101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB2795

 

Introduced 2/4/2020, by Sen. Robert F. Martwick

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/7-141  from Ch. 108 1/2, par. 7-141
40 ILCS 5/15-135  from Ch. 108 1/2, par. 15-135
40 ILCS 5/16-142.3  from Ch. 108 1/2, par. 16-142.3
30 ILCS 805/8.44 new

    Amends the Illinois Pension Code. In the Illinois Municipal Retirement Fund (IMRF) Article, provides that retirement annuities shall be payable upon attainment of the required age of distribution under a specified provision of the Internal Revenue Code of 1986 (instead of age 70 1/2). In the State Universities Article, provides that if a participant is not an employee of an employer participating in the System or in a reciprocal system on April 1 of the calendar year next following the calendar year in which the participant attains the age specified under a provision of the Internal Revenue Code of 1986 (instead of the age of 70 1/2), the annuity payment period shall begin on that date. In a provision of the Downstate Teacher Article concerning the required distribution of monthly survivor benefits for certain persons, provides that the distribution shall become payable on certain dates or December 1 of the calendar year in which the deceased member or annuitant would have attained age 72 (instead of 70 1/2), whichever occurs latest. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.


LRB101 19188 RPS 68651 b

FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT

 

 

A BILL FOR

 

SB2795LRB101 19188 RPS 68651 b

1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by changing
5Sections 7-141, 15-135, and 16-142.3 as follows:
 
6    (40 ILCS 5/7-141)  (from Ch. 108 1/2, par. 7-141)
7    Sec. 7-141. Retirement annuities - Conditions. Retirement
8annuities shall be payable as hereinafter set forth:
9    (a) A participating employee who, regardless of cause, is
10separated from the service of all participating municipalities
11and instrumentalities thereof and participating
12instrumentalities shall be entitled to a retirement annuity
13provided:
14        1. He is at least age 55, or in the case of a person who
15    is eligible to have his annuity calculated under Section
16    7-142.1, he is at least age 50;
17        2. He is not entitled to receive earnings for
18    employment in a position requiring him, or entitling him to
19    elect, to be a participating employee;
20        3. The amount of his annuity, before the application of
21    paragraph (b) of Section 7-142 is at least $10 per month;
22        4. If he first became a participating employee after
23    December 31, 1961, he has at least 8 years of service. This

 

 

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1    service requirement shall not apply to any participating
2    employee, regardless of participation date, if the General
3    Assembly terminates the Fund.
4    (b) Retirement annuities shall be payable:
5        1. As provided in Section 7-119;
6        2. Except as provided in item 3, upon receipt by the
7    fund of a written application. The effective date may be
8    not more than one year prior to the date of the receipt by
9    the fund of the application;
10        3. Upon attainment of the required age of distribution
11    under Section 401(a)(9) of the Internal Revenue Code of
12    1986, as amended, age 70 1/2 if the member (i) is no longer
13    in service, and (ii) is otherwise entitled to an annuity
14    under this Article;
15        4. To the beneficiary of the deceased annuitant for the
16    unpaid amount accrued to date of death, if any.
17(Source: P.A. 97-328, eff. 8-12-11; 97-609, eff. 1-1-12.)
 
18    (40 ILCS 5/15-135)  (from Ch. 108 1/2, par. 15-135)
19    Sec. 15-135. Retirement annuities - Conditions.
20    (a) This subsection (a) applies only to a Tier 1 member. A
21participant who retires in one of the following specified years
22with the specified amount of service is entitled to a
23retirement annuity at any age under the retirement program
24applicable to the participant:
25        35 years if retirement is in 1997 or before;

 

 

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1        34 years if retirement is in 1998;
2        33 years if retirement is in 1999;
3        32 years if retirement is in 2000;
4        31 years if retirement is in 2001;
5        30 years if retirement is in 2002 or later.
6    A participant with 8 or more years of service after
7September 1, 1941, is entitled to a retirement annuity on or
8after attainment of age 55.
9    A participant with at least 5 but less than 8 years of
10service after September 1, 1941, is entitled to a retirement
11annuity on or after attainment of age 62.
12    A participant who has at least 25 years of service in this
13system as a police officer or firefighter is entitled to a
14retirement annuity on or after the attainment of age 50, if
15Rule 4 of Section 15-136 is applicable to the participant.
16    (a-5) A Tier 2 member is entitled to a retirement annuity
17upon written application if he or she has attained age 67 and
18has at least 10 years of service credit and is otherwise
19eligible under the requirements of this Article. A Tier 2
20member who has attained age 62 and has at least 10 years of
21service credit and is otherwise eligible under the requirements
22of this Article may elect to receive the lower retirement
23annuity provided in subsection (b-5) of Section 15-136 of this
24Article.
25    (a-10) A Tier 2 member who has at least 20 years of service
26in this system as a police officer or firefighter is entitled

 

 

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1to a retirement annuity upon written application on or after
2the attainment of age 60 if Rule 4 of Section 15-136 is
3applicable to the participant. The changes made to this
4subsection by this amendatory Act of the 101st General Assembly
5apply retroactively to January 1, 2011.
6    (b) The annuity payment period shall begin on the date
7specified by the participant or the recipient of a disability
8retirement annuity submitting a written application. For a
9participant, the date on which the annuity payment period
10begins shall not be prior to termination of employment or more
11than one year before the application is received by the board;
12however, if the participant is not an employee of an employer
13participating in this System or in a participating system as
14defined in Article 20 of this Code on April 1 of the calendar
15year next following the calendar year in which the participant
16attains the age specified under Section 401(a)(9) of the
17Internal Revenue Code of 1986, as amended 70 1/2, the annuity
18payment period shall begin on that date regardless of whether
19an application has been filed. For a recipient of a disability
20retirement annuity, the date on which the annuity payment
21period begins shall not be prior to the discontinuation of the
22disability retirement annuity under Section 15-153.2.
23    (c) An annuity is not payable if the amount provided under
24Section 15-136 is less than $10 per month.
25(Source: P.A. 100-556, eff. 12-8-17; 101-610, eff. 1-1-20.)
 

 

 

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1    (40 ILCS 5/16-142.3)  (from Ch. 108 1/2, par. 16-142.3)
2    Sec. 16-142.3. Required distributions.
3    (a) A person who would be eligible to receive a monthly
4survivor benefit under this Article but for the fact that the
5person has not yet attained age 50, and who has not elected to
6receive a lump sum distribution under subsection (a) of Section
716-141, shall be eligible for a monthly distribution under this
8subsection (a), provided that the payment of such distribution
9is required by federal law.
10    The distribution shall become payable on (i) July 1, 1987,
11(ii) December 1 of the calendar year immediately following the
12calendar year in which the member or annuitant died, or (iii)
13December 1 of the calendar year in which the deceased member or
14annuitant would have attained age 72 70 1/2, whichever occurs
15latest, and shall remain payable until the first of the
16following to occur: (1) the person becomes eligible to receive
17a monthly survivor benefit under this Article; (2) the day
18following the date on which the member ceases to be eligible to
19receive a monthly survivor benefit upon attainment of age 50,
20due to remarriage or death; or (3) the day on which such
21distribution ceases to be required by federal law.
22    The amount of the distribution shall be fixed at the time
23the distribution first becomes payable, and shall be calculated
24in the same manner as the monthly survivor benefit under
25Sections 16-141, 16-142, 16-142.1 and 16-142.2, but excluding
26any automatic annual increases, supplemental increases, or

 

 

SB2795- 6 -LRB101 19188 RPS 68651 b

1one-time increases that may be provided by law for monthly
2survivor benefits.
3    (b) For the purpose of this Section, a distribution shall
4be deemed to be required by federal law if: (1) directly
5mandated by federal statute, rule, or administrative or court
6decision; or (2) indirectly mandated through imposition of
7substantial tax or other penalties for noncompliance.
8    (c) Notwithstanding Section 1-103.1 of this Code, a member
9need not be in service on or after the effective date of this
10amendatory Act of 1989 for the member's surviving spouse to be
11eligible for a distribution under this Section.
12(Source: P.A. 86-273.)
 
13    Section 90. The State Mandates Act is amended by adding
14Section 8.44 as follows:
 
15    (30 ILCS 805/8.44 new)
16    Sec. 8.44. Exempt mandate. Notwithstanding Sections 6 and 8
17of this Act, no reimbursement by the State is required for the
18implementation of any mandate created by this amendatory Act of
19the 101st General Assembly.
 
20    Section 99. Effective date. This Act takes effect upon
21becoming law.