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91_HB2368
LRB9105292EGfg
1 AN ACT to amend the Illinois Pension Code by changing
2 Section 7-139 and to amend the State Mandates Act.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Pension Code is amended by
6 changing Section 7-139 as follows:
7 (40 ILCS 5/7-139) (from Ch. 108 1/2, par. 7-139)
8 Sec. 7-139. Credits and creditable service to employees.
9 (a) Each participating employee shall be granted credits
10 and creditable service, for purposes of determining the
11 amount of any annuity or benefit to which he or a beneficiary
12 is entitled, as follows:
13 1. For prior service: Each participating employee
14 who is an employee of a participating municipality or
15 participating instrumentality on the effective date shall
16 be granted creditable service, but no credits under
17 paragraph 2 of this subsection (a), for periods of prior
18 service for which credit has not been received under any
19 other pension fund or retirement system established under
20 this Code, as follows:
21 If the effective date of participation for the
22 participating municipality or participating
23 instrumentality is on or before January 1, 1998,
24 creditable service shall be granted for the entire period
25 of prior service with that employer without any employee
26 contribution.
27 If the effective date of participation for the
28 participating municipality or participating
29 instrumentality is after January 1, 1998, creditable
30 service shall be granted for the last 20% of the period
31 of prior service with that employer, but no more than 5
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1 years, without any employee contribution. A
2 participating employee may establish creditable service
3 for the remainder of the period of prior service with
4 that employer by making an application in writing,
5 accompanied by payment of an employee contribution in an
6 amount determined by the Fund, based on the employee
7 contribution rates in effect at the time of application
8 for the creditable service and the employee's salary rate
9 on the effective date of participation for that employer,
10 plus interest at the effective rate from the date of the
11 prior service to the date of payment. Application for
12 this creditable service may be made at any time while the
13 employee is still in service.
14 Any person who has withdrawn from the service of a
15 participating municipality or participating
16 instrumentality prior to the effective date, who reenters
17 the service of the same municipality or participating
18 instrumentality after the effective date and becomes a
19 participating employee is entitled to creditable service
20 for prior service as otherwise provided in this
21 subdivision (a)(1) only if he or she renders 2 years of
22 service as a participating employee after the effective
23 date. Application for such service must be made while in
24 a participating status. The salary rate to be used in
25 the calculation of the required employee contribution, if
26 any, shall be the employee's salary rate at the time of
27 first reentering service with the employer after the
28 employer's effective date of participation.
29 2. For current service, each participating employee
30 shall be credited with:
31 a. Additional credits of amounts equal to each
32 payment of additional contributions received from
33 him under Section 7-173, as of the date the
34 corresponding payment of earnings is payable to him.
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1 b. Normal credits of amounts equal to each
2 payment of normal contributions received from him,
3 as of the date the corresponding payment of earnings
4 is payable to him, and normal contributions made for
5 the purpose of establishing out-of-state service
6 credits as permitted under the conditions set forth
7 in paragraph 6 of this subsection (a).
8 c. Municipality credits in an amount equal to
9 1.4 times the normal credits, except those
10 established by out-of-state service credits, as of
11 the date of computation of any benefit if these
12 credits would increase the benefit.
13 d. Survivor credits equal to each payment of
14 survivor contributions received from the
15 participating employee as of the date the
16 corresponding payment of earnings is payable, and
17 survivor contributions made for the purpose of
18 establishing out-of-state service credits.
19 3. For periods of temporary and total and permanent
20 disability benefits, each employee receiving disability
21 benefits shall be granted creditable service for the
22 period during which disability benefits are payable.
23 Normal and survivor credits, based upon the rate of
24 earnings applied for disability benefits, shall also be
25 granted if such credits would result in a higher benefit
26 to any such employee or his beneficiary.
27 4. For authorized leave of absence without pay: A
28 participating employee shall be granted credits and
29 creditable service for periods of authorized leave of
30 absence without pay under the following conditions:
31 a. An application for credits and creditable
32 service is submitted to the board while the employee
33 is in a status of active employment, and within 2
34 years after termination of the leave of absence
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1 period for which credits and creditable service are
2 sought.
3 b. Not more than 12 complete months of
4 creditable service for authorized leave of absence
5 without pay shall be counted for purposes of
6 determining any benefits payable under this Article.
7 c. Credits and creditable service shall be
8 granted for leave of absence only if such leave is
9 approved by the governing body of the municipality,
10 including approval of the estimated cost thereof to
11 the municipality as determined by the fund, and
12 employee contributions, plus interest at the
13 effective rate applicable for each year from the end
14 of the period of leave to date of payment, have been
15 paid to the fund in accordance with Section 7-173.
16 The contributions shall be computed upon the
17 assumption earnings continued during the period of
18 leave at the rate in effect when the leave began.
19 d. Benefits under the provisions of Sections
20 7-141, 7-146, 7-150 and 7-163 shall become payable
21 to employees on authorized leave of absence, or
22 their designated beneficiary, only if such leave of
23 absence is creditable hereunder, and if the employee
24 has at least one year of creditable service other
25 than the service granted for leave of absence. Any
26 employee contributions due may be deducted from any
27 benefits payable.
28 e. No credits or creditable service shall be
29 allowed for leave of absence without pay during any
30 period of prior service.
31 5. For military service: The governing body of a
32 municipality or participating instrumentality may elect
33 to allow creditable service to participating employees
34 who leave their employment to serve in the armed forces
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1 of the United States for all periods of such service,
2 provided that the person returns to active employment
3 within 90 days after completion of full time active duty,
4 but no creditable service shall be allowed such person
5 for any period that can be used in the computation of a
6 pension or any other pay or benefit, other than pay for
7 active duty, for service in any branch of the armed
8 forces of the United States. If necessary to the
9 computation of any benefit, the board shall establish
10 municipality credits for participating employees under
11 this paragraph on the assumption that the employee
12 received earnings at the rate received at the time he
13 left the employment to enter the armed forces. A
14 participating employee in the armed forces shall not be
15 considered an employee during such period of service and
16 no additional death and no disability benefits are
17 payable for death or disability during such period.
18 Any participating employee who left his employment
19 with a municipality or participating instrumentality to
20 serve in the armed forces of the United States and who
21 again became a participating employee within 90 days
22 after completion of full time active duty by entering the
23 service of a different municipality or participating
24 instrumentality, which has elected to allow creditable
25 service for periods of military service under the
26 preceding paragraph, shall also be allowed creditable
27 service for his period of military service on the same
28 terms that would apply if he had been employed, before
29 entering military service, by the municipality or
30 instrumentality which employed him after he left the
31 military service and the employer costs arising in
32 relation to such grant of creditable service shall be
33 charged to and paid by that municipality or
34 instrumentality.
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1 Notwithstanding the foregoing, any participating
2 employee shall be entitled to creditable service as
3 required by any federal law relating to re-employment
4 rights of persons who served in the United States Armed
5 Services. Such creditable service shall be granted upon
6 payment by the member of an amount equal to the employee
7 contributions which would have been required had the
8 employee continued in service at the same rate of
9 earnings during the military leave period, plus interest
10 at the effective rate.
11 5.1. In addition to any creditable service
12 established under paragraph 5 of this subsection (a),
13 creditable service may be granted for up to 24 months of
14 service in the armed forces of the United States.
15 In order to receive creditable service for military
16 service under this paragraph 5.1, a participating
17 employee or annuitant must (1) apply to the Fund in
18 writing and provide evidence of the military service that
19 is satisfactory to the Board; (2) obtain the written
20 approval of the current employer or, in the case of an
21 annuitant, any former employer under which the annuitant
22 participated in the Fund; and (3) make contributions to
23 the Fund equal to (i) the employee contributions that
24 would have been required had the service been rendered as
25 a member, plus (ii) an amount determined by the board to
26 be equal to the employer's normal cost of the benefits
27 accrued for that military service, plus (iii) interest on
28 items (i) and (ii) from the date of first membership in
29 the Fund to the date of payment. If payment is made
30 during the 6-month period that begins 3 months after the
31 effective date of this amendatory Act of 1997, the
32 required interest shall be at the rate of 2.5% per year,
33 compounded annually; otherwise, the required interest
34 shall be calculated at the regular interest rate.
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1 The changes to this paragraph 5.1 made by this amendatory
2 Act of the 91st General Assembly apply to any person who is a
3 retirement annuitant on its effective date. In the case of
4 an annuitant who applies for credit allowable under this
5 paragraph and makes the required contributions, the annuity
6 shall be recalculated to include the additional service
7 credit, with the increase taking effect on the date the Fund
8 receives written notification of the annuitant's intent to
9 purchase the credit, if payment of all the required
10 contributions is made within 60 days of that notice, or else
11 on the first annuity payment date following the date of
12 payment of the required contributions. In calculating the
13 automatic annual increase for an annuity that has been
14 recalculated under this Section, the increase attributable to
15 the additional service allowable under this amendatory Act of
16 the 91st General Assembly shall be included in the
17 calculation of automatic annual increases accruing after the
18 effective date of the recalculation.
19 6. For out-of-state service: Creditable service
20 shall be granted for service rendered to an out-of-state
21 local governmental body under the following conditions:
22 The employee had participated and has irrevocably
23 forfeited all rights to benefits in the out-of-state
24 public employees pension system; the governing body of
25 his participating municipality or instrumentality
26 authorizes the employee to establish such service; the
27 employee has 2 years current service with this
28 municipality or participating instrumentality; the
29 employee makes a payment of contributions, which shall be
30 computed at 8% (normal) plus 2% (survivor) times length
31 of service purchased times the average rate of earnings
32 for the first 2 years of service with the municipality or
33 participating instrumentality whose governing body
34 authorizes the service established plus interest at the
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1 effective rate on the date such credits are established,
2 payable from the date the employee completes the required
3 2 years of current service to date of payment. In no
4 case shall more than 120 months of creditable service be
5 granted under this provision.
6 7. For retroactive service: Any employee who could
7 have but did not elect to become a participating
8 employee, or who should have been a participant in the
9 Municipal Public Utilities Annuity and Benefit Fund
10 before that fund was superseded, may receive creditable
11 service for the period of service not to exceed 50
12 months; however, a current or former county board member
13 may establish credit under this paragraph 7 for more than
14 50 months of service as a member of the county board if
15 the excess over 50 months is approved by resolution of
16 the affected county board filed with the Fund before
17 January 1, 1999.
18 Any employee who is a participating employee on or
19 after September 24, 1981 and who was excluded from
20 participation by the age restrictions removed by Public
21 Act 82-596 may receive creditable service for the period,
22 on or after January 1, 1979, excluded by the age
23 restriction and, in addition, if the governing body of
24 the participating municipality or participating
25 instrumentality elects to allow creditable service for
26 all employees excluded by the age restriction prior to
27 January 1, 1979, for service during the period prior to
28 that date excluded by the age restriction. Any employee
29 who was excluded from participation by the age
30 restriction removed by Public Act 82-596 and who is not a
31 participating employee on or after September 24, 1981 may
32 receive creditable service for service after January 1,
33 1979. Creditable service under this paragraph shall be
34 granted upon payment of the employee contributions which
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1 would have been required had he participated, with
2 interest at the effective rate for each year from the end
3 of the period of service established to date of payment.
4 8. For accumulated unused sick leave: A
5 participating employee who is applying for a retirement
6 annuity shall be entitled to creditable service for that
7 portion of the employee's accumulated unused sick leave
8 for which payment is not received, as follows:
9 a. Sick leave days shall be limited to those
10 accumulated under a sick leave plan established by a
11 participating municipality or participating
12 instrumentality which is available to all employees
13 or a class of employees.
14 b. Only sick leave days accumulated with a
15 participating municipality or participating
16 instrumentality with which the employee was in
17 service within 60 days of the effective date of his
18 retirement annuity shall be credited; If the
19 employee was in service with more than one employer
20 during this period only the sick leave days with the
21 employer with which the employee has the greatest
22 number of unpaid sick leave days shall be
23 considered.
24 c. The creditable service granted shall be
25 considered solely for the purpose of computing the
26 amount of the retirement annuity and shall not be
27 used to establish any minimum service period
28 required by any provision of the Illinois Pension
29 Code, the effective date of the retirement annuity,
30 or the final rate of earnings.
31 d. The creditable service shall be at the rate
32 of 1/20 of a month for each full sick day, provided
33 that no more than 12 months may be credited under
34 this subdivision 8.
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1 e. Employee contributions shall not be
2 required for creditable service under this
3 subdivision 8.
4 f. Each participating municipality and
5 participating instrumentality with which an employee
6 has service within 60 days of the effective date of
7 his retirement annuity shall certify to the board
8 the number of accumulated unpaid sick leave days
9 credited to the employee at the time of termination
10 of service.
11 9. For service transferred from another system:
12 Credits and creditable service shall be granted for
13 service under Article 3, 4, 5, 14 or 16 of this Act, to
14 any active member of this Fund, and to any inactive
15 member who has been a county sheriff, upon transfer of
16 such credits pursuant to Section 3-110.3, 4-108.3, 5-235,
17 14-105.6 or 16-131.4, and payment by the member of the
18 amount by which (1) the employer and employee
19 contributions that would have been required if he had
20 participated in this Fund as a sheriff's law enforcement
21 employee during the period for which credit is being
22 transferred, plus interest thereon at the effective rate
23 for each year, compounded annually, from the date of
24 termination of the service for which credit is being
25 transferred to the date of payment, exceeds (2) the
26 amount actually transferred to the Fund. Such transferred
27 service shall be deemed to be service as a sheriff's law
28 enforcement employee for the purposes of Section 7-142.1.
29 (b) Creditable service - amount:
30 1. One month of creditable service shall be allowed
31 for each month for which a participating employee made
32 contributions as required under Section 7-173, or for
33 which creditable service is otherwise granted hereunder.
34 Not more than 1 month of service shall be credited and
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1 counted for 1 calendar month, and not more than 1 year of
2 service shall be credited and counted for any calendar
3 year. A calendar month means a nominal month beginning
4 on the first day thereof, and a calendar year means a
5 year beginning January 1 and ending December 31.
6 2. A seasonal employee shall be given 12 months of
7 creditable service if he renders the number of months of
8 service normally required by the position in a 12-month
9 period and he remains in service for the entire 12-month
10 period. Otherwise a fractional year of service in the
11 number of months of service rendered shall be credited.
12 3. An intermittent employee shall be given
13 creditable service for only those months in which a
14 contribution is made under Section 7-173.
15 (c) No application for correction of credits or
16 creditable service shall be considered unless the board
17 receives an application for correction while (1) the
18 applicant is a participating employee and in active
19 employment with a participating municipality or
20 instrumentality, or (2) while the applicant is actively
21 participating in a pension fund or retirement system which is
22 a participating system under the Retirement Systems
23 Reciprocal Act. A participating employee or other applicant
24 shall not be entitled to credits or creditable service unless
25 the required employee contributions are made in a lump sum or
26 in installments made in accordance with board rule.
27 (d) Upon the granting of a retirement, surviving spouse
28 or child annuity, a death benefit or a separation benefit, on
29 account of any employee, all individual accumulated credits
30 shall thereupon terminate. Upon the withdrawal of additional
31 contributions, the credits applicable thereto shall thereupon
32 terminate.
33 (Source: P.A. 90-448, eff. 8-16-97.)
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1 Section 90. The State Mandates Act is amended by adding
2 Section 8.23 as follows:
3 (30 ILCS 805/8.23 new)
4 Sec. 8.23. Exempt mandate. Notwithstanding Sections 6
5 and 8 of this Act, no reimbursement by the State is required
6 for the implementation of any mandate created by this
7 amendatory Act of the 91st General Assembly.
8 Section 99. Effective date. This Act takes effect upon
9 becoming law.