IMPLEMENTATION UPDATE: On August 17, 2015, the Illinois Secure Choice Savings Board held its first meeting and reviewed its statutory requirements.
The Office of the State Treasurer posted an RFP with addenda for an External Investment Advisor on September 15, 2015 that closed on November 9, 2015.
The Office of the State Treasurer posted an RFI with addendum on October 16, 2015 seeking an ERISA Counsel that closed on November 13, 2015.
On November 16, 2015, U.S. Secretary of Labor Thomas E. Perez and Illinois State Treasurer Michael Frerichs announced sweeping new rules outlining the path forward for state-sponsored retirement savings initiatives.
On November 18, 2015, the Board held a meeting to discuss organizational issues and implementation timelines.
On December 9, 2015, the Investment subcommittee met and on December 11 and 16, 2015, the Board held meetings. Last updated 12/22/2015.
LEGISLATIVE HISTORY: SB 2758 was introduced by Senator Daniel Biss in January 2014 and was signed into law on January 4, 2015.
This bill establishes the Illinois Secure Choice Savings Board to administer the Illinois Secure Choice Retirement Savings Program Fund. The program would be a mandatory (penalties for noncompliance) state-sponsored payroll deduction IRA for private sector workers at employers with twenty-five or more employees that do not offer a retirement plan. An automatic default three percent (minimum) payroll deduction would be made into individual retirement accounts unless an employee chooses another amount or opts-out of the program at any time. Assets would be pooled and professionally managed, with a privately-underwritten guarantee, and the state or employer will not be responsible for any liabilities. The law must be implemented within 24 months after the effective date of the Act with an additional delay permitted if the Board does not obtain adequate funds to implement the program and the Board is also required to request an ERISA opinion from the U.S. Department of Labor. The program would only be established if the board can find that the system will be self-sustaining, qualifies for favorable federal tax treatment, and is not considered an employment benefit plan under the Employee Retirement Income Security Act of 1974 (ERISA).
On July 24, 2015, Treasurer Michael Frerichs sent a letter to thank DOL Secretary Perez for showing leadership on state related retirement initiatives and offering Illinois as a resource as DOL contemplates future rulemaking related to state initiatives. Last updated 11/10/15.
2015 Legislative Session Dates: January 12, 2015 – May 31, 2015
Visit the official website for the Illinois General Assembly.
Source: Georgetown University’s Center for Retirement Initiatives