PEN CD-ACCELERATED BENEFIT

Illinois General Assembly - Full Text of SB2950

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB2950

Introduced 1/27/2026, by Sen. Robert F. Martwick

SYNOPSIS AS INTRODUCED:

30 ILCS 330/2

from Ch. 127, par. 652
30 ILCS 330/2.5
30 ILCS 330/7.7
40 ILCS 5/14-147.5
40 ILCS 5/14-147.6
40 ILCS 5/15-185.5
40 ILCS 5/15-185.6
40 ILCS 5/16-190.5
40 ILCS 5/16-190.6

Amends the General Obligation Bond Act. Authorizes an additional
$700,000,000 of State Pension Obligation Acceleration Bonds. Makes a
conforming change. Amends the State Employees, State Universities, and
Downstate Teachers Articles of the Illinois Pension Code. Extends the
option for a participant to receive an accelerated pension benefit payment
in lieu of any pension benefit or for a reduction in the increases to his
or her annual retirement annuity and survivor's annuity to June 30, 2028
(instead of June 30, 2026). Effective immediately.
LRB104 18850 RPS 32295 b

A BILL FOR

SB2950
LRB104 18850 RPS 32295 b
1

AN ACT concerning public employee benefits.

2

Be it enacted by the People of the State of Illinois,
3
represented in the General Assembly:

4

Section 5.
The General Obligation Bond Act is amended by
5
changing Sections 2, 2.5, and 7.7 as follows:

6

(30 ILCS 330/2)

(from Ch. 127, par. 652)
7

Sec. 2.
Authorization for Bonds.
The State of Illinois is
8
authorized to issue, sell and provide for the retirement of
9
General Obligation Bonds of the State of Illinois for the
10
categories and specific purposes expressed in Sections 2
11
through 8 of this Act, in the total amount of
$83,364,839,969

12
$82,664,839,969
.
13

The bonds authorized in this Section 2 and in Section 16 of
14
this Act are herein called "Bonds".
15

Of the total amount of Bonds authorized in this Act, up to
16
$2,200,000,000 in aggregate original principal amount may be
17
issued and sold in accordance with the Baccalaureate Savings
18
Act in the form of General Obligation College Savings Bonds.
19

Of the total amount of Bonds authorized in this Act, up to
20
$300,000,000 in aggregate original principal amount may be
21
issued and sold in accordance with the Retirement Savings Act
22
in the form of General Obligation Retirement Savings Bonds.
23

Of the total amount of Bonds authorized in this Act, the

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LRB104 18850 RPS 32295 b
1
additional $10,000,000,000 authorized by Public Act 93-2, the
2
$3,466,000,000 authorized by Public Act 96-43, and the
3
$4,096,348,300 authorized by Public Act 96-1497 shall be used
4
solely as provided in Section 7.2.
5

Of the total amount of Bonds authorized in this Act, the
6
additional $6,000,000,000 authorized by Public Act 100-23
7
shall be used solely as provided in Section 7.6 and shall be
8
issued by December 31, 2017.
9

Of the total amount of Bonds authorized in this Act,
10
$2,900,000,000

$2,200,000,000
of the additional amount
11
authorized by Public Act 100-587, Public Act 102-718,
Public
12
Act 104-8, and this amendatory Act of the 104th General
13
Assembly

and this amendatory Act of the 104th General Assembly

14
shall be used solely as provided in Section 7.7.
15

The issuance and sale of Bonds pursuant to the General
16
Obligation Bond Act is an economical and efficient method of
17
financing the long-term capital needs of the State. This Act
18
will permit the issuance of a multi-purpose General Obligation
19
Bond with uniform terms and features. This will not only lower
20
the cost of registration but also reduce the overall cost of
21
issuing debt by improving the marketability of Illinois
22
General Obligation Bonds.
23
(Source: P.A. 103-7, eff. 7-1-23; 103-591, eff. 7-1-24; 104-8,
24
eff. 1-1-26
.)

25

(30 ILCS 330/2.5)

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LRB104 18850 RPS 32295 b
1

Sec. 2.5.
Limitation on issuance of Bonds.
2

(a) Except as provided in subsection (b), no Bonds may be
3
issued if, after the issuance, in the next State fiscal year
4
after the issuance of the Bonds, the amount of debt service
5
(including principal, whether payable at maturity or pursuant
6
to mandatory sinking fund installments, and interest) on all
7
then-outstanding Bonds, other than (i) Bonds authorized by
8
Public Act 100-23, (ii) Bonds issued by Public Act 96-43,
9
(iii) Bonds authorized by Public Act 96-1497, (iv) Bonds
10
authorized by Public Act 100-587,
and
(v) Bonds authorized by
11
this amendatory Act of the 102nd General Assembly,
and (vi)
12
Bonds authorized by this amendatory Act of the 104th General
13
Assembly,
would exceed 7% of the aggregate appropriations from
14
the general funds, the State Construction Account Fund, and
15
the Road Fund for the fiscal year immediately prior to the
16
fiscal year of the issuance. For the purposes of this
17
subsection (a), "general funds" has the same meaning as
18
ascribed to that term under Section 50-40 of the State Budget
19
Law of the Civil Administrative Code of Illinois.
20

(b) If the Comptroller and Treasurer each consent in
21
writing, Bonds may be issued even if the issuance does not
22
comply with subsection (a). In addition, $2,000,000,000 in
23
Bonds for the purposes set forth in Sections 3, 4, 5, 6, and 7,
24
and $2,000,000,000 in Refunding Bonds under Section 16, may be
25
issued during State fiscal year 2017 without complying with
26
subsection (a). In addition, $2,000,000,000 in Bonds for the

SB2950
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LRB104 18850 RPS 32295 b
1
purposes set forth in Sections 3, 4, 5, 6, and 7, and
2
$2,000,000,000 in Refunding Bonds under Section 16, may be
3
issued during State fiscal year 2018 without complying with
4
subsection (a).
5
(Source: P.A. 101-30, eff. 6-28-19; 102-718, eff. 5-5-22.)

6

(30 ILCS 330/7.7)
7

Sec. 7.7.
State Pension Obligation Acceleration Bonds.
8

(a) As used in this Act, "State Pension Obligation
9
Acceleration Bonds" means Bonds authorized by Public Act
10
100-587, Public Act 102-718,
Public Act 104-8, and this
11
amendatory Act of the 104th General Assembly

and this
12
amendatory Act of the 104th General Assembly
and used for the
13
purpose of making accelerated pension benefit payments under
14
Articles 14, 15, and 16 of the Illinois Pension Code.
15

(b) State Pension Obligation Acceleration Bonds in the
16
amount of
$2,900,000,000

$2,200,000,000
are hereby authorized
17
to be used for the purpose of making accelerated pension
18
benefit payments under Articles 14, 15, and 16 of the Illinois
19
Pension Code.
20

(c) The proceeds of State Pension Obligation Acceleration
21
Bonds authorized in subsection (b) of this Section, less the
22
amounts authorized in the Bond Sale Order to be directly paid
23
out for bond sale expenses under Section 8, shall be deposited
24
directly into the State Pension Obligation Acceleration Bond
25
Fund, and the Comptroller and the Treasurer shall, as soon as

SB2950
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LRB104 18850 RPS 32295 b
1
practical, make accelerated pension benefit payments under
2
Articles 14, 15, and 16 of the Illinois Pension Code.
3

(d) There is created the State Pension Obligation
4
Acceleration Bond Fund as a special fund in the State
5
Treasury. Funds deposited in the State Pension Obligation
6
Acceleration Bond Fund may only be used for the purpose of
7
making accelerated pension benefit payments under Articles 14,
8
15, and 16 of the Illinois Pension Code or for the payment of
9
principal and interest due on State Pension Obligation
10
Acceleration Bonds. This subsection shall constitute an
11
irrevocable and continuing appropriation of all amounts
12
necessary for such purposes.
13
(Source: P.A. 104-8, eff. 1-1-26
.)

14

Section 10.
The Illinois Pension Code is amended by
15
changing Sections 14-147.5, 14-147.6, 15-185.5, 15-185.6,
16
16-190.5, and 16-190.6 as follows:

17

(40 ILCS 5/14-147.5)
18

Sec. 14-147.5.
Accelerated pension benefit payment in lieu
19
of any pension benefit.
20

(a) As used in this Section:
21

"Eligible person" means a person who:
22

(1) has terminated service;
23

(2) has accrued sufficient service credit to be
24

eligible to receive a retirement annuity under this

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LRB104 18850 RPS 32295 b
1

Article;
2

(3) has not received any retirement annuity under this
3

Article; and
4

(4) has not made the election under Section 14-147.6.
5

"Pension benefit" means the benefits under this Article,
6
or Article 1 as it relates to those benefits, including any
7
anticipated annual increases, that an eligible person is
8
entitled to upon attainment of the applicable retirement age.
9
"Pension benefit" also includes applicable survivor's or
10
disability benefits.
11

(b) As soon as practical after June 4, 2018 (the effective
12
date of Public Act 100-587), the System shall calculate, using
13
actuarial tables and other assumptions adopted by the Board,
14
the present value of pension benefits for each eligible person
15
who requests that information and shall offer each eligible
16
person the opportunity to irrevocably elect to receive an
17
amount determined by the System to be equal to 60% of the
18
present value of his or her pension benefits in lieu of
19
receiving any pension benefit. The offer shall specify the
20
dollar amount that the eligible person will receive if he or
21
she so elects and shall expire when a subsequent offer is made
22
to an eligible person. An eligible person is limited to one
23
calculation and offer per calendar year. The System shall make
24
a good faith effort to contact every eligible person to notify
25
him or her of the election.
26

Until June 30,
2028

2026
, an eligible person may

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LRB104 18850 RPS 32295 b
1
irrevocably elect to receive an accelerated pension benefit
2
payment in the amount that the System offers under this
3
subsection in lieu of receiving any pension benefit. A person
4
who elects to receive an accelerated pension benefit payment
5
under this Section may not elect to proceed under the
6
Retirement Systems Reciprocal Act with respect to service
7
under this Article.
8

(c) A person's creditable service under this Article shall
9
be terminated upon the person's receipt of an accelerated
10
pension benefit payment under this Section, and no other
11
benefit shall be paid under this Article based on the
12
terminated creditable service, including any retirement,
13
survivor, or other benefit; except that to the extent that
14
participation, benefits, or premiums under the State Employees
15
Group Insurance Act of 1971 are based on the amount of service
16
credit, the terminated service credit shall be used for that
17
purpose.
18

(d) If a person who has received an accelerated pension
19
benefit payment under this Section returns to active service
20
under this Article, then:
21

(1) Any benefits under the System earned as a result
22

of that return to active service shall be based solely on
23

the person's creditable service arising from the return to
24

active service.
25

(2) The accelerated pension benefit payment may not be
26

repaid to the System, and the terminated creditable

SB2950
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LRB104 18850 RPS 32295 b
1

service may not under any circumstances be reinstated.
2

(e) As a condition of receiving an accelerated pension
3
benefit payment, the accelerated pension benefit payment must
4
be transferred into a tax qualified retirement plan or
5
account. The accelerated pension benefit payment under this
6
Section may be subject to withholding or payment of applicable
7
taxes, but to the extent permitted by federal law, a person who
8
receives an accelerated pension benefit payment under this
9
Section must direct the System to pay all of that payment as a
10
rollover into another retirement plan or account qualified
11
under the Internal Revenue Code of 1986, as amended.
12

(f) Upon receipt of a member's irrevocable election to
13
receive an accelerated pension benefit payment under this
14
Section, the System shall submit a voucher to the Comptroller
15
for payment of the member's accelerated pension benefit
16
payment. The Comptroller shall transfer the amount of the
17
voucher from the State Pension Obligation Acceleration Bond
18
Fund to the System, and the System shall transfer the amount
19
into the member's eligible retirement plan or qualified
20
account.
21

(g) The Board shall adopt any rules, including emergency
22
rules, necessary to implement this Section.
23

(h) No provision of this Section shall be interpreted in a
24
way that would cause the applicable System to cease to be a
25
qualified plan under the Internal Revenue Code of 1986.
26
(Source: P.A. 101-10, eff. 6-5-19; 102-718, eff. 5-5-22.)

SB2950
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LRB104 18850 RPS 32295 b
1

(40 ILCS 5/14-147.6)
2

Sec. 14-147.6.
Accelerated pension benefit payment for a
3
reduction in annual retirement annuity and survivor's annuity
4
increases.
5

(a) As used in this Section:
6

"Accelerated pension benefit payment" means a lump sum
7
payment equal to 70% of the difference of the present value of
8
the automatic annual increases to a Tier 1 member's retirement
9
annuity and survivor's annuity using the formula applicable to
10
the Tier 1 member and the present value of the automatic annual
11
increases to the Tier 1 member's retirement annuity using the
12
formula provided under subsection (b-5) and survivor's annuity
13
using the formula provided under subsection (b-6).
14

"Eligible person" means a person who:
15

(1) is a Tier 1 member;
16

(2) has submitted an application for a retirement
17

annuity under this Article;
18

(3) meets the age and service requirements for
19

receiving a retirement annuity under this Article;
20

(4) has not received any retirement annuity under this
21

Article; and
22

(5) has not made the election under Section 14-147.5.
23

(b) As soon as practical after June 4, 2018 (the effective
24
date of Public Act 100-587) and until June 30,
2028

2026
, the
25
System shall implement an accelerated pension benefit payment

SB2950
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LRB104 18850 RPS 32295 b
1
option for eligible persons. Upon the request of an eligible
2
person, the System shall calculate, using actuarial tables and
3
other assumptions adopted by the Board, an accelerated pension
4
benefit payment amount and shall offer that eligible person
5
the opportunity to irrevocably elect to have his or her
6
automatic annual increases in retirement annuity calculated in
7
accordance with the formula provided under subsection (b-5)
8
and any increases in survivor's annuity payable to his or her
9
survivor's annuity beneficiary calculated in accordance with
10
the formula provided under subsection (b-6) in exchange for
11
the accelerated pension benefit payment. The election under
12
this subsection must be made before the eligible person
13
receives the first payment of a retirement annuity otherwise
14
payable under this Article.
15

(b-5) Notwithstanding any other provision of law, the
16
retirement annuity of a person who made the election under
17
subsection (b) shall be subject to annual increases on the
18
January 1 occurring either on or after the attainment of age 67
19
or the first anniversary of the annuity start date, whichever
20
is later. Each annual increase shall be calculated at 1.5% of
21
the originally granted retirement annuity.
22

(b-6) Notwithstanding any other provision of law, a
23
survivor's annuity payable to a survivor's annuity beneficiary
24
of a person who made the election under subsection (b) shall be
25
subject to annual increases on the January 1 occurring on or
26
after the first anniversary of the commencement of the

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1
annuity. Each annual increase shall be calculated at 1.5% of
2
the originally granted survivor's annuity.
3

(c) If a person who has received an accelerated pension
4
benefit payment returns to active service under this Article,
5
then:
6

(1) the calculation of any future automatic annual
7

increase in retirement annuity shall be calculated in
8

accordance with the formula provided under subsection
9

(b-5); and
10

(2) the accelerated pension benefit payment may not be
11

repaid to the System.
12

(d) As a condition of receiving an accelerated pension
13
benefit payment, the accelerated pension benefit payment must
14
be transferred into a tax qualified retirement plan or
15
account. The accelerated pension benefit payment under this
16
Section may be subject to withholding or payment of applicable
17
taxes, but to the extent permitted by federal law, a person who
18
receives an accelerated pension benefit payment under this
19
Section must direct the System to pay all of that payment as a
20
rollover into another retirement plan or account qualified
21
under the Internal Revenue Code of 1986, as amended.
22

(d-5) Upon receipt of a member's irrevocable election to
23
receive an accelerated pension benefit payment under this
24
Section, the System shall submit a voucher to the Comptroller
25
for payment of the member's accelerated pension benefit
26
payment. The Comptroller shall transfer the amount of the

SB2950
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LRB104 18850 RPS 32295 b
1
voucher to the System, and the System shall transfer the
2
amount into a member's eligible retirement plan or qualified
3
account.
4

(e) The Board shall adopt any rules, including emergency
5
rules, necessary to implement this Section.
6

(f) No provision of this Section shall be interpreted in a
7
way that would cause the applicable System to cease to be a
8
qualified plan under the Internal Revenue Code of 1986.
9
(Source: P.A. 101-10, eff. 6-5-19; 102-718, eff. 5-5-22.)

10

(40 ILCS 5/15-185.5)
11

Sec. 15-185.5.
Accelerated pension benefit payment in lieu
12
of any pension benefit.
13

(a) As used in this Section:
14

"Eligible person" means a person who:
15

(1) has terminated service;
16

(2) has accrued sufficient service credit to be
17

eligible to receive a retirement annuity under this
18

Article;
19

(3) has not received any retirement annuity under this
20

Article;
21

(4) has not made the election under Section 15-185.6;
22

and
23

(5) is not a participant in the self-managed plan
24

under Section 15-158.2.
25

"Implementation date" means the earliest date upon which

SB2950
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LRB104 18850 RPS 32295 b
1
the Board authorizes eligible persons to begin irrevocably
2
electing the accelerated pension benefit payment option under
3
this Section. The Board shall endeavor to make such
4
participation available as soon as possible after June 4, 2018
5
(the effective date of Public Act 100-587) and shall establish
6
an implementation date by Board resolution.
7

"Pension benefit" means the benefits under this Article,
8
or Article 1 as it relates to those benefits, including any
9
anticipated annual increases, that an eligible person is
10
entitled to upon attainment of the applicable retirement age.
11
"Pension benefit" also includes applicable survivors benefits,
12
disability benefits, or disability retirement annuity
13
benefits.
14

(b) Beginning on the implementation date, the System shall
15
offer each eligible person the opportunity to irrevocably
16
elect to receive an amount determined by the System to be equal
17
to 60% of the present value of his or her pension benefits in
18
lieu of receiving any pension benefit. The System shall
19
calculate, using actuarial tables and other assumptions
20
adopted by the Board, the present value of pension benefits
21
for each eligible person upon his or her request in writing to
22
the System. The System shall not perform more than one
23
calculation per eligible member in a State fiscal year. The
24
offer shall specify the dollar amount that the eligible person
25
will receive if he or she so elects and shall expire when a
26
subsequent offer is made to an eligible person. The System

SB2950
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1
shall make a good faith effort to contact every eligible
2
person to notify him or her of the election.
3

Beginning on the implementation date and until June 30,
4
2028

2026
, an eligible person may irrevocably elect to receive
5
an accelerated pension benefit payment in the amount that the
6
System offers under this subsection in lieu of receiving any
7
pension benefit. A person who elects to receive an accelerated
8
pension benefit payment under this Section may not elect to
9
proceed under the Retirement Systems Reciprocal Act with
10
respect to service under this Article.
11

(c) Upon payment of an accelerated pension benefit payment
12
under this Section, the person forfeits all accrued rights and
13
credits in the System and no other benefit shall be paid under
14
this Article based on those forfeited rights and credits,
15
including any retirement, survivor, or other benefit; except
16
that to the extent that participation, benefits, or premiums
17
under the State Employees Group Insurance Act of 1971 are
18
based on the amount of service credit, the terminated service
19
credit shall be used for that purpose.
20

(d) If a person who has received an accelerated pension
21
benefit payment under this Section returns to participation
22
under this Article, any benefits under the System earned as a
23
result of that return to participation shall be based solely
24
on the person's credits and creditable service arising from
25
the return to participation. Upon return to participation, the
26
person shall be considered a new employee subject to all the

SB2950
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LRB104 18850 RPS 32295 b
1
qualifying conditions for participation and eligibility for
2
benefits applicable to new employees.
3

(d-5) The accelerated pension benefit payment may not be
4
repaid to the System, and the forfeited rights and credits may
5
not under any circumstances be reinstated.
6

(e) As a condition of receiving an accelerated pension
7
benefit payment, the accelerated pension benefit payment must
8
be deposited into a tax qualified retirement plan or account
9
identified by the eligible person at the time of the election.
10
The accelerated pension benefit payment under this Section may
11
be subject to withholding or payment of applicable taxes, but
12
to the extent permitted by federal law, a person who receives
13
an accelerated pension benefit payment under this Section must
14
direct the System to pay all of that payment as a rollover into
15
another retirement plan or account qualified under the
16
Internal Revenue Code of 1986, as amended.
17

(f) The System shall submit vouchers to the State
18
Comptroller for the payment of accelerated pension benefit
19
payments under this Section. The State Comptroller shall pay
20
the amounts of the vouchers from the State Pension Obligation
21
Acceleration Bond Fund to the System, and the System shall
22
deposit the amounts into the applicable tax qualified plans or
23
accounts.
24

(g) The Board shall adopt any rules, including emergency
25
rules, necessary to implement this Section.
26

(h) No provision of this Section shall be interpreted in a

SB2950
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LRB104 18850 RPS 32295 b
1
way that would cause the System to cease to be a qualified plan
2
under the Internal Revenue Code of 1986.
3
(Source: P.A. 101-10, eff. 6-5-19; 102-718, eff. 5-5-22.)

4

(40 ILCS 5/15-185.6)
5

Sec. 15-185.6.
Accelerated pension benefit payment for a
6
reduction in an annual increase to a retirement annuity and an
7
annuity benefit payable as a result of death.
8

(a) As used in this Section:
9

"Accelerated pension benefit payment" means a lump sum
10
payment equal to 70% of the difference of: (i) the present
11
value of the automatic annual increases to a Tier 1 member's
12
retirement annuity, including any increases to any annuity
13
benefit payable as a result of his or her death, using the
14
formula applicable to the Tier 1 member; and (ii) the present
15
value of the automatic annual increases to the Tier 1 member's
16
retirement annuity, including any increases to any annuity
17
benefit payable as a result of his or her death, using the
18
formula provided under subsection (b-5).
19

"Eligible person" means a person who:
20

(1) is a Tier 1 member;
21

(2) has submitted an application for a retirement
22

annuity under this Article;
23

(3) meets the age and service requirements for
24

receiving a retirement annuity under this Article;
25

(4) has not received any retirement annuity under this

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LRB104 18850 RPS 32295 b
1

Article;
2

(5) has not made the election under Section 15-185.5;
3

and
4

(6) is not a participant in the self-managed plan
5

under Section 15-158.2.
6

"Implementation date" means the earliest date upon which
7
the Board authorizes eligible persons to begin irrevocably
8
electing the accelerated pension benefit payment option under
9
this Section. The Board shall endeavor to make such
10
participation available as soon as possible after June 4, 2018
11
(the effective date of Public Act 100-587) and shall establish
12
an implementation date by Board resolution.
13

(b) Beginning on the implementation date and until June
14
30,
2028

2026
, the System shall implement an accelerated
15
pension benefit payment option for eligible persons. The
16
System shall calculate, using actuarial tables and other
17
assumptions adopted by the Board, an accelerated pension
18
benefit payment amount for an eligible person upon his or her
19
request in writing to the System and shall offer that eligible
20
person the opportunity to irrevocably elect to have his or her
21
automatic annual increases in retirement annuity and any
22
annuity benefit payable as a result of his or her death
23
calculated in accordance with the formula provided in
24
subsection (b-5) in exchange for the accelerated pension
25
benefit payment. The System shall not perform more than one
26
calculation under this Section per eligible person in a State

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LRB104 18850 RPS 32295 b
1
fiscal year. The election under this subsection must be made
2
before any retirement annuity is paid to the eligible person,
3
and the eligible survivor, spouse, or contingent annuitant, as
4
applicable, must consent to the election under this
5
subsection.
6

(b-5) Notwithstanding any other provision of law, the
7
retirement annuity of a person who made the election under
8
subsection (b) shall be increased annually beginning on the
9
January 1 occurring either on or after the attainment of age 67
10
or the first anniversary of the annuity start date, whichever
11
is later, and any annuity benefit payable as a result of his or
12
her death shall be increased annually beginning on: (1) the
13
January 1 occurring on or after the commencement of the
14
annuity if the deceased Tier 1 member died while receiving a
15
retirement annuity; or (2) the January 1 occurring after the
16
first anniversary of the commencement of the benefit. Each
17
annual increase shall be calculated at 1.5% of the originally
18
granted retirement annuity or annuity benefit payable as a
19
result of the Tier 1 member's death.
20

(c) If an annuitant who has received an accelerated
21
pension benefit payment returns to participation under this
22
Article, the calculation of any future automatic annual
23
increase in retirement annuity under subsection (c) of Section
24
15-139 shall be calculated in accordance with the formula
25
provided in subsection (b-5).
26

(c-5) The accelerated pension benefit payment may not be

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LRB104 18850 RPS 32295 b
1
repaid to the System.
2

(d) As a condition of receiving an accelerated pension
3
benefit payment, the accelerated pension benefit payment must
4
be deposited into a tax qualified retirement plan or account
5
identified by the eligible person at the time of election. The
6
accelerated pension benefit payment under this Section may be
7
subject to withholding or payment of applicable taxes, but to
8
the extent permitted by federal law, a person who receives an
9
accelerated pension benefit payment under this Section must
10
direct the System to pay all of that payment as a rollover into
11
another retirement plan or account qualified under the
12
Internal Revenue Code of 1986, as amended.
13

(d-5) The System shall submit vouchers to the State
14
Comptroller for the payment of accelerated pension benefit
15
payments under this Section. The State Comptroller shall pay
16
the amounts of the vouchers from the State Pension Obligation
17
Acceleration Bond Fund to the System, and the System shall
18
deposit the amounts into the applicable tax qualified plans or
19
accounts.
20

(e) The Board shall adopt any rules, including emergency
21
rules, necessary to implement this Section.
22

(f) No provision of this Section shall be interpreted in a
23
way that would cause the System to cease to be a qualified plan
24
under the Internal Revenue Code of 1986.
25
(Source: P.A. 101-10, eff. 6-5-19; 102-718, eff. 5-5-22.)

SB2950
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LRB104 18850 RPS 32295 b
1

(40 ILCS 5/16-190.5)
2

Sec. 16-190.5.
Accelerated pension benefit payment in lieu
3
of any pension benefit.
4

(a) As used in this Section:
5

"Eligible person" means a person who:
6

(1) has terminated service;
7

(2) has accrued sufficient service credit to be
8

eligible to receive a retirement annuity under this
9

Article;
10

(3) has not received any retirement annuity under this
11

Article; and
12

(4) has not made the election under Section 16-190.6.
13

"Pension benefit" means the benefits under this Article,
14
or Article 1 as it relates to those benefits, including any
15
anticipated annual increases, that an eligible person is
16
entitled to upon attainment of the applicable retirement age.
17
"Pension benefit" also includes applicable survivor's or
18
disability benefits.
19

(b) As soon as practical after June 4, 2018 (the effective
20
date of Public Act 100-587), the System shall calculate, using
21
actuarial tables and other assumptions adopted by the Board,
22
the present value of pension benefits for each eligible person
23
who requests that information and shall offer each eligible
24
person the opportunity to irrevocably elect to receive an
25
amount determined by the System to be equal to 60% of the
26
present value of his or her pension benefits in lieu of

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LRB104 18850 RPS 32295 b
1
receiving any pension benefit. The offer shall specify the
2
dollar amount that the eligible person will receive if he or
3
she so elects and shall expire when a subsequent offer is made
4
to an eligible person. The System shall make a good faith
5
effort to contact every eligible person to notify him or her of
6
the election.
7

Until June 30,
2028

2026
, an eligible person may
8
irrevocably elect to receive an accelerated pension benefit
9
payment in the amount that the System offers under this
10
subsection in lieu of receiving any pension benefit. A person
11
who elects to receive an accelerated pension benefit payment
12
under this Section may not elect to proceed under the
13
Retirement Systems Reciprocal Act with respect to service
14
under this Article.
15

(c) A person's creditable service under this Article shall
16
be terminated upon the person's receipt of an accelerated
17
pension benefit payment under this Section, and no other
18
benefit shall be paid under this Article based on the
19
terminated creditable service, including any retirement,
20
survivor, or other benefit; except that to the extent that
21
participation, benefits, or premiums under the State Employees
22
Group Insurance Act of 1971 are based on the amount of service
23
credit, the terminated service credit shall be used for that
24
purpose.
25

(d) If a person who has received an accelerated pension
26
benefit payment under this Section returns to active service

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LRB104 18850 RPS 32295 b
1
under this Article, then:
2

(1) Any benefits under the System earned as a result
3

of that return to active service shall be based solely on
4

the person's creditable service arising from the return to
5

active service.
6

(2) The accelerated pension benefit payment may not be
7

repaid to the System, and the terminated creditable
8

service may not under any circumstances be reinstated.
9

(e) As a condition of receiving an accelerated pension
10
benefit payment, the accelerated pension benefit payment must
11
be transferred into a tax qualified retirement plan or
12
account. The accelerated pension benefit payment under this
13
Section may be subject to withholding or payment of applicable
14
taxes, but to the extent permitted by federal law, a person who
15
receives an accelerated pension benefit payment under this
16
Section must direct the System to pay all of that payment as a
17
rollover into another retirement plan or account qualified
18
under the Internal Revenue Code of 1986, as amended.
19

(f) Upon receipt of a member's irrevocable election to
20
receive an accelerated pension benefit payment under this
21
Section, the System shall submit a voucher to the Comptroller
22
for payment of the member's accelerated pension benefit
23
payment. The Comptroller shall transfer the amount of the
24
voucher from the State Pension Obligation Acceleration Bond
25
Fund to the System, and the System shall transfer the amount
26
into the member's eligible retirement plan or qualified

SB2950
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LRB104 18850 RPS 32295 b
1
account.
2

(g) The Board shall adopt any rules, including emergency
3
rules, necessary to implement this Section.
4

(h) No provision of Public Act 100-587 shall be
5
interpreted in a way that would cause the applicable System to
6
cease to be a qualified plan under the Internal Revenue Code of
7
1986.
8
(Source: P.A. 101-10, eff. 6-5-19; 102-558, eff. 8-20-21;
9
102-718, eff. 5-5-22.)

10

(40 ILCS 5/16-190.6)
11

Sec. 16-190.6.
Accelerated pension benefit payment for a
12
reduction in annual retirement annuity and survivor's annuity
13
increases.
14

(a) As used in this Section:
15

"Accelerated pension benefit payment" means a lump sum
16
payment equal to 70% of the difference of the present value of
17
the automatic annual increases to a Tier 1 member's retirement
18
annuity and survivor's annuity using the formula applicable to
19
the Tier 1 member and the present value of the automatic annual
20
increases to the Tier 1 member's retirement annuity using the
21
formula provided under subsection (b-5) and the survivor's
22
annuity using the formula provided under subsection (b-6).
23

"Eligible person" means a person who:
24

(1) is a Tier 1 member;
25

(2) has submitted an application for a retirement

SB2950
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LRB104 18850 RPS 32295 b
1

annuity under this Article;
2

(3) meets the age and service requirements for
3

receiving a retirement annuity under this Article;
4

(4) has not received any retirement annuity under this
5

Article; and
6

(5) has not made the election under Section 16-190.5.
7

(b) As soon as practical after June 4, 2018
(
the effective
8
date of Public Act 100-587) and until June 30,
2028

2026
, the
9
System shall implement an accelerated pension benefit payment
10
option for eligible persons. Upon the request of an eligible
11
person, the System shall calculate, using actuarial tables and
12
other assumptions adopted by the Board, an accelerated pension
13
benefit payment amount and shall offer that eligible person
14
the opportunity to irrevocably elect to have his or her
15
automatic annual increases in retirement annuity calculated in
16
accordance with the formula provided under subsection (b-5)
17
and any increases in survivor's annuity payable to his or her
18
survivor's annuity beneficiary calculated in accordance with
19
the formula provided under subsection (b-6) in exchange for
20
the accelerated pension benefit payment. The election under
21
this subsection must be made before the eligible person
22
receives the first payment of a retirement annuity otherwise
23
payable under this Article.
24

(b-5) Notwithstanding any other provision of law, the
25
retirement annuity of a person who made the election under
26
subsection (b) shall be subject to annual increases on the

SB2950
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LRB104 18850 RPS 32295 b
1
January 1 occurring either on or after the attainment of age 67
2
or the first anniversary of the annuity start date, whichever
3
is later. Each annual increase shall be calculated at 1.5% of
4
the originally granted retirement annuity.
5

(b-6) Notwithstanding any other provision of law, a
6
survivor's annuity payable to a survivor's annuity beneficiary
7
of a person who made the election under subsection (b) shall be
8
subject to annual increases on the January 1 occurring on or
9
after the first anniversary of the commencement of the
10
annuity. Each annual increase shall be calculated at 1.5% of
11
the originally granted survivor's annuity.
12

(c) If a person who has received an accelerated pension
13
benefit payment returns to active service under this Article,
14
then:
15

(1) the calculation of any future automatic annual
16

increase in retirement annuity shall be calculated in
17

accordance with the formula provided in subsection (b-5);
18

and
19

(2) the accelerated pension benefit payment may not be
20

repaid to the System.
21

(d) As a condition of receiving an accelerated pension
22
benefit payment, the accelerated pension benefit payment must
23
be transferred into a tax qualified retirement plan or
24
account. The accelerated pension benefit payment under this
25
Section may be subject to withholding or payment of applicable
26
taxes, but to the extent permitted by federal law, a person who

SB2950
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LRB104 18850 RPS 32295 b
1
receives an accelerated pension benefit payment under this
2
Section must direct the System to pay all of that payment as a
3
rollover into another retirement plan or account qualified
4
under the Internal Revenue Code of 1986, as amended.
5

(d-5) Upon receipt of a member's irrevocable election to
6
receive an accelerated pension benefit payment under this
7
Section, the System shall submit a voucher to the Comptroller
8
for payment of the member's accelerated pension benefit
9
payment. The Comptroller shall transfer the amount of the
10
voucher from the State Pension Obligation Acceleration Bond
11
Fund to the System, and the System shall transfer the amount
12
into the member's eligible retirement plan or qualified
13
account.
14

(e) The Board shall adopt any rules, including emergency
15
rules, necessary to implement this Section.
16

(f) No provision of this Section shall be interpreted in a
17
way that would cause the applicable System to cease to be a
18
qualified plan under the Internal Revenue Code of 1986.
19
(Source: P.A. 101-10, eff. 6-5-19; 102-718, eff. 5-5-22;
20
revised 6-26-25.)

21

Section 99.
Effective date.
This Act takes effect upon
22
becoming law.

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