On December 18, 2019, Illinois Governor JB Prtizker signed into law Public Act 101-0610, which provided for the mandatory consolidation of the investment assets of the State’s public safety pension funds into two consolidated investment funds – one for police pension funds (Article 3 Funds) and one for firefighter pension funds (Article 4 Funds), effective January 1, 2020. Each newly created consolidated investment fund is governed by an independent and autonomous nine-member Board of Trustees, who have been charged with overseeing the investment directives of the newly formed investment funds. The consolidation of these assets into two state-wide investment funds has created the need for all local police and firefighter pension funds to transfer their asset holdings to the two newly created investment funds. The consolidated investment funds are required to provide written notice of an asset transfer date to the local pension fund.
The consolidated fire pension board first tranches occurred in October and November of 2021 and the consolidated police pension board first tranches will occur in January and February of 2022, with additional tranches planned for both consolidated funds. Each local pension fund will be required to go through a Certified Asset List process to ensure what assets will be included in the final asset transfer, which will be provided no less than 10 days prior to the local fund’s transfer date. The Certified Asset Lists will contain a Transferable Asset List (assets that will transition to the consolidated fund on the transfer date) and a Non-Transferable Asset List (assets that will REMAIN with the local fund on and after the transfer date).