SB0662 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 exchange for relinquishing all pension rights and benefits under the General Assembly, State Employee, State Universities, and Judges Retirement Systems.

• Eligible retirees receive a one-time lump sum payment equal to the present value of their retirement annuity (calculated using actuarial tables adopted by each retirement system's Board) and must receive minimum certified financial planning services before participating.

• Requires Illinois Finance Authority to issue bonds up to $500,000,000 if annual appropriations are insufficient to cover pension buyout payments, with bond proceeds used solely for vendor payments.

• Participating retirees lose all pension system rights and service credits but remain eligible for health insurance benefits under the State Employees Group Insurance Act of 1971 as annuitants.

• Takes effect July 1, 2018 and requires Department of Central Management Services to adopt implementing rules for vendor contracts, financial planning requirements, and reporting procedures.