Illinois General Assembly - Full Text of Public Act 096-0753
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Public Act 096-0753




Public Act 096-0753
HB2557 Enrolled LRB096 09754 AMC 19917 b

    AN ACT concerning public employee benefits.
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
    Section 5. The Illinois Pension Code is amended by adding
Sections 1-113.20 and 1A-108.5 and by changing Section 15-167
as follows:
    (40 ILCS 5/1-113.20 new)
    Sec. 1-113.20. Investment strategies; explicit and
implicit costs. Every pension fund, retirement system, and
investment board created under this Code, except those whose
investments are restricted by Section 1-113.2 of this Code,
shall instruct the fund's, system's, or board's investment
advisors to utilize investment strategies designed to ensure
that all securities transactions are executed in such a manner
that the total explicit and implicit costs and total proceeds
in every transaction are the most favorable under the
    (40 ILCS 5/1A-108.5 new)
    Sec. 1A-108.5. Economic opportunity investments.
    (a) For the purposes of this Section:
    "Economic opportunity investment" means a qualified
investment, managed passively or actively by the pension fund,
that promotes economic development within the State of Illinois
by providing financially prudent investment opportunities in
or through the use of (a) Illinois businesses or (b)
Illinois-based projects that promote the economy of the State
or a region of the State, including without limitation
promotion of venture capital programs, coal and other natural
resource development, tourism development, infrastructure
development, real estate development, and job development
within the State of Illinois, while producing a competitive
rate of return commensurate with the risk of investment.
    "Illinois business" means a business, including an
investment adviser, that is headquartered in Illinois.
    "Illinois-based project" means an individual project of a
business, including the provision of products and investment
and other services to the pension fund, that will result in the
conduct of business within the State, the employment of
individuals within the State, or the acquisition of real
property located within the State.
    (b) It is the public policy of the State of Illinois to
encourage the pension funds, and any State entity investing
funds on behalf of pension funds, to promote the economy of
Illinois through the use of economic opportunity investments to
the greatest extent feasible within the bounds of financial and
fiduciary prudence.
    (c) Each pension fund, except pension funds created under
Articles 3 and 4 of this Code, shall submit a report to the
Governor and the General Assembly by September 1 of each year,
beginning in 2009, that identifies the economic opportunity
investments made by the fund, the primary location of the
business or project, the percentage of the fund's assets in
economic opportunity investments, and the actions that the fund
has undertaken to increase the use of economic opportunity
    (d) Pension funds created under Articles 2, 14, 15, 16, and
18 of this Act, and any State agency investing funds on behalf
of those pension funds, must make reasonable efforts to invest
in economic opportunity investments.
    (e) In making economic opportunity investments, trustees
and fiduciaries must comply with the relevant requirements and
restrictions set forth in Sections 1-109, 1-109.1, 1-109.2,
1-110, and 1-111 of this Code. Economic opportunity investments
that otherwise comply with this Code shall not be deemed
imprudent solely because they are investments in an Illinois
business or Illinois-based project.
    (40 ILCS 5/15-167)  (from Ch. 108 1/2, par. 15-167)
    Sec. 15-167. To invest money. To invest the funds of the
system, subject to the requirements and restrictions set forth
in Sections 1A-108.5, 1-109, 1-109.1, 1-109.2, 1-110, 1-111,
1-114, 1-115, and 15-158.2(d) of this Code and to invest in
real estate acquired by purchase, gift, condemnation or
otherwise, and any office building or buildings existing or to
be constructed thereon, including any additions thereto or
expansions thereof, for the use of the system. The board may
lease surplus space in any of the buildings and use rental
proceeds for operation, maintenance, improving, expanding and
furnishing of the buildings or for any other lawful system
    No bank or savings and loan association shall receive
investment funds as permitted by this Section, unless it has
complied with the requirements established pursuant to Section
6 of "An Act relating to certain investments of public funds by
public agencies", approved July 23, 1943, as now or hereafter
amended. The limitations set forth in such Section 6 shall be
applicable only at the time of investment and shall not require
the liquidation of any investment at any time.
    The board shall have the authority to enter into such
agreements and to execute such documents as it determines to be
necessary to complete any investment transaction.
    All investments shall be clearly held and accounted for to
indicate ownership by the board. The board may direct the
registration of securities in its own name or in the name of a
nominee created for the express purpose of registration of
securities by a national or state bank or trust company
authorized to conduct a trust business in the State of
    Investments shall be carried at cost or at a value
determined in accordance with generally accepted accounting
principles and accounting procedures approved by the Board.
    All additions to assets from income, interest, and
dividends from investments shall be used to pay benefits,
operating and administrative expenses of the system, debt
service, including any redemption premium, on any bonds issued
by the board, expenses incurred or deposits required in
connection with such bonds, and such other costs as may be
provided in accordance with this Article.
(Source: P.A. 90-19, eff. 6-20-97; 90-766, eff. 8-14-98.)
    Section 99. Effective date. This Act takes effect upon
becoming law.

Effective Date: 8/25/2009