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91_HB4183
LRB9111615EGfgA
1 AN ACT in relation to public employee benefits.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 5. The Illinois Pension Code is amended by
5 changing Sections 7-139, 7-141, 7-142, 7-168, and 7-174 as
6 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14 Any person who has withdrawn from the service of a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 must (1) apply to the Fund in writing and
18 provide evidence of the military service that is
19 satisfactory to the Board; (2) obtain the written
20 approval of the current employer; and (3) make
21 contributions to the Fund equal to (i) the employee
22 contributions that would have been required had the
23 service been rendered as a member, plus (ii) an amount
24 determined by the board to be equal to the employer's
25 normal cost of the benefits accrued for that military
26 service, plus (iii) interest on items (i) and (ii) from
27 the date of first membership in the Fund to the date of
28 payment. If payment is made during the 6-month period
29 that begins 3 months after the effective date of this
30 amendatory Act of 1997, the required interest shall be at
31 the rate of 2.5% per year, compounded annually;
32 otherwise, the required interest shall be calculated at
33 the regular interest rate.
34 6. For out-of-state service: Creditable service
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1 shall be granted for service rendered to an out-of-state
2 local governmental body under the following conditions:
3 The employee had participated and has irrevocably
4 forfeited all rights to benefits in the out-of-state
5 public employees pension system; the governing body of
6 his participating municipality or instrumentality
7 authorizes the employee to establish such service; the
8 employee has 2 years current service with this
9 municipality or participating instrumentality; the
10 employee makes a payment of contributions, which shall be
11 computed at 8% (normal) plus 2% (survivor) times length
12 of service purchased times the average rate of earnings
13 for the first 2 years of service with the municipality or
14 participating instrumentality whose governing body
15 authorizes the service established plus interest at the
16 effective rate on the date such credits are established,
17 payable from the date the employee completes the required
18 2 years of current service to date of payment. In no
19 case shall more than 120 months of creditable service be
20 granted under this provision.
21 7. For retroactive service: Any employee who could
22 have but did not elect to become a participating
23 employee, or who should have been a participant in the
24 Municipal Public Utilities Annuity and Benefit Fund
25 before that fund was superseded, may receive creditable
26 service for the period of service not to exceed 50
27 months; however, a current or former county board member
28 may establish credit under this paragraph 7 for more than
29 50 months of service as a member of the county board if
30 the excess over 50 months is approved by resolution of
31 the affected county board filed with the Fund before
32 January 1, 1999.
33 Any employee who is a participating employee on or
34 after September 24, 1981 and who was excluded from
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1 participation by the age restrictions removed by Public
2 Act 82-596 may receive creditable service for the period,
3 on or after January 1, 1979, excluded by the age
4 restriction and, in addition, if the governing body of
5 the participating municipality or participating
6 instrumentality elects to allow creditable service for
7 all employees excluded by the age restriction prior to
8 January 1, 1979, for service during the period prior to
9 that date excluded by the age restriction. Any employee
10 who was excluded from participation by the age
11 restriction removed by Public Act 82-596 and who is not a
12 participating employee on or after September 24, 1981 may
13 receive creditable service for service after January 1,
14 1979. Creditable service under this paragraph shall be
15 granted upon payment of the employee contributions which
16 would have been required had he participated, with
17 interest at the effective rate for each year from the end
18 of the period of service established to date of payment.
19 8. For accumulated unused sick leave: A
20 participating employee who is applying for a retirement
21 annuity shall be entitled to creditable service for that
22 portion of the employee's accumulated unused sick leave
23 for which payment is not received, as follows:
24 a. Sick leave days shall be limited to those
25 accumulated under a sick leave plan established by a
26 participating municipality or participating
27 instrumentality which is available to all employees
28 or a class of employees.
29 b. Only sick leave days accumulated with a
30 participating municipality or participating
31 instrumentality with which the employee was in
32 service within 60 days of the effective date of his
33 retirement annuity shall be credited; If the
34 employee was in service with more than one employer
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1 during this period only the sick leave days with the
2 employer with which the employee has the greatest
3 number of unpaid sick leave days shall be
4 considered.
5 c. The creditable service granted shall be
6 considered solely for the purpose of computing the
7 amount of the retirement annuity and shall not be
8 used to establish any minimum service period
9 required by any provision of the Illinois Pension
10 Code, the effective date of the retirement annuity,
11 or the final rate of earnings.
12 d. The creditable service shall be at the rate
13 of 1/20 of a month for each full sick day, provided
14 that no more than 12 months may be credited under
15 this subdivision 8.
16 e. Employee contributions shall not be
17 required for creditable service under this
18 subdivision 8.
19 f. Each participating municipality and
20 participating instrumentality with which an employee
21 has service within 60 days of the effective date of
22 his retirement annuity shall certify to the board
23 the number of accumulated unpaid sick leave days
24 credited to the employee at the time of termination
25 of service.
26 9. For service transferred from another system:
27 Credits and creditable service shall be granted for
28 service under Article 3, 4, 5, 14 or 16 of this Act, to
29 any active member of this Fund, and to any inactive
30 member who has been a county sheriff, upon transfer of
31 such credits pursuant to Section 3-110.3, 4-108.3, 5-235,
32 14-105.6 or 16-131.4, and payment by the member of the
33 amount by which (1) the employer and employee
34 contributions that would have been required if he had
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1 participated in this Fund as a sheriff's law enforcement
2 employee during the period for which credit is being
3 transferred, plus interest thereon at the effective rate
4 for each year, compounded annually, from the date of
5 termination of the service for which credit is being
6 transferred to the date of payment, exceeds (2) the
7 amount actually transferred to the Fund. Such transferred
8 service shall be deemed to be service as a sheriff's law
9 enforcement employee for the purposes of Section 7-142.1.
10 (b) Creditable service - amount:
11 1. One month of creditable service shall be allowed
12 for each month for which a participating employee made
13 contributions as required under Section 7-173, or for
14 which creditable service is otherwise granted hereunder.
15 Not more than 1 month of service shall be credited and
16 counted for 1 calendar month, and not more than 1 year of
17 service shall be credited and counted for any calendar
18 year. A calendar month means a nominal month beginning
19 on the first day thereof, and a calendar year means a
20 year beginning January 1 and ending December 31.
21 2. A seasonal employee shall be given 12 months of
22 creditable service if he renders the number of months of
23 service normally required by the position in a 12-month
24 period and he remains in service for the entire 12-month
25 period. Otherwise a fractional year of service in the
26 number of months of service rendered shall be credited.
27 3. An intermittent employee shall be given
28 creditable service for only those months in which a
29 contribution is made under Section 7-173.
30 (c) No application for correction of credits or
31 creditable service shall be considered unless the board
32 receives an application for correction while (1) the
33 applicant is a participating employee and in active
34 employment with a participating municipality or
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1 instrumentality, or (2) while the applicant is actively
2 participating in a pension fund or retirement system which is
3 a participating system under the Retirement Systems
4 Reciprocal Act. A participating employee or other applicant
5 shall not be entitled to credits or creditable service unless
6 the required employee contributions are made in a lump sum or
7 in installments made in accordance with board rule.
8 (d) Upon the granting of a retirement, surviving spouse
9 or child annuity, a death benefit or a separation benefit, on
10 account of any employee, all individual accumulated credits
11 shall thereupon terminate. Upon the withdrawal of additional
12 contributions, the credits applicable thereto shall thereupon
13 terminate.
14 (Source: P.A. 90-448, eff. 8-16-97.)
15 (40 ILCS 5/7-141) (from Ch. 108 1/2, par. 7-141)
16 Sec. 7-141. Retirement annuities - Conditions.
17 Retirement annuities shall be payable as hereinafter set
18 forth:
19 (a) A participating employee who, regardless of cause,
20 is separated from the service of all participating
21 municipalities and instrumentalities thereof and
22 participating instrumentalities shall be entitled to a
23 retirement annuity provided:
24 1. He is at least age 55, or in the case of a person who
25 is eligible to have his annuity calculated under Section
26 7-142.1, he is at least age 50;
27 2. He is (i) an employee who was employed by any
28 participating municipality or participating instrumentality
29 which had not elected to exclude persons employed in
30 positions normally requiring performance of duty for less
31 than 1000 hours per year or was employed in a position
32 normally requiring performance of duty for 600 hours or more
33 per year prior to such election by any participating
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1 municipality or participating instrumentality included in and
2 subject to this Article on or before the effective date of
3 this amendatory Act of 1981 which made such election and is
4 not entitled to receive earnings for employment in a position
5 normally requiring performance of duty for 600 hours or more
6 per year for any participating municipality and
7 instrumentalities thereof and participating instrumentality;
8 or (ii) an employee who was employed only by a participating
9 municipality or participating instrumentality, or
10 participating municipalities or participating
11 instrumentalities, which have elected to exclude persons in
12 positions normally requiring performance of duty for less
13 than 1000 hours per year after the effective date of such
14 exclusion or which are included under and subject to the
15 Article after the effective date of this amendatory Act of
16 1981 and elects to exclude persons in such positions, and is
17 not entitled to receive earnings for employment in a position
18 normally requiring performance of duty for 1000 hours or more
19 per year by such a participating municipality or
20 participating instrumentality;
21 3. The amount of his annuity, before the application of
22 paragraph (b) of Section 7-142 is at least $10 per month;
23 4. If he first became a participating employee after
24 December 31, 1961, he has at least 5 years 8 years of
25 service.
26 (b) Retirement annuities shall be payable:
27 1. As provided in Section 7-119;
28 2. Except as provided in item 3, upon receipt by the
29 fund of a written application by the board. The effective
30 date may be not more than one year prior to the date of the
31 receipt by the fund of the application;
32 3. Upon attainment of age 70 1/2 if (i) the member has
33 not submitted an application for the annuity, (ii) the member
34 has at least 5 years 8 years of service credit and is no
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1 longer in service, (iii) the pension amount is at least $30
2 per month, and (iv) the Fund is able to locate the member;
3 4. To the beneficiary of the deceased annuitant for the
4 unpaid amount accrued to date of death, if any.
5 (Source: P.A. 87-740.)
6 (40 ILCS 5/7-142) (from Ch. 108 1/2, par. 7-142)
7 Sec. 7-142. Retirement annuities - Amount.
8 (a) The amount of a retirement annuity shall be the sum
9 of the following, determined in accordance with the actuarial
10 tables in effect at the time of the grant of the annuity:
11 1. For employees with 5 or 8 or more years of
12 service, an annuity computed pursuant to subparagraphs a
13 or b of this subparagraph 1, whichever is the higher, and
14 for employees with less than 5 years 8 years of service,
15 the annuity computed pursuant to subparagraph a:
16 a. The monthly annuity which can be provided
17 from the total accumulated normal, municipality and
18 prior service credits, as of the attained age of the
19 employee on the date the annuity begins provided
20 that such annuity shall not exceed 75% of the final
21 rate of earnings of the employee.
22 b. (i) The monthly annuity amount determined
23 as follows by multiplying (a) 1 2/3% for annuitants
24 with not more than 15 years or (b) 1 2/3% for the
25 first 15 years and 2% for each year in excess of 15
26 years for annuitants with more than 15 years by the
27 number of years plus fractional years, prorated on a
28 basis of months, of creditable service and multiply
29 the product thereof by the employee's final rate of
30 earnings.
31 (ii) For the sole purpose of computing the
32 formula (and not for the purposes of the limitations
33 hereinafter stated) $125 shall be considered the
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1 final rate of earnings in all cases where the final
2 rate of earnings is less than such amount.
3 (iii) The monthly annuity computed in
4 accordance with this subparagraph b, shall not
5 exceed an amount equal to 75% of the final rate of
6 earnings.
7 (iv) For employees who have less than 35 years
8 of service, the annuity computed in accordance with
9 this subparagraph b (as reduced by application of
10 subparagraph (iii) above) shall be reduced by 0.25%
11 thereof (0.5% if service was terminated before
12 January 1, 1988) for each month or fraction thereof
13 (1) that the employee's age is less than 60 years,
14 or (2) if the employee has at least 30 years of
15 service credit, that the employee's service credit
16 is less than 35 years, whichever is less, on the
17 date the annuity begins.
18 2. The annuity which can be provided from the total
19 accumulated additional credits as of the attained age of
20 the employee on the date the annuity begins.
21 (b) If payment of an annuity begins prior to the
22 earliest age at which the employee will become eligible for
23 an old age insurance benefit under the Federal Social
24 Security Act, he may elect that the annuity payments from
25 this fund shall exceed those payable after his attaining such
26 age by an amount, computed as determined by rules of the
27 Board, but not in excess of his estimated Social Security
28 Benefit, determined as of the effective date of the annuity,
29 provided that in no case shall the total annuity payments
30 made by this fund exceed in actuarial value the annuity which
31 would have been payable had no such election been made.
32 (c) The retirement annuity shall be increased each year
33 by 2%, not compounded, of the monthly amount of annuity,
34 taking into consideration any adjustment under paragraph (b)
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1 of this Section. This increase shall be effective each
2 January 1 and computed from the effective date of the
3 retirement annuity, the first increase being .167% of the
4 monthly amount times the number of months from the effective
5 date to January 1. Beginning January 1, 1984 and thereafter,
6 the retirement annuity shall be increased by 3% each year,
7 not compounded. This increase shall not be applicable to
8 annuitants who are not in service on or after September 8,
9 1971.
10 (Source: P.A. 91-357, eff. 7-29-99.)
11 (40 ILCS 5/7-168) (from Ch. 108 1/2, par. 7-168)
12 Sec. 7-168. Separation benefits - Amount. The amount of
13 the separation benefit benefits shall be the sum of the
14 employee's accumulated normal, survivor, and additional
15 contributions. Separation benefits paid on or after the
16 effective date of this amendatory Act of the 91st General
17 Assembly may also include interest on the refunded
18 contributions, calculated at a rate and in a manner
19 determined by the Board.
20 (Source: P.A. 87-740.)
21 (40 ILCS 5/7-174) (from Ch. 108 1/2, par. 7-174)
22 Sec. 7-174. Board created.
23 (a) A board of 8 members shall constitute a board of
24 trustees authorized to carry out the provisions of this
25 Article. Each trustee shall be a participating employee of a
26 participating municipality or participating instrumentality
27 or an annuitant of the Fund and no person shall be eligible
28 to become a trustee after January 1, 1979 who does not have
29 at least 5 years 8 years of creditable service.
30 (b) The board shall consist of representatives of
31 various groups as follows:
32 1. 4 trustees shall be a chief executive officer,
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1 chief finance officer, or other officer, executive or
2 department head of a participating municipality or
3 participating instrumentality, and each such trustee
4 shall be designated as an executive trustee.
5 2. 3 trustees shall be employees of a participating
6 municipality or participating instrumentality and each
7 such trustee shall be designated as an employee trustee.
8 3. One trustee shall be an annuitant of the Fund,
9 who shall be designated the annuitant trustee.
10 (c) A person elected as a trustee shall qualify as a
11 trustee, after declaration by the board that he has been duly
12 elected, upon taking and subscribing to the constitutional
13 oath of office and filing same in the office of the Fund.
14 (d) The term of office of each trustee shall begin upon
15 January 1 of the year following the year in which he is
16 elected and shall continue for a period of 5 years and until
17 a successor has been elected and qualified, or until prior
18 resignation, death, incapacity or disqualification.
19 (e) Any elected trustee (other than the annuitant
20 trustee) shall be disqualified immediately upon termination
21 of employment with all participating municipalities and
22 instrumentalities thereof or upon any change in status which
23 removes any such trustee from all employments within the
24 group he represents. The annuitant trustee shall be
25 disqualified upon termination of his or her annuity.
26 (f) The trustees shall fill any vacancy in the board by
27 appointment, for the period until the next election of
28 trustees, or, if the remaining term is less than 2 years, for
29 the remainder of the term, and until his successor has been
30 elected and qualified.
31 (g) Trustees shall serve without compensation, but shall
32 be reimbursed for any reasonable expenses incurred in
33 attending meetings of the board and in performing duties on
34 behalf of the Fund and for the amount of any earnings
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1 withheld by any employing municipality or participating
2 instrumentality because of attendance at any board meeting.
3 (h) Each trustee other than the annuitant trustee shall
4 be entitled to one vote on any and all actions before the
5 board; the annuitant trustee is not entitled to vote on any
6 matter. At least 4 concurring votes shall be necessary for
7 every decision or action by the board at any of its meetings.
8 No decision or action shall become effective unless presented
9 and so approved at a regular or duly called special meeting
10 of the board.
11 (Source: P.A. 89-136, eff. 7-14-95.)
12 Section 90. The State Mandates Act is amended by adding
13 Section 8.24 as follows:
14 (30 ILCS 805/8.24 new)
15 Sec. 8.24. Exempt mandate. Notwithstanding Sections 6
16 and 8 of this Act, no reimbursement by the State is required
17 for the implementation of any mandate created by this
18 amendatory Act of the 91st General Assembly.
19 Section 99. Effective date. This Act takes effect upon
20 becoming law.