101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB2110

 

Introduced 2/15/2019, by Sen. Dan McConchie

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/4-117  from Ch. 108 1/2, par. 4-117
40 ILCS 5/4-117.2 new
30 ILCS 805/8.43 new

    Amends the Downstate Firefighter Article of the Illinois Pension Code. Requires each municipality to establish a defined contribution plan that aggregates firefighter and employer contributions in individual accounts used for retirement. Provides that if a firefighter who has more than 10 years of creditable service in a fund enters active service with a different municipality, he or she may elect to participate in the defined contribution plan in lieu of the defined benefit plan. Provides that if a fire chief to whom a specified provision of the Illinois Municipal Code applies (i) first becomes a member on or after January 1, 2020, (ii) is receiving pension payments, and (iii) reenters active service with any municipality that has established a pension fund under the Article, that fire chief may continue to receive pension payments while he or she is in active service, but shall only participate in a defined contribution plan and may not establish creditable service in the pension fund established by that municipality or have his or her pension recomputed. Makes other changes. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.


LRB101 11035 RPS 56236 b

FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT

 

 

A BILL FOR

 

SB2110LRB101 11035 RPS 56236 b

1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by changing
5Section 4-117 and by adding Section 4-117.2 as follows:
 
6    (40 ILCS 5/4-117)  (from Ch. 108 1/2, par. 4-117)
7    Sec. 4-117. Reentry into active service.
8    (a) If a firefighter receiving pension payments reenters
9active service, pension payments shall be suspended while he or
10she is in service. If the firefighter again retires or is
11discharged, his or her monthly pension shall be resumed in the
12same amount as was paid upon first retirement or discharge
13unless he or she remained in active service 3 or more years
14after re-entry in which case the monthly pension shall be based
15on the salary attached to the firefighter's rank at the date of
16last retirement.
17    (b) If a deferred pensioner re-enters active service, and
18again retires or is discharged from the fire service, his or
19her pension shall be based on the salary attached to the rank
20held in the fire service at the date of earlier retirement,
21unless the firefighter remains in active service for 3 or more
22years after re-entry, in which case the monthly pension shall
23be based on the salary attached to the firefighter's rank at

 

 

SB2110- 2 -LRB101 11035 RPS 56236 b

1the date of last retirement.
2    (c) If a pensioner or deferred pensioner re-enters or is
3recalled to active service and is thereafter injured, and the
4injury is not related to an injury for which he or she was
5previously receiving a disability pension, the 3 year service
6requirement shall not apply in order for the firefighter to
7qualify for the increased pension based on the rate of pay at
8the time of the new injury.
9    (d) If a fire chief to whom Section 10-1-7.3 of the
10Illinois Municipal Code applies (i) first becomes a member on
11or after January 1, 2020, (ii) is receiving pension payments,
12and (iii) reenters active service with any municipality that
13has established a pension fund under this Article, that fire
14chief may continue to receive pension payments while he or she
15is in active service, but shall only participate in a defined
16contribution plan established by the municipality pursuant to
17Section 4-117.2 and may not establish creditable service in the
18pension fund established by that municipality or have his or
19her pension recomputed.
20(Source: P.A. 83-1440.)
 
21    (40 ILCS 5/4-117.2 new)
22    Sec. 4-117.2. Defined contribution plan for certain
23firefighters.
24    (a) Each municipality shall establish a defined
25contribution plan that aggregates firefighter and employer

 

 

SB2110- 3 -LRB101 11035 RPS 56236 b

1contributions in individual accounts used for retirement. The
2defined contribution plan, including both firefighter and
3employer contributions, established by the municipality must,
4at a minimum: meet the safe harbor provisions of the Internal
5Revenue Code of 1986, as amended; be a qualified plan under the
6Internal Revenue Code of 1986, as amended; and comply with all
7other applicable laws, rules, and regulations. Contributions
8shall vest immediately upon deposit in the firefighter's
9account.
10    A firefighter who participates in the defined contribution
11plan under this Section may not earn creditable service or
12otherwise participate in the defined benefit plan offered by
13his or her employing municipality, except as an annuitant in
14another fund or as a survivor, while he or she is a participant
15in the defined contribution plan. The defined contribution plan
16under this Section shall not be construed to be a pension,
17annuity, or other defined benefit under this Code.
18    (b) If a firefighter who has more than 10 years of
19creditable service in a fund enters active service with a
20different municipality, he or she may elect to participate in
21the defined contribution plan under this Section in lieu of the
22defined benefit plan.
23    A firefighter who has elected under this subsection to
24participate in the defined contribution plan may, in writing,
25rescind that election in accordance with the rules of the
26board. Any employer contributions, and the earnings thereon,

 

 

SB2110- 4 -LRB101 11035 RPS 56236 b

1shall remain vested in the firefighter's account. A firefighter
2who rescinds the election may begin participating in the
3defined benefit plan on the first day of the month following
4the rescission.
5    (c) As used in this Section, "defined benefit plan" means
6the retirement plan available to firefighters under this
7Article who do not participate in the defined contribution plan
8under this Section.
 
9    Section 90. The State Mandates Act is amended by adding
10Section 8.43 as follows:
 
11    (30 ILCS 805/8.43 new)
12    Sec. 8.43. Exempt mandate. Notwithstanding Sections 6 and 8
13of this Act, no reimbursement by the State is required for the
14implementation of any mandate created by this amendatory Act of
15the 101st General Assembly.
 
16    Section 99. Effective date. This Act takes effect upon
17becoming law.