PEN CD-ACCEL BENEFIT PAYMENT

Illinois General Assembly - Full Text of SB3430

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB3430

Introduced 2/4/2026, by Sen. Chris Balkema

SYNOPSIS AS INTRODUCED:

See Index

Amends the Downstate Police, Downstate Firefighter, Chicago Police,
Chicago Firefighter, Illinois Municipal Retirement Fund (IMRF), Chicago
Municipal, and Chicago Laborers Articles of the Illinois Pension Code.
Establishes an accelerated pension benefit payment in lieu of any pension
benefit under which an eligible person may elect to receive an amount
determined by the Fund to be equal to 60% of the present value of his or
her pension benefits in lieu of receiving any pension benefit. Establishes
an accelerated pension benefit payment for a reduction in annual
retirement annuity and survivor's annuity increases, as applicable, under
which a Tier 1 member may elect to receive an accelerated pension benefit
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 a specified formula and survivor's annuity using
a specified formula. Amends the General Obligation Bond Act to authorize
$700,000,000 to be sold to pay for the accelerated pension benefit
payments. Provides that the Comptroller shall deduct the amount for the
payment of principal and interest due on Local Pension Obligation
Acceleration Bonds from any payment out of the Local Government
Distributive Fund to the employer and shall pay the amount so deducted
toward the principal and interest due on Local Pension Obligation Bonds.
Amends the State Finance Act to make a conforming change. Amends the State
Mandates Act to require implementation without reimbursement. Effective
immediately.
LRB104 19288 RPS 32734 b
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT
MAY APPLY

A BILL FOR

SB3430
LRB104 19288 RPS 32734 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 1.
The State Finance Act is amended by adding
5
Section 5.1038 as follows:

6

(30 ILCS 105/5.1038 new)
7

Sec. 5.1038.
The Local Pension Obligation Acceleration
8
Bond Fund.

9

Section 5.
The General Obligation Bond Act is amended by
10
changing Sections 2 and 2.5 and by adding Section 7.8 as
11
follows:

12

(30 ILCS 330/2)

(from Ch. 127, par. 652)
13

Sec. 2.
Authorization for Bonds.
The State of Illinois is
14
authorized to issue, sell and provide for the retirement of
15
General Obligation Bonds of the State of Illinois for the
16
categories and specific purposes expressed in Sections 2
17
through 8 of this Act, in the total amount of
$83,364,839,969

18
$82,664,839,969
.
19

The bonds authorized in this Section 2 and in Section 16 of
20
this Act are herein called "Bonds".
21

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

SB3430
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LRB104 19288 RPS 32734 b
1
$2,200,000,000 in aggregate original principal amount may be
2
issued and sold in accordance with the Baccalaureate Savings
3
Act in the form of General Obligation College Savings Bonds.
4

Of the total amount of Bonds authorized in this Act, up to
5
$300,000,000 in aggregate original principal amount may be
6
issued and sold in accordance with the Retirement Savings Act
7
in the form of General Obligation Retirement Savings Bonds.
8

Of the total amount of Bonds authorized in this Act, the
9
additional $10,000,000,000 authorized by Public Act 93-2, the
10
$3,466,000,000 authorized by Public Act 96-43, and the
11
$4,096,348,300 authorized by Public Act 96-1497 shall be used
12
solely as provided in Section 7.2.
13

Of the total amount of Bonds authorized in this Act, the
14
additional $6,000,000,000 authorized by Public Act 100-23
15
shall be used solely as provided in Section 7.6 and shall be
16
issued by December 31, 2017.
17

Of the total amount of Bonds authorized in this Act,
18
$2,200,000,000 of the additional amount authorized by Public
19
Act 100-587, Public Act 102-718, and this amendatory Act of
20
the 104th General Assembly shall be used solely as provided in
21
Section 7.7.
22

Of the total amount of Bonds authorized in this Act,
23
$700,000,000 of the additional amount authorized by this
24
amendatory Act of the 104th General Assembly shall be used
25
solely as provided in Section 7.8.
26

The issuance and sale of Bonds pursuant to the General

SB3430
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LRB104 19288 RPS 32734 b
1
Obligation Bond Act is an economical and efficient method of
2
financing the long-term capital needs of the State. This Act
3
will permit the issuance of a multi-purpose General Obligation
4
Bond with uniform terms and features. This will not only lower
5
the cost of registration but also reduce the overall cost of
6
issuing debt by improving the marketability of Illinois
7
General Obligation Bonds.
8
(Source: P.A. 103-7, eff. 7-1-23; 103-591, eff. 7-1-24; 104-8,
9
eff. 1-1-26
.)

10

(30 ILCS 330/2.5)
11

Sec. 2.5.
Limitation on issuance of Bonds.
12

(a) Except as provided in subsection (b), no Bonds may be
13
issued if, after the issuance, in the next State fiscal year
14
after the issuance of the Bonds, the amount of debt service
15
(including principal, whether payable at maturity or pursuant
16
to mandatory sinking fund installments, and interest) on all
17
then-outstanding Bonds, other than (i) Bonds authorized by
18
Public Act 100-23, (ii) Bonds issued by Public Act 96-43,
19
(iii) Bonds authorized by Public Act 96-1497, (iv) Bonds
20
authorized by Public Act 100-587,
and
(v) Bonds authorized by
21
Public Act 102-718

this amendatory Act of the 102nd General
22
Assembly
,
and (vi) Bonds authorized by this amendatory Act of
23
the 104th General Assembly,
would exceed 7% of the aggregate
24
appropriations from the general funds, the State Construction
25
Account Fund, and the Road Fund for the fiscal year

SB3430
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LRB104 19288 RPS 32734 b
1
immediately prior to the fiscal year of the issuance. For the
2
purposes of this subsection (a), "general funds" has the same
3
meaning as ascribed to that term under Section 50-40 of the
4
State Budget Law of the Civil Administrative Code of Illinois.
5

(b) If the Comptroller and Treasurer each consent in
6
writing, Bonds may be issued even if the issuance does not
7
comply with subsection (a). In addition, $2,000,000,000 in
8
Bonds for the purposes set forth in Sections 3, 4, 5, 6, and 7,
9
and $2,000,000,000 in Refunding Bonds under Section 16, may be
10
issued during State fiscal year 2017 without complying with
11
subsection (a). In addition, $2,000,000,000 in Bonds for the
12
purposes set forth in Sections 3, 4, 5, 6, and 7, and
13
$2,000,000,000 in Refunding Bonds under Section 16, may be
14
issued during State fiscal year 2018 without complying with
15
subsection (a).
16
(Source: P.A. 101-30, eff. 6-28-19; 102-718, eff. 5-5-22.)

17

(30 ILCS 330/7.8 new)
18

Sec. 7.8.
Local Pension Obligation Acceleration Bonds.
19

(a) As used in this Section, "Local Pension Obligation
20
Acceleration Bonds" means Bonds authorized by this amendatory
21
Act of the 104th General Assembly and used for the purpose of
22
making accelerated pension benefit payments under Articles 3,
23
4, 5, 6, 7, 8, and 11 of the Illinois Pension Code.
24

(b) Local Pension Obligation Acceleration Bonds in the
25
amount of $700,000,000 are hereby authorized to be used for

SB3430
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LRB104 19288 RPS 32734 b
1
the purpose of making accelerated pension benefit payments
2
under Articles 3, 4, 5, 6, 7, 8, and 11 of the Illinois Pension
3
Code.
4

(c) The proceeds of Local Pension Obligation Acceleration
5
Bonds authorized in subsection (b) of this Section, less the
6
amounts authorized in the Bond Sale Order to be directly paid
7
out for bond sale expenses under Section 8, shall be deposited
8
directly into the Local Pension Obligation Acceleration Bond
9
Fund, and the Comptroller and the Treasurer shall, as soon as
10
practical, make accelerated pension benefit payments under
11
Articles 3, 4, 5, 6, 7, 8, and 11 of the Illinois Pension Code.
12

(d) There is created the Local Pension Obligation
13
Acceleration Bond Fund as a special fund in the State
14
treasury. Funds deposited into the Local Pension Obligation
15
Acceleration Bond Fund may only be used for the purpose of
16
making accelerated pension benefit payments under Articles 3,
17
4, 5, 6, 7, 8, and 11 of the Illinois Pension Code. This
18
subsection shall constitute an irrevocable and continuing
19
appropriation of all amounts necessary for such purposes.
20

(e) The Comptroller shall deduct the amount for the
21
payment of principal and interest due on Local Pension
22
Obligation Acceleration Bonds from any payment out of the
23
Local Government Distributive Fund to the employer and shall
24
pay the amount so deducted toward the principal and interest
25
due on Local Pension Obligation Bonds.

SB3430
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LRB104 19288 RPS 32734 b
1

Section 10.
The Illinois Pension Code is amended by adding
2
Sections 3-144.3, 3-144.4, 4-138.15, 4-138.16, 5-218.5,
3
5-218.6, 6-213.5, 6-213.6, 7-217.5, 7-217.6, 8-244.5, 8-244.6,
4
11-223.5, and 11-223.6 as follows:

5

(40 ILCS 5/3-144.3 new)
6

Sec. 3-144.3.
Accelerated pension benefit payment in lieu
7
of any pension benefit.
8

(a) As used in this Section:
9

"Eligible person" means a person who:
10

(1) has terminated service;
11

(2) has accrued sufficient service credit to be
12

eligible to receive a retirement pension under this
13

Article;
14

(3) has not received any retirement pension under this
15

Article; and
16

(4) has not made the election under Section 3-144.4.
17

"Pension benefit" means the benefits under this Article,
18
or Article 1 as it relates to those benefits, including any
19
anticipated annual increases, that an eligible person is
20
entitled to upon attainment of the applicable retirement age.
21
"Pension benefit" also includes applicable survivor's or
22
disability benefits.
23

(b) As soon as practical after the effective date of this
24
amendatory Act of the 104th General Assembly, the fund shall
25
calculate, using actuarial tables and other assumptions

SB3430
- 7 -
LRB104 19288 RPS 32734 b
1
adopted by the Board, the present value of pension benefits
2
for each eligible person who requests that information and
3
shall offer each eligible person the opportunity to
4
irrevocably elect to receive an amount determined by the fund
5
to be equal to 60% of the present value of his or her pension
6
benefits in lieu of receiving any pension benefit. The offer
7
shall specify the dollar amount that the eligible person will
8
receive if he or she so elects and shall expire when a
9
subsequent offer is made to an eligible person. An eligible
10
person is limited to one calculation and offer per calendar
11
year. The fund shall make a good faith effort to contact every
12
eligible person to notify him or her of the election.
13

Until June 30, 2030, an eligible person may irrevocably
14
elect to receive an accelerated pension benefit payment in the
15
amount that the fund offers under this subsection in lieu of
16
receiving any pension benefit.
17

(c) A person's creditable service under this Article shall
18
be terminated upon the person's receipt of an accelerated
19
pension benefit payment under this Section, and no other
20
benefit shall be paid under this Article based on the
21
terminated creditable service, including any retirement,
22
survivor, or other benefit.
23

(d) If a person who has received an accelerated pension
24
benefit payment under this Section returns to active service
25
under this Article, then:
26

(1) Any benefits under the fund earned as a result of

SB3430
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LRB104 19288 RPS 32734 b
1

that return to active service shall be based solely on the
2

person's creditable service arising from the return to
3

active service.
4

(2) The accelerated pension benefit payment may not be
5

repaid to the fund, and the terminated creditable service
6

may not under any circumstances be reinstated.
7

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

(f) Upon receipt of a member's irrevocable election to
18
receive an accelerated pension benefit payment under this
19
Section, the fund shall submit a voucher to the Comptroller
20
for payment of the member's accelerated pension benefit
21
payment. The Comptroller shall transfer the amount of the
22
voucher from the Local Pension Obligation Acceleration Bond
23
Fund to the fund, and the fund shall transfer the amount into
24
the member's eligible retirement plan or qualified account.
25

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

SB3430
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LRB104 19288 RPS 32734 b
1

(h) No provision of this Section shall be interpreted in a
2
way that would cause the applicable fund to cease to be a
3
qualified plan under the Internal Revenue Code of 1986.

4

(40 ILCS 5/3-144.4 new)
5

Sec. 3-144.4.
Accelerated pension benefit payment for a
6
reduction in annual retirement pension increases.
7

(a) As used in this Section:
8

"Accelerated pension benefit payment" means a lump-sum
9
payment equal to 70% of the difference of the present value of
10
the automatic annual increases to a Tier 1 member's retirement
11
pension using the formula applicable to the Tier 1 member and
12
the present value of the automatic annual increases to the
13
Tier 1 member's retirement pension using the formula provided
14
under subsection (b-5).
15

"Eligible person" means a person who:
16

(1) is a Tier 1 member;
17

(2) has submitted an application for a retirement
18

pension under this Article;
19

(3) meets the age and service requirements for
20

receiving a retirement pension under this Article;
21

(4) has not received any retirement pension under this
22

Article; and
23

(5) has not made the election under Section 3-144.3.
24

"Tier 1 member" means a person who first became a police
25
officer under this Article before January 1, 2011.

SB3430
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LRB104 19288 RPS 32734 b
1

(b) As soon as practical after the effective date of this
2
amendatory Act of the 104th General Assembly and until June
3
30, 2030, the fund shall implement an accelerated pension
4
benefit payment option for eligible persons. Upon the request
5
of an eligible person, the fund shall calculate, using
6
actuarial tables and other assumptions adopted by the Board,
7
an accelerated pension benefit payment amount and shall offer
8
that eligible person the opportunity to irrevocably elect to
9
have his or her automatic annual increases in retirement
10
pension calculated in accordance with the formula provided
11
under subsection (b-5) in exchange for the accelerated pension
12
benefit payment. The election under this subsection must be
13
made before the eligible person receives the first payment of
14
a retirement pension otherwise payable under this Article.
15

(b-5) Notwithstanding any other provision of law, the
16
retirement pension 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 pension start date, whichever
20
is later. Each annual increase shall be calculated at 1.5% of
21
the originally granted retirement pension.
22

(c) If a person who has received an accelerated pension
23
benefit payment returns to active service under this Article,
24
then:
25

(1) the calculation of any future automatic annual
26

increase in retirement pension shall be calculated in

SB3430
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LRB104 19288 RPS 32734 b
1

accordance with the formula provided under subsection
2

(b-5); and
3

(2) the accelerated pension benefit payment may not be
4

repaid to the fund.
5

(d) As a condition of receiving an accelerated pension
6
benefit payment, the accelerated pension benefit payment must
7
be transferred into a tax qualified retirement plan or
8
account. The accelerated pension benefit payment under this
9
Section may be subject to withholding or payment of applicable
10
taxes, but to the extent permitted by federal law, a person who
11
receives an accelerated pension benefit payment under this
12
Section must direct the fund to pay all of that payment as a
13
rollover into another retirement plan or account qualified
14
under the Internal Revenue Code of 1986, as amended.
15

(d-5) Upon receipt of a member's irrevocable election to
16
receive an accelerated pension benefit payment under this
17
Section, the fund shall submit a voucher to the Comptroller
18
for payment of the member's accelerated pension benefit
19
payment. The Comptroller shall transfer the amount of the
20
voucher to the fund, and the fund shall transfer the amount
21
into a member's eligible retirement plan or qualified account.
22

(e) The Board shall adopt any rules, including emergency
23
rules, necessary to implement this Section.
24

(f) No provision of this Section shall be interpreted in a
25
way that would cause the applicable fund to cease to be a
26
qualified plan under the Internal Revenue Code of 1986.

SB3430
- 12 -
LRB104 19288 RPS 32734 b
1

(40 ILCS 5/4-138.15 new)
2

Sec. 4-138.15.
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 pension under this
9

Article;
10

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

Article;
12

(4) has not made the election under Section 4-138.16;
13

and
14

(5) is the employee of a unit of local government that
15

receives payments out of the Local Government Distributive
16

Fund.
17

"Pension benefit" means the benefits under this Article,
18
or Article 1 as it relates to those benefits, including any
19
anticipated annual increases, that an eligible person is
20
entitled to upon attainment of the applicable retirement age.
21
"Pension benefit" also includes applicable survivor's or
22
disability benefits.
23

(b) As soon as practical after the effective date of this
24
amendatory Act of the 104th General Assembly, the fund shall
25
calculate, using actuarial tables and other assumptions

SB3430
- 13 -
LRB104 19288 RPS 32734 b
1
adopted by the Board, the present value of pension benefits
2
for each eligible person who requests that information and
3
shall offer each eligible person the opportunity to
4
irrevocably elect to receive an amount determined by the fund
5
to be equal to 60% of the present value of his or her pension
6
benefits in lieu of receiving any pension benefit. The offer
7
shall specify the dollar amount that the eligible person will
8
receive if he or she so elects and shall expire when a
9
subsequent offer is made to an eligible person. An eligible
10
person is limited to one calculation and offer per calendar
11
year. The fund shall make a good faith effort to contact every
12
eligible person to notify him or her of the election.
13

Until June 30, 2030, an eligible person may irrevocably
14
elect to receive an accelerated pension benefit payment in the
15
amount that the fund offers under this subsection in lieu of
16
receiving any pension benefit.
17

(c) A person's creditable service under this Article shall
18
be terminated upon the person's receipt of an accelerated
19
pension benefit payment under this Section, and no other
20
benefit shall be paid under this Article based on the
21
terminated creditable service, including any retirement,
22
survivor, or other benefit.
23

(d) If a person who has received an accelerated pension
24
benefit payment under this Section returns to active service
25
under this Article, then:
26

(1) Any benefits under the fund earned as a result of

SB3430
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LRB104 19288 RPS 32734 b
1

that return to active service shall be based solely on the
2

person's creditable service arising from the return to
3

active service.
4

(2) The accelerated pension benefit payment may not be
5

repaid to the fund, and the terminated creditable service
6

may not under any circumstances be reinstated.
7

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

(f) Upon receipt of a member's irrevocable election to
18
receive an accelerated pension benefit payment under this
19
Section, the fund shall submit a voucher to the Comptroller
20
for payment of the member's accelerated pension benefit
21
payment. The Comptroller shall transfer the amount of the
22
voucher from the Local Pension Obligation Acceleration Bond
23
Fund to the fund, and the fund shall transfer the amount into
24
the member's eligible retirement plan or qualified account.
25

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

SB3430
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LRB104 19288 RPS 32734 b
1

(h) No provision of this Section shall be interpreted in a
2
way that would cause the applicable fund to cease to be a
3
qualified plan under the Internal Revenue Code of 1986.

4

(40 ILCS 5/4-138.16 new)
5

Sec. 4-138.16.
Accelerated pension benefit payment for a
6
reduction in annual retirement pension increases.
7

(a) As used in this Section:
8

"Accelerated pension benefit payment" means a lump-sum
9
payment equal to 70% of the difference of the present value of
10
the automatic annual increases to a Tier 1 member's retirement
11
pension using the formula applicable to the Tier 1 member and
12
the present value of the automatic annual increases to the
13
Tier 1 member's retirement pension using the formula provided
14
under subsection (b-5).
15

"Eligible person" means a person who:
16

(1) is a Tier 1 member;
17

(2) has submitted an application for a retirement
18

pension under this Article;
19

(3) meets the age and service requirements for
20

receiving a retirement pension under this Article;
21

(4) has not received any retirement pension under this
22

Article;
23

(5) has not made the election under Section 4-138.15;
24

and
25

(6) is the employee of a unit of local government that

SB3430
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LRB104 19288 RPS 32734 b
1

receives payments out of the Local Government Distributive
2

Fund.
3

"Tier 1 member" means a person who first became a
4
firefighter before January 1, 2011.
5

(b) As soon as practical after the effective date of this
6
amendatory Act of the 104th General Assembly and until June
7
30, 2030, the fund shall implement an accelerated pension
8
benefit payment option for eligible persons. Upon the request
9
of an eligible person, the fund shall calculate, using
10
actuarial tables and other assumptions adopted by the Board,
11
an accelerated pension benefit payment amount and shall offer
12
that eligible person the opportunity to irrevocably elect to
13
have his or her automatic annual increases in retirement
14
pension calculated in accordance with the formula provided
15
under subsection (b-5) in exchange for the accelerated pension
16
benefit payment. The election under this subsection must be
17
made before the eligible person receives the first payment of
18
a retirement pension otherwise payable under this Article.
19

(b-5) Notwithstanding any other provision of law, the
20
retirement pension of a person who made the election under
21
subsection (b) shall be subject to annual increases on the
22
January 1 occurring either on or after the attainment of age 67
23
or the first anniversary of the pension start date, whichever
24
is later. Each annual increase shall be calculated at 1.5% of
25
the originally granted retirement pension.
26

(c) If a person who has received an accelerated pension

SB3430
- 17 -
LRB104 19288 RPS 32734 b
1
benefit payment returns to active service under this Article,
2
then:
3

(1) the calculation of any future automatic annual
4

increase in retirement pension shall be calculated in
5

accordance with the formula provided under subsection
6

(b-5); and
7

(2) the accelerated pension benefit payment may not be
8

repaid to the fund.
9

(d) 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 fund 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

(d-5) Upon receipt of a member's irrevocable election to
20
receive an accelerated pension benefit payment under this
21
Section, the fund 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 to the fund, and the fund shall transfer the amount
25
into a member's eligible retirement plan or qualified account.
26

(e) The Board shall adopt any rules, including emergency

SB3430
- 18 -
LRB104 19288 RPS 32734 b
1
rules, necessary to implement this Section.
2

(f) No provision of this Section shall be interpreted in a
3
way that would cause the applicable fund to cease to be a
4
qualified plan under the Internal Revenue Code of 1986.

5

(40 ILCS 5/5-218.5 new)
6

Sec. 5-218.5.
Accelerated pension benefit payment in lieu
7
of any pension benefit.
8

(a) As used in this Section:
9

"Eligible person" means a person who:
10

(1) has terminated service;
11

(2) has accrued sufficient service credit to be
12

eligible to receive a retirement annuity under this
13

Article;
14

(3) has not received any retirement annuity under this
15

Article; and
16

(4) has not made the election under Section 5-218.6.
17

"Pension benefit" means the benefits under this Article,
18
or Article 1 as it relates to those benefits, including any
19
anticipated annual increases, that an eligible person is
20
entitled to upon attainment of the applicable retirement age.
21
"Pension benefit" also includes applicable survivor's or
22
disability benefits.
23

(b) As soon as practical after the effective date of this
24
amendatory Act of the 104th General Assembly, the fund shall
25
calculate, using actuarial tables and other assumptions

SB3430
- 19 -
LRB104 19288 RPS 32734 b
1
adopted by the Board, the present value of pension benefits
2
for each eligible person who requests that information and
3
shall offer each eligible person the opportunity to
4
irrevocably elect to receive an amount determined by the fund
5
to be equal to 60% of the present value of his or her pension
6
benefits in lieu of receiving any pension benefit. The offer
7
shall specify the dollar amount that the eligible person will
8
receive if he or she so elects and shall expire when a
9
subsequent offer is made to an eligible person. An eligible
10
person is limited to one calculation and offer per calendar
11
year. The fund shall make a good faith effort to contact every
12
eligible person to notify him or her of the election.
13

Until June 30, 2030, an eligible person may irrevocably
14
elect to receive an accelerated pension benefit payment in the
15
amount that the fund offers under this subsection in lieu of
16
receiving any pension benefit.
17

(c) A person's creditable service under this Article shall
18
be terminated upon the person's receipt of an accelerated
19
pension benefit payment under this Section, and no other
20
benefit shall be paid under this Article based on the
21
terminated creditable service, including any retirement,
22
survivor, or other benefit.
23

(d) If a person who has received an accelerated pension
24
benefit payment under this Section returns to active service
25
under this Article, then:
26

(1) Any benefits under the fund earned as a result of

SB3430
- 20 -
LRB104 19288 RPS 32734 b
1

that return to active service shall be based solely on the
2

person's creditable service arising from the return to
3

active service.
4

(2) The accelerated pension benefit payment may not be
5

repaid to the fund, and the terminated creditable service
6

may not under any circumstances be reinstated.
7

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

(f) Upon receipt of a member's irrevocable election to
18
receive an accelerated pension benefit payment under this
19
Section, the fund shall submit a voucher to the Comptroller
20
for payment of the member's accelerated pension benefit
21
payment. The Comptroller shall transfer the amount of the
22
voucher from the Local Pension Obligation Acceleration Bond
23
Fund to the fund, and the fund shall transfer the amount into
24
the member's eligible retirement plan or qualified account.
25

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

SB3430
- 21 -
LRB104 19288 RPS 32734 b
1

(h) No provision of this Section shall be interpreted in a
2
way that would cause the applicable fund to cease to be a
3
qualified plan under the Internal Revenue Code of 1986.

4

(40 ILCS 5/5-218.6 new)
5

Sec. 5-218.6.
Accelerated pension benefit payment for a
6
reduction in annual retirement annuity increases.
7

(a) As used in this Section:
8

"Accelerated pension benefit payment" means a lump-sum
9
payment equal to 70% of the difference of the present value of
10
the automatic annual increases to a Tier 1 member's retirement
11
annuity and survivor's annuity using the formula applicable to
12
the Tier 1 member and the present value of the automatic annual
13
increases to the Tier 1 member's retirement annuity using the
14
formula provided under subsection (b-5).
15

"Eligible person" means a person who:
16

(1) is a Tier 1 member;
17

(2) has submitted an application for a retirement
18

annuity under this Article;
19

(3) meets the age and service requirements for
20

receiving a retirement annuity under this Article;
21

(4) has not received any retirement annuity under this
22

Article; and
23

(5) has not made the election under Section 5-218.5.
24

"Tier 1 member" means a person who first became a
25
policeman before January 1, 2011.

SB3430
- 22 -
LRB104 19288 RPS 32734 b
1

(b) As soon as practical after the effective date of this
2
amendatory Act of the 104th General Assembly and until June
3
30, 2030, the Fund shall implement an accelerated pension
4
benefit payment option for eligible persons. Upon the request
5
of an eligible person, the Fund shall calculate, using
6
actuarial tables and other assumptions adopted by the Board,
7
an accelerated pension benefit payment amount and shall offer
8
that eligible person the opportunity to irrevocably elect to
9
have his or her automatic annual increases in retirement
10
annuity calculated in accordance with the formula provided
11
under subsection (b-5) in exchange for the accelerated pension
12
benefit payment. The election under this subsection must be
13
made before the eligible person receives the first payment of
14
a retirement annuity otherwise 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

(c) If a person who has received an accelerated pension
23
benefit payment returns to active service under this Article,
24
then:
25

(1) the calculation of any future automatic annual
26

increase in retirement annuity shall be calculated in

SB3430
- 23 -
LRB104 19288 RPS 32734 b
1

accordance with the formula provided under subsection
2

(b-5); and
3

(2) the accelerated pension benefit payment may not be
4

repaid to the Fund.
5

(d) As a condition of receiving an accelerated pension
6
benefit payment, the accelerated pension benefit payment must
7
be transferred into a tax qualified retirement plan or
8
account. The accelerated pension benefit payment under this
9
Section may be subject to withholding or payment of applicable
10
taxes, but to the extent permitted by federal law, a person who
11
receives an accelerated pension benefit payment under this
12
Section must direct the Fund to pay all of that payment as a
13
rollover into another retirement plan or account qualified
14
under the Internal Revenue Code of 1986, as amended.
15

(d-5) Upon receipt of a member's irrevocable election to
16
receive an accelerated pension benefit payment under this
17
Section, the Fund shall submit a voucher to the Comptroller
18
for payment of the member's accelerated pension benefit
19
payment. The Comptroller shall transfer the amount of the
20
voucher to the Fund, and the Fund shall transfer the amount
21
into a member's eligible retirement plan or qualified account.
22

(e) The Board shall adopt any rules, including emergency
23
rules, necessary to implement this Section.
24

(f) No provision of this Section shall be interpreted in a
25
way that would cause the applicable Fund to cease to be a
26
qualified plan under the Internal Revenue Code of 1986.

SB3430
- 24 -
LRB104 19288 RPS 32734 b
1

(40 ILCS 5/6-213.5 new)
2

Sec. 6-213.5.
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 6-213.6.
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 the effective date of this
20
amendatory Act of the 104th General Assembly, the Fund shall
21
calculate, using actuarial tables and other assumptions
22
adopted by the Board, the present value of pension benefits
23
for each eligible person who requests that information and
24
shall offer each eligible person the opportunity to
25
irrevocably elect to receive an amount determined by the Fund

SB3430
- 25 -
LRB104 19288 RPS 32734 b
1
to be equal to 60% of the present value of his or her pension
2
benefits in lieu of receiving any pension benefit. The offer
3
shall specify the dollar amount that the eligible person will
4
receive if he or she so elects and shall expire when a
5
subsequent offer is made to an eligible person. An eligible
6
person is limited to one calculation and offer per calendar
7
year. The Fund shall make a good faith effort to contact every
8
eligible person to notify him or her of the election.
9

Until June 30, 2030, an eligible person may irrevocably
10
elect to receive an accelerated pension benefit payment in the
11
amount that the Fund offers under this subsection in lieu of
12
receiving any pension benefit.
13

(c) A person's creditable service under this Article shall
14
be terminated upon the person's receipt of an accelerated
15
pension benefit payment under this Section, and no other
16
benefit shall be paid under this Article based on the
17
terminated creditable service, including any retirement,
18
survivor, or other benefit.
19

(d) If a person who has received an accelerated pension
20
benefit payment under this Section returns to active service
21
under this Article, then:
22

(1) Any benefits under the Fund earned as a result of
23

that return to active service shall be based solely on the
24

person's creditable service arising from the return to
25

active service.
26

(2) The accelerated pension benefit payment may not be

SB3430
- 26 -
LRB104 19288 RPS 32734 b
1

repaid to the Fund, and the terminated creditable service
2

may not under any circumstances be reinstated.
3

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

(f) Upon receipt of a member's irrevocable election to
14
receive an accelerated pension benefit payment under this
15
Section, the Fund shall submit a voucher to the Comptroller
16
for payment of the member's accelerated pension benefit
17
payment. The Comptroller shall transfer the amount of the
18
voucher from the Local Pension Obligation Acceleration Bond
19
Fund to the Fund, and the Fund shall transfer the amount into
20
the member's eligible retirement plan or qualified 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 Fund to cease to be a
25
qualified plan under the Internal Revenue Code of 1986.

SB3430
- 27 -
LRB104 19288 RPS 32734 b
1

(40 ILCS 5/6-213.6 new)
2

Sec. 6-213.6.
Accelerated pension benefit payment for a
3
reduction in annual retirement annuity increases.
4

(a) As used in this Section:
5

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

(1) is a Tier 1 member;
14

(2) has submitted an application for a retirement
15

annuity under this Article;
16

(3) meets the age and service requirements for
17

receiving a retirement annuity under this Article;
18

(4) has not received any retirement annuity under this
19

Article; and
20

(5) has not made the election under Section 6-213.5.
21

"Tier 1 member" means a person who first became a fireman
22
under this Article before January 1, 2011.
23

(b) As soon as practical after the effective date of this
24
amendatory Act of the 104th General Assembly and until June
25
30, 2030, the Fund shall implement an accelerated pension
26
benefit payment option for eligible persons. Upon the request

SB3430
- 28 -
LRB104 19288 RPS 32734 b
1
of an eligible person, the Fund shall calculate, using
2
actuarial tables and other assumptions adopted by the Board,
3
an accelerated pension benefit payment amount and shall offer
4
that eligible person the opportunity to irrevocably elect to
5
have his or her automatic annual increases in retirement
6
annuity calculated in accordance with the formula provided
7
under subsection (b-5) in exchange for the accelerated pension
8
benefit payment. The election under this subsection must be
9
made before the eligible person receives the first payment of
10
a retirement annuity otherwise payable under this Article.
11

(b-5) Notwithstanding any other provision of law, the
12
retirement annuity of a person who made the election under
13
subsection (b) shall be subject to annual increases on the
14
January 1 occurring either on or after the attainment of age 67
15
or the first anniversary of the annuity start date, whichever
16
is later. Each annual increase shall be calculated at 1.5% of
17
the originally granted retirement annuity.
18

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

(1) the calculation of any future automatic annual
22

increase in retirement annuity shall be calculated in
23

accordance with the formula provided under subsection
24

(b-5); and
25

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

repaid to the Fund.

SB3430
- 29 -
LRB104 19288 RPS 32734 b
1

(d) As a condition of receiving an accelerated pension
2
benefit payment, the accelerated pension benefit payment must
3
be transferred into a tax qualified retirement plan or
4
account. The accelerated pension benefit payment under this
5
Section may be subject to withholding or payment of applicable
6
taxes, but to the extent permitted by federal law, a person who
7
receives an accelerated pension benefit payment under this
8
Section must direct the Fund to pay all of that payment as a
9
rollover into another retirement plan or account qualified
10
under the Internal Revenue Code of 1986, as amended.
11

(d-5) Upon receipt of a member's irrevocable election to
12
receive an accelerated pension benefit payment under this
13
Section, the Fund shall submit a voucher to the Comptroller
14
for payment of the member's accelerated pension benefit
15
payment. The Comptroller shall transfer the amount of the
16
voucher to the Fund, and the Fund shall transfer the amount
17
into a member's eligible retirement plan or qualified account.
18

(e) The Board shall adopt any rules, including emergency
19
rules, necessary to implement this Section.
20

(f) No provision of this Section shall be interpreted in a
21
way that would cause the applicable Fund to cease to be a
22
qualified plan under the Internal Revenue Code of 1986.

23

(40 ILCS 5/7-217.5 new)
24

Sec. 7-217.5.
Accelerated pension benefit payment in lieu
25
of any pension benefit.

SB3430
- 30 -
LRB104 19288 RPS 32734 b
1

(a) As used in this Section:
2

"Eligible person" means a person who:
3

(1) has terminated service;
4

(2) has accrued sufficient service credit to be
5

eligible to receive a retirement annuity under this
6

Article;
7

(3) has not received any retirement annuity under this
8

Article; and
9

(4) has not made the election under Section 7-217.6.
10

"Pension benefit" means the benefits under this Article,
11
or Article 1 as it relates to those benefits, including any
12
anticipated annual increases, that an eligible person is
13
entitled to upon attainment of the applicable retirement age.
14
"Pension benefit" also includes applicable survivor's or
15
disability benefits.
16

(b) As soon as practical after the effective date of this
17
amendatory Act of the 104th General Assembly, the Fund shall
18
calculate, using actuarial tables and other assumptions
19
adopted by the Board, the present value of pension benefits
20
for each eligible person who requests that information and
21
shall offer each eligible person the opportunity to
22
irrevocably elect to receive an amount determined by the Fund
23
to be equal to 60% of the present value of his or her pension
24
benefits in lieu of receiving any pension benefit. The offer
25
shall specify the dollar amount that the eligible person will
26
receive if he or she so elects and shall expire when a

SB3430
- 31 -
LRB104 19288 RPS 32734 b
1
subsequent offer is made to an eligible person. An eligible
2
person is limited to one calculation and offer per calendar
3
year. The Fund shall make a good faith effort to contact every
4
eligible person to notify him or her of the election.
5

Until June 30, 2030, an eligible person may irrevocably
6
elect to receive an accelerated pension benefit payment in the
7
amount that the Fund offers under this subsection in lieu of
8
receiving any pension benefit. A person who elects to receive
9
an accelerated pension benefit payment under this Section may
10
not elect to proceed under the Retirement Systems Reciprocal
11
Act with respect to service under this Article.
12

(c) A person's creditable service under this Article shall
13
be terminated upon the person's receipt of an accelerated
14
pension benefit payment under this Section, and no other
15
benefit shall be paid under this Article based on the
16
terminated creditable service, including any retirement,
17
survivor, or other benefit.
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 Fund earned as a result of
22

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

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 Fund, and the terminated creditable service

SB3430
- 32 -
LRB104 19288 RPS 32734 b
1

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 Fund 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 Fund 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 Local Pension Obligation Acceleration Bond
18
Fund to the Fund, and the Fund shall transfer the amount into
19
the member's eligible retirement plan or qualified account.
20

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

(h) No provision of this Section shall be interpreted in a
23
way that would cause the applicable Fund to cease to be a
24
qualified plan under the Internal Revenue Code of 1986.

25

(40 ILCS 5/7-217.6 new)

SB3430
- 33 -
LRB104 19288 RPS 32734 b
1

Sec. 7-217.6.
Accelerated pension benefit payment for a
2
reduction in annual retirement annuity and survivor's annuity
3
increases.
4

(a) As used in this Section:
5

"Accelerated pension benefit payment" means a lump-sum
6
payment equal to 70% of the difference of the present value of
7
the automatic annual increases to a Tier 1 regular employee's
8
retirement annuity and survivor's annuity using the formula
9
applicable to the Tier 1 regular employee and the present
10
value of the automatic annual increases to the Tier 1 regular
11
employee's retirement annuity using the formula provided under
12
subsection (b-5) and survivor's annuity using the formula
13
provided under subsection (b-6). "Eligible person" means a
14
person who:
15

(1) is a Tier 1 regular employee;
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 7-217.5.
23

(b) As soon as practical after the effective date of this
24
amendatory Act of the 104th General Assembly and until June
25
30, 2030, the Fund shall implement an accelerated pension
26
benefit payment option for eligible persons. Upon the request

SB3430
- 34 -
LRB104 19288 RPS 32734 b
1
of an eligible person, the Fund shall calculate, using
2
actuarial tables and other assumptions adopted by the Board,
3
an accelerated pension benefit payment amount and shall offer
4
that eligible person the opportunity to irrevocably elect to
5
have his or her automatic annual increases in retirement
6
annuity calculated in accordance with the formula provided
7
under subsection (b-5) and any increases in survivor's annuity
8
payable to his or her survivor's annuity beneficiary
9
calculated in accordance with the formula provided under
10
subsection (b-6) in exchange for the accelerated pension
11
benefit payment. The election under this subsection must be
12
made before the eligible person receives the first payment of
13
a retirement annuity otherwise payable under this Article.
14

(b-5) Notwithstanding any other provision of law, the
15
retirement annuity of a person who made the election under
16
subsection (b) shall be subject to annual increases on the
17
January 1 occurring either on or after the attainment of age 67
18
or the first anniversary of the annuity start date, whichever
19
is later. Each annual increase shall be calculated at 1.5% of
20
the originally granted retirement annuity.
21

(b-6) Notwithstanding any other provision of law, a
22
survivor's annuity payable to a survivor's annuity beneficiary
23
of a person who made the election under subsection (b) shall be
24
subject to annual increases on the January 1 occurring on or
25
after the first anniversary of the commencement of the
26
annuity. Each annual increase shall be calculated at 1.5% of

SB3430
- 35 -
LRB104 19288 RPS 32734 b
1
the originally granted survivor's annuity.
2

(c) If a person who has received an accelerated pension
3
benefit payment returns to active service under this Article,
4
then:
5

(1) the calculation of any future automatic annual
6

increase in retirement annuity shall be calculated in
7

accordance with the formula provided under subsection
8

(b-5); and
9

(2) the accelerated pension benefit payment may not be
10

repaid to the Fund.
11

(d) As a condition of receiving an accelerated pension
12
benefit payment, the accelerated pension benefit payment must
13
be transferred into a tax qualified retirement plan or
14
account. The accelerated pension benefit payment under this
15
Section may be subject to withholding or payment of applicable
16
taxes, but to the extent permitted by federal law, a person who
17
receives an accelerated pension benefit payment under this
18
Section must direct the Fund to pay all of that payment as a
19
rollover into another retirement plan or account qualified
20
under the Internal Revenue Code of 1986, as amended.
21

(d-5) Upon receipt of a member's irrevocable election to
22
receive an accelerated pension benefit payment under this
23
Section, the Fund shall submit a voucher to the Comptroller
24
for payment of the member's accelerated pension benefit
25
payment. The Comptroller shall transfer the amount of the
26
voucher to the Fund, and the Fund shall transfer the amount

SB3430
- 36 -
LRB104 19288 RPS 32734 b
1
into a member's eligible retirement plan or qualified account.
2

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

(f) No provision of this Section shall be interpreted in a
5
way that would cause the applicable Fund to cease to be a
6
qualified plan under the Internal Revenue Code of 1986.

7

(40 ILCS 5/8-244.5 new)
8

Sec. 8-244.5.
Accelerated pension benefit payment in lieu
9
of any pension benefit.
10

(a) As used in this Section:
11

"Eligible person" means a person who:
12

(1) has terminated service;
13

(2) has accrued sufficient service credit to be
14

eligible to receive a retirement annuity under this
15

Article;
16

(3) has not received any retirement annuity under this
17

Article; and
18

(4) has not made the election under Section 8-244.6.
19

"Pension benefit" means the benefits under this Article,
20
or Article 1 as it relates to those benefits, including any
21
anticipated annual increases, that an eligible person is
22
entitled to upon attainment of the applicable retirement age.
23
"Pension benefit" also includes applicable survivor's or
24
disability benefits.
25

(b) As soon as practical after the effective date of this

SB3430
- 37 -
LRB104 19288 RPS 32734 b
1
amendatory Act of the 104th General Assembly, the Fund shall
2
calculate, using actuarial tables and other assumptions
3
adopted by the Board, the present value of pension benefits
4
for each eligible person who requests that information and
5
shall offer each eligible person the opportunity to
6
irrevocably elect to receive an amount determined by the Fund
7
to be equal to 60% of the present value of his or her pension
8
benefits in lieu of receiving any pension benefit. The offer
9
shall specify the dollar amount that the eligible person will
10
receive if he or she so elects and shall expire when a
11
subsequent offer is made to an eligible person. An eligible
12
person is limited to one calculation and offer per calendar
13
year. The Fund shall make a good faith effort to contact every
14
eligible person to notify him or her of the election.
15

Until June 30, 2030, an eligible person may irrevocably
16
elect to receive an accelerated pension benefit payment in the
17
amount that the Fund offers under this subsection in lieu of
18
receiving any pension benefit. A person who elects to receive
19
an accelerated pension benefit payment under this Section may
20
not elect to proceed under the Retirement Systems Reciprocal
21
Act with respect to service under this Article.
22

(c) A person's creditable service under this Article shall
23
be terminated upon the person's receipt of an accelerated
24
pension benefit payment under this Section, and no other
25
benefit shall be paid under this Article based on the
26
terminated creditable service, including any retirement,

SB3430
- 38 -
LRB104 19288 RPS 32734 b
1
survivor, or other benefit.
2

(d) If a person who has received an accelerated pension
3
benefit payment under this Section returns to active service
4
under this Article, then:
5

(1) Any benefits under the Fund earned as a result of
6

that return to active service shall be based solely on the
7

person's creditable service arising from the return to
8

active service.
9

(2) The accelerated pension benefit payment may not be
10

repaid to the Fund, and the terminated creditable service
11

may not under any circumstances be reinstated.
12

(e) 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 Fund 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

(f) Upon receipt of a member's irrevocable election to
23
receive an accelerated pension benefit payment under this
24
Section, the Fund 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

SB3430
- 39 -
LRB104 19288 RPS 32734 b
1
voucher from the Local Pension Obligation Acceleration Bond
2
Fund to the Fund, and the Fund shall transfer the amount into
3
the member's eligible retirement plan or qualified account.
4

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

(h) No provision of this Section shall be interpreted in a
7
way that would cause the applicable Fund to cease to be a
8
qualified plan under the Internal Revenue Code of 1986.

9

(40 ILCS 5/8-244.6 new)
10

Sec. 8-244.6.
Accelerated pension benefit payment for a
11
reduction in annual retirement annuity.
12

(a) As used in this Section:
13

"Accelerated pension benefit payment" means a lump-sum
14
payment equal to 70% of the difference of the present value of
15
the automatic annual increases to a Tier 1 member's retirement
16
annuity using the formula applicable to the Tier 1 member and
17
the present value of the automatic annual increases to the
18
Tier 1 member's retirement annuity using the formula provided
19
under subsection (b-5).
20

"Eligible person" means a person who:
21

(1) is a Tier 1 member;
22

(2) has submitted an application for a retirement
23

annuity under this Article;
24

(3) meets the age and service requirements for
25

receiving a retirement annuity under this Article;

SB3430
- 40 -
LRB104 19288 RPS 32734 b
1

(4) has not received any retirement annuity under this
2

Article; and
3

(5) has not made the election under Section 8-244.5.
4

"Tier 1 member" means an employee who first became a
5
participant under this Article or any reciprocal retirement
6
system or pension fund established under this Code before
7
January 1, 2011.
8

(b) As soon as practical after the effective date of this
9
amendatory Act of the 104th General Assembly and until June
10
30, 2030, the Fund shall implement an accelerated pension
11
benefit payment option for eligible persons. Upon the request
12
of an eligible person, the Fund shall calculate, using
13
actuarial tables and other assumptions adopted by the Board,
14
an accelerated pension benefit payment amount and shall offer
15
that eligible person the opportunity to irrevocably elect to
16
have his or her automatic annual increases in retirement
17
annuity calculated in accordance with the formula provided
18
under subsection (b-5) in exchange for the accelerated pension
19
benefit payment. The election under this subsection must be
20
made before the eligible person receives the first payment of
21
a retirement annuity otherwise payable under this Article.
22

(b-5) Notwithstanding any other provision of law, the
23
retirement annuity of a person who made the election under
24
subsection (b) shall be subject to annual increases on the
25
January 1 occurring either on or after the attainment of age 67
26
or the first anniversary of the annuity start date, whichever

SB3430
- 41 -
LRB104 19288 RPS 32734 b
1
is later. Each annual increase shall be calculated at 1.5% of
2
the originally granted retirement 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 Fund.
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 Fund 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 Fund 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

SB3430
- 42 -
LRB104 19288 RPS 32734 b
1
voucher to the Fund, and the Fund shall transfer the amount
2
into a member's eligible retirement plan or qualified account.
3

(e) The Board shall adopt any rules, including emergency
4
rules, necessary to implement this Section.
5

(f) No provision of this Section shall be interpreted in a
6
way that would cause the applicable Fund to cease to be a
7
qualified plan under the Internal Revenue Code of 1986.

8

(40 ILCS 5/11-223.5 new)
9

Sec. 11-223.5.
Accelerated pension benefit payment in lieu
10
of any pension benefit.
11

(a) As used in this Section:
12

"Eligible person" means a person who:
13

(1) has terminated service;
14

(2) has accrued sufficient service credit to be
15

eligible to receive a retirement annuity under this
16

Article;
17

(3) has not received any retirement annuity under this
18

Article; and
19

(4) has not made the election under Section 11-223.6.
20

"Pension benefit" means the benefits under this Article,
21
or Article 1 as it relates to those benefits, including any
22
anticipated annual increases, that an eligible person is
23
entitled to upon attainment of the applicable retirement age.
24
"Pension benefit" also includes applicable survivor's,
25
widow's, or disability benefits.

SB3430
- 43 -
LRB104 19288 RPS 32734 b
1

(b) As soon as practical after the effective date of this
2
amendatory Act of the 104th General Assembly, the Fund shall
3
calculate, using actuarial tables and other assumptions
4
adopted by the Board, the present value of pension benefits
5
for each eligible person who requests that information and
6
shall offer each eligible person the opportunity to
7
irrevocably elect to receive an amount determined by the Fund
8
to be equal to 60% of the present value of his or her pension
9
benefits in lieu of receiving any pension benefit. The offer
10
shall specify the dollar amount that the eligible person will
11
receive if he or she so elects and shall expire when a
12
subsequent offer is made to an eligible person. An eligible
13
person is limited to one calculation and offer per calendar
14
year. The Fund shall make a good faith effort to contact every
15
eligible person to notify him or her of the election.
16

Until June 30, 2030, an eligible person may irrevocably
17
elect to receive an accelerated pension benefit payment in the
18
amount that the Fund offers under this subsection in lieu of
19
receiving any pension benefit. A person who elects to receive
20
an accelerated pension benefit payment under this Section may
21
not elect to proceed under the Retirement Systems Reciprocal
22
Act with respect to service under this Article.
23

(c) A person's creditable service under this Article shall
24
be terminated upon the person's receipt of an accelerated
25
pension benefit payment under this Section, and no other
26
benefit shall be paid under this Article based on the

SB3430
- 44 -
LRB104 19288 RPS 32734 b
1
terminated creditable service, including any retirement,
2
survivor, widow, or other benefit.
3

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

(1) Any benefits under the Fund earned as a result of
7

that return to active service shall be based solely on the
8

person's creditable service arising from the return to
9

active service.
10

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

repaid to the Fund, and the terminated creditable service
12

may not under any circumstances be reinstated.
13

(e) As a condition of receiving an accelerated pension
14
benefit payment, the accelerated pension benefit payment must
15
be transferred into a tax qualified retirement plan or
16
account. The accelerated pension benefit payment under this
17
Section may be subject to withholding or payment of applicable
18
taxes, but to the extent permitted by federal law, a person who
19
receives an accelerated pension benefit payment under this
20
Section must direct the Fund to pay all of that payment as a
21
rollover into another retirement plan or account qualified
22
under the Internal Revenue Code of 1986, as amended.
23

(f) Upon receipt of a member's irrevocable election to
24
receive an accelerated pension benefit payment under this
25
Section, the Fund shall submit a voucher to the Comptroller
26
for payment of the member's accelerated pension benefit

SB3430
- 45 -
LRB104 19288 RPS 32734 b
1
payment. The Comptroller shall transfer the amount of the
2
voucher from the Local Pension Obligation Acceleration Bond
3
Fund to the Fund, and the Fund shall transfer the amount into
4
the member's eligible retirement plan or qualified account.
5

(g) The Board shall adopt any rules, including emergency
6
rules, necessary to implement this Section.
7

(h) No provision of this Section shall be interpreted in a
8
way that would cause the applicable Fund to cease to be a
9
qualified plan under the Internal Revenue Code of 1986.

10

(40 ILCS 5/11-223.6 new)
11

Sec. 11-223.6.
Accelerated pension benefit payment for a
12
reduction in annual retirement annuity and widow'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 widow'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).
22

"Eligible person" means a person who:
23

(1) is a Tier 1 member;
24

(2) has submitted an application for a retirement
25

annuity under this Article;

SB3430
- 46 -
LRB104 19288 RPS 32734 b
1

(3) meets the age and service requirements for
2

receiving a retirement annuity under this Article;
3

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

Article; and
5

(5) has not made the election under Section 11-223.5.
6

"Tier 1 member" means a person who first became a
7
participant under this Article or any reciprocal retirement
8
system or pension fund established under this Code before
9
January 1, 2011.
10

(b) As soon as practical after the effective date of this
11
amendatory Act of the 104th General Assembly and until June
12
30, 2030, the Fund shall implement an accelerated pension
13
benefit payment option for eligible persons. Upon the request
14
of an eligible person, the Fund shall calculate, using
15
actuarial tables and other assumptions adopted by the Board,
16
an accelerated pension benefit payment amount and shall offer
17
that eligible person the opportunity to irrevocably elect to
18
have his or her automatic annual increases in retirement
19
annuity calculated in accordance with the formula provided
20
under subsection (b-5) in exchange for the accelerated pension
21
benefit payment. The election under this subsection must be
22
made before the eligible person receives the first payment of
23
a retirement annuity otherwise 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

SB3430
- 47 -
LRB104 19288 RPS 32734 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

(c) If a person who has received an accelerated pension
6
benefit payment returns to active service under this Article,
7
then:
8

(1) the calculation of any future automatic annual
9

increase in retirement annuity shall be calculated in
10

accordance with the formula provided under subsection
11

(b-5); and
12

(2) the accelerated pension benefit payment may not be
13

repaid to the Fund.
14

(d) As a condition of receiving an accelerated pension
15
benefit payment, the accelerated pension benefit payment must
16
be transferred into a tax qualified retirement plan or
17
account. The accelerated pension benefit payment under this
18
Section may be subject to withholding or payment of applicable
19
taxes, but to the extent permitted by federal law, a person who
20
receives an accelerated pension benefit payment under this
21
Section must direct the Fund to pay all of that payment as a
22
rollover into another retirement plan or account qualified
23
under the Internal Revenue Code of 1986, as amended.
24

(d-5) Upon receipt of a member's irrevocable election to
25
receive an accelerated pension benefit payment under this
26
Section, the Fund shall submit a voucher to the Comptroller

SB3430
- 48 -
LRB104 19288 RPS 32734 b
1
for payment of the member's accelerated pension benefit
2
payment. The Comptroller shall transfer the amount of the
3
voucher to the Fund, and the Fund shall transfer the amount
4
into a member's eligible retirement plan or qualified account.
5

(e) The Board shall adopt any rules, including emergency
6
rules, necessary to implement this Section.
7

(f) No provision of this Section shall be interpreted in a
8
way that would cause the applicable Fund to cease to be a
9
qualified plan under the Internal Revenue Code of 1986.

10

Section 90.
The State Mandates Act is amended by adding
11
Section 8.50 as follows:

12

(30 ILCS 805/8.50 new)
13

Sec. 8.50.
Exempt mandate.
Notwithstanding Sections 6 and
14
8 of this Act, no reimbursement by the State is required for
15
the implementation of any mandate created by this amendatory
16
Act of the 104th General Assembly.

17

Section 99.
Effective date.
This Act takes effect upon
18
becoming law.

SB3430
- 49 -
LRB104 19288 RPS 32734 b
1

INDEX

2

Statutes amended in order of appearance

3

30 ILCS 105/5.1038 new
4

30 ILCS 330/2
from Ch. 127, par. 652
5

30 ILCS 330/2.5
6

30 ILCS 330/7.8 new
7

40 ILCS 5/3-144.3 new
8

40 ILCS 5/3-144.4 new
9

40 ILCS 5/4-138.15 new
10

40 ILCS 5/4-138.16 new
11

40 ILCS 5/5-218.5 new
12

40 ILCS 5/5-218.6 new
13

40 ILCS 5/6-213.5 new
14

40 ILCS 5/6-213.6 new
15

40 ILCS 5/7-217.5 new
16

40 ILCS 5/7-217.6 new
17

40 ILCS 5/8-244.5 new
18

40 ILCS 5/8-244.6 new
19

40 ILCS 5/11-223.5 new
20

40 ILCS 5/11-223.6 new
21

30 ILCS 805/8.50 new

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