SB 1956

Abstract

Amends the Chicago Police Article of the Illinois Pension Code. Provides that, in those cases where the injury or death for which a disability or death benefit is payable was caused under circumstances creating a legal liability on the part of some person or entity to pay damages to the policeman, then legal proceedings may be taken against such other person or entity to recover damages notwithstanding the Fund's payment of or liability to pay disability or death benefits. Provides that the Fund may intervene in any action brought by the disabled policeman or his or her personal representative. Effective immediately. House Committee Amendment No. 2 Adds reference to: 40 ILCS 5/3-144.3 new 40 ILCS 5/4-138.15 new 40 ILCS 5/5-167.1 from Ch. 108 1/2, par. 5-167.1 40 ILCS 5/6-235 new 30 ILCS 805/8.47 new Replaces everything after the enacting clause. Amends the Illinois Pension Code. Provides that the Retirement Systems Reciprocal Act (Article 20 of the Code) is adopted and made a part of the Downstate Police, Downstate Firefighter, Chicago Police, and Chicago Firefighter Articles, but only with respect to a person who, on or after the effective date of the amendatory Act, is entitled under those Articles or through a participating system under the Retirement Systems Reciprocal Act to begin receiving a retirement annuity or survivor's annuity and who elects to proceed under the Retirement Systems Reciprocal Act. In the Chicago Police Article of the 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% and specifies the timing of an initial increase in retirement annuity for persons who have not received the initial increase before January 1, 2023. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately. Pension Note (Government Forecasting & Accountability) SB 1956, as amended by HA 001, would grant an annual 3% non-compounded cost-of-living adjustment (COLA) to all Tier 1 Chicago Police retirees who reach age 55 with 20 years of service. This change would have a significant fiscal impact upon the pension fund. An actuarial study would be required to determine the precise fiscal impact. As of December 31, 2021, the pension fund had an unfunded liability of approximately $12 billion, and a funded ratio of 24.9%. Regarding the expansion of reciprocal service, CGFA staff has consulted with the systems most likely to have members who would receive reciprocal annuities comprised of service with the Chicago Police, Chicago Fire, and the Downstate Fire pension funds. IMRF and SERS do not anticipate a significant actuarial cost due to bringing these funds under the ambit of the Reciprocal Act. The Cook County Pension Fund says that some increased liability is possible, but the extent of the increase cannot be known as the number of members who would receive proportional annuities between the impacted funds is not known. Fiscal Note (Department of Insurance) This legislation poses no impact, fiscal or otherwise to the Department of Insurance. House Floor Amendment No. 3 Deletes reference to: 40 ILCS 5/3-144.3 new 40 ILCS 5/4-138.15 new 40 ILCS 5/5-240 new 40 ILCS 5/6-235 new Replaces everything after the enacting clause. Reinserts the provisions of the introduced bill with the following changes. Makes a change in a provision concerning eligibility for receiving an initial increase in retirement annuity for persons who have not received an initial increase. Removes provisions adopting the Retirement Systems Reciprocal Act (Article 20 of the Illinois Pension Code) for the Downstate Police, Downstate Firefighter, Chicago Police, and Chicago Firefighter Articles of the Illinois Pension Code.