Bill Text: IL HB4065 | 2023-2024 | 103rd General Assembly | Introduced

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Bill Title: Amends the General Provisions, Downstate Police, Downstate Firefighter, Chicago Police, Chicago Firefighter, Illinois Municipal Retirement Fund (IMRF), State Employees, and State Universities Articles of the Illinois Pension Code. With regard to police officers, firefighters, and similar public safety employees, removes Tier 2 limitations on the amount of salary for annuity purposes; provides that the automatic annual increases to a retirement pension or survivor pension are calculated under the Tier 1 formulas; and provides that the amount of and eligibility for a retirement annuity are calculated under the Tier 1 provisions. Amends the State Finance Act. Provides that each fiscal year, the Comptroller shall pay to each unit of local government that makes a certification of certain employer costs under the Illinois Pension Code or under a specified provision of the Public Safety Employee Benefits Act an amount equal to 40% of the total amount certified by the unit of local government. Creates a continuing appropriation of that amount. Amends the Public Safety Employee Benefits Act. Provides that a unit of local government that provides health insurance to police officers and firefighters shall maintain the health insurance plans of these employees after retirement and shall contribute toward the cost of the annuitant's coverage under the unit of local government's health insurance plan an amount equal to 4% of that cost for each full year of creditable service upon which the annuitant's retirement annuity is based. Makes other and conforming changes. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.

Spectrum: Bipartisan Bill

Status: (Introduced) 2023-05-04 - Referred to Rules Committee [HB4065 Detail]

Download: Illinois-2023-HB4065-Introduced.html

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103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB4065 Introduced , by Rep. Justin Slaughter SYNOPSIS AS INTRODUCED:
See Index
Amends the General Provisions, Downstate Police, Downstate Firefighter, Chicago Police, Chicago Firefighter, Illinois Municipal Retirement Fund (IMRF), State Employees, and State Universities Articles of the Illinois Pension Code. With regard to police officers, firefighters, and similar public safety employees, removes Tier 2 limitations on the amount of salary for annuity purposes; provides that the automatic annual increases to a retirement pension or survivor pension are calculated under the Tier 1 formulas; and provides that the amount of and eligibility for a retirement annuity are calculated under the Tier 1 provisions. Amends the State Finance Act. Provides that each fiscal year, the Comptroller shall pay to each unit of local government that makes a certification of certain employer costs under the Illinois Pension Code or under a specified provision of the Public Safety Employee Benefits Act an amount equal to 40% of the total amount certified by the unit of local government. Creates a continuing appropriation of that amount. Amends the Public Safety Employee Benefits Act. Provides that a unit of local government that provides health insurance to police officers and firefighters shall maintain the health insurance plans of these employees after retirement and shall contribute toward the cost of the annuitant's coverage under the unit of local government's health insurance plan an amount equal to 4% of that cost for each full year of creditable service upon which the annuitant's retirement annuity is based. Makes other and conforming changes. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.
LRB103 31966 RPS 60743 b
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY
A BILL FOR
HB4065 LRB103 31966 RPS 60743 b
AN ACT concerning public employee benefits.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The State Finance Act is amended by adding
Sections 5.990 and 6z-139 as follows:
(30 ILCS 105/5.990 new)
Sec. 5.990. The Local Government Retirement Fund.
(30 ILCS 105/6z-139 new)
Sec. 6z-139. The Local Government Retirement Fund.
(a) There is created in the State treasury a special fund
known as the Local Government Retirement Fund for the purpose
of receiving funds from any source for the purposes of making
payments toward public safety employee health insurance costs
and retirement contributions as provided in this Section.
(b) Each fiscal year beginning with fiscal year 2024, the
State Treasurer shall direct the State Comptroller to pay to
each unit of local government that makes a certification under
Sections 3-125, 4-118, 5-168, 6-165, and 7-172 of the Illinois
Pension Code or under Section 11 of the Public Safety Employee
Benefits Act an amount equal to 40% of the total amount
certified by that unit of local government under all of the
applicable Sections.

HB4065 - 2 - LRB103 31966 RPS 60743 b
(c) If, for any reason, the aggregate appropriations made
available are insufficient to meet the amount required in
subsection (b), this Section shall constitute a continuing
appropriation of the amount required under subsection (b).
Section 10. The Illinois Pension Code is amended by
changing Sections 1-160, 3-111, 3-111.1, 3-112, 3-125, 4-109,
4-109.1, 4-114, 4-118, 5-155, 5-167.1, 5-168, 5-169, 6-165,
6-210, 7-142.1, 7-171, 7-172, 14-152.1, 15-108.1, 15-108.2,
15-135, 15-136, and 15-198 and by adding Sections 3-148.5,
4-138.15, 5-239, 6-231, and 15-203 as follows:
(40 ILCS 5/1-160)
(Text of Section from P.A. 102-719)
Sec. 1-160. Provisions applicable to new hires.
(a) The provisions of this Section apply to a person who,
on or after January 1, 2011, first becomes a member or a
participant under any reciprocal retirement system or pension
fund established under this Code, other than a retirement
system or pension fund established under Article 2, 3, 4, 5, 6,
7, 15, or 18 of this Code, notwithstanding any other provision
of this Code to the contrary, but do not apply to any
self-managed plan established under this Code or to any
participant of the retirement plan established under Section
22-101; except that this Section applies to a person who
elected to establish alternative credits by electing in

HB4065 - 3 - LRB103 31966 RPS 60743 b
writing after January 1, 2011, but before August 8, 2011,
under Section 7-145.1 of this Code. Notwithstanding anything
to the contrary in this Section, for purposes of this Section,
a person who is a Tier 1 regular employee as defined in Section
7-109.4 of this Code or who participated in a retirement
system under Article 15 prior to January 1, 2011 shall be
deemed a person who first became a member or participant prior
to January 1, 2011 under any retirement system or pension fund
subject to this Section. The changes made to this Section by
Public Act 98-596 are a clarification of existing law and are
intended to be retroactive to January 1, 2011 (the effective
date of Public Act 96-889), notwithstanding the provisions of
Section 1-103.1 of this Code.
This Section does not apply to a person who first becomes a
noncovered employee under Article 14 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided
under this Section and the applicable provisions of that
Article.
This Section does not apply to a person who first becomes a
member or participant under Article 16 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided
under this Section and the applicable provisions of that

HB4065 - 4 - LRB103 31966 RPS 60743 b
Article.
This Section does not apply to a person who elects under
subsection (c-5) of Section 1-161 to receive the benefits
under Section 1-161.
This Section does not apply to a person who first becomes a
member or participant of an affected pension fund on or after 6
months after the resolution or ordinance date, as defined in
Section 1-162, unless that person elects under subsection (c)
of Section 1-162 to receive the benefits provided under this
Section and the applicable provisions of the Article under
which he or she is a member or participant.
(b) "Final average salary" means, except as otherwise
provided in this subsection, the average monthly (or annual)
salary obtained by dividing the total salary or earnings
calculated under the Article applicable to the member or
participant during the 96 consecutive months (or 8 consecutive
years) of service within the last 120 months (or 10 years) of
service in which the total salary or earnings calculated under
the applicable Article was the highest by the number of months
(or years) of service in that period. For the purposes of a
person who first becomes a member or participant of any
retirement system or pension fund to which this Section
applies on or after January 1, 2011, in this Code, "final
average salary" shall be substituted for the following:
(1) (Blank).
(2) In Articles 8, 9, 10, 11, and 12, "highest average

HB4065 - 5 - LRB103 31966 RPS 60743 b
annual salary for any 4 consecutive years within the last
10 years of service immediately preceding the date of
withdrawal".
(3) In Article 13, "average final salary".
(4) In Article 14, "final average compensation".
(5) In Article 17, "average salary".
(6) In Section 22-207, "wages or salary received by
him at the date of retirement or discharge".
A member of the Teachers' Retirement System of the State
of Illinois who retires on or after June 1, 2021 and for whom
the 2020-2021 school year is used in the calculation of the
member's final average salary shall use the higher of the
following for the purpose of determining the member's final
average salary:
(A) the amount otherwise calculated under the first
paragraph of this subsection; or
(B) an amount calculated by the Teachers' Retirement
System of the State of Illinois using the average of the
monthly (or annual) salary obtained by dividing the total
salary or earnings calculated under Article 16 applicable
to the member or participant during the 96 months (or 8
years) of service within the last 120 months (or 10 years)
of service in which the total salary or earnings
calculated under the Article was the highest by the number
of months (or years) of service in that period.
(b-5) Beginning on January 1, 2011, for all purposes under

HB4065 - 6 - LRB103 31966 RPS 60743 b
this Code (including without limitation the calculation of
benefits and employee contributions), the annual earnings,
salary, or wages (based on the plan year) of a member or
participant to whom this Section applies shall not exceed
$106,800; however, that amount shall annually thereafter be
increased by the lesser of (i) 3% of that amount, including all
previous adjustments, or (ii) one-half the annual unadjusted
percentage increase (but not less than zero) in the consumer
price index-u for the 12 months ending with the September
preceding each November 1, including all previous adjustments.
For the purposes of this Section, "consumer price index-u"
means the index published by the Bureau of Labor Statistics of
the United States Department of Labor that measures the
average change in prices of goods and services purchased by
all urban consumers, United States city average, all items,
1982-84 = 100. The new amount resulting from each annual
adjustment shall be determined by the Public Pension Division
of the Department of Insurance and made available to the
boards of the retirement systems and pension funds by November
1 of each year.
(c) A member or participant is entitled to a retirement
annuity upon written application if he or she has attained age
67 (age 65, with respect to service under Article 12 that is
subject to this Section, for a member or participant under
Article 12 who first becomes a member or participant under
Article 12 on or after January 1, 2022 or who makes the

HB4065 - 7 - LRB103 31966 RPS 60743 b
election under item (i) of subsection (d-15) of this Section)
and has at least 10 years of service credit and is otherwise
eligible under the requirements of the applicable Article.
A member or participant who has attained age 62 (age 60,
with respect to service under Article 12 that is subject to
this Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15) of this Section) and has at least 10 years
of service credit and is otherwise eligible under the
requirements of the applicable Article may elect to receive
the lower retirement annuity provided in subsection (d) of
this Section.
(c-5) A person who first becomes a member or a participant
subject to this Section on or after July 6, 2017 (the effective
date of Public Act 100-23), notwithstanding any other
provision of this Code to the contrary, is entitled to a
retirement annuity under Article 8 or Article 11 upon written
application if he or she has attained age 65 and has at least
10 years of service credit and is otherwise eligible under the
requirements of Article 8 or Article 11 of this Code,
whichever is applicable.
(d) The retirement annuity of a member or participant who
is retiring after attaining age 62 (age 60, with respect to
service under Article 12 that is subject to this Section, for a
member or participant under Article 12 who first becomes a

HB4065 - 8 - LRB103 31966 RPS 60743 b
member or participant under Article 12 on or after January 1,
2022 or who makes the election under item (i) of subsection
(d-15) of this Section) with at least 10 years of service
credit shall be reduced by one-half of 1% for each full month
that the member's age is under age 67 (age 65, with respect to
service under Article 12 that is subject to this Section, for a
member or participant under Article 12 who first becomes a
member or participant under Article 12 on or after January 1,
2022 or who makes the election under item (i) of subsection
(d-15) of this Section).
(d-5) The retirement annuity payable under Article 8 or
Article 11 to an eligible person subject to subsection (c-5)
of this Section who is retiring at age 60 with at least 10
years of service credit shall be reduced by one-half of 1% for
each full month that the member's age is under age 65.
(d-10) Each person who first became a member or
participant under Article 8 or Article 11 of this Code on or
after January 1, 2011 and prior to July 6, 2017 (the effective
date of Public Act 100-23) shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
provided in subsections (c-5) and (d-5) of this Section,
the eligibility for which is conditioned upon the member
or participant agreeing to the increases in employee
contributions for age and service annuities provided in
subsection (a-5) of Section 8-174 of this Code (for

HB4065 - 9 - LRB103 31966 RPS 60743 b
service under Article 8) or subsection (a-5) of Section
11-170 of this Code (for service under Article 11); or
(ii) to not agree to item (i) of this subsection
(d-10), in which case the member or participant shall
continue to be subject to the retirement age provisions in
subsections (c) and (d) of this Section and the employee
contributions for age and service annuity as provided in
subsection (a) of Section 8-174 of this Code (for service
under Article 8) or subsection (a) of Section 11-170 of
this Code (for service under Article 11).
The election provided for in this subsection shall be made
between October 1, 2017 and November 15, 2017. A person
subject to this subsection who makes the required election
shall remain bound by that election. A person subject to this
subsection who fails for any reason to make the required
election within the time specified in this subsection shall be
deemed to have made the election under item (ii).
(d-15) Each person who first becomes a member or
participant under Article 12 on or after January 1, 2011 and
prior to January 1, 2022 shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
specified in subsections (c) and (d) of this Section, the
eligibility for which is conditioned upon the member or
participant agreeing to the increase in employee
contributions for service annuities specified in

HB4065 - 10 - LRB103 31966 RPS 60743 b
subsection (b) of Section 12-150; or
(ii) to not agree to item (i) of this subsection
(d-15), in which case the member or participant shall not
be eligible for the reduced retirement age specified in
subsections (c) and (d) of this Section and shall not be
subject to the increase in employee contributions for
service annuities specified in subsection (b) of Section
12-150.
The election provided for in this subsection shall be made
between January 1, 2022 and April 1, 2022. A person subject to
this subsection who makes the required election shall remain
bound by that election. A person subject to this subsection
who fails for any reason to make the required election within
the time specified in this subsection shall be deemed to have
made the election under item (ii).
(e) Any retirement annuity or supplemental annuity shall
be subject to annual increases on the January 1 occurring
either on or after the attainment of age 67 (age 65, with
respect to service under Article 12 that is subject to this
Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15); and beginning on July 6, 2017 (the
effective date of Public Act 100-23), age 65 with respect to
service under Article 8 or Article 11 for eligible persons
who: (i) are subject to subsection (c-5) of this Section; or

HB4065 - 11 - LRB103 31966 RPS 60743 b
(ii) made the election under item (i) of subsection (d-10) of
this Section) or the first anniversary of the annuity start
date, whichever is later. Each annual increase shall be
calculated at 3% or one-half the annual unadjusted percentage
increase (but not less than zero) in the consumer price
index-u for the 12 months ending with the September preceding
each November 1, whichever is less, of the originally granted
retirement annuity. If the annual unadjusted percentage change
in the consumer price index-u for the 12 months ending with the
September preceding each November 1 is zero or there is a
decrease, then the annuity shall not be increased.
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 102-263 are
applicable without regard to whether the employee was in
active service on or after August 6, 2021 (the effective date
of Public Act 102-263).
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 100-23 are
applicable without regard to whether the employee was in
active service on or after July 6, 2017 (the effective date of
Public Act 100-23).
(f) The initial survivor's or widow's annuity of an
otherwise eligible survivor or widow of a retired member or
participant who first became a member or participant on or
after January 1, 2011 shall be in the amount of 66 2/3% of the
retired member's or participant's retirement annuity at the

HB4065 - 12 - LRB103 31966 RPS 60743 b
date of death. In the case of the death of a member or
participant who has not retired and who first became a member
or participant on or after January 1, 2011, eligibility for a
survivor's or widow's annuity shall be determined by the
applicable Article of this Code. The initial benefit shall be
66 2/3% of the earned annuity without a reduction due to age. A
child's annuity of an otherwise eligible child shall be in the
amount prescribed under each Article if applicable. Any
survivor's or widow's annuity shall be increased (1) on each
January 1 occurring on or after the commencement of the
annuity if the deceased member died while receiving a
retirement annuity or (2) in other cases, on each January 1
occurring after the first anniversary of the commencement of
the annuity. Each annual increase shall be calculated at 3% or
one-half the annual unadjusted percentage increase (but not
less than zero) in the consumer price index-u for the 12 months
ending with the September preceding each November 1, whichever
is less, of the originally granted survivor's annuity. If the
annual unadjusted percentage change in the consumer price
index-u for the 12 months ending with the September preceding
each November 1 is zero or there is a decrease, then the
annuity shall not be increased.
(g) This Section does not apply to a person who The
benefits in Section 14-110 apply if the person is a fire
fighter in the fire protection service of a department, a
security employee of the Department of Corrections or the

HB4065 - 13 - LRB103 31966 RPS 60743 b
Department of Juvenile Justice, or a security employee of the
Department of Innovation and Technology, as those terms are
defined in subsection (b) and subsection (c) of Section
14-110. A person who meets the requirements of this Section is
entitled to an annuity calculated under the provisions of
Section 14-110, in lieu of the regular or minimum retirement
annuity, only if the person has withdrawn from service with
not less than 20 years of eligible creditable service and has
attained age 60, regardless of whether the attainment of age
60 occurs while the person is still in service.
(g-5) This Section does not apply to a person who The
benefits in Section 14-110 apply if the person is a State
policeman, investigator for the Secretary of State,
conservation police officer, investigator for the Department
of Revenue or the Illinois Gaming Board, investigator for the
Office of the Attorney General, Commerce Commission police
officer, or arson investigator, as those terms are defined in
subsection (b) and subsection (c) of Section 14-110. A person
who meets the requirements of this Section is entitled to an
annuity calculated under the provisions of Section 14-110, in
lieu of the regular or minimum retirement annuity, only if the
person has withdrawn from service with not less than 20 years
of eligible creditable service and has attained age 55,
regardless of whether the attainment of age 55 occurs while
the person is still in service.
(h) If a person who first becomes a member or a participant

HB4065 - 14 - LRB103 31966 RPS 60743 b
of a retirement system or pension fund subject to this Section
on or after January 1, 2011 is receiving a retirement annuity
or retirement pension under that system or fund and becomes a
member or participant under any other system or fund created
by this Code and is employed on a full-time basis, except for
those members or participants exempted from the provisions of
this Section under subsection (a) of this Section, then the
person's retirement annuity or retirement pension under that
system or fund shall be suspended during that employment. Upon
termination of that employment, the person's retirement
annuity or retirement pension payments shall resume and be
recalculated if recalculation is provided for under the
applicable Article of this Code.
If a person who first becomes a member of a retirement
system or pension fund subject to this Section on or after
January 1, 2012 and is receiving a retirement annuity or
retirement pension under that system or fund and accepts on a
contractual basis a position to provide services to a
governmental entity from which he or she has retired, then
that person's annuity or retirement pension earned as an
active employee of the employer shall be suspended during that
contractual service. A person receiving an annuity or
retirement pension under this Code shall notify the pension
fund or retirement system from which he or she is receiving an
annuity or retirement pension, as well as his or her
contractual employer, of his or her retirement status before

HB4065 - 15 - LRB103 31966 RPS 60743 b
accepting contractual employment. A person who fails to submit
such notification shall be guilty of a Class A misdemeanor and
required to pay a fine of $1,000. Upon termination of that
contractual employment, the person's retirement annuity or
retirement pension payments shall resume and, if appropriate,
be recalculated under the applicable provisions of this Code.
(i) (Blank).
(i-5) It is the intent of this amendatory Act of the 103rd
General Assembly to provide to the participants specified in
subsections (g) and (g-5) who first became participants on or
after January 1, 2011 the same level of benefits and
eligibility criteria for benefits as those who first became
participants before January 1, 2011. The changes made to this
Article by this amendatory Act of the 103rd General Assembly
that provide benefit increases for participants specified in
subsections (g) and (g-5) apply without regard to whether the
participant was in service on or after the effective date of
this amendatory Act of the 103rd General Assembly,
notwithstanding the provisions of Section 1-103.1. The benefit
increases are intended to apply prospectively and do not
entitle a participant to retroactive benefit payments or
increases. The changes made to this Article by this amendatory
Act of the 103rd General Assembly shall not cause or otherwise
result in any retroactive adjustment of any employee
contributions.
(j) In the case of a conflict between the provisions of

HB4065 - 16 - LRB103 31966 RPS 60743 b
this Section and any other provision of this Code, the
provisions of this Section shall control.
(Source: P.A. 101-610, eff. 1-1-20; 102-16, eff. 6-17-21;
102-210, eff. 1-1-22; 102-263, eff. 8-6-21; 102-719, eff.
5-6-22.)
(Text of Section from P.A. 102-813)
Sec. 1-160. Provisions applicable to new hires.
(a) The provisions of this Section apply to a person who,
on or after January 1, 2011, first becomes a member or a
participant under any reciprocal retirement system or pension
fund established under this Code, other than a retirement
system or pension fund established under Article 2, 3, 4, 5, 6,
7, 15, or 18 of this Code, notwithstanding any other provision
of this Code to the contrary, but do not apply to any
self-managed plan established under this Code or to any
participant of the retirement plan established under Section
22-101; except that this Section applies to a person who
elected to establish alternative credits by electing in
writing after January 1, 2011, but before August 8, 2011,
under Section 7-145.1 of this Code. Notwithstanding anything
to the contrary in this Section, for purposes of this Section,
a person who is a Tier 1 regular employee as defined in Section
7-109.4 of this Code or who participated in a retirement
system under Article 15 prior to January 1, 2011 shall be
deemed a person who first became a member or participant prior

HB4065 - 17 - LRB103 31966 RPS 60743 b
to January 1, 2011 under any retirement system or pension fund
subject to this Section. The changes made to this Section by
Public Act 98-596 are a clarification of existing law and are
intended to be retroactive to January 1, 2011 (the effective
date of Public Act 96-889), notwithstanding the provisions of
Section 1-103.1 of this Code.
This Section does not apply to a person who first becomes a
noncovered employee under Article 14 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided
under this Section and the applicable provisions of that
Article.
This Section does not apply to a person who first becomes a
member or participant under Article 16 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided
under this Section and the applicable provisions of that
Article.
This Section does not apply to a person who elects under
subsection (c-5) of Section 1-161 to receive the benefits
under Section 1-161.
This Section does not apply to a person who first becomes a
member or participant of an affected pension fund on or after 6
months after the resolution or ordinance date, as defined in

HB4065 - 18 - LRB103 31966 RPS 60743 b
Section 1-162, unless that person elects under subsection (c)
of Section 1-162 to receive the benefits provided under this
Section and the applicable provisions of the Article under
which he or she is a member or participant.
(b) "Final average salary" means, except as otherwise
provided in this subsection, the average monthly (or annual)
salary obtained by dividing the total salary or earnings
calculated under the Article applicable to the member or
participant during the 96 consecutive months (or 8 consecutive
years) of service within the last 120 months (or 10 years) of
service in which the total salary or earnings calculated under
the applicable Article was the highest by the number of months
(or years) of service in that period. For the purposes of a
person who first becomes a member or participant of any
retirement system or pension fund to which this Section
applies on or after January 1, 2011, in this Code, "final
average salary" shall be substituted for the following:
(1) (Blank).
(2) In Articles 8, 9, 10, 11, and 12, "highest average
annual salary for any 4 consecutive years within the last
10 years of service immediately preceding the date of
withdrawal".
(3) In Article 13, "average final salary".
(4) In Article 14, "final average compensation".
(5) In Article 17, "average salary".
(6) In Section 22-207, "wages or salary received by

HB4065 - 19 - LRB103 31966 RPS 60743 b
him at the date of retirement or discharge".
A member of the Teachers' Retirement System of the State
of Illinois who retires on or after June 1, 2021 and for whom
the 2020-2021 school year is used in the calculation of the
member's final average salary shall use the higher of the
following for the purpose of determining the member's final
average salary:
(A) the amount otherwise calculated under the first
paragraph of this subsection; or
(B) an amount calculated by the Teachers' Retirement
System of the State of Illinois using the average of the
monthly (or annual) salary obtained by dividing the total
salary or earnings calculated under Article 16 applicable
to the member or participant during the 96 months (or 8
years) of service within the last 120 months (or 10 years)
of service in which the total salary or earnings
calculated under the Article was the highest by the number
of months (or years) of service in that period.
(b-5) Beginning on January 1, 2011, for all purposes under
this Code (including without limitation the calculation of
benefits and employee contributions), the annual earnings,
salary, or wages (based on the plan year) of a member or
participant to whom this Section applies shall not exceed
$106,800; however, that amount shall annually thereafter be
increased by the lesser of (i) 3% of that amount, including all
previous adjustments, or (ii) one-half the annual unadjusted

HB4065 - 20 - LRB103 31966 RPS 60743 b
percentage increase (but not less than zero) in the consumer
price index-u for the 12 months ending with the September
preceding each November 1, including all previous adjustments.
For the purposes of this Section, "consumer price index-u"
means the index published by the Bureau of Labor Statistics of
the United States Department of Labor that measures the
average change in prices of goods and services purchased by
all urban consumers, United States city average, all items,
1982-84 = 100. The new amount resulting from each annual
adjustment shall be determined by the Public Pension Division
of the Department of Insurance and made available to the
boards of the retirement systems and pension funds by November
1 of each year.
(c) A member or participant is entitled to a retirement
annuity upon written application if he or she has attained age
67 (age 65, with respect to service under Article 12 that is
subject to this Section, for a member or participant under
Article 12 who first becomes a member or participant under
Article 12 on or after January 1, 2022 or who makes the
election under item (i) of subsection (d-15) of this Section)
and has at least 10 years of service credit and is otherwise
eligible under the requirements of the applicable Article.
A member or participant who has attained age 62 (age 60,
with respect to service under Article 12 that is subject to
this Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or

HB4065 - 21 - LRB103 31966 RPS 60743 b
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15) of this Section) and has at least 10 years
of service credit and is otherwise eligible under the
requirements of the applicable Article may elect to receive
the lower retirement annuity provided in subsection (d) of
this Section.
(c-5) A person who first becomes a member or a participant
subject to this Section on or after July 6, 2017 (the effective
date of Public Act 100-23), notwithstanding any other
provision of this Code to the contrary, is entitled to a
retirement annuity under Article 8 or Article 11 upon written
application if he or she has attained age 65 and has at least
10 years of service credit and is otherwise eligible under the
requirements of Article 8 or Article 11 of this Code,
whichever is applicable.
(d) The retirement annuity of a member or participant who
is retiring after attaining age 62 (age 60, with respect to
service under Article 12 that is subject to this Section, for a
member or participant under Article 12 who first becomes a
member or participant under Article 12 on or after January 1,
2022 or who makes the election under item (i) of subsection
(d-15) of this Section) with at least 10 years of service
credit shall be reduced by one-half of 1% for each full month
that the member's age is under age 67 (age 65, with respect to
service under Article 12 that is subject to this Section, for a
member or participant under Article 12 who first becomes a

HB4065 - 22 - LRB103 31966 RPS 60743 b
member or participant under Article 12 on or after January 1,
2022 or who makes the election under item (i) of subsection
(d-15) of this Section).
(d-5) The retirement annuity payable under Article 8 or
Article 11 to an eligible person subject to subsection (c-5)
of this Section who is retiring at age 60 with at least 10
years of service credit shall be reduced by one-half of 1% for
each full month that the member's age is under age 65.
(d-10) Each person who first became a member or
participant under Article 8 or Article 11 of this Code on or
after January 1, 2011 and prior to July 6, 2017 (the effective
date of Public Act 100-23) shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
provided in subsections (c-5) and (d-5) of this Section,
the eligibility for which is conditioned upon the member
or participant agreeing to the increases in employee
contributions for age and service annuities provided in
subsection (a-5) of Section 8-174 of this Code (for
service under Article 8) or subsection (a-5) of Section
11-170 of this Code (for service under Article 11); or
(ii) to not agree to item (i) of this subsection
(d-10), in which case the member or participant shall
continue to be subject to the retirement age provisions in
subsections (c) and (d) of this Section and the employee
contributions for age and service annuity as provided in

HB4065 - 23 - LRB103 31966 RPS 60743 b
subsection (a) of Section 8-174 of this Code (for service
under Article 8) or subsection (a) of Section 11-170 of
this Code (for service under Article 11).
The election provided for in this subsection shall be made
between October 1, 2017 and November 15, 2017. A person
subject to this subsection who makes the required election
shall remain bound by that election. A person subject to this
subsection who fails for any reason to make the required
election within the time specified in this subsection shall be
deemed to have made the election under item (ii).
(d-15) Each person who first becomes a member or
participant under Article 12 on or after January 1, 2011 and
prior to January 1, 2022 shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
specified in subsections (c) and (d) of this Section, the
eligibility for which is conditioned upon the member or
participant agreeing to the increase in employee
contributions for service annuities specified in
subsection (b) of Section 12-150; or
(ii) to not agree to item (i) of this subsection
(d-15), in which case the member or participant shall not
be eligible for the reduced retirement age specified in
subsections (c) and (d) of this Section and shall not be
subject to the increase in employee contributions for
service annuities specified in subsection (b) of Section

HB4065 - 24 - LRB103 31966 RPS 60743 b
12-150.
The election provided for in this subsection shall be made
between January 1, 2022 and April 1, 2022. A person subject to
this subsection who makes the required election shall remain
bound by that election. A person subject to this subsection
who fails for any reason to make the required election within
the time specified in this subsection shall be deemed to have
made the election under item (ii).
(e) Any retirement annuity or supplemental annuity shall
be subject to annual increases on the January 1 occurring
either on or after the attainment of age 67 (age 65, with
respect to service under Article 12 that is subject to this
Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15); and beginning on July 6, 2017 (the
effective date of Public Act 100-23), age 65 with respect to
service under Article 8 or Article 11 for eligible persons
who: (i) are subject to subsection (c-5) of this Section; or
(ii) made the election under item (i) of subsection (d-10) of
this Section) or the first anniversary of the annuity start
date, whichever is later. Each annual increase shall be
calculated at 3% or one-half the annual unadjusted percentage
increase (but not less than zero) in the consumer price
index-u for the 12 months ending with the September preceding
each November 1, whichever is less, of the originally granted

HB4065 - 25 - LRB103 31966 RPS 60743 b
retirement annuity. If the annual unadjusted percentage change
in the consumer price index-u for the 12 months ending with the
September preceding each November 1 is zero or there is a
decrease, then the annuity shall not be increased.
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 102-263 are
applicable without regard to whether the employee was in
active service on or after August 6, 2021 (the effective date
of Public Act 102-263).
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 100-23 are
applicable without regard to whether the employee was in
active service on or after July 6, 2017 (the effective date of
Public Act 100-23).
(f) The initial survivor's or widow's annuity of an
otherwise eligible survivor or widow of a retired member or
participant who first became a member or participant on or
after January 1, 2011 shall be in the amount of 66 2/3% of the
retired member's or participant's retirement annuity at the
date of death. In the case of the death of a member or
participant who has not retired and who first became a member
or participant on or after January 1, 2011, eligibility for a
survivor's or widow's annuity shall be determined by the
applicable Article of this Code. The initial benefit shall be
66 2/3% of the earned annuity without a reduction due to age. A
child's annuity of an otherwise eligible child shall be in the

HB4065 - 26 - LRB103 31966 RPS 60743 b
amount prescribed under each Article if applicable. Any
survivor's or widow's annuity shall be increased (1) on each
January 1 occurring on or after the commencement of the
annuity if the deceased member died while receiving a
retirement annuity or (2) in other cases, on each January 1
occurring after the first anniversary of the commencement of
the annuity. Each annual increase shall be calculated at 3% or
one-half the annual unadjusted percentage increase (but not
less than zero) in the consumer price index-u for the 12 months
ending with the September preceding each November 1, whichever
is less, of the originally granted survivor's annuity. If the
annual unadjusted percentage change in the consumer price
index-u for the 12 months ending with the September preceding
each November 1 is zero or there is a decrease, then the
annuity shall not be increased.
(g) This Section does not apply to a person who The
benefits in Section 14-110 apply only if the person is a State
policeman, a fire fighter in the fire protection service of a
department, a conservation police officer, an investigator for
the Secretary of State, an arson investigator, a Commerce
Commission police officer, investigator for the Department of
Revenue or the Illinois Gaming Board, a security employee of
the Department of Corrections or the Department of Juvenile
Justice, or a security employee of the Department of
Innovation and Technology, as those terms are defined in
subsection (b) and subsection (c) of Section 14-110. A person

HB4065 - 27 - LRB103 31966 RPS 60743 b
who meets the requirements of this Section is entitled to an
annuity calculated under the provisions of Section 14-110, in
lieu of the regular or minimum retirement annuity, only if the
person has withdrawn from service with not less than 20 years
of eligible creditable service and has attained age 60,
regardless of whether the attainment of age 60 occurs while
the person is still in service.
(h) If a person who first becomes a member or a participant
of a retirement system or pension fund subject to this Section
on or after January 1, 2011 is receiving a retirement annuity
or retirement pension under that system or fund and becomes a
member or participant under any other system or fund created
by this Code and is employed on a full-time basis, except for
those members or participants exempted from the provisions of
this Section under subsection (a) of this Section, then the
person's retirement annuity or retirement pension under that
system or fund shall be suspended during that employment. Upon
termination of that employment, the person's retirement
annuity or retirement pension payments shall resume and be
recalculated if recalculation is provided for under the
applicable Article of this Code.
If a person who first becomes a member of a retirement
system or pension fund subject to this Section on or after
January 1, 2012 and is receiving a retirement annuity or
retirement pension under that system or fund and accepts on a
contractual basis a position to provide services to a

HB4065 - 28 - LRB103 31966 RPS 60743 b
governmental entity from which he or she has retired, then
that person's annuity or retirement pension earned as an
active employee of the employer shall be suspended during that
contractual service. A person receiving an annuity or
retirement pension under this Code shall notify the pension
fund or retirement system from which he or she is receiving an
annuity or retirement pension, as well as his or her
contractual employer, of his or her retirement status before
accepting contractual employment. A person who fails to submit
such notification shall be guilty of a Class A misdemeanor and
required to pay a fine of $1,000. Upon termination of that
contractual employment, the person's retirement annuity or
retirement pension payments shall resume and, if appropriate,
be recalculated under the applicable provisions of this Code.
(i) (Blank).
(i-5) It is the intent of this amendatory Act of the 103rd
General Assembly to provide to the participants specified in
subsections (g) and (g-5) who first became participants on or
after January 1, 2011 the same level of benefits and
eligibility criteria for benefits as those who first became
participants before January 1, 2011. The changes made to this
Article by this amendatory Act of the 103rd General Assembly
that provide benefit increases for participants specified in
subsections (g) and (g-5) apply without regard to whether the
participant was in service on or after the effective date of
this amendatory Act of the 103rd General Assembly,

HB4065 - 29 - LRB103 31966 RPS 60743 b
notwithstanding the provisions of Section 1-103.1. The benefit
increases are intended to apply prospectively and do not
entitle a participant to retroactive benefit payments or
increases. The changes made to this Article by this amendatory
Act of the 103rd General Assembly shall not cause or otherwise
result in any retroactive adjustment of any employee
contributions.
(j) In the case of a conflict between the provisions of
this Section and any other provision of this Code, the
provisions of this Section shall control.
(Source: P.A. 101-610, eff. 1-1-20; 102-16, eff. 6-17-21;
102-210, eff. 1-1-22; 102-263, eff. 8-6-21; 102-813, eff.
5-13-22.)
(Text of Section from P.A. 102-956)
Sec. 1-160. Provisions applicable to new hires.
(a) The provisions of this Section apply to a person who,
on or after January 1, 2011, first becomes a member or a
participant under any reciprocal retirement system or pension
fund established under this Code, other than a retirement
system or pension fund established under Article 2, 3, 4, 5, 6,
7, 15, or 18 of this Code, notwithstanding any other provision
of this Code to the contrary, but do not apply to any
self-managed plan established under this Code or to any
participant of the retirement plan established under Section
22-101; except that this Section applies to a person who

HB4065 - 30 - LRB103 31966 RPS 60743 b
elected to establish alternative credits by electing in
writing after January 1, 2011, but before August 8, 2011,
under Section 7-145.1 of this Code. Notwithstanding anything
to the contrary in this Section, for purposes of this Section,
a person who is a Tier 1 regular employee as defined in Section
7-109.4 of this Code or who participated in a retirement
system under Article 15 prior to January 1, 2011 shall be
deemed a person who first became a member or participant prior
to January 1, 2011 under any retirement system or pension fund
subject to this Section. The changes made to this Section by
Public Act 98-596 are a clarification of existing law and are
intended to be retroactive to January 1, 2011 (the effective
date of Public Act 96-889), notwithstanding the provisions of
Section 1-103.1 of this Code.
This Section does not apply to a person who first becomes a
noncovered employee under Article 14 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided
under this Section and the applicable provisions of that
Article.
This Section does not apply to a person who first becomes a
member or participant under Article 16 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided

HB4065 - 31 - LRB103 31966 RPS 60743 b
under this Section and the applicable provisions of that
Article.
This Section does not apply to a person who elects under
subsection (c-5) of Section 1-161 to receive the benefits
under Section 1-161.
This Section does not apply to a person who first becomes a
member or participant of an affected pension fund on or after 6
months after the resolution or ordinance date, as defined in
Section 1-162, unless that person elects under subsection (c)
of Section 1-162 to receive the benefits provided under this
Section and the applicable provisions of the Article under
which he or she is a member or participant.
(b) "Final average salary" means, except as otherwise
provided in this subsection, the average monthly (or annual)
salary obtained by dividing the total salary or earnings
calculated under the Article applicable to the member or
participant during the 96 consecutive months (or 8 consecutive
years) of service within the last 120 months (or 10 years) of
service in which the total salary or earnings calculated under
the applicable Article was the highest by the number of months
(or years) of service in that period. For the purposes of a
person who first becomes a member or participant of any
retirement system or pension fund to which this Section
applies on or after January 1, 2011, in this Code, "final
average salary" shall be substituted for the following:
(1) (Blank).

HB4065 - 32 - LRB103 31966 RPS 60743 b
(2) In Articles 8, 9, 10, 11, and 12, "highest average
annual salary for any 4 consecutive years within the last
10 years of service immediately preceding the date of
withdrawal".
(3) In Article 13, "average final salary".
(4) In Article 14, "final average compensation".
(5) In Article 17, "average salary".
(6) In Section 22-207, "wages or salary received by
him at the date of retirement or discharge".
A member of the Teachers' Retirement System of the State
of Illinois who retires on or after June 1, 2021 and for whom
the 2020-2021 school year is used in the calculation of the
member's final average salary shall use the higher of the
following for the purpose of determining the member's final
average salary:
(A) the amount otherwise calculated under the first
paragraph of this subsection; or
(B) an amount calculated by the Teachers' Retirement
System of the State of Illinois using the average of the
monthly (or annual) salary obtained by dividing the total
salary or earnings calculated under Article 16 applicable
to the member or participant during the 96 months (or 8
years) of service within the last 120 months (or 10 years)
of service in which the total salary or earnings
calculated under the Article was the highest by the number
of months (or years) of service in that period.

HB4065 - 33 - LRB103 31966 RPS 60743 b
(b-5) Beginning on January 1, 2011, for all purposes under
this Code (including without limitation the calculation of
benefits and employee contributions), the annual earnings,
salary, or wages (based on the plan year) of a member or
participant to whom this Section applies shall not exceed
$106,800; however, that amount shall annually thereafter be
increased by the lesser of (i) 3% of that amount, including all
previous adjustments, or (ii) one-half the annual unadjusted
percentage increase (but not less than zero) in the consumer
price index-u for the 12 months ending with the September
preceding each November 1, including all previous adjustments.
For the purposes of this Section, "consumer price index-u"
means the index published by the Bureau of Labor Statistics of
the United States Department of Labor that measures the
average change in prices of goods and services purchased by
all urban consumers, United States city average, all items,
1982-84 = 100. The new amount resulting from each annual
adjustment shall be determined by the Public Pension Division
of the Department of Insurance and made available to the
boards of the retirement systems and pension funds by November
1 of each year.
(c) A member or participant is entitled to a retirement
annuity upon written application if he or she has attained age
67 (age 65, with respect to service under Article 12 that is
subject to this Section, for a member or participant under
Article 12 who first becomes a member or participant under

HB4065 - 34 - LRB103 31966 RPS 60743 b
Article 12 on or after January 1, 2022 or who makes the
election under item (i) of subsection (d-15) of this Section)
and has at least 10 years of service credit and is otherwise
eligible under the requirements of the applicable Article.
A member or participant who has attained age 62 (age 60,
with respect to service under Article 12 that is subject to
this Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15) of this Section) and has at least 10 years
of service credit and is otherwise eligible under the
requirements of the applicable Article may elect to receive
the lower retirement annuity provided in subsection (d) of
this Section.
(c-5) A person who first becomes a member or a participant
subject to this Section on or after July 6, 2017 (the effective
date of Public Act 100-23), notwithstanding any other
provision of this Code to the contrary, is entitled to a
retirement annuity under Article 8 or Article 11 upon written
application if he or she has attained age 65 and has at least
10 years of service credit and is otherwise eligible under the
requirements of Article 8 or Article 11 of this Code,
whichever is applicable.
(d) The retirement annuity of a member or participant who
is retiring after attaining age 62 (age 60, with respect to
service under Article 12 that is subject to this Section, for a

HB4065 - 35 - LRB103 31966 RPS 60743 b
member or participant under Article 12 who first becomes a
member or participant under Article 12 on or after January 1,
2022 or who makes the election under item (i) of subsection
(d-15) of this Section) with at least 10 years of service
credit shall be reduced by one-half of 1% for each full month
that the member's age is under age 67 (age 65, with respect to
service under Article 12 that is subject to this Section, for a
member or participant under Article 12 who first becomes a
member or participant under Article 12 on or after January 1,
2022 or who makes the election under item (i) of subsection
(d-15) of this Section).
(d-5) The retirement annuity payable under Article 8 or
Article 11 to an eligible person subject to subsection (c-5)
of this Section who is retiring at age 60 with at least 10
years of service credit shall be reduced by one-half of 1% for
each full month that the member's age is under age 65.
(d-10) Each person who first became a member or
participant under Article 8 or Article 11 of this Code on or
after January 1, 2011 and prior to July 6, 2017 (the effective
date of Public Act 100-23) shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
provided in subsections (c-5) and (d-5) of this Section,
the eligibility for which is conditioned upon the member
or participant agreeing to the increases in employee
contributions for age and service annuities provided in

HB4065 - 36 - LRB103 31966 RPS 60743 b
subsection (a-5) of Section 8-174 of this Code (for
service under Article 8) or subsection (a-5) of Section
11-170 of this Code (for service under Article 11); or
(ii) to not agree to item (i) of this subsection
(d-10), in which case the member or participant shall
continue to be subject to the retirement age provisions in
subsections (c) and (d) of this Section and the employee
contributions for age and service annuity as provided in
subsection (a) of Section 8-174 of this Code (for service
under Article 8) or subsection (a) of Section 11-170 of
this Code (for service under Article 11).
The election provided for in this subsection shall be made
between October 1, 2017 and November 15, 2017. A person
subject to this subsection who makes the required election
shall remain bound by that election. A person subject to this
subsection who fails for any reason to make the required
election within the time specified in this subsection shall be
deemed to have made the election under item (ii).
(d-15) Each person who first becomes a member or
participant under Article 12 on or after January 1, 2011 and
prior to January 1, 2022 shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
specified in subsections (c) and (d) of this Section, the
eligibility for which is conditioned upon the member or
participant agreeing to the increase in employee

HB4065 - 37 - LRB103 31966 RPS 60743 b
contributions for service annuities specified in
subsection (b) of Section 12-150; or
(ii) to not agree to item (i) of this subsection
(d-15), in which case the member or participant shall not
be eligible for the reduced retirement age specified in
subsections (c) and (d) of this Section and shall not be
subject to the increase in employee contributions for
service annuities specified in subsection (b) of Section
12-150.
The election provided for in this subsection shall be made
between January 1, 2022 and April 1, 2022. A person subject to
this subsection who makes the required election shall remain
bound by that election. A person subject to this subsection
who fails for any reason to make the required election within
the time specified in this subsection shall be deemed to have
made the election under item (ii).
(e) Any retirement annuity or supplemental annuity shall
be subject to annual increases on the January 1 occurring
either on or after the attainment of age 67 (age 65, with
respect to service under Article 12 that is subject to this
Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15); and beginning on July 6, 2017 (the
effective date of Public Act 100-23), age 65 with respect to
service under Article 8 or Article 11 for eligible persons

HB4065 - 38 - LRB103 31966 RPS 60743 b
who: (i) are subject to subsection (c-5) of this Section; or
(ii) made the election under item (i) of subsection (d-10) of
this Section) or the first anniversary of the annuity start
date, whichever is later. Each annual increase shall be
calculated at 3% or one-half the annual unadjusted percentage
increase (but not less than zero) in the consumer price
index-u for the 12 months ending with the September preceding
each November 1, whichever is less, of the originally granted
retirement annuity. If the annual unadjusted percentage change
in the consumer price index-u for the 12 months ending with the
September preceding each November 1 is zero or there is a
decrease, then the annuity shall not be increased.
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 102-263 are
applicable without regard to whether the employee was in
active service on or after August 6, 2021 (the effective date
of Public Act 102-263).
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 100-23 are
applicable without regard to whether the employee was in
active service on or after July 6, 2017 (the effective date of
Public Act 100-23).
(f) The initial survivor's or widow's annuity of an
otherwise eligible survivor or widow of a retired member or
participant who first became a member or participant on or
after January 1, 2011 shall be in the amount of 66 2/3% of the

HB4065 - 39 - LRB103 31966 RPS 60743 b
retired member's or participant's retirement annuity at the
date of death. In the case of the death of a member or
participant who has not retired and who first became a member
or participant on or after January 1, 2011, eligibility for a
survivor's or widow's annuity shall be determined by the
applicable Article of this Code. The initial benefit shall be
66 2/3% of the earned annuity without a reduction due to age. A
child's annuity of an otherwise eligible child shall be in the
amount prescribed under each Article if applicable. Any
survivor's or widow's annuity shall be increased (1) on each
January 1 occurring on or after the commencement of the
annuity if the deceased member died while receiving a
retirement annuity or (2) in other cases, on each January 1
occurring after the first anniversary of the commencement of
the annuity. Each annual increase shall be calculated at 3% or
one-half the annual unadjusted percentage increase (but not
less than zero) in the consumer price index-u for the 12 months
ending with the September preceding each November 1, whichever
is less, of the originally granted survivor's annuity. If the
annual unadjusted percentage change in the consumer price
index-u for the 12 months ending with the September preceding
each November 1 is zero or there is a decrease, then the
annuity shall not be increased.
(g) This Section does not apply to a person who The
benefits in Section 14-110 apply only if the person is a State
policeman, a fire fighter in the fire protection service of a

HB4065 - 40 - LRB103 31966 RPS 60743 b
department, a conservation police officer, an investigator for
the Secretary of State, an investigator for the Office of the
Attorney General, an arson investigator, a Commerce Commission
police officer, investigator for the Department of Revenue or
the Illinois Gaming Board, a security employee of the
Department of Corrections or the Department of Juvenile
Justice, or a security employee of the Department of
Innovation and Technology, as those terms are defined in
subsection (b) and subsection (c) of Section 14-110. A person
who meets the requirements of this Section is entitled to an
annuity calculated under the provisions of Section 14-110, in
lieu of the regular or minimum retirement annuity, only if the
person has withdrawn from service with not less than 20 years
of eligible creditable service and has attained age 60,
regardless of whether the attainment of age 60 occurs while
the person is still in service.
(h) If a person who first becomes a member or a participant
of a retirement system or pension fund subject to this Section
on or after January 1, 2011 is receiving a retirement annuity
or retirement pension under that system or fund and becomes a
member or participant under any other system or fund created
by this Code and is employed on a full-time basis, except for
those members or participants exempted from the provisions of
this Section under subsection (a) of this Section, then the
person's retirement annuity or retirement pension under that
system or fund shall be suspended during that employment. Upon

HB4065 - 41 - LRB103 31966 RPS 60743 b
termination of that employment, the person's retirement
annuity or retirement pension payments shall resume and be
recalculated if recalculation is provided for under the
applicable Article of this Code.
If a person who first becomes a member of a retirement
system or pension fund subject to this Section on or after
January 1, 2012 and is receiving a retirement annuity or
retirement pension under that system or fund and accepts on a
contractual basis a position to provide services to a
governmental entity from which he or she has retired, then
that person's annuity or retirement pension earned as an
active employee of the employer shall be suspended during that
contractual service. A person receiving an annuity or
retirement pension under this Code shall notify the pension
fund or retirement system from which he or she is receiving an
annuity or retirement pension, as well as his or her
contractual employer, of his or her retirement status before
accepting contractual employment. A person who fails to submit
such notification shall be guilty of a Class A misdemeanor and
required to pay a fine of $1,000. Upon termination of that
contractual employment, the person's retirement annuity or
retirement pension payments shall resume and, if appropriate,
be recalculated under the applicable provisions of this Code.
(i) (Blank).
(i-5) It is the intent of this amendatory Act of the 103rd
General Assembly to provide to the participants specified in

HB4065 - 42 - LRB103 31966 RPS 60743 b
subsections (g) and (g-5) who first became participants on or
after January 1, 2011 the same level of benefits and
eligibility criteria for benefits as those who first became
participants before January 1, 2011. The changes made to this
Article by this amendatory Act of the 103rd General Assembly
that provide benefit increases for participants specified in
subsections (g) and (g-5) apply without regard to whether the
participant was in service on or after the effective date of
this amendatory Act of the 103rd General Assembly,
notwithstanding the provisions of Section 1-103.1. The benefit
increases are intended to apply prospectively and do not
entitle a participant to retroactive benefit payments or
increases. The changes made to this Article by this amendatory
Act of the 103rd General Assembly shall not cause or otherwise
result in any retroactive adjustment of any employee
contributions.
(j) In the case of a conflict between the provisions of
this Section and any other provision of this Code, the
provisions of this Section shall control.
(Source: P.A. 101-610, eff. 1-1-20; 102-16, eff. 6-17-21;
102-210, eff. 1-1-22; 102-263, eff. 8-6-21; 102-956, eff.
5-27-22.)
(40 ILCS 5/3-111) (from Ch. 108 1/2, par. 3-111)
Sec. 3-111. Pension.
(a) A police officer age 50 or more with 20 or more years

HB4065 - 43 - LRB103 31966 RPS 60743 b
of creditable service, who is not a participant in the
self-managed plan under Section 3-109.3 and who is no longer
in service as a police officer, shall receive a pension of 1/2
of the salary attached to the rank held by the officer on the
police force for one year immediately prior to retirement or,
beginning July 1, 1987 for persons terminating service on or
after that date, the salary attached to the rank held on the
last day of service or for one year prior to the last day,
whichever is greater. The pension shall be increased by 2.5%
of such salary for each additional year of service over 20
years of service through 30 years of service, to a maximum of
75% of such salary.
The changes made to this subsection (a) by this amendatory
Act of the 91st General Assembly apply to all pensions that
become payable under this subsection on or after January 1,
1999. All pensions payable under this subsection that began on
or after January 1, 1999 and before the effective date of this
amendatory Act shall be recalculated, and the amount of the
increase accruing for that period shall be payable to the
pensioner in a lump sum.
(a-5) No pension in effect on or granted after June 30,
1973 shall be less than $200 per month. Beginning July 1, 1987,
the minimum retirement pension for a police officer having at
least 20 years of creditable service shall be $400 per month,
without regard to whether or not retirement occurred prior to
that date. If the minimum pension established in Section

HB4065 - 44 - LRB103 31966 RPS 60743 b
3-113.1 is greater than the minimum provided in this
subsection, the Section 3-113.1 minimum controls.
(b) A police officer mandatorily retired from service due
to age by operation of law, having at least 8 but less than 20
years of creditable service, shall receive a pension equal to
2 1/2% of the salary attached to the rank he or she held on the
police force for one year immediately prior to retirement or,
beginning July 1, 1987 for persons terminating service on or
after that date, the salary attached to the rank held on the
last day of service or for one year prior to the last day,
whichever is greater, for each year of creditable service.
A police officer who retires or is separated from service
having at least 8 years but less than 20 years of creditable
service, who is not mandatorily retired due to age by
operation of law, and who does not apply for a refund of
contributions at his or her last separation from police
service, shall receive a pension upon attaining age 60 equal
to 2.5% of the salary attached to the rank held by the police
officer on the police force for one year immediately prior to
retirement or, beginning July 1, 1987 for persons terminating
service on or after that date, the salary attached to the rank
held on the last day of service or for one year prior to the
last day, whichever is greater, for each year of creditable
service.
(c) A police officer no longer in service who has at least
one but less than 8 years of creditable service in a police

HB4065 - 45 - LRB103 31966 RPS 60743 b
pension fund but meets the requirements of this subsection (c)
shall be eligible to receive a pension from that fund equal to
2.5% of the salary attached to the rank held on the last day of
service under that fund or for one year prior to that last day,
whichever is greater, for each year of creditable service in
that fund. The pension shall begin no earlier than upon
attainment of age 60 (or upon mandatory retirement from the
fund by operation of law due to age, if that occurs before age
60) and in no event before the effective date of this
amendatory Act of 1997.
In order to be eligible for a pension under this
subsection (c), the police officer must have at least 8 years
of creditable service in a second police pension fund under
this Article and be receiving a pension under subsection (a)
or (b) of this Section from that second fund. The police
officer need not be in service on or after the effective date
of this amendatory Act of 1997.
(d) (Blank). Notwithstanding any other provision of this
Article, the provisions of this subsection (d) apply to a
person who is not a participant in the self-managed plan under
Section 3-109.3 and who first becomes a police officer under
this Article on or after January 1, 2011.
A police officer age 55 or more who has 10 or more years of
service in that capacity shall be entitled at his option to
receive a monthly pension for his service as a police officer
computed by multiplying 2.5% for each year of such service by

HB4065 - 46 - LRB103 31966 RPS 60743 b
his or her final average salary.
The pension of a police officer who is retiring after
attaining age 50 with 10 or more years of creditable service
shall be reduced by one-half of 1% for each month that the
police officer's age is under age 55.
The maximum pension under this subsection (d) shall be 75%
of final average salary.
For the purposes of this subsection (d), "final average
salary" means the greater of: (i) the average monthly salary
obtained by dividing the total salary of the police officer
during the 48 consecutive months of service within the last 60
months of service in which the total salary was the highest by
the number of months of service in that period; or (ii) the
average monthly salary obtained by dividing the total salary
of the police officer during the 96 consecutive months of
service within the last 120 months of service in which the
total salary was the highest by the number of months of service
in that period.
Beginning on January 1, 2011, for all purposes under this
Code (including without limitation the calculation of benefits
and employee contributions), the annual salary based on the
plan year of a member or participant to whom this Section
applies shall not exceed $106,800; however, that amount shall
annually thereafter be increased by the lesser of (i) 3% of
that amount, including all previous adjustments, or (ii) the
annual unadjusted percentage increase (but not less than zero)

HB4065 - 47 - LRB103 31966 RPS 60743 b
in the consumer price index-u for the 12 months ending with the
September preceding each November 1, including all previous
adjustments.
Nothing in this amendatory Act of the 101st General
Assembly shall cause or otherwise result in any retroactive
adjustment of any employee contributions.
(Source: P.A. 101-610, eff. 1-1-20.)
(40 ILCS 5/3-111.1) (from Ch. 108 1/2, par. 3-111.1)
Sec. 3-111.1. Increase in pension.
(a) Except as provided in subsection (e), the monthly
pension of a police officer who retires after July 1, 1971, and
prior to January 1, 1986, shall be increased, upon either the
first of the month following the first anniversary of the date
of retirement if the officer is 60 years of age or over at
retirement date, or upon the first day of the month following
attainment of age 60 if it occurs after the first anniversary
of retirement, by 3% of the originally granted pension and by
an additional 3% of the originally granted pension in January
of each year thereafter.
(b) The monthly pension of a police officer who retired
from service with 20 or more years of service, on or before
July 1, 1971, shall be increased in January of the year
following the year of attaining age 65 or in January of 1972,
if then over age 65, by 3% of the originally granted pension
for each year the police officer received pension payments. In

HB4065 - 48 - LRB103 31966 RPS 60743 b
each January thereafter, he or she shall receive an additional
increase of 3% of the original pension.
(c) The monthly pension of a police officer who retires on
disability or is retired for disability shall be increased in
January of the year following the year of attaining age 60, by
3% of the original grant of pension for each year he or she
received pension payments. In each January thereafter, the
police officer shall receive an additional increase of 3% of
the original pension.
(d) The monthly pension of a police officer who retires
after January 1, 1986, shall be increased, upon either the
first of the month following the first anniversary of the date
of retirement if the officer is 55 years of age or over, or
upon the first day of the month following attainment of age 55
if it occurs after the first anniversary of retirement, by
1/12 of 3% of the originally granted pension for each full
month that has elapsed since the pension began, and by an
additional 3% of the originally granted pension in January of
each year thereafter.
The changes made to this subsection (d) by this amendatory
Act of the 91st General Assembly apply to all initial
increases that become payable under this subsection on or
after January 1, 1999. All initial increases that became
payable under this subsection on or after January 1, 1999 and
before the effective date of this amendatory Act shall be
recalculated and the additional amount accruing for that

HB4065 - 49 - LRB103 31966 RPS 60743 b
period, if any, shall be payable to the pensioner in a lump
sum.
(e) Notwithstanding the provisions of subsection (a), upon
the first day of the month following (1) the first anniversary
of the date of retirement, or (2) the attainment of age 55, or
(3) July 1, 1987, whichever occurs latest, the monthly pension
of a police officer who retired on or after January 1, 1977 and
on or before January 1, 1986, and did not receive an increase
under subsection (a) before July 1, 1987, shall be increased
by 3% of the originally granted monthly pension for each full
year that has elapsed since the pension began, and by an
additional 3% of the originally granted pension in each
January thereafter. The increases provided under this
subsection are in lieu of the increases provided in subsection
(a).
(f) Notwithstanding the other provisions of this Section,
beginning with increases granted on or after July 1, 1993, the
second and all subsequent automatic annual increases granted
under subsection (a), (b), (d), or (e) of this Section shall be
calculated as 3% of the amount of pension payable at the time
of the increase, including any increases previously granted
under this Section, rather than 3% of the originally granted
pension amount. Section 1-103.1 does not apply to this
subsection (f).
(g) Notwithstanding any other provision of this Article,
the monthly pension of a person who first becomes a police

HB4065 - 50 - LRB103 31966 RPS 60743 b
officer under this Article on or after January 1, 2011 shall be
increased on the January 1 occurring either on or after the
attainment of age 60 or the first anniversary of the pension
start date, whichever is later; except that, beginning on the
effective date of this amendatory Act of the 103rd General
Assembly, eligibility for and the amount of the automatic
increase in the monthly pension of such a person shall be
calculated as otherwise provided in this Section. Each annual
increase shall be calculated at 3% or one-half the annual
unadjusted percentage increase (but not less than zero) in the
consumer price index-u for the 12 months ending with the
September preceding each November 1, whichever is less, of the
originally granted pension. If the annual unadjusted
percentage change in the consumer price index-u for a 12-month
period ending in September is zero or, when compared with the
preceding period, decreases, then the pension shall not be
increased.
For the purposes of this subsection (g), "consumer price
index-u" means the index published by the Bureau of Labor
Statistics of the United States Department of Labor that
measures the average change in prices of goods and services
purchased by all urban consumers, United States city average,
all items, 1982-84 = 100. The new amount resulting from each
annual adjustment shall be determined by the Public Pension
Division of the Department of Insurance and made available to
the boards of the pension funds.

HB4065 - 51 - LRB103 31966 RPS 60743 b
(Source: P.A. 96-1495, eff. 1-1-11.)
(40 ILCS 5/3-112) (from Ch. 108 1/2, par. 3-112)
Sec. 3-112. Pension to survivors.
(a) Upon the death of a police officer entitled to a
pension under Section 3-111, the surviving spouse shall be
entitled to the pension to which the police officer was then
entitled. Upon the death of the surviving spouse, or upon the
remarriage of the surviving spouse if that remarriage
terminates the surviving spouse's eligibility under Section
3-121, the police officer's unmarried children who are under
age 18 or who are dependent because of physical or mental
disability shall be entitled to equal shares of such pension.
If there is no eligible surviving spouse and no eligible
child, the dependent parent or parents of the officer shall be
entitled to receive or share such pension until their death or
marriage or remarriage after the death of the police officer.
Notwithstanding any other provision of this Article, for a
person who first becomes a police officer under this Article
on or after January 1, 2011, the pension to which the surviving
spouse, children, or parents are entitled under this
subsection (a) shall be in an amount equal to the greater of
(i) 54% of the police officer's monthly salary at the date of
death, or (ii) 66 2/3% of the police officer's earned pension
at the date of death, and, if there is a surviving spouse, 12%
of such monthly salary shall be granted to the guardian of any

HB4065 - 52 - LRB103 31966 RPS 60743 b
minor child or children, including a child who has been
conceived but not yet born, for each such child until
attainment of age 18. Upon the death of the surviving spouse
leaving one or more minor children, or upon the death of a
police officer leaving one or more minor children but no
surviving spouse, a monthly pension of 20% of the monthly
salary shall be granted to the duly appointed guardian of each
such child for the support and maintenance of each such child
until the child reaches age 18. The total pension provided
under this paragraph shall not exceed 75% of the monthly
salary of the deceased police officer (1) when paid to the
survivor of a police officer who has attained 20 or more years
of service credit and who receives or is eligible to receive a
retirement pension under this Article, (2) when paid to the
survivor of a police officer who dies as a result of illness or
accident, (3) when paid to the survivor of a police officer who
dies from any cause while in receipt of a disability pension
under this Article, or (4) when paid to the survivor of a
deferred pensioner. Nothing in this subsection (a) shall act
to diminish the survivor's benefits described in subsection
(e) of this Section.
Notwithstanding Section 1-103.1, the changes made to this
subsection apply without regard to whether the deceased police
officer was in service on or after the effective date of this
amendatory Act of the 101st General Assembly.
Notwithstanding any other provision of this Article, the

HB4065 - 53 - LRB103 31966 RPS 60743 b
monthly pension of a survivor of a person who first becomes a
police officer under this Article on or after January 1, 2011
shall be increased on the January 1 after attainment of age 60
by the recipient of the survivor's pension and each January 1
thereafter by 3% or one-half the annual unadjusted percentage
increase (but not less than zero) in the consumer price
index-u for the 12 months ending with the September preceding
each November 1, whichever is less, of the originally granted
survivor's pension; except that, beginning on the effective
date of this amendatory Act of the 103rd General Assembly,
eligibility for and the amount of the automatic increase in
the monthly pension of such a survivor shall be calculated as
otherwise provided in this Section. If the annual unadjusted
percentage change in the consumer price index-u for a 12-month
period ending in September is zero or, when compared with the
preceding period, decreases, then the survivor's pension shall
not be increased.
For the purposes of this subsection (a), "consumer price
index-u" means the index published by the Bureau of Labor
Statistics of the United States Department of Labor that
measures the average change in prices of goods and services
purchased by all urban consumers, United States city average,
all items, 1982-84 = 100. The new amount resulting from each
annual adjustment shall be determined by the Public Pension
Division of the Department of Insurance and made available to
the boards of the pension funds.

HB4065 - 54 - LRB103 31966 RPS 60743 b
(b) Upon the death of a police officer while in service,
having at least 20 years of creditable service, or upon the
death of a police officer who retired from service with at
least 20 years of creditable service, whether death occurs
before or after attainment of age 50, the pension earned by the
police officer as of the date of death as provided in Section
3-111 shall be paid to the survivors in the sequence provided
in subsection (a) of this Section.
(c) Upon the death of a police officer while in service,
having at least 10 but less than 20 years of service, a pension
of 1/2 of the salary attached to the rank or ranks held by the
officer for one year immediately prior to death shall be
payable to the survivors in the sequence provided in
subsection (a) of this Section. If death occurs as a result of
the performance of duty, the 10 year requirement shall not
apply and the pension to survivors shall be payable after any
period of service.
(d) Beginning July 1, 1987, a minimum pension of $400 per
month shall be paid to all surviving spouses, without regard
to the fact that the death of the police officer occurred prior
to that date. If the minimum pension established in Section
3-113.1 is greater than the minimum provided in this
subsection, the Section 3-113.1 minimum controls.
(e) The pension of the surviving spouse of a police
officer who dies (i) on or after January 1, 2001, (ii) without
having begun to receive either a retirement pension payable

HB4065 - 55 - LRB103 31966 RPS 60743 b
under Section 3-111 or a disability pension payable under
Section 3-114.1, 3-114.2, 3-114.3, or 3-114.6, and (iii) as a
result of sickness, accident, or injury incurred in or
resulting from the performance of an act of duty shall not be
less than 100% of the salary attached to the rank held by the
deceased police officer on the last day of service,
notwithstanding any provision in this Article to the contrary.
(Source: P.A. 101-610, eff. 1-1-20.)
(40 ILCS 5/3-125) (from Ch. 108 1/2, par. 3-125)
Sec. 3-125. Financing.
(a) The city council or the board of trustees of the
municipality shall annually levy a tax upon all the taxable
property of the municipality at the rate on the dollar which
will produce an amount which, when added to the deductions
from the salaries or wages of police officers, and revenues
available from other sources, including State contributions,
will equal a sum sufficient to meet the annual requirements of
the police pension fund. The annual requirements to be
provided by such tax levy are equal to (1) the normal cost of
the pension fund for the year involved, plus (2) an amount
sufficient to bring the total assets of the pension fund up to
90% of the total actuarial liabilities of the pension fund by
the end of municipal fiscal year 2040, as annually updated and
determined by an enrolled actuary employed by the Illinois
Department of Insurance or by an enrolled actuary retained by

HB4065 - 56 - LRB103 31966 RPS 60743 b
the pension fund or the municipality, minus (3) any
anticipated State contributions from the Local Government
Retirement Fund for the year involved. In making these
determinations, the required minimum employer contribution
shall be calculated each year as a level percentage of payroll
over the years remaining up to and including fiscal year 2040
and shall be determined under the projected unit credit
actuarial cost method. The tax shall be levied and collected
in the same manner as the general taxes of the municipality,
and in addition to all other taxes now or hereafter authorized
to be levied upon all property within the municipality, and
shall be in addition to the amount authorized to be levied for
general purposes as provided by Section 8-3-1 of the Illinois
Municipal Code, approved May 29, 1961, as amended. The tax
shall be forwarded directly to the treasurer of the board
within 30 business days after receipt by the county.
(a-5) Beginning in State fiscal year 2024, the city
council or the board of trustees of the municipality shall
certify to the Governor the amount of (1) the normal cost of
the pension fund for the year involved, plus (2) an amount
sufficient to bring the total assets of the pension fund up to
90% of the total actuarial liabilities of the pension fund by
the end of municipal fiscal year 2040, as annually updated and
determined by an enrolled actuary employed by the Department
of Insurance or by an enrolled actuary retained by the pension
fund or the municipality.

HB4065 - 57 - LRB103 31966 RPS 60743 b
(b) For purposes of determining the required employer
contribution to a pension fund, the value of the pension
fund's assets shall be equal to the actuarial value of the
pension fund's assets, which shall be calculated as follows:
(1) On March 30, 2011, the actuarial value of a
pension fund's assets shall be equal to the market value
of the assets as of that date.
(2) In determining the actuarial value of the System's
assets for fiscal years after March 30, 2011, any
actuarial gains or losses from investment return incurred
in a fiscal year shall be recognized in equal annual
amounts over the 5-year period following that fiscal year.
(c) If a participating municipality fails to transmit to
the fund contributions required of it under this Article for
more than 90 days after the payment of those contributions is
due, the fund may, after giving notice to the municipality,
certify to the State Comptroller the amounts of the delinquent
payments in accordance with any applicable rules of the
Comptroller, and the Comptroller must, beginning in fiscal
year 2016, deduct and remit to the fund the certified amounts
or a portion of those amounts from the following proportions
of payments of State funds to the municipality:
(1) in fiscal year 2016, one-third of the total amount
of any payments of State funds to the municipality;
(2) in fiscal year 2017, two-thirds of the total
amount of any payments of State funds to the municipality;

HB4065 - 58 - LRB103 31966 RPS 60743 b
and
(3) in fiscal year 2018 and each fiscal year
thereafter, the total amount of any payments of State
funds to the municipality.
The State Comptroller may not deduct from any payments of
State funds to the municipality more than the amount of
delinquent payments certified to the State Comptroller by the
fund.
(d) The police pension fund shall consist of the following
moneys which shall be set apart by the treasurer of the
municipality:
(1) All moneys derived from the taxes levied
hereunder;
(2) Contributions by police officers under Section
3-125.1;
(2.5) All moneys received from the Police Officers'
Pension Investment Fund as provided in Article 22B of this
Code;
(3) All moneys accumulated by the municipality under
any previous legislation establishing a fund for the
benefit of disabled or retired police officers;
(4) Donations, gifts or other transfers authorized by
this Article.
(e) The Commission on Government Forecasting and
Accountability shall conduct a study of all funds established
under this Article and shall report its findings to the

HB4065 - 59 - LRB103 31966 RPS 60743 b
General Assembly on or before January 1, 2013. To the fullest
extent possible, the study shall include, but not be limited
to, the following:
(1) fund balances;
(2) historical employer contribution rates for each
fund;
(3) the actuarial formulas used as a basis for
employer contributions, including the actual assumed rate
of return for each year, for each fund;
(4) available contribution funding sources;
(5) the impact of any revenue limitations caused by
PTELL and employer home rule or non-home rule status; and
(6) existing statutory funding compliance procedures
and funding enforcement mechanisms for all municipal
pension funds.
(Source: P.A. 101-610, eff. 1-1-20.)
(40 ILCS 5/3-148.5 new)
Sec. 3-148.5. Application of this amendatory Act of the
103rd General Assembly. It is the intent of this amendatory
Act of the 103rd General Assembly to provide to police
officers who first became police officers on or after January
1, 2011 the same level of benefits and eligibility criteria
for benefits as those who first became police officers before
January 1, 2011. The changes made to this Article by this
amendatory Act of the 103rd General Assembly that provide

HB4065 - 60 - LRB103 31966 RPS 60743 b
benefit increases for police officers apply without regard to
whether the police officer was in service on or after the
effective date of this amendatory Act of the 103rd General
Assembly, notwithstanding the provisions of Section 1-103.1.
The benefit increases are intended to apply prospectively and
do not entitle a police officer to retroactive benefit
payments or increases. The changes made to this Article by
this amendatory Act of the 103rd General Assembly shall not
cause or otherwise result in any retroactive adjustment of any
employee contributions.
(40 ILCS 5/4-109) (from Ch. 108 1/2, par. 4-109)
Sec. 4-109. Pension.
(a) A firefighter age 50 or more with 20 or more years of
creditable service, who is no longer in service as a
firefighter, shall receive a monthly pension of 1/2 the
monthly salary attached to the rank held by him or her in the
fire service at the date of retirement.
The monthly pension shall be increased by 1/12 of 2.5% of
such monthly salary for each additional month over 20 years of
service through 30 years of service, to a maximum of 75% of
such monthly salary.
The changes made to this subsection (a) by this amendatory
Act of the 91st General Assembly apply to all pensions that
become payable under this subsection on or after January 1,
1999. All pensions payable under this subsection that began on

HB4065 - 61 - LRB103 31966 RPS 60743 b
or after January 1, 1999 and before the effective date of this
amendatory Act shall be recalculated, and the amount of the
increase accruing for that period shall be payable to the
pensioner in a lump sum.
(b) A firefighter who retires or is separated from service
having at least 10 but less than 20 years of creditable
service, who is not entitled to receive a disability pension,
and who did not apply for a refund of contributions at his or
her last separation from service shall receive a monthly
pension upon attainment of age 60 based on the monthly salary
attached to his or her rank in the fire service on the date of
retirement or separation from service according to the
following schedule:
For 10 years of service, 15% of salary;
For 11 years of service, 17.6% of salary;
For 12 years of service, 20.4% of salary;
For 13 years of service, 23.4% of salary;
For 14 years of service, 26.6% of salary;
For 15 years of service, 30% of salary;
For 16 years of service, 33.6% of salary;
For 17 years of service, 37.4% of salary;
For 18 years of service, 41.4% of salary;
For 19 years of service, 45.6% of salary.
(c) (Blank). Notwithstanding any other provision of this
Article, the provisions of this subsection (c) apply to a
person who first becomes a firefighter under this Article on

HB4065 - 62 - LRB103 31966 RPS 60743 b
or after January 1, 2011.
A firefighter age 55 or more who has 10 or more years of
service in that capacity shall be entitled at his option to
receive a monthly pension for his service as a firefighter
computed by multiplying 2.5% for each year of such service by
his or her final average salary.
The pension of a firefighter who is retiring after
attaining age 50 with 10 or more years of creditable service
shall be reduced by one-half of 1% for each month that the
firefighter's age is under age 55.
The maximum pension under this subsection (c) shall be 75%
of final average salary.
For the purposes of this subsection (c), "final average
salary" means the greater of: (i) the average monthly salary
obtained by dividing the total salary of the firefighter
during the 48 consecutive months of service within the last 60
months of service in which the total salary was the highest by
the number of months of service in that period; or (ii) the
average monthly salary obtained by dividing the total salary
of the firefighter during the 96 consecutive months of service
within the last 120 months of service in which the total salary
was the highest by the number of months of service in that
period.
Beginning on January 1, 2011, for all purposes under this
Code (including without limitation the calculation of benefits
and employee contributions), the annual salary based on the

HB4065 - 63 - LRB103 31966 RPS 60743 b
plan year of a member or participant to whom this Section
applies shall not exceed $106,800; however, that amount shall
annually thereafter be increased by the lesser of (i) 3% of
that amount, including all previous adjustments, or (ii) the
annual unadjusted percentage increase (but not less than zero)
in the consumer price index-u for the 12 months ending with the
September preceding each November 1, including all previous
adjustments.
Nothing in this amendatory Act of the 101st General
Assembly shall cause or otherwise result in any retroactive
adjustment of any employee contributions.
(Source: P.A. 101-610, eff. 1-1-20.)
(40 ILCS 5/4-109.1) (from Ch. 108 1/2, par. 4-109.1)
Sec. 4-109.1. Increase in pension.
(a) Except as provided in subsection (e), the monthly
pension of a firefighter who retires after July 1, 1971 and
prior to January 1, 1986, shall, upon either the first of the
month following the first anniversary of the date of
retirement if 60 years of age or over at retirement date, or
upon the first day of the month following attainment of age 60
if it occurs after the first anniversary of retirement, be
increased by 2% of the originally granted monthly pension and
by an additional 2% in each January thereafter. Effective
January 1976, the rate of the annual increase shall be 3% of
the originally granted monthly pension.

HB4065 - 64 - LRB103 31966 RPS 60743 b
(b) The monthly pension of a firefighter who retired from
service with 20 or more years of service, on or before July 1,
1971, shall be increased, in January of the year following the
year of attaining age 65 or in January 1972, if then over age
65, by 2% of the originally granted monthly pension, for each
year the firefighter received pension payments. In each
January thereafter, he or she shall receive an additional
increase of 2% of the original monthly pension. Effective
January 1976, the rate of the annual increase shall be 3%.
(c) The monthly pension of a firefighter who is receiving
a disability pension under this Article shall be increased, in
January of the year following the year the firefighter attains
age 60, or in January 1974, if then over age 60, by 2% of the
originally granted monthly pension for each year he or she
received pension payments. In each January thereafter, the
firefighter shall receive an additional increase of 2% of the
original monthly pension. Effective January 1976, the rate of
the annual increase shall be 3%.
(c-1) On January 1, 1998, every child's disability benefit
payable on that date under Section 4-110 or 4-110.1 shall be
increased by an amount equal to 1/12 of 3% of the amount of the
benefit, multiplied by the number of months for which the
benefit has been payable. On each January 1 thereafter, every
child's disability benefit payable under Section 4-110 or
4-110.1 shall be increased by 3% of the amount of the benefit
then being paid, including any previous increases received

HB4065 - 65 - LRB103 31966 RPS 60743 b
under this Article. These increases are not subject to any
limitation on the maximum benefit amount included in Section
4-110 or 4-110.1.
(c-2) On July 1, 2004, every pension payable to or on
behalf of a minor or disabled surviving child that is payable
on that date under Section 4-114 shall be increased by an
amount equal to 1/12 of 3% of the amount of the pension,
multiplied by the number of months for which the benefit has
been payable. On July 1, 2005, July 1, 2006, July 1, 2007, and
July 1, 2008, every pension payable to or on behalf of a minor
or disabled surviving child that is payable under Section
4-114 shall be increased by 3% of the amount of the pension
then being paid, including any previous increases received
under this Article. These increases are not subject to any
limitation on the maximum benefit amount included in Section
4-114.
(d) The monthly pension of a firefighter who retires after
January 1, 1986, shall, upon either the first of the month
following the first anniversary of the date of retirement if
55 years of age or over, or upon the first day of the month
following attainment of age 55 if it occurs after the first
anniversary of retirement, be increased by 1/12 of 3% of the
originally granted monthly pension for each full month that
has elapsed since the pension began, and by an additional 3% in
each January thereafter.
The changes made to this subsection (d) by this amendatory

HB4065 - 66 - LRB103 31966 RPS 60743 b
Act of the 91st General Assembly apply to all initial
increases that become payable under this subsection on or
after January 1, 1999. All initial increases that became
payable under this subsection on or after January 1, 1999 and
before the effective date of this amendatory Act shall be
recalculated and the additional amount accruing for that
period, if any, shall be payable to the pensioner in a lump
sum.
(e) Notwithstanding the provisions of subsection (a), upon
the first day of the month following (1) the first anniversary
of the date of retirement, or (2) the attainment of age 55, or
(3) July 1, 1987, whichever occurs latest, the monthly pension
of a firefighter who retired on or after January 1, 1977 and on
or before January 1, 1986 and did not receive an increase under
subsection (a) before July 1, 1987, shall be increased by 3% of
the originally granted monthly pension for each full year that
has elapsed since the pension began, and by an additional 3% in
each January thereafter. The increases provided under this
subsection are in lieu of the increases provided in subsection
(a).
(f) In July 2009, the monthly pension of a firefighter who
retired before July 1, 1977 shall be recalculated and
increased to reflect the amount that the firefighter would
have received in July 2009 had the firefighter been receiving
a 3% compounded increase for each year he or she received
pension payments after January 1, 1986, plus any increases in

HB4065 - 67 - LRB103 31966 RPS 60743 b
pension received for each year prior to January 1, 1986. In
each January thereafter, he or she shall receive an additional
increase of 3% of the amount of the pension then being paid.
The changes made to this Section by this amendatory Act of the
96th General Assembly apply without regard to whether the
firefighter was in service on or after its effective date.
(g) Notwithstanding any other provision of this Article,
the monthly pension of a person who first becomes a
firefighter under this Article on or after January 1, 2011
shall be increased on the January 1 occurring either on or
after the attainment of age 60 or the first anniversary of the
pension start date, whichever is later; except that, beginning
on the effective date of this amendatory Act of the 103rd
General Assembly, eligibility for and the amount of the
automatic increase in the monthly pension of such a person
shall be calculated as otherwise provided in this Section.
Each annual increase shall be calculated at 3% or one-half the
annual unadjusted percentage increase (but not less than zero)
in the consumer price index-u for the 12 months ending with the
September preceding each November 1, whichever is less, of the
originally granted pension. If the annual unadjusted
percentage change in the consumer price index-u for a 12-month
period ending in September is zero or, when compared with the
preceding period, decreases, then the pension shall not be
increased.
For the purposes of this subsection (g), "consumer price

HB4065 - 68 - LRB103 31966 RPS 60743 b
index-u" means the index published by the Bureau of Labor
Statistics of the United States Department of Labor that
measures the average change in prices of goods and services
purchased by all urban consumers, United States city average,
all items, 1982-84 = 100. The new amount resulting from each
annual adjustment shall be determined by the Public Pension
Division of the Department of Insurance and made available to
the boards of the pension funds.
(Source: P.A. 96-775, eff. 8-28-09; 96-1495, eff. 1-1-11.)
(40 ILCS 5/4-114) (from Ch. 108 1/2, par. 4-114)
Sec. 4-114. Pension to survivors. If a firefighter who is
not receiving a disability pension under Section 4-110 or
4-110.1 dies (1) as a result of any illness or accident, or (2)
from any cause while in receipt of a disability pension under
this Article, or (3) during retirement after 20 years service,
or (4) while vested for or in receipt of a pension payable
under subsection (b) of Section 4-109, or (5) while a deferred
pensioner, having made all required contributions, a pension
shall be paid to his or her survivors, based on the monthly
salary attached to the firefighter's rank on the last day of
service in the fire department, as follows:
(a)(1) To the surviving spouse, a monthly pension of
40% of the monthly salary, and if there is a surviving
spouse, to the guardian of any minor child or children
including a child which has been conceived but not yet

HB4065 - 69 - LRB103 31966 RPS 60743 b
born, 12% of such monthly salary for each such child until
attainment of age 18 or until the child's marriage,
whichever occurs first. Beginning July 1, 1993, the
monthly pension to the surviving spouse shall be 54% of
the monthly salary for all persons receiving a surviving
spouse pension under this Article, regardless of whether
the deceased firefighter was in service on or after the
effective date of this amendatory Act of 1993.
(2) Beginning July 1, 2004, unless the amount provided
under paragraph (1) of this subsection (a) is greater, the
total monthly pension payable under this paragraph (a),
including any amount payable on account of children, to
the surviving spouse of a firefighter who died (i) while
receiving a retirement pension, (ii) while he or she was a
deferred pensioner with at least 20 years of creditable
service, or (iii) while he or she was in active service
having at least 20 years of creditable service, regardless
of age, shall be no less than 100% of the monthly
retirement pension earned by the deceased firefighter at
the time of death, regardless of whether death occurs
before or after attainment of age 50, including any
increases under Section 4-109.1. This minimum applies to
all such surviving spouses who are eligible to receive a
surviving spouse pension, regardless of whether the
deceased firefighter was in service on or after the
effective date of this amendatory Act of the 93rd General

HB4065 - 70 - LRB103 31966 RPS 60743 b
Assembly, and notwithstanding any limitation on maximum
pension under paragraph (d) or any other provision of this
Article.
(3) If the pension paid on and after July 1, 2004 to
the surviving spouse of a firefighter who died on or after
July 1, 2004 and before the effective date of this
amendatory Act of the 93rd General Assembly was less than
the minimum pension payable under paragraph (1) or (2) of
this subsection (a), the fund shall pay a lump sum equal to
the difference within 90 days after the effective date of
this amendatory Act of the 93rd General Assembly.
The pension to the surviving spouse shall terminate in
the event of the surviving spouse's remarriage prior to
July 1, 1993; remarriage on or after that date does not
affect the surviving spouse's pension, regardless of
whether the deceased firefighter was in service on or
after the effective date of this amendatory Act of 1993.
The surviving spouse's pension shall be subject to the
minimum established in Section 4-109.2.
(b) Upon the death of the surviving spouse leaving one
or more minor children, or upon the death of a firefighter
leaving one or more minor children but no surviving
spouse, to the duly appointed guardian of each such child,
for support and maintenance of each such child until the
child reaches age 18 or marries, whichever occurs first, a
monthly pension of 20% of the monthly salary.

HB4065 - 71 - LRB103 31966 RPS 60743 b
In a case where the deceased firefighter left one or
more minor children but no surviving spouse and the
guardian of a child is receiving a pension of 12% of the
monthly salary on August 16, 2013 (the effective date of
Public Act 98-391), the pension is increased by Public Act
98-391 to 20% of the monthly salary for each such child,
beginning on the pension payment date occurring on or next
following August 16, 2013. The changes to this Section
made by Public Act 98-391 apply without regard to whether
the deceased firefighter was in service on or after August
16, 2013.
(c) If a deceased firefighter leaves no surviving
spouse or unmarried minor children under age 18, but
leaves a dependent father or mother, to each dependent
parent a monthly pension of 18% of the monthly salary. To
qualify for the pension, a dependent parent must furnish
satisfactory proof that the deceased firefighter was at
the time of his or her death the sole supporter of the
parent or that the parent was the deceased's dependent for
federal income tax purposes.
(d) The total pension provided under paragraphs (a),
(b) and (c) of this Section shall not exceed 75% of the
monthly salary of the deceased firefighter (1) when paid
to the survivor of a firefighter who has attained 20 or
more years of service credit and who receives or is
eligible to receive a retirement pension under this

HB4065 - 72 - LRB103 31966 RPS 60743 b
Article, or (2) when paid to the survivor of a firefighter
who dies as a result of illness or accident, or (3) when
paid to the survivor of a firefighter who dies from any
cause while in receipt of a disability pension under this
Article, or (4) when paid to the survivor of a deferred
pensioner. For all other survivors of deceased
firefighters, the total pension provided under paragraphs
(a), (b) and (c) of this Section shall not exceed 50% of
the retirement annuity the firefighter would have received
on the date of death.
The maximum pension limitations in this paragraph (d)
do not control over any contrary provision of this Article
explicitly establishing a minimum amount of pension or
granting a one-time or annual increase in pension.
(e) If a firefighter leaves no eligible survivors
under paragraphs (a), (b) and (c), the board shall refund
to the firefighter's estate the amount of his or her
accumulated contributions, less the amount of pension
payments, if any, made to the firefighter while living.
(f) (Blank).
(g) If a judgment of dissolution of marriage between a
firefighter and spouse is judicially set aside subsequent
to the firefighter's death, the surviving spouse is
eligible for the pension provided in paragraph (a) only if
the judicial proceedings are filed within 2 years after
the date of the dissolution of marriage and within one

HB4065 - 73 - LRB103 31966 RPS 60743 b
year after the firefighter's death and the board is made a
party to the proceedings. In such case the pension shall
be payable only from the date of the court's order setting
aside the judgment of dissolution of marriage.
(h) Benefits payable on account of a child under this
Section shall not be reduced or terminated by reason of
the child's attainment of age 18 if he or she is then
dependent by reason of a physical or mental disability but
shall continue to be paid as long as such dependency
continues. Individuals over the age of 18 and adjudged as
a disabled person pursuant to Article XIa of the Probate
Act of 1975, except for persons receiving benefits under
Article III of the Illinois Public Aid Code, shall be
eligible to receive benefits under this Act.
(i) Beginning January 1, 2000, the pension of the
surviving spouse of a firefighter who dies on or after
January 1, 1994 as a result of sickness, accident, or
injury incurred in or resulting from the performance of an
act of duty or from the cumulative effects of acts of duty
shall not be less than 100% of the salary attached to the
rank held by the deceased firefighter on the last day of
service, notwithstanding subsection (d) or any other
provision of this Article.
(j) Beginning July 1, 2004, the pension of the
surviving spouse of a firefighter who dies on or after
January 1, 1988 as a result of sickness, accident, or

HB4065 - 74 - LRB103 31966 RPS 60743 b
injury incurred in or resulting from the performance of an
act of duty or from the cumulative effects of acts of duty
shall not be less than 100% of the salary attached to the
rank held by the deceased firefighter on the last day of
service, notwithstanding subsection (d) or any other
provision of this Article.
Notwithstanding any other provision of this Article, if a
person who first becomes a firefighter under this Article on
or after January 1, 2011 and who is not receiving a disability
pension under Section 4-110 or 4-110.1 dies (1) as a result of
any illness or accident, (2) from any cause while in receipt of
a disability pension under this Article, (3) during retirement
after 20 years service, (4) while vested for or in receipt of a
pension payable under subsection (b) of Section 4-109, or (5)
while a deferred pensioner, having made all required
contributions, then a pension shall be paid to his or her
survivors in an amount equal to the greater of (i) 54% of the
firefighter's monthly salary at the date of death, or (ii) 66
2/3% of the firefighter's earned pension at the date of death,
and, if there is a surviving spouse, 12% of such monthly salary
shall be granted to the guardian of any minor child or
children, including a child who has been conceived but not yet
born, for each such child until attainment of age 18. Upon the
death of the surviving spouse leaving one or more minor
children, or upon the death of a firefighter leaving one or
more minor children but no surviving spouse, a monthly pension

HB4065 - 75 - LRB103 31966 RPS 60743 b
of 20% of the monthly salary shall be granted to the duly
appointed guardian of each such child for the support and
maintenance of each such child until the child reaches age 18.
The total pension provided under this paragraph shall not
exceed 75% of the monthly salary of the deceased firefighter
(1) when paid to the survivor of a firefighter who has attained
20 or more years of service credit and who receives or is
eligible to receive a retirement pension under this Article,
(2) when paid to the survivor of a firefighter who dies as a
result of illness or accident, (3) when paid to the survivor of
a firefighter who dies from any cause while in receipt of a
disability pension under this Article, or (4) when paid to the
survivor of a deferred pensioner. Nothing in this Section
shall act to diminish the survivor's benefits described in
subsection (j) of this Section.
Notwithstanding Section 1-103.1, the changes made to this
subsection apply without regard to whether the deceased
firefighter was in service on or after the effective date of
this amendatory Act of the 101st General Assembly.
Notwithstanding any other provision of this Article, the
monthly pension of a survivor of a person who first becomes a
firefighter under this Article on or after January 1, 2011
shall be increased on the January 1 after attainment of age 60
by the recipient of the survivor's pension and each January 1
thereafter by 3% or one-half the annual unadjusted percentage
increase in the consumer price index-u for the 12 months

HB4065 - 76 - LRB103 31966 RPS 60743 b
ending with the September preceding each November 1, whichever
is less, of the originally granted survivor's pension; except
that, beginning on the effective date of this amendatory Act
of the 103rd General Assembly, eligibility for and the amount
of the automatic increase in the monthly pension of such a
survivor shall be calculated as otherwise provided in this
Section. If the annual unadjusted percentage change in the
consumer price index-u for a 12-month period ending in
September is zero or, when compared with the preceding period,
decreases, then the survivor's pension shall not be increased.
For the purposes of this Section, "consumer price index-u"
means the index published by the Bureau of Labor Statistics of
the United States Department of Labor that measures the
average change in prices of goods and services purchased by
all urban consumers, United States city average, all items,
1982-84 = 100. The new amount resulting from each annual
adjustment shall be determined by the Public Pension Division
of the Department of Insurance and made available to the
boards of the pension funds.
(Source: P.A. 101-610, eff. 1-1-20.)
(40 ILCS 5/4-118) (from Ch. 108 1/2, par. 4-118)
Sec. 4-118. Financing.
(a) The city council or the board of trustees of the
municipality shall annually levy a tax upon all the taxable
property of the municipality at the rate on the dollar which

HB4065 - 77 - LRB103 31966 RPS 60743 b
will produce an amount which, when added to the deductions
from the salaries or wages of firefighters and revenues
available from other sources, will equal a sum sufficient to
meet the annual actuarial requirements of the pension fund, as
determined by an enrolled actuary employed by the Illinois
Department of Insurance or by an enrolled actuary retained by
the pension fund or municipality. For the purposes of this
Section, the annual actuarial requirements of the pension fund
are equal to (1) the normal cost of the pension fund, or 17.5%
of the salaries and wages to be paid to firefighters for the
year involved, whichever is greater, plus (2) an annual amount
sufficient to bring the total assets of the pension fund up to
90% of the total actuarial liabilities of the pension fund by
the end of municipal fiscal year 2040, as annually updated and
determined by an enrolled actuary employed by the Illinois
Department of Insurance or by an enrolled actuary retained by
the pension fund or the municipality, minus (3) any
anticipated State contributions from the Local Government
Retirement Fund for the year involved. In making these
determinations, the required minimum employer contribution
shall be calculated each year as a level percentage of payroll
over the years remaining up to and including fiscal year 2040
and shall be determined under the projected unit credit
actuarial cost method. The amount to be applied towards the
amortization of the unfunded accrued liability in any year
shall not be less than the annual amount required to amortize

HB4065 - 78 - LRB103 31966 RPS 60743 b
the unfunded accrued liability, including interest, as a level
percentage of payroll over the number of years remaining in
the 40-year amortization period.
(a-1) Beginning in State fiscal year 2024, the city
council or the board of trustees of the municipality shall
certify to the Governor the amount of (1) the normal cost of
the pension fund, or 17.5% of the salaries and wages to be paid
to firefighters for the year involved, whichever is greater,
plus (2) an annual amount sufficient to bring the total assets
of the pension fund up to 90% of the total actuarial
liabilities of the pension fund by the end of municipal fiscal
year 2040, as annually updated and determined by an enrolled
actuary employed by the Department of Insurance or by an
enrolled actuary retained by the pension fund or the
municipality.
(a-2) A municipality that has established a pension fund
under this Article and that employs a full-time firefighter,
as defined in Section 4-106, shall be deemed a primary
employer with respect to that full-time firefighter. Any
municipality of 5,000 or more inhabitants that employs or
enrolls a firefighter while that firefighter continues to earn
service credit as a participant in a primary employer's
pension fund under this Article shall be deemed a secondary
employer and such employees shall be deemed to be secondary
employee firefighters. To ensure that the primary employer's
pension fund under this Article is aware of additional

HB4065 - 79 - LRB103 31966 RPS 60743 b
liabilities and risks to which firefighters are exposed when
performing work as firefighters for secondary employers, a
secondary employer shall annually prepare a report accounting
for all hours worked by and wages and salaries paid to the
secondary employee firefighters it receives services from or
employs for each fiscal year in which such firefighters are
employed and transmit a certified copy of that report to the
primary employer's pension fund, the Department of Insurance,
and the secondary employee firefighter no later than 30 days
after the end of any fiscal year in which wages were paid to
the secondary employee firefighters.
Nothing in this Section shall be construed to allow a
secondary employee to qualify for benefits or creditable
service for employment as a firefighter for a secondary
employer.
(a-5) For purposes of determining the required employer
contribution to a pension fund, the value of the pension
fund's assets shall be equal to the actuarial value of the
pension fund's assets, which shall be calculated as follows:
(1) On March 30, 2011, the actuarial value of a
pension fund's assets shall be equal to the market value
of the assets as of that date.
(2) In determining the actuarial value of the pension
fund's assets for fiscal years after March 30, 2011, any
actuarial gains or losses from investment return incurred
in a fiscal year shall be recognized in equal annual

HB4065 - 80 - LRB103 31966 RPS 60743 b
amounts over the 5-year period following that fiscal year.
(b) The tax shall be levied and collected in the same
manner as the general taxes of the municipality, and shall be
in addition to all other taxes now or hereafter authorized to
be levied upon all property within the municipality, and in
addition to the amount authorized to be levied for general
purposes, under Section 8-3-1 of the Illinois Municipal Code
or under Section 14 of the Fire Protection District Act. The
tax shall be forwarded directly to the treasurer of the board
within 30 business days of receipt by the county (or, in the
case of amounts added to the tax levy under subsection (f),
used by the municipality to pay the employer contributions
required under subsection (b-1) of Section 15-155 of this
Code).
(b-5) If a participating municipality fails to transmit to
the fund contributions required of it under this Article for
more than 90 days after the payment of those contributions is
due, the fund may, after giving notice to the municipality,
certify to the State Comptroller the amounts of the delinquent
payments in accordance with any applicable rules of the
Comptroller, and the Comptroller must, beginning in fiscal
year 2016, deduct and remit to the fund the certified amounts
or a portion of those amounts from the following proportions
of payments of State funds to the municipality:
(1) in fiscal year 2016, one-third of the total amount
of any payments of State funds to the municipality;

HB4065 - 81 - LRB103 31966 RPS 60743 b
(2) in fiscal year 2017, two-thirds of the total
amount of any payments of State funds to the municipality;
and
(3) in fiscal year 2018 and each fiscal year
thereafter, the total amount of any payments of State
funds to the municipality.
The State Comptroller may not deduct from any payments of
State funds to the municipality more than the amount of
delinquent payments certified to the State Comptroller by the
fund.
(c) The board shall make available to the membership and
the general public for inspection and copying at reasonable
times the most recent Actuarial Valuation Balance Sheet and
Tax Levy Requirement issued to the fund by the Department of
Insurance.
(d) The firefighters' pension fund shall consist of the
following moneys which shall be set apart by the treasurer of
the municipality: (1) all moneys derived from the taxes levied
hereunder; (2) contributions by firefighters as provided under
Section 4-118.1; (2.5) all moneys received from the
Firefighters' Pension Investment Fund as provided in Article
22C of this Code; (3) all rewards in money, fees, gifts, and
emoluments that may be paid or given for or on account of
extraordinary service by the fire department or any member
thereof, except when allowed to be retained by competitive
awards; and (4) any money, real estate or personal property

HB4065 - 82 - LRB103 31966 RPS 60743 b
received by the board.
(e) For the purposes of this Section, "enrolled actuary"
means an actuary: (1) who is a member of the Society of
Actuaries or the American Academy of Actuaries; and (2) who is
enrolled under Subtitle C of Title III of the Employee
Retirement Income Security Act of 1974, or who has been
engaged in providing actuarial services to one or more public
retirement systems for a period of at least 3 years as of July
1, 1983.
(f) The corporate authorities of a municipality that
employs a person who is described in subdivision (d) of
Section 4-106 may add to the tax levy otherwise provided for in
this Section an amount equal to the projected cost of the
employer contributions required to be paid by the municipality
to the State Universities Retirement System under subsection
(b-1) of Section 15-155 of this Code.
(g) The Commission on Government Forecasting and
Accountability shall conduct a study of all funds established
under this Article and shall report its findings to the
General Assembly on or before January 1, 2013. To the fullest
extent possible, the study shall include, but not be limited
to, the following:
(1) fund balances;
(2) historical employer contribution rates for each
fund;
(3) the actuarial formulas used as a basis for

HB4065 - 83 - LRB103 31966 RPS 60743 b
employer contributions, including the actual assumed rate
of return for each year, for each fund;
(4) available contribution funding sources;
(5) the impact of any revenue limitations caused by
PTELL and employer home rule or non-home rule status; and
(6) existing statutory funding compliance procedures
and funding enforcement mechanisms for all municipal
pension funds.
(Source: P.A. 101-522, eff. 8-23-19; 101-610, eff. 1-1-20;
102-59, eff. 7-9-21; 102-558, eff. 8-20-21.)
(40 ILCS 5/4-138.15 new)
Sec. 4-138.15. Application of this amendatory Act of the
103rd General Assembly. It is the intent of this amendatory
Act of the 103rd General Assembly to provide to firefighters
who first became firefighters on or after January 1, 2011 the
same level of benefits and eligibility criteria for benefits
as those who first became firefighters before January 1, 2011.
The changes made to this Article by this amendatory Act of the
103rd General Assembly that provide benefit increases for
firefighters apply without regard to whether the firefighter
was in service on or after the effective date of this
amendatory Act of the 103rd General Assembly, notwithstanding
the provisions of Section 1-103.1. The benefit increases are
intended to apply prospectively and do not entitle a
firefighter to retroactive benefit payments or increases. The

HB4065 - 84 - LRB103 31966 RPS 60743 b
changes made to this Article by this amendatory Act of the
103rd General Assembly shall not cause or otherwise result in
any retroactive adjustment of any employee contributions.
(40 ILCS 5/5-155) (from Ch. 108 1/2, par. 5-155)
Sec. 5-155. Ordinary disability benefit. A policeman less
than age 63 who becomes disabled after the effective date as
the result of any cause other than injury incurred in the
performance of an act of duty, shall receive ordinary
disability benefit during any period or periods of disability
exceeding 30 days, for which he does not have a right to
receive any part of his salary. Payment of such benefit shall
not exceed, in the aggregate, throughout the total service of
the policeman, a period equal to one-fourth of the service
rendered to the city prior to the time he became disabled, nor
more than 5 years. In computing such period of service, the
time that the policeman received ordinary disability benefit
shall not be included.
When a disabled policeman becomes age 63 or would have
been retired by operation of law, whichever is later, the
disability benefit shall cease. The policeman, if still
disabled, shall thereafter receive such annuity as is provided
in accordance with other provisions of this Article.
Ordinary disability benefit shall be 50% of the
policeman's salary, as salary is defined in this Article
(including the limitation in Section 5-238 if applicable), at

HB4065 - 85 - LRB103 31966 RPS 60743 b
the time disability occurs. Until September 1, 1969, before
any payment, an amount equal to the sum ordinarily deducted
from the policeman's salary for all annuity purposes for the
period for which payment of ordinary disability benefit is
made shall be deducted from such payment and credited as a
deduction from salary for such period. Beginning September 1,
1969, the city shall also contribute all amounts ordinarily
contributed by it for annuity purposes for the policeman as if
he were in active discharge of his duties. Such sums so
credited shall be regarded, for annuity and refund purposes,
as sums contributed by the policeman.
(Source: P.A. 99-905, eff. 11-29-16.)
(40 ILCS 5/5-167.1) (from Ch. 108 1/2, par. 5-167.1)
Sec. 5-167.1. Automatic increase in annuity; retirement
from service after September 1, 1967.
(a) A policeman who retires from service after September
1, 1967 with at least 20 years of service credit shall, upon
either the first of the month following the first anniversary
of his date of retirement if he is age 60 (age 55 if born
before January 1, 1966) or over on that anniversary date, or
upon the first of the month following his attainment of age 60
(age 55 if born before January 1, 1966) if it occurs after the
first anniversary of his retirement date, have his then fixed
and payable monthly annuity increased by 1 1/2% and such first
fixed annuity as granted at retirement increased by an

HB4065 - 86 - LRB103 31966 RPS 60743 b
additional 1 1/2% in January of each year thereafter up to a
maximum increase of 30%. Beginning January 1, 1983 for
policemen born before January 1, 1930, and beginning January
1, 1988 for policemen born on or after January 1, 1930 but
before January 1, 1940, and beginning January 1, 1996 for
policemen born on or after January 1, 1940 but before January
1, 1945, and beginning January 1, 2000 for policemen born on or
after January 1, 1945 but before January 1, 1950, and
beginning January 1, 2005 for policemen born on or after
January 1, 1950 but before January 1, 1955, and beginning
January 1, 2017 for policemen born on or after January 1, 1955
but before January 1, 1966, such increases shall be 3% and such
policemen shall not be subject to the 30% maximum increase.
Any policeman born before January 1, 1945 who qualifies
for a minimum annuity and retires after September 1, 1967 but
has not received the initial increase under this subsection
before January 1, 1996 is entitled to receive the initial
increase under this subsection on (1) January 1, 1996, (2) the
first anniversary of the date of retirement, or (3) attainment
of age 55, whichever occurs last. The changes to this Section
made by Public Act 89-12 apply beginning January 1, 1996 and
without regard to whether the policeman or annuitant
terminated service before the effective date of that Act.
Any policeman born before January 1, 1950 who qualifies
for a minimum annuity and retires after September 1, 1967 but
has not received the initial increase under this subsection

HB4065 - 87 - LRB103 31966 RPS 60743 b
before January 1, 2000 is entitled to receive the initial
increase under this subsection on (1) January 1, 2000, (2) the
first anniversary of the date of retirement, or (3) attainment
of age 55, whichever occurs last. The changes to this Section
made by this amendatory Act of the 92nd General Assembly apply
without regard to whether the policeman or annuitant
terminated service before the effective date of this
amendatory Act.
Any policeman born before January 1, 1955 who qualifies
for a minimum annuity and retires after September 1, 1967 but
has not received the initial increase under this subsection
before January 1, 2005 is entitled to receive the initial
increase under this subsection on (1) January 1, 2005, (2) the
first anniversary of the date of retirement, or (3) attainment
of age 55, whichever occurs last. The changes to this Section
made by this amendatory Act of the 94th General Assembly apply
without regard to whether the policeman or annuitant
terminated service before the effective date of this
amendatory Act.
Any policeman born before January 1, 1966 who qualifies
for a minimum annuity and retires after September 1, 1967 but
has not received the initial increase under this subsection
before January 1, 2017 is entitled to receive an initial
increase under this subsection on (1) January 1, 2017, (2) the
first anniversary of the date of retirement, or (3) attainment
of age 55, whichever occurs last, in an amount equal to 3% for

HB4065 - 88 - LRB103 31966 RPS 60743 b
each complete year following the date of retirement or
attainment of age 55, whichever occurs later. The changes to
this subsection made by this amendatory Act of the 99th
General Assembly apply without regard to whether the policeman
or annuitant terminated service before the effective date of
this amendatory Act.
(b) Subsection (a) of this Section is not applicable to an
employee receiving a term annuity.
(c) To help defray the cost of such increases in annuity,
there shall be deducted, beginning September 1, 1967, from
each payment of salary to a policeman, 1/2 of 1% of each salary
payment concurrently with and in addition to the salary
deductions otherwise made for annuity purposes.
The city, in addition to the contributions otherwise made
by it for annuity purposes under other provisions of this
Article, shall make matching contributions concurrently with
such salary deductions.
Each such 1/2 of 1% deduction from salary and each such
contribution by the city of 1/2 of 1% of salary shall be
credited to the Automatic Increase Reserve, to be used to
defray the cost of the annuity increase provided by this
Section. Any balance in such reserve as of the beginning of
each calendar year shall be credited with interest at the rate
of 3% per annum.
Such deductions from salary and city contributions shall
continue while the policeman is in service.

HB4065 - 89 - LRB103 31966 RPS 60743 b
The salary deductions provided in this Section are not
subject to refund, except to the policeman himself, in any
case in which: (i) the policeman withdraws prior to
qualification for minimum annuity or Tier 2 monthly retirement
annuity and applies for refund, (ii) the policeman applies for
an annuity of a type that is not subject to annual increases
under this Section, or (iii) a term annuity becomes payable.
In such cases, the total of such salary deductions shall be
refunded to the policeman, without interest, and charged to
the Automatic Increase Reserve.
(d) Notwithstanding any other provision of this Article,
the Tier 2 monthly retirement annuity of a person who first
becomes a policeman under this Article on or after the
effective date of this amendatory Act of the 97th General
Assembly shall be increased on the January 1 occurring either
on or after (i) the attainment of age 60 or (ii) the first
anniversary of the annuity start date, whichever is later;
except that, beginning on the effective date of this
amendatory Act of the 103rd General Assembly, eligibility for
and the amount of the automatic increase in the monthly
pension of such a person shall be calculated as otherwise
provided in this Section. Each annual increase shall be
calculated at 3% or one-half the annual unadjusted percentage
increase (but not less than zero) in the consumer price
index-u for the 12 months ending with the September preceding
each November 1, whichever is less, of the originally granted

HB4065 - 90 - LRB103 31966 RPS 60743 b
retirement annuity. If the annual unadjusted percentage change
in the consumer price index-u for a 12-month period ending in
September is zero or, when compared with the preceding period,
decreases, then the annuity shall not be increased.
For the purposes of this subsection (d), "consumer price
index-u" means the index published by the Bureau of Labor
Statistics of the United States Department of Labor that
measures the average change in prices of goods and services
purchased by all urban consumers, United States city average,
all items, 1982-84 = 100. The new amount resulting from each
annual adjustment shall be determined by the Public Pension
Division of the Department of Insurance and made available to
the boards of the pension funds by November 1 of each year.
(Source: P.A. 99-905, eff. 11-29-16.)
(40 ILCS 5/5-168) (from Ch. 108 1/2, par. 5-168)
Sec. 5-168. Financing.
(a) Except as expressly provided in this Section, the city
shall levy a tax annually upon all taxable property therein
for the purpose of providing revenue for the fund.
The tax shall be at a rate that will produce a sum which,
when added to the amounts deducted from the policemen's
salaries and the amounts deposited in accordance with
subsection (g), is sufficient for the purposes of the fund.
For the years 1968 and 1969, the city council shall levy a
tax annually at a rate on the dollar of the assessed valuation

HB4065 - 91 - LRB103 31966 RPS 60743 b
of all taxable property that will produce, when extended, not
to exceed $9,700,000. Beginning with the year 1970 and through
2014, the city council shall levy a tax annually at a rate on
the dollar of the assessed valuation of all taxable property
that will produce when extended an amount not to exceed the
total amount of contributions by the policemen to the Fund
made in the calendar year 2 years before the year for which the
applicable annual tax is levied, multiplied by 1.40 for the
tax levy year 1970; by 1.50 for the year 1971; by 1.65 for
1972; by 1.85 for 1973; by 1.90 for 1974; by 1.97 for 1975
through 1981; by 2.00 for 1982 and for each tax levy year
through 2014. Beginning in tax levy year 2015, the city
council shall levy a tax annually at a rate on the dollar of
the assessed valuation of all taxable property that will
produce when extended an annual amount that is equal to no less
than the amount of the city's contribution in each of the
following payment years: for 2016, $420,000,000; for 2017,
$464,000,000; for 2018, $500,000,000; for 2019, $557,000,000;
for 2020, $579,000,000.
Beginning in tax levy year 2020 and until levy year 2024,
the city council shall levy a tax annually at a rate on the
dollar of the assessed valuation of all taxable property that
will produce when extended an annual amount that is equal to no
less than (1) the normal cost to the Fund, plus (2) an annual
amount sufficient to bring the total assets of the Fund up to
90% of the total actuarial liabilities of the Fund by the end

HB4065 - 92 - LRB103 31966 RPS 60743 b
of fiscal year 2055, as annually updated and determined by an
enrolled actuary employed by the Illinois Department of
Insurance or by an enrolled actuary retained by the Fund.
Beginning in tax levy year 2024, the city council shall levy a
tax annually at a rate on the dollar of the assessed valuation
of all taxable property that will produce when extended an
annual amount that is equal to no less than (1) the normal cost
to the Fund, plus (2) an annual amount sufficient to bring the
total assets of the Fund up to 90% of the total actuarial
liabilities of the Fund by the end of fiscal year 2055, as
annually updated and determined by an enrolled actuary
employed by the Department of Insurance or by an enrolled
actuary retained by the Fund, minus (3) the amount of the
anticipated State contribution from the Local Government
Retirement Fund for the payment year. In making these
determinations, the required minimum employer contribution
shall be calculated each year as a level percentage of payroll
over the years remaining up to and including fiscal year 2055
and shall be determined under the entry age normal actuarial
cost method.
Beginning in payment year 2056, the city's total required
contribution in that year and each year thereafter shall be an
annual amount that is equal to no less than (1) the normal cost
of the Fund, plus (2) the annual amount determined by an
enrolled actuary employed by the Illinois Department of
Insurance or by an enrolled actuary retained by the Fund to be

HB4065 - 93 - LRB103 31966 RPS 60743 b
equal to the amount, if any, needed to bring the total
actuarial assets of the Fund up to 90% of the total actuarial
liabilities of the Fund as of the end of the year, utilizing
the entry age normal cost method as provided above.
For the purposes of this subsection (a), contributions by
the policeman to the Fund shall not include payments made by a
policeman to establish credit under Section 5-214.2 of this
Code.
(a-1) Beginning in State fiscal year 2024, the city
council shall annually certify to the Governor the amount of
(1) the normal cost to the Fund, plus (2) an annual amount
sufficient to bring the total assets of the Fund up to 90% of
the total actuarial liabilities of the Fund by the end of
fiscal year 2055, as annually updated and determined by an
enrolled actuary employed by the Department of Insurance or by
an enrolled actuary retained by the Fund.
(a-5) For purposes of determining the required employer
contribution to the Fund, the value of the Fund's assets shall
be equal to the actuarial value of the Fund's assets, which
shall be calculated as follows:
(1) On March 30, 2011, the actuarial value of the
Fund's assets shall be equal to the market value of the
assets as of that date.
(2) In determining the actuarial value of the Fund's
assets for fiscal years after March 30, 2011, any
actuarial gains or losses from investment return incurred

HB4065 - 94 - LRB103 31966 RPS 60743 b
in a fiscal year shall be recognized in equal annual
amounts over the 5-year period following that fiscal year.
(a-7) If the city fails to transmit to the Fund
contributions required of it under this Article for more than
90 days after the payment of those contributions is due, the
Fund shall, after giving notice to the city, certify to the
State Comptroller the amounts of the delinquent payments, and
the Comptroller must, beginning in fiscal year 2016, deduct
and deposit into the Fund the certified amounts or a portion of
those amounts from the following proportions of grants of
State funds to the city:
(1) in fiscal year 2016, one-third of the total amount
of any grants of State funds to the city;
(2) in fiscal year 2017, two-thirds of the total
amount of any grants of State funds to the city; and
(3) in fiscal year 2018 and each fiscal year
thereafter, the total amount of any grants of State funds
to the city.
The State Comptroller may not deduct from any grants of
State funds to the city more than the amount of delinquent
payments certified to the State Comptroller by the Fund.
(b) The tax shall be levied and collected in like manner
with the general taxes of the city, and is in addition to all
other taxes which the city is now or may hereafter be
authorized to levy upon all taxable property therein, and is
exclusive of and in addition to the amount of tax the city is

HB4065 - 95 - LRB103 31966 RPS 60743 b
now or may hereafter be authorized to levy for general
purposes under any law which may limit the amount of tax which
the city may levy for general purposes. The county clerk of the
county in which the city is located, in reducing tax levies
under Section 8-3-1 of the Illinois Municipal Code, shall not
consider the tax herein authorized as a part of the general tax
levy for city purposes, and shall not include the tax in any
limitation of the percent of the assessed valuation upon which
taxes are required to be extended for the city.
(c) On or before January 10 of each year, the board shall
notify the city council of the requirement that the tax herein
authorized be levied by the city council for that current
year. The board shall compute the amounts necessary for the
purposes of this fund to be credited to the reserves
established and maintained within the fund; shall make an
annual determination of the amount of the required city
contributions; and shall certify the results thereof to the
city council.
As soon as any revenue derived from the tax is collected it
shall be paid to the city treasurer of the city and shall be
held by him for the benefit of the fund in accordance with this
Article.
(d) If the funds available are insufficient during any
year to meet the requirements of this Article, the city may
issue tax anticipation warrants against the tax levy for the
current fiscal year.

HB4065 - 96 - LRB103 31966 RPS 60743 b
(e) The various sums, including interest, to be
contributed by the city, shall be taken from the revenue
derived from such tax or otherwise as expressly provided in
this Section. Any moneys of the city derived from any source
other than the tax herein authorized shall not be used for any
purpose of the fund nor the cost of administration thereof,
unless applied to make the deposit expressly authorized in
this Section or the additional city contributions required
under subsection (h).
(f) If it is not possible or practicable for the city to
make its contributions at the time that salary deductions are
made, the city shall make such contributions as soon as
possible thereafter, with interest thereon to the time it is
made.
(g) In lieu of levying all or a portion of the tax required
under this Section in any year, the city may deposit with the
city treasurer no later than March 1 of that year for the
benefit of the fund, to be held in accordance with this
Article, an amount that, together with the taxes levied under
this Section for that year, is not less than the amount of the
city contributions for that year as certified by the board to
the city council. The deposit may be derived from any source
legally available for that purpose, including, but not limited
to, the proceeds of city borrowings and State contributions.
The making of a deposit shall satisfy fully the requirements
of this Section for that year to the extent of the amounts so

HB4065 - 97 - LRB103 31966 RPS 60743 b
deposited. Amounts deposited under this subsection may be used
by the fund for any of the purposes for which the proceeds of
the tax levied under this Section may be used, including the
payment of any amount that is otherwise required by this
Article to be paid from the proceeds of that tax.
(h) In addition to the contributions required under the
other provisions of this Article, by November 1 of the
following specified years, the city shall deposit with the
city treasurer for the benefit of the fund, to be held and used
in accordance with this Article, the following specified
amounts: $6,300,000 in 1999; $5,880,000 in 2000; $5,460,000 in
2001; $5,040,000 in 2002; and $4,620,000 in 2003.
The additional city contributions required under this
subsection are intended to decrease the unfunded liability of
the fund and shall not decrease the amount of the city
contributions required under the other provisions of this
Article. The additional city contributions made under this
subsection may be used by the fund for any of its lawful
purposes.
(i) Any proceeds received by the city in relation to the
operation of a casino or casinos within the city shall be
expended by the city for payment to the Policemen's Annuity
and Benefit Fund of Chicago to satisfy the city contribution
obligation in any year.
(Source: P.A. 99-506, eff. 5-30-16.)

HB4065 - 98 - LRB103 31966 RPS 60743 b
(40 ILCS 5/5-169) (from Ch. 108 1/2, par. 5-169)
Sec. 5-169. Contributions for age and service annuities or
Tier 2 monthly retirement annuities for present employees and
future entrants.
(a) Beginning on the effective date and before January 1,
1954, 3 1/2% per annum (except that beginning July 1, 1939 and
before January 1, 1954 for a future entrant, 4%) and beginning
January 1, 1954 and before August 1, 1957, 6%, and beginning
August 1, 1957, 7% of each payment of the salary of each
present employee and future entrant shall be deducted and
contributed to the fund for age and service annuity or Tier 2
monthly retirement annuity. The deductions shall be made from
each payment of salary and shall continue while the employee
is in service.
Any policeman whose employment has been transferred to the
police service of the city as a result of the Chicago Park and
City Exchange of Functions Act "An Act in relation to or
exchange of certain functions, property and personnel among
cities, and park districts having co-extensive geographic
areas and populations in excess of 500,000", approved July 5,
1957, as now and hereafter amended, shall also contribute a
sum equal to 2% of the total salary received by him in his
employment between August 1, 1957 to July 17, 1959, with the
park district from which he has been transferred together with
interest on the unpaid contributions of 4% per annum from July
17, 1959 to the date such payments are made. Such additional

HB4065 - 99 - LRB103 31966 RPS 60743 b
sum may be paid at any time before the time such policeman
enters into age and service annuity.
Concurrently with each such deduction, beginning on the
effective date and prior to January 1, 1954, 8 1/2% (except for
a future entrant beginning on July 1, 1939, 9 5/7%) and
beginning January 1, 1954, 9 5/7% of each payment of salary
shall be contributed by the city, but in the case of a future
entrant who attains age 63 prior to January 1, 1988 while still
in service, no contributions shall be made for the period
between the date the employee attains age 63 and January 1,
1988.
(b) Each deduction from salary made prior to the date the
age and service annuity for the employee is fixed, and each
contribution by the city, shall be credited to the employee
and be improved by interest for a present employee during the
time he is in service until age and service annuity is fixed,
and, for a future entrant, during the time he is in service.
The sum accumulated shall be used to provide age and service
annuity for the employee.
Beginning September 1, 1967, the deductions from salary
provided in Section 5-167.1 shall also be made.
(Source: P.A. 99-905, eff. 11-29-16.)
(40 ILCS 5/5-239 new)
Sec. 5-239. Application of this amendatory Act of the
103rd General Assembly. It is the intent of this amendatory

HB4065 - 100 - LRB103 31966 RPS 60743 b
Act of the 103rd General Assembly to provide to policemen who
first became policemen on or after January 1, 2011 the same
level of benefits and eligibility criteria for benefits as
those who first became policemen before January 1, 2011. The
changes made to this Article by this amendatory Act of the
103rd General Assembly that provide benefit increases for
policemen apply without regard to whether the policeman was in
service on or after the effective date of this amendatory Act
of the 103rd General Assembly, notwithstanding the provisions
of Section 1-103.1. The benefit increases are intended to
apply prospectively and do not entitle a policeman to
retroactive benefit payments or increases. The changes made to
this Article by this amendatory Act of the 103rd General
Assembly shall not cause or otherwise result in any
retroactive adjustment of any employee contributions.
(40 ILCS 5/6-165) (from Ch. 108 1/2, par. 6-165)
Sec. 6-165. Financing; tax.
(a) Except as expressly provided in this Section, each
city shall levy a tax annually upon all taxable property
therein for the purpose of providing revenue for the fund. For
the years prior to the year 1960, the tax rate shall be as
provided for in the "Firemen's Annuity and Benefit Fund of the
Illinois Municipal Code". The tax, from and after January 1,
1968 to and including the year 1971, shall not exceed .0863% of
the value, as equalized or assessed by the Department of

HB4065 - 101 - LRB103 31966 RPS 60743 b
Revenue, of all taxable property in the city. Beginning with
the year 1972 and through 2014, the city shall levy a tax
annually at a rate on the dollar of the value, as equalized or
assessed by the Department of Revenue of all taxable property
within such city that will produce, when extended, not to
exceed an amount equal to the total amount of contributions by
the employees to the fund made in the calendar year 2 years
prior to the year for which the annual applicable tax is
levied, multiplied by 2.23 through the calendar year 1981, and
by 2.26 for the year 1982 and for each tax levy year through
2014. Beginning in tax levy year 2015, the city council shall
levy a tax annually at a rate on the dollar of the assessed
valuation of all taxable property that will produce when
extended an annual amount that is equal to no less than the
amount of the city's contribution in each of the following
payment years: for 2016, $199,000,000; for 2017, $208,000,000;
for 2018, $227,000,000; for 2019, $235,000,000; for 2020,
$245,000,000.
Beginning in tax levy year 2020 and until tax levy year
2024, the city council shall levy a tax annually at a rate on
the dollar of the assessed valuation of all taxable property
that will produce when extended an annual amount that is equal
to no less than (1) the normal cost to the Fund, plus (2) an
annual amount sufficient to bring the total assets of the Fund
up to 90% of the total actuarial liabilities of the Fund by the
end of fiscal year 2055, as annually updated and determined by

HB4065 - 102 - LRB103 31966 RPS 60743 b
an enrolled actuary employed by the Illinois Department of
Insurance or by an enrolled actuary retained by the Fund or the
city. Beginning in tax levy year 2024, the city council shall
levy a tax annually at a rate on the dollar of the assessed
valuation of all taxable property that will produce when
extended an annual amount that is equal to no less than (1) the
normal cost to the Fund, plus (2) an annual amount sufficient
to bring the total assets of the Fund up to 90% of the total
actuarial liabilities of the Fund by the end of fiscal year
2055, as annually updated and determined by an enrolled
actuary employed by the Department of Insurance or by an
enrolled actuary retained by the Fund or the city, minus (3)
the amount of the anticipated State contribution from the
Local Government Retirement Fund for the payment year. In
making these determinations, the required minimum employer
contribution shall be calculated each year as a level
percentage of payroll over the years remaining up to and
including fiscal year 2055 and shall be determined under the
entry age normal actuarial cost method. Beginning in payment
year 2056, the city's required contribution in that year and
for each year thereafter shall be an annual amount that is
equal to no less than (1) the normal cost to the Fund, plus (2)
the annual amount determined by an enrolled actuary employed
by the Illinois Department of Insurance or by an enrolled
actuary retained by the Fund to be equal to the amount, if any,
needed to bring the total actuarial assets of the Fund up to

HB4065 - 103 - LRB103 31966 RPS 60743 b
90% of the total actuarial liabilities of the Fund as of the
end of the year, utilizing the entry age normal actuarial cost
method as provided above.
To provide revenue for the ordinary death benefit
established by Section 6-150 of this Article, in addition to
the contributions by the firemen for this purpose, the city
council shall for the year 1962 and each year thereafter
annually levy a tax, which shall be in addition to and
exclusive of the taxes authorized to be levied under the
foregoing provisions of this Section, upon all taxable
property in the city, as equalized or assessed by the
Department of Revenue, at such rate per cent of the value of
such property as shall be sufficient to produce for each year
the sum of $142,000.
The amounts produced by the taxes levied annually,
together with the deposit expressly authorized in this Section
and any State contributions, shall be sufficient, when added
to the amounts deducted from the salaries of firemen and
applied to the fund, to provide for the purposes of the fund.
(a-1) Beginning in State fiscal year 2024, the city
council shall annually certify to the Governor the amount of
(1) the normal cost to the Fund, plus (2) an annual amount
sufficient to bring the total assets of the Fund up to 90% of
the total actuarial liabilities of the Fund by the end of
fiscal year 2055, as annually updated and determined by an
enrolled actuary employed by the Department of Insurance or by

HB4065 - 104 - LRB103 31966 RPS 60743 b
an enrolled actuary retained by the Fund.
(a-5) For purposes of determining the required employer
contribution to the Fund, the value of the Fund's assets shall
be equal to the actuarial value of the Fund's assets, which
shall be calculated as follows:
(1) On March 30, 2011, the actuarial value of the
Fund's assets shall be equal to the market value of the
assets as of that date.
(2) In determining the actuarial value of the Fund's
assets for fiscal years after March 30, 2011, any
actuarial gains or losses from investment return incurred
in a fiscal year shall be recognized in equal annual
amounts over the 5-year period following that fiscal year.
(a-7) If the city fails to transmit to the Fund
contributions required of it under this Article for more than
90 days after the payment of those contributions is due, the
Fund shall, after giving notice to the city, certify to the
State Comptroller the amounts of the delinquent payments, and
the Comptroller must, beginning in fiscal year 2016, deduct
and deposit into the Fund the certified amounts or a portion of
those amounts from the following proportions of grants of
State funds to the city:
(1) in fiscal year 2016, one-third of the total amount
of any grants of State funds to the city;
(2) in fiscal year 2017, two-thirds of the total
amount of any grants of State funds to the city; and

HB4065 - 105 - LRB103 31966 RPS 60743 b
(3) in fiscal year 2018 and each fiscal year
thereafter, the total amount of any grants of State funds
to the city.
The State Comptroller may not deduct from any grants of
State funds to the city more than the amount of delinquent
payments certified to the State Comptroller by the Fund.
(b) The taxes shall be levied and collected in like manner
with the general taxes of the city, and shall be in addition to
all other taxes which the city may levy upon all taxable
property therein and shall be exclusive of and in addition to
the amount of tax the city may levy for general purposes under
Section 8-3-1 of the Illinois Municipal Code, approved May 29,
1961, as amended, or under any other law or laws which may
limit the amount of tax which the city may levy for general
purposes.
(c) The amounts of the taxes to be levied in each year
shall be certified to the city council by the board.
(d) As soon as any revenue derived from such taxes is
collected, it shall be paid to the city treasurer and held for
the benefit of the fund, and all such revenue shall be paid
into the fund in accordance with the provisions of this
Article.
(e) If the funds available are insufficient during any
year to meet the requirements of this Article, the city may
issue tax anticipation warrants, against the tax levies herein
authorized for the current fiscal year.

HB4065 - 106 - LRB103 31966 RPS 60743 b
(f) The various sums, hereinafter stated, including
interest, to be contributed by the city, shall be taken from
the revenue derived from the taxes or otherwise as expressly
provided in this Section. Except for defraying the cost of
administration of the fund during the calendar year in which a
city first attains a population of 500,000 and comes under the
provisions of this Article and the first calendar year
thereafter, any money of the city derived from any source
other than these taxes or the sale of tax anticipation
warrants shall not be used to provide revenue for the fund, nor
to pay any part of the cost of administration thereof, unless
applied to make the deposit expressly authorized in this
Section or the additional city contributions required under
subsection (h).
(g) In lieu of levying all or a portion of the tax required
under this Section in any year, the city may deposit with the
city treasurer no later than March 1 of that year for the
benefit of the fund, to be held in accordance with this
Article, an amount that, together with the taxes levied under
this Section for that year, is not less than the amount of the
city contributions for that year as certified by the board to
the city council. The deposit may be derived from any source
legally available for that purpose, including, but not limited
to, the proceeds of city borrowings and State contributions.
The making of a deposit shall satisfy fully the requirements
of this Section for that year to the extent of the amounts so

HB4065 - 107 - LRB103 31966 RPS 60743 b
deposited. Amounts deposited under this subsection may be used
by the fund for any of the purposes for which the proceeds of
the taxes levied under this Section may be used, including the
payment of any amount that is otherwise required by this
Article to be paid from the proceeds of those taxes.
(h) In addition to the contributions required under the
other provisions of this Article, by November 1 of the
following specified years, the city shall deposit with the
city treasurer for the benefit of the fund, to be held and used
in accordance with this Article, the following specified
amounts: $6,300,000 in 1999; $5,880,000 in 2000; $5,460,000 in
2001; $5,040,000 in 2002; and $4,620,000 in 2003.
The additional city contributions required under this
subsection are intended to decrease the unfunded liability of
the fund and shall not decrease the amount of the city
contributions required under the other provisions of this
Article. The additional city contributions made under this
subsection may be used by the fund for any of its lawful
purposes.
(i) Any proceeds received by the city in relation to the
operation of a casino or casinos within the city shall be
expended by the city for payment to the Firemen's Annuity and
Benefit Fund of Chicago to satisfy the city contribution
obligation in any year.
(Source: P.A. 99-506, eff. 5-30-16.)

HB4065 - 108 - LRB103 31966 RPS 60743 b
(40 ILCS 5/6-210) (from Ch. 108 1/2, par. 6-210)
Sec. 6-210. Credit allowed for service in police
department. Service rendered by a fireman, as a regularly
appointed and sworn policeman of the city shall be included,
for the purposes of this Article, as if such service were
rendered as a fireman of the city. Salary received by a fireman
for any such service as a policeman shall be considered, for
the purposes of this Article, as salary received as a fireman.
Any annuity payable to a fireman under this Article shall be
reduced by any pension or annuity payable to him from any
policemen's annuity and benefit fund in operation in the city,
and any member entering service after January 1, 2011 shall
not be given service credit in this fund for any period of time
in which the member is in receipt of retirement benefits from
any annuity and benefit fund in operation in the city.
Any policeman who becomes a fireman, subsequent to July 1,
1935, may contribute to the fund an amount equal to the sum
which would have accumulated to his credit from deductions
from salary for annuity purposes if he had been contributing
to the fund such sums as he contributed for annuity purposes to
the policemen's annuity and benefit fund, and no credit for
periods of service rendered by him in the police department
shall be allowed, under this Article, except as to such
periods for which he made contributions to the policemen's
annuity and benefit fund, provided he has made the payments
required by this Article.

HB4065 - 109 - LRB103 31966 RPS 60743 b
(Source: P.A. 96-1466, eff. 8-20-10.)
(40 ILCS 5/6-231 new)
Sec. 6-231. Application of this amendatory Act of the
103rd General Assembly. It is the intent of this amendatory
Act of the 103rd General Assembly to provide to firemen who
first became firemen on or after January 1, 2011 the same level
of benefits and eligibility criteria for benefits as those who
first became firemen before January 1, 2011. The changes made
to this Article by this amendatory Act of the 103rd General
Assembly that provide benefit increases for firemen apply
without regard to whether the fireman was in service on or
after the effective date of this amendatory Act of the 103rd
General Assembly, notwithstanding the provisions of Section
1-103.1. The benefit increases are intended to apply
prospectively and do not entitle a fireman to retroactive
benefit payments or increases. The changes made to this
Article by this amendatory Act of the 103rd General Assembly
shall not cause or otherwise result in any retroactive
adjustment of any employee contributions.
(40 ILCS 5/7-142.1) (from Ch. 108 1/2, par. 7-142.1)
Sec. 7-142.1. Sheriff's law enforcement employees.
(a) In lieu of the retirement annuity provided by
subparagraph 1 of paragraph (a) of Section 7-142:
Any sheriff's law enforcement employee who has 20 or more

HB4065 - 110 - LRB103 31966 RPS 60743 b
years of service in that capacity and who terminates service
prior to January 1, 1988 shall be entitled at his option to
receive a monthly retirement annuity for his service as a
sheriff's law enforcement employee computed by multiplying 2%
for each year of such service up to 10 years, 2 1/4% for each
year of such service above 10 years and up to 20 years, and 2
1/2% for each year of such service above 20 years, by his
annual final rate of earnings and dividing by 12.
Any sheriff's law enforcement employee who has 20 or more
years of service in that capacity and who terminates service
on or after January 1, 1988 and before July 1, 2004 shall be
entitled at his option to receive a monthly retirement annuity
for his service as a sheriff's law enforcement employee
computed by multiplying 2.5% for each year of such service up
to 20 years, 2% for each year of such service above 20 years
and up to 30 years, and 1% for each year of such service above
30 years, by his annual final rate of earnings and dividing by
12.
Any sheriff's law enforcement employee who has 20 or more
years of service in that capacity and who terminates service
on or after July 1, 2004 shall be entitled at his or her option
to receive a monthly retirement annuity for service as a
sheriff's law enforcement employee computed by multiplying
2.5% for each year of such service by his annual final rate of
earnings and dividing by 12.
If a sheriff's law enforcement employee has service in any

HB4065 - 111 - LRB103 31966 RPS 60743 b
other capacity, his retirement annuity for service as a
sheriff's law enforcement employee may be computed under this
Section and the retirement annuity for his other service under
Section 7-142.
In no case shall the total monthly retirement annuity for
persons who retire before July 1, 2004 exceed 75% of the
monthly final rate of earnings. In no case shall the total
monthly retirement annuity for persons who retire on or after
July 1, 2004 exceed 80% of the monthly final rate of earnings.
(b) Whenever continued group insurance coverage is elected
in accordance with the provisions of Section 367h of the
Illinois Insurance Code, as now or hereafter amended, the
total monthly premium for such continued group insurance
coverage or such portion thereof as is not paid by the
municipality shall, upon request of the person electing such
continued group insurance coverage, be deducted from any
monthly pension benefit otherwise payable to such person
pursuant to this Section, to be remitted by the Fund to the
insurance company or other entity providing the group
insurance coverage.
(c) A sheriff's law enforcement employee who began service
in that capacity prior to the effective date of this
amendatory Act of the 97th General Assembly and who has
service in any other capacity may convert up to 10 years of
that service into service as a sheriff's law enforcement
employee by paying to the Fund an amount equal to (1) the

HB4065 - 112 - LRB103 31966 RPS 60743 b
additional employee contribution required under Section
7-173.1, plus (2) the additional employer contribution
required under Section 7-172, plus (3) interest on items (1)
and (2) at the prescribed rate from the date of the service to
the date of payment. Application must be received by the Board
while the employee is an active participant in the Fund.
Payment must be received while the member is an active
participant, except that one payment will be permitted after
termination of participation.
(d) The changes to subsections (a) and (b) of this Section
made by this amendatory Act of the 94th General Assembly apply
only to persons in service on or after July 1, 2004. In the
case of such a person who begins to receive a retirement
annuity before the effective date of this amendatory Act of
the 94th General Assembly, the annuity shall be recalculated
prospectively to reflect those changes, with the resulting
increase beginning to accrue on the first annuity payment date
following the effective date of this amendatory Act.
(e) Any elected county officer who was entitled to receive
a stipend from the State on or after July 1, 2009 and on or
before June 30, 2010 may establish earnings credit for the
amount of stipend not received, if the elected county official
applies in writing to the fund within 6 months after the
effective date of this amendatory Act of the 96th General
Assembly and pays to the fund an amount equal to (i) employee
contributions on the amount of stipend not received, (ii)

HB4065 - 113 - LRB103 31966 RPS 60743 b
employer contributions determined by the Board equal to the
employer's normal cost of the benefit on the amount of stipend
not received, plus (iii) interest on items (i) and (ii) at the
actuarially assumed rate.
(f) It is the intent of this amendatory Act of the 103rd
General Assembly to provide to sheriff's law enforcement
employees who first became sheriff's law enforcement employees
on or after January 1, 2011 the same level of benefits and
eligibility criteria for benefits as those who first became
sheriff's law enforcement employees before January 1, 2011.
The changes made to this Article by this amendatory Act of the
103rd General Assembly that provide benefit increases for
sheriff's law enforcement employees apply without regard to
whether the sheriff's law enforcement employee was in service
on or after the effective date of this amendatory Act of the
103rd General Assembly, notwithstanding the provisions of
Section 1-103.1. The benefit increases are intended to apply
prospectively and do not entitle a sheriff's law enforcement
employee to retroactive benefit payments or increases. The
changes made to this Article by this amendatory Act of the
103rd General Assembly shall not cause or otherwise result in
any retroactive adjustment of any employee contributions.
(f) Notwithstanding any other provision of this Article,
the provisions of this subsection (f) apply to a person who
first becomes a sheriff's law enforcement employee under this
Article on or after January 1, 2011.

HB4065 - 114 - LRB103 31966 RPS 60743 b
A sheriff's law enforcement employee age 55 or more who
has 10 or more years of service in that capacity shall be
entitled at his option to receive a monthly retirement annuity
for his or her service as a sheriff's law enforcement employee
computed by multiplying 2.5% for each year of such service by
his or her final rate of earnings.
The retirement annuity of a sheriff's law enforcement
employee who is retiring after attaining age 50 with 10 or more
years of creditable service shall be reduced by one-half of 1%
for each month that the sheriff's law enforcement employee's
age is under age 55.
The maximum retirement annuity under this subsection (f)
shall be 75% of final rate of earnings.
For the purposes of this subsection (f), "final rate of
earnings" means the average monthly earnings obtained by
dividing the total salary of the sheriff's law enforcement
employee during the 96 consecutive months of service within
the last 120 months of service in which the total earnings was
the highest by the number of months of service in that period.
Notwithstanding any other provision of this Article,
beginning on January 1, 2011, for all purposes under this Code
(including without limitation the calculation of benefits and
employee contributions), the annual earnings of a sheriff's
law enforcement employee to whom this Section applies shall
not include overtime and shall not exceed $106,800; however,
that amount shall annually thereafter be increased by the

HB4065 - 115 - LRB103 31966 RPS 60743 b
lesser of (i) 3% of that amount, including all previous
adjustments, or (ii) one-half the annual unadjusted percentage
increase (but not less than zero) in the consumer price
index-u for the 12 months ending with the September preceding
each November 1, including all previous adjustments.
(g) Notwithstanding any other provision of this Article,
the monthly annuity of a person who first becomes a sheriff's
law enforcement employee under this Article on or after
January 1, 2011 shall be increased on the January 1 occurring
either on or after the attainment of age 60 or the first
anniversary of the annuity start date, whichever is later.
Each annual increase shall be calculated at 3% or one-half the
annual unadjusted percentage increase (but not less than zero)
in the consumer price index-u for the 12 months ending with the
September preceding each November 1, whichever is less, of the
originally granted retirement annuity. If the annual
unadjusted percentage change in the consumer price index-u for
a 12-month period ending in September is zero or, when
compared with the preceding period, decreases, then the
annuity shall not be increased.
(h) Notwithstanding any other provision of this Article,
for a person who first becomes a sheriff's law enforcement
employee under this Article on or after January 1, 2011, the
annuity to which the surviving spouse, children, or parents
are entitled under this subsection (h) shall be in the amount
of 66 2/3% of the sheriff's law enforcement employee's earned

HB4065 - 116 - LRB103 31966 RPS 60743 b
annuity at the date of death.
(i) Notwithstanding any other provision of this Article,
the monthly annuity of a survivor of a person who first becomes
a sheriff's law enforcement employee under this Article on or
after January 1, 2011 shall be increased on the January 1 after
attainment of age 60 by the recipient of the survivor's
annuity and each January 1 thereafter by 3% or one-half the
annual unadjusted percentage increase in the consumer price
index-u for the 12 months ending with the September preceding
each November 1, whichever is less, of the originally granted
pension. If the annual unadjusted percentage change in the
consumer price index-u for a 12-month period ending in
September is zero or, when compared with the preceding period,
decreases, then the annuity shall not be increased.
(j) For the purposes of this Section, "consumer price
index-u" means the index published by the Bureau of Labor
Statistics of the United States Department of Labor that
measures the average change in prices of goods and services
purchased by all urban consumers, United States city average,
all items, 1982-84 = 100. The new amount resulting from each
annual adjustment shall be determined by the Public Pension
Division of the Department of Insurance and made available to
the boards of the pension funds.
(Source: P.A. 100-148, eff. 8-18-17.)
(40 ILCS 5/7-171) (from Ch. 108 1/2, par. 7-171)

HB4065 - 117 - LRB103 31966 RPS 60743 b
Sec. 7-171. Finance; taxes.
(a) Each municipality other than a school district shall
appropriate an amount sufficient to provide for the current
municipality contributions required by Section 7-172 of this
Article, for the fiscal year for which the appropriation is
made and all amounts due for municipal contributions for
previous years. Those municipalities which have been assessed
an annual amount to amortize its unfunded obligation, as
provided in subparagraph 4 of paragraph (a) of Section 7-172
of this Article, shall include in the appropriation an amount
sufficient to pay the amount assessed. The appropriation shall
be based upon an estimate of assets available for municipality
contributions and liabilities therefor for the fiscal year for
which appropriations are to be made, including funds available
from levies for this purpose in prior years.
(b) For the purpose of providing monies for municipality
contributions, beginning for the year in which a municipality
is included in this fund:
(1) A municipality other than a school district may
levy a tax which shall not exceed the amount appropriated
for municipality contributions minus the amount of the
anticipated State contribution from the Local Government
Retirement Fund to the municipality for that year.
(2) A school district may levy a tax in an amount
reasonably calculated at the time of the levy to provide
for the municipality contributions required under Section

HB4065 - 118 - LRB103 31966 RPS 60743 b
7-172 of this Article for the fiscal years for which
revenues from the levy will be received and all amounts
due for municipal contributions for previous years. Any
levy adopted before the effective date of this amendatory
Act of 1995 by a school district shall be considered valid
and authorized to the extent that the amount was
reasonably calculated at the time of the levy to provide
for the municipality contributions required under Section
7-172 for the fiscal years for which revenues from the
levy will be received and all amounts due for municipal
contributions for previous years. In no event shall a
budget adopted by a school district limit a levy of that
school district adopted under this Section.
(c) Any county which is served by a regional office of
education that serves 2 or more counties may include in its
appropriation an amount sufficient to provide its
proportionate share of the municipality contributions for that
regional office of education. The tax levy authorized by this
Section may include an amount necessary to provide monies for
this contribution.
(d) Any county that is a part of a multiple-county health
department or consolidated health department which is formed
under "An Act in relation to the establishment and maintenance
of county and multiple-county public health departments",
approved July 9, 1943, as amended, and which is a
participating instrumentality may include in the county's

HB4065 - 119 - LRB103 31966 RPS 60743 b
appropriation an amount sufficient to provide its
proportionate share of municipality contributions of the
department. The tax levy authorized by this Section may
include the amount necessary to provide monies for this
contribution.
(d-5) A school district participating in a special
education joint agreement created under Section 10-22.31 of
the School Code that is a participating instrumentality may
include in the school district's tax levy under this Section
an amount sufficient to provide its proportionate share of the
municipality contributions for current and prior service by
employees of the participating instrumentality created under
the joint agreement.
(e) Such tax shall be levied and collected in like manner,
with the general taxes of the municipality and shall be in
addition to all other taxes which the municipality is now or
may hereafter be authorized to levy upon all taxable property
therein, and shall be exclusive of and in addition to the
amount of tax levied for general purposes under Section 8-3-1
of the "Illinois Municipal Code", approved May 29, 1961, as
amended, or under any other law or laws which may limit the
amount of tax which the municipality may levy for general
purposes. The tax may be levied by the governing body of the
municipality without being authorized as being additional to
all other taxes by a vote of the people of the municipality.
(f) The county clerk of the county in which any such

HB4065 - 120 - LRB103 31966 RPS 60743 b
municipality is located, in reducing tax levies shall not
consider any such tax as a part of the general tax levy for
municipality purposes, and shall not include the same in the
limitation of any other tax rate which may be extended.
(g) The amount of the tax to be levied in any year shall,
within the limits herein prescribed, be determined by the
governing body of the respective municipality.
(h) The revenue derived from any such tax levy shall be
used only for the contributions required under Section 7-172
and, as collected, shall be paid to the treasurer of the
municipality levying the tax. Monies received by a county
treasurer for use in making contributions to a regional office
of education for its municipality contributions shall be held
by him for that purpose and paid to the regional office of
education in the same manner as other monies appropriated for
the expense of the regional office.
(Source: P.A. 96-1084, eff. 7-16-10; 97-933, eff. 8-10-12.)
(40 ILCS 5/7-172) (from Ch. 108 1/2, par. 7-172)
Sec. 7-172. Contributions by participating municipalities
and participating instrumentalities.
(a) Each participating municipality and each participating
instrumentality shall make payment to the fund as follows:
1. municipality contributions in an amount determined
by applying the municipality contribution rate to each
payment of earnings paid to each of its participating

HB4065 - 121 - LRB103 31966 RPS 60743 b
employees;
2. an amount equal to the employee contributions
provided by paragraph (a) of Section 7-173, whether or not
the employee contributions are withheld as permitted by
that Section;
3. all accounts receivable, together with interest
charged thereon, as provided in Section 7-209, and any
amounts due under subsection (a-5) of Section 7-144;
4. if it has no participating employees with current
earnings, an amount payable which, over a closed period of
20 years for participating municipalities and 10 years for
participating instrumentalities, will amortize, at the
effective rate for that year, any unfunded obligation. The
unfunded obligation shall be computed as provided in
paragraph 2 of subsection (b);
5. if it has fewer than 7 participating employees or a
negative balance in its municipality reserve, the greater
of (A) an amount payable that, over a period of 20 years,
will amortize at the effective rate for that year any
unfunded obligation, computed as provided in paragraph 2
of subsection (b) or (B) the amount required by paragraph
1 of this subsection (a).
(b) A separate municipality contribution rate shall be
determined for each calendar year for all participating
municipalities together with all instrumentalities thereof.
The municipality contribution rate shall be determined for

HB4065 - 122 - LRB103 31966 RPS 60743 b
participating instrumentalities as if they were participating
municipalities. The municipality contribution rate shall be
the sum of the following percentages:
1. The percentage of earnings of all the participating
employees of all participating municipalities and
participating instrumentalities which, if paid over the
entire period of their service, will be sufficient when
combined with all employee contributions available for the
payment of benefits, to provide all annuities for
participating employees, and the $3,000 death benefit
payable under Sections 7-158 and 7-164, such percentage to
be known as the normal cost rate.
2. The percentage of earnings of the participating
employees of each participating municipality and
participating instrumentalities necessary to adjust for
the difference between the present value of all benefits,
excluding temporary and total and permanent disability and
death benefits, to be provided for its participating
employees and the sum of its accumulated municipality
contributions and the accumulated employee contributions
and the present value of expected future employee and
municipality contributions pursuant to subparagraph 1 of
this paragraph (b). This adjustment shall be spread over a
period determined by the Board, not to exceed 30 years for
participating municipalities or 10 years for participating
instrumentalities.

HB4065 - 123 - LRB103 31966 RPS 60743 b
3. The percentage of earnings of the participating
employees of all municipalities and participating
instrumentalities necessary to provide the present value
of all temporary and total and permanent disability
benefits granted during the most recent year for which
information is available.
4. The percentage of earnings of the participating
employees of all participating municipalities and
participating instrumentalities necessary to provide the
present value of the net single sum death benefits
expected to become payable from the reserve established
under Section 7-206 during the year for which this rate is
fixed.
5. The percentage of earnings necessary to meet any
deficiency arising in the Terminated Municipality Reserve.
(c) A separate municipality contribution rate shall be
computed for each participating municipality or participating
instrumentality for its sheriff's law enforcement employees.
A separate municipality contribution rate shall be
computed for the sheriff's law enforcement employees of each
forest preserve district that elects to have such employees.
For the period from January 1, 1986 to December 31, 1986, such
rate shall be the forest preserve district's regular rate plus
2%.
Beginning in fiscal year 2024, the Board shall annually
certify to the Governor the amount of each participant

HB4065 - 124 - LRB103 31966 RPS 60743 b
municipality's and participating instrumentality's
contribution for its sheriff's law enforcement employees.
In the event that the Board determines that there is an
actuarial deficiency in the account of any municipality with
respect to a person who has elected to participate in the Fund
under Section 3-109.1 of this Code, the Board may adjust the
municipality's contribution rate so as to make up that
deficiency over such reasonable period of time as the Board
may determine.
(d) The Board may establish a separate municipality
contribution rate for all employees who are program
participants employed under the federal Comprehensive
Employment Training Act by all of the participating
municipalities and instrumentalities. The Board may also
provide that, in lieu of a separate municipality rate for
these employees, a portion of the municipality contributions
for such program participants shall be refunded or an extra
charge assessed so that the amount of municipality
contributions retained or received by the fund for all CETA
program participants shall be an amount equal to that which
would be provided by the separate municipality contribution
rate for all such program participants. Refunds shall be made
to prime sponsors of programs upon submission of a claim
therefor and extra charges shall be assessed to participating
municipalities and instrumentalities. In establishing the
municipality contribution rate as provided in paragraph (b) of

HB4065 - 125 - LRB103 31966 RPS 60743 b
this Section, the use of a separate municipality contribution
rate for program participants or the refund of a portion of the
municipality contributions, as the case may be, may be
considered.
(e) Computations of municipality contribution rates for
the following calendar year shall be made prior to the
beginning of each year, from the information available at the
time the computations are made, and on the assumption that the
employees in each participating municipality or participating
instrumentality at such time will continue in service until
the end of such calendar year at their respective rates of
earnings at such time.
(f) Any municipality which is the recipient of State
allocations representing that municipality's contributions for
retirement annuity purposes on behalf of its employees as
provided in Section 12-21.16 of the Illinois Public Aid Code
shall pay the allocations so received to the Board for such
purpose. Estimates of State allocations to be received during
any taxable year shall be considered in the determination of
the municipality's tax rate for that year under Section 7-171.
If a special tax is levied under Section 7-171, none of the
proceeds may be used to reimburse the municipality for the
amount of State allocations received and paid to the Board.
Any multiple-county or consolidated health department which
receives contributions from a county under Section 11.2 of "An
Act in relation to establishment and maintenance of county and

HB4065 - 126 - LRB103 31966 RPS 60743 b
multiple-county health departments", approved July 9, 1943, as
amended, or distributions under Section 3 of the Department of
Public Health Act, shall use these only for municipality
contributions by the health department.
(g) Municipality contributions for the several purposes
specified shall, for township treasurers and employees in the
offices of the township treasurers who meet the qualifying
conditions for coverage hereunder, be allocated among the
several school districts and parts of school districts
serviced by such treasurers and employees in the proportion
which the amount of school funds of each district or part of a
district handled by the treasurer bears to the total amount of
all school funds handled by the treasurer.
From the funds subject to allocation among districts and
parts of districts pursuant to the School Code, the trustees
shall withhold the proportionate share of the liability for
municipality contributions imposed upon such districts by this
Section, in respect to such township treasurers and employees
and remit the same to the Board.
The municipality contribution rate for an educational
service center shall initially be the same rate for each year
as the regional office of education or school district which
serves as its administrative agent. When actuarial data become
available, a separate rate shall be established as provided in
subparagraph (i) of this Section.
The municipality contribution rate for a public agency,

HB4065 - 127 - LRB103 31966 RPS 60743 b
other than a vocational education cooperative, formed under
the Intergovernmental Cooperation Act shall initially be the
average rate for the municipalities which are parties to the
intergovernmental agreement. When actuarial data become
available, a separate rate shall be established as provided in
subparagraph (i) of this Section.
(h) Each participating municipality and participating
instrumentality shall make the contributions in the amounts
provided in this Section in the manner prescribed from time to
time by the Board and all such contributions shall be
obligations of the respective participating municipalities and
participating instrumentalities to this fund. The failure to
deduct any employee contributions shall not relieve the
participating municipality or participating instrumentality of
its obligation to this fund. Delinquent payments of
contributions due under this Section may, with interest, be
recovered by civil action against the participating
municipalities or participating instrumentalities.
Municipality contributions, other than the amount necessary
for employee contributions, for periods of service by
employees from whose earnings no deductions were made for
employee contributions to the fund, may be charged to the
municipality reserve for the municipality or participating
instrumentality.
(i) Contributions by participating instrumentalities shall
be determined as provided herein except that the percentage

HB4065 - 128 - LRB103 31966 RPS 60743 b
derived under subparagraph 2 of paragraph (b) of this Section,
and the amount payable under subparagraph 4 of paragraph (a)
of this Section, shall be based on an amortization period of 10
years.
(j) Notwithstanding the other provisions of this Section,
the additional unfunded liability accruing as a result of
Public Act 94-712 shall be amortized over a period of 30 years
beginning on January 1 of the second calendar year following
the calendar year in which Public Act 94-712 takes effect,
except that the employer may provide for a longer amortization
period by adopting a resolution or ordinance specifying a
35-year or 40-year period and submitting a certified copy of
the ordinance or resolution to the fund no later than June 1 of
the calendar year following the calendar year in which Public
Act 94-712 takes effect.
(k) If the amount of a participating employee's reported
earnings for any of the 12-month periods used to determine the
final rate of earnings exceeds the employee's 12-month
reported earnings with the same employer for the previous year
by the greater of 6% or 1.5 times the annual increase in the
Consumer Price Index-U, as established by the United States
Department of Labor for the preceding September, the
participating municipality or participating instrumentality
that paid those earnings shall pay to the Fund, in addition to
any other contributions required under this Article, the
present value of the increase in the pension resulting from

HB4065 - 129 - LRB103 31966 RPS 60743 b
the portion of the increase in reported earnings that is in
excess of the greater of 6% or 1.5 times the annual increase in
the Consumer Price Index-U, as determined by the Fund. This
present value shall be computed on the basis of the actuarial
assumptions and tables used in the most recent actuarial
valuation of the Fund that is available at the time of the
computation.
Whenever it determines that a payment is or may be
required under this subsection (k), the fund shall calculate
the amount of the payment and bill the participating
municipality or participating instrumentality for that amount.
The bill shall specify the calculations used to determine the
amount due. If the participating municipality or participating
instrumentality disputes the amount of the bill, it may,
within 30 days after receipt of the bill, apply to the fund in
writing for a recalculation. The application must specify in
detail the grounds of the dispute. Upon receiving a timely
application for recalculation, the fund shall review the
application and, if appropriate, recalculate the amount due.
The participating municipality and participating
instrumentality contributions required under this subsection
(k) may be paid in the form of a lump sum within 90 days after
receipt of the bill. If the participating municipality and
participating instrumentality contributions are not paid
within 90 days after receipt of the bill, then interest will be
charged at a rate equal to the fund's annual actuarially

HB4065 - 130 - LRB103 31966 RPS 60743 b
assumed rate of return on investment compounded annually from
the 91st day after receipt of the bill. Payments must be
concluded within 3 years after receipt of the bill by the
participating municipality or participating instrumentality.
When assessing payment for any amount due under this
subsection (k), the fund shall exclude earnings increases
resulting from overload or overtime earnings.
When assessing payment for any amount due under this
subsection (k), the fund shall exclude earnings increases
resulting from payments for unused vacation time, but only for
payments for unused vacation time made in the final 3 months of
the final rate of earnings period.
When assessing payment for any amount due under this
subsection (k), the fund shall also exclude earnings increases
attributable to standard employment promotions resulting in
increased responsibility and workload.
When assessing payment for any amount due under this
subsection (k), the fund shall exclude reportable earnings
increases resulting from periods where the member was paid
through workers' compensation.
This subsection (k) does not apply to earnings increases
paid to individuals under contracts or collective bargaining
agreements entered into, amended, or renewed before January 1,
2012 (the effective date of Public Act 97-609), earnings
increases paid to members who are 10 years or more from
retirement eligibility, or earnings increases resulting from

HB4065 - 131 - LRB103 31966 RPS 60743 b
an increase in the number of hours required to be worked.
When assessing payment for any amount due under this
subsection (k), the fund shall also exclude earnings
attributable to personnel policies adopted before January 1,
2012 (the effective date of Public Act 97-609) as long as those
policies are not applicable to employees who begin service on
or after January 1, 2012 (the effective date of Public Act
97-609).
The change made to this Section by Public Act 100-139 is a
clarification of existing law and is intended to be
retroactive to January 1, 2012 (the effective date of Public
Act 97-609).
(Source: P.A. 102-849, eff. 5-13-22.)
(40 ILCS 5/14-152.1)
Sec. 14-152.1. Application and expiration of new benefit
increases.
(a) As used in this Section, "new benefit increase" means
an increase in the amount of any benefit provided under this
Article, or an expansion of the conditions of eligibility for
any benefit under this Article, that results from an amendment
to this Code that takes effect after June 1, 2005 (the
effective date of Public Act 94-4). "New benefit increase",
however, does not include any benefit increase resulting from
the changes made to Article 1 or this Article by Public Act
96-37, Public Act 100-23, Public Act 100-587, Public Act

HB4065 - 132 - LRB103 31966 RPS 60743 b
100-611, Public Act 101-10, Public Act 101-610, Public Act
102-210, Public Act 102-856, Public Act 102-956, or this
amendatory Act of the 103rd General Assembly this amendatory
Act of the 102nd General Assembly.
(b) Notwithstanding any other provision of this Code or
any subsequent amendment to this Code, every new benefit
increase is subject to this Section and shall be deemed to be
granted only in conformance with and contingent upon
compliance with the provisions of this Section.
(c) The Public Act enacting a new benefit increase must
identify and provide for payment to the System of additional
funding at least sufficient to fund the resulting annual
increase in cost to the System as it accrues.
Every new benefit increase is contingent upon the General
Assembly providing the additional funding required under this
subsection. The Commission on Government Forecasting and
Accountability shall analyze whether adequate additional
funding has been provided for the new benefit increase and
shall report its analysis to the Public Pension Division of
the Department of Insurance. A new benefit increase created by
a Public Act that does not include the additional funding
required under this subsection is null and void. If the Public
Pension Division determines that the additional funding
provided for a new benefit increase under this subsection is
or has become inadequate, it may so certify to the Governor and
the State Comptroller and, in the absence of corrective action

HB4065 - 133 - LRB103 31966 RPS 60743 b
by the General Assembly, the new benefit increase shall expire
at the end of the fiscal year in which the certification is
made.
(d) Every new benefit increase shall expire 5 years after
its effective date or on such earlier date as may be specified
in the language enacting the new benefit increase or provided
under subsection (c). This does not prevent the General
Assembly from extending or re-creating a new benefit increase
by law.
(e) Except as otherwise provided in the language creating
the new benefit increase, a new benefit increase that expires
under this Section continues to apply to persons who applied
and qualified for the affected benefit while the new benefit
increase was in effect and to the affected beneficiaries and
alternate payees of such persons, but does not apply to any
other person, including, without limitation, a person who
continues in service after the expiration date and did not
apply and qualify for the affected benefit while the new
benefit increase was in effect.
(Source: P.A. 101-10, eff. 6-5-19; 101-81, eff. 7-12-19;
101-610, eff. 1-1-20; 102-210, eff. 7-30-21; 102-856, eff.
1-1-23; 102-956, eff. 5-27-22.)
(40 ILCS 5/15-108.1)
Sec. 15-108.1. Tier 1 member. "Tier 1 member": A
participant or an annuitant of a retirement annuity under this

HB4065 - 134 - LRB103 31966 RPS 60743 b
Article, other than a participant in the self-managed plan
under Section 15-158.2, who first became a participant or
member before January 1, 2011 under any reciprocal retirement
system or pension fund established under this Code, other than
a retirement system or pension fund established under Articles
2, 3, 4, 5, 6, or 18 of this Code. "Tier 1 member" includes a
participant or an annuitant who is a police officer or
firefighter regardless of when the participant or annuitant
first became a participant or member of a reciprocal
retirement system or pension fund established under this Code,
other than a retirement system or pension fund established
under Articles 2, 3, 4, 5, 6, or 18 of this Code. "Tier 1
member" includes a person who first became a participant under
this System before January 1, 2011 and who accepts a refund and
is subsequently reemployed by an employer on or after January
1, 2011.
(Source: P.A. 98-92, eff. 7-16-13.)
(40 ILCS 5/15-108.2)
Sec. 15-108.2. Tier 2 member. "Tier 2 member": A person
who first becomes a participant under this Article on or after
January 1, 2011 and before the implementation date, as defined
under subsection (a) of Section 1-161, determined by the
Board, other than a person in the self-managed plan
established under Section 15-158.2 or a person who makes the
election under subsection (c) of Section 1-161, unless the

HB4065 - 135 - LRB103 31966 RPS 60743 b
person is otherwise a Tier 1 member. The changes made to this
Section by this amendatory Act of the 98th General Assembly
are a correction of existing law and are intended to be
retroactive to the effective date of Public Act 96-889,
notwithstanding the provisions of Section 1-103.1 of this
Code. "Tier 2 member" does not include a participant or an
annuitant who is a police officer or firefighter regardless of
when the participant or annuitant first became a participant
or member of a reciprocal retirement system or pension fund
established under this Code.
(Source: P.A. 100-23, eff. 7-6-17; 100-563, eff. 12-8-17.)
(40 ILCS 5/15-135) (from Ch. 108 1/2, par. 15-135)
Sec. 15-135. Retirement annuities; conditions.
(a) This subsection (a) applies only to a Tier 1 member. A
participant who retires in one of the following specified
years with the specified amount of service is entitled to a
retirement annuity at any age under the retirement program
applicable to the participant:
35 years if retirement is in 1997 or before;
34 years if retirement is in 1998;
33 years if retirement is in 1999;
32 years if retirement is in 2000;
31 years if retirement is in 2001;
30 years if retirement is in 2002 or later.
A participant with 8 or more years of service after

HB4065 - 136 - LRB103 31966 RPS 60743 b
September 1, 1941, is entitled to a retirement annuity on or
after attainment of age 55.
A participant with at least 5 but less than 8 years of
service after September 1, 1941, is entitled to a retirement
annuity on or after attainment of age 62.
A participant who has at least 25 years of service in this
system as a police officer or firefighter is entitled to a
retirement annuity on or after the attainment of age 50, if
Rule 4 of Section 15-136 is applicable to the participant.
(a-5) A Tier 2 member is entitled to a retirement annuity
upon written application if he or she has attained age 67 and
has at least 10 years of service credit and is otherwise
eligible under the requirements of this Article. A Tier 2
member who has attained age 62 and has at least 10 years of
service credit and is otherwise eligible under the
requirements of this Article may elect to receive the lower
retirement annuity provided in subsection (b-5) of Section
15-136 of this Article.
(a-10) (Blank). A Tier 2 member who has at least 20 years
of service in this system as a police officer or firefighter is
entitled to a retirement annuity upon written application on
or after the attainment of age 60 if Rule 4 of Section 15-136
is applicable to the participant. The changes made to this
subsection by this amendatory Act of the 101st General
Assembly apply retroactively to January 1, 2011.
(b) The annuity payment period shall begin on the date

HB4065 - 137 - LRB103 31966 RPS 60743 b
specified by the participant or the recipient of a disability
retirement annuity submitting a written application. For a
participant, the date on which the annuity payment period
begins shall not be prior to termination of employment or more
than one year before the application is received by the board;
however, if the participant is not an employee of an employer
participating in this System or in a participating system as
defined in Article 20 of this Code on April 1 of the calendar
year next following the calendar year in which the participant
attains the age specified under Section 401(a)(9) of the
Internal Revenue Code of 1986, as amended, the annuity payment
period shall begin on that date regardless of whether an
application has been filed. For a recipient of a disability
retirement annuity, the date on which the annuity payment
period begins shall not be prior to the discontinuation of the
disability retirement annuity under Section 15-153.2.
(c) An annuity is not payable if the amount provided under
Section 15-136 is less than $10 per month.
(Source: P.A. 101-610, eff. 1-1-20; 102-210, eff. 7-30-21.)
(40 ILCS 5/15-136) (from Ch. 108 1/2, par. 15-136)
Sec. 15-136. Retirement annuities; amount - Amount. The
provisions of this Section 15-136 apply only to those
participants who are participating in the traditional benefit
package or the portable benefit package and do not apply to
participants who are participating in the self-managed plan.

HB4065 - 138 - LRB103 31966 RPS 60743 b
(a) The amount of a participant's retirement annuity,
expressed in the form of a single-life annuity, shall be
determined by whichever of the following rules is applicable
and provides the largest annuity:
Rule 1: The retirement annuity shall be 1.67% of final
rate of earnings for each of the first 10 years of service,
1.90% for each of the next 10 years of service, 2.10% for each
year of service in excess of 20 but not exceeding 30, and 2.30%
for each year in excess of 30; or for persons who retire on or
after January 1, 1998, 2.2% of the final rate of earnings for
each year of service.
Rule 2: The retirement annuity shall be the sum of the
following, determined from amounts credited to the participant
in accordance with the actuarial tables and the effective rate
of interest in effect at the time the retirement annuity
begins:
(i) the normal annuity which can be provided on an
actuarially equivalent basis, by the accumulated normal
contributions as of the date the annuity begins;
(ii) an annuity from employer contributions of an
amount equal to that which can be provided on an
actuarially equivalent basis from the accumulated normal
contributions made by the participant under Section
15-113.6 and Section 15-113.7 plus 1.4 times all other
accumulated normal contributions made by the participant;
and

HB4065 - 139 - LRB103 31966 RPS 60743 b
(iii) the annuity that can be provided on an
actuarially equivalent basis from the entire contribution
made by the participant under Section 15-113.3.
With respect to a police officer or firefighter who
retires on or after August 14, 1998, the accumulated normal
contributions taken into account under clauses (i) and (ii) of
this Rule 2 shall include the additional normal contributions
made by the police officer or firefighter under Section
15-157(a).
The amount of a retirement annuity calculated under this
Rule 2 shall be computed solely on the basis of the
participant's accumulated normal contributions, as specified
in this Rule and defined in Section 15-116. Neither an
employee or employer contribution for early retirement under
Section 15-136.2 nor any other employer contribution shall be
used in the calculation of the amount of a retirement annuity
under this Rule 2.
This amendatory Act of the 91st General Assembly is a
clarification of existing law and applies to every participant
and annuitant without regard to whether status as an employee
terminates before the effective date of this amendatory Act.
This Rule 2 does not apply to a person who first becomes an
employee under this Article on or after July 1, 2005.
Rule 3: The retirement annuity of a participant who is
employed at least one-half time during the period on which his
or her final rate of earnings is based, shall be equal to the

HB4065 - 140 - LRB103 31966 RPS 60743 b
participant's years of service not to exceed 30, multiplied by
(1) $96 if the participant's final rate of earnings is less
than $3,500, (2) $108 if the final rate of earnings is at least
$3,500 but less than $4,500, (3) $120 if the final rate of
earnings is at least $4,500 but less than $5,500, (4) $132 if
the final rate of earnings is at least $5,500 but less than
$6,500, (5) $144 if the final rate of earnings is at least
$6,500 but less than $7,500, (6) $156 if the final rate of
earnings is at least $7,500 but less than $8,500, (7) $168 if
the final rate of earnings is at least $8,500 but less than
$9,500, and (8) $180 if the final rate of earnings is $9,500 or
more, except that the annuity for those persons having made an
election under Section 15-154(a-1) shall be calculated and
payable under the portable retirement benefit program pursuant
to the provisions of Section 15-136.4.
Rule 4: A participant who is at least age 50 and has 25 or
more years of service as a police officer or firefighter, and a
participant who is age 55 or over and has at least 20 but less
than 25 years of service as a police officer or firefighter,
shall be entitled to a retirement annuity of 2 1/4% of the
final rate of earnings for each of the first 10 years of
service as a police officer or firefighter, 2 1/2% for each of
the next 10 years of service as a police officer or
firefighter, and 2 3/4% for each year of service as a police
officer or firefighter in excess of 20. The retirement annuity
for all other service shall be computed under Rule 1. A Tier 2

HB4065 - 141 - LRB103 31966 RPS 60743 b
member is eligible for a retirement annuity calculated under
Rule 4 only if that Tier 2 member meets the service
requirements for that benefit calculation as prescribed under
this Rule 4 in addition to the applicable age requirement
under subsection (a-10) of Section 15-135.
For purposes of this Rule 4, a participant's service as a
firefighter shall also include the following:
(i) service that is performed while the person is an
employee under subsection (h) of Section 15-107; and
(ii) in the case of an individual who was a
participating employee employed in the fire department of
the University of Illinois's Champaign-Urbana campus
immediately prior to the elimination of that fire
department and who immediately after the elimination of
that fire department transferred to another job with the
University of Illinois, service performed as an employee
of the University of Illinois in a position other than
police officer or firefighter, from the date of that
transfer until the employee's next termination of service
with the University of Illinois.
(b) For a Tier 1 member, the retirement annuity provided
under Rules 1 and 3 above shall be reduced by 1/2 of 1% for
each month the participant is under age 60 at the time of
retirement. However, this reduction shall not apply in the
following cases:
(1) For a disabled participant whose disability

HB4065 - 142 - LRB103 31966 RPS 60743 b
benefits have been discontinued because he or she has
exhausted eligibility for disability benefits under clause
(6) of Section 15-152;
(2) For a participant who has at least the number of
years of service required to retire at any age under
subsection (a) of Section 15-135; or
(3) For that portion of a retirement annuity which has
been provided on account of service of the participant
during periods when he or she performed the duties of a
police officer or firefighter, if these duties were
performed for at least 5 years immediately preceding the
date the retirement annuity is to begin.
(b-5) The retirement annuity of a Tier 2 member who is
retiring under Rule 1 or 3 after attaining age 62 with at least
10 years of service credit shall be reduced by 1/2 of 1% for
each full month that the member's age is under age 67.
(c) The maximum retirement annuity provided under Rules 1,
2, 4, and 5 shall be the lesser of (1) the annual limit of
benefits as specified in Section 415 of the Internal Revenue
Code of 1986, as such Section may be amended from time to time
and as such benefit limits shall be adjusted by the
Commissioner of Internal Revenue, and (2) 80% of final rate of
earnings.
(d) A Tier 1 member whose status as an employee terminates
after August 14, 1969 shall receive automatic increases in his
or her retirement annuity as follows:

HB4065 - 143 - LRB103 31966 RPS 60743 b
Effective January 1 immediately following the date the
retirement annuity begins, the annuitant shall receive an
increase in his or her monthly retirement annuity of 0.125% of
the monthly retirement annuity provided under Rule 1, Rule 2,
Rule 3, or Rule 4 contained in this Section, multiplied by the
number of full months which elapsed from the date the
retirement annuity payments began to January 1, 1972, plus
0.1667% of such annuity, multiplied by the number of full
months which elapsed from January 1, 1972, or the date the
retirement annuity payments began, whichever is later, to
January 1, 1978, plus 0.25% of such annuity multiplied by the
number of full months which elapsed from January 1, 1978, or
the date the retirement annuity payments began, whichever is
later, to the effective date of the increase.
The annuitant shall receive an increase in his or her
monthly retirement annuity on each January 1 thereafter during
the annuitant's life of 3% of the monthly annuity provided
under Rule 1, Rule 2, Rule 3, or Rule 4 contained in this
Section. The change made under this subsection by P.A. 81-970
is effective January 1, 1980 and applies to each annuitant
whose status as an employee terminates before or after that
date.
Beginning January 1, 1990, all automatic annual increases
payable under this Section shall be calculated as a percentage
of the total annuity payable at the time of the increase,
including all increases previously granted under this Article.

HB4065 - 144 - LRB103 31966 RPS 60743 b
The change made in this subsection by P.A. 85-1008 is
effective January 26, 1988, and is applicable without regard
to whether status as an employee terminated before that date.
(d-5) A retirement annuity of a Tier 2 member shall
receive annual increases on the January 1 occurring either on
or after the attainment of age 67 or the first anniversary of
the annuity start date, whichever is later. Each annual
increase shall be calculated at 3% or one half the annual
unadjusted percentage increase (but not less than zero) in the
consumer price index-u for the 12 months ending with the
September preceding each November 1, whichever is less, of the
originally granted retirement annuity. If the annual
unadjusted percentage change in the consumer price index-u for
the 12 months ending with the September preceding each
November 1 is zero or there is a decrease, then the annuity
shall not be increased.
(e) If, on January 1, 1987, or the date the retirement
annuity payment period begins, whichever is later, the sum of
the retirement annuity provided under Rule 1 or Rule 2 of this
Section and the automatic annual increases provided under the
preceding subsection or Section 15-136.1, amounts to less than
the retirement annuity which would be provided by Rule 3, the
retirement annuity shall be increased as of January 1, 1987,
or the date the retirement annuity payment period begins,
whichever is later, to the amount which would be provided by
Rule 3 of this Section. Such increased amount shall be

HB4065 - 145 - LRB103 31966 RPS 60743 b
considered as the retirement annuity in determining benefits
provided under other Sections of this Article. This paragraph
applies without regard to whether status as an employee
terminated before the effective date of this amendatory Act of
1987, provided that the annuitant was employed at least
one-half time during the period on which the final rate of
earnings was based.
(f) A participant is entitled to such additional annuity
as may be provided on an actuarially equivalent basis, by any
accumulated additional contributions to his or her credit.
However, the additional contributions made by the participant
toward the automatic increases in annuity provided under this
Section shall not be taken into account in determining the
amount of such additional annuity.
(g) If, (1) by law, a function of a governmental unit, as
defined by Section 20-107 of this Code, is transferred in
whole or in part to an employer, and (2) a participant
transfers employment from such governmental unit to such
employer within 6 months after the transfer of the function,
and (3) the sum of (A) the annuity payable to the participant
under Rule 1, 2, or 3 of this Section (B) all proportional
annuities payable to the participant by all other retirement
systems covered by Article 20, and (C) the initial primary
insurance amount to which the participant is entitled under
the Social Security Act, is less than the retirement annuity
which would have been payable if all of the participant's

HB4065 - 146 - LRB103 31966 RPS 60743 b
pension credits validated under Section 20-109 had been
validated under this system, a supplemental annuity equal to
the difference in such amounts shall be payable to the
participant.
(h) On January 1, 1981, an annuitant who was receiving a
retirement annuity on or before January 1, 1971 shall have his
or her retirement annuity then being paid increased $1 per
month for each year of creditable service. On January 1, 1982,
an annuitant whose retirement annuity began on or before
January 1, 1977, shall have his or her retirement annuity then
being paid increased $1 per month for each year of creditable
service.
(i) On January 1, 1987, any annuitant whose retirement
annuity began on or before January 1, 1977, shall have the
monthly retirement annuity increased by an amount equal to 8¢
per year of creditable service times the number of years that
have elapsed since the annuity began.
(j) The changes made to this Section by this amendatory
Act of the 101st General Assembly apply retroactively to
January 1, 2011.
(Source: P.A. 101-610, eff. 1-1-20.)
(40 ILCS 5/15-198)
Sec. 15-198. Application and expiration of new benefit
increases.
(a) As used in this Section, "new benefit increase" means

HB4065 - 147 - LRB103 31966 RPS 60743 b
an increase in the amount of any benefit provided under this
Article, or an expansion of the conditions of eligibility for
any benefit under this Article, that results from an amendment
to this Code that takes effect after June 1, 2005 (the
effective date of Public Act 94-4). "New benefit increase",
however, does not include any benefit increase resulting from
the changes made to Article 1 or this Article by Public Act
100-23, Public Act 100-587, Public Act 100-769, Public Act
101-10, Public Act 101-610, Public Act 102-16, or this
amendatory Act of the 103rd General Assembly this amendatory
Act of the 102nd General Assembly.
(b) Notwithstanding any other provision of this Code or
any subsequent amendment to this Code, every new benefit
increase is subject to this Section and shall be deemed to be
granted only in conformance with and contingent upon
compliance with the provisions of this Section.
(c) The Public Act enacting a new benefit increase must
identify and provide for payment to the System of additional
funding at least sufficient to fund the resulting annual
increase in cost to the System as it accrues.
Every new benefit increase is contingent upon the General
Assembly providing the additional funding required under this
subsection. The Commission on Government Forecasting and
Accountability shall analyze whether adequate additional
funding has been provided for the new benefit increase and
shall report its analysis to the Public Pension Division of

HB4065 - 148 - LRB103 31966 RPS 60743 b
the Department of Insurance. A new benefit increase created by
a Public Act that does not include the additional funding
required under this subsection is null and void. If the Public
Pension Division determines that the additional funding
provided for a new benefit increase under this subsection is
or has become inadequate, it may so certify to the Governor and
the State Comptroller and, in the absence of corrective action
by the General Assembly, the new benefit increase shall expire
at the end of the fiscal year in which the certification is
made.
(d) Every new benefit increase shall expire 5 years after
its effective date or on such earlier date as may be specified
in the language enacting the new benefit increase or provided
under subsection (c). This does not prevent the General
Assembly from extending or re-creating a new benefit increase
by law.
(e) Except as otherwise provided in the language creating
the new benefit increase, a new benefit increase that expires
under this Section continues to apply to persons who applied
and qualified for the affected benefit while the new benefit
increase was in effect and to the affected beneficiaries and
alternate payees of such persons, but does not apply to any
other person, including, without limitation, a person who
continues in service after the expiration date and did not
apply and qualify for the affected benefit while the new
benefit increase was in effect.

HB4065 - 149 - LRB103 31966 RPS 60743 b
(Source: P.A. 101-10, eff. 6-5-19; 101-81, eff. 7-12-19;
101-610, eff. 1-1-20; 102-16, eff. 6-17-21.)
(40 ILCS 5/15-203 new)
Sec. 15-203. Application of this amendatory Act of the
103rd General Assembly. It is the intent of this amendatory
Act of the 103rd General Assembly to provide to police
officers and firefighters who first became participants on or
after January 1, 2011 the same level of benefits and
eligibility criteria for benefits as those who first became
participants before January 1, 2011. The changes made to this
Article by this amendatory Act of the 103rd General Assembly
that provide benefit increases for police officers and
firefighters apply without regard to whether the participant
was in service on or after the effective date of this
amendatory Act of the 103rd General Assembly, notwithstanding
the provisions of Section 1-103.1. The benefit increases are
intended to apply prospectively and do not entitle a
participant to retroactive benefit payments or increases. The
changes made to this Article by this amendatory Act of the
103rd General Assembly shall not cause or otherwise result in
any retroactive adjustment of any employee contributions.
(40 ILCS 5/5-238 rep.)
(40 ILCS 5/6-229 rep.)
Section 15. The Illinois Pension Code is amended by

HB4065 - 150 - LRB103 31966 RPS 60743 b
repealing Sections 5-238 and 6-229.
Section 20. The Public Safety Employee Benefits Act is
amended by adding Section 11 as follows:
(820 ILCS 320/11 new)
Sec. 11. Retired police officers and firefighters. A unit
of local government that provides health insurance to police
officers and firefighters shall maintain the health insurance
plans of these employees after retirement and shall contribute
toward the cost of the annuitant's coverage under the unit of
local government's health insurance plan an amount equal to 4%
of that cost for each full year of creditable service upon
which the annuitant's retirement annuity is based, up to a
maximum of 100% for an annuitant with 25 or more years of
creditable service.
On or before November 15, 2023 and on or before November 15
of each year thereafter, the unit of local government shall
calculate and certify to the State Comptroller the health
insurance costs of the unit of local government's active and
retired police officers and firefighters for the next fiscal
year for the purposes of disbursement under Section 6z-139 of
the State Finance Act.
Section 90. The State Mandates Act is amended by adding
Section 8.47 as follows:

HB4065 - 151 - LRB103 31966 RPS 60743 b
(30 ILCS 805/8.47 new)
Sec. 8.47. Exempt mandate. Notwithstanding Sections 6 and
8 of this Act, no reimbursement by the State is required for
the implementation of any mandate created by this amendatory
Act of the 103rd General Assembly.
Section 95. No acceleration or delay. Where this Act makes
changes in a statute that is represented in this Act by text
that is not yet or no longer in effect (for example, a Section
represented by multiple versions), the use of that text does
not accelerate or delay the taking effect of (i) the changes
made by this Act or (ii) provisions derived from any other
Public Act.
Section 99. Effective date. This Act takes effect upon
becoming law.
HB4065 - 152 - LRB103 31966 RPS 60743 b
INDEX
Statutes amended in order of appearance
30 ILCS 105/5.990 new
30 ILCS 105/6z-139 new
40 ILCS 5/1-160
40 ILCS 5/3-111 from Ch. 108 1/2, par. 3-111
40 ILCS 5/3-111.1 from Ch. 108 1/2, par. 3-111.1
40 ILCS 5/3-112 from Ch. 108 1/2, par. 3-112
40 ILCS 5/3-125 from Ch. 108 1/2, par. 3-125
40 ILCS 5/3-148.5 new
40 ILCS 5/4-109 from Ch. 108 1/2, par. 4-109
40 ILCS 5/4-109.1 from Ch. 108 1/2, par. 4-109.1
40 ILCS 5/4-114 from Ch. 108 1/2, par. 4-114
40 ILCS 5/4-118 from Ch. 108 1/2, par. 4-118
40 ILCS 5/4-138.15 new
40 ILCS 5/5-155 from Ch. 108 1/2, par. 5-155
40 ILCS 5/5-167.1 from Ch. 108 1/2, par. 5-167.1
40 ILCS 5/5-168 from Ch. 108 1/2, par. 5-168
40 ILCS 5/5-169 from Ch. 108 1/2, par. 5-169
40 ILCS 5/5-239 new
40 ILCS 5/6-165 from Ch. 108 1/2, par. 6-165
40 ILCS 5/6-210 from Ch. 108 1/2, par. 6-210
40 ILCS 5/6-231 new
40 ILCS 5/7-142.1 from Ch. 108 1/2, par. 7-142.1
40 ILCS 5/7-171 from Ch. 108 1/2, par. 7-171
HB4065 - 153 - LRB103 31966 RPS 60743 b