Bill Text: IL SB2826 | 2025-2026 | 104th General Assembly | Enrolled

---

Bill Title: Reinserts the provisions of the introduced bill with the following changes. Further amends the Illinois Municipal Retirement Fund (IMRF) Article of the Illinois Pension Code. Provides that a participating employee who, regardless of cause, is separated from the service of the participating municipalities and instrumentalities thereof and participating instrumentalities from which the participating employee is seeking to retire (instead of all participating municipalities and instrumentalities thereof and participating instrumentalities) shall be entitled to a retirement annuity if the participating employee meets certain conditions. Provides that a condition of entitlement to a retirement annuity is that the participating employee is not entitled to receive earnings for employment in a position requiring him to be a participating employee as defined in the Article or under a provision concerning the suspension of a retirement annuity during employment (instead of employment in a position requiring him or entitling him to elect to be a participating employee). Adds a condition for entitlement to a retirement annuity that the participating employee has not prearranged to return to the service of the participating municipalities and instrumentalities thereof and participating instrumentalities from which the participating employee retired. In a provision concerning eligibility for separation benefits, adds a condition that the participant must have separated from the service of the participating municipality or instrumentality with which the participating employee last participated in the Fund. Removes language providing that the entitlement to a separation benefit is upon separation from the service of all participating municipalities and instrumentalities thereof and participating instrumentalities.

Sponsorship: Moderate Partisan Bill (Democrat 4-1)

Status: (Enrolled) 2026-05-21 - Passed Both Houses [SB2826 Detail]

Download: Illinois-2025-SB2826-Enrolled.html

---

SB2826 Enrolled LRB104 17390 RPS 30815 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 7-141, 7-166, and 7-174 as follows:
(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 the all participating
municipalities and instrumentalities thereof and participating
instrumentalities from which the participating employee is
seeking to retire shall be entitled to a retirement annuity
provided:
1. He is at least age 55 if he is a Tier 1 regular
employee, he is age 62 if he is a Tier 2 regular employee,
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 as defined in
Section 7-137 or under subsection (a) of Section 7-144;

SB2826 Enrolled - 2 - LRB104 17390 RPS 30815 b
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 and is a Tier 1 regular employee, he has
at least 8 years of service, or, if he is a Tier 2 regular
member, he has at least 10 years of service. This service
requirement shall not apply to any participating employee,
regardless of participation date, if the General Assembly
terminates the Fund; .
5. He has not prearranged to return to the service of
the participating municipalities and instrumentalities
thereof and participating instrumentalities from which the
participating employee retired.
(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, if the member (i) is no longer in
service, and (ii) is otherwise entitled to an annuity
under this Article;
4. To the beneficiary of the deceased annuitant for

SB2826 Enrolled - 3 - LRB104 17390 RPS 30815 b
the unpaid amount accrued to date of death, if any.
(Source: P.A. 102-210, Article 5, Section 5-5, eff. 7-30-21;
102-210, Article 10, Section 10-5, eff. 1-1-22; 102-813, eff.
5-13-22.)
(40 ILCS 5/7-166) (from Ch. 108 1/2, par. 7-166)
Sec. 7-166. Separation benefits; eligibility benefits -
eligibility. Separation benefits shall be payable as
hereinafter set forth:
1. Any Upon separation from the service of all
participating municipalities and instrumentalities
thereof and participating instrumentalities, any
participating employee who, on the date of application for
such benefit, is not entitled to a retirement annuity and
has separated from the service of the participating
municipality or instrumentality with which the
participating employee last participated in the Fund shall
be entitled to a separation benefit.
2. Any Upon separation from the service of all
participating municipalities and instrumentalities
thereof and participating instrumentalities, any
participating employee who, on the date of application for
such benefit, is entitled to a retirement annuity of less
than $100 per month for life and has separated from the
service of the participating municipality or
instrumentality with which the participating employee last

SB2826 Enrolled - 4 - LRB104 17390 RPS 30815 b
participated in the Fund may elect to take a separation
benefit in lieu of the retirement annuity.
3. Any Upon separation from the service of all
participating municipalities and instrumentalities
thereof and participating instrumentalities, any
participating employee who, on the date of application for
such benefit, is entitled to a retirement annuity, but
wishes instead to use the amounts to his or her credit in
the Fund to purchase credit in another retirement plan,
and has separated from the service of the participating
municipality or instrumentality with which the
participating employee last participated in the Fund may
elect to take a separation benefit in lieu of the
retirement annuity.
(Source: P.A. 99-747, eff. 1-1-17.)
(40 ILCS 5/7-174) (from Ch. 108 1/2, par. 7-174)
Sec. 7-174. Board created.
(a) A board of 8 members shall constitute a board of
trustees authorized to carry out the provisions of this
Article. Each trustee shall be a participating employee of a
participating municipality or participating instrumentality or
an annuitant of the Fund and no person shall be eligible to
become a trustee after January 1, 1979 who does not have the
minimum service credit in this Fund to qualify for a pension.
Notwithstanding any other provision of this subsection, on

SB2826 Enrolled - 5 - LRB104 17390 RPS 30815 b
and after the effective date of this amendatory Act of the
104th General Assembly, no person who has earned creditable
service through employment by the Fund shall be eligible to
serve as a trustee.
(b) The board shall consist of representatives of various
groups as follows:
1. 4 trustees shall be a chief executive officer,
chief finance officer, or other officer, executive or
department head of a participating municipality or
participating instrumentality, and each such trustee shall
be designated as an executive trustee.
2. 3 trustees shall be employees of a participating
municipality or participating instrumentality and each
such trustee shall be designated as an employee trustee. A
person who meets the criteria to be an executive trustee
may not serve as an employee trustee.
3. One trustee shall be an annuitant of the Fund, who
shall be designated the annuitant trustee.
(c) A person elected as a trustee shall qualify as a
trustee, after declaration by the board that he has been duly
elected, upon taking and subscribing to the constitutional
oath of office and filing same in the office of the Fund.
(d) The term of office of each trustee shall begin upon
January 1 of the year following the year in which he is elected
and shall continue for a period of 5 years and until a
successor has been elected and qualified, or until prior

SB2826 Enrolled - 6 - LRB104 17390 RPS 30815 b
resignation, death, incapacity or disqualification.
(e) Any elected trustee (other than the annuitant trustee)
shall be disqualified immediately upon termination of
employment with all participating municipalities and
instrumentalities thereof or upon any change in status which
removes any such trustee from all employments within the group
he represents. The annuitant trustee shall be disqualified
upon termination of his or her annuity.
(e-5) Notwithstanding any other provision, an elected
trustee shall not be considered disqualified due to
termination of participation under subsection (e) if:
(1) he or she thereafter begins participation with a
different participating employer;
(2) there is no gap in service credit established
under this Article; and
(3) the trustee continues to meet all eligibility
requirements under subsection (b) for the same type of
trustee position.
(f) The trustees shall fill any vacancy in the board by
appointment, for the period until the next election of
trustees, or, if the remaining term is less than 2 years, for
the remainder of the term, and until his successor has been
elected and qualified.
(g) Trustees shall serve without compensation, but shall
be reimbursed for any reasonable expenses incurred in
attending meetings of the board and in performing duties on

SB2826 Enrolled - 7 - LRB104 17390 RPS 30815 b
behalf of the Fund and for the amount of any earnings withheld
by any employing municipality or participating instrumentality
because of attendance at any board meeting.
(h) Each trustee shall be entitled to one vote on any and
all actions before the board. At least 5 concurring votes
shall be necessary for every decision or action by the board at
any of its meetings. No decision or action shall become
effective unless presented and so approved at a regular or
duly called special meeting of the board.
(Source: P.A. 102-479, eff. 8-20-21; 103-464, eff. 8-4-23.)