HB 2452 Summary

• Amends the Illinois Pension Code to create accelerated pension benefit payment options for Tier 1 members in the State Employee, State Universities, and Downstate Teacher pension systems.

• Offers three election options: (1) lump sum payment equal to 60% of pension benefit present value in lieu of all benefits; (2) lump sum payment equal to 70% of the difference between current and reduced automatic annual increases in exchange for lower annual increases (1.5%); and (3) lump sum payment equal to 50% of the difference between pension annuity value and hypothetical Social Security benefits, with retirement annuity reduced to Social Security equivalent amount.

• Elections available until June 30, 2021 for options 1 and 2; option 3 available beginning on implementation date determined by Board resolution.

• Accelerated payments must be transferred to tax-qualified retirement plans or rolled over into other Internal Revenue Code-qualified plans; payments cannot be repaid to the system.

• Contains conforming changes to benefit increase provisions and requires Board rulemaking for implementation, effective immediately upon becoming law.