HB1293 EnrolledLRB102 03303 RJF 13316 b

1    AN ACT concerning government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4
Article 1.

 
5    Section 1-1. Findings.
6    (a) The General Assembly finds that:
7        (1) Russia launched an unprecedented military assault
8    on Ukraine that has left many dead, and the fighting in
9    Ukraine appears to be some of the worst conventional
10    warfare Europe has seen since World War II and the
11    conflicts in the Balkans in the 1990s;
12        (2) Western leaders have been united in their swift
13    and strong condemnation of Russia's military action;
14        (3) President Biden has stated that Russian President
15    Putin had "committed an assault on the very principles
16    that uphold the global peace", and the United States has,
17    as a result, taken steps to impose harsh, new sanctions
18    that are intended to punish President Putin for his
19    actions;
20        (4) Secretary of State Blinken has indicated that
21    there are credible reports that Russia has engaged in
22    actions during its military assault on Ukraine that
23    constitute war crimes under international law;

 

 

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1        (5) Russia has used, during its military assault on
2    Ukraine, weapons that have been banned by many countries,
3    including cluster munitions;
4        (6) Russia has conducted direct attacks on major
5    nuclear power facilities in Ukraine, which could lead to
6    disaster and the spread of radioactive contamination
7    across Ukraine and Europe;
8        (7) the United Nations has estimated that more than
9    14,000,000 Ukrainians have already been displaced within
10    the country and more than 7,000,000 have left the country
11    as a result of the Russian invasion;
12        (8) the international community is making preparations
13    to meet the humanitarian needs of those refugees who are
14    displaced by this conflict;
15        (9) Central Europe is welcoming Ukrainians, but the
16    countries in that region are not currently equipped to
17    handle the volume of refugees that are anticipated to
18    arrive at their borders in the coming weeks, and European
19    and U.S. leadership must help build that capacity; and
20        (10) Illinois is a welcoming state to refugees and
21    immigrants and home to a robust community of Ukrainian
22    immigrants and Ukrainian descendants, many of whom live in
23    Chicago's Ukrainian Village neighborhood.
24    (b) For these reasons, the General Assembly urges:
25        (1) the pension funds and retirement systems
26    established under the Illinois Pension Code to divest

 

 

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1    their holdings in any companies that are domiciled in
2    Russia or Belarus and that are on the list of restricted
3    companies developed by the Illinois Investment Policy
4    Board;
5        (2) all municipalities to reconsider any sister-city
6    relationships they may have with cities in Russia; and
7        (3) the United States Department of State to resettle
8    Ukrainian refugees in Illinois.
 
9
Article 5.

 
10    Section 5-1. Short title. This Article may be cited as the
11Money Laundering in Real Estate Task Force Act. References in
12this Article to "this Act" mean this Article.
 
13    Section 5-3. Findings. The General Assembly finds and
14declares the following:
15        (1) the United States Department of Treasury's
16    Financial Crimes Enforcement Network found, in 2017, that
17    30% of all high-end real estate purchases in major
18    metropolitan areas involved beneficial owners or
19    purchasers who were the subject of previous suspicious
20    activity reports;
21        (2) the United States, unlike Canada and several other
22    jurisdictions, does not require real estate agents and
23    brokers to file suspicious transaction reports;

 

 

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1        (3) the lack of beneficial ownership transparency is
2    an important factor in facilitating money laundering in
3    real estate; and
4        (4) money laundering in real estate has negative
5    consequences for local communities, including the
6    dislocation of residents from and within major
7    metropolitan areas.
 
8    Section 5-5. Money Laundering in Real Estate Task Force.
9    (a) The Money Laundering in Real Estate Task Force is
10created. The Task Force shall consist of the following
11members:
12        (1) 4 members appointed one each by the Speaker of the
13    House of Representatives, the Minority Leader of the House
14    of Representatives, the President of the Senate, and the
15    Minority Leader of the Senate;
16        (2) the Secretary of Financial and Professional
17    Regulation or the Secretary's designee;
18        (3) the Director of Revenue or the Director's
19    designee;
20        (4) 2 members of the faculty of an institution of
21    higher education in the State with subject matter
22    expertise regarding money laundering in real estate,
23    appointed by the Governor;
24        (5) one expert on real estate tax law, appointed by
25    the Governor;

 

 

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1        (6) one representative of banking institutions with
2    assets of at least $1,000,000,000, appointed by the
3    Governor;
4        (7) one representative of banking institutions with
5    assets below $1,000,000,000, appointed by the Governor;
6        (8) 2 representatives of a statewide organization
7    representing real estate brokers, appointed by the
8    Governor; and
9        (9) 4 members with backgrounds in real estate,
10    financial institutions, or law, appointed one each by the
11    Speaker of the House of Representatives, the Minority
12    Leader of the House of Representatives, the President of
13    the Senate, and the Minority Leader of the Senate.
14    (b) Initial appointments to the Task Force shall be made
15as soon as practicable after the effective date of this Act.
16The Task Force shall hold its first meeting within a
17reasonable period of time after its members have been
18appointed and shall convene regularly to carry out its duties
19and submit the reports required under this Act. At its first
20meeting, the Task Force shall elect its chairperson and any
21other officers from among its members.
22    (c) The Department of Financial and Professional
23Regulation and the Department of Revenue shall provide
24administrative and other support to the Task Force.
 
25    Section 5-10. Duties. The Task Force shall:

 

 

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1        (1) identify vulnerabilities in the real estate sector
2    that facilitate money laundering;
3        (2) provide guidance to help actors in the real estate
4    sector identify suspicious transactions and report them to
5    the proper authorities;
6        (3) explore the means by which illicit money is
7    channeled into the real estate sector and integrated into
8    the legal economy, including, but not limited to, cash
9    purchases, complex loans, monetary instruments, mortgages,
10    investment institutions, fraudulent appraisals, and
11    anonymous corporate entities;
12        (4) assess the exposure of the residential,
13    industrial, and commercial real estate sectors in Illinois
14    to illicit Russian money, including, but not limited to,
15    luxury real estate in Chicago and nonresidential real
16    estate in downstate communities; and
17        (5) assess real estate due diligence and reporting
18    practices, requirements, and laws in Illinois and
19    recommend changes needed to eliminate systemic
20    vulnerabilities that facilitate foreign money laundering.
 
21    Section 5-15. Reports. The Task Force shall submit a
22report to the Governor and the General Assembly not later than
2312 months after the effective date of this Act. The report
24shall include the Task Force's findings and shall summarize
25the actions the Task Force has taken and those it intends to

 

 

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1take in response to its obligations under the Act. After it
2submits its initial report, the Task Force shall periodically
3submit reports to the Governor and the General Assembly as the
4chairperson of the Task Force deems necessary to apprise those
5officials of any additional findings made or actions taken by
6the Task Force. The obligation of the Task Force to submit
7periodic reports shall continue for the duration of the Task
8Force.
 
9    Section 5-20. Dissolution of Task Force; repeal. The Task
10Force is dissolved on January 1, 2025. This Act is repealed on
11January 1, 2026.
 
12
Article 10.

 
13    Section 10-5. The Illinois Administrative Procedure Act is
14amended by adding Section 5-45.35 as follows:
 
15    (5 ILCS 100/5-45.35 new)
16    Sec. 5-45.35. Emergency rulemaking; Refugee Resettlement
17Program. To ensure the availability of refugee resettlement
18program services in the case of an imminent, large-scale
19refugee resettlement event, emergency rules may be adopted in
20accordance with Section 5-45 by the Department of Human
21Services. The adoption of emergency rules authorized by
22Section 5-45 and this Section is deemed to be necessary for the

 

 

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1public interest, safety, and welfare.
2    This Section is repealed one year after the effective date
3of this amendatory Act of the 102nd General Assembly.
 
4    Section 10-7. The Election Code is amended by adding
5Section 1-22 as follows:
 
6    (10 ILCS 5/1-22 new)
7    Sec. 1-22. The Illinois Elections and Infrastructure
8Integrity Task Force.
9    (a) The Illinois Elections and Infrastructure Integrity
10Task Force is created. The Task Force shall consist of the
11following members:
12        (1) 4 members appointed one each by the Speaker of the
13    House of Representatives, the Minority Leader of the House
14    of Representatives, the President of the Senate, and the
15    Minority Leader of the Senate;
16        (2) one member with subject matter expertise regarding
17    cybersecurity, appointed by the Minority Leader of the
18    House of Representatives;
19        (3) one member with subject matter expertise regarding
20    voting technology or election integrity, appointed by the
21    Speaker of the House;
22        (4) one member who is an individual with current
23    experience in operational cybersecurity, preferably
24    international operational cybersecurity, appointed by the

 

 

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1    President of the Senate;
2        (5) one county clerk, appointed by the Minority Leader
3    of the Senate;
4        (6) the Chair of the Board of Election Commissioners
5    for the City of Chicago or the Chair's designee;
6        (7) the county clerk of Cook County;
7        (8) one election administrator, appointed by the
8    Governor;
9        (9) the Executive Director of the State Board of
10    Elections or the Executive Director's designee;
11        (10) the Secretary of State or the Secretary's
12    designee;
13        (11) the Director of the Illinois Emergency Management
14    Agency or the Director's designee;
15        (12) the Secretary of Innovation and Technology or the
16    Secretary's designee; and
17        (13) the Attorney General or the Attorney General's
18    designee.
19    (b) The Task Force shall evaluate and make recommendations
20to prepare for and prevent foreign interference in elections
21in advance of the 2024 election and all future elections in the
22State and to prepare for and prevent potential cyberattacks on
23State infrastructure. In carrying out its duties, the Task
24Force shall prioritize the security of all Illinois residents
25and cooperation with other states and with law enforcement to
26protect United States national sovereignty. The Task Force

 

 

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1shall submit a report containing its findings and
2recommendations to the Governor and the General Assembly not
3later than January 1, 2024. The Task Force shall also submit a
4report evaluating the 2024 election to the Governor and the
5General Assembly not later than March 1, 2025.
6    (c) The State Board of Elections shall provide staff and
7administrative support to the Task Force.
8    (d) The Task Force is dissolved, and this Section is
9repealed, on June 1, 2025.
 
10    Section 10-10. The Deposit of State Moneys Act is amended
11by adding Section 22.7 as follows:
 
12    (15 ILCS 520/22.7 new)
13    Sec. 22.7. Russian or Belarusian investments prohibited.
14Notwithstanding any provision of law to the contrary, the
15State Treasurer shall not invest State money in Russian or
16Belarusian sovereign debt, Russian or Belarusian
17government-backed securities, any investment instrument issued
18by an entity that is domiciled or has its principal place of
19business in Russia or Belarus, or any investment instrument
20issued by a company that is subject to Russian Harmful Foreign
21Activities Sanctions, as that term is defined under Section
221-110.16 of the Illinois Pension Code, and shall not invest or
23deposit State money in any bank that is domiciled or has its
24principal place of business in Russia or Belarus or in any

 

 

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1other financial institution that is domiciled or has its
2principal place of business in Russia or Belarus or that is
3subject to Russian Harmful Foreign Activities Sanctions.
 
4    Section 10-20. The Illinois State Police Law of the Civil
5Administrative Code of Illinois is amended by changing Section
62605-35 as follows:
 
7    (20 ILCS 2605/2605-35)  (was 20 ILCS 2605/55a-3)
8    Sec. 2605-35. Division of Criminal Investigation.
9    (a) The Division of Criminal Investigation shall exercise
10the following functions and those in Section 2605-30:
11        (1) Exercise the rights, powers, and duties vested by
12    law in the Illinois State Police by the Illinois Horse
13    Racing Act of 1975, including those set forth in Section
14    2605-215.
15        (2) Investigate the origins, activities, personnel,
16    and incidents of crime and enforce the criminal laws of
17    this State related thereto.
18        (3) Enforce all laws regulating the production, sale,
19    prescribing, manufacturing, administering, transporting,
20    having in possession, dispensing, delivering,
21    distributing, or use of controlled substances and
22    cannabis.
23        (4) Cooperate with the police of cities, villages, and
24    incorporated towns and with the police officers of any

 

 

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1    county in enforcing the laws of the State and in making
2    arrests and recovering property.
3        (5) Apprehend and deliver up any person charged in
4    this State or any other state with treason or a felony or
5    other crime who has fled from justice and is found in this
6    State.
7        (6) Investigate recipients and providers under the
8    Illinois Public Aid Code and any personnel involved in the
9    administration of the Code who are suspected of any
10    violation of the Code pertaining to fraud in the
11    administration, receipt, or provision of assistance and
12    pertaining to any violation of criminal law; and exercise
13    the functions required under Section 2605-220 in the
14    conduct of those investigations.
15        (7) Conduct other investigations as provided by law.
16        (8) Investigate public corruption.
17        (9) Exercise other duties that may be assigned by the
18    Director in order to fulfill the responsibilities and
19    achieve the purposes of the Illinois State Police, which
20    may include the coordination of gang, terrorist, and
21    organized crime prevention, control activities, and
22    assisting local law enforcement in their crime control
23    activities.
24        (10) Conduct investigations (and cooperate with
25    federal law enforcement agencies in the investigation) of
26    any property-related crimes, such as money laundering,

 

 

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1    involving individuals or entities listed on the sanctions
2    list maintained by the U.S. Department of Treasury's
3    Office of Foreign Asset Control.
4    (b) (Blank).
5(Source: P.A. 102-538, eff. 8-20-21; 102-813, eff. 5-13-22.)
 
6    Section 10-30. The Public Funds Investment Act is amended
7by adding Section 2.3 as follows:
 
8    (30 ILCS 235/2.3 new)
9    Sec. 2.3. Russian or Belarusian investments prohibited.
10Notwithstanding any provision of law to the contrary, a public
11agency shall not invest public funds in Russian or Belarusian
12sovereign debt, Russian or Belarusian government-backed
13securities, any investment instrument issued by an entity that
14is domiciled or has its principal place of business in Russia
15or Belarus, or any investment instrument issued by a company
16that is subject to Russian Harmful Foreign Activities
17Sanctions, as that term is defined under Section 1-110.16 of
18the Illinois Pension Code, and shall not invest or deposit
19public funds in any bank that is domiciled or has its principal
20place of business in Russia or Belarus or in any other
21financial institution that is domiciled or has its principal
22place of business in Russia or Belarus or that is subject to
23Russian Harmful Foreign Activities Sanctions.
 

 

 

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1    Section 10-35. The Illinois Pension Code is amended by
2changing Section 1-110.16 as follows:
 
3    (40 ILCS 5/1-110.16)
4    Sec. 1-110.16. Transactions prohibited by retirement
5systems; companies that boycott Israel, for-profit companies
6that contract to shelter migrant children, Iran-restricted
7companies, Sudan-restricted companies, and expatriated
8entities, companies that are domiciled or have their principal
9place of business in Russia or Belarus, and companies that are
10subject to Russian Harmful Foreign Activities Sanctions.
11    (a) As used in this Section:
12        "Boycott Israel" means engaging in actions that are
13    politically motivated and are intended to penalize,
14    inflict economic harm on, or otherwise limit commercial
15    relations with the State of Israel or companies based in
16    the State of Israel or in territories controlled by the
17    State of Israel.
18        "Company" means any sole proprietorship, organization,
19    association, corporation, partnership, joint venture,
20    limited partnership, limited liability partnership,
21    limited liability company, or other entity or business
22    association, including all wholly owned subsidiaries,
23    majority-owned subsidiaries, parent companies, or
24    affiliates of those entities or business associations,
25    that exist for the purpose of making profit.

 

 

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1        "Company that is subject to Russian Harmful Foreign
2    Activities Sanctions" means a company that is subject to
3    sanctions under the Russian Harmful Foreign Activities
4    Sanctions Regulations (31 CFR Part 587), any Presidential
5    Executive Order imposing sanctions against Russia, or any
6    federal directive issued pursuant to any such Executive
7    Order.
8        "Contract to shelter migrant children" means entering
9    into a contract with the federal government to shelter
10    migrant children under the federal Unaccompanied Alien
11    Children Program or a substantially similar federal
12    program.
13        "Illinois Investment Policy Board" means the board
14    established under subsection (b) of this Section.
15        "Direct holdings" in a company means all publicly
16    traded securities of that company that are held directly
17    by the retirement system in an actively managed account or
18    fund in which the retirement system owns all shares or
19    interests.
20        "Expatriated entity" has the meaning ascribed to it in
21    Section 1-15.120 of the Illinois Procurement Code.
22        "Illinois Investment Policy Board" means the board
23    established under subsection (b) of this Section.
24        "Indirect holdings" in a company means all securities
25    of that company that are held in an account or fund, such
26    as a mutual fund, managed by one or more persons not

 

 

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1    employed by the retirement system, in which the retirement
2    system owns shares or interests together with other
3    investors not subject to the provisions of this Section or
4    that are held in an index fund.
5        "Iran-restricted company" means a company that meets
6    the qualifications under Section 1-110.15 of this Code.
7        "Private market fund" means any private equity fund,
8    private equity funds of funds, venture capital fund, hedge
9    fund, hedge fund of funds, real estate fund, or other
10    investment vehicle that is not publicly traded.
11        "Restricted companies" means companies that boycott
12    Israel, for-profit companies that contract to shelter
13    migrant children, Iran-restricted companies,
14    Sudan-restricted companies, and expatriated entities,
15    companies that are domiciled or have their principal place
16    of business in Russia or Belarus, and companies that are
17    subject to Russian Harmful Foreign Activities Sanctions.
18        "Retirement system" means a retirement system
19    established under Article 2, 14, 15, 16, or 18 of this Code
20    or the Illinois State Board of Investment.
21        "Sudan-restricted company" means a company that meets
22    the qualifications under Section 1-110.6 of this Code.
23    (b) There shall be established an Illinois Investment
24Policy Board. The Illinois Investment Policy Board shall
25consist of 7 members. Each board of a pension fund or
26investment board created under Article 15, 16, or 22A of this

 

 

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1Code shall appoint one member, and the Governor shall appoint
24 members. The Governor shall designate one member of the
3Board as the Chairperson.
4    (b-5) The term of office of each member appointed by the
5Governor, who is serving on the Board on June 30, 2022, is
6abolished on that date. The terms of office of members
7appointed by the Governor after June 30, 2022 shall be as
8follows: 2 initial members shall be appointed for terms of 2
9years, and 2 initial members shall be appointed for terms of 4
10years. Thereafter, the members appointed by the Governor shall
11hold office for 4 years, except that any member chosen to fill
12a vacancy occurring otherwise than by expiration of a term
13shall be appointed only for the unexpired term of the member
14whom he or she shall succeed. Board members may be
15reappointed. The Governor may remove a Governor's appointee to
16the Board for incompetence, neglect of duty, malfeasance, or
17inability to serve.
18    (c) Notwithstanding any provision of law to the contrary,
19beginning January 1, 2016, Sections 1-110.15 110.15 and
201-110.6 of this Code shall be administered in accordance with
21this Section.
22    (d) By April 1, 2016, the Illinois Investment Policy Board
23shall make its best efforts to identify all Iran-restricted
24companies, Sudan-restricted companies, and companies that
25boycott Israel and assemble those identified companies into a
26list of restricted companies, to be distributed to each

 

 

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1retirement system.
2    These efforts shall include the following, as appropriate
3in the Illinois Investment Policy Board's judgment:
4        (1) reviewing and relying on publicly available
5    information regarding Iran-restricted companies,
6    Sudan-restricted companies, and companies that boycott
7    Israel, including information provided by nonprofit
8    organizations, research firms, and government entities;
9        (2) contacting asset managers contracted by the
10    retirement systems that invest in Iran-restricted
11    companies, Sudan-restricted companies, and companies that
12    boycott Israel;
13        (3) contacting other institutional investors that have
14    divested from or engaged with Iran-restricted companies,
15    Sudan-restricted companies, and companies that boycott
16    Israel; and
17        (4) retaining an independent research firm to identify
18    Iran-restricted companies, Sudan-restricted companies,
19    and companies that boycott Israel.
20    The Illinois Investment Policy Board shall review the list
21of restricted companies on a quarterly basis based on evolving
22information from, among other sources, those listed in this
23subsection (d) and distribute any updates to the list of
24restricted companies to the retirement systems and the State
25Treasurer.
26    By April 1, 2018, the Illinois Investment Policy Board

 

 

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1shall make its best efforts to identify all expatriated
2entities and include those companies in the list of restricted
3companies distributed to each retirement system and the State
4Treasurer. These efforts shall include the following, as
5appropriate in the Illinois Investment Policy Board's
6judgment:
7        (1) reviewing and relying on publicly available
8    information regarding expatriated entities, including
9    information provided by nonprofit organizations, research
10    firms, and government entities;
11        (2) contacting asset managers contracted by the
12    retirement systems that invest in expatriated entities;
13        (3) contacting other institutional investors that have
14    divested from or engaged with expatriated entities; and
15        (4) retaining an independent research firm to identify
16    expatriated entities.
17    By July 1, 2022, the Illinois Investment Policy Board
18shall make its best efforts to identify all for-profit
19companies that contract to shelter migrant children and
20include those companies in the list of restricted companies
21distributed to each retirement system. These efforts shall
22include the following, as appropriate in the Illinois
23Investment Policy Board's judgment:
24        (1) reviewing and relying on publicly available
25    information regarding for-profit companies that contract
26    to shelter migrant children, including information

 

 

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1    provided by nonprofit organizations, research firms, and
2    government entities;
3        (2) contacting asset managers contracted by the
4    retirement systems that invest in for-profit companies
5    that contract to shelter migrant children;
6        (3) contacting other institutional investors that have
7    divested from or engaged with for-profit companies that
8    contract to shelter migrant children; and
9        (4) retaining an independent research firm to identify
10    for-profit companies that contract to shelter migrant
11    children.
12    No later than 6 months after the effective date of this
13amendatory Act of the 102nd General Assembly, the Illinois
14Investment Policy Board shall make its best efforts to
15identify all companies that are domiciled or have their
16principal place of business in Russia or Belarus and companies
17that are subject to Russian Harmful Foreign Activities
18Sanctions and include those companies in the list of
19restricted companies distributed to each retirement system.
20These efforts shall include the following, as appropriate in
21the Illinois Investment Policy Board's judgment:
22        (1) reviewing and relying on publicly available
23    information regarding companies that are domiciled or have
24    their principal place of business in Russia or Belarus and
25    companies that are subject to Russian Harmful Foreign
26    Activities Sanctions, including information provided by

 

 

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1    nonprofit organizations, research firms, and government
2    entities;
3        (2) contacting asset managers contracted by the
4    retirement systems that invest in companies that are
5    domiciled or have their principal place of business in
6    Russia or Belarus and companies that are subject to
7    Russian Harmful Foreign Activities Sanctions;
8        (3) contacting other institutional investors that have
9    divested from or engaged with companies that are domiciled
10    or have their principal place of business in Russia or
11    Belarus and companies that are subject to Russian Harmful
12    Foreign Activities Sanctions; and
13        (4) retaining an independent research firm to identify
14    companies that are domiciled or have their principal place
15    of business in Russia or Belarus and companies that are
16    subject to Russian Harmful Foreign Activities Sanctions.
17    (e) The Illinois Investment Policy Board shall adhere to
18the following procedures for companies on the list of
19restricted companies:
20        (1) For each company newly identified in subsection
21    (d), the Illinois Investment Policy Board, unless it
22    determines by an affirmative vote that it is unfeasible,
23    shall send a written notice informing the company of its
24    status and that it may become subject to divestment or
25    shareholder activism by the retirement systems.
26        (2) If, following the Illinois Investment Policy

 

 

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1    Board's engagement pursuant to this subsection (e) with a
2    restricted company, that company ceases activity that
3    designates the company to be an Iran-restricted company, a
4    Sudan-restricted company, a company that boycotts Israel,
5    an expatriated entity, or a for-profit company that
6    contracts to shelter migrant children, the company shall
7    be removed from the list of restricted companies and the
8    provisions of this Section shall cease to apply to it
9    unless it resumes such activities.
10        (3) For a company that is domiciled or has its
11    principal place of business in Russia or Belarus, if,
12    following the Illinois Investment Policy Board's
13    engagement pursuant to this subsection (e), that company
14    is no longer domiciled or has its principal place of
15    business in Russia or Belarus, the company shall be
16    removed from the list of restricted companies and the
17    provisions of this Section shall cease to apply to it
18    unless it becomes domiciled or has its principal place of
19    business in Russia or Belarus.
20        (4) For a company that is subject to Russian Harmful
21    Foreign Activities Sanctions, if, following the Illinois
22    Investment Policy Board's engagement pursuant to this
23    subsection (e), that company is no longer subject to
24    Russian Harmful Foreign Activities Sanctions, the company
25    shall be removed from the list of restricted companies and
26    the provisions of this Section shall cease to apply to it

 

 

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1    unless it becomes subject to Russian Harmful Foreign
2    Activities Sanctions.
3    (f) Except as provided in subsection (f-1) of this Section
4the retirement system shall adhere to the following procedures
5for companies on the list of restricted companies:
6        (1) The retirement system shall identify those
7    companies on the list of restricted companies in which the
8    retirement system owns direct holdings and indirect
9    holdings.
10        (2) The retirement system shall instruct its
11    investment advisors to sell, redeem, divest, or withdraw
12    all direct holdings of restricted companies from the
13    retirement system's assets under management in an orderly
14    and fiduciarily responsible manner within 12 months after
15    the company's most recent appearance on the list of
16    restricted companies.
17        (3) The retirement system may not acquire securities
18    of restricted companies.
19        (4) The provisions of this subsection (f) do not apply
20    to the retirement system's indirect holdings or private
21    market funds. The Illinois Investment Policy Board shall
22    submit letters to the managers of those investment funds
23    containing restricted companies requesting that they
24    consider removing the companies from the fund or create a
25    similar actively managed fund having indirect holdings
26    devoid of the companies. If the manager creates a similar

 

 

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1    fund, the retirement system shall replace all applicable
2    investments with investments in the similar fund in an
3    expedited timeframe consistent with prudent investing
4    standards.
5    (f-1) The retirement system shall adhere to the following
6procedures for restricted companies that are expatriated
7entities or for-profit companies that contract to shelter
8migrant children:
9        (1) To the extent that the retirement system believes
10    that shareholder activism would be more impactful than
11    divestment, the retirement system shall have the authority
12    to engage with a restricted company prior to divesting.
13        (2) Subject to any applicable State or Federal laws,
14    methods of shareholder activism utilized by the retirement
15    system may include, but are not limited to, bringing
16    shareholder resolutions and proxy voting on shareholder
17    resolutions.
18        (3) The retirement system shall report on its
19    shareholder activism and the outcome of such efforts to
20    the Illinois Investment Policy Board by April 1 of each
21    year.
22        (4) If the engagement efforts of the retirement system
23    are unsuccessful, then it shall adhere to the procedures
24    under subsection (f) of this Section.
25    (f-5) Beginning on the effective date of this amendatory
26Act of the 102nd General Assembly, no retirement system shall

 

 

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1invest moneys in Russian or Belarusian sovereign debt, Russian
2or Belarusian government-backed securities, any investment
3instrument issued by an entity that is domiciled or has its
4principal place of business in Russia or Belarus, or any
5investment instrument issued by a company that is subject to
6Russian Harmful Foreign Activities Sanctions, and no
7retirement system shall invest or deposit State moneys in any
8bank that is domiciled or has its principal place of business
9in Russia or Belarus. As soon as practicable after the
10effective date of this amendatory Act of the 102nd General
11Assembly, each retirement system shall instruct its investment
12advisors to sell, redeem, divest, or withdraw all direct
13holdings of Russian or Belarusian sovereign debt and direct
14holdings of Russian or Belarusian government-backed securities
15from the retirement system's assets under management in an
16orderly and fiduciarily responsible manner.
17    Notwithstanding any provision of this Section to the
18contrary, a retirement system may cease divestment pursuant to
19this subsection (f-5) if clear and convincing evidence shows
20that the value of investments in such Russian or Belarusian
21sovereign debt and Russian or Belarusian government-backed
22securities becomes equal to or less than 0.05% of the market
23value of all assets under management by the retirement system.
24For any cessation of divestment authorized by this subsection
25(f-5), the retirement system shall provide a written notice to
26the Illinois Investment Policy Board in advance of the

 

 

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1cessation of divestment, setting forth the reasons and
2justification, supported by clear and convincing evidence, for
3its decision to cease divestment under this subsection (f-5).
4    The provisions of this subsection (f-5) do not apply to
5the retirement system's indirect holdings or private market
6funds.
7    (g) Upon request, and by April 1 of each year, each
8retirement system shall provide the Illinois Investment Policy
9Board with information regarding investments sold, redeemed,
10divested, or withdrawn in compliance with this Section.
11    (h) Notwithstanding any provision of this Section to the
12contrary, a retirement system may cease divesting from
13companies pursuant to subsection (f) if clear and convincing
14evidence shows that the value of investments in such companies
15becomes equal to or less than 0.5% of the market value of all
16assets under management by the retirement system. For any
17cessation of divestment authorized by this subsection (h), the
18retirement system shall provide a written notice to the
19Illinois Investment Policy Board in advance of the cessation
20of divestment, setting forth the reasons and justification,
21supported by clear and convincing evidence, for its decision
22to cease divestment under subsection (f).
23    (i) The cost associated with the activities of the
24Illinois Investment Policy Board shall be borne by the boards
25of each pension fund or investment board created under Article
2615, 16, or 22A of this Code.

 

 

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1    (j) With respect to actions taken in compliance with this
2Section, including all good-faith determinations regarding
3companies as required by this Section, the retirement system
4and Illinois Investment Policy Board are exempt from any
5conflicting statutory or common law obligations, including any
6fiduciary duties under this Article and any obligations with
7respect to choice of asset managers, investment funds, or
8investments for the retirement system's securities portfolios.
9    (k) It is not the intent of the General Assembly in
10enacting this amendatory Act of the 99th General Assembly to
11cause divestiture from any company based in the United States
12of America. The Illinois Investment Policy Board shall
13consider this intent when developing or reviewing the list of
14restricted companies.
15    (l) If any provision of this amendatory Act of the 99th
16General Assembly or its application to any person or
17circumstance is held invalid, the invalidity of that provision
18or application does not affect other provisions or
19applications of this amendatory Act of the 99th General
20Assembly that can be given effect without the invalid
21provision or application.
22    If any provision of Public Act 100-551 or its application
23to any person or circumstance is held invalid, the invalidity
24of that provision or application does not affect other
25provisions or applications of Public Act 100-551 that can be
26given effect without the invalid provision or application.

 

 

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1    If any provision of Public Act 102-118 this amendatory Act
2of the 102nd General Assembly or its application to any person
3or circumstance is held invalid, the invalidity of that
4provision or application does not affect other provisions or
5applications of Public Act 102-118 this amendatory Act of the
6102nd General Assembly that can be given effect without the
7invalid provision or application.
8    If any provision of this amendatory Act of the 102nd
9General Assembly or its application to any person or
10circumstance is held invalid, the invalidity of that provision
11or application does not affect other provisions or
12applications of this amendatory Act of the 102nd General
13Assembly that can be given effect without the invalid
14provision or application.
15(Source: P.A. 102-118, eff. 7-23-21; 102-699, eff. 4-19-22.)
 
16    Section 10-40. The Board of Higher Education Act is
17amended by adding Section 9.42 as follows:
 
18    (110 ILCS 205/9.42 new)
19    Sec. 9.42. Disclosure of donations from certain Russian,
20Belarusian, or sanctioned sources. The Board shall require
21each public institution of higher education to disclose to the
22Board any endowment or other donation given to the institution
23from a source associated with any individual or entity listed
24on the sanctions list maintained by the U.S. Department of

 

 

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1Treasury's Office of Foreign Asset Control or any company that
2is domiciled or has its principal place of business in Russia
3or Belarus and is on the list of restricted companies
4developed by the Illinois Investment Policy Board under
5Section 1-110.16 of the Illinois Pension Code.
 
6
Article 99.

 
7    Section 99-97. Severability. The provisions of this Act
8are severable under Section 1.31 of the Statute on Statutes.
 
9    Section 99-99. Effective date. This Act takes effect upon
10becoming law.