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SB 1455

PEN CD-DEFERRED COMP-FEES

104th Regular Session Introduced by Rob Martwick

Starting 1/1/2026, Illinois Deferred Compensation Plan costs are recovered by equitably prorating admin fees among participating employers, not charged to investment earnings or em

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Bill Summary · SB 1455

Summary — SB 1455 (Deferred Compensation: recovery of administrative expenses)

Note: the provided document contains text from multiple bills numbered “SB 1455” in different states (Arizona, Hawaii and Illinois). This summary focuses on the Illinois enactment described as “PEN CD‑DEFERRED COMP‑FEES,” which is the substantive bill that became Public Act 25‑62. Short notes on the other items appear at the end.

Purpose and intent

The bill changes how the administrative costs of Illinois’ Deferred Compensation Plan (the Plan established under Section 24‑104 of the Illinois Pension Code) are recovered. The primary intent is to shift the ongoing administrative cost burden from investment earnings or employees to the participating employers by charging fees prorated among employers.

Key provisions

  • Amends 40 ILCS 5/24‑104.1 (Illinois Pension Code) to require that, beginning January 1, 2026, the Plan’s administrative expenses be recovered by charging fees equitably prorated among participating employers.
    • Prior language allowed charging administrative expenses against investment earnings, charging fees prorated among participating state employees, or other equitable methods as the Board determined.
  • Senate Amendment (adopted) clarifies implementation:
    • Beginning January 1, 2026, the Department of Central Management Services (CMS) shall recover its expenses for administering the Plan (per Section 24‑105) by charging fees equitably prorated among participating employers.
  • Preserves older repayment language regarding sums advanced to the State Board of Investment for Plan development (historical repayment/amortization provisions).
  • Adds a State Mandates Act provision (30 ILCS 805/8.49) declaring this an “exempt mandate”: no State reimbursement is required for any mandate created by this amendatory Act.
  • Effective date: the Act takes effect upon becoming law; fee recovery provisions are specified to begin January 1, 2026.

Who is affected / impact

  • Primary fiscal effect: participating employers in the Deferred Compensation Plan (state agencies and other employers that participate in the Plan) will bear the Plan’s administrative fees equitably prorated among them starting 1/1/2026.
  • Secondary effects:
    • Employees and investment accounts may no longer have administrative fees charged against investment earnings or be required to absorb fees directly (depending on prior practice), which could preserve participant investment returns.
    • The Department of Central Management Services will implement and collect employer fees to cover CMS’s administration costs for the Plan.
  • Fiscal note context: the State Mandates Act amendment states the measure is exempt from state reimbursement requirements, so no additional reimbursement to local units is required under that Act.

Timeline and procedural status (Illinois)

  • Passed both chambers; enrolled and sent to governor.
  • Became law as Public Act 25‑62; effective immediately upon becoming law with the administrative recovery mechanism specified to begin January 1, 2026.
  • Legislative history includes floor amendments adopting the employer‑fee approach and adding the CMS administration provision.

Related bills / other jurisdictions (brief)

  • Arizona SB 1455 (different measure) — would add ARS §16‑231 to prohibit election officers or employees whose duties include election administration from performing those duties if they are candidates on the ballot for that election (exception: precinct committeeman). This is unrelated to the Illinois deferred compensation bill.
  • A separate summary referenced a Hawaii Retirement Savings Act change (automatic enrollment / opt‑out) — also unrelated but included in the supplied materials.
  • Companions / sponsors shown across documents (e.g., Robert F. Martwick for IL) reflect the multi‑jurisdictional materials provided.

If you want, I can:
- Produce a short one‑page memo on expected budgetary impacts for participating employers, or
- Produce a clean, jurisdiction‑specific summary (Illinois, Arizona, or Hawaii) separated into distinct pages.

Compiled from official sources — confirm details with the bill’s official record.

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