093_SB0689eng

 
SB689 Engrossed                      LRB093 09350 LRD 09584 b

 1        AN ACT in relation to gambling.

 2        Be it enacted by the People of  the  State  of  Illinois,
 3    represented in the General Assembly:

 4        Section  5.   The  Illinois  Lottery  Law  is  amended by
 5    changing Section 13 and adding Section 13.1 as follows:

 6        (20 ILCS 1605/13) (from Ch. 120, par. 1163)
 7        Sec. 13.  Except as otherwise provided in  Section  13.1,
 8    no  prize,  nor  any portion of a prize, nor any right of any
 9    person to a prize awarded shall be assignable.  Any prize, or
10    portion thereof remaining unpaid at  the  death  of  a  prize
11    winner,  may  be  paid  to  the estate of such deceased prize
12    winner, or to the trustee  under  a  revocable  living  trust
13    established by the deceased prize winner as settlor, provided
14    that  a  copy  of  such  a  trust  has  been  filed  with the
15    Department along with a notarized letter  of  direction  from
16    the  settlor  and  no  written  notice of revocation has been
17    received by the Department  prior  to  the  settlor's  death.
18    Following  such a settlor's death and prior to any payment to
19    such a successor trustee, the Director shall obtain from  the
20    trustee  and  each  trust  beneficiary a written agreement to
21    indemnify and hold the Department harmless  with  respect  to
22    any  claims  that  may  be  asserted  against  the Department
23    arising   from   payment   to   or   through    the    trust.
24    Notwithstanding  any  other  provision  of  this Section, any
25    person pursuant to an appropriate judicial order may be  paid
26    the  prize  to which a winner is entitled, and all or part of
27    any prize otherwise  payable  by  State  warrant  under  this
28    Section  shall  be  withheld  upon certification to the State
29    Comptroller from the Illinois Department  of  Public  Aid  as
30    provided  in Section 10-17.5 of The Illinois Public Aid Code.
31    The Director shall be discharged  of  all  further  liability
 
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 1    upon payment of a prize pursuant to this Section.
 2    (Source: P.A. 85-1224.)

 3        (20 ILCS 1605/13.1 new)
 4        Sec. 13.1.  Assignment of prizes payable in installments.
 5        (a)  The  right of any person to receive payments under a
 6    prize  that  is  paid  in  installments  over  time  by   the
 7    Department  may be voluntarily assigned, in whole or in part,
 8    if the assignment is made to a person  or  entity  designated
 9    pursuant  to  an  order  of a court of competent jurisdiction
10    located in the judicial district where  the  assigning  prize
11    winner resides or where the headquarters of the Department is
12    located.  A  court  may  issue an order approving a voluntary
13    assignment  and  directing  the  Department  to  make   prize
14    payments  in  whole or in part to the designated assignee, if
15    the court finds that all of  the  following  conditions  have
16    been met:
17             (1)  The  assignment  is  in writing, is executed by
18        the assignor, and is, by its terms, subject to  the  laws
19        of this State.
20             (2)  The  purchase price being paid for the payments
21        being assigned represents a present value of the payments
22        being assigned, discounted at an annual  rate  that  does
23        not exceed the State's limit for loans.
24             (3)  The   assignor   provides   a  sworn  affidavit
25        attesting that he or she:
26                  (i)  is of sound mind, is in  full  command  of
27             his  or  her  faculties,  and  is  not  acting under
28             duress;
29                  (ii)  has been advised regarding the assignment
30             by his or her own independent legal counsel, who  is
31             unrelated  to  and  is  not being compensated by the
32             assignee or any of the  assignee's  affiliates,  and
33             has  received  independent  financial  or tax advice
 
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 1             concerning the effects  of  the  assignment  from  a
 2             lawyer or other professional who is unrelated to and
 3             is  not  being compensated by the assignee or any of
 4             the assignee's affiliates;
 5                  (iii)  understands that  he  or  she  will  not
 6             receive  the  prize payments or portions thereof for
 7             the years assigned;
 8                  (iv)  understands and agrees that, with  regard
 9             to  the  assigned  payments,  the Department and its
10             officials  and  employees  will  have   no   further
11             liability  or  responsibility  to  make the assigned
12             payments to him or her;
13                  (v)  has been provided with a one-page  written
14             disclosure  statement setting forth, in bold type of
15             not  less  than  14  points,  the   payments   being
16             assigned, by amounts and payment dates; the purchase
17             price  being  paid;  the rate of discount to present
18             value, assuming daily compounding and funding on the
19             contract date;  and  the  amount,  if  any,  of  any
20             origination  or closing fees that will be charged to
21             him or her; and
22                  (vi)  was advised in writing, at the time he or
23             she signed the assignment contract, that he  or  she
24             had  the  right  to cancel the contract, without any
25             further obligation, within 3 business days following
26             the date on which the contract was signed.
27             (4)  Written notice of the proposed  assignment  and
28        any  court  hearing concerning the proposed assignment is
29        provided to the Department's counsel  at  least  10  days
30        prior  to  any  court  hearing.  The  Department  is  not
31        required  to appear in or be named as a party to any such
32        action seeking judicial  confirmation  of  an  assignment
33        under  this Section, but may intervene as of right in any
34        such proceeding.
 
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 1        (b)  A certified  copy  of  a  court  order  approving  a
 2    voluntary  assignment  must  be provided to the Department no
 3    later than 14 days before the date on which the payment is to
 4    be made.
 5        (c)  A voluntary assignment  may  not  include  or  cover
 6    payments  or  portions of payments that are subject to offset
 7    on  account  of  a  defaulted  or  delinquent  child  support
 8    obligation or on account of a debt owed to  a  State  agency.
 9    Each  court  order  issued under subsection (a) shall provide
10    that  any  delinquent  child  support  obligations   of   the
11    assigning  prize  winner and any debts owed to a State agency
12    by the assigning prize winner, as of the date  of  the  court
13    order,  shall  be  offset  by  the  Department  first against
14    remaining payments or portions thereof due the  prize  winner
15    and then against payments due the assignee.
16        (d)  The  Department  and  its  respective  officials and
17    employees shall be discharged of all liability  upon  payment
18    of an assigned prize under this Section.
19        (e)  The  Department  may  establish  a reasonable fee to
20    defray   any   administrative   expenses   associated    with
21    assignments  made  under  this Section, including the cost to
22    the Department of any processing fee that may be imposed by a
23    private annuity provider. The fee amount  shall  reflect  the
24    direct   and   indirect   costs  associated  with  processing
25    assignments.
26        (f)  If at any time the Internal  Revenue  Service  or  a
27    court   of  competent  jurisdiction  issues  a  determination
28    letter, revenue ruling, other public ruling of  the  Internal
29    Revenue  Service,  or published decision to the Department or
30    to any lottery prize  winner  declaring  that  the  voluntary
31    assignment  of  prizes  will  affect  the  federal income tax
32    treatment of prize winners who do not  assign  their  prizes,
33    the  Department shall immediately file a copy of that letter,
34    ruling, or published decision with the Secretary of State and
 
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 1    the Administrative Office of the Illinois Courts. A court may
 2    not issue an order authorizing a voluntary  assignment  under
 3    this  Section  after  the  date  any  such ruling, letter, or
 4    published decision is filed.