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Public Act 102-0718


 

Public Act 0718 102ND GENERAL ASSEMBLY

  
  
  

 


 
Public Act 102-0718
 
HB4292 EnrolledLRB102 22139 RPS 31268 b

    AN ACT concerning public employee benefits.
 
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
 
    Section 5. The General Obligation Bond Act is amended by
changing Sections 2, 2.5, and 7.7 as follows:
 
    (30 ILCS 330/2)  (from Ch. 127, par. 652)
    Sec. 2. Authorization for Bonds. The State of Illinois is
authorized to issue, sell and provide for the retirement of
General Obligation Bonds of the State of Illinois for the
categories and specific purposes expressed in Sections 2
through 8 of this Act, in the total amount of $79,256,839,969
$78,256,839,969.
    The bonds authorized in this Section 2 and in Section 16 of
this Act are herein called "Bonds".
    Of the total amount of Bonds authorized in this Act, up to
$2,200,000,000 in aggregate original principal amount may be
issued and sold in accordance with the Baccalaureate Savings
Act in the form of General Obligation College Savings Bonds.
    Of the total amount of Bonds authorized in this Act, up to
$300,000,000 in aggregate original principal amount may be
issued and sold in accordance with the Retirement Savings Act
in the form of General Obligation Retirement Savings Bonds.
    Of the total amount of Bonds authorized in this Act, the
additional $10,000,000,000 authorized by Public Act 93-2, the
$3,466,000,000 authorized by Public Act 96-43, and the
$4,096,348,300 authorized by Public Act 96-1497 shall be used
solely as provided in Section 7.2.
    Of the total amount of Bonds authorized in this Act, the
additional $6,000,000,000 authorized by Public Act 100-23
shall be used solely as provided in Section 7.6 and shall be
issued by December 31, 2017.
    Of the total amount of Bonds authorized in this Act,
$2,000,000,000 $1,000,000,000 of the additional amount
authorized by Public Act 100-587 and this amendatory Act of
the 102nd General Assembly shall be used solely as provided in
Section 7.7.
    The issuance and sale of Bonds pursuant to the General
Obligation Bond Act is an economical and efficient method of
financing the long-term capital needs of the State. This Act
will permit the issuance of a multi-purpose General Obligation
Bond with uniform terms and features. This will not only lower
the cost of registration but also reduce the overall cost of
issuing debt by improving the marketability of Illinois
General Obligation Bonds.
(Source: P.A. 100-23, eff. 7-6-17; 100-587, eff. 6-4-18;
101-30, eff. 6-28-19.)
 
    (30 ILCS 330/2.5)
    Sec. 2.5. Limitation on issuance of Bonds.
    (a) Except as provided in subsection (b), no Bonds may be
issued if, after the issuance, in the next State fiscal year
after the issuance of the Bonds, the amount of debt service
(including principal, whether payable at maturity or pursuant
to mandatory sinking fund installments, and interest) on all
then-outstanding Bonds, other than (i) Bonds authorized by
Public Act 100-23, (ii) Bonds issued by Public Act 96-43,
(iii) Bonds authorized by Public Act 96-1497, and (iv) Bonds
authorized by Public Act 100-587, and (v) Bonds authorized by
this amendatory Act of the 102nd General Assembly, would
exceed 7% of the aggregate appropriations from the general
funds, the State Construction Account Fund, and the Road Fund
for the fiscal year immediately prior to the fiscal year of the
issuance. For the purposes of this subsection (a), "general
funds" has the same meaning as ascribed to that term under
Section 50-40 of the State Budget Law of the Civil
Administrative Code of Illinois.
    (b) If the Comptroller and Treasurer each consent in
writing, Bonds may be issued even if the issuance does not
comply with subsection (a). In addition, $2,000,000,000 in
Bonds for the purposes set forth in Sections 3, 4, 5, 6, and 7,
and $2,000,000,000 in Refunding Bonds under Section 16, may be
issued during State fiscal year 2017 without complying with
subsection (a). In addition, $2,000,000,000 in Bonds for the
purposes set forth in Sections 3, 4, 5, 6, and 7, and
$2,000,000,000 in Refunding Bonds under Section 16, may be
issued during State fiscal year 2018 without complying with
subsection (a).
(Source: P.A. 100-23, Article 25, Section 25-5, eff. 7-6-17;
100-23, Article 75, Section 75-10, eff. 7-6-17; 100-587, eff.
6-4-18; 100-863, eff. 8-14-18; 101-30, eff. 6-28-19.)
 
    (30 ILCS 330/7.7)
    Sec. 7.7. State Pension Obligation Acceleration Bonds.
    (a) As used in this Act, "State Pension Obligation
Acceleration Bonds" means Bonds authorized by Public Act
100-587 and this amendatory Act of the 102nd General Assembly
this amendatory Act of the 100th General Assembly and used for
the purpose of making accelerated pension benefit payments
under Articles 14, 15, and 16 of the Illinois Pension Code.
    (b) State Pension Obligation Acceleration Bonds in the
amount of $2,000,000,000 $1,000,000,000 are hereby authorized
to be used for the purpose of making accelerated pension
benefit payments under Articles 14, 15, and 16 of the Illinois
Pension Code.
    (c) The proceeds of State Pension Obligation Acceleration
Bonds authorized in subsection (b) of this Section, less the
amounts authorized in the Bond Sale Order to be directly paid
out for bond sale expenses under Section 8, shall be deposited
directly into the State Pension Obligation Acceleration Bond
Fund, and the Comptroller and the Treasurer shall, as soon as
practical, make accelerated pension benefit payments under
Articles 14, 15, and 16 of the Illinois Pension Code.
    (d) There is created the State Pension Obligation
Acceleration Bond Fund as a special fund in the State
Treasury. Funds deposited in the State Pension Obligation
Acceleration Bond Fund may only be used for the purpose of
making accelerated pension benefit payments under Articles 14,
15, and 16 of the Illinois Pension Code or for the payment of
principal and interest due on State Pension Obligation
Acceleration Bonds. This subsection shall constitute an
irrevocable and continuing appropriation of all amounts
necessary for such purposes.
(Source: P.A. 100-587, eff. 6-4-18.)
 
    Section 10. The Illinois Pension Code is amended by
changing Sections 14-147.5, 14-147.6, 15-185.5, 15-185.6,
16-190.5, and 16-190.6 as follows:
 
    (40 ILCS 5/14-147.5)
    Sec. 14-147.5. Accelerated pension benefit payment in lieu
of any pension benefit.
    (a) As used in this Section:
    "Eligible person" means a person who:
        (1) has terminated service;
        (2) has accrued sufficient service credit to be
    eligible to receive a retirement annuity under this
    Article;
        (3) has not received any retirement annuity under this
    Article; and
        (4) has not made the election under Section 14-147.6.
    "Pension benefit" means the benefits under this Article,
or Article 1 as it relates to those benefits, including any
anticipated annual increases, that an eligible person is
entitled to upon attainment of the applicable retirement age.
"Pension benefit" also includes applicable survivor's or
disability benefits.
    (b) As soon as practical after June 4, 2018 (the effective
date of Public Act 100-587), the System shall calculate, using
actuarial tables and other assumptions adopted by the Board,
the present value of pension benefits for each eligible person
who requests that information and shall offer each eligible
person the opportunity to irrevocably elect to receive an
amount determined by the System to be equal to 60% of the
present value of his or her pension benefits in lieu of
receiving any pension benefit. The offer shall specify the
dollar amount that the eligible person will receive if he or
she so elects and shall expire when a subsequent offer is made
to an eligible person. An eligible person is limited to one
calculation and offer per calendar year. The System shall make
a good faith effort to contact every eligible person to notify
him or her of the election.
    Until June 30, 2026 2024, an eligible person may
irrevocably elect to receive an accelerated pension benefit
payment in the amount that the System offers under this
subsection in lieu of receiving any pension benefit. A person
who elects to receive an accelerated pension benefit payment
under this Section may not elect to proceed under the
Retirement Systems Reciprocal Act with respect to service
under this Article.
    (c) A person's creditable service under this Article shall
be terminated upon the person's receipt of an accelerated
pension benefit payment under this Section, and no other
benefit shall be paid under this Article based on the
terminated creditable service, including any retirement,
survivor, or other benefit; except that to the extent that
participation, benefits, or premiums under the State Employees
Group Insurance Act of 1971 are based on the amount of service
credit, the terminated service credit shall be used for that
purpose.
    (d) If a person who has received an accelerated pension
benefit payment under this Section returns to active service
under this Article, then:
        (1) Any benefits under the System earned as a result
    of that return to active service shall be based solely on
    the person's creditable service arising from the return to
    active service.
        (2) The accelerated pension benefit payment may not be
    repaid to the System, and the terminated creditable
    service may not under any circumstances be reinstated.
    (e) As a condition of receiving an accelerated pension
benefit payment, the accelerated pension benefit payment must
be transferred into a tax qualified retirement plan or
account. The accelerated pension benefit payment under this
Section may be subject to withholding or payment of applicable
taxes, but to the extent permitted by federal law, a person who
receives an accelerated pension benefit payment under this
Section must direct the System to pay all of that payment as a
rollover into another retirement plan or account qualified
under the Internal Revenue Code of 1986, as amended.
    (f) Upon receipt of a member's irrevocable election to
receive an accelerated pension benefit payment under this
Section, the System shall submit a voucher to the Comptroller
for payment of the member's accelerated pension benefit
payment. The Comptroller shall transfer the amount of the
voucher from the State Pension Obligation Acceleration Bond
Fund to the System, and the System shall transfer the amount
into the member's eligible retirement plan or qualified
account.
    (g) The Board shall adopt any rules, including emergency
rules, necessary to implement this Section.
    (h) No provision of this Section shall be interpreted in a
way that would cause the applicable System to cease to be a
qualified plan under the Internal Revenue Code of 1986.
(Source: P.A. 100-587, eff. 6-4-18; 101-10, eff. 6-5-19.)
 
    (40 ILCS 5/14-147.6)
    Sec. 14-147.6. Accelerated pension benefit payment for a
reduction in annual retirement annuity and survivor's annuity
increases.
    (a) As used in this Section:
    "Accelerated pension benefit payment" means a lump sum
payment equal to 70% of the difference of the present value of
the automatic annual increases to a Tier 1 member's retirement
annuity and survivor's annuity using the formula applicable to
the Tier 1 member and the present value of the automatic annual
increases to the Tier 1 member's retirement annuity using the
formula provided under subsection (b-5) and survivor's annuity
using the formula provided under subsection (b-6).
    "Eligible person" means a person who:
        (1) is a Tier 1 member;
        (2) has submitted an application for a retirement
    annuity under this Article;
        (3) meets the age and service requirements for
    receiving a retirement annuity under this Article;
        (4) has not received any retirement annuity under this
    Article; and
        (5) has not made the election under Section 14-147.5.
    (b) As soon as practical after June 4, 2018 (the effective
date of Public Act 100-587) and until June 30, 2026 2024, the
System shall implement an accelerated pension benefit payment
option for eligible persons. Upon the request of an eligible
person, the System shall calculate, using actuarial tables and
other assumptions adopted by the Board, an accelerated pension
benefit payment amount and shall offer that eligible person
the opportunity to irrevocably elect to have his or her
automatic annual increases in retirement annuity calculated in
accordance with the formula provided under subsection (b-5)
and any increases in survivor's annuity payable to his or her
survivor's annuity beneficiary calculated in accordance with
the formula provided under subsection (b-6) in exchange for
the accelerated pension benefit payment. The election under
this subsection must be made before the eligible person
receives the first payment of a retirement annuity otherwise
payable under this Article.
    (b-5) Notwithstanding any other provision of law, the
retirement annuity of a person who made the election under
subsection (b) shall be subject to annual increases on the
January 1 occurring either on or after the attainment of age 67
or the first anniversary of the annuity start date, whichever
is later. Each annual increase shall be calculated at 1.5% of
the originally granted retirement annuity.
    (b-6) Notwithstanding any other provision of law, a
survivor's annuity payable to a survivor's annuity beneficiary
of a person who made the election under subsection (b) shall be
subject to annual increases on the January 1 occurring on or
after the first anniversary of the commencement of the
annuity. Each annual increase shall be calculated at 1.5% of
the originally granted survivor's annuity.
    (c) If a person who has received an accelerated pension
benefit payment returns to active service under this Article,
then:
        (1) the calculation of any future automatic annual
    increase in retirement annuity shall be calculated in
    accordance with the formula provided under subsection
    (b-5); and
        (2) the accelerated pension benefit payment may not be
    repaid to the System.
    (d) As a condition of receiving an accelerated pension
benefit payment, the accelerated pension benefit payment must
be transferred into a tax qualified retirement plan or
account. The accelerated pension benefit payment under this
Section may be subject to withholding or payment of applicable
taxes, but to the extent permitted by federal law, a person who
receives an accelerated pension benefit payment under this
Section must direct the System to pay all of that payment as a
rollover into another retirement plan or account qualified
under the Internal Revenue Code of 1986, as amended.
    (d-5) Upon receipt of a member's irrevocable election to
receive an accelerated pension benefit payment under this
Section, the System shall submit a voucher to the Comptroller
for payment of the member's accelerated pension benefit
payment. The Comptroller shall transfer the amount of the
voucher to the System, and the System shall transfer the
amount into a member's eligible retirement plan or qualified
account.
    (e) The Board shall adopt any rules, including emergency
rules, necessary to implement this Section.
    (f) No provision of this Section shall be interpreted in a
way that would cause the applicable System to cease to be a
qualified plan under the Internal Revenue Code of 1986.
(Source: P.A. 100-587, eff. 6-4-18; 101-10, eff. 6-5-19.)
 
    (40 ILCS 5/15-185.5)
    Sec. 15-185.5. Accelerated pension benefit payment in lieu
of any pension benefit.
    (a) As used in this Section:
    "Eligible person" means a person who:
        (1) has terminated service;
        (2) has accrued sufficient service credit to be
    eligible to receive a retirement annuity under this
    Article;
        (3) has not received any retirement annuity under this
    Article;
        (4) has not made the election under Section 15-185.6;
    and
        (5) is not a participant in the self-managed plan
    under Section 15-158.2.
    "Implementation date" means the earliest date upon which
the Board authorizes eligible persons to begin irrevocably
electing the accelerated pension benefit payment option under
this Section. The Board shall endeavor to make such
participation available as soon as possible after June 4, 2018
(the effective date of Public Act 100-587) and shall establish
an implementation date by Board resolution.
    "Pension benefit" means the benefits under this Article,
or Article 1 as it relates to those benefits, including any
anticipated annual increases, that an eligible person is
entitled to upon attainment of the applicable retirement age.
"Pension benefit" also includes applicable survivors benefits,
disability benefits, or disability retirement annuity
benefits.
    (b) Beginning on the implementation date, the System shall
offer each eligible person the opportunity to irrevocably
elect to receive an amount determined by the System to be equal
to 60% of the present value of his or her pension benefits in
lieu of receiving any pension benefit. The System shall
calculate, using actuarial tables and other assumptions
adopted by the Board, the present value of pension benefits
for each eligible person upon his or her request in writing to
the System. The System shall not perform more than one
calculation per eligible member in a State fiscal year. The
offer shall specify the dollar amount that the eligible person
will receive if he or she so elects and shall expire when a
subsequent offer is made to an eligible person. The System
shall make a good faith effort to contact every eligible
person to notify him or her of the election.
    Beginning on the implementation date and until June 30,
2026 2024, an eligible person may irrevocably elect to receive
an accelerated pension benefit payment in the amount that the
System offers under this subsection in lieu of receiving any
pension benefit. A person who elects to receive an accelerated
pension benefit payment under this Section may not elect to
proceed under the Retirement Systems Reciprocal Act with
respect to service under this Article.
    (c) Upon payment of an accelerated pension benefit payment
under this Section, the person forfeits all accrued rights and
credits in the System and no other benefit shall be paid under
this Article based on those forfeited rights and credits,
including any retirement, survivor, or other benefit; except
that to the extent that participation, benefits, or premiums
under the State Employees Group Insurance Act of 1971 are
based on the amount of service credit, the terminated service
credit shall be used for that purpose.
    (d) If a person who has received an accelerated pension
benefit payment under this Section returns to participation
under this Article, any benefits under the System earned as a
result of that return to participation shall be based solely
on the person's credits and creditable service arising from
the return to participation. Upon return to participation, the
person shall be considered a new employee subject to all the
qualifying conditions for participation and eligibility for
benefits applicable to new employees.
    (d-5) The accelerated pension benefit payment may not be
repaid to the System, and the forfeited rights and credits may
not under any circumstances be reinstated.
    (e) As a condition of receiving an accelerated pension
benefit payment, the accelerated pension benefit payment must
be deposited into a tax qualified retirement plan or account
identified by the eligible person at the time of the election.
The accelerated pension benefit payment under this Section may
be subject to withholding or payment of applicable taxes, but
to the extent permitted by federal law, a person who receives
an accelerated pension benefit payment under this Section must
direct the System to pay all of that payment as a rollover into
another retirement plan or account qualified under the
Internal Revenue Code of 1986, as amended.
    (f) The System shall submit vouchers to the State
Comptroller for the payment of accelerated pension benefit
payments under this Section. The State Comptroller shall pay
the amounts of the vouchers from the State Pension Obligation
Acceleration Bond Fund to the System, and the System shall
deposit the amounts into the applicable tax qualified plans or
accounts.
    (g) The Board shall adopt any rules, including emergency
rules, necessary to implement this Section.
    (h) No provision of this Section shall be interpreted in a
way that would cause the System to cease to be a qualified plan
under the Internal Revenue Code of 1986.
(Source: P.A. 100-587, eff. 6-4-18; 101-10, eff. 6-5-19.)
 
    (40 ILCS 5/15-185.6)
    Sec. 15-185.6. Accelerated pension benefit payment for a
reduction in an annual increase to a retirement annuity and an
annuity benefit payable as a result of death.
    (a) As used in this Section:
    "Accelerated pension benefit payment" means a lump sum
payment equal to 70% of the difference of: (i) the present
value of the automatic annual increases to a Tier 1 member's
retirement annuity, including any increases to any annuity
benefit payable as a result of his or her death, using the
formula applicable to the Tier 1 member; and (ii) the present
value of the automatic annual increases to the Tier 1 member's
retirement annuity, including any increases to any annuity
benefit payable as a result of his or her death, using the
formula provided under subsection (b-5).
    "Eligible person" means a person who:
        (1) is a Tier 1 member;
        (2) has submitted an application for a retirement
    annuity under this Article;
        (3) meets the age and service requirements for
    receiving a retirement annuity under this Article;
        (4) has not received any retirement annuity under this
    Article;
        (5) has not made the election under Section 15-185.5;
    and
        (6) is not a participant in the self-managed plan
    under Section 15-158.2.
    "Implementation date" means the earliest date upon which
the Board authorizes eligible persons to begin irrevocably
electing the accelerated pension benefit payment option under
this Section. The Board shall endeavor to make such
participation available as soon as possible after June 4, 2018
(the effective date of Public Act 100-587) and shall establish
an implementation date by Board resolution.
    (b) Beginning on the implementation date and until June
30, 2026 2024, the System shall implement an accelerated
pension benefit payment option for eligible persons. The
System shall calculate, using actuarial tables and other
assumptions adopted by the Board, an accelerated pension
benefit payment amount for an eligible person upon his or her
request in writing to the System and shall offer that eligible
person the opportunity to irrevocably elect to have his or her
automatic annual increases in retirement annuity and any
annuity benefit payable as a result of his or her death
calculated in accordance with the formula provided in
subsection (b-5) in exchange for the accelerated pension
benefit payment. The System shall not perform more than one
calculation under this Section per eligible person in a State
fiscal year. The election under this subsection must be made
before any retirement annuity is paid to the eligible person,
and the eligible survivor, spouse, or contingent annuitant, as
applicable, must consent to the election under this
subsection.
    (b-5) Notwithstanding any other provision of law, the
retirement annuity of a person who made the election under
subsection (b) shall be increased annually beginning on the
January 1 occurring either on or after the attainment of age 67
or the first anniversary of the annuity start date, whichever
is later, and any annuity benefit payable as a result of his or
her death shall be increased annually beginning on: (1) the
January 1 occurring on or after the commencement of the
annuity if the deceased Tier 1 member died while receiving a
retirement annuity; or (2) the January 1 occurring after the
first anniversary of the commencement of the benefit. Each
annual increase shall be calculated at 1.5% of the originally
granted retirement annuity or annuity benefit payable as a
result of the Tier 1 member's death.
    (c) If an annuitant who has received an accelerated
pension benefit payment returns to participation under this
Article, the calculation of any future automatic annual
increase in retirement annuity under subsection (c) of Section
15-139 shall be calculated in accordance with the formula
provided in subsection (b-5).
    (c-5) The accelerated pension benefit payment may not be
repaid to the System.
    (d) As a condition of receiving an accelerated pension
benefit payment, the accelerated pension benefit payment must
be deposited into a tax qualified retirement plan or account
identified by the eligible person at the time of election. The
accelerated pension benefit payment under this Section may be
subject to withholding or payment of applicable taxes, but to
the extent permitted by federal law, a person who receives an
accelerated pension benefit payment under this Section must
direct the System to pay all of that payment as a rollover into
another retirement plan or account qualified under the
Internal Revenue Code of 1986, as amended.
    (d-5) The System shall submit vouchers to the State
Comptroller for the payment of accelerated pension benefit
payments under this Section. The State Comptroller shall pay
the amounts of the vouchers from the State Pension Obligation
Acceleration Bond Fund to the System, and the System shall
deposit the amounts into the applicable tax qualified plans or
accounts.
    (e) The Board shall adopt any rules, including emergency
rules, necessary to implement this Section.
    (f) No provision of this Section shall be interpreted in a
way that would cause the System to cease to be a qualified plan
under the Internal Revenue Code of 1986.
(Source: P.A. 100-587, eff. 6-4-18; 101-10, eff. 6-5-19.)
 
    (40 ILCS 5/16-190.5)
    Sec. 16-190.5. Accelerated pension benefit payment in lieu
of any pension benefit.
    (a) As used in this Section:
    "Eligible person" means a person who:
        (1) has terminated service;
        (2) has accrued sufficient service credit to be
    eligible to receive a retirement annuity under this
    Article;
        (3) has not received any retirement annuity under this
    Article; and
        (4) has not made the election under Section 16-190.6.
    "Pension benefit" means the benefits under this Article,
or Article 1 as it relates to those benefits, including any
anticipated annual increases, that an eligible person is
entitled to upon attainment of the applicable retirement age.
"Pension benefit" also includes applicable survivor's or
disability benefits.
    (b) As soon as practical after June 4, 2018 (the effective
date of Public Act 100-587), the System shall calculate, using
actuarial tables and other assumptions adopted by the Board,
the present value of pension benefits for each eligible person
who requests that information and shall offer each eligible
person the opportunity to irrevocably elect to receive an
amount determined by the System to be equal to 60% of the
present value of his or her pension benefits in lieu of
receiving any pension benefit. The offer shall specify the
dollar amount that the eligible person will receive if he or
she so elects and shall expire when a subsequent offer is made
to an eligible person. The System shall make a good faith
effort to contact every eligible person to notify him or her of
the election.
    Until June 30, 2026 2024, an eligible person may
irrevocably elect to receive an accelerated pension benefit
payment in the amount that the System offers under this
subsection in lieu of receiving any pension benefit. A person
who elects to receive an accelerated pension benefit payment
under this Section may not elect to proceed under the
Retirement Systems Reciprocal Act with respect to service
under this Article.
    (c) A person's creditable service under this Article shall
be terminated upon the person's receipt of an accelerated
pension benefit payment under this Section, and no other
benefit shall be paid under this Article based on the
terminated creditable service, including any retirement,
survivor, or other benefit; except that to the extent that
participation, benefits, or premiums under the State Employees
Group Insurance Act of 1971 are based on the amount of service
credit, the terminated service credit shall be used for that
purpose.
    (d) If a person who has received an accelerated pension
benefit payment under this Section returns to active service
under this Article, then:
        (1) Any benefits under the System earned as a result
    of that return to active service shall be based solely on
    the person's creditable service arising from the return to
    active service.
        (2) The accelerated pension benefit payment may not be
    repaid to the System, and the terminated creditable
    service may not under any circumstances be reinstated.
    (e) As a condition of receiving an accelerated pension
benefit payment, the accelerated pension benefit payment must
be transferred into a tax qualified retirement plan or
account. The accelerated pension benefit payment under this
Section may be subject to withholding or payment of applicable
taxes, but to the extent permitted by federal law, a person who
receives an accelerated pension benefit payment under this
Section must direct the System to pay all of that payment as a
rollover into another retirement plan or account qualified
under the Internal Revenue Code of 1986, as amended.
    (f) Upon receipt of a member's irrevocable election to
receive an accelerated pension benefit payment under this
Section, the System shall submit a voucher to the Comptroller
for payment of the member's accelerated pension benefit
payment. The Comptroller shall transfer the amount of the
voucher from the State Pension Obligation Acceleration Bond
Fund to the System, and the System shall transfer the amount
into the member's eligible retirement plan or qualified
account.
    (g) The Board shall adopt any rules, including emergency
rules, necessary to implement this Section.
    (h) No provision of Public Act 100-587 shall be
interpreted in a way that would cause the applicable System to
cease to be a qualified plan under the Internal Revenue Code of
1986.
(Source: P.A. 101-10, eff. 6-5-19; 102-558, eff. 8-20-21.)
 
    (40 ILCS 5/16-190.6)
    Sec. 16-190.6. Accelerated pension benefit payment for a
reduction in annual retirement annuity and survivor's annuity
increases.
    (a) As used in this Section:
    "Accelerated pension benefit payment" means a lump sum
payment equal to 70% of the difference of the present value of
the automatic annual increases to a Tier 1 member's retirement
annuity and survivor's annuity using the formula applicable to
the Tier 1 member and the present value of the automatic annual
increases to the Tier 1 member's retirement annuity using the
formula provided under subsection (b-5) and the survivor's
annuity using the formula provided under subsection (b-6).
    "Eligible person" means a person who:
        (1) is a Tier 1 member;
        (2) has submitted an application for a retirement
    annuity under this Article;
        (3) meets the age and service requirements for
    receiving a retirement annuity under this Article;
        (4) has not received any retirement annuity under this
    Article; and
        (5) has not made the election under Section 16-190.5.
    (b) As soon as practical after June 4, 2018 the effective
date of Public Act 100-587) and until June 30, 2026 2024, the
System shall implement an accelerated pension benefit payment
option for eligible persons. Upon the request of an eligible
person, the System shall calculate, using actuarial tables and
other assumptions adopted by the Board, an accelerated pension
benefit payment amount and shall offer that eligible person
the opportunity to irrevocably elect to have his or her
automatic annual increases in retirement annuity calculated in
accordance with the formula provided under subsection (b-5)
and any increases in survivor's annuity payable to his or her
survivor's annuity beneficiary calculated in accordance with
the formula provided under subsection (b-6) in exchange for
the accelerated pension benefit payment. The election under
this subsection must be made before the eligible person
receives the first payment of a retirement annuity otherwise
payable under this Article.
    (b-5) Notwithstanding any other provision of law, the
retirement annuity of a person who made the election under
subsection (b) shall be subject to annual increases on the
January 1 occurring either on or after the attainment of age 67
or the first anniversary of the annuity start date, whichever
is later. Each annual increase shall be calculated at 1.5% of
the originally granted retirement annuity.
    (b-6) Notwithstanding any other provision of law, a
survivor's annuity payable to a survivor's annuity beneficiary
of a person who made the election under subsection (b) shall be
subject to annual increases on the January 1 occurring on or
after the first anniversary of the commencement of the
annuity. Each annual increase shall be calculated at 1.5% of
the originally granted survivor's annuity.
    (c) If a person who has received an accelerated pension
benefit payment returns to active service under this Article,
then:
        (1) the calculation of any future automatic annual
    increase in retirement annuity shall be calculated in
    accordance with the formula provided in subsection (b-5);
    and
        (2) the accelerated pension benefit payment may not be
    repaid to the System.
    (d) As a condition of receiving an accelerated pension
benefit payment, the accelerated pension benefit payment must
be transferred into a tax qualified retirement plan or
account. The accelerated pension benefit payment under this
Section may be subject to withholding or payment of applicable
taxes, but to the extent permitted by federal law, a person who
receives an accelerated pension benefit payment under this
Section must direct the System to pay all of that payment as a
rollover into another retirement plan or account qualified
under the Internal Revenue Code of 1986, as amended.
    (d-5) Upon receipt of a member's irrevocable election to
receive an accelerated pension benefit payment under this
Section, the System shall submit a voucher to the Comptroller
for payment of the member's accelerated pension benefit
payment. The Comptroller shall transfer the amount of the
voucher from the State Pension Obligation Acceleration Bond
Fund to the System, and the System shall transfer the amount
into the member's eligible retirement plan or qualified
account.
    (e) The Board shall adopt any rules, including emergency
rules, necessary to implement this Section.
    (f) No provision of this Section shall be interpreted in a
way that would cause the applicable System to cease to be a
qualified plan under the Internal Revenue Code of 1986.
(Source: P.A. 100-587, eff. 6-4-18; 101-10, eff. 6-5-19.)
 
    Section 99. Effective date. This Act takes effect upon
becoming law.

Effective Date: 5/5/2022