Illinois-2025-HB2484-Introduced

104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB2484

Introduced , by Rep. Stephanie A. Kifowit

SYNOPSIS AS INTRODUCED:

`40 ILCS 5/3-109.1`	`from Ch. 108 1/2, par. 3-109.1`
`40 ILCS 5/3-109.4`
`40 ILCS 5/3-124.1`	`from Ch. 108 1/2, par. 3-124.1`
`40 ILCS 5/7-109`	`from Ch. 108 1/2, par. 7-109`

Amends the Downstate Police and Illinois Municipal Retirement Fund (IMRF) Articles of the Illinois Pension Code. Removes language providing that a person may not elect to participate in IMRF with respect to his or her employment as a chief of police of a participating municipality, unless that person became a participating employee in IMRF before January 1, 2019. Makes conforming changes. In the Downstate Police Article, provides that, on and after the effective date of the amendatory Act, a municipality is not required to establish a defined contribution plan. Provides that a municipality is required to maintain a defined contribution plan for persons who began participating in the defined contribution plan before the effective date of the amendatory Act. In provisions authorizing certain police officers to elect to participate in the defined contribution plan, restricts participation to police officers who first became police officers before the effective date of the amendatory Act and to municipalities that established a defined contribution plan before the effective date of the amendatory Act. Amends the State Mandates Act to require implementation without reimbursement.

LRB104 10783 RPS 20863 b

STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY

A BILL FOR

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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 Illinois Pension Code is amended by

5 changing Sections 3-109.1, 3-109.4, 3-124.1, and 7-109 and by

6 adding Section 3-109.4 as follows:

7 (40 ILCS 5/3-109.1) (from Ch. 108 1/2, par. 3-109.1)

8 Sec. 3-109.1. Chief of police.

9 (a) Beginning ~~Except as provided in subsection (a-5),~~

10 ~~beginning~~ January 1, 1990, any person who is employed as the

11 chief of police of a "participating municipality" as defined

12 in Section 7-106 of this Code, may elect to participate in the

13 Illinois Municipal Retirement Fund rather than in a fund

14 created under this Article 3. Except as provided in subsection

15 (b), this election shall be irrevocable, and shall be filed in

16 writing with the Board of the Illinois Municipal Retirement

17 Fund.

18 ~~(a-5) On or after January 1, 2019, a person may not elect~~

19 ~~to participate in the Illinois Municipal Retirement Fund with~~

20 ~~respect to his or her employment as the chief of police of a~~

21 ~~participating municipality, unless that person became a~~

22 ~~participating employee in the Illinois Municipal Retirement~~

23 ~~Fund before January 1, 2019.~~

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1 (b) Until January 1, 1999, a chief of police who has

2 elected under this Section to participate in IMRF rather than

3 a fund created under this Article may elect to rescind that

4 election and transfer his or her participation to the police

5 pension fund established under this Article by the employing

6 municipality. The chief must notify the boards of trustees of

7 both funds in writing of his or her decision to rescind the

8 election and transfer participation. A chief of police who

9 transfers participation under this subsection (b) shall not be

10 deemed ineligible to participate in the police pension fund by

11 reason of having failed to apply within the 3-month period

12 specified in Section 3-106.

13 (Source: P.A. 100-281, eff. 8-24-17.)

14 (40 ILCS 5/3-109.4)

15 Sec. 3-109.4. Defined contribution plan for certain police

16 officers.

17 (a) Except as otherwise provided in this Section, each

18 ~~Each~~ municipality shall establish a defined contribution plan

19 that aggregates police officer and employer contributions in

20 individual accounts used for retirement. The defined

21 contribution plan, including both police officer and employer

22 contributions, established by the municipality must, at a

23 minimum: meet the safe harbor provisions of the Internal

24 Revenue Code of 1986, as amended; be a qualified plan under the

25 Internal Revenue Code of 1986, as amended; and comply with all

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1 other applicable laws, rules, and regulations. Contributions

2 shall vest immediately upon deposit in the police officer's

3 account.

4 On and after the effective date of this amendatory Act of

5 the 104th General Assembly, a municipality is not required to

6 establish a defined contribution plan under this Section.

7 However, a municipality is required to maintain a defined

8 contribution plan for persons who began participating in the

9 defined contribution plan before the effective date of this

10 amendatory Act of the 104th General Assembly.

11 A police officer who participates in the defined

12 contribution plan under this Section may not earn creditable

13 service or otherwise participate in the defined benefit plan

14 offered by his or her employing municipality, except as an

15 annuitant in another fund or as a survivor, while he or she is

16 a participant in the defined contribution plan. The defined

17 contribution plan under this Section shall not be construed to

18 be a pension, annuity, or other defined benefit under this

19 Code.

20 (b) If a police officer who first became a police officer

21 under this Article before the effective date of this

22 amendatory Act of the 104th General Assembly and has more than

23 10 years of creditable service in a fund enters active service

24 with a different municipality, he or she may elect to

25 participate in the defined contribution plan under this

26 Section in lieu of the defined benefit plan if the

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1 municipality has such a defined contribution plan.

2 A police officer who has elected under this subsection to

3 participate in the defined contribution plan may, in writing,

4 rescind that election in accordance with the rules of the

5 board. Any employer contributions, and the earnings thereon,

6 shall remain vested in the police officer's account. A police

7 officer who rescinds the election may begin participating in

8 the defined benefit plan on the first day of the month

9 following the rescission.

10 (c) As used in this Section, "defined benefit plan" means

11 the retirement plan available to police officers under this

12 Article who do not participate in the defined contribution

13 plan under this Section.

14 (Source: P.A. 100-281, eff. 8-24-17.)

15 (40 ILCS 5/3-124.1) (from Ch. 108 1/2, par. 3-124.1)

16 Sec. 3-124.1. Re-entry into active service. (a) If a

17 police officer who is receiving pension payments other than as

18 provided in Section 3-109.3 re-enters active service, pension

19 payment shall be suspended while he or she is in service. When

20 he or she again retires, pension payments shall be resumed. If

21 the police officer remains in service after re-entry for a

22 period of less than 5 years, the pension shall be the same as

23 upon first retirement. If the officer's service after re-entry

24 is at least 5 years and the officer makes the required

25 contributions during the period of re-entry, his or her

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1 pension shall be recomputed by taking into account the

2 additional period of service and salary.

3 (b) If a police officer who first becomes a member on or

4 after January 1, 2019 but before the effective date of this

5 amendatory Act of the 104th General Assembly is receiving

6 pension payments (other than as provided in Section 3-109.3)

7 and re-enters active service with any municipality that has

8 established a pension fund under this Article, that police

9 officer may continue to receive pension payments while he or

10 she is in active service, but shall only participate in a

11 defined contribution plan established by the municipality

12 pursuant to Section 3-109.4, if the municipality has

13 established such a defined contribution plan, and may not

14 establish creditable service in the pension fund established

15 by that municipality or have his or her pension recomputed.

16 (Source: P.A. 100-281, eff. 8-24-17.)

17 (40 ILCS 5/7-109) (from Ch. 108 1/2, par. 7-109)

18 Sec. 7-109. Employee.

19 (1) "Employee" means any person who:

20 (a) 1. Receives earnings as payment for the

21 performance of personal services or official duties out of

22 the general fund of a municipality, or out of any special

23 fund or funds controlled by a municipality, or by an

24 instrumentality thereof, or a participating

25 instrumentality, including, in counties, the fees or

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1 earnings of any county fee office; and

2 2. Under the usual common law rules applicable in

3 determining the employer-employee relationship, has the

4 status of an employee with a municipality, or any

5 instrumentality thereof, or a participating

6 instrumentality, including alderpersons, county

7 supervisors and other persons (excepting those employed as

8 independent contractors) who are paid compensation, fees,

9 allowances or other emolument for official duties, and, in

10 counties, the several county fee offices.

11 (b) Serves as a township treasurer appointed under the

12 School Code, as heretofore or hereafter amended, and who

13 receives for such services regular compensation as

14 distinguished from per diem compensation, and any regular

15 employee in the office of any township treasurer whether

16 or not his earnings are paid from the income of the

17 permanent township fund or from funds subject to

18 distribution to the several school districts and parts of

19 school districts as provided in the School Code, or from

20 both such sources; or is the chief executive officer,

21 chief educational officer, chief fiscal officer, or other

22 employee of a Financial Oversight Panel established

23 pursuant to Article 1H of the School Code, other than a

24 superintendent or certified school business official,

25 except that such person shall not be treated as an

26 employee under this Section if that person has negotiated

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1 with the Financial Oversight Panel, in conjunction with

2 the school district, a contractual agreement for exclusion

3 from this Section.

4 (c) Holds an elective office in a municipality,

5 instrumentality thereof or participating instrumentality.

6 (2) "Employee" does not include persons who:

7 (a) Are eligible for inclusion under any of the

8 following laws:

9 1. "An Act in relation to an Illinois State

10 Teachers' Pension and Retirement Fund", approved May

11 27, 1915, as amended;

12 2. Articles 15 and 16 of this Code.

13 However, such persons shall be included as employees

14 to the extent of earnings that are not eligible for

15 inclusion under the foregoing laws for services not of an

16 instructional nature of any kind.

17 However, any member of the armed forces who is

18 employed as a teacher of subjects in the Reserve Officers

19 Training Corps of any school and who is not certified

20 under the law governing the certification of teachers

21 shall be included as an employee.

22 (b) Are designated by the governing body of a

23 municipality in which a pension fund is required by law to

24 be established for policemen or firemen, respectively, as

25 performing police or fire protection duties, except that

26 when such persons are the heads of the police or fire

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1 department and are not eligible to be included within any

2 such pension fund, they shall be included within this

3 Article; provided, that such persons shall not be excluded

4 to the extent of concurrent service and earnings not

5 designated as being for police or fire protection duties.

6 However, (i) any head of a police department who was a

7 participant under this Article immediately before October

8 1, 1977 and did not elect, under Section 3-109 of this Act,

9 to participate in a police pension fund shall be an

10 "employee", and (ii) any chief of police who ~~became a~~

11 ~~participating employee under this Article before January~~

12 ~~1, 2019 and who~~ elects to participate in this Fund under

13 Section 3-109.1 of this Code, regardless of whether such

14 person continues to be employed as chief of police or is

15 employed in some other rank or capacity within the police

16 department, shall be an employee under this Article for so

17 long as such person is employed to perform police duties

18 by a participating municipality and has not lawfully

19 rescinded that election.

20 (b-5) Were not participating employees under this

21 Article before August 26, 2018 (the effective date of

22 Public Act 100-1097) and participated as a chief of police

23 in a fund under Article 3 and return to work in any

24 capacity with the police department, with any oversight of

25 the police department, or in an advisory capacity for the

26 police department with the same municipality with which

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1 that pension was earned, regardless of whether they are

2 considered an employee of the police department or are

3 eligible for inclusion in the municipality's Article 3

4 fund.

5 (c) Are contributors to or eligible to contribute to a

6 Taft-Hartley pension plan to which the participating

7 municipality is required to contribute as the person's

8 employer based on earnings from the municipality. Nothing

9 in this paragraph shall affect service credit or

10 creditable service for any period of service prior to July

11 16, 2014 (the effective date of Public Act 98-712), and

12 this paragraph shall not apply to individuals who are

13 participating in the Fund prior to July 16, 2014 (the

14 effective date of Public Act 98-712).

15 (d) Become an employee of any of the following

16 participating instrumentalities on or after January 1,

17 2017 (the effective date of Public Act 99-830): the

18 Illinois Municipal League; the Illinois Association of

19 Park Districts; the Illinois Supervisors, County

20 Commissioners and Superintendents of Highways Association;

21 an association, or not-for-profit corporation, membership

22 in which is authorized under Section 85-15 of the Township

23 Code; the United Counties Council; or the Will County

24 Governmental League.

25 (e) Are members of the Board of Trustees of the

26 Firefighters' Pension Investment Fund, as created under

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1 Article 22C of this Code, in their capacity as members of

2 the Board of Trustees of the Firefighters' Pension

3 Investment Fund.

4 (f) Are members of the Board of Trustees of the Police

5 Officers' Pension Investment Fund, as created under

6 Article 22B of this Code, in their capacity as members of

7 the Board of Trustees of the Police Officers' Pension

8 Investment Fund.

9 (3) All persons, including, without limitation, public

10 defenders and probation officers, who receive earnings from

11 general or special funds of a county for performance of

12 personal services or official duties within the territorial

13 limits of the county, are employees of the county (unless

14 excluded by subsection (2) of this Section) notwithstanding

15 that they may be appointed by and are subject to the direction

16 of a person or persons other than a county board or a county

17 officer. It is hereby established that an employer-employee

18 relationship under the usual common law rules exists between

19 such employees and the county paying their salaries by reason

20 of the fact that the county boards fix their rates of

21 compensation, appropriate funds for payment of their earnings

22 and otherwise exercise control over them. This finding and

23 this amendatory Act shall apply to all such employees from the

24 date of appointment whether such date is prior to or after the

25 effective date of this amendatory Act and is intended to

26 clarify existing law pertaining to their status as

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1 participating employees in the Fund.

2 (Source: P.A. 102-15, eff. 6-17-21; 102-637, eff. 8-27-21;

3 102-813, eff. 5-13-22.)