SB 2026 Summary

• Adds new Section 1-161 to Illinois Pension Code establishing restrictions on pension benefits for active participants in state-funded retirement systems effective upon passage.

• Prohibits active participants from accruing additional service credit and freezes their pensionable salary at the level as of the bill's effective date.

• Eliminates automatic increases in retirement annuities for current annuitants beginning on the effective date.

• Increases retirement age requirements: new participants must reach Social Security Normal Retirement Age; current participants ineligible to retire must reach age 59 minimum, with a schedule developed by the Public Pension Division.

• Requires all state-funded retirement systems to establish self-directed retirement plans allowing participants to accumulate assets through employee and employer contributions (8% employee/7% employer for most; 3% each for certain covered employees) invested in mutual funds or annuity contracts.