Full Text of HB3155 103rd General Assembly
HB3155enr 103RD GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning employment.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Secure Choice Savings Program Act | 5 | | is amended by changing Sections 5 and 30 as follows: | 6 | | (820 ILCS 80/5) | 7 | | Sec. 5. Definitions. Unless the context requires a | 8 | | different meaning or as expressly provided in this Section, | 9 | | all terms shall have the same meaning as when used in a | 10 | | comparable context in the Internal Revenue Code. As used in | 11 | | this Act: | 12 | | "Board" means the Illinois Secure Choice Savings Board | 13 | | established under this Act. | 14 | | "Department" means the Department of Revenue. | 15 | | "Director" means the Director of Revenue. | 16 | | "Employee" means any individual who is employed by an | 17 | | employer, and who has wages that are allocable to Illinois | 18 | | during a calendar year under the provisions of Section | 19 | | 304(a)(2)(B) of the Illinois Income Tax Act. | 20 | | "Employer" means a person or entity engaged in a business, | 21 | | industry, profession, trade, or other enterprise in Illinois, | 22 | | whether for profit or not for profit, that (i) has employed at | 23 | | least 5 employees in the State during every quarter of the |
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| 1 | | previous calendar year, (ii) has been in business at least 2 | 2 | | years, and (iii) is not offering or contributing to has not | 3 | | offered a qualified retirement plan, including, but not | 4 | | limited to, a plan qualified under Section 401(a), Section | 5 | | 401(k), Section 403(a), Section 403(b), Section 408(k), | 6 | | Section 408(p), or Section 457(b) of the Internal Revenue Code | 7 | | of 1986 in the preceding 2 years . "Employer" does not include | 8 | | the federal government, the State, any county, any municipal | 9 | | corporation, or any of the State's units or instrumentalities. | 10 | | "Enrollee" means any employee who is enrolled in the | 11 | | Program.
| 12 | | "Fund" means the Illinois Secure Choice Savings Program | 13 | | Fund.
| 14 | | "Internal Revenue Code" means Internal Revenue Code of | 15 | | 1986, or any successor law, in effect for the calendar year.
| 16 | | "IRA" means a Roth or Traditional IRA (individual | 17 | | retirement account) under Section 408 or 408A of the Internal | 18 | | Revenue Code.
| 19 | | "Participating employer" means an employer or small | 20 | | employer that facilitates a payroll deposit retirement savings | 21 | | arrangement as provided for by this Act for its employees. | 22 | | "Payroll deposit retirement savings arrangement" means an | 23 | | arrangement by which a participating employer facilitates | 24 | | payroll deduction contributions from enrollees to the Program. | 25 | | "Program" means the Illinois Secure Choice Savings | 26 | | Program.
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| 1 | | "Small employer" means a person or entity engaged in a | 2 | | business, industry, profession, trade, or other enterprise in | 3 | | Illinois, whether for profit or not for profit, that (i) | 4 | | employed less than 5 employees during any quarter of the | 5 | | previous calendar year, or (ii) has been in business less than | 6 | | 2 years, or both items (i) and (ii), but that notifies the | 7 | | Board that it is interested in being a participating employer. | 8 | | "Wages" means any compensation within the meaning of | 9 | | Section 219(f)(1) of the Internal Revenue Code that is | 10 | | received by an enrollee from a participating employer during | 11 | | the calendar year.
| 12 | | (Source: P.A. 101-353, eff. 8-9-19; 102-179, eff. 1-1-22 .) | 13 | | (820 ILCS 80/30) | 14 | | Sec. 30. Duties of the Board. In addition to the other | 15 | | duties and responsibilities stated in this Act, the Board | 16 | | shall: | 17 | | (a) Cause the Program to be designed, established and | 18 | | operated in a manner that: | 19 | | (1) accords with best practices for retirement | 20 | | savings vehicles; | 21 | | (2) maximizes participation, savings, and sound | 22 | | investment practices; | 23 | | (3) maximizes simplicity, including ease of | 24 | | administration for participating employers and | 25 | | enrollees; |
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| 1 | | (4) provides an efficient product to enrollees by | 2 | | pooling investment funds; | 3 | | (5) ensures the portability of benefits; and | 4 | | (6) provides for the deaccumulation of enrollee | 5 | | assets in a manner that maximizes financial security | 6 | | in retirement. | 7 | | (b) Appoint a trustee to the IRA Fund in compliance | 8 | | with Section 408 of the Internal Revenue Code. | 9 | | (c) Explore and establish investment options, subject | 10 | | to Section 45 of this Act, that offer employees returns on | 11 | | contributions and the conversion of individual retirement | 12 | | savings account balances to secure retirement income | 13 | | without incurring debt or liabilities to the State. | 14 | | (d) Establish the process by which interest, | 15 | | investment earnings, and investment losses are allocated | 16 | | to individual program accounts on a pro rata basis and are | 17 | | computed at the interest rate on the balance of an | 18 | | individual's account. | 19 | | (e) Make and enter into contracts necessary for the | 20 | | administration of the Program and Fund, including, but not | 21 | | limited to, retaining and contracting with investment | 22 | | managers, private financial institutions, other financial | 23 | | and service providers, consultants, actuaries, counsel, | 24 | | auditors, third-party administrators, and other | 25 | | professionals as necessary. | 26 | | (e-5) Conduct a review of the performance of any |
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| 1 | | investment vendors every 4 years, including, but not | 2 | | limited to, a review of returns, fees, and customer | 3 | | service. A copy of reviews conducted under this subsection | 4 | | (e-5) shall be posted to the Board's Internet website. | 5 | | (f) In collaboration with the State Treasurer, | 6 | | determine Determine the number and duties of staff members | 7 | | needed to administer the Program and assemble such a | 8 | | staff , including, as needed, employing staff, appointing a | 9 | | Program administrator, and entering into contracts with | 10 | | the State Treasurer to make employees of the State | 11 | | Treasurer's Office available to administer the Program . | 12 | | (g) Cause moneys in the Fund to be held and invested as | 13 | | pooled investments described in Section 45 of this Act, | 14 | | with a view to achieving cost savings through efficiencies | 15 | | and economies of scale. | 16 | | (h) Evaluate and establish the process by which an | 17 | | enrollee is able to contribute a portion of his or her | 18 | | wages to the Program for automatic deposit of those | 19 | | contributions and the process by which the participating | 20 | | employer provides a payroll deposit retirement savings | 21 | | arrangement to forward those contributions and related | 22 | | information to the Program, including, but not limited to, | 23 | | contracting with financial service companies and | 24 | | third-party administrators with the capability to receive | 25 | | and process employee information and contributions for | 26 | | payroll deposit retirement savings arrangements or similar |
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| 1 | | arrangements. | 2 | | (i) Design and establish the process for enrollment | 3 | | under Section 60 of this Act, including the process by | 4 | | which an employee can opt not to participate in the | 5 | | Program, select a contribution level, select an investment | 6 | | option, and terminate participation in the Program. | 7 | | (j) Evaluate and establish the process by which an | 8 | | individual may voluntarily enroll in and make | 9 | | contributions to the Program. | 10 | | (k) Accept any grants, appropriations, or other moneys | 11 | | from the State, any unit of federal, State, or local | 12 | | government, or any other person, firm, partnership, or | 13 | | corporation solely for deposit into the Fund, whether for | 14 | | investment or administrative purposes.
| 15 | | (l) Evaluate the need for, and procure as needed, | 16 | | insurance against any and all loss in connection with the | 17 | | property, assets, or activities of the Program, and | 18 | | indemnify as needed each member of the Board from personal | 19 | | loss or liability resulting from a member's action or | 20 | | inaction as a member of the Board. | 21 | | (m) Make provisions for the payment of administrative | 22 | | costs and expenses for the creation, management, and | 23 | | operation of the Program, including the costs associated | 24 | | with subsection (b) of Section 20 of this Act, subsections | 25 | | (e), (f), (h), and (l) of this Section, subsection (b) of | 26 | | Section 45 of this Act, subsection (a) of Section 80 of |
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| 1 | | this Act, and subsection (n) of Section 85 of this Act. | 2 | | Subject to appropriation, the State may pay administrative | 3 | | costs associated with the creation and management of the | 4 | | Program until sufficient assets are available in the Fund | 5 | | for that purpose. Thereafter, all administrative costs of | 6 | | the Fund , including repayment of any start-up funds | 7 | | provided by the State, shall be paid only out of moneys on | 8 | | deposit therein. However, private funds or federal funding | 9 | | received under subsection (k) of Section 30 of this Act in | 10 | | order to implement the Program until the Fund is | 11 | | self-sustaining shall not be repaid unless those funds | 12 | | were offered contingent upon the promise of such | 13 | | repayment. The Board shall keep investment fees total | 14 | | annual expenses as low as possible, but in no event shall | 15 | | they exceed 0.25% 0.75% of the total trust balance. The | 16 | | Board may charge administrative fees, established by rule, | 17 | | that shall be consistent with industry standards. | 18 | | (n) Allocate administrative fees to individual | 19 | | retirement accounts in the Program on a pro rata basis. | 20 | | (o) Set minimum and maximum contribution levels in | 21 | | accordance with limits established for IRAs by the | 22 | | Internal Revenue Code. | 23 | | (o-5) Select a default contribution rate for Program | 24 | | participants within the range of 3% to 6% of an enrollee's | 25 | | wages. | 26 | | (o-10) Establish annual, automatic increases to the |
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| 1 | | contribution rates based upon a schedule provided for in | 2 | | rules up to a maximum of 10% of an enrollee's wages. | 3 | | (p) Facilitate education and outreach to employers and | 4 | | employees. | 5 | | (q) Facilitate compliance by the Program with all | 6 | | applicable requirements for the Program under the Internal | 7 | | Revenue Code, including tax qualification requirements or | 8 | | any other applicable law and accounting requirements. | 9 | | (q-5) Verify employee eligibility for auto-enrollment | 10 | | in accordance with the Internal Revenue Code and | 11 | | applicable Federal and State laws. The verification shall | 12 | | include the rejection of any enrollee under 18 years of | 13 | | age. | 14 | | (r) Carry out the duties and obligations of the | 15 | | Program in an effective, efficient, and low-cost manner. | 16 | | (s) Exercise any and all other powers reasonably | 17 | | necessary for the effectuation of the purposes, | 18 | | objectives, and provisions of this Act pertaining to the | 19 | | Program. | 20 | | (t) Deposit into the Illinois Secure Choice | 21 | | Administrative Fund all grants, gifts, donations, fees, | 22 | | and earnings from investments from the Illinois Secure | 23 | | Choice Savings Program Fund that are used to recover | 24 | | administrative costs. All expenses of the Board shall be | 25 | | paid from the Illinois Secure Choice Administrative Fund.
| 26 | | The Board may enter into agreements with other |
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| 1 | | governmental entities, including other states or their | 2 | | agencies and instrumentalities, to enable residents of other | 3 | | states to participate in the Program. | 4 | | (Source: P.A. 101-353, eff. 8-9-19; 102-179, eff. 1-1-22 .)
| 5 | | Section 99. Effective date. This Act takes effect upon | 6 | | becoming law.
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