Full Text of SB2137 101st General Assembly
SB2137sam001 101ST GENERAL ASSEMBLY | Sen. Scott M. Bennett Filed: 3/15/2019
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| 1 | | AMENDMENT TO SENATE BILL 2137
| 2 | | AMENDMENT NO. ______. Amend Senate Bill 2137 by replacing | 3 | | everything after the enacting clause with the following:
| 4 | | "Section 5. The Illinois Prepaid Tuition Act is amended by | 5 | | changing Sections 30 and 35 as follows:
| 6 | | (110 ILCS 979/30)
| 7 | | Sec. 30. Investment Advisory Panel duties and | 8 | | responsibilities.
| 9 | | (a) Advice and review. The panel shall offer advice and | 10 | | counseling
regarding
the
investments of the Illinois prepaid | 11 | | tuition program with the objective of
obtaining the best | 12 | | possible return on investments consistent with actuarial
| 13 | | soundness of the
program. The panel is required to annually | 14 | | review and advise the Commission
on provisions of the strategic | 15 | | investment plan for the prepaid tuition program.
The panel is | 16 | | also charged with reviewing and advising the Commission with
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| 1 | | regard to the annual report that describes the current | 2 | | financial condition of
the program. The panel at its own | 3 | | discretion also may advise the Commission on
other aspects of | 4 | | the program.
| 5 | | (b) Investment plan. The Commission annually shall adopt
a | 6 | | comprehensive investment plan for purposes of this Section. The
| 7 | | comprehensive investment plan shall specify the investment | 8 | | policies to be
utilized by the Commission in its administration | 9 | | of the Illinois Prepaid
Tuition Trust
Fund created by Section | 10 | | 35. The Commission may direct that assets of those
Funds be | 11 | | placed in
savings accounts or may use the same to purchase | 12 | | fixed or variable life
insurance or annuity contracts, | 13 | | securities, evidence of indebtedness, or other
investment | 14 | | products pursuant to the comprehensive investment plan and in | 15 | | such
proportions as may be designated or approved under that | 16 | | plan.
The Commission shall invest such assets with the care, | 17 | | skill, prudence, and
diligence under the circumstances then | 18 | | prevailing that a prudent man acting in
a like capacity and | 19 | | familiar with such matters would use in the conduct of an
| 20 | | enterprise of a like character with like aims, and the | 21 | | Commission shall
diversify the investments of such assets so as | 22 | | to minimize the risk of large
losses, unless under the | 23 | | circumstances it is clearly prudent not to do so.
Those | 24 | | insurance,
annuity, savings, and investment products shall be | 25 | | underwritten and offered in
compliance with applicable federal | 26 | | and State laws, rules, and regulations
by persons who are |
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| 1 | | authorized thereunder to provide those services. The
| 2 | | Commission shall delegate responsibility for preparing the | 3 | | comprehensive
investment plan to the Executive Director of the | 4 | | Commission. Nothing in this
Section shall
preclude the | 5 | | Commission from contracting with a private corporation or
| 6 | | institution to provide such services as may be a part of the | 7 | | comprehensive
investment plan or as may be deemed necessary for | 8 | | implementation of the
comprehensive investment plan, | 9 | | including, but not limited to, providing
consolidated billing, | 10 | | individual and collective record keeping and accounting,
and | 11 | | asset purchase, control, and safekeeping.
| 12 | | (b-5) Investment duties. Beginning January 1, 2015, with | 13 | | respect to any investments for which it is responsible under | 14 | | this Section or any other law, the Commission shall be subject | 15 | | to the same requirements as are imposed upon the board of | 16 | | trustees of a
retirement system under subsections (5) and (9) | 17 | | of Section 1-109.1 of the Illinois Pension Code and Section | 18 | | Sections 1-109.1(5.1), 1-109.1(9), and 1-113.21 of the | 19 | | Illinois Pension Code, to the extent that those requirements | 20 | | are not in direct conflict with any other requirement of law to | 21 | | which the Commission is subject. | 22 | | (c) Program management. The Commission may not delegate its
| 23 | | management functions, but may arrange to compensate for | 24 | | personalized investment
advisory services rendered with | 25 | | respect to any or all of the investments under
its control an | 26 | | investment advisor registered under Section 8 of the Illinois
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| 1 | | Securities Law of 1953 or any bank or other entity authorized | 2 | | by law to provide
those services. Nothing contained herein | 3 | | shall preclude the Commission from
subscribing to general | 4 | | investment research services available for
purchase or use by | 5 | | others. The Commission also shall have authority to
compensate
| 6 | | for accounting, computing, and other necessary services.
| 7 | | (d) Annual report. The Commission shall annually prepare or | 8 | | cause to be
prepared a report setting forth in appropriate
| 9 | | detail an accounting of all Illinois prepaid tuition program | 10 | | funds and a
description of the financial condition of the | 11 | | program at the close of each
fiscal year. Included in this | 12 | | report shall be an evaluation by at least one
nationally | 13 | | recognized
actuary of the financial viability of the program. | 14 | | This report
shall be submitted to the Governor, the President | 15 | | of
the Senate, the Speaker of the House of Representatives, the | 16 | | Auditor General,
and the Board of Higher Education on or before | 17 | | March 1 of the subsequent fiscal
year. This report also shall | 18 | | be made available to purchasers of Illinois
prepaid tuition | 19 | | contracts and shall contain complete Illinois prepaid tuition
| 20 | | contract sales information,
including, but not limited to, | 21 | | projected postsecondary enrollment data for
qualified | 22 | | beneficiaries.
| 23 | | (e) Marketing plan. Selection of a marketing agent for the | 24 | | Illinois
prepaid tuition program must be approved by the | 25 | | Commission. At least once
every 3
years, the Commission shall | 26 | | solicit proposals
for marketing of the Illinois prepaid tuition |
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| 1 | | program in accordance with the
Illinois Securities Law of 1953 | 2 | | and any applicable provisions of federal law.
The entity | 3 | | designated pursuant to this paragraph shall serve as a | 4 | | centralized
marketing agent for the program and shall have | 5 | | exclusive responsibility for
marketing the program. No | 6 | | contract for marketing the Illinois prepaid tuition
program | 7 | | shall extend for longer than 3 years. Any materials produced | 8 | | for the
purpose of marketing the program shall be submitted to | 9 | | the Executive Director
of the Commission for approval before | 10 | | they are made public. Any eligible
institution may distribute | 11 | | marketing materials produced for the program, so
long as the | 12 | | Executive Director of the Commission approves the distribution | 13 | | in
advance. Neither
the State nor the Commission shall be | 14 | | liable for
misrepresentation of the program by a marketing | 15 | | agent.
| 16 | | (f) Accounting and audit. The Commission shall annually | 17 | | cause to be
prepared an accounting of the trust and shall | 18 | | transmit a copy of the accounting
to the Governor, the | 19 | | President of the Senate, the Speaker of the
House, and the | 20 | | minority leaders of the Senate and House of
Representatives. | 21 | | The Commission shall also make available this accounting of
the | 22 | | trust to any purchaser of an Illinois prepaid tuition contract, | 23 | | upon
request. The accounts of the Illinois prepaid tuition | 24 | | program shall be subject
to annual audits by the Auditor | 25 | | General or a certified public accountant
appointed by the | 26 | | Auditor General.
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| 1 | | (Source: P.A. 98-1022, eff. 1-1-15 .)
| 2 | | (110 ILCS 979/35)
| 3 | | Sec. 35. Illinois Prepaid Tuition Trust Fund.
| 4 | | (a) The Illinois Prepaid Tuition Trust Fund is created as | 5 | | the repository
of all moneys received by the Commission in | 6 | | conjunction with the Illinois
prepaid
tuition program. The | 7 | | Illinois Prepaid Tuition Trust Fund also shall be the
official | 8 | | repository of all contributions, appropriations, interest and | 9 | | dividend
payments, gifts, or other financial assets received by | 10 | | the Commission in
connection with operation of the Illinois | 11 | | prepaid tuition program. All such
moneys shall be deposited in | 12 | | the Illinois Prepaid Tuition Trust Fund
and held by the State | 13 | | Treasurer as ex-officio custodian thereof, outside of the
State | 14 | | Treasury, separate and apart from all public moneys or funds of | 15 | | this
State.
| 16 | | All interest or other earnings accruing or received on | 17 | | amounts in the
Illinois Prepaid
Tuition Trust Fund shall be | 18 | | credited to and retained by the Fund. Moneys,
interest, or | 19 | | other earnings paid into the Fund shall not be transferred or
| 20 | | allocated by the Commission, the State Treasurer, or the State
| 21 | | Comptroller
to any other fund, nor shall the Governor authorize | 22 | | any such transfer or
allocation,
while any contracts are | 23 | | outstanding. The State Comptroller shall not offset
moneys paid | 24 | | to institutions from the Illinois Prepaid Tuition Trust Fund
| 25 | | (unless the Trust Fund
moneys are used for child support).
In
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| 1 | | addition, no
moneys,
interest, or
other earnings paid into the | 2 | | Fund shall be used, temporarily or otherwise, for
interfund | 3 | | borrowing or be
otherwise used or appropriated except as | 4 | | expressly authorized in this Act.
| 5 | | The Illinois Prepaid Tuition Trust Fund and each individual | 6 | | participant
account that
may be created in that Fund in | 7 | | conjunction with the Illinois prepaid tuition
program shall be | 8 | | subject to audit in the same manner as funds and accounts
| 9 | | belonging to
the State of Illinois and shall be protected by | 10 | | the official bond given by the
State Treasurer.
| 11 | | (b) The Commission from time to time shall direct the State | 12 | | Treasurer to
invest moneys in the Illinois Prepaid Tuition | 13 | | Trust Fund that are not needed
for immediate disbursement, in | 14 | | accordance with provisions of the investment
plan approved by | 15 | | the Commission.
| 16 | | (c) The Executive Director of the Commission shall, at such | 17 | | times and in
such amounts as shall
be necessary, prepare and | 18 | | send to the State Comptroller vouchers requesting
payment from | 19 | | the Illinois Prepaid Tuition Trust Fund for: (i) registration | 20 | | fee
payments to eligible institutions on behalf of qualified | 21 | | beneficiaries of
Illinois
prepaid tuition contracts, and (ii) | 22 | | payments associated with administration of
the Illinois | 23 | | prepaid tuition program.
| 24 | | (d) The Governor shall indicate in a separate document | 25 | | submitted concurrent
with each annual State budget the | 26 | | estimated
amount of moneys in the Illinois Prepaid Tuition |
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| 1 | | Trust Fund which shall be
necessary and sufficient, during that | 2 | | State fiscal year, to discharge all
obligations anticipated | 3 | | under Illinois prepaid tuition contracts. The Governor
also | 4 | | shall indicate in a separate document submitted concurrent with | 5 | | each
annual State budget the amount of moneys from the
Illinois | 6 | | Prepaid Tuition Trust Fund necessary to cover anticipated | 7 | | expenses
associated with administration of the program.
The | 8 | | Commission shall obtain concurrence from a nationally | 9 | | recognized actuary
as to all amounts necessary for the program | 10 | | to meet its obligations. These
amounts shall be certified | 11 | | annually to the Governor by the Commission no later
than | 12 | | January 30.
| 13 | | During the first 18 months of operation of the Illinois | 14 | | prepaid tuition
program,
the Governor shall request an | 15 | | appropriation to the Commission from general
funds sufficient | 16 | | to pay for start-up costs associated with establishment of the
| 17 | | program.
This appropriation constitutes a loan that shall be | 18 | | repaid to the General
Revenue Fund within 5 years by the | 19 | | Commission from prepaid tuition program
contributions.
| 20 | | Subsequent program administrative costs shall be provided from
| 21 | | reasonable fees and charges equitably assessed to purchasers of | 22 | | prepaid tuition
contracts.
| 23 | | (e) If the Commission determines that there are | 24 | | insufficient moneys in
the Illinois Prepaid Tuition Trust Fund | 25 | | to pay contractual obligations in the
next succeeding fiscal | 26 | | year, the Commission shall certify the amount necessary
to meet |
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| 1 | | these obligations to the Board of Higher Education, the | 2 | | Governor, the
President of the Senate, and the
Speaker of the | 3 | | House of
Representatives. The Governor shall submit the amount | 4 | | so certified to the
General Assembly as soon as practicable, | 5 | | but no later than the end of the
current State fiscal year.
| 6 | | (f) (Blank). In the event the Commission, with the | 7 | | concurrence of the
Governor, determines the program to be | 8 | | financially infeasible, the Commission
may discontinue, | 9 | | prospectively, the operation of the program. Any qualified
| 10 | | beneficiary who has been accepted by and is enrolled or will | 11 | | within 5 years
enroll at an eligible institution shall be | 12 | | entitled to
exercise the complete benefits specified in the | 13 | | Illinois prepaid tuition
contract. All other contract holders | 14 | | shall receive an appropriate refund of
all contributions and | 15 | | accrued interest up to the time that the program is
| 16 | | discontinued.
| 17 | | (g) If moneys in the Illinois Prepaid Tuition Trust Fund | 18 | | are insufficient to cover obligations under this Section, this | 19 | | subsection shall constitute an irrevocable and continuing | 20 | | appropriation from the General Revenue Fund to the Commission | 21 | | for the purposes of paying obligations in accordance with the | 22 | | provisions of this Section. The full faith and credit of the | 23 | | State of Illinois is pledged for the punctual payment of such | 24 | | obligations. | 25 | | (Source: P.A. 96-1282, eff. 7-26-10.)".
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