Bill Text: IL SB2795 | 2019-2020 | 101st General Assembly | Engrossed

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Bill Title: Amends the Illinois Pension Code. In the Illinois Municipal Retirement Fund (IMRF) Article, provides that retirement annuities shall be payable upon attainment of the required age of distribution under a specified provision of the Internal Revenue Code of 1986 (instead of age 70 1/2). In the State Universities Article, provides that if a participant is not an employee of an employer participating in the System or in a reciprocal system on April 1 of the calendar year next following the calendar year in which the participant attains the age specified under a provision of the Internal Revenue Code of 1986 (instead of the age of 70 1/2), the annuity payment period shall begin on that date. In a provision of the Downstate Teacher Article concerning the required distribution of monthly survivor benefits for certain persons, provides that the distribution shall become payable on certain dates or December 1 of the calendar year in which the deceased member or annuitant would have attained age 72 (instead of 70 1/2), whichever occurs latest. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Failed) 2021-01-13 - Session Sine Die [SB2795 Detail]

Download: Illinois-2019-SB2795-Engrossed.html

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SB2795 Engrossed LRB101 19188 RPS 68651 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 Illinois Pension Code is amended by changing
Sections 2-121.3, 7-141, 14-121.1, 15-135, 16-142.3, and
18-128.3 as follows:
(40 ILCS 5/2-121.3) (from Ch. 108 1/2, par. 2-121.3)
Sec. 2-121.3. Required distributions. (a) A person who
would be eligible to receive a survivor's annuity under this
Article but for the fact that the person has not yet attained
age 50, shall be eligible for a monthly distribution under this
subsection (a), provided that the payment of such distribution
is required by federal law.
The distribution shall become payable on (i) July 1, 1987,
(ii) December 1 of the calendar year immediately following the
calendar year in which the deceased spouse died, or (iii)
December 1 of the calendar year in which the deceased spouse
would have attained age 72 70 1/2, whichever occurs last, and
shall remain payable until the first of the following to occur:
(1) the person becomes eligible to receive a survivor's annuity
under this Article; (2) the end of the month in which the
person ceases to be eligible to receive a survivor's annuity
upon attainment of age 50, due to remarriage or death; or (3)

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the end of the month in which such distribution ceases to be
required by federal law.
The amount of the distribution shall be fixed at the time
the distribution first becomes payable, and shall be calculated
in the same manner as a survivor's annuity under Sections
2-121, 2-121.1 and 2-121.2, but excluding: (A) any requirement
for an application for the distribution; (B) any automatic
annual increases, supplemental increases, or one-time
increases that may be provided by law for survivor's annuities;
and (C) any lump-sum or death benefit.
(b) For the purpose of this Section, a distribution shall
be deemed to be required by federal law if: (1) directly
mandated by federal statute, rule, or administrative or court
decision; or (2) indirectly mandated through imposition of
substantial tax or other penalties for noncompliance.
(c) Notwithstanding Section 1-103.1 of this Code, a member
need not be in service on or after the effective date of this
amendatory Act of 1989 for the member's surviving spouse to be
eligible for a distribution under this Section.
(Source: P.A. 86-273.)
(40 ILCS 5/7-141) (from Ch. 108 1/2, par. 7-141)
Sec. 7-141. Retirement annuities - Conditions. Retirement
annuities shall be payable as hereinafter set forth:
(a) A participating employee who, regardless of cause, is
separated from the service of all participating municipalities

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and instrumentalities thereof and participating
instrumentalities shall be entitled to a retirement annuity
provided:
1. He is at least age 55, or in the case of a person who
is eligible to have his annuity calculated under Section
7-142.1, he is at least age 50;
2. He is not entitled to receive earnings for
employment in a position requiring him, or entitling him to
elect, to be a participating employee;
3. The amount of his annuity, before the application of
paragraph (b) of Section 7-142 is at least $10 per month;
4. If he first became a participating employee after
December 31, 1961, he has at least 8 years of service. This
service requirement shall not apply to any participating
employee, regardless of participation date, if the General
Assembly terminates the Fund.
(b) Retirement annuities shall be payable:
1. As provided in Section 7-119;
2. Except as provided in item 3, upon receipt by the
fund of a written application. The effective date may be
not more than one year prior to the date of the receipt by
the fund of the application;
3. Upon attainment of the required age of distribution
under Section 401(a)(9) of the Internal Revenue Code of
1986, as amended, age 70 1/2 if the member (i) is no longer
in service, and (ii) is otherwise entitled to an annuity

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under this Article;
4. To the beneficiary of the deceased annuitant for the
unpaid amount accrued to date of death, if any.
(Source: P.A. 97-328, eff. 8-12-11; 97-609, eff. 1-1-12.)
(40 ILCS 5/14-121.1) (from Ch. 108 1/2, par. 14-121.1)
Sec. 14-121.1. Required distributions. (a) A person who
would be eligible to receive a widow's or survivor's annuity
under this Article but for the fact that the person has not yet
attained age 50, shall be eligible for a monthly distribution
under this subsection (a), provided that the payment of such
distribution is required by federal law.
The distribution shall become payable on (i) July 1, 1987,
(ii) December 1 of the calendar year immediately following the
calendar year in which the deceased spouse died, or (iii)
December 1 of the calendar year in which the deceased spouse
would have attained age 72 70 1/2, whichever occurs last, and
shall remain payable until the first of the following to occur:
(1) the person becomes eligible to receive a widow's or
survivor's annuity under this Article; (2) the end of the month
in which the person ceases to be eligible to receive a widow's
or survivor's annuity upon attainment of age 50, due to
remarriage or death; or (3) the end of the month in which such
distribution ceases to be required by federal law.
The amount of the distribution shall be fixed at the time
the distribution first becomes payable, and shall be calculated

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in the same manner as a survivor's annuity under Sections
14-120, 14-121 and 14-122 (or, in the case of a person who has
elected to receive a widow's annuity instead of a survivor's
annuity, in the same manner as the widow's annuity under
Sections 14-118 and 14-119), but excluding: (A) any requirement
for an application for the distribution; (B) any automatic
annual increases, supplemental increases, or one-time
increases that may be provided by law for survivor's or widow's
annuities; and (C) any lump-sum or death benefit.
(b) For the purpose of this Section, a distribution shall
be deemed to be required by federal law if: (1) directly
mandated by federal statute, rule, or administrative or court
decision; or (2) indirectly mandated through imposition of
substantial tax or other penalties for noncompliance.
(c) Notwithstanding Section 1-103.1 of this Code, a member
need not be in service on or after the effective date of this
amendatory Act of 1989 for the member's surviving spouse to be
eligible for a distribution under this Section.
(Source: P.A. 86-273.)
(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

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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
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.

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(a-10) 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
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 70 1/2, 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.

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(Source: P.A. 100-556, eff. 12-8-17; 101-610, eff. 1-1-20.)
(40 ILCS 5/16-142.3) (from Ch. 108 1/2, par. 16-142.3)
Sec. 16-142.3. Required distributions.
(a) A person who would be eligible to receive a monthly
survivor benefit under this Article but for the fact that the
person has not yet attained age 50, and who has not elected to
receive a lump sum distribution under subsection (a) of Section
16-141, shall be eligible for a monthly distribution under this
subsection (a), provided that the payment of such distribution
is required by federal law.
The distribution shall become payable on (i) July 1, 1987,
(ii) December 1 of the calendar year immediately following the
calendar year in which the member or annuitant died, or (iii)
December 1 of the calendar year in which the deceased member or
annuitant would have attained age 72 70 1/2, whichever occurs
latest, and shall remain payable until the first of the
following to occur: (1) the person becomes eligible to receive
a monthly survivor benefit under this Article; (2) the day
following the date on which the member ceases to be eligible to
receive a monthly survivor benefit upon attainment of age 50,
due to remarriage or death; or (3) the day on which such
distribution ceases to be required by federal law.
The amount of the distribution shall be fixed at the time
the distribution first becomes payable, and shall be calculated
in the same manner as the monthly survivor benefit under

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Sections 16-141, 16-142, 16-142.1 and 16-142.2, but excluding
any automatic annual increases, supplemental increases, or
one-time increases that may be provided by law for monthly
survivor benefits.
(b) For the purpose of this Section, a distribution shall
be deemed to be required by federal law if: (1) directly
mandated by federal statute, rule, or administrative or court
decision; or (2) indirectly mandated through imposition of
substantial tax or other penalties for noncompliance.
(c) Notwithstanding Section 1-103.1 of this Code, a member
need not be in service on or after the effective date of this
amendatory Act of 1989 for the member's surviving spouse to be
eligible for a distribution under this Section.
(Source: P.A. 86-273.)
(40 ILCS 5/18-128.3) (from Ch. 108 1/2, par. 18-128.3)
Sec. 18-128.3. Required distributions. (a) A person who
would be eligible to receive a survivor's annuity under this
Article but for the fact that the person has not yet attained
age 50, shall be eligible for a monthly distribution under this
subsection (a), provided that the payment of such distribution
is required by federal law.
The distribution shall become payable on (i) July 1, 1987,
(ii) December 1 of the calendar year immediately following the
calendar year in which the deceased spouse died, or (iii)
December 1 of the calendar year in which the deceased spouse

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would have attained age 72 70 1/2, whichever occurs last, and
shall remain payable until the first of the following to occur:
(1) the person becomes eligible to receive a survivor's annuity
under this Article; (2) the end of the month in which the
person ceases to be eligible to receive a survivor's annuity
upon attainment of age 50, due to remarriage or death; or (3)
the end of the month in which such distribution ceases to be
required by federal law.
The amount of the distribution shall be fixed at the time
the distribution first becomes payable, and shall be calculated
in the same manner as a survivor's annuity under Sections
18-128 through 18-128.2, but excluding: (A) any requirement for
an application for the distribution; (B) any automatic annual
increases, supplemental increases, or one-time increases that
may be provided by law for survivor's annuities; and (C) any
lump-sum or death benefit.
(b) For the purpose of this Section, a distribution shall
be deemed to be required by federal law if: (1) directly
mandated by federal statute, rule, or administrative or court
decision; or (2) indirectly mandated through imposition of
substantial tax or other penalties for noncompliance.
(c) Notwithstanding Section 1-103.1 of this Code, a member
need not be in service on or after the effective date of this
amendatory Act of 1989 for the member's surviving spouse to be
eligible for a distribution under this Section.
(Source: P.A. 86-273.)

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Section 90. The State Mandates Act is amended by adding
Section 8.44 as follows:
(30 ILCS 805/8.44 new)
Sec. 8.44. 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 101st General Assembly.
Section 99. Effective date. This Act takes effect upon
becoming law.