Pension Legislation Passed in 2025:
Public Act 104-0284 (House Bill 3193) amended the Illinois Pension Code to allow for a new transfer provision between Article 3 police pension funds and Article 4 firefighters pension funds. The statutory changes allow for a 6-month window following the effective date of the Act to transfer up to 8 years of creditable service accumulated in an Article 4 firefighters’ pension fund to an Article 3 police pension fund. Likewise, the Act allows for transfer up to 8 years of creditable service accumulated in an Article 3 police pension fund to an Article 4 firefighters pension fund. An active member must not have been subject to disciplinary action when terminating employment to be eligible under both transfers.
Of note, the effective dates in the statute are different for transfers from Article 3 to 4 and from Article 4 to 3.
The Statutory Citations below indicate the effective dates:
Police Pension Code:
40 ILCS 5/3-110.15 – transfer from Article 4 firefighter pension fund to Article 3 police pension fund (6-month window after effective date). Effective January 1, 2026.
40 ILCS 5/3-110.12 – as amended, transfer from Article 3 police pension fund to Article 4 firefighter pension fund (6-month window after effective date). Effective Date of Act: August 15, 2025.
Firefighter Pension Code:
40 ILCS 5/4-108.9 – transfer from Article 4 to Article 3 (6-month window after effective date). Effective Date January 1, 2026.
40 ILCS 5/4-108(c)(8) – transfer from Article 3 to Article 4 (6-month window after effective date). Effective August 15, 2025.
Pension Legislation to Watch in 2026:
Senate Bill 1937 (Pending – Enhancement to Tier 2 Benefits). This Bill seeks to provide enhancements to Tier 2 pension benefits intended to bring Tier 2 closer in line with traditional Tier 1 benefits. Specifically it contains provisions to raise the pensionable salary cap, increase cost-of-living adjustments, and lower the retirement age from 55 to 52 with 20 years of service for participants. The legislation would additionally extend the pension reamortization period by requiring Article 3 (police officers) and Article 4 (firefighters) pensions to be 90% funded by 2055 instead of 2040. This Bill will be discussed further in the 2026 Spring Legislative Session.