HB5625 Summary: Pension Buyout Act

• Creates the Pension Buyout Act authorizing the Department of Central Management Services to contract with approved vendors to provide lump sum payments to eligible retirees in the General Assembly, State Employee, State Universities, and Judges Retirement Systems.

• Eligible retirees can relinquish all pension rights and benefits in exchange for a lump sum payment equal to the present value of their retirement annuity, calculated using the system's actuarial tables.

• Requires approved vendors to provide certified financial planning services at no cost to eligible retirees before they elect the pension buyout option.

• Authorizes the Illinois Finance Authority to issue bonds up to $500 million if appropriations are insufficient to cover lump sum payments to approved vendors.

• Participants who accept pension buyouts are deemed annuitants for purposes of the State Employees Group Insurance Act of 1971 and retain eligibility for group health insurance benefits.

• Effective date: July 1, 2017.