Bill Text: IL HB4659 | 2017-2018 | 100th General Assembly | Engrossed

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Bill Title: Amends the Chicago Police Article of the Illinois Pension Code. Removes a birthdate restriction on eligibility at age 55 for a 3% automatic annual increase in retirement annuity that is not subject to a maximum increase of 30%. Makes a related change. Specifies the timing of an initial increase in retirement annuity for persons who have not received the initial increase before January 1, 2019. Effective immediately.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Failed) 2019-01-08 - Session Sine Die [HB4659 Detail]

Download: Illinois-2017-HB4659-Engrossed.html

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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 Illinois Pension Code is amended by changing
Sections 5-167.1 and 6-164 as follows:
(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 55 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 55
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 3% 1 1/2% and
such first fixed annuity as granted at retirement increased by
an additional 3% 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

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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 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

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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 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.
Any policeman born after January 1, 1966 who qualifies for
a minimum annuity and retires after September 1, 1967 but has

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not received the initial increase under this subsection before
January 1, 2019 is entitled to receive the initial increase
under this subsection on (1) January 1, 2019, (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 100th 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.

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Such deductions from salary and city contributions shall
continue while the policeman is in service.
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. 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

HB4659 Engrossed - 6 - LRB100 17234 RPS 32393 b
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 5/6-164) (from Ch. 108 1/2, par. 6-164)
Sec. 6-164. Automatic annual increase; retirement after
September 1, 1959.
(a) A fireman qualifying for a minimum annuity who retires
from service after September 1, 1959 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 that 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

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additional 1 1/2% in January of each year thereafter up to a
maximum increase of 30%. Beginning July 1, 1982 for firemen
born before January 1, 1930, and beginning January 1, 1990 for
firemen born after December 31, 1929 and before January 1,
1940, and beginning January 1, 1996 for firemen born after
December 31, 1939 but before January 1, 1945, and beginning
January 1, 2004, for firemen born after December 31, 1944 but
before January 1, 1955, and beginning January 1, 2017, for
firemen born after December 31, 1954 but before January 1,
1966, such increases shall be 3% and such firemen shall not be
subject to the 30% maximum increase.
Any fireman 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
this amendatory Act of 1995 apply beginning January 1, 1996 and
apply without regard to whether the fireman or annuitant
terminated service before the effective date of this amendatory
Act of 1995.
Any fireman 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, 2004 is entitled to receive the initial increase

HB4659 Engrossed - 8 - LRB100 17234 RPS 32393 b
under this subsection on (1) January 1, 2004, (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 93rd General Assembly apply without
regard to whether the fireman or annuitant terminated service
before the effective date of this amendatory Act.
Any fireman born after December 31, 1954 but before January
1, 1966 who qualifies for a minimum annuity and retires after
September 1, 1967 is entitled to receive an 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 an increase of 3% of his
then fixed and payable monthly annuity upon the first of the
month following the first anniversary of his date of retirement
if he is age 55 or over on that anniversary date or upon the
first of the month following his attainment of age 55 if that
date occurs after the first anniversary of his retirement date
and such first fixed annuity as granted at retirement shall be
increased by an additional 3% in January of each year
thereafter. In the case of a fireman born after December 31,
1954 but before January 1, 1966 who received an increase in any
year of 1.5%, that fireman shall receive an increase for any
such year so that the total increase is equal to 3% for each
year the fireman would have been otherwise eligible had the
fireman not received any increase. The changes to this
subsection made by this amendatory Act of the 99th General

HB4659 Engrossed - 9 - LRB100 17234 RPS 32393 b
Assembly apply without regard to whether the fireman or
annuitant terminated service before the effective date of this
amendatory Act. The changes to this subsection made by this
amendatory Act of the 100th General Assembly are a declaration
of existing law and shall not be construed as a new enactment.
Any fireman who qualifies for a minimum annuity and retires
after September 1, 1967 is entitled to receive an increase
under this subsection on (1) January 1, 2019, (2) the first
anniversary of the date of retirement, or (3) attainment of age
55, whichever occurs last, in an amount equal to an increase of
3% of his or her then fixed and payable monthly annuity upon
the first of the month following the first anniversary of his
or her date of retirement if he or she is age 55 or over on that
anniversary date or upon the first of the month following his
or her attainment of age 55 if that date occurs after the first
anniversary of his or her retirement date and such first fixed
annuity as granted at retirement shall be increased by an
additional 3% in January of each year thereafter. In the case
of a fireman who received an increase in any year of 1.5%, that
fireman shall receive an increase for any such year so that the
total increase is equal to 3% for each year the fireman would
have been otherwise eligible had the fireman not received any
increase. The changes to this subsection made by this
amendatory Act of the 100th General Assembly apply without
regard to whether the fireman or annuitant terminated service
before the effective date of this amendatory Act of the 100th

HB4659 Engrossed - 10 - LRB100 17234 RPS 32393 b
General Assembly.
(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, 1959, from each
payment of salary to a fireman, 1/8 of 1% of each such salary
payment and an additional 1/8 of 1% beginning on September 1,
1961, and September 1, 1963, respectively, concurrently with
and in addition to the salary deductions otherwise made for
annuity purposes.
Each such additional 1/8 of 1% deduction from salary which
shall, on September 1, 1963, result in a total increase of 3/8
of 1% of salary, shall be credited to the Automatic Increase
Reserve, to be used, together with city contributions as
provided in this Article, to defray the cost of the annuity
increments specified in 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.
The salary deductions provided in this Section are not
subject to refund, except to the fireman himself in any case in
which: (i) the fireman withdraws prior to qualification for
minimum annuity or Tier 2 monthly retirement annuity and
applies for refund, (ii) the fireman 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

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the fireman, without interest, and charged to the
aforementioned reserve.
(d) Notwithstanding any other provision of this Article,
the Tier 2 monthly retirement annuity of a person who first
becomes a fireman under this Article on or after January 1,
2011 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. 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.
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.

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(Source: P.A. 99-905, eff. 11-29-16; 100-23, eff. 7-6-17;
100-539, eff. 11-7-17.)
Section 90. The State Mandates Act is amended by adding
Section 8.42 as follows:
(30 ILCS 805/8.42 new)
Sec. 8.42. 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 100th General Assembly.
Section 99. Effective date. This Act takes effect upon
becoming law.