service personnel
7certificate endorsed for school social work may be issued to a
8student who has completed a school social work program that has
9not been approved by the State Superintendent of Education,
10provided that each of the following conditions is met:
11        (1) The program was offered by a recognized, public
12    teacher education institution that first enrolled students
13    in its master's degree program in social work in 1998;
14        (2) The student applying for the school service
15    personnel certificate was enrolled in the institution's
16    master's degree program in social work on or after May 11,
17    1998;
18        (3) The State Superintendent verifies that the student
19    has completed coursework that is substantially similar to
20    that required in approved school social work programs,
21    including (i) not fewer than 600 clock hours of a
22    supervised internship in a school setting or (ii) if the
23    student has completed part of a supervised internship in a
24    school setting prior to the effective date of this
25    amendatory Act of the 92nd General Assembly and receives
26    the prior approval of the State Superintendent, not fewer

 

 

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1    than 300 additional clock hours of supervised work in a
2    public school setting under the supervision of a certified
3    school social worker who certifies that the supervised work
4    was completed in a satisfactory manner; and
5        (4) The student has passed a test of basic skills and
6    the test of subject matter knowledge required by Section
7    21-1a.
8    This subsection (b) does not apply after August 29, 2002.
9    (c) A school service personnel certificate shall be
10endorsed with the area of Service as determined by the State
11Superintendent of Education in consultation with the State
12Teacher Certification Board.
13    The holder of such certificate shall be entitled to all of
14the rights and privileges granted holders of a valid teaching
15certificate, including teacher benefits, compensation and
16working conditions.
17    When the holder of such certificate has earned a master's
18degree, including 8 semester hours of graduate professional
19education from a recognized institution of higher learning, and
20has at least 2 years of successful school experience while
21holding such certificate, the certificate may be endorsed for
22supervision.
23    (d) Persons who have successfully achieved National Board
24certification through the National Board for Professional
25Teaching Standards shall be issued a Master School Service
26Personnel Certificate, valid for 10 years and renewable

 

 

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1thereafter every 10 years through compliance with requirements
2set forth by the State Board of Education, in consultation with
3the State Teacher Certification Board. However, each holder of
4a Master School Service Personnel Certificate shall be eligible
5for a corresponding position in this State in the areas for
6which he or she holds a Master Certificate without satisfying
7any other requirements of this Code, except for those
8requirements pertaining to criminal background checks.
9    (e) School service personnel certificates are renewable
10every 5 years and may be renewed as provided in this Section.
11Requests for renewals must be submitted, in a format prescribed
12by the State Board of Education, to the regional office of
13education responsible for the school where the holder is
14employed.
15    Upon completion of at least 80 hours of continuing
16professional development as provided in this subsection (e), a
17person who holds a valid school service personnel certificate
18shall have his or her certificate renewed for a period of 5
19years. A person who (i) holds an active license issued by the
20State as a clinical professional counselor, a professional
21counselor, a clinical social worker, a social worker, or a
22speech-language pathologist; (ii) holds national certification
23as a Nationally Certified School Psychologist from the National
24School Psychology Certification Board; (iii) is nationally
25certified as a National Certified School Nurse from the
26National Board for Certification of School Nurses; (iv) is

 

 

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1nationally certified as a National Certified Counselor or
2National Certified School Counselor from the National Board for
3Certified Counselors; or (v) holds a Certificate of Clinical
4Competence from the American Speech-Language-Hearing
5Association shall be deemed to have satisfied the continuing
6professional development requirements established by the State
7Board of Education and the State Teacher Certification Board to
8renew a school service personnel certificate.
9    School service personnel certificates may be renewed by the
10State Teacher Certification Board based upon proof of
11continuing professional development. The State Board of
12Education shall (i) establish a procedure for renewing school
13service personnel certificates, which shall include without
14limitation annual timelines for the renewal process and the
15components set forth in this Section; (ii) approve or
16disapprove the providers of continuing professional
17development activities; and (iii) provide, on a timely basis to
18all school service personnel certificate holders, regional
19superintendents of schools, school districts, and others with
20an interest in continuing professional development,
21information about the standards and requirements established
22pursuant to this subsection (e).
23    Any school service personnel certificate held by an
24individual employed and performing services in an Illinois
25public or State-operated elementary school, secondary school,
26or cooperative or joint agreement with a governing body or

 

 

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1board of control in a certificated school service personnel
2position or in a charter school in compliance with the Charter
3Schools Law must be maintained Valid and Active through
4certificate renewal activities specified in the certificate
5renewal procedure established pursuant to this Section,
6provided that a holder of a Valid and Active certificate who is
7only employed on either a part-time basis or day-to-day basis
8as a substitute shall pay only the required registration fee to
9renew his or her certificate and maintain it as Valid and
10Active. All other school service personnel certificates held
11may be maintained as Valid and Exempt through the registration
12process provided for in the certificate renewal procedure
13established pursuant to Section 21-14 of this Code. A Valid and
14Exempt certificate must be immediately activated, through
15procedures developed by the State Board of Education upon the
16certificate holder becoming employed and performing services
17in an Illinois public or State-operated elementary school,
18secondary school, or cooperative or joint agreement with a
19governing body or board of control in a certificated school
20service personnel position or in a charter school operating in
21compliance with the Charter Schools Law. A holder of a Valid
22and Exempt certificate may activate his or her certificate
23through procedures provided for in the certificate renewal
24procedure established pursuant to this Section.
25    A school service personnel certificate that has been
26maintained as Valid and Active for the 5 years of the

 

 

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1certificate's validity shall be renewed as Valid and Active
2upon the certificate holder (i) completing the National Board
3for Professional Teaching Standards process in an area of
4concentration comparable to the holder's school service
5personnel certificate of endorsement or (ii) earning 80
6continuing professional development units as described in this
7Section. If, however, the certificate holder has maintained the
8certificate as Valid and Exempt for a portion of the 5-year
9period of validity, the number of continuing professional
10development units needed to renew the certificate as Valid and
11Active must be proportionately reduced by the amount of time
12the certificate was Valid and Exempt. If a certificate holder
13is employed and performs services requiring the holder's school
14service personnel certificate on a part-time basis for all or a
15portion of the certificate's 5-year period of validity, the
16number of continuing professional development units needed to
17renew the certificate as Valid and Active shall be reduced by
1850% for the amount of time the certificate holder has been
19employed and performing such services on a part-time basis.
20"Part-time" means less than 50% of the school day or school
21term.
22    Beginning July 1, 2008, in order to satisfy the
23requirements for continuing professional development provided
24for in this Section, each Valid and Active school service
25personnel certificate holder shall complete professional
26development activities that address the certificate or those

 

 

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1certificates that are required of his or her certificated
2position, if the certificate holder is employed and performing
3services in an Illinois public or State operated elementary
4school, secondary school, or cooperative or joint agreement
5with a governing body or board of control, or that certificate
6or those certificates most closely related to his or her
7teaching position, if the certificate holder is employed in a
8charter school. Except as otherwise provided in this subsection
9(e), the certificate holder's activities must address and must
10reflect the following continuing professional development
11purposes:
12        (1) Advance both the certificate holder's knowledge
13    and skills consistent with the Illinois Standards for the
14    service area in which the certificate is endorsed in order
15    to keep the certificate holder current in that area.
16        (2) Develop the certificate holder's knowledge and
17    skills in areas determined by the State Board of Education
18    to be critical for all school service personnel.
19        (3) Address the knowledge, skills, and goals of the
20    certificate holder's local school improvement plan, if the
21    certificate holder is employed in an Illinois public or
22    State-operated elementary school, secondary school, or
23    cooperative or joint agreement with a governing body or
24    board of control.
25        (4) Address the needs of serving students with
26    disabilities, including adapting and modifying clinical or

 

 

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1    professional practices to meet the needs of students with
2    disabilities and serving such students in the least
3    restrictive environment.
4        (5) Address the needs of serving students who are the
5    children of immigrants, including, if the certificate
6    holder is employed as a counselor in an Illinois public or
7    State-operated secondary school, opportunities for higher
8    education for students who are undocumented immigrants.
9    The coursework or continuing professional development
10units ("CPDU") required under this subsection (e) must total 80
11CPDUs or the equivalent and must address 4 3 of the 5 4
12purposes described in items (1) through (5) (4) of this
13subsection (e). Holders of school service personnel
14certificates may fulfill this obligation with any combination
15of semester hours or CPDUs as follows:
16        (A) Collaboration and partnership activities related
17    to improving the school service personnel certificate
18    holder's knowledge and skills, including (i) participating
19    on collaborative planning and professional improvement
20    teams and committees; (ii) peer review and coaching; (iii)
21    mentoring in a formal mentoring program, including service
22    as a consulting teacher participating in a remediation
23    process formulated under Section 24A-5 of this Code; (iv)
24    participating in site-based management or decision-making
25    teams, relevant committees, boards, or task forces
26    directly related to school improvement plans; (v)

 

 

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1    coordinating community resources in schools, if the
2    project is a specific goal of the school improvement plan;
3    (vi) facilitating parent education programs for a school,
4    school district, or regional office of education directly
5    related to student achievement or school improvement
6    plans; (vii) participating in business, school, or
7    community partnerships directly related to student
8    achievement or school improvement plans; or (viii)
9    supervising a student teacher (student services personnel)
10    or teacher education candidate in clinical supervision,
11    provided that the supervision may be counted only once
12    during the course of 5 years.
13        (B) Coursework from a regionally accredited
14    institution of higher learning related to one of the
15    purposes listed in items (1) through (4) of this subsection
16    (e), which shall apply at the rate of 15 continuing
17    professional development units per semester hour of credit
18    earned during the previous 5-year period when the status of
19    the holder's school service personnel certificate was
20    Valid and Active. Proportionate reductions shall apply
21    when the holder's status was Valid and Active for less than
22    the 5-year period preceding the renewal.
23        (C) Teaching college or university courses in areas
24    relevant to the certificate area being renewed, provided
25    that the teaching may be counted only once during the
26    course of 5 years.

 

 

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1        (D) Conferences, workshops, institutes, seminars, or
2    symposiums designed to improve the certificate holder's
3    knowledge and skills in the service area and applicable to
4    the purposes listed in items (1) through (5) (4) of this
5    subsection (e). One CPDU shall be awarded for each hour of
6    attendance. No one shall receive credit for conferences,
7    workshops, institutes, seminars, or symposiums that are
8    designed for entertainment, promotional, or commercial
9    purposes or that are solely inspirational or motivational.
10    The State Superintendent of Education and regional
11    superintendents of schools are authorized to review the
12    activities and events provided or to be provided under this
13    subdivision (D) and to investigate complaints regarding
14    those activities and events. Either the State
15    Superintendent of Education or a regional superintendent
16    of schools may recommend that the State Board of Education
17    disapprove those activities and events considered to be
18    inconsistent with this subdivision (D).
19        (E) Completing non-university credit directly related
20    to student achievement, school improvement plans, or State
21    priorities.
22        (F) Participating in or presenting at workshops,
23    seminars, conferences, institutes, or symposiums.
24        (G) Training as external reviewers for quality
25    assurance.
26        (H) Training as reviewers of university teacher

 

 

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1    preparation programs.
2        (I) Other educational experiences related to improving
3    the school service personnel's knowledge and skills as a
4    teacher, including (i) participating in action research
5    and inquiry projects; (ii) traveling related to one's
6    assignment and directly related to school service
7    personnel achievement or school improvement plans and
8    approved by the regional superintendent of schools or his
9    or her designee at least 30 days prior to the travel
10    experience, provided that the traveling shall not include
11    time spent commuting to destinations where the learning
12    experience will occur; (iii) participating in study groups
13    related to student achievement or school improvement
14    plans; (iv) serving on a statewide education-related
15    committee, including without limitation the State Teacher
16    Certification Board, State Board of Education strategic
17    agenda teams, or the State Advisory Council on Education of
18    Children with Disabilities; (v) participating in
19    work/learn programs or internships; or (vi) developing a
20    portfolio of student and teacher work.
21        (J) Professional leadership experiences related to
22    improving the teacher's knowledge and skills as a teacher,
23    including (i) participating in curriculum development or
24    assessment activities at the school, school district,
25    regional office of education, State, or national level;
26    (ii) participating in team or department leadership in a

 

 

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1    school or school district; (iii) participating on external
2    or internal school or school district review teams; (iv)
3    publishing educational articles, columns, or books
4    relevant to the certificate area being renewed; or (v)
5    participating in non-strike-related professional
6    association or labor organization service or activities
7    related to professional development.
8(Source: P.A. 94-105, eff. 7-1-05; 95-592, eff. 7-1-08;
909700SB2185eng.)
 
10    (110 ILCS 947/67 rep.)
11    Section 4. If and only if Senate Bill 2185 of the 97th
12General Assembly becomes law in the form in which it passed the
13Senate, then the Higher Education Student Assistance Act is
14amended by repealing Section 67.
 
15    Section 5. If and only if Senate Bill 2185 of the 97th
16General Assembly becomes law in the form in which it passed the
17Senate, then the Higher Education Student Assistance Act is
18amended by changing Section 75 as follows:
 
19    (110 ILCS 947/75)
20    Sec. 75. College savings programs.
21    (a) Purpose. The General Assembly finds and hereby declares
22that for the benefit of the people of the State of Illinois,
23the conduct and increase of their commerce, the protection and

 

 

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1enhancement of their welfare, the development of continued
2prosperity and the improvement of their health and living
3conditions, it is essential that all citizens with the
4intellectual ability and motivation be able to obtain a higher
5education. The General Assembly further finds that rising
6tuition costs, increasingly restrictive eligibility criteria
7for existing federal and State student aid programs and other
8trends in higher education finance have impeded access to a
9higher education for many middle-income families; and that to
10remedy these concerns, it is of utmost importance that families
11be provided with investment alternatives to enhance their
12financial access to institutions of higher education. It is the
13intent of this Section to establish College Savings Programs
14appropriate for families from various income groups, to
15encourage Illinois families to save and invest in anticipation
16of their children's education, and to encourage enrollment in
17institutions of higher education, all in execution of the
18public policy set forth above and elsewhere in this Act.
19College Savings Programs established under this Section must be
20available to any individual with a valid social security number
21or taxpayer identification number for the benefit of any
22individual with a valid social security number or taxpayer
23identification number.
24    (b) The Commission is authorized to develop and provide a
25program of college savings instruments to qualifying Illinois
26residents citizens. The program shall be structured to

 

 

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1encourage parents to plan ahead for the college education of
2their children and to permit the long-term accumulation of
3savings which can be used to finance the family's share of the
4cost of a higher education. Income, up to $2,000 annually per
5account, which is derived by individuals from investments made
6in accordance with College Savings Programs established under
7this Section shall be free from all taxation by the State and
8its political subdivisions, except for estate, transfer, and
9inheritance taxes.
10    (c) The Commission is authorized to contract with private
11financial institutions and other businesses, individuals, and
12other appropriate parties to establish and operate the College
13Savings Programs. The Commission may negotiate contracts with
14private financial and investment companies, establish College
15Savings Programs, and monitor the vendors administering the
16programs in whichever manner the Commission determines is best
17suited to accomplish the purposes of this Section. The Auditor
18General shall periodically review the operation of the College
19Savings Programs and shall advise the Commission and the
20General Assembly of his findings.
21    (d) In determining the type of instruments to be offered,
22the Commission shall consult with, and receive the assistance
23of, the Illinois Board of Higher Education, the Governor's
24Office of Management and Budget, the State Board of
25Investments, the Governor, and other appropriate State
26agencies and private parties.

 

 

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1    (e) The Commission shall market and promote the College
2Savings Programs to the citizens of Illinois.
3    (f) The Commission shall assist the State Comptroller and
4State Treasurer in establishing a payroll deduction plan
5through which State employees may participate in the College
6Savings Programs. The Department of Labor, Department of
7Employment Security, Department of Revenue, and other
8appropriate agencies shall assist the Commission in educating
9Illinois employers about the College Savings Programs, and
10shall assist the Commission in securing employers'
11participation in a payroll deduction plan and other initiatives
12which maximize participation in the College Savings Programs.
13    (g) The Commission shall examine means by which the State,
14through a series of matching contributions or other incentives,
15may most effectively encourage Illinois families to
16participate in the College Savings Programs. The Commission
17shall report its conclusions and recommendations to the
18Governor and General Assembly no later than February 15, 1990.
19    (h) The College Savings Programs established pursuant to
20this Section shall not be subject to the provisions of the
21Illinois Administrative Procedure Act. The Commission shall
22provide that appropriate disclosures are provided to all
23citizens who participate in the College Savings Programs.
24(Source: P.A. 94-793, eff. 5-19-06; 09700SB2185eng.)
 
25    Section 10. If and only if Senate Bill 2185 of the 97th

 

 

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1General Assembly becomes law in the form in which it passed the
2Senate, then the Illinois Prepaid Tuition Act is amended by
3changing Section 45 as follows:
 
4    (110 ILCS 979/45)
5    Sec. 45. Illinois prepaid tuition contracts.
6    (a) The Commission may enter into an Illinois prepaid
7tuition contract with a purchaser under which the Commission
8contracts on behalf of the State to pay full tuition and
9mandatory fees at an Illinois public university or Illinois
10community college for a qualified beneficiary to attend the
11eligible institution to which the qualified beneficiary is
12admitted. Each contract shall contain terms, conditions, and
13provisions that the Commission determines to be necessary for
14ensuring the educational objectives and sustainable financial
15viability of the Illinois prepaid tuition program.
16    (b) Each contract shall have one designated purchaser and
17one designated qualified beneficiary. Unless otherwise
18specified in the contract, the purchaser owns the contract and
19retains any tax liability for its assets only until the first
20distribution of benefits. Contracts shall be purchased in units
21of 15 credit hours.
22    (c) Without exception, benefits may be received by a
23qualified beneficiary of an Illinois prepaid tuition contract
24no earlier than 3 years from the date the contract is
25purchased.

 

 

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1    (d) A prepaid tuition contract shall contain, but is not
2limited to, provisions for (i) refunds or withdrawals in
3certain circumstances, with or without interest or penalties;
4(ii) conversion of the contract at the time of distribution
5from accrued prepayment value at one type of eligible
6institution to the accrued prepayment value at a different type
7of eligible institution; (iii) portability of the accrued value
8of the prepayment value for use at an eligible institution
9located outside this State; (iv) transferability of the
10contract benefits within the qualified beneficiary's immediate
11family; and (v) a specified benefit period during which the
12contract may be redeemed.
13    (e) Each Illinois prepaid tuition contract also shall
14contain, at minimum, all of the following:
15        (1) The amount of payment or payments and the number of
16    payments required from a purchaser on behalf of a qualified
17    beneficiary.
18        (2) The terms and conditions under which purchasers
19    shall remit payments, including, but not limited to, the
20    date or dates upon which each payment shall be due.
21        (3) Provisions for late payment charges and for
22    default.
23        (4) Provisions for penalty fees payable incident to an
24    authorized withdrawal.
25        (5) The name, date of birth, and social security number
26    or taxpayer identification number of the qualified

 

 

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1    beneficiary on whose behalf the contract is drawn and the
2    terms and conditions under which the contract may be
3    transferred to another qualified beneficiary.
4        (6) The name and social security number or taxpayer
5    identification number of any person who may terminate the
6    contract, together with terms that specify whether the
7    contract may be terminated by the purchaser, the qualified
8    beneficiary, a specific designated person, or any
9    combination of these persons.
10        (7) The terms and conditions under which a contract may
11    be terminated, the name and social security number or
12    taxpayer identification number of the person entitled to
13    any refund due as a result of the termination of the
14    contract pursuant to those terms and conditions, and the
15    method for determining the amount of a refund.
16        (8) The time limitations, if any, within which the
17    qualified beneficiary must claim his or her benefits
18    through the program.
19        (9) Other terms and conditions determined by the
20    Commission to be appropriate.
21    (f) In addition to the contract provisions set forth in
22subsection (e), each Illinois prepaid tuition contract shall
23include:
24        (1) The number of credit hours contracted by the
25    purchaser.
26        (2) The type of eligible institution and the prepaid

 

 

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1    tuition plan toward which the credit hours shall be
2    applied.
3        (3) The explicit contractual obligation of the
4    Commission to the qualified beneficiary to provide a
5    specific number of credit hours of undergraduate
6    instruction at an eligible institution, not to exceed the
7    maximum number of credit hours required for the conference
8    of a degree that corresponds to the plan purchased on
9    behalf of the qualified beneficiary.
10    (g) The Commission shall indicate by rule the conditions
11under which refunds are payable to a contract purchaser.
12Generally, no refund shall exceed the amount paid into the
13Illinois Prepaid Tuition Trust Fund by the purchaser. In the
14event that a contract is converted from a Public University
15Plan described in subsection (j) of this Section to a Community
16College Plan described in subsection (k) of this Section, the
17refund amount shall be reduced by the amount transferred to the
18Illinois community college on behalf of the qualified
19beneficiary. Except where the Commission may otherwise rule,
20refunds may exceed the amount paid into the Illinois Prepaid
21Tuition Trust Fund only under the following circumstances:
22        (1) If the qualified beneficiary is awarded a grant or
23    scholarship at a public institution of higher education,
24    the terms of which duplicate the benefits included in the
25    Illinois prepaid tuition contract, then moneys paid for the
26    purchase of the contract shall be returned to the

 

 

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1    purchaser, upon request, in semester installments that
2    coincide with the matriculation by the qualified
3    beneficiary, in an amount equal to the current cost of
4    tuition and mandatory fees at the public institution of
5    higher education where the qualified beneficiary is
6    enrolled.
7        (1.5) If the qualified beneficiary is awarded a grant
8    or scholarship while enrolled at either an eligible
9    nonpublic institution of higher education or an eligible
10    public or private out-of-state higher education
11    institution, the terms of which duplicate the benefits
12    included in the Illinois prepaid tuition contract, then
13    money paid for the purchase of the contract shall be
14    returned to the purchaser, upon request, in semester
15    installments that coincide with the matriculation by the
16    qualified beneficiary. The amount paid shall not exceed the
17    current average mean-weighted credit hour value of the
18    registration fees purchased under the contract.
19        (2) In the event of the death or total disability of
20    the qualified beneficiary, moneys paid for the purchase of
21    the Illinois prepaid tuition contract shall be returned to
22    the purchaser together with all accrued earnings.
23        (3) If an Illinois prepaid tuition contract is
24    converted from a Public University Plan to a Community
25    College Plan, then the amount refunded shall be the value
26    of the original Illinois prepaid tuition contract minus the

 

 

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1    value of the contract after conversion.
2    No refund shall be authorized under an Illinois prepaid
3tuition contract for any semester partially attended but not
4completed.
5    The Commission, by rule, shall set forth specific
6procedures for making contract payments in conjunction with
7grants and scholarships awarded to contract beneficiaries.
8    Moneys paid into or out of the Illinois Prepaid Tuition
9Trust Fund by or on behalf of the purchaser or the qualified
10beneficiary of an Illinois prepaid tuition contract are exempt
11from all claims of creditors of the purchaser or beneficiary,
12so long as the contract has not been terminated.
13    The State or any State agency, county, municipality, or
14other political subdivision, by contract or collective
15bargaining agreement, may agree with any employee to remit
16payments toward the purchase of Illinois prepaid tuition
17contracts through payroll deductions made by the appropriate
18officer or officers of the entity making the payments. Such
19payments shall be held and administered in accordance with this
20Act.
21    (h) Nothing in this Act shall be construed as a promise or
22guarantee that a qualified beneficiary will be admitted to an
23eligible institution or to a particular eligible institution,
24will be allowed to continue enrollment at an eligible
25institution after admission, or will be graduated from an
26eligible institution.

 

 

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1    (i) The Commission shall develop and make prepaid tuition
2contracts available under a minimum of at least 2 independent
3plans to be known as the Public University Plan and the
4Community College Plan.
5    Contracts shall be purchased in units of 15 credit hours at
6either an Illinois public university or an Illinois community
7college. The minimum purchase amount per qualified beneficiary
8shall be one unit or 15 credit hours. The maximum purchase
9amount shall be 9 units (or 135 credit hours) for the Public
10University Plan and 4 units (or 60 credit hours) for the
11Community College Plan.
12    (j) Public University Plan. Through the Public University
13Plan, the Illinois prepaid tuition contract shall provide
14prepaid registration fees, which include full tuition costs as
15well as mandatory fees, for a specified number of undergraduate
16credit hours, not to exceed the maximum number of credit hours
17required for the conference of a baccalaureate degree. In
18determining the cost of participation in the Public University
19Plan, the Commission shall reference the combined
20mean-weighted current registration fees from Illinois public
21universities.
22    In the event that a qualified beneficiary for whatever
23reason chooses to attend an Illinois community college, the
24qualified beneficiary may convert the average number of credit
25hours required for the conference of an associate degree from
26the Public University Plan to the Community College Plan and

 

 

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1may retain the remaining Public University Plan credit hours or
2may request a refund for prepaid credit hours in excess of
3those required for conference of an associate degree. In
4determining the amount of any refund, the Commission also shall
5recognize the current relative credit hour cost of the 2 plans
6when making any conversion.
7    Qualified beneficiaries shall bear the cost of any
8laboratory or other non-mandatory fees associated with
9enrollment in specific courses. Qualified beneficiaries who
10are not Illinois residents shall bear the difference in cost
11between in-state registration fees guaranteed by the prepaid
12tuition contract and tuition and other charges assessed upon
13out-of-state students by the eligible institution.
14    (k) Community College Plan. Through the Community College
15Plan, the Illinois prepaid tuition contract shall provide
16prepaid registration fees, which include full tuition costs as
17well as mandatory fees, for a specified number of undergraduate
18credit hours, not to exceed the maximum number of credit hours
19required for the conference of an associate degree. In
20determining the cost of participation in the Community College
21Plan, the Commission shall reference the combined
22mean-weighted current registration fees from all Illinois
23community colleges.
24    In the event that a qualified beneficiary for whatever
25reason chooses to attend an Illinois public university, the
26qualified beneficiary's prepaid tuition contract shall be

 

 

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1converted for use at that Illinois public university by
2referencing the current average mean-weighted credit hour
3value of registration fees at Illinois community colleges
4relative to the corresponding value of registration fees at
5Illinois public universities.
6    Qualified beneficiaries shall bear the cost of any
7laboratory or other non-mandatory fees associated with
8enrollment in specific courses. Qualified beneficiaries who
9are not Illinois residents shall bear the difference in cost
10between in-state registration fees guaranteed by the prepaid
11tuition contract and tuition and other charges assessed upon
12out-of-state students by the eligible institution.
13    (l) A qualified beneficiary may apply the benefits of any
14Illinois prepaid tuition contract toward a nonpublic
15institution of higher education. In the event that a qualified
16beneficiary for whatever reason chooses to attend a nonpublic
17institution of higher education, the qualified beneficiary's
18prepaid tuition contract shall be converted for use at that
19nonpublic institution of higher education by referencing the
20current average mean-weighted credit hour value of
21registration fees purchased under the contract. The Commission
22shall transfer, or cause to have transferred, this amount, less
23a transfer fee, to the nonpublic institution on behalf of the
24beneficiary. In the event that the cost of registration charged
25to the beneficiary at the nonpublic institution of higher
26education is less than the aggregate value of the Illinois

 

 

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1prepaid tuition contract, any remaining amount shall be
2transferred in subsequent semesters until the transfer value is
3fully depleted.
4    (m) A qualified beneficiary may apply the benefits of any
5Illinois prepaid tuition contract toward an eligible
6out-of-state college or university. Institutional eligibility
7for out-of-state colleges and universities shall be determined
8by the Commission according to standards substantially
9equivalent to those for an eligible institution located in this
10State, as described in the definition of "institution of higher
11learning" in Section 10 of the Higher Education Student
12Assistance Act. In the event that a qualified beneficiary for
13whatever reason chooses to attend an eligible out-of-state
14college or university, the qualified beneficiary's prepaid
15tuition contract shall be converted for use at that college or
16university by referencing the current average mean-weighted
17credit hour value of registration fees purchased under the
18contract. The Commission shall transfer, or cause to have
19transferred, this amount, less a transfer fee, to the college
20or university on behalf of the beneficiary. In the event that
21the cost of registration charged to the beneficiary at the
22eligible out-of-state college or university is less than the
23aggregate value of the Illinois prepaid tuition contract, any
24remaining amount shall be transferred in subsequent semesters
25until the transfer value is fully depleted.
26    (n) Illinois prepaid tuition contracts may be purchased

 

 

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1either by lump sum or by installments. No penalty shall be
2assessed for early payment of installment contracts.
3    (o) The Commission shall annually adjust the price of new
4contracts, in accordance with the annual changes in
5registration fees at Illinois public universities and
6community colleges.
7(Source: P.A. 95-217, eff. 8-16-07; 96-1282, eff. 7-26-10;
809700SB2185eng.)
 
9    Section 99. Effective date. This Act takes effect upon
10becoming law.