Full Text of HB1293 102nd General Assembly
HB1293enr 102ND GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning government.
| 2 | | Be it enacted by the People of the State of Illinois, | 3 | | represented in the General Assembly:
| 4 | | Article 1. | 5 | | Section 1-1. Findings. | 6 | | (a) The General Assembly finds that: | 7 | | (1) Russia launched an unprecedented military assault | 8 | | on Ukraine that has left many dead, and the fighting in | 9 | | Ukraine appears to be some of the worst conventional | 10 | | warfare Europe has seen since World War II and the | 11 | | conflicts in the Balkans in the 1990s; | 12 | | (2) Western leaders have been united in their swift | 13 | | and strong condemnation of Russia's military action; | 14 | | (3) President Biden has stated that Russian President | 15 | | Putin had "committed an assault on the very principles | 16 | | that uphold the global peace", and the United States has, | 17 | | as a result, taken steps to impose harsh, new sanctions | 18 | | that are intended to punish President Putin for his | 19 | | actions; | 20 | | (4) Secretary of State Blinken has indicated that | 21 | | there are credible reports that Russia has engaged in | 22 | | actions during its military assault on Ukraine that | 23 | | constitute war crimes under international law; |
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| 1 | | (5) Russia has used, during its military assault on | 2 | | Ukraine, weapons that have been banned by many countries, | 3 | | including cluster munitions; | 4 | | (6) Russia has conducted direct attacks on major | 5 | | nuclear power facilities in Ukraine, which could lead to | 6 | | disaster and the spread of radioactive contamination | 7 | | across Ukraine and Europe; | 8 | | (7) the United Nations has estimated that more than | 9 | | 14,000,000 Ukrainians have already been displaced within | 10 | | the country and more than 7,000,000 have left the country | 11 | | as a result of the Russian invasion; | 12 | | (8) the international community is making preparations | 13 | | to meet the humanitarian needs of those refugees who are | 14 | | displaced by this conflict; | 15 | | (9) Central Europe is welcoming Ukrainians, but the | 16 | | countries in that region are not currently equipped to | 17 | | handle the volume of refugees that are anticipated to | 18 | | arrive at their borders in the coming weeks, and European | 19 | | and U.S. leadership must help build that capacity; and | 20 | | (10) Illinois is a welcoming state to refugees and | 21 | | immigrants and home to a robust community of Ukrainian | 22 | | immigrants and Ukrainian descendants, many of whom live in | 23 | | Chicago's Ukrainian Village neighborhood. | 24 | | (b) For these reasons, the General Assembly urges: | 25 | | (1) the pension funds and retirement systems | 26 | | established under the Illinois Pension Code to divest |
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| 1 | | their holdings in any companies that are domiciled in | 2 | | Russia or Belarus and that are on the list of restricted | 3 | | companies developed by the Illinois Investment Policy | 4 | | Board; | 5 | | (2) all municipalities to reconsider any sister-city | 6 | | relationships they may have with cities in Russia; and | 7 | | (3) the United States Department of State to resettle | 8 | | Ukrainian refugees in Illinois.
| 9 | | Article 5. | 10 | | Section 5-1. Short title. This Article may be cited as the | 11 | | Money Laundering in Real Estate Task Force Act. References in | 12 | | this Article to "this Act" mean this Article. | 13 | | Section 5-3. Findings. The General Assembly finds and | 14 | | declares the following:
| 15 | | (1) the United States Department of Treasury's | 16 | | Financial Crimes Enforcement Network found, in 2017, that | 17 | | 30% of all high-end real estate purchases in major | 18 | | metropolitan areas involved beneficial owners or | 19 | | purchasers who were the subject of previous suspicious | 20 | | activity reports; | 21 | | (2) the United States, unlike Canada and several other | 22 | | jurisdictions, does not require real estate agents and | 23 | | brokers to file suspicious transaction reports; |
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| 1 | | (3) the lack of beneficial ownership transparency is | 2 | | an important factor in facilitating money laundering in | 3 | | real estate; and | 4 | | (4) money laundering in real estate has negative | 5 | | consequences for local communities, including the | 6 | | dislocation of residents from and within major | 7 | | metropolitan areas. | 8 | | Section 5-5. Money Laundering in Real Estate Task Force.
| 9 | | (a) The Money Laundering in Real Estate Task Force is | 10 | | created. The Task Force shall consist of the following | 11 | | members:
| 12 | | (1) 4 members appointed one each by the Speaker of the | 13 | | House of Representatives, the Minority Leader of the House | 14 | | of Representatives, the President of the Senate, and the | 15 | | Minority Leader of the Senate;
| 16 | | (2) the Secretary of Financial and Professional | 17 | | Regulation or the Secretary's designee;
| 18 | | (3) the Director of Revenue or the Director's | 19 | | designee; | 20 | | (4) 2 members of the faculty of an institution of | 21 | | higher education in the State with subject matter | 22 | | expertise regarding money laundering in real estate, | 23 | | appointed by the Governor;
| 24 | | (5) one expert on real estate tax law, appointed by | 25 | | the Governor; |
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| 1 | | (6) one representative of banking institutions with | 2 | | assets of at least $1,000,000,000, appointed by the | 3 | | Governor; | 4 | | (7) one representative of banking institutions with | 5 | | assets below $1,000,000,000, appointed by the Governor; | 6 | | (8) 2 representatives of a statewide organization | 7 | | representing real estate brokers, appointed by the | 8 | | Governor; and | 9 | | (9) 4 members with backgrounds in real estate, | 10 | | financial institutions, or law, appointed one each by the | 11 | | Speaker of the House of Representatives, the Minority | 12 | | Leader of the House of Representatives, the President of | 13 | | the Senate, and the Minority Leader of the Senate. | 14 | | (b) Initial appointments to the Task Force shall be made | 15 | | as soon as practicable after the effective date of this Act. | 16 | | The Task Force shall hold its first meeting within a | 17 | | reasonable period of time after its members have been | 18 | | appointed and shall convene regularly to carry out its duties | 19 | | and submit the reports required under this Act. At its first | 20 | | meeting, the Task Force shall elect its chairperson and any | 21 | | other officers from among its members. | 22 | | (c) The Department of Financial and Professional | 23 | | Regulation and the Department of Revenue shall provide | 24 | | administrative and other support to the Task Force. | 25 | | Section 5-10. Duties. The Task Force shall: |
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| 1 | | (1) identify vulnerabilities in the real estate sector | 2 | | that facilitate money laundering; | 3 | | (2) provide guidance to help actors in the real estate | 4 | | sector identify suspicious transactions and report them to | 5 | | the proper authorities; | 6 | | (3) explore the means by which illicit money is | 7 | | channeled into the real estate sector and integrated into | 8 | | the legal economy, including, but not limited to, cash | 9 | | purchases, complex loans, monetary instruments, mortgages, | 10 | | investment institutions, fraudulent appraisals, and | 11 | | anonymous corporate entities; | 12 | | (4) assess the exposure of the residential, | 13 | | industrial, and commercial real estate sectors in Illinois | 14 | | to illicit Russian money, including, but not limited to, | 15 | | luxury real estate in Chicago and nonresidential real | 16 | | estate in downstate communities; and | 17 | | (5) assess real estate due diligence and reporting | 18 | | practices, requirements, and laws in Illinois and | 19 | | recommend changes needed to eliminate systemic | 20 | | vulnerabilities that facilitate foreign money laundering. | 21 | | Section 5-15. Reports. The Task Force shall submit a | 22 | | report to the Governor and the General Assembly not later than | 23 | | 12 months after the effective date of this Act. The report | 24 | | shall include the Task Force's findings and shall summarize | 25 | | the actions the Task Force has taken and those it intends to |
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| 1 | | take in response to its obligations under the Act. After it | 2 | | submits its initial report, the Task Force shall periodically | 3 | | submit reports to the Governor and the General Assembly as the | 4 | | chairperson of the Task Force deems necessary to apprise those | 5 | | officials of any additional findings made or actions taken by | 6 | | the Task Force. The obligation of the Task Force to submit | 7 | | periodic reports shall continue for the duration of the Task | 8 | | Force. | 9 | | Section 5-20. Dissolution of Task Force; repeal. The Task | 10 | | Force is dissolved on January 1, 2025. This Act is repealed on | 11 | | January 1, 2026. | 12 | | Article 10. | 13 | | Section 10-5. The Illinois Administrative Procedure Act is | 14 | | amended by adding Section 5-45.35 as follows: | 15 | | (5 ILCS 100/5-45.35 new) | 16 | | Sec. 5-45.35. Emergency rulemaking; Refugee Resettlement | 17 | | Program. To ensure the availability of refugee resettlement | 18 | | program services in the case of an imminent, large-scale | 19 | | refugee resettlement event, emergency rules may be adopted in | 20 | | accordance with Section 5-45 by the Department of Human | 21 | | Services. The adoption of emergency rules authorized by | 22 | | Section 5-45 and this Section is deemed to be necessary for the |
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| 1 | | public interest, safety, and welfare. | 2 | | This Section is repealed one year after the effective date | 3 | | of this amendatory Act of the 102nd General Assembly. | 4 | | Section 10-7. The Election Code is amended by adding | 5 | | Section 1-22 as follows: | 6 | | (10 ILCS 5/1-22 new) | 7 | | Sec. 1-22. The Illinois Elections and Infrastructure | 8 | | Integrity Task Force. | 9 | | (a) The Illinois Elections and Infrastructure Integrity | 10 | | Task Force is created. The Task Force shall consist of the | 11 | | following members: | 12 | | (1) 4 members appointed one each by the Speaker of the | 13 | | House of Representatives, the Minority Leader of the House | 14 | | of Representatives, the President of the Senate, and the | 15 | | Minority Leader of the Senate; | 16 | | (2) one member with subject matter expertise regarding | 17 | | cybersecurity, appointed by the Minority Leader of the | 18 | | House of Representatives; | 19 | | (3) one member with subject matter expertise regarding | 20 | | voting technology or election integrity, appointed by the | 21 | | Speaker of the House; | 22 | | (4) one member who is an individual with current | 23 | | experience in operational cybersecurity, preferably | 24 | | international operational cybersecurity, appointed by the |
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| 1 | | President of the Senate; | 2 | | (5) one county clerk, appointed by the Minority Leader | 3 | | of the Senate; | 4 | | (6) the Chair of the Board of Election Commissioners | 5 | | for the City of Chicago or the Chair's designee; | 6 | | (7) the county clerk of Cook County; | 7 | | (8) one election administrator, appointed by the | 8 | | Governor; | 9 | | (9) the Executive Director of the State Board of | 10 | | Elections or the Executive Director's designee; | 11 | | (10) the Secretary of State or the Secretary's | 12 | | designee; | 13 | | (11) the Director of the Illinois Emergency Management | 14 | | Agency or the Director's designee; | 15 | | (12) the Secretary of Innovation and Technology or the | 16 | | Secretary's designee; and | 17 | | (13) the Attorney General or the Attorney General's | 18 | | designee. | 19 | | (b) The Task Force shall evaluate and make recommendations | 20 | | to prepare for and prevent foreign interference in elections | 21 | | in advance of the 2024 election and all future elections in the | 22 | | State and to prepare for and prevent potential cyberattacks on | 23 | | State infrastructure. In carrying out its duties, the Task | 24 | | Force shall prioritize the security of all Illinois residents | 25 | | and cooperation with other states and with law enforcement to | 26 | | protect United States national sovereignty. The Task Force |
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| 1 | | shall submit a report containing its findings and | 2 | | recommendations to the Governor and the General Assembly not | 3 | | later than January 1, 2024. The Task Force shall also submit a | 4 | | report evaluating the 2024 election to the Governor and the | 5 | | General Assembly not later than March 1, 2025. | 6 | | (c) The State Board of Elections shall provide staff and | 7 | | administrative support to the Task Force. | 8 | | (d) The Task Force is dissolved, and this Section is | 9 | | repealed, on June 1, 2025. | 10 | | Section 10-10. The Deposit of State Moneys Act is amended | 11 | | by adding Section 22.7 as follows: | 12 | | (15 ILCS 520/22.7 new) | 13 | | Sec. 22.7. Russian or Belarusian investments prohibited. | 14 | | Notwithstanding any provision of law to the contrary, the | 15 | | State Treasurer shall not invest State money in Russian or | 16 | | Belarusian sovereign debt, Russian or Belarusian | 17 | | government-backed securities, any investment instrument issued | 18 | | by an entity that is domiciled or has its principal place of | 19 | | business in Russia or Belarus, or any investment instrument | 20 | | issued by a company that is subject to Russian Harmful Foreign | 21 | | Activities Sanctions, as that term is defined under Section | 22 | | 1-110.16 of the Illinois Pension Code, and shall not invest or | 23 | | deposit State money in any bank that is domiciled or has its | 24 | | principal place of business in Russia or Belarus or in any |
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| 1 | | other financial institution that is domiciled or has its | 2 | | principal place of business in Russia or Belarus or that is | 3 | | subject to Russian Harmful Foreign Activities Sanctions. | 4 | | Section 10-20. The Illinois State Police Law of the
Civil | 5 | | Administrative Code of Illinois is amended by changing Section | 6 | | 2605-35 as follows:
| 7 | | (20 ILCS 2605/2605-35) (was 20 ILCS 2605/55a-3)
| 8 | | Sec. 2605-35. Division of Criminal
Investigation. | 9 | | (a) The Division of Criminal
Investigation shall exercise
| 10 | | the following functions and those in Section 2605-30:
| 11 | | (1) Exercise the rights, powers, and duties vested by
| 12 | | law in the Illinois State Police by the Illinois Horse | 13 | | Racing Act of 1975, including those set forth in Section | 14 | | 2605-215.
| 15 | | (2) Investigate the origins, activities, personnel, | 16 | | and
incidents of crime and enforce the criminal laws of | 17 | | this State related thereto.
| 18 | | (3) Enforce all laws regulating the production, sale,
| 19 | | prescribing, manufacturing, administering, transporting, | 20 | | having in possession,
dispensing, delivering, | 21 | | distributing, or use of controlled substances
and | 22 | | cannabis.
| 23 | | (4) Cooperate with the police of cities, villages, and
| 24 | | incorporated towns and with the police officers of any |
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| 1 | | county in
enforcing the laws of the State and in making | 2 | | arrests and recovering
property.
| 3 | | (5) Apprehend and deliver up any person charged in | 4 | | this State or any other
state with treason or a felony or | 5 | | other crime who has fled from justice and is
found in this | 6 | | State.
| 7 | | (6) Investigate recipients and providers under the | 8 | | Illinois Public Aid
Code and any personnel involved in the | 9 | | administration of the Code who are
suspected of any | 10 | | violation of the Code pertaining to fraud in the
| 11 | | administration, receipt, or provision of assistance and | 12 | | pertaining to any
violation of criminal law; and exercise | 13 | | the functions required under Section
2605-220 in the | 14 | | conduct of those investigations.
| 15 | | (7) Conduct other investigations as provided by law.
| 16 | | (8) Investigate public corruption.
| 17 | | (9) Exercise other duties that may be assigned by the | 18 | | Director in order to
fulfill the responsibilities and | 19 | | achieve the purposes of the Illinois State Police, which | 20 | | may include the coordination of gang, terrorist, and | 21 | | organized crime prevention, control activities, and | 22 | | assisting local law enforcement in their crime control | 23 | | activities.
| 24 | | (10) Conduct investigations (and cooperate with | 25 | | federal law enforcement agencies in the investigation) of | 26 | | any property-related crimes, such as money laundering, |
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| 1 | | involving individuals or entities listed on the sanctions | 2 | | list maintained by the U.S. Department of Treasury's | 3 | | Office of Foreign Asset Control. | 4 | | (b) (Blank).
| 5 | | (Source: P.A. 102-538, eff. 8-20-21; 102-813, eff. 5-13-22.)
| 6 | | Section 10-30. The Public Funds Investment Act is amended | 7 | | by adding Section 2.3 as follows: | 8 | | (30 ILCS 235/2.3 new) | 9 | | Sec. 2.3. Russian or Belarusian investments prohibited. | 10 | | Notwithstanding any provision of law to the contrary, a public | 11 | | agency shall not invest public funds in Russian or Belarusian | 12 | | sovereign debt, Russian or Belarusian government-backed | 13 | | securities, any investment instrument issued by an entity that | 14 | | is domiciled or has its principal place of business in Russia | 15 | | or Belarus, or any investment instrument issued by a company | 16 | | that is subject to Russian Harmful Foreign Activities | 17 | | Sanctions, as that term is defined under Section 1-110.16 of | 18 | | the Illinois Pension Code, and shall not invest or deposit | 19 | | public funds in any bank that is domiciled or has its principal | 20 | | place of business in Russia or Belarus or in any other | 21 | | financial institution that is domiciled or has its principal | 22 | | place of business in Russia or Belarus or that is subject to | 23 | | Russian Harmful Foreign Activities Sanctions. |
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| 1 | | Section 10-35. The Illinois Pension Code is amended by | 2 | | changing Section 1-110.16 as follows: | 3 | | (40 ILCS 5/1-110.16) | 4 | | Sec. 1-110.16. Transactions prohibited by retirement | 5 | | systems; companies that boycott Israel, for-profit companies | 6 | | that contract to shelter migrant children, Iran-restricted | 7 | | companies, Sudan-restricted companies, and expatriated | 8 | | entities , companies that are domiciled or have their principal | 9 | | place of business in Russia or Belarus, and companies that are | 10 | | subject to Russian Harmful Foreign Activities Sanctions . | 11 | | (a) As used in this Section: | 12 | | "Boycott Israel" means engaging in actions that are | 13 | | politically motivated and are intended to penalize, | 14 | | inflict economic harm on, or otherwise limit commercial | 15 | | relations with the State of Israel or companies based in | 16 | | the State of Israel or in territories controlled by the | 17 | | State of Israel. | 18 | | "Company" means any sole proprietorship, organization, | 19 | | association, corporation, partnership, joint venture, | 20 | | limited partnership, limited liability partnership, | 21 | | limited liability company, or other entity or business | 22 | | association, including all wholly owned subsidiaries, | 23 | | majority-owned subsidiaries, parent companies, or | 24 | | affiliates of those entities or business associations, | 25 | | that exist for the purpose of making profit. |
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| 1 | | "Company that is subject to Russian Harmful Foreign | 2 | | Activities Sanctions" means a company that is subject to | 3 | | sanctions under the Russian Harmful Foreign Activities | 4 | | Sanctions Regulations (31 CFR Part 587), any Presidential | 5 | | Executive Order imposing sanctions against Russia, or any | 6 | | federal directive issued pursuant to any such Executive | 7 | | Order. | 8 | | "Contract to shelter migrant children" means entering | 9 | | into a contract with the federal government to shelter | 10 | | migrant children under the federal Unaccompanied Alien | 11 | | Children Program or a substantially similar federal | 12 | | program. | 13 | | "Illinois Investment Policy Board" means the board | 14 | | established under subsection (b) of this Section. | 15 | | "Direct holdings" in a company means all publicly | 16 | | traded securities of that company that are held directly | 17 | | by the retirement system in an actively managed account or | 18 | | fund in which the retirement system owns all shares or | 19 | | interests. | 20 | | "Expatriated entity" has the meaning ascribed to it in | 21 | | Section 1-15.120 of the Illinois Procurement Code. | 22 | | "Illinois Investment Policy Board" means the board | 23 | | established under subsection (b) of this Section. | 24 | | "Indirect holdings" in a company means all securities | 25 | | of that company that are held in an account or fund, such | 26 | | as a mutual fund, managed by one or more persons not |
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| 1 | | employed by the retirement system, in which the retirement | 2 | | system owns shares or interests together with other | 3 | | investors not subject to the provisions of this Section or | 4 | | that are held in an index fund. | 5 | | "Iran-restricted company" means a company that meets | 6 | | the qualifications under Section 1-110.15 of this Code. | 7 | | "Private market fund" means any private equity fund, | 8 | | private equity funds of funds, venture capital fund, hedge | 9 | | fund, hedge fund of funds, real estate fund, or other | 10 | | investment vehicle that is not publicly traded. | 11 | | "Restricted companies" means companies that boycott | 12 | | Israel, for-profit companies that contract to shelter | 13 | | migrant children, Iran-restricted companies, | 14 | | Sudan-restricted companies, and expatriated entities , | 15 | | companies that are domiciled or have their principal place | 16 | | of business in Russia or Belarus, and companies that are | 17 | | subject to Russian Harmful Foreign Activities Sanctions . | 18 | | "Retirement system" means a retirement system | 19 | | established under Article 2, 14, 15, 16, or 18 of this Code | 20 | | or the Illinois State Board of Investment. | 21 | | "Sudan-restricted company" means a company that meets | 22 | | the qualifications under Section 1-110.6 of this Code. | 23 | | (b) There shall be established an Illinois Investment | 24 | | Policy Board. The Illinois Investment Policy Board shall | 25 | | consist of 7 members. Each board of a pension fund or | 26 | | investment board created under Article 15, 16, or 22A of this |
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| 1 | | Code shall appoint one member, and the Governor shall appoint | 2 | | 4 members. The Governor shall designate one member of the | 3 | | Board as the Chairperson. | 4 | | (b-5) The term of office of each member appointed by the | 5 | | Governor, who is serving on the Board on June 30, 2022, is | 6 | | abolished on that date. The terms of office of members | 7 | | appointed by the Governor after June 30, 2022 shall be as | 8 | | follows: 2 initial members shall be appointed for terms of 2 | 9 | | years, and 2 initial members shall be appointed for terms of 4 | 10 | | years. Thereafter, the members appointed by the Governor shall | 11 | | hold office for 4 years, except that any member chosen to fill | 12 | | a vacancy occurring otherwise than by expiration of a term | 13 | | shall be appointed only for the unexpired term of the member | 14 | | whom he or she shall succeed. Board members may be | 15 | | reappointed. The Governor may remove a Governor's appointee to | 16 | | the Board for incompetence, neglect of duty, malfeasance, or | 17 | | inability to serve. | 18 | | (c) Notwithstanding any provision of law to the contrary, | 19 | | beginning January 1, 2016, Sections 1-110.15 110.15 and | 20 | | 1-110.6 of this Code shall be administered in accordance with | 21 | | this Section. | 22 | | (d) By April 1, 2016, the Illinois Investment Policy Board | 23 | | shall make its best efforts to identify all Iran-restricted | 24 | | companies, Sudan-restricted companies, and companies that | 25 | | boycott Israel and assemble those identified companies into a | 26 | | list of restricted companies, to be distributed to each |
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| 1 | | retirement system. | 2 | | These efforts shall include the following, as appropriate | 3 | | in the Illinois Investment Policy Board's judgment: | 4 | | (1) reviewing and relying on publicly available | 5 | | information regarding Iran-restricted companies, | 6 | | Sudan-restricted companies, and companies that boycott | 7 | | Israel, including information provided by nonprofit | 8 | | organizations, research firms, and government entities; | 9 | | (2) contacting asset managers contracted by the | 10 | | retirement systems that invest in Iran-restricted | 11 | | companies, Sudan-restricted companies, and companies that | 12 | | boycott Israel; | 13 | | (3) contacting other institutional investors that have | 14 | | divested from or engaged with Iran-restricted companies, | 15 | | Sudan-restricted companies, and companies that boycott | 16 | | Israel; and | 17 | | (4) retaining an independent research firm to identify | 18 | | Iran-restricted companies, Sudan-restricted companies, | 19 | | and companies that boycott Israel. | 20 | | The Illinois Investment Policy Board shall review the list | 21 | | of restricted companies on a quarterly basis based on evolving | 22 | | information from, among other sources, those listed in this | 23 | | subsection (d) and distribute any updates to the list of | 24 | | restricted companies to the retirement systems and the State | 25 | | Treasurer. | 26 | | By April 1, 2018, the Illinois Investment Policy Board |
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| 1 | | shall make its best efforts to identify all expatriated | 2 | | entities and include those companies in the list of restricted | 3 | | companies distributed to each retirement system and the State | 4 | | Treasurer. These efforts shall include the following, as | 5 | | appropriate in the Illinois Investment Policy Board's | 6 | | judgment: | 7 | | (1) reviewing and relying on publicly available | 8 | | information regarding expatriated entities, including | 9 | | information provided by nonprofit organizations, research | 10 | | firms, and government entities; | 11 | | (2) contacting asset managers contracted by the | 12 | | retirement systems that invest in expatriated entities; | 13 | | (3) contacting other institutional investors that have | 14 | | divested from or engaged with expatriated entities; and | 15 | | (4) retaining an independent research firm to identify | 16 | | expatriated entities. | 17 | | By July 1, 2022, the Illinois Investment Policy Board | 18 | | shall make its best efforts to identify all for-profit | 19 | | companies that contract to shelter migrant children and | 20 | | include those companies in the list of restricted companies | 21 | | distributed to each retirement system. These efforts shall | 22 | | include the following, as appropriate in the Illinois | 23 | | Investment Policy Board's judgment: | 24 | | (1) reviewing and relying on publicly available | 25 | | information regarding for-profit companies that contract | 26 | | to shelter migrant children, including information |
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| 1 | | provided by nonprofit organizations, research firms, and | 2 | | government entities; | 3 | | (2) contacting asset managers contracted by the | 4 | | retirement systems that invest in for-profit companies | 5 | | that contract to shelter migrant children; | 6 | | (3) contacting other institutional investors that have | 7 | | divested from or engaged with for-profit companies that | 8 | | contract to shelter migrant children; and | 9 | | (4) retaining an independent research firm to identify | 10 | | for-profit companies that contract to shelter migrant | 11 | | children. | 12 | | No later than 6 months after the effective date of this | 13 | | amendatory Act of the 102nd General Assembly, the Illinois | 14 | | Investment Policy Board shall make its best efforts to | 15 | | identify all companies that are domiciled or have their | 16 | | principal place of business in Russia or Belarus and companies | 17 | | that are subject to Russian Harmful Foreign Activities | 18 | | Sanctions and include those companies in the list of | 19 | | restricted companies distributed to each retirement system. | 20 | | These efforts shall include the following, as appropriate in | 21 | | the Illinois Investment Policy Board's judgment: | 22 | | (1) reviewing and relying on publicly available
| 23 | | information regarding companies that are domiciled or have | 24 | | their principal place of business in Russia or Belarus and | 25 | | companies that are subject to Russian Harmful Foreign | 26 | | Activities Sanctions, including information provided by |
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| 1 | | nonprofit organizations, research firms, and government | 2 | | entities; | 3 | | (2) contacting asset managers contracted by the
| 4 | | retirement systems that invest in companies that are | 5 | | domiciled or have their principal place of business in | 6 | | Russia or Belarus and companies that are subject to | 7 | | Russian Harmful Foreign Activities Sanctions; | 8 | | (3) contacting other institutional investors that have | 9 | | divested from or engaged with companies that are domiciled | 10 | | or have their principal place of business in Russia or | 11 | | Belarus and companies that are subject to Russian Harmful | 12 | | Foreign Activities Sanctions; and | 13 | | (4) retaining an independent research firm to
identify | 14 | | companies that are domiciled or have their principal place | 15 | | of business in Russia or Belarus and companies that are | 16 | | subject to Russian Harmful Foreign Activities Sanctions. | 17 | | (e) The Illinois Investment Policy Board shall adhere to | 18 | | the following procedures for companies on the list of | 19 | | restricted companies: | 20 | | (1) For each company newly identified in subsection | 21 | | (d), the Illinois Investment Policy Board , unless it | 22 | | determines by an affirmative vote that it is unfeasible, | 23 | | shall send a written notice informing the company of its | 24 | | status and that it may become subject to divestment or | 25 | | shareholder activism by the retirement systems. | 26 | | (2) If, following the Illinois Investment Policy |
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| 1 | | Board's engagement pursuant to this subsection (e) with a | 2 | | restricted company, that company ceases activity that | 3 | | designates the company to be an Iran-restricted company, a | 4 | | Sudan-restricted company, a company that boycotts Israel, | 5 | | an expatriated entity, or a for-profit company that | 6 | | contracts to shelter migrant children, the company shall | 7 | | be removed from the list of restricted companies and the | 8 | | provisions of this Section shall cease to apply to it | 9 | | unless it resumes such activities. | 10 | | (3) For a company that is domiciled or has its | 11 | | principal place of business in Russia or Belarus, if, | 12 | | following the Illinois Investment Policy Board's | 13 | | engagement pursuant to this subsection (e), that company | 14 | | is no longer domiciled or has its principal place of | 15 | | business in Russia or Belarus, the company shall be | 16 | | removed from the list of restricted companies and the | 17 | | provisions of this Section shall cease to apply to it | 18 | | unless it becomes domiciled or has its principal place of | 19 | | business in Russia or Belarus. | 20 | | (4) For a company that is subject to Russian Harmful | 21 | | Foreign Activities Sanctions, if, following the Illinois | 22 | | Investment Policy Board's engagement pursuant to this | 23 | | subsection (e), that company is no longer subject to | 24 | | Russian Harmful Foreign Activities Sanctions, the company | 25 | | shall be removed from the list of restricted companies and | 26 | | the provisions of this Section shall cease to apply to it |
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| 1 | | unless it becomes subject to Russian Harmful Foreign | 2 | | Activities Sanctions. | 3 | | (f) Except as provided in subsection (f-1) of this Section | 4 | | the retirement system shall adhere to the following procedures | 5 | | for companies on the list of restricted companies: | 6 | | (1) The retirement system shall identify those | 7 | | companies on the list of restricted companies in which the | 8 | | retirement system owns direct holdings and indirect | 9 | | holdings. | 10 | | (2) The retirement system shall instruct its | 11 | | investment advisors to sell, redeem, divest, or withdraw | 12 | | all direct holdings of restricted companies from the | 13 | | retirement system's assets under management in an orderly | 14 | | and fiduciarily responsible manner within 12 months after | 15 | | the company's most recent appearance on the list of | 16 | | restricted companies. | 17 | | (3) The retirement system may not acquire securities | 18 | | of restricted companies. | 19 | | (4) The provisions of this subsection (f) do not apply | 20 | | to the retirement system's indirect holdings or private | 21 | | market funds. The Illinois Investment Policy Board shall | 22 | | submit letters to the managers of those investment funds | 23 | | containing restricted companies requesting that they | 24 | | consider removing the companies from the fund or create a | 25 | | similar actively managed fund having indirect holdings | 26 | | devoid of the companies. If the manager creates a similar |
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| 1 | | fund, the retirement system shall replace all applicable | 2 | | investments with investments in the similar fund in an | 3 | | expedited timeframe consistent with prudent investing | 4 | | standards. | 5 | | (f-1) The retirement system shall adhere to the following | 6 | | procedures for restricted companies that are expatriated | 7 | | entities or for-profit companies that contract to shelter | 8 | | migrant children: | 9 | | (1) To the extent that the retirement system believes | 10 | | that shareholder activism would be more impactful than | 11 | | divestment, the retirement system shall have the authority | 12 | | to engage with a restricted company prior to divesting. | 13 | | (2) Subject to any applicable State or Federal laws, | 14 | | methods of shareholder activism utilized by the retirement | 15 | | system may include, but are not limited to, bringing | 16 | | shareholder resolutions and proxy voting on shareholder | 17 | | resolutions. | 18 | | (3) The retirement system shall report on its | 19 | | shareholder activism and the outcome of such efforts to | 20 | | the Illinois Investment Policy Board by April 1 of each | 21 | | year. | 22 | | (4) If the engagement efforts of the retirement system | 23 | | are unsuccessful, then it shall adhere to the procedures | 24 | | under subsection (f) of this Section. | 25 | | (f-5) Beginning on the effective date of this amendatory | 26 | | Act of the 102nd General Assembly, no retirement system shall |
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| 1 | | invest moneys in Russian or Belarusian sovereign debt, Russian | 2 | | or Belarusian government-backed securities, any investment | 3 | | instrument issued by an entity that is domiciled or has its | 4 | | principal place of business in Russia or Belarus, or any | 5 | | investment instrument issued by a company that is subject to | 6 | | Russian Harmful Foreign Activities Sanctions, and no | 7 | | retirement system shall invest or deposit State moneys in any | 8 | | bank that is domiciled or has its principal place of business | 9 | | in Russia or Belarus. As soon as practicable after the | 10 | | effective date of this amendatory Act of the 102nd General | 11 | | Assembly, each retirement system shall instruct its investment | 12 | | advisors to sell, redeem, divest, or withdraw all direct | 13 | | holdings of Russian or Belarusian sovereign debt and direct | 14 | | holdings of Russian or Belarusian government-backed securities | 15 | | from the retirement system's assets under management in an | 16 | | orderly and fiduciarily responsible manner. | 17 | | Notwithstanding any provision of this Section to the | 18 | | contrary, a retirement system may cease divestment pursuant to | 19 | | this subsection (f-5) if clear and convincing evidence shows | 20 | | that the value of investments in such Russian or Belarusian | 21 | | sovereign debt and Russian or Belarusian government-backed | 22 | | securities becomes equal to or less than 0.05% of the market | 23 | | value of all assets under management by the retirement system. | 24 | | For any cessation of divestment authorized by this subsection | 25 | | (f-5), the retirement system shall provide a written notice to | 26 | | the Illinois Investment Policy Board in advance of the |
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| 1 | | cessation of divestment, setting forth the reasons and | 2 | | justification, supported by clear and convincing evidence, for | 3 | | its decision to cease divestment under this subsection (f-5). | 4 | | The provisions of this subsection (f-5) do not apply to | 5 | | the retirement system's indirect holdings or private market | 6 | | funds. | 7 | | (g) Upon request, and by April 1 of each year, each | 8 | | retirement system shall provide the Illinois Investment Policy | 9 | | Board with information regarding investments sold, redeemed, | 10 | | divested, or withdrawn in compliance with this Section. | 11 | | (h) Notwithstanding any provision of this Section to the | 12 | | contrary, a retirement system may cease divesting from | 13 | | companies pursuant to subsection (f) if clear and convincing | 14 | | evidence shows that the value of investments in such companies | 15 | | becomes equal to or less than 0.5% of the market value of all | 16 | | assets under management by the retirement system. For any | 17 | | cessation of divestment authorized by this subsection (h), the | 18 | | retirement system shall provide a written notice to the | 19 | | Illinois Investment Policy Board in advance of the cessation | 20 | | of divestment, setting forth the reasons and justification, | 21 | | supported by clear and convincing evidence, for its decision | 22 | | to cease divestment under subsection (f). | 23 | | (i) The cost associated with the activities of the | 24 | | Illinois Investment Policy Board shall be borne by the boards | 25 | | of each pension fund or investment board created under Article | 26 | | 15, 16, or 22A of this Code. |
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| 1 | | (j) With respect to actions taken in compliance with this | 2 | | Section, including all good-faith determinations regarding | 3 | | companies as required by this Section, the retirement system | 4 | | and Illinois Investment Policy Board are exempt from any | 5 | | conflicting statutory or common law obligations, including any | 6 | | fiduciary duties under this Article and any obligations with | 7 | | respect to choice of asset managers, investment funds, or | 8 | | investments for the retirement system's securities portfolios. | 9 | | (k) It is not the intent of the General Assembly in | 10 | | enacting this amendatory Act of the 99th General Assembly to | 11 | | cause divestiture from any company based in the United States | 12 | | of America. The Illinois Investment Policy Board shall | 13 | | consider this intent when developing or reviewing the list of | 14 | | restricted companies. | 15 | | (l) If any provision of this amendatory Act of the 99th | 16 | | General Assembly or its application to any person or | 17 | | circumstance is held invalid, the invalidity of that provision | 18 | | or application does not affect other provisions or | 19 | | applications of this amendatory Act of the 99th General | 20 | | Assembly that can be given effect without the invalid | 21 | | provision or application.
| 22 | | If any provision of Public Act 100-551 or its application | 23 | | to any person or circumstance is held invalid, the invalidity | 24 | | of that provision or application does not affect other | 25 | | provisions or applications of Public Act 100-551 that can be | 26 | | given effect without the invalid provision or application. |
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| 1 | | If any provision of Public Act 102-118 this amendatory Act | 2 | | of the 102nd General Assembly or its application to any person | 3 | | or circumstance is held invalid, the invalidity of that | 4 | | provision or application does not affect other provisions or | 5 | | applications of Public Act 102-118 this amendatory Act of the | 6 | | 102nd General Assembly that can be given effect without the | 7 | | invalid provision or application. | 8 | | If any provision of this amendatory Act of the 102nd | 9 | | General Assembly or its application to any person or | 10 | | circumstance is held invalid, the invalidity of that provision | 11 | | or application does not affect other provisions or | 12 | | applications of this amendatory Act of the 102nd General | 13 | | Assembly that can be given effect without the invalid | 14 | | provision or application. | 15 | | (Source: P.A. 102-118, eff. 7-23-21; 102-699, eff. 4-19-22.) | 16 | | Section 10-40. The Board of Higher Education Act is | 17 | | amended by adding Section 9.42 as follows: | 18 | | (110 ILCS 205/9.42 new) | 19 | | Sec. 9.42. Disclosure of donations from certain Russian, | 20 | | Belarusian, or sanctioned sources. The Board shall require | 21 | | each public institution of higher education to disclose to the | 22 | | Board any endowment or other donation given to the institution | 23 | | from a source associated with any individual or entity listed | 24 | | on the sanctions list maintained by the U.S. Department of |
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| 1 | | Treasury's Office of Foreign Asset Control or any company that | 2 | | is domiciled or has its principal place of business in Russia | 3 | | or Belarus and is on the list of restricted companies | 4 | | developed by the Illinois Investment Policy Board under | 5 | | Section 1-110.16 of the Illinois Pension Code. | 6 | | Article 99. | 7 | | Section 99-97. Severability. The provisions of this Act | 8 | | are severable under Section 1.31 of the Statute on Statutes.
| 9 | | Section 99-99. Effective date. This Act takes effect upon | 10 | | becoming law.
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