Bill Text: IL SB2105 | 2021-2022 | 102nd General Assembly | Introduced

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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%. Provides that for Tier 2 policemen, "final average salary" is the greater of: (i) the average monthly salary obtained by dividing the total salary of the policeman during the 96 consecutive months of service within the last 120 months of service in which the total salary was the highest; or (ii) the average monthly salary obtained by dividing the total salary of the policeman during the 48 consecutive months of service within the last 60 months of service in which the total salary was the highest. Provides that the Tier 2 limitation on salary shall annually be increased by the lesser of 3% or the annual (instead of one-half of the annual) unadjusted percentage increase in the consumer price index-u. Provides that the surviving spouse's annuity for certain Tier 2 policemen shall be 54% of the policeman's monthly salary. Makes changes to the benefits paid to the guardian or surviving spouse of a deceased Tier 2 policeman if the policeman was the parent of a child. Makes other changes. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Introduced - Dead) 2022-08-09 - Added as Chief Co-Sponsor Sen. Bill Cunningham [SB2105 Detail]

Download: Illinois-2021-SB2105-Introduced.html

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102ND GENERAL ASSEMBLY State of Illinois 2021 and 2022 SB2105 Introduced 2/26/2021, by Sen. Robert F. Martwick SYNOPSIS AS INTRODUCED:
40 ILCS 5/5-167.1 from Ch. 108 1/2, par. 5-167.1
40 ILCS 5/5-238
30 ILCS 805/8.45 new
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%. Provides that for Tier 2 policemen, "final average salary" is the greater of: (i) the average monthly salary obtained by dividing the total salary of the policeman during the 96 consecutive months of service within the last 120 months of service in which the total salary was the highest; or (ii) the average monthly salary obtained by dividing the total salary of the policeman during the 48 consecutive months of service within the last 60 months of service in which the total salary was the highest. Provides that the Tier 2 limitation on salary shall annually be increased by the lesser of 3% or the annual (instead of one-half of the annual) unadjusted percentage increase in the consumer price index-u. Provides that the surviving spouse's annuity for certain Tier 2 policemen shall be 54% of the policeman's monthly salary. Makes changes to the benefits paid to the guardian or surviving spouse of a deceased Tier 2 policeman if the policeman was the parent of a child. Makes other changes. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.
LRB102 12572 RPS 17910 b
FISCAL NOTE ACT MAY APPLY PENSION IMPACT NOTE ACT MAY APPLY STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT
A BILL FOR
SB2105 LRB102 12572 RPS 17910 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 5-167.1 and 5-238 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

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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
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

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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
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

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this amendatory Act.
Any policeman born after 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, 2021 is entitled to receive the initial increase
under this subsection on (1) January 1, 2021, (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 102nd 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

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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.
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

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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.
(Source: P.A. 99-905, eff. 11-29-16.)
(40 ILCS 5/5-238)
Sec. 5-238. Provisions applicable to new hires; Tier 2.
(a) Notwithstanding any other provision of this Article,
the provisions of this Section apply to a person who first
becomes a policeman under this Article on or after January 1,
2011, and to certain qualified survivors of such a policeman.
Such persons, and the benefits and restrictions that apply
specifically to them under this Article, may be referred to as
"Tier 2".

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(b) A policeman who has withdrawn from service, has
attained age 50 or more, and has 10 or more years of service in
that capacity shall be entitled, upon proper application being
received by the Fund, to receive a Tier 2 monthly retirement
annuity for his service as a police officer. The Tier 2 monthly
retirement annuity shall be computed by multiplying 2.5% for
each year of such service by his or her final average salary,
subject to an annuity reduction factor of one-half of 1% for
each month that the police officer's age at retirement is
under age 55. The Tier 2 monthly retirement annuity is in lieu
of any age and service annuity or other form of retirement
annuity under this Article.
The maximum retirement annuity under this subsection (b)
shall be 75% of final average salary.
For the purposes of this subsection (b), "final average
salary" means the greater of: (i) the average monthly salary
obtained by dividing the total salary of the policeman 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; or (ii) the
average monthly salary obtained by dividing the total salary
of the policeman 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.
Beginning on January 1, 2011, for all purposes under this

SB2105 - 8 - LRB102 12572 RPS 17910 b
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)
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.
Nothing in this amendatory Act of the 102nd General
Assembly shall cause or otherwise result in any retroactive
adjustment of any employee contributions.
(c) Notwithstanding any other provision of this Article,
for a person who first becomes a policeman under this Article
on or after January 1, 2011, eligibility for and the amount of
the annuity to which the qualified surviving spouse, children,
and parents are entitled under this subsection (c) shall be
determined as follows:
(1) The surviving spouse of a deceased policeman to
whom this Section applies shall be deemed qualified to
receive a Tier 2 surviving spouse's annuity under this
paragraph (1) if: (i) the deceased policeman meets the
requirements specified under subdivision (A), (B), (C), or
(D) of this paragraph (1); and (ii) the surviving spouse
would not otherwise be excluded from receiving a widow's

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annuity under the eligibility requirements for a widow's
annuity set forth in Section 5-146. The Tier 2 surviving
spouse's annuity is in lieu of the widow's annuity
determined under any other Section of this Article and is
subject to the requirements of Section 5-147.1.
As used in this subsection (c), "earned annuity" means
a Tier 2 monthly retirement annuity determined under
subsection (b) of this Section, including any increases
the policeman had received pursuant to Section 5-167.1.
(A) If the deceased policeman was receiving an
earned annuity at the date of his or her death, the
Tier 2 surviving spouse's annuity under this paragraph
(1) shall be in the amount of 66 2/3% of the
policeman's earned annuity at the date of death.
If the deceased policeman was a parent of a child
or children, including any child who has been
conceived but not yet born, and there is a surviving
spouse, 12% of the policeman's earned annuity at the
date of death shall be granted to the guardian of any
such minor child or children for each such child until
attainment of age 18. Upon the death of the surviving
spouse leaving one or more children under the age of
18, or upon the death of a policeman leaving one or
more children under the age of 18 but no surviving
spouse, a monthly pension of 20% of the policeman's
monthly salary at the date of death shall be granted to

SB2105 - 10 - LRB102 12572 RPS 17910 b
the duly appointed guardian of each such child for the
support and maintenance of each such child until the
child reaches age 18. The benefit in this paragraph is
in lieu of a benefit under paragraph (2) of this
subsection (c) but does not apply if the beneficiary
is entitled to receive a greater benefit under
paragraph (2) of this subsection (c).
(B) If the deceased policeman was not receiving an
earned annuity but had at least 10 years of service at
the time of death, the Tier 2 surviving spouse's
annuity under this paragraph (1) shall be the greater
of: (i) 30% of the annual maximum salary attached to
the classified civil service position of a first class
patrolman at the time of his death; (ii) 54% of the
policeman's monthly salary at the time of the
policeman's death; or (iii) (ii) 66 2/3% of the Tier 2
monthly retirement annuity that the deceased policeman
would have been eligible to receive under subsection
(b) of this Section, based upon the actual service
accrued through the day before the policeman's death,
but determined as though the policeman was at least
age 55 on the day before his or her death and retired
on that day.
If the deceased policeman was a parent of a child
or children, including any child who has been
conceived but not yet born, and there is a surviving

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spouse, 12% of the policeman's monthly salary at the
date of death shall be granted to the guardian of any
such minor child or children for each such child until
attainment of age 18. Upon the death of the surviving
spouse leaving one or more children under the age of
18, or upon the death of a policeman leaving one or
more children under the age of 18 but no surviving
spouse, a monthly pension of 20% of the policeman's
monthly salary at the date of death 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 benefit in this paragraph is
in lieu of a benefit under paragraph (2) of this
subsection (c) but does not apply if the beneficiary
is entitled to receive a greater benefit under
paragraph (2) of this subsection (c).
(C) If the deceased policeman was an active
policeman with at least 1 1/2 but less than 10 years of
service at the time of death, the Tier 2 surviving
spouse's annuity under this paragraph (1) shall be the
greater of: (i) in the amount of 30% of the annual
maximum salary attached to the classified civil
service position of a first class patrolman at the
time of his death; or (ii) 54% of the policeman's
monthly salary at the time of the policeman's death.
If the deceased policeman was a parent of a child

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or children, including any child who has been
conceived but not yet born, and there is a surviving
spouse, 12% of the policeman's monthly salary at the
date of death shall be granted to the guardian of any
such minor child or children for each such child until
attainment of age 18. Upon the death of the surviving
spouse leaving one or more children under the age of
18, or upon the death of a policeman leaving one or
more children under the age of 18 but no surviving
spouse, a monthly pension of 20% of the policeman's
monthly salary at the date of death 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 benefit in this paragraph is
in lieu of a benefit under paragraph (2) of this
subsection (c) but does not apply if the beneficiary
is entitled to receive a greater benefit under
paragraph (2) of this subsection (c).
(D) If the performance of an act or acts of duty
results directly in the death of a policeman subject
to this Section, or prevents him from subsequently
resuming active service in the police department, and
if the policeman's Tier 2 surviving spouse would
otherwise meet the eligibility requirements for a
compensation annuity or supplemental annuity granted
under Section 5-144, then in addition to the Tier 2

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surviving spouse's annuity provided under subdivision
(A), (B), or (C) of this paragraph (1), whichever
applies, the Tier 2 surviving spouse shall be
qualified to receive compensation annuity or
supplemental annuity, as would be provided under
Section 5-144, in order to bring the total benefit up
to the applicable 75% salary limitation provided in
that Section, but subject to the Tier 2 salary cap
provided under subsection (b) of this Section; except
that no such annuity shall be paid to the surviving
spouse of a policeman who dies while in receipt of
disability benefits when the policeman's death was
caused by an intervening illness or injury unrelated
to the illness or injury that had prevented him from
subsequently resuming active service in the police
department.
(E) Notwithstanding any other provision of this
Article, the monthly Tier 2 surviving spouse's annuity
under subdivision (A) or (B) of this paragraph (1)
shall be increased on the January 1 next occurring
after (i) attainment of age 60 by the recipient of the
Tier 2 surviving spouse's annuity or (ii) the first
anniversary of the Tier 2 surviving spouse's annuity
start date, whichever is later, and on each January 1
thereafter, by 3% or one-half the annual unadjusted
percentage increase (but not less than zero) in the

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consumer price index-u for the 12 months ending with
the September preceding each November 1, whichever is
less, of the originally granted Tier 2 surviving
spouse's annuity. If the 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 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.
(F) Notwithstanding the other provisions of this
paragraph (1), for a qualified surviving spouse who is
entitled to a Tier 2 surviving spouse's annuity under
subdivision (A), (B), (C), or (D) of this paragraph
(1), that Tier 2 surviving spouse's annuity shall not
be less than the amount of the minimum widow's annuity
established from time to time under Section 5-167.4.
(2) Surviving children of a deceased policeman subject

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to this Section who would otherwise meet the eligibility
requirements for a child's annuity set forth in Sections
5-151 and 5-152 shall be deemed qualified to receive a
Tier 2 child's annuity under this subsection (c), which
shall be in lieu of, but in the same amount and paid in the
same manner as, the child's annuity provided under those
Sections; except that any salary used for computing a Tier
2 child's annuity shall be subject to the Tier 2 salary cap
provided under subsection (b) of this Section. For
purposes of determining any pro rata reduction in child's
annuities under this subsection (c), references in Section
5-152 to the combined annuities of the family shall be
deemed to refer to the combined Tier 2 surviving spouse's
annuity, if any, and the Tier 2 child's annuities payable
under this subsection (c).
(3) Surviving parents of a deceased policeman subject
to this Section who would otherwise meet the eligibility
requirements for a parent's annuity set forth in Section
5-152 shall be deemed qualified to receive a Tier 2
parent's annuity under this subsection (c), which shall be
in lieu of, but in the same amount and paid in the same
manner as, the parent's annuity provided under Section
5-152.1; except that any salary used for computing a Tier
2 parent's annuity shall be subject to the Tier 2 salary
cap provided under subsection (b) of this Section. For the
purposes of this Section, a reference to "annuity" in

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Section 5-152.1 includes: (i) in the context of a widow, a
Tier 2 surviving spouse's annuity and (ii) in the context
of a child, a Tier 2 child's annuity.
Notwithstanding Section 1-103.1, the changes made to this
subsection by this amendatory Act of the 102nd General
Assembly apply without regard to whether the deceased
policeman was in service on or after the effective date of this
amendatory Act of the 102nd General Assembly. The changes made
by this amendatory Act of the 102nd General Assembly shall not
diminish the survivor's benefits described in this Section.
(d) The General Assembly finds and declares that the
provisions of this Section, as enacted by Public Act 96-1495,
require clarification relating to necessary eligibility
standards and the manner of determining and paying the
intended Tier 2 benefits and contributions in order to enable
the Fund to unambiguously implement and administer benefits
for Tier 2 members. The changes to this Section and the
conforming changes to Sections 5-153, 5-155, 5-163, 5-167.1
(except for the changes to subsection (a) of that Section),
5-169, and 5-170 made by this amendatory Act of the 99th
General Assembly are enacted to clarify the provisions of this
Section as enacted by Public Act 96-1495, and are hereby
declared to represent and be consistent with the original and
continuing intent of this Section and Public Act 96-1495.
(e) The changes to Sections 5-153, 5-155, 5-163, 5-167.1
(except for the changes to subsection (a) of that Section),

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5-169, and 5-170 made by this amendatory Act of the 99th
General Assembly are intended to be retroactive to January 1,
2011 (the effective date of Public Act 96-1495) and, for the
purposes of Section 1-103.1 of this Code, they apply without
regard to whether the relevant policeman was in service on or
after the effective date of this amendatory Act of the 99th
General Assembly.
(Source: P.A. 99-905, eff. 11-29-16.)
Section 90. The State Mandates Act is amended by adding
Section 8.45 as follows:
(30 ILCS 805/8.45 new)
Sec. 8.45. 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 102nd General Assembly.
Section 99. Effective date. This Act takes effect upon
becoming law.