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91_HB4084
LRB9110542EGfg
1 AN ACT to amend the Illinois Pension Code and State
2 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 Sections 7-109.3, 7-142, and 7-142.1 and adding
7 Sections 7-109.4 and 7-142.2 as follows:
8 (40 ILCS 5/7-109.3) (from Ch. 108 1/2, par. 7-109.3)
9 Sec. 7-109.3. "Sheriff's Law Enforcement Employees".
10 (a) "Sheriff's law enforcement employee" or "SLEP"
11 means:
12 (1) A county sheriff and all deputies, other than
13 special deputies, employed on a full time basis in the
14 office of the sheriff.
15 (2) A person who has elected to participate in this
16 Fund under Section 3-109.1 of this Code, and who is
17 employed by a participating municipality to perform
18 police duties.
19 (3) A law enforcement officer employed on a full
20 time basis by a Forest Preserve District, provided that
21 such officer shall be deemed a "sheriff's law enforcement
22 employee" for the purposes of this Article, and service
23 in that capacity shall be deemed to be service as a
24 sheriff's law enforcement employee, only if the board of
25 commissioners of the District have so elected by adoption
26 of an affirmative resolution. Such election, once made,
27 may not be rescinded.
28 (4) A person not eligible to participate in a fund
29 established under Article 3 of this Code who is employed
30 on a full-time basis by a participating municipality or
31 participating instrumentality to perform police duties at
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1 an airport, but only if the governing authority of the
2 employer has approved sheriff's law enforcement employee
3 status for its airport police employees by adoption of an
4 affirmative resolution. Such approval, once given, may
5 not be rescinded.
6 (b) An employee who is a sheriff's law enforcement
7 employee and is granted military leave or authorized leave of
8 absence shall receive service credit in that capacity.
9 Sheriff's law enforcement employees shall not be entitled to
10 out of State service credit under Section 7-139.
11 (Source: P.A. 90-448, eff. 8-16-97.)
12 (40 ILCS 5/7-109.4 new)
13 Sec. 7-109.4. Deferred Retirement Option Plan.
14 "Deferred Retirement Option Plan" or "DROP plan" means the
15 Deferred Retirement Option Plan established under Section
16 7-142.2.
17 (40 ILCS 5/7-142) (from Ch. 108 1/2, par. 7-142)
18 Sec. 7-142. Retirement annuities - Amount.
19 (a) The amount of a retirement annuity shall be the sum
20 of the following, determined in accordance with the actuarial
21 tables in effect at the time of the grant of the annuity:
22 1. For employees with 8 or more years of service,
23 an annuity computed pursuant to subparagraphs a or b of
24 this subparagraph 1, whichever is the higher, and for
25 employees with less than 8 years of service the annuity
26 computed pursuant to subparagraph a:
27 a. The monthly annuity which can be provided
28 from the total accumulated normal, municipality and
29 prior service credits, as of the attained age of the
30 employee on the date the annuity begins provided
31 that such annuity shall not exceed 75% of the final
32 rate of earnings of the employee.
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1 b. (i) The monthly annuity amount determined
2 as follows by multiplying (a) 1 2/3% for annuitants
3 with not more than 15 years or (b) 1 2/3% for the
4 first 15 years and 2% for each year in excess of 15
5 years for annuitants with more than 15 years by the
6 number of years plus fractional years, prorated on a
7 basis of months, of creditable service and multiply
8 the product thereof by the employee's final rate of
9 earnings.
10 (ii) For the sole purpose of computing the
11 formula (and not for the purposes of the limitations
12 hereinafter stated) $125 shall be considered the
13 final rate of earnings in all cases where the final
14 rate of earnings is less than such amount.
15 (iii) The monthly annuity computed in
16 accordance with this subparagraph b, shall not
17 exceed an amount equal to 75% of the final rate of
18 earnings.
19 (iv) For employees who have less than 35 years
20 of service, the annuity computed in accordance with
21 this subparagraph b (as reduced by application of
22 subparagraph (iii) above) shall be reduced by 0.25%
23 thereof (0.5% if service was terminated before
24 January 1, 1988) for each month or fraction thereof
25 (1) that the employee's age is less than 60 years,
26 or (2) if the employee has at least 30 years of
27 service credit, that the employee's service credit
28 is less than 35 years, whichever is less, on the
29 date the annuity begins.
30 2. The annuity which can be provided from the total
31 accumulated additional credits as of the attained age of
32 the employee on the date the annuity begins.
33 (b) If payment of an annuity begins prior to the
34 earliest age at which the employee will become eligible for
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1 an old age insurance benefit under the Federal Social
2 Security Act, he may elect that the annuity payments from
3 this fund shall exceed those payable after his attaining such
4 age by an amount, computed as determined by rules of the
5 Board, but not in excess of his estimated Social Security
6 Benefit, determined as of the effective date of the annuity,
7 provided that in no case shall the total annuity payments
8 made by this fund exceed in actuarial value the annuity which
9 would have been payable had no such election been made.
10 (c) The retirement annuity shall be increased each year
11 by 2%, not compounded, of the monthly amount of annuity,
12 taking into consideration any adjustment under paragraph (b)
13 of this Section. This increase shall be effective each
14 January 1 and computed from the effective date of the
15 retirement annuity, the first increase being .167% of the
16 monthly amount times the number of months from the effective
17 date to January 1. Beginning January 1, 1984 and thereafter,
18 the retirement annuity shall be increased by 3% each year,
19 not compounded. This increase shall not be applicable to
20 annuitants who are not in service on or after September 8,
21 1971.
22 For the purpose of calculating eligibility for increases
23 under this subsection, the date of retirement of a SLEP who
24 retires at the conclusion of participation in the DROP plan
25 shall be deemed to be the date on which he or she began
26 participation in the DROP plan.
27 (Source: P.A. 91-357, eff. 7-29-99.)
28 (40 ILCS 5/7-142.1) (from Ch. 108 1/2, par. 7-142.1)
29 Sec. 7-142.1. Sheriff's law enforcement employees.
30 (a) In lieu of the retirement annuity provided by
31 subparagraph 1 of paragraph (a) of Section 7-142:
32 Any sheriff's law enforcement employee who has 20 or more
33 years of service in that capacity and who terminates service
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1 prior to January 1, 1988 shall be entitled at his option to
2 receive a monthly retirement annuity for his service as a
3 sheriff's law enforcement employee computed by multiplying 2%
4 for each year of such service up to 10 years, 2 1/4% for each
5 year of such service above 10 years and up to 20 years, and 2
6 1/2% for each year of such service above 20 years, by his
7 annual final rate of earnings and dividing by 12.
8 Any sheriff's law enforcement employee who has 20 or more
9 years of service in that capacity and who terminates service
10 on or after January 1, 1988 shall be entitled at his option
11 to receive a monthly retirement annuity for his service as a
12 sheriff's law enforcement employee computed by multiplying
13 2.5% for each year of such service up to 20 years, 2% for
14 each year of such service above 20 years and up to 30 years,
15 and 1% for each year of such service above 30 years, by his
16 annual final rate of earnings and dividing by 12.
17 If a sheriff's law enforcement employee has service in
18 any other capacity, his retirement annuity for service as a
19 sheriff's law enforcement employee may be computed under this
20 Section and the retirement annuity for his other service
21 under Section 7-142.
22 For a SLEP who retires at the conclusion of participation
23 in the DROP plan, calculation of the amount of the retirement
24 annuity shall be based on the SLEP's earnings and accumulated
25 service on the date he or she began participation in the DROP
26 plan and shall include any annual increases that would have
27 accrued under Section 7-142(c) if the SLEP had retired on
28 that date.
29 In no case shall the total monthly retirement annuity
30 exceed 75% of the monthly final rate of earnings.
31 (b) Whenever continued group insurance coverage is
32 elected in accordance with the provisions of Section 367h of
33 the Illinois Insurance Code, as now or hereafter amended, the
34 total monthly premium for such continued group insurance
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1 coverage or such portion thereof as is not paid by the
2 municipality shall, upon request of the person electing such
3 continued group insurance coverage, be deducted from any
4 monthly pension benefit otherwise payable to such person
5 pursuant to this Section, to be remitted by the Fund to the
6 insurance company or other entity providing the group
7 insurance coverage.
8 (Source: P.A. 85-941.)
9 (40 ILCS 5/7-142.2 new)
10 Sec. 7-142.2. Deferred Retirement Option Plan for SLEPs.
11 (a) The Deferred Retirement Option Plan created by this
12 Section applies only to sheriff's law enforcement employees
13 (SLEPs) and shall first become available to eligible SLEPs on
14 January 1, 2001.
15 (b) To be eligible to participate in the DROP plan, a
16 SLEP must (i) be in active service as a SLEP, (ii) have
17 attained age 50, and (iii) have at least 20 years of
18 creditable service as a SLEP. A SLEP may participate in the
19 DROP plan only once.
20 (c) An election to participate in the DROP plan must be
21 made within 3 years after becoming eligible under subsection
22 (b) or by January 1, 2004, whichever is later. The election,
23 once made, is irrevocable.
24 The election to participate in the DROP plan must be made
25 in writing on forms provided for that purpose by the Board
26 and must be filed with the Board. The application must
27 indicate the date upon which participation in the DROP plan
28 is to begin, which must be the first day of a calendar month
29 and not less than 30 days nor more than 90 days after the
30 date of filing the application.
31 As a part of the application, the SLEP must file with the
32 Board and with his or her employer an irrevocable letter of
33 resignation from employment, effective on the date of
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1 termination of the SLEP's participation in the DROP plan
2 (unless that termination results from acceptance of a
3 disability benefit).
4 (d) A SLEP's participation in the DROP plan shall
5 commence on the date specified in the application and shall
6 end upon (i) termination of service, (ii) death of the SLEP,
7 (iii) disability for which the SLEP receives a benefit under
8 this Article, or (iv) expiration of 3 years from the date the
9 SLEP's participation in the DROP plan began, whichever occurs
10 first.
11 (e) A SLEP who is participating in the DROP plan shall
12 be considered an active SLEP for the purposes of this
13 Article, including Section 7-174, but shall be subject to the
14 special conditions of the DROP plan.
15 A SLEP shall continue to make the contributions that are
16 required for active SLEPs during his or her participation in
17 the DROP plan. These contributions shall be accumulated in
18 the SLEP's DROP account and shall be treated as being "picked
19 up" within the meaning of Section 7-173.2 of this Code and
20 Section 414(h)(2) of the Internal Revenue Code of 1986, as
21 amended.
22 A SLEP who is participating in the DROP plan shall not
23 receive service credit for the period of that participation,
24 and the earnings received during that period shall be
25 disregarded in calculating the SLEP's benefits under this
26 Article.
27 (f) A SLEP who participates in the DROP plan may
28 terminate service at any time during participation in the
29 DROP plan. A SLEP who participates in the DROP plan must
30 terminate service on the last day of participation in the
31 DROP plan, unless participation in the DROP plan is ended due
32 to acceptance of a disability benefit.
33 (g) A SLEP who is participating in the DROP plan remains
34 eligible to apply for a disability benefit under this
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1 Article, but participation in the DROP plan ceases upon
2 acceptance of the disability benefit. If participation in
3 the DROP plan is ended due to acceptance of a disability
4 benefit, (1) the disabled SLEP shall be credited with
5 employee contributions and creditable service for the period
6 of participation in the DROP plan, (2) the SLEP's letter of
7 resignation from service that is required to be filed at the
8 time of application to participate in the DROP plan is void,
9 and (3) the amounts in the disabled SLEP's DROP account are
10 forfeited to the Fund.
11 (h) The Fund shall maintain a separate DROP account for
12 the benefit of each SLEP who becomes a participant in the
13 DROP plan. The Fund shall pay into the SLEP's DROP account:
14 (1) for each month of the SLEP's participation in
15 the DROP plan, an amount equal to the monthly retirement
16 annuity that the SLEP would have been eligible to receive
17 if the SLEP had terminated service and taken a retirement
18 annuity on the date his or her participation in the DROP
19 plan began, including any increases in that annuity for
20 which the SLEP would have been eligible under Section
21 7-142(c);
22 (2) an amount equal to any supplemental benefit
23 payment that the SLEP would have been eligible to receive
24 under Section 7-144.3 if the SLEP had terminated service
25 and taken a retirement annuity on the date his or her
26 participation in the DROP plan began;
27 (3) the employee contributions paid by the SLEP
28 during the period of participation in the DROP plan; and
29 (4) interest on the balance in the DROP account, at
30 the rate of 7% per annum, paid and compounded monthly,
31 throughout the period of participation in the DROP plan.
32 The DROP account shall cease earning interest when the
33 SLEP's participation in the DROP plan ends.
34 (i) In addition to his or her retirement annuity, a SLEP
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1 who terminates service and retires at the conclusion of his
2 or her participation in the DROP plan shall receive, upon
3 retirement, a DROP benefit equal to the balance in the SLEP's
4 DROP account at the time of retirement.
5 At the time of application for a retirement annuity, the
6 SLEP shall elect to receive the DROP benefit in the form of
7 either a lump sum or an actuarially equivalent annuity for
8 life. If a lump sum payment is elected, it may be taken in
9 the form of cash or a cash equivalent or be rolled over into
10 an individual retirement account (IRA) or a qualified
11 retirement plan. A DROP benefit payable in the form of an
12 annuity shall be in a fixed amount not subject to annual or
13 other increases. A DROP benefit shall be treated as a
14 retirement benefit for the purposes of Section 1-119
15 (QILDROs).
16 (j) If a SLEP receiving a DROP benefit in the form of an
17 annuity re-enters service, the DROP benefit annuity payments
18 shall be suspended until the SLEP's subsequent retirement.
19 (k) If a SLEP dies while participating in the DROP plan,
20 the DROP benefit shall be paid as a lump sum to the surviving
21 spouse or other survivor of the SLEP entitled to an annuity
22 under this Article or, if there is no such survivor, then to
23 the deceased SLEP's estate.
24 (l) If a retired SLEP dies while receiving a DROP
25 benefit in the form of an annuity, and the DROP account
26 balance at the time of retirement exceeds the total amount of
27 DROP benefit annuity payments received, the excess shall be
28 refunded to the surviving spouse or other survivor of the
29 SLEP entitled to an annuity under this Article or, if there
30 is no such survivor, then to the deceased SLEP's estate.
31 Section 90. The State Mandates Act is amended by adding
32 Section 8.24 as follows:
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1 (30 ILCS 805/8.24 new)
2 Sec. 8.24. Exempt mandate. Notwithstanding Sections 6
3 and 8 of this Act, no reimbursement by the State is required
4 for the implementation of any mandate created by this
5 amendatory Act of the 91st General Assembly.
6 Section 99. Effective date. This Act takes effect upon
7 becoming law.