1.2 Introduction

Meeting room

1.2 Introduction

The Board recognizes that a sound governance structure is essential to fulfilling its duties and responsibilities. The Board has prepared and adopted this Governance Manual to establish the framework within which the Board intends to set governance and oversight policy.

The purpose of the Manual is twofold. First, it serves as an ongoing reference manual for the current Trustees and IMRF staff. Second, it provides orientation material for new Trustees as to the roles, responsibilities, structure, procedures, policies, and activities in the governance and oversight of the IMRF.


The Illinois Municipal Retirement Fund was created by the Illinois General Assembly in 1939. The statutory provisions may be found at 40 Illinois Compiled Statutes 5/7-101 through 5/7-224. These provisions are also known as sections of the Illinois Pension Code. IMRF began operations in 1941 with five employers: City of Rockford; Rockford Park District; City of Evanston; City of Galesburg; and, Village of Riverside.

In 1948, participation became compulsory for all school districts with respect to non-teaching staff. In 1951, participation became compulsory for all counties and cities, villages and towns of 10,000 or more in population. All other units of government were permitted participation through adoption of an ordinance or resolution.

Today, IMRF has over 2,900 separate participating employers comprised of over 40 different units of government. Participation continues to grow at the option of the governmental unit and with approval of the Board of Trustees.

As can be expected, the governing statute has been amended on numerous occasions. The regular plan formula has been in place since 1974. The Sheriffs’ Law Enforcement Plan (SLEP) went into effect in 1973 with its last formula change in 1988. The Elected County Officials Plan (ECO) went into effect in 1997.

In 1957, a referendum was held amongst participating employees on the desirability of joining Social Security. The referendum carried with 72% voting in favor. Coverage began January 1, 1958.

Mission Statement

Section 7-102 of the Illinois Pension Code provides in part:

It is the mission of this Fund to efficiently and impartially develop, implement and administer programs that provide income protection to members and the beneficiaries on behalf of participating employers in a prudent manner.

Constitutional Protection

The benefits provided by IMRF were seen as a right which could be modified or withdrawn until the 1971 revision of the Illinois Constitution. The new and current Constitution elevated protection of IMRF benefits by providing in Article XIII Section 5:

Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.

This protection extends to current participants in IMRF. A new, lower tier of benefits can be enacted which applies only to new hires. Finally, the Illinois Constitution can be amended in the future to modify or eliminate this provision.

Board Composition

The Board is comprised of eight Trustees: four Executive Trustees elected by employers; three Employee Trustees elected by active members; and, one Annuitant Trustee elected by annuitants.

The Board is a democratic body elected by a diverse membership. No qualifications exist except vesting, (for all Trustees) holding a high management position (for Executive Trustee) or being an annuitant (Annuitant Trustee). It is not required nor expected that Trustees possess investment or financial credentials. The Board delegates to expert staff, consultants and other professionals. This places due diligence responsibilities on the Trustees to hire the best and to monitor performance; to affirmatively obtain Trustee training; and, to ask questions and receive responsive answers.