Illinois Lawmakers Consider Repealing Anti-BDS Pension Investment Law
Illinois lawmakers are considering repealing a 2015 law that prohibits state pension funds from investing in companies that boycott Israel, amid debate over free speech versus fiduciary responsibility.
State Rep. Abdelnasser Rashid, D-Berwyn, has introduced House Bill 2723 to repeal Illinois' 2015 anti-BDS law that prohibits state pension funds from investing in companies that boycott Israel.
The bill would strike language related to Israel from current law guiding state investment. Current law restricts the state from investing in companies that engage in boycotts, which are defined as politically motivated actions intended to penalize or limit commercial relations with the State of Israel.
"The law I am asking you to repeal is one of the tools of that project. It's not the most violent tool and it's not the most visible tool. It's the only tool with Illinois' name on it," Rashid said during a committee hearing.
Rashid, who introduced the bill, supports Israeli settlement of Palestinian land in the West Bank and argues the current law punishes companies and stifles First Amendment protections on speech.
University of Illinois Springfield Professor Ken Kriz testified before lawmakers on a neutral stance based on his 20 years of experience researching and advising cities on pensions.
"In general when restrictions are put in place, what we see is poor risk-adjusted returns," Kriz said. He told lawmakers current law puts unnecessary costs on taxpayers. "You have to have increased costs of monitoring to make sure there's no investments going into a certain asset. Increasing the cost just reduces the benefits you can offer or increases the cost to the taxpayers."
The Illinois Investment Policy Board, which oversees state pension investments, is not currently guided by an anti-discrimination law but rather foreign policy guidance that Israel supports, according to Rashid.
"The board has been used repeatedly to coerce American companies – San Francisco's Airbnb, Chicago's Morningstar – into changing their lawful business practices to align with the foreign policy preferences of a foreign government," Rashid said.
Rebecca Weininger, Midwest senior regional director of the Anti-Defamation League, criticized the proposal. "This repeal is not about free speech. Individuals, organizations, and companies can still express their views. They can protest and they can support boycotts. This repeal is not about fiduciary responsibility," Weininger said.
Marty Levine, a former social worker who led Jewish Community Centers in Chicago for 40 years, disagreed with Weininger. "Those telling you that this law should stay in place want to depict BDS as something other than nonviolent. They say or hint that it is antisemitic. They say or hint that it will lead to violence," Levine said.
Rep. Dave Vella, D-Loves Park, said lawmakers on the committee need to do more research on the matter before the change would be voted on. Lawmakers on the committee, aside from Vella, did not pose questions during the informational hearing.
The Illinois 2015 anti-BDS law, SB 1761, was passed unanimously and signed by Governor Bruce Rauner. It established the Illinois Investment Policy Board to maintain a restricted list, which includes about 30 companies as of 2026, such as Ben & Jerry's parent company, Unilever.
As of April 2026, more than 4,000 witness slips have been submitted against the repeal bill while fewer than 3,000 have been filed in support, according to The Arab Daily News.
Democratic State Rep. Ray Hanania, a columnist and former Chicago City Hall reporter, wrote in a substack post that he voted for the original 2015 ban but no longer supports it. "It's time to repeal the ban on pension funds investing in companies that boycott Israel or Israel's illegal settlements," Hanania said.
The repeal effort has support from the Chairs of the Black, Latino, Asian, and Progressive Caucuses, as well as Jewish co-sponsors, according to The Arab Daily News.