summary
Introduced
02/05/2025
02/05/2025
In Committee
02/24/2026
02/24/2026
Crossed Over
Passed
Dead
Introduced Session
104th General Assembly
Bill Summary
Amends the Illinois Pension Code. Creates the Deferred Retirement Option Article. Provides a deferred retirement option plan (DROP) for certain participants under the Downstate Teacher Article who are eligible to retire and meet other criteria. Provides that a participant in the DROP may elect to participate for up to 5 years. Provides that on the effective date of the member's election, the System shall credit the member's account on a monthly basis, for as long as the member participates in the DROP, an amount equal to the monthly amount of retirement annuity the member would otherwise be eligible to receive had the member retired on the date of the election. Provides that the DROP member shall be considered in active service for purposes of participation in a collective bargaining agreement, for health care benefits, and for other purposes. Establishes a DROP administered by the State Treasurer for pension funds or retirement systems that are required to establish a DROP and elect to transfer administrative responsibility for the DROP to the State Treasurer. Sets forth provisions concerning interest on the account; termination of the DROP; contributions; administrative costs; and a DROP advisory board. Effective immediately.
AI Summary
This bill creates a Deferred Retirement Option Plan (DROP) for eligible downstate teachers in Illinois, allowing participants who are eligible for retirement to elect to participate in the program for up to 5 years while continuing to work. During the DROP period, the retirement system will credit the member's account monthly with the retirement annuity amount they would have received if they had retired on the date of their DROP election. Participants will be considered in active service for collective bargaining and health care benefits, but will not accrue additional service credit. The DROP member must terminate employment upon expiration of their participation, which cannot extend beyond January 1, 2033. The account balance will be paid as a lump sum upon termination, and interest will be calculated annually based on the 10-year Treasury rate. The bill allows the retirement system's board of trustees to transfer administrative responsibility for the DROP to the State Treasurer, who will establish an advisory board and administer the program. The legislation is designed to provide an alternative retirement benefit option for eligible teachers while ensuring compliance with federal tax laws and maintaining the pension system's financial integrity.
Committee Categories
Budget and Finance
Sponsors (1)
Last Action
Assigned to Appropriations-Pensions & Personnel (on 02/24/2026)
bill text
bill summary
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bill summary
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bill summary
| Document Type | Source Location |
|---|---|
| State Bill Page | https://www.ilga.gov/legislation/BillStatus.asp?DocNum=2765&GAID=18&DocTypeID=HB&SessionID=114&GA=104 |
| BillText | https://www.ilga.gov/legislation/104/HB/10400HB2765.htm |
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