Public Act 93-0465
SB689 Enrolled LRB093 09350 LRD 09584 b
AN ACT in relation to gambling.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Lottery Law is amended by
changing Section 13 and adding Section 13.1 as follows:
(20 ILCS 1605/13) (from Ch. 120, par. 1163)
Sec. 13. Except as otherwise provided in Section 13.1,
no prize, nor any portion of a prize, nor any right of any
person to a prize awarded shall be assignable. Any prize, or
portion thereof remaining unpaid at the death of a prize
winner, may be paid to the estate of such deceased prize
winner, or to the trustee under a revocable living trust
established by the deceased prize winner as settlor, provided
that a copy of such a trust has been filed with the
Department along with a notarized letter of direction from
the settlor and no written notice of revocation has been
received by the Department prior to the settlor's death.
Following such a settlor's death and prior to any payment to
such a successor trustee, the Director shall obtain from the
trustee and each trust beneficiary a written agreement to
indemnify and hold the Department harmless with respect to
any claims that may be asserted against the Department
arising from payment to or through the trust.
Notwithstanding any other provision of this Section, any
person pursuant to an appropriate judicial order may be paid
the prize to which a winner is entitled, and all or part of
any prize otherwise payable by State warrant under this
Section shall be withheld upon certification to the State
Comptroller from the Illinois Department of Public Aid as
provided in Section 10-17.5 of The Illinois Public Aid Code.
The Director shall be discharged of all further liability
upon payment of a prize pursuant to this Section.
(Source: P.A. 85-1224.)
(20 ILCS 1605/13.1 new)
Sec. 13.1. Assignment of prizes payable in installments.
(a) The right of any person to receive payments under a
prize that is paid in installments over time by the
Department may be voluntarily assigned, in whole or in part,
if the assignment is made to a person or entity designated
pursuant to an order of a court of competent jurisdiction
located in the judicial circuit where the assigning prize
winner resides or where the headquarters of the Department is
located. A court may issue an order approving a voluntary
assignment and directing the Department to make prize
payments in whole or in part to the designated assignee, if
the court finds that all of the following conditions have
been met:
(1) The assignment is in writing, is executed by
the assignor, and is, by its terms, subject to the laws
of this State.
(2) The purchase price being paid for the payments
being assigned represents a present value of the payments
being assigned, discounted at an annual rate that does
not exceed 10 percentage points over the Wall Street
Journal prime rate published on the business day prior to
the date of execution of the contract.
(3) The contract of assignment expressly states
that the assignor has 3 business days after the contract
was signed to cancel the assignment.
(4) The assignor provides a sworn affidavit
attesting that he or she:
(i) is of sound mind, is in full command of
his or her faculties, and is not acting under
duress;
(ii) has been advised regarding the assignment
by his or her own independent legal counsel, who is
unrelated to and is not being compensated by the
assignee or any of the assignee's affiliates, and
has received independent financial or tax advice
concerning the effects of the assignment from a
lawyer or other professional who is unrelated to and
is not being compensated by the assignee or any of
the assignee's affiliates;
(iii) understands that he or she will not
receive the prize payments or portions thereof for
the years assigned;
(iv) understands and agrees that, with regard
to the assigned payments, the Department and its
officials and employees will have no further
liability or responsibility to make the assigned
payments to him or her;
(v) has been provided with a one-page written
disclosure statement setting forth, in bold type of
not less than 14 points, the payments being
assigned, by amounts and payment dates; the purchase
price being paid; the rate of discount to present
value, assuming daily compounding and funding on the
contract date; and the amount, if any, of any
origination or closing fees that will be charged to
him or her; and
(vi) was advised in writing, at the time he or
she signed the assignment contract, that he or she
had the right to cancel the contract, without any
further obligation, within 3 business days following
the date on which the contract was signed.
(5) Written notice of the proposed assignment and
any court hearing concerning the proposed assignment is
provided to the Department's counsel at least 30 days
prior to any court hearing. The Department is not
required to appear in or be named as a party to any such
action seeking judicial confirmation of an assignment
under this Section, but may intervene as of right in any
such proceeding.
(b) A certified copy of a court order approving a
voluntary assignment must be provided to the Department no
later than 30 days before the date on which the payment is to
be made.
(c) A court order obtained pursuant to this Section,
together with all such prior orders, shall not require the
Department to divide any single prize payment among more than
3 different persons. Nothing in this Section shall prohibit
substituting assignees as long as there are no more than 3
assignees at any one time for any one prize payment.
(d) If a husband and wife are co-owners of a prize, any
assignment of the prize must be made jointly.
(e) A voluntary assignment may not include portions of
payments that are subject to offset on account of a defaulted
or delinquent child support obligation, non-wage garnishment,
or criminal restitution obligation or on account of a debt
owed to a State agency. Each court order issued under
subsection (a) shall provide that any delinquent child
support or criminal restitution obligations of the assigning
prize winner and any debts owed to a State agency by the
assigning prize winner, as of the date of the court order,
shall be set off by the Department first against remaining
payments or portions thereof due the prize winner and then
against payments due the assignee.
(f) The Department and its respective officials and
employees shall be discharged of all liability upon payment
of an assigned prize under this Section. The assignor and
assignee shall hold harmless and indemnify the Department,
the State of Illinois, and its employees and agents from all
claims, actions, suits, complaints, and liabilities related
to the assignment.
(g) The Department may establish a reasonable fee to
defray any administrative expenses associated with
assignments made under this Section, including the cost to
the Department of any processing fee that may be imposed by a
private annuity provider. The fee amount shall reflect the
direct and indirect costs associated with processing
assignments.
(h) If at any time the Internal Revenue Service or a
court of competent jurisdiction issues a determination
letter, revenue ruling, other public ruling of the Internal
Revenue Service, or published decision to the Department or
to any lottery prize winner declaring that the voluntary
assignment of prizes will affect the federal income tax
treatment of prize winners who do not assign their prizes,
the Department shall immediately file a copy of that letter,
ruling, or published decision with the Attorney General, the
Secretary of State, and the Administrative Office of the
Illinois Courts. A court may not issue an order authorizing a
voluntary assignment under this Section after the date any
such ruling, letter, or published decision is filed.
(i) A contract of assignment in which the assignor is a
lottery winner shall include a sworn affidavit from the
assignee. The form of the affidavit shall be established by
the Department and shall include:
(1) a summary of assignee contacts with the winner;
(2) a summary of any lawsuits, claims, and other
legal actions from lottery winners regarding conduct of
the assignee or its agents;
(3) a statement that the assignee is in good
standing in its state of domicile and with any other
licensing or regulatory agency as may be required in the
conduct of its business;
(4) a brief business history of the assignee;
(5) a statement describing the nature of the
business of the assignee; and
(6) a statement of the assignee's privacy and
non-harassment policies and express affirmation that the
assignee has followed those policies in Illinois.
(j) The assignee shall notify the Department of its
business location and mailing address for payment purposes
during the entire course of the assignment.