Illinois 2025-2026 Regular Session

Illinois House Bill HB2796 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB2796 Introduced , by Rep. Janet Yang Rohr SYNOPSIS AS INTRODUCED: 40 ILCS 5/4-105e new40 ILCS 5/4-109 from Ch. 108 1/2, par. 4-10940 ILCS 5/4-109.1 from Ch. 108 1/2, par. 4-109.140 ILCS 5/4-109.4 new30 ILCS 805/8.49 new Amends the Downstate Firefighter Article of the Pension Code. Provides for a Deferred Retirement Option Plan, under which a firefighter who is at least age 50 with 20 years of service may continue in active service for up to 3 years while having his or her retirement pension paid into a special account, to be distributed to the firefighter upon retirement. Bases the retirement pension on the firefighter's service and salary at the time of joining the DROP plan. Requires termination of service at the end of the DROP plan participation period. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately. LRB104 11487 RPS 21576 b STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY A BILL FOR 104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB2796 Introduced , by Rep. Janet Yang Rohr SYNOPSIS AS INTRODUCED: 40 ILCS 5/4-105e new40 ILCS 5/4-109 from Ch. 108 1/2, par. 4-10940 ILCS 5/4-109.1 from Ch. 108 1/2, par. 4-109.140 ILCS 5/4-109.4 new30 ILCS 805/8.49 new 40 ILCS 5/4-105e new 40 ILCS 5/4-109 from Ch. 108 1/2, par. 4-109 40 ILCS 5/4-109.1 from Ch. 108 1/2, par. 4-109.1 40 ILCS 5/4-109.4 new 30 ILCS 805/8.49 new Amends the Downstate Firefighter Article of the Pension Code. Provides for a Deferred Retirement Option Plan, under which a firefighter who is at least age 50 with 20 years of service may continue in active service for up to 3 years while having his or her retirement pension paid into a special account, to be distributed to the firefighter upon retirement. Bases the retirement pension on the firefighter's service and salary at the time of joining the DROP plan. Requires termination of service at the end of the DROP plan participation period. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately. LRB104 11487 RPS 21576 b LRB104 11487 RPS 21576 b STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY A BILL FOR
2	2	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB2796 Introduced , by Rep. Janet Yang Rohr SYNOPSIS AS INTRODUCED:
3	3	40 ILCS 5/4-105e new40 ILCS 5/4-109 from Ch. 108 1/2, par. 4-10940 ILCS 5/4-109.1 from Ch. 108 1/2, par. 4-109.140 ILCS 5/4-109.4 new30 ILCS 805/8.49 new 40 ILCS 5/4-105e new 40 ILCS 5/4-109 from Ch. 108 1/2, par. 4-109 40 ILCS 5/4-109.1 from Ch. 108 1/2, par. 4-109.1 40 ILCS 5/4-109.4 new 30 ILCS 805/8.49 new
4	4	40 ILCS 5/4-105e new
5	5	40 ILCS 5/4-109 from Ch. 108 1/2, par. 4-109
6	6	40 ILCS 5/4-109.1 from Ch. 108 1/2, par. 4-109.1
7	7	40 ILCS 5/4-109.4 new
8	8	30 ILCS 805/8.49 new
9	9	Amends the Downstate Firefighter Article of the Pension Code. Provides for a Deferred Retirement Option Plan, under which a firefighter who is at least age 50 with 20 years of service may continue in active service for up to 3 years while having his or her retirement pension paid into a special account, to be distributed to the firefighter upon retirement. Bases the retirement pension on the firefighter's service and salary at the time of joining the DROP plan. Requires termination of service at the end of the DROP plan participation period. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.
10	10	LRB104 11487 RPS 21576 b LRB104 11487 RPS 21576 b
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12	12	STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY
13	13	STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY
14	14	A BILL FOR
15	15	HB2796LRB104 11487 RPS 21576 b HB2796 LRB104 11487 RPS 21576 b
16	16	HB2796 LRB104 11487 RPS 21576 b
17	17	1 AN ACT concerning public employee benefits.
18	18	2 Be it enacted by the People of the State of Illinois,
19	19	3 represented in the General Assembly:
20	20	4 Section 5. The Illinois Pension Code is amended by adding
21	21	5 Sections 4-105e and 4-109.4 and changing Sections 4-109 and
22	22	6 4-109.1 as follows:
23	23	7 (40 ILCS 5/4-105e new)
24	24	8 Sec. 4-105e. Deferred Retirement Option Plan. "Deferred
25	25	9 Retirement Option Plan" or "DROP plan" means the Deferred
26	26	10 Retirement Option Plan established under Section 4-109.3.
27	27	11 (40 ILCS 5/4-109) (from Ch. 108 1/2, par. 4-109)
28	28	12 Sec. 4-109. Pension.
29	29	13 (a) A firefighter age 50 or more with 20 or more years of
30	30	14 creditable service, who is no longer in service as a
31	31	15 firefighter, shall receive a monthly pension of 1/2 the
32	32	16 monthly salary attached to the rank held by him or her in the
33	33	17 fire service at the date of retirement.
34	34	18 The monthly pension shall be increased by 1/12 of 2.5% of
35	35	19 such monthly salary for each additional month over 20 years of
36	36	20 service through 30 years of service, to a maximum of 75% of
37	37	21 such monthly salary.
38	38	22 The changes made to this subsection (a) by this amendatory
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42	42	104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB2796 Introduced , by Rep. Janet Yang Rohr SYNOPSIS AS INTRODUCED:
43	43	40 ILCS 5/4-105e new40 ILCS 5/4-109 from Ch. 108 1/2, par. 4-10940 ILCS 5/4-109.1 from Ch. 108 1/2, par. 4-109.140 ILCS 5/4-109.4 new30 ILCS 805/8.49 new 40 ILCS 5/4-105e new 40 ILCS 5/4-109 from Ch. 108 1/2, par. 4-109 40 ILCS 5/4-109.1 from Ch. 108 1/2, par. 4-109.1 40 ILCS 5/4-109.4 new 30 ILCS 805/8.49 new
44	44	40 ILCS 5/4-105e new
45	45	40 ILCS 5/4-109 from Ch. 108 1/2, par. 4-109
46	46	40 ILCS 5/4-109.1 from Ch. 108 1/2, par. 4-109.1
47	47	40 ILCS 5/4-109.4 new
48	48	30 ILCS 805/8.49 new
49	49	Amends the Downstate Firefighter Article of the Pension Code. Provides for a Deferred Retirement Option Plan, under which a firefighter who is at least age 50 with 20 years of service may continue in active service for up to 3 years while having his or her retirement pension paid into a special account, to be distributed to the firefighter upon retirement. Bases the retirement pension on the firefighter's service and salary at the time of joining the DROP plan. Requires termination of service at the end of the DROP plan participation period. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.
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51	51	LRB104 11487 RPS 21576 b
52	52	STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY
53	53	STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY
54	54	A BILL FOR
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60	60	40 ILCS 5/4-105e new
61	61	40 ILCS 5/4-109 from Ch. 108 1/2, par. 4-109
62	62	40 ILCS 5/4-109.1 from Ch. 108 1/2, par. 4-109.1
63	63	40 ILCS 5/4-109.4 new
64	64	30 ILCS 805/8.49 new
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87	87	1 Act of the 91st General Assembly apply to all pensions that
88	88	2 become payable under this subsection on or after January 1,
89	89	3 1999. All pensions payable under this subsection that began on
90	90	4 or after January 1, 1999 and before the effective date of this
91	91	5 amendatory Act shall be recalculated, and the amount of the
92	92	6 increase accruing for that period shall be payable to the
93	93	7 pensioner in a lump sum.
94	94	8 For a firefighter who retires at the conclusion of
95	95	9 participation in the DROP plan, calculation of the amount of
96	96	10 the retirement pension shall be based on the firefighter's
97	97	11 salary and accumulated service on the date he or she began
98	98	12 participation in the DROP plan and shall include any annual
99	99	13 increases that would have accrued under Section 4-109.1 if the
100	100	14 firefighter had retired on that date.
101	101	15 (b) A firefighter who retires or is separated from service
102	102	16 having at least 10 but less than 20 years of creditable
103	103	17 service, who is not entitled to receive a disability pension,
104	104	18 and who did not apply for a refund of contributions at his or
105	105	19 her last separation from service shall receive a monthly
106	106	20 pension upon attainment of age 60 based on the monthly salary
107	107	21 attached to his or her rank in the fire service on the date of
108	108	22 retirement or separation from service according to the
109	109	23 following schedule:
110	110	24 For 10 years of service, 15% of salary;
111	111	25 For 11 years of service, 17.6% of salary;
112	112	26 For 12 years of service, 20.4% of salary;
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123	123	1 For 13 years of service, 23.4% of salary;
124	124	2 For 14 years of service, 26.6% of salary;
125	125	3 For 15 years of service, 30% of salary;
126	126	4 For 16 years of service, 33.6% of salary;
127	127	5 For 17 years of service, 37.4% of salary;
128	128	6 For 18 years of service, 41.4% of salary;
129	129	7 For 19 years of service, 45.6% of salary.
130	130	8 (c) Notwithstanding any other provision of this Article,
131	131	9 the provisions of this subsection (c) apply to a person who
132	132	10 first becomes a firefighter under this Article on or after
133	133	11 January 1, 2011.
134	134	12 A firefighter age 55 or more who has 10 or more years of
135	135	13 service in that capacity shall be entitled at his option to
136	136	14 receive a monthly pension for his service as a firefighter
137	137	15 computed by multiplying 2.5% for each year of such service by
138	138	16 his or her final average salary.
139	139	17 The pension of a firefighter who is retiring after
140	140	18 attaining age 50 with 10 or more years of creditable service
141	141	19 shall be reduced by one-half of 1% for each month that the
142	142	20 firefighter's age is under age 55.
143	143	21 The maximum pension under this subsection (c) shall be 75%
144	144	22 of final average salary.
145	145	23 For the purposes of this subsection (c), "final average
146	146	24 salary" means the greater of: (i) the average monthly salary
147	147	25 obtained by dividing the total salary of the firefighter
148	148	26 during the 48 consecutive months of service within the last 60
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159	159	1 months of service in which the total salary was the highest by
160	160	2 the number of months of service in that period; or (ii) the
161	161	3 average monthly salary obtained by dividing the total salary
162	162	4 of the firefighter during the 96 consecutive months of service
163	163	5 within the last 120 months of service in which the total salary
164	164	6 was the highest by the number of months of service in that
165	165	7 period.
166	166	8 Beginning on January 1, 2011, for all purposes under this
167	167	9 Code (including without limitation the calculation of benefits
168	168	10 and employee contributions), the annual salary based on the
169	169	11 plan year of a member or participant to whom this Section
170	170	12 applies shall not exceed $106,800; however, that amount shall
171	171	13 annually thereafter be increased by the lesser of (i) 3% of
172	172	14 that amount, including all previous adjustments, or (ii) the
173	173	15 annual unadjusted percentage increase (but not less than zero)
174	174	16 in the consumer price index-u for the 12 months ending with the
175	175	17 September preceding each November 1, including all previous
176	176	18 adjustments.
177	177	19 For a firefighter who retires at the conclusion of
178	178	20 participation in the DROP plan, calculation of the amount of
179	179	21 the retirement pension shall be based on the firefighter's
180	180	22 salary and accumulated service on the date he or she began
181	181	23 participation in the DROP plan and shall include any annual
182	182	24 increases that would have accrued under Section 4-109.1 if the
183	183	25 firefighter had retired on that date.
184	184	26 Nothing in this amendatory Act of the 101st General
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195	195	1 Assembly shall cause or otherwise result in any retroactive
196	196	2 adjustment of any employee contributions.
197	197	3 (Source: P.A. 101-610, eff. 1-1-20.)
198	198	4 (40 ILCS 5/4-109.1) (from Ch. 108 1/2, par. 4-109.1)
199	199	5 Sec. 4-109.1. Increase in pension.
200	200	6 (a) Except as provided in subsection (e), the monthly
201	201	7 pension of a firefighter who retires after July 1, 1971 and
202	202	8 prior to January 1, 1986, shall, upon either the first of the
203	203	9 month following the first anniversary of the date of
204	204	10 retirement if 60 years of age or over at retirement date, or
205	205	11 upon the first day of the month following attainment of age 60
206	206	12 if it occurs after the first anniversary of retirement, be
207	207	13 increased by 2% of the originally granted monthly pension and
208	208	14 by an additional 2% in each January thereafter. Effective
209	209	15 January 1976, the rate of the annual increase shall be 3% of
210	210	16 the originally granted monthly pension.
211	211	17 (b) The monthly pension of a firefighter who retired from
212	212	18 service with 20 or more years of service, on or before July 1,
213	213	19 1971, shall be increased, in January of the year following the
214	214	20 year of attaining age 65 or in January 1972, if then over age
215	215	21 65, by 2% of the originally granted monthly pension, for each
216	216	22 year the firefighter received pension payments. In each
217	217	23 January thereafter, he or she shall receive an additional
218	218	24 increase of 2% of the original monthly pension. Effective
219	219	25 January 1976, the rate of the annual increase shall be 3%.
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230	230	1 (c) The monthly pension of a firefighter who is receiving
231	231	2 a disability pension under this Article shall be increased, in
232	232	3 January of the year following the year the firefighter attains
233	233	4 age 60, or in January 1974, if then over age 60, by 2% of the
234	234	5 originally granted monthly pension for each year he or she
235	235	6 received pension payments. In each January thereafter, the
236	236	7 firefighter shall receive an additional increase of 2% of the
237	237	8 original monthly pension. Effective January 1976, the rate of
238	238	9 the annual increase shall be 3%.
239	239	10 (c-1) On January 1, 1998, every child's disability benefit
240	240	11 payable on that date under Section 4-110 or 4-110.1 shall be
241	241	12 increased by an amount equal to 1/12 of 3% of the amount of the
242	242	13 benefit, multiplied by the number of months for which the
243	243	14 benefit has been payable. On each January 1 thereafter, every
244	244	15 child's disability benefit payable under Section 4-110 or
245	245	16 4-110.1 shall be increased by 3% of the amount of the benefit
246	246	17 then being paid, including any previous increases received
247	247	18 under this Article. These increases are not subject to any
248	248	19 limitation on the maximum benefit amount included in Section
249	249	20 4-110 or 4-110.1.
250	250	21 (c-2) On July 1, 2004, every pension payable to or on
251	251	22 behalf of a minor or disabled surviving child that is payable
252	252	23 on that date under Section 4-114 shall be increased by an
253	253	24 amount equal to 1/12 of 3% of the amount of the pension,
254	254	25 multiplied by the number of months for which the benefit has
255	255	26 been payable. On July 1, 2005, July 1, 2006, July 1, 2007, and
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266	266	1 July 1, 2008, every pension payable to or on behalf of a minor
267	267	2 or disabled surviving child that is payable under Section
268	268	3 4-114 shall be increased by 3% of the amount of the pension
269	269	4 then being paid, including any previous increases received
270	270	5 under this Article. These increases are not subject to any
271	271	6 limitation on the maximum benefit amount included in Section
272	272	7 4-114.
273	273	8 (d) The monthly pension of a firefighter who retires after
274	274	9 January 1, 1986, shall, upon either the first of the month
275	275	10 following the first anniversary of the date of retirement if
276	276	11 55 years of age or over, or upon the first day of the month
277	277	12 following attainment of age 55 if it occurs after the first
278	278	13 anniversary of retirement, be increased by 1/12 of 3% of the
279	279	14 originally granted monthly pension for each full month that
280	280	15 has elapsed since the pension began, and by an additional 3% in
281	281	16 each January thereafter.
282	282	17 The changes made to this subsection (d) by this amendatory
283	283	18 Act of the 91st General Assembly apply to all initial
284	284	19 increases that become payable under this subsection on or
285	285	20 after January 1, 1999. All initial increases that became
286	286	21 payable under this subsection on or after January 1, 1999 and
287	287	22 before the effective date of this amendatory Act shall be
288	288	23 recalculated and the additional amount accruing for that
289	289	24 period, if any, shall be payable to the pensioner in a lump
290	290	25 sum.
291	291	26 For the purpose of calculating eligibility for increases
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302	302	1 under this Section, the date of retirement of a firefighter
303	303	2 who retires at the conclusion of participation in the DROP
304	304	3 plan shall be deemed to be the date he or she began
305	305	4 participation in the DROP plan.
306	306	5 (e) Notwithstanding the provisions of subsection (a), upon
307	307	6 the first day of the month following (1) the first anniversary
308	308	7 of the date of retirement, or (2) the attainment of age 55, or
309	309	8 (3) July 1, 1987, whichever occurs latest, the monthly pension
310	310	9 of a firefighter who retired on or after January 1, 1977 and on
311	311	10 or before January 1, 1986 and did not receive an increase under
312	312	11 subsection (a) before July 1, 1987, shall be increased by 3% of
313	313	12 the originally granted monthly pension for each full year that
314	314	13 has elapsed since the pension began, and by an additional 3% in
315	315	14 each January thereafter. The increases provided under this
316	316	15 subsection are in lieu of the increases provided in subsection
317	317	16 (a).
318	318	17 (f) In July 2009, the monthly pension of a firefighter who
319	319	18 retired before July 1, 1977 shall be recalculated and
320	320	19 increased to reflect the amount that the firefighter would
321	321	20 have received in July 2009 had the firefighter been receiving
322	322	21 a 3% compounded increase for each year he or she received
323	323	22 pension payments after January 1, 1986, plus any increases in
324	324	23 pension received for each year prior to January 1, 1986. In
325	325	24 each January thereafter, he or she shall receive an additional
326	326	25 increase of 3% of the amount of the pension then being paid.
327	327	26 The changes made to this Section by this amendatory Act of the
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338	338	1 96th General Assembly apply without regard to whether the
339	339	2 firefighter was in service on or after its effective date.
340	340	3 (g) Notwithstanding any other provision of this Article,
341	341	4 the monthly pension of a person who first becomes a
342	342	5 firefighter under this Article on or after January 1, 2011
343	343	6 shall be increased on the January 1 occurring either on or
344	344	7 after the attainment of age 60 or the first anniversary of the
345	345	8 pension start date, whichever is later. Each annual increase
346	346	9 shall be calculated at 3% or one-half the annual unadjusted
347	347	10 percentage increase (but not less than zero) in the consumer
348	348	11 price index-u for the 12 months ending with the September
349	349	12 preceding each November 1, whichever is less, of the
350	350	13 originally granted pension. If the annual unadjusted
351	351	14 percentage change in the consumer price index-u for a 12-month
352	352	15 period ending in September is zero or, when compared with the
353	353	16 preceding period, decreases, then the pension shall not be
354	354	17 increased.
355	355	18 For the purposes of this subsection (g), "consumer price
356	356	19 index-u" means the index published by the Bureau of Labor
357	357	20 Statistics of the United States Department of Labor that
358	358	21 measures the average change in prices of goods and services
359	359	22 purchased by all urban consumers, United States city average,
360	360	23 all items, 1982-84 = 100. The new amount resulting from each
361	361	24 annual adjustment shall be determined by the Public Pension
362	362	25 Division of the Department of Insurance and made available to
363	363	26 the boards of the pension funds.
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374	374	1 For the purpose of calculating eligibility for increases
375	375	2 under this Section, the date of retirement of a firefighter
376	376	3 who retires at the conclusion of participation in the DROP
377	377	4 plan shall be deemed to be the date he or she began
378	378	5 participation in the DROP plan.
379	379	6 (Source: P.A. 96-775, eff. 8-28-09; 96-1495, eff. 1-1-11.)
380	380	7 (40 ILCS 5/4-109.4 new)
381	381	8 Sec. 4-109.4. Deferred Retirement Option Plan.
382	382	9 (a) The Deferred Retirement Option Plan created by this
383	383	10 Section shall first become available to eligible firefighters
384	384	11 on January 1, 2026.
385	385	12 (b) To be eligible to participate in the DROP plan, a
386	386	13 firefighter must (i) be in active service, (ii) have attained
387	387	14 age 50, and (iii) have at least 20 years of creditable service
388	388	15 in the fund. A firefighter may participate in the DROP plan
389	389	16 only once.
390	390	17 (c) An election to participate in the DROP plan must be
391	391	18 made within 3 years after becoming eligible under subsection
392	392	19 (b).
393	393	20 The election to participate in the DROP plan shall be made
394	394	21 in writing on forms provided for that purpose by the Board and
395	395	22 shall be filed with the Board. The application must indicate
396	396	23 the date upon which participation in the DROP plan is to begin,
397	397	24 which shall be the first day of a calendar month and not less
398	398	25 than 30 days nor more than 90 days after the date of filing the
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409	409	1 application.
410	410	2 As a part of the application, the firefighter must file
411	411	3 with the Board and with his or her employer an irrevocable
412	412	4 letter of resignation from employment, effective on the date
413	413	5 of termination of the firefighter's participation in the DROP
414	414	6 plan (unless that termination results from acceptance of a
415	415	7 disability benefit).
416	416	8 (d) A firefighter's participation in the DROP plan shall
417	417	9 commence on the date specified in the application and shall
418	418	10 end upon (i) termination of service, (ii) death of the
419	419	11 firefighter, (iii) disability for which the firefighter
420	420	12 receives a benefit under Section 4-110, 4-110.1, or 4-111, or
421	421	13 (iv) expiration of 3 years from the date the firefighter's
422	422	14 participation in the DROP plan began, whichever occurs first.
423	423	15 (e) A firefighter who is participating in the DROP plan
424	424	16 shall be considered an active firefighter for the purposes of
425	425	17 this Article, including Section 4-121, but shall be subject to
426	426	18 the special conditions of the DROP plan.
427	427	19 A firefighter shall continue to make the contributions
428	428	20 that are required for active firefighters during his or her
429	429	21 participation in the DROP plan. These contributions shall be
430	430	22 accumulated in the firefighter's DROP account and shall be
431	431	23 treated as being "picked up" within the meaning of Section
432	432	24 4-118.2 of this Code and Section 414(h)(2) of the Internal
433	433	25 Revenue Code of 1986, as amended.
434	434	26 A firefighter who is participating in the DROP plan shall
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445	445	1 not receive service credit for the period of that
446	446	2 participation, and the salary earned during that period shall
447	447	3 be disregarded in calculating the firefighter's benefits under
448	448	4 this Article.
449	449	5 (f) A firefighter who participates in the DROP plan may
450	450	6 terminate service at any time during participation in the DROP
451	451	7 plan. A firefighter who participates in the DROP plan must
452	452	8 terminate service on the last day of participation in the DROP
453	453	9 plan, unless participation in the DROP plan is ended due to
454	454	10 acceptance of a disability benefit.
455	455	11 (g) A firefighter who is participating in the DROP plan
456	456	12 remains eligible to apply for a disability benefit under
457	457	13 Section 4-110, 4-110.1, or 4-111, but participation in the
458	458	14 DROP plan ceases upon acceptance of the disability benefit. If
459	459	15 participation in the DROP plan is ended due to acceptance of a
460	460	16 disability benefit, (1) the disabled firefighter shall be
461	461	17 credited with employee contributions and creditable service
462	462	18 for the period of participation in the DROP plan, (2) the
463	463	19 firefighter's letter of resignation from service that is
464	464	20 required to be filed at the time of application to participate
465	465	21 in the DROP plan is void, and (3) the amounts in the disabled
466	466	22 firefighter's DROP account are forfeited to the fund.
467	467	23 (h) The fund shall maintain a separate DROP account for
468	468	24 the benefit of each firefighter who becomes a participant in
469	469	25 the DROP plan. The fund shall pay into the firefighter's DROP
470	470	26 account:
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481	481	1 (1) for each month of the firefighter's participation
482	482	2 in the DROP plan, an amount equal to the monthly
483	483	3 retirement pension that the firefighter would have been
484	484	4 eligible to receive if the firefighter had terminated
485	485	5 service and taken a retirement pension on the date his or
486	486	6 her participation in the DROP plan began, including any
487	487	7 increases in pension for which the firefighter would have
488	488	8 been eligible under Section 4-109.1;
489	489	9 (2) the employee contributions paid by the firefighter
490	490	10 during the period of participation in the DROP plan; and
491	491	11 (3) interest on the balance in the DROP account, at
492	492	12 the rate of 7% per annum, paid and compounded monthly,
493	493	13 throughout the period of participation in the DROP plan.
494	494	14 The DROP account shall cease earning interest when the
495	495	15 firefighter's participation in the DROP plan ends.
496	496	16 (i) In addition to the retirement pension under Section
497	497	17 4-109, a firefighter who terminates service and retires at the
498	498	18 conclusion of his or her participation in the DROP plan shall
499	499	19 receive, upon retirement, a DROP benefit equal to the balance
500	500	20 in the firefighter's DROP account at the time of retirement.
501	501	21 At the time of application for a retirement pension, the
502	502	22 firefighter shall elect to receive the DROP benefit in the
503	503	23 form of either a lump sum or an actuarially equivalent annuity
504	504	24 for life. If a lump sum payment is elected, it may be rolled
505	505	25 over into an individual retirement account or a qualified
506	506	26 retirement plan. A DROP benefit payable in the form of an
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517	517	1 annuity shall be in a fixed amount not subject to annual or
518	518	2 other increases. A DROP benefit shall be treated as a
519	519	3 retirement benefit for the purposes of Section 1-119.
520	520	4 (j) If a firefighter receiving a DROP benefit in the form
521	521	5 of an annuity re-enters service, the DROP benefit annuity
522	522	6 payments shall be suspended until the firefighter's subsequent
523	523	7 retirement.
524	524	8 (k) If a firefighter dies while participating in the DROP
525	525	9 plan, the DROP benefit shall be paid as a lump sum to the
526	526	10 surviving spouse or other survivor of the firefighter entitled
527	527	11 to a pension under Section 4-114 or, if there is no such
528	528	12 survivor, then to the deceased firefighter's estate.
529	529	13 (l) If a retired firefighter dies while receiving a DROP
530	530	14 benefit in the form of an annuity, and the DROP account balance
531	531	15 at the time of retirement exceeds the total amount of DROP
532	532	16 benefit annuity payments received, the excess shall be
533	533	17 refunded to the surviving spouse or other survivor of the
534	534	18 firefighter entitled to a pension under Section 4-114 or, if
535	535	19 there is no such survivor, then to the deceased firefighter's
536	536	20 estate.
537	537	21 Section 90. The State Mandates Act is amended by adding
538	538	22 Section 8.49 as follows:
539	539	23 (30 ILCS 805/8.49 new)
540	540	24 Sec. 8.49. Exempt mandate. Notwithstanding Sections 6 and
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551	551	1 8 of this Act, no reimbursement by the State is required for
552	552	2 the implementation of any mandate created by this amendatory
553	553	3 Act of the 104th General Assembly.
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