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91_SB1952
LRB9112351LDtm
1 AN ACT to amend the Illinois Lottery Law by changing
2 Section 13 and adding Section 13.1.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Lottery Law is amended by
6 changing Section 13 and adding Section 13.1 as follows:
7 (20 ILCS 1605/13) (from Ch. 120, par. 1163)
8 Sec. 13. No prize, nor any portion of a prize, nor any
9 right of any person to a prize awarded shall be assignable,
10 except as provided in Section 13.1. Any prize, or portion
11 thereof remaining unpaid at the death of a prize winner, may
12 be paid to the estate of such deceased prize winner, or to
13 the trustee under a revocable living trust established by the
14 deceased prize winner as settlor, provided that a copy of
15 such a trust has been filed with the Department along with a
16 notarized letter of direction from the settlor and no written
17 notice of revocation has been received by the Department
18 prior to the settlor's death. Following such a settlor's
19 death and prior to any payment to such a successor trustee,
20 the Director shall obtain from the trustee and each trust
21 beneficiary a written agreement to indemnify and hold the
22 Department harmless with respect to any claims that may be
23 asserted against the Department arising from payment to or
24 through the trust. Notwithstanding any other provision of
25 this Section, any person pursuant to an appropriate judicial
26 order may be paid the prize to which a winner is entitled,
27 and all or part of any prize otherwise payable by State
28 warrant under this Section shall be withheld upon
29 certification to the State Comptroller from the Illinois
30 Department of Public Aid as provided in Section 10-17.5 of
31 The Illinois Public Aid Code. The Director shall be
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1 discharged of all further liability upon payment of a prize
2 pursuant to this Section.
3 (Source: P.A. 85-1224.)
4 (20 ILCS 1605/13.1 new)
5 Sec. 13.1. Assignment of prizes.
6 (a) The right of a person to receive payments due under
7 a prize that is paid in installments over time by the
8 Department may be voluntarily assigned, in whole or in part,
9 if the assignment is made to a person or entity designated
10 pursuant to an order of a court of competent jurisdiction
11 located in the judicial district in which the assigning
12 winner resides or in which the Department's headquarters are
13 located.
14 A court may issue an order approving a voluntary
15 assignment and directing the Department to direct prize
16 payments in whole or in part to the designated assignee if
17 the court finds that all of the following conditions have
18 been met:
19 (1) The assignment is in writing, executed by the
20 assignor, and by its terms, subject to the laws of this
21 State.
22 (2) The purchase price being paid for the payments
23 being assigned represents a present value of the payments
24 being assigned, discounted at an annual rate that does
25 not exceed the State's usury limit on loans.
26 (3) The assignor provides a sworn affidavit
27 attesting that:
28 (A) the assigning winner is of sound mind, in
29 full command of his or her faculties, and not acting
30 under duress;
31 (B) the assigning winner has been advised
32 regarding the assignment by his or her own
33 independent legal counsel who is unrelated to and is
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1 not being compensated by the assignee or any of the
2 assignee's affiliates, and has received independent
3 financial or tax advice concerning the effects of
4 the assignment from a lawyer or other professional
5 who is unrelated to and is not being compensated by
6 the assignee or any of the assignee's affiliates;
7 (C) the assigning winner understands that he
8 or she will not receive the prize payments or
9 portions thereof for the years assigned;
10 (D) the assigning winner understands and
11 agrees that, with regard to the assigned payments,
12 the Department and its officials and employees will
13 have no further liability or responsibility to make
14 the assigned payments to the assignor;
15 (E) the assigning winner has been provided
16 with a one page written disclosure statement setting
17 forth in bold type, 14 point or larger the payments
18 being assigned, by amounts and payment dates; the
19 purchase price being paid, the rate of discount to
20 present value, assuming daily compounding and
21 funding on the contract date; and the amount, if
22 any, of any origination or closing fees that will be
23 charged to the assigning winner; and
24 (F) the assigning winner was advised in
25 writing, at the time he or she signed the assignment
26 contract, that he or she had the right to cancel the
27 contract without any further obligation within 3
28 business days following the date on which the
29 contract was signed.
30 Written notice of the proposed assignment and of the
31 court hearing concerning the proposed assignment is provided
32 to the Department's counsel at least 10 days prior to any
33 court hearing. The Department is not required to appear in or
34 be named as a party to any such action seeking judicial
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1 confirmation of an assignment under this Section, by may
2 intervene as of right in any such proceeding.
3 (b) A voluntary assignment shall not include or cover
4 payments or portions of payments that are subject to offset
5 on account of a defaulted or delinquent child support
6 obligation or on account of a debt owed to a State agency,
7 unless appropriate provision is made in the court order to
8 satisfy the obligations giving rise to the offset.
9 (c) The Department and its officials and employees shall
10 be discharged of all liability upon payment of an assigned
11 prize pursuant to an order entered under this Section.
12 (d) The Department may establish a reasonable fee to
13 defray administrative expenses associated with assignments
14 made pursuant to this Section, including the cost to the
15 Department of any processing fee that may be imposed by a
16 private annuity provider. The fee amount shall reflect the
17 direct and indirect costs associated with processing the
18 assignments.
19 (e) If at any time the Internal Revenue Service or a
20 court of competent jurisdiction issues a determination
21 letter, revenue ruling, other public ruling of the Internal
22 Revenue Service, or published decision to the Department or
23 to any or prize winner of any State lottery game declaring
24 that the voluntary assignment of prizes will affect the
25 federal income tax treatment of prize winners who do not
26 assign their prizes, the Director shall immediately file a
27 copy of that letter, ruling, or published decision with the
28 Secretary of State. A court may not issue an order
29 authorizing a voluntary assignment under this Section after
30 the date any such ruling, letter, or published decision is
31 filed. With regard to any prize paid over a course of years
32 in accordance with a schedule established by the Department
33 at the time of award, the Department shall not alter the
34 timing or amount of scheduled payments or otherwise
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1 accelerate, defer, commute, or discount such scheduled
2 payments.
3 (f) The Department shall promulgate rules to establish a
4 system of verifying the validity of tickets claimed to win
5 prizes and to effect payment of such prizes; however; the
6 right of any person to a prize, other than a prize that is
7 payable in installments over time, is not assignable.
8 However, any prize, to the extent that it has not already
9 been assigned or encumbered, may be paid to the estate of a
10 deceased prize winner or to a person designated pursuant to
11 an appropriate court order. A prize that is payable in
12 installments over time is assignable, but only pursuant to an
13 appropriate court order.
14 (g) Except as authorized under this Section, any person
15 who induces another to assign or transfer his or her right to
16 claim a prize, who offers for sale his or her right to claim
17 a prize, or who offers for compensation to claim the prize of
18 another is guilty of a Class A misdemeanor.
19 Section 99. Effective date. This Act takes effect upon
20 becoming law.