Article 3 and Article 4 Consolidation — An Explanation

Legislation Adopted – SB 1300
SB 1300 providing for the consolidation of the Downstate and Suburban Police and Fire Pension assets into two Consolidated Funds has been passed by the General Assembly and was signed by the Governor.

The bill establishes a police investment fund and a fire investment fund to invest and manage the pension assets that we now manage at the local level. The boards of trustees will consist of five seats representing the active and retired members and four from the municipalities and fire districts. There will be a transition board and interim executive director, moving over to a permanent board and director at the end of a possible 30-month transition period.

The approval of this legislation was not the outcome we had hoped for. IPPFA was against the adoption of the bill, most particularly the mandatory nature of the consolidation. We have always felt that participation in any consolidation should be a voluntary, local decision.  We drafted and distributed a resolution to our local pension boards to assist them in requesting that senators and assembly members not rush this matter through the legislative process.  We appreciate the support of the member funds in this effort.

Note that the legislation does include important improvements for the Tier 2 membership.  The salary used for calculation of pensions will be based on the final four (4) years of earnings instead of the final eight (8) years and the cap on salary that can be included in the pension calculation was improved. Also, benefits for survivors of Tier 2 police and fire actives and retirees were increased, essentially to the Tier 1 level.  IPPFA will provide more detailed information on these improvements in the near future.

In addition to these changes, IPPFA was instrumental in assisting in the passage of SB 1670, another improvement on the Tier 2 structure. Under this improvement, when an officer is transferred from the Illinois Municipal Retirement Fund (IMRF) to an Article 3 police pension fund at the same municipality, the officer will have his or her tier for benefits (Tier 1 or Tier 2) determined based on when the officer entered first entered service as a police officer in that community.

Moving forward, it is the intention of IPPFA to fully support the local pension boards during the transition. The local boards continue to exist for tax collection, setting and paying benefits, contributions and record keeping, disability determination and participant service. We will work with the interim and permanent Consolidated Funds on matters of mutual interest, and promote the reduced but still very important missions of the local pension funds.

Once the Consolidated Fund boards are established, we will initiate a program of training on consolidation issues and provide ongoing information to you as we receive it. There will certainly be “bumps in the road” as many issues are addressed and resolved.  There are a lot of unknowns to come. But the local boards and IPPFA have always ably served the interests of our active and retired police officers and firefighters and will continue to do so.

Police Pension Investment Fund Articles

 NameDate
AFFI Amicus Brief - October2022
Brief of Defendants-Appellees - October2022
IML Consolidation Motion to File Amicus Brief - October2022
Mandatory 4 Hours of Transition Training Now Available Online2020
ILLINOIS POLICE OFFICERS’ PENSION INVESTMENT FUND POLICY AND PROCEDURES TRANSITION BOARD OF TRUSTEES ELECTION POLICY2020
STATEMENT OF CANDIDACY ACTIVE OFFICER REPRESENTATIVE TRUSTEE2020
ILLINOIS POLICE OFFICERS’ PENSION INVESTMENT FUND ACTIVE POLICE OFFICER CANDIDATE PETITION2020
STATEMENT OF CANDIDACY BENEFICIARY REPRESENTATIVE TRUSTEE2020
ILLINOIS POLICE OFFICERS’ PENSION INVESTMENT FUND BENEFICIARY TRUSTEE CANDIDATE PETITION2020
STATEMENT OF CANDIDACY MUNICIPAL REPRESENTATIVE TRUSTEE2020
ILLINOIS POLICE OFFICERS’ PENSION INVESTMENT FUND MUNICIPAL TRUSTEE CANDIDATE PETITION2020
Press Release: Appointment of Executive Director2020
ILLINOIS POLICE OFFICERS’ PENSION INVESTMENT FUND ABRIDGED Meeting Notes– March 4, 2020 Full minutes forthcoming upon receipt of transcripts from Bridges Court Reporting and Video Services2020
ILLINOIS POLICE OFFICERS’ PENSION INVESTMENT FUND Transcript Meeting Notes– March 4, 20202020
February 24, 2020 Agenda for the Police Investment Pension Fund2020
Taking Next Major Step Toward Pension Consolidation, Gov. Pritzker Appoints 18 Members to Interim Police and Fire Investment Fund Boards2020
Consolidation Short Summary by Reimer & Dobrovolny PC2020
Illinois Pension Fund Systems Expense Rankings2019
All Illinois Retirement Systems 2018 Benefit and Expense Data2019
Amendment to Consolidation Senate Bill2019
IPPFA Consolidation of Pension Fund Investment Authority Fact Sheet2019
Illinois Pension Consolidation Feasibility Task Force2019