Bill Text: IL SB1292 | 2009-2010 | 96th General Assembly | Engrossed

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Bill Title: Amends the Illinois Pension Code. Requires each retirement system to establish a policy with the goal of increasing the racial, ethnic, and gender diversity of its fiduciaries, update the goals annually, and submit a report to the Governor and General Assembly by September 1 of each year.

Spectrum: Partisan Bill (Democrat 4-0)

Status: (Passed) 2009-07-15 - Public Act . . . . . . . . . 96-0043 [SB1292 Detail]

Download: Illinois-2009-SB1292-Engrossed.html

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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 changing
Section 1-109.1 as follows:
(40 ILCS 5/1-109.1) (from Ch. 108 1/2, par. 1-109.1)
Sec. 1-109.1. Allocation and Delegation of Fiduciary
Duties.
(1) Subject to the provisions of Section 22A-113 of this
Code and subsections (2) and (3) of this Section, the board of
trustees of a retirement system or pension fund established
under this Code may:
(a) Appoint one or more investment managers as
fiduciaries to manage (including the power to acquire and
dispose of) any assets of the retirement system or pension
fund; and
(b) Allocate duties among themselves and designate
others as fiduciaries to carry out specific fiduciary
activities other than the management of the assets of the
retirement system or pension fund.
(2) The board of trustees of a pension fund established
under Article 5, 6, 8, 9, 10, 11, 12 or 17 of this Code may not
transfer its investment authority, nor transfer the assets of

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the fund to any other person or entity for the purpose of
consolidating or merging its assets and management with any
other pension fund or public investment authority, unless the
board resolution authorizing such transfer is submitted for
approval to the contributors and pensioners of the fund at
elections held not less than 30 days after the adoption of such
resolution by the board, and such resolution is approved by a
majority of the votes cast on the question in both the
contributors election and the pensioners election. The
election procedures and qualifications governing the election
of trustees shall govern the submission of resolutions for
approval under this paragraph, insofar as they may be made
applicable.
(3) Pursuant to subsections (h) and (i) of Section 6 of
Article VII of the Illinois Constitution, the investment
authority of boards of trustees of retirement systems and
pension funds established under this Code is declared to be a
subject of exclusive State jurisdiction, and the concurrent
exercise by a home rule unit of any power affecting such
investment authority is hereby specifically denied and
preempted.
(4) For the purposes of this Code, "emerging investment
manager" means a qualified investment adviser that manages an
investment portfolio of at least $10,000,000 but less than
$2,000,000,000 and is a "minority owned business" or "female
owned business" as those terms are defined in the Business

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Enterprise for Minorities, Females, and Persons with
Disabilities Act.
It is hereby declared to be the public policy of the State
of Illinois to encourage the trustees of public employee
retirement systems to use emerging investment managers in
managing their system's assets encompassing all asset classes
and brokerage to the greatest extent feasible within the bounds
of financial and fiduciary prudence, and to take affirmative
steps to remove any barriers to the full participation of
emerging investment managers in investment opportunities
afforded by those retirement systems.
Each retirement system subject to this Code shall prepare a
report to be submitted to the Governor and the General Assembly
by September 1 of each year. The report shall identify the
emerging investment managers used by the system, the percentage
of the system's assets under the investment control of emerging
investment managers, and the actions it has undertaken to
increase the use of emerging investment managers, including
encouraging other investment managers to use emerging
investment managers as subcontractors when the opportunity
arises.
The use of an emerging investment manager does not
constitute a transfer of investment authority for the purposes
of subsection (2) of this Section.
(5) Each retirement system subject to this Code shall
establish a policy with the goal of increasing the racial,

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ethnic, and gender diversity of its fiduciaries, including its
consulting and senior staff. Goals shall be updated annually,
with each retirement system preparing a report to be submitted
to the Governor and the General Assembly by September 1 of each
year.
(Source: P.A. 94-471, eff. 8-4-05.)