Bill Text: IL SB1644 | 2023-2024 | 103rd General Assembly | Introduced

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Bill Title: Amends the Deferred Compensation Article of the Illinois Pension Code. Provides that as soon as practicable, but no later than January 1, 2025, the Department of Central Management Services shall automatically enroll into the State Employees Deferred Compensation Plan all current State employees who are active members of a retirement system created under the General Assembly, State Employees, or Judges Article and who are not contributing to the Plan on the date of automatic enrollment. Provides that any agency with employees subject to automatic enrollment must systematically provide the employee data necessary for enrollment to the Department of Central Management Services or its designee. Provides that an employee who is automatically enrolled shall have 3% of his or her pretax gross compensation, or any other percentage determined by the Illinois State Board of Investment, for each compensation period deferred into his or her deferred compensation account. Provides that the Illinois State Board of Investment may increase the default percentage amount of compensation deferred into employee accounts. Contains provisions concerning opting out of automatic enrollment; increasing or reducing contributions; and withdrawing from the Plan. Makes other changes. Effective July 1, 2023.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Failed) 2025-01-07 - Session Sine Die [SB1644 Detail]

Download: Illinois-2023-SB1644-Introduced.html

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103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1644 Introduced 2/8/2023, by Sen. Robert F. Martwick SYNOPSIS AS INTRODUCED:
40 ILCS 5/24-105.2
40 ILCS 5/24-105.3 new
Amends the Deferred Compensation Article of the Illinois Pension Code. Provides that as soon as practicable, but no later than January 1, 2025, the Department of Central Management Services shall automatically enroll into the State Employees Deferred Compensation Plan all current State employees who are active members of a retirement system created under the General Assembly, State Employees, or Judges Article and who are not contributing to the Plan on the date of automatic enrollment. Provides that any agency with employees subject to automatic enrollment must systematically provide the employee data necessary for enrollment to the Department of Central Management Services or its designee. Provides that an employee who is automatically enrolled shall have 3% of his or her pretax gross compensation, or any other percentage determined by the Illinois State Board of Investment, for each compensation period deferred into his or her deferred compensation account. Provides that the Illinois State Board of Investment may increase the default percentage amount of compensation deferred into employee accounts. Contains provisions concerning opting out of automatic enrollment; increasing or reducing contributions; and withdrawing from the Plan. Makes other changes. Effective July 1, 2023.
LRB103 27809 RPS 54187 b
A BILL FOR
SB1644 LRB103 27809 RPS 54187 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
changing Section 24-105.2 and adding Section 24-105.3 as
follows:
(40 ILCS 5/24-105.2)
Sec. 24-105.2. Automatic enrollment for certain employees.
The Department of Central Management Services shall
automatically enroll in the State Employees Deferred
Compensation Plan any employee who, on or after July 1, 2020,
becomes an active member or participant of a retirement system
created under Article 2, 14, or 18. Any agency with employees
subject to automatic enrollment must systematically provide
the employee data necessary for enrollment to the Department
of Central Management Services or its designee. An employee
automatically enrolled under this Section shall have 3% of his
or her pre-tax gross compensation for each compensation period
deferred into his or her deferred compensation account. The
Board may increase the default percentage amount of
compensation deferred into employee accounts.
An employee shall have 30 days from the start date of
employment to elect to not participate in the deferred

SB1644 - 2 - LRB103 27809 RPS 54187 b
compensation plan or to elect to increase or reduce the amount
of pre-tax gross compensation deferred. An employee shall be
automatically enrolled in the Plan beginning the first day of
the pay period following the employee's thirtieth day of
employment. An employee who has been automatically enrolled in
the Plan may elect, within 90 days of enrollment, to withdraw
from the Plan and receive a refund of amounts deferred, plus or
minus any applicable earnings, investment fees, and
administrative fees. An employee making such an election shall
forfeit all employer matching contributions, if any, made
prior to the election. Any refunded amount shall be included
in the employee's gross income for the taxable year in which
the refund is issued.
As soon as practicable, the Board shall establish a plan
for annual, automatic increases to employee contribution rates
for employees who are automatically enrolled in the Plan
pursuant to this Section. The amount of automatic annual
increases in any 12-month period shall not exceed 1% of
compensation. Employees may elect to not receive automatic
annual increases in a manner described by the Board.
(Source: P.A. 101-277, eff. 1-1-20; 102-219, eff. 7-30-21.)
(40 ILCS 5/24-105.3 new)
Sec. 24-105.3. One-time automatic enrollment for certain
employees. As soon as practicable, but no later than January
1, 2025, the Department of Central Management Services shall

SB1644 - 3 - LRB103 27809 RPS 54187 b
automatically enroll into the State Employees Deferred
Compensation Plan all current State employees who are active
members of a retirement system created under Article 2, 14, or
18 and who are not contributing to the Plan on the date of
automatic enrollment under this Section. Any agency with
employees subject to automatic enrollment must systematically
provide the employee data necessary for enrollment to the
Department of Central Management Services or its designee. An
employee automatically enrolled under this Section shall have
3%, or any other percentage determined by the Board pursuant
to Section 24-105.2, of his or her pretax gross compensation
for each compensation period deferred into his or her deferred
compensation account.
An employee shall have a one-calendar-month opt-out period
prior to being automatically enrolled in the Plan, during
which the employee may elect to not participate in the Plan or
elect to increase or reduce the amount of pretax gross
compensation deferred. An employee who does not opt out during
the one-calendar-month period shall be automatically enrolled
in the Plan beginning the first day of the pay period of the
month following the end of the opt-out period. An employee who
has been automatically enrolled in the Plan may elect, within
90 days after enrollment, to withdraw from the Plan and
receive a refund of the amounts deferred, plus or minus any
applicable earnings, investment fees, and administrative fees.
An employee making such an election shall forfeit all employer

SB1644 - 4 - LRB103 27809 RPS 54187 b
matching contributions, if any, made prior to the election.
Any refunded amount shall be included in the employee's gross
income for the taxable year in which the refund is issued.
Beginning one year after the date of automatic enrollment
under this Section, or as soon as practicable thereafter, the
Board shall establish a plan for automatic increases to
employee contribution rates for employees who are
automatically enrolled in the Plan pursuant to this Section.
The amount of automatic increases in any 12-month period shall
not exceed 1% of compensation. Employees may elect to not
receive automatic increases in a manner described by the
Board.
Section 99. Effective date. This Act takes effect July 1,
2023.