Rep. Michael J. Madigan

Filed: 4/30/2013

 

 


 

 


 
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1
AMENDMENT TO SENATE BILL 1

2    AMENDMENT NO. ______. Amend Senate Bill 1 by replacing
3everything after the enacting clause with the following:
 
4    "Section 1. Statement and Findings.
5    At the time of passage of this amendatory Act of the 98th
6General Assembly, Illinois possesses a lower credit rating than
7each of the other 49 states. This is a consequence both of
8atypically large debts and of structural imbalances that will,
9unless addressed by the General Assembly, lead to rapidly
10growing debts. The debts include a backlog of bills exceeding
11one-fourth of the State's annual general revenue, substantial
12unfunded liabilities associated with health insurance for
13employees and retirees, and approximately $100 billion in
14unfunded pension liabilities. The structural imbalances result
15from projected growth in non-discretionary and formula-driven
16expenses that significantly outpace projected revenue growth.
17Of the factors that drive this phenomenon, the most substantial

 

 

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1by far is the rapid growth of the annual pension payment, which
2increased nearly $1 billion between Fiscal Year 2012 and Fiscal
3Year 2013, and will again increase nearly $1 billion between
4Fiscal Year 2013 and Fiscal Year 2014, at which time it will
5consume approximately one-fifth of anticipated general
6revenue.
7    The depth of this financial crisis became clear in 2008,
8and since that time, the State has taken significant action to
9ameliorate the State's fiscal troubles. In 2011, the State
10increased the income tax by sixty-seven percent in Public Act
1196-1496. Recognizing that increased revenue alone would not
12solve the problem, the State has enacted a series of budgets
13that included deep cuts to nearly every discretionary program,
14including areas of the budget that are essential in order to
15provide for the health, safety, welfare, and educational
16development of the people of Illinois, such as public
17elementary, secondary, and higher education, human services,
18and public safety.
19    The State has both reduced the size of its workforce and
20reduced discretionary spending. Staffing levels have reduced
21from more than 65,000 in 2001 to the current level of nearly
2244,500. The staffing level is now the lowest it has been in at
23least the last 25 years. Discretionary spending from the
24General Revenue Fund (GRF) has been reduced by over $2.8
25billion since Fiscal Year 2009, including reductions for
26primary education of nearly $1 billion, higher education of

 

 

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1over $230 million, public safety of over $200 million, and
2human services, including health care for the poor, of nearly
3$1.3 million. These reductions have occurred in spite of the
4rising costs of goods and services, which are particularly high
5in the area of medical goods and services, which is a
6significant area of state spending.
7    In 2010, Public Act 96-889 established a package of pension
8benefits for new employees that has been determined to be among
9the least expensive public employee retirement schemes in the
10country. It can be argued that the new package of pension
11benefits has placed government employers at a competitive
12disadvantage, and our public universities, which are vital
13educational and economic institutions, have been exposed to a
14significant risk.
15    In the spring of 2012, the General Assembly made
16significant reductions to the Medicaid program, passage of
17Public Acts 97-687, 97-688, 97-689, 97-690, 97-691, a series of
18reforms to the Medicaid program that is projected to reduce
19State debt by over $2.5 billion each year by decreasing
20services, increasing the rate of taxation of cigarette
21purchases, and accessing available federal funds. The
22reductions include the elimination of a prescription drug
23program for low to middle income seniors, across the board
24provider rate cuts, elimination of health care for adults whose
25families make above 133% of the federal poverty limit ($31,322
26for a family of four), elimination of restorative dental

 

 

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1treatments for adults covered by Medicaid, and utilization
2limits on all remaining services covered by Medicaid. While the
3Medicaid reforms will result in savings for the State, these
4reforms have resulted in the denial of crucial health care to
5hundreds of thousands of needy citizens, threatening to further
6destabilize an already-troubled safety net.
7    The General Assembly took significant steps to reduce the
8cost of current and retired employee health care costs. With
9Public Act 97-695, the General Assembly eliminated provisions
10that require that retired state employees with more than 20
11years of service receive a 100% premium subsidy for retiree
12health care coverage after 20 years of service. Beginning with
13Fiscal Year 2014, State employees will be required to
14contribute significantly more toward healthcare premiums,
15copays, and deductibles. These changes to healthcare will
16result in an estimated savings of more than $900 million over
17the next two fiscal years. However, the backlog of payments to
18providers is estimated to be nearly $1.8 billion at the end of
19Fiscal Year 2013, and providers will experience a delayed
20payment cycle of up to 14 months.
21    Notwithstanding these many steps and their major fiscal,
22economic, and human impact, the fiscal situation in Illinois
23continues to deteriorate. Cuts as well as the inability to pay
24bills due and owing has had a significant impact on each branch
25of government, units of local government, social service
26providers, and other vendors.

 

 

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1    Two-thirds of Illinois school districts are in a budget
2deficit, even after massive layoffs and programmatic
3reductions. For Fiscal Year 2013, General State Aid payments to
4school districts are currently being prorated at 89% of the
5calculated amount. For Fiscal Year 2014, the Governor's
6introduced level of General State Aid payments would result in
7a proration of 82%.
8    Illinois human service providers are experiencing
9extraordinary fiscal pressures, leading to deficit spending,
10discontinued programs, and, increasingly, bankruptcies. On
11January 19, 2012, the Jane Addams Hull House Association, one
12of the oldest and most renowned human service agencies in the
13country, founded by the first Illinoisan to win a Nobel Peace
14Prize, announced it would close due to financial difficulties.
15These manifold challenges have exposed the people of Illinois
16to very substantial harm.
17    Cuts to the budget of the Department of Corrections have
18resulted in the closing of two major prisons and three Adult
19Transitional Centers. Similarly, the Department of Juvenile
20Justice was forced to close two youth centers. Funding for
21probation services to help break the cycle of recidivism and
22improve public safety have steadily declined over the past 5
23years due to the fiscal strain on the state budget. For Fiscal
24Year 2014, the Supreme Court has requested an appropriation to
25meet statutory probation service requirements of $101,229,500;
26however, the Governor has proposed an appropriation of

 

 

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1$47,140,000 - that's 53% less than necessary to fund probation
2services required under law.
3    Illinois has failed to invest the necessary resources to
4maintain a viable transportation plan in recent years. By year
52018, nearly 1 in every 3 miles of roads and 1 in every 10
6bridges will be in an unacceptable condition. Recent reports
7have shown that roughly 8% of bridges in Illinois are
8structurally deficient and 7% of bridges are functionally
9obsolete. Illinois has not been able to invest the necessary
10dollars for state and local roads which has led roughly 73% of
11the roads in the state to be in poor or mediocre condition.
12    The State's credit rating has consistently worsened in the
13assessment of all three major ratings agencies, the State's
14backlog of unpaid bills has not grown smaller, and the various
15non-discretionary and formula-driven expenses whose growth has
16created the lion's share of the problem are projected to
17continue unabated. Under the current payment schedule set in
18Public Act 88-593, the pension payment especially is expected
19to grow extremely rapidly until Fiscal Year 2045.
20    Consequently, the coming months and years will necessarily
21see much more action by the State to achieve fiscal
22stabilization. If these steps toward fiscal stabilization do
23not include pension reform to restrain the growth of the annual
24pension payment, the result will be devastating and dramatic
25cuts to education, public safety, and transportation. The
26impact of such actions on the Illinois economy, and on the

 

 

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1health, safety, welfare, and educational development of the
2people would likely be extremely severe. This harm could
3include significant economic contraction, which would in turn
4exacerbate the underlying fiscal challenge, resulting in a
5downward spiral of standard of living and likely leading to an
6eventual inability of the state to meet its short term
7statutory and Constitutional responsibilities.
8    The State has experienced well-documented pension debt
9problems for many decades. Throughout this time, General
10Assemblies and Governors have struggled to find workable
11solutions. On several occasions, most notably in the instances
12of Public Acts 88-593 and 96-889, reform efforts were heralded
13as comprehensive fixes; these claims have in each instance been
14disproven over time.
15    The inadequacy of past reform efforts has resulted from two
16phenomena. First, reforms have instituted actuarially unsound
17funding schedules that masked the depth of the problem by
18deferring payments far into the future. Indeed, this practice
19led to the Securities and Exchange Commission's charging of
20Illinois with securities fraud in March 2013. Second, steps
21that were taken to reduce costs or generate funds to make
22pension payments were insufficient to make it feasible for the
23State to meet an actuarially sound funding schedule. Simply
24put, reform efforts left the State with an unaffordable pension
25liability, and in order to mask this, the State instituted
26artificial and ultimately ruinous funding schedules.

 

 

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1    The General Assembly has held numerous hearings and
2reviewed hundreds of documents detailing the problem, probable
3solutions, and constitutional issues with proposed reform.
4Given that and all of the above:
5    The General Assembly finds that the fiscal crisis in the
6State of Illinois jeopardizes the health, safety, and welfare
7of the people and compromises the ability to maintain a
8representative and orderly government.
9    The General Assembly finds that the pension debt is so
10great, and the State's fiscal condition is so challenged, that
11it is unclear whether any set of actions by the State that do
12not include substantial reforms to its pension systems can
13result in the full payment of all promised benefits.
14    The General Assembly finds that in order to truly solve the
15State's pension problem, a reform measure must render the
16pension liability affordable on an actuarially sound funding
17schedule, and it must, in a binding fashion, commit the State
18to maintaining this schedule.
19    The General Assembly finds that the reforms in this
20amendatory Act of the 98th General Assembly are necessary to
21address the fiscal crisis without incurring further severe and
22irreparable harm to the public welfare.
23    The General Assembly finds that this amendatory Act of the
2498th General Assembly constitutes the substantial reform of the
25State's pension systems that, along with a series of further
26steps toward fiscal stabilization, will enable the State to

 

 

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1credibly promise the full payment of all pension benefits
2without incurring unacceptable harm to other areas of State
3interest.
4    The General Assembly finds that this amendatory Act of the
598th General Assembly, with its significant cost-savings, its
6institution of an actuarially accepted payment schedule, and
7its historic and binding funding guarantee, is necessary and
8sufficient in order to meet these goals and solve the State's
9pension problem.
 
10    Section 3. The Illinois Public Labor Relations Act is
11amended by changing Sections 4 and 15 and adding Section 7.5 as
12follows:
 
13    (5 ILCS 315/4)  (from Ch. 48, par. 1604)
14    Sec. 4. Management Rights. Employers shall not be required
15to bargain over matters of inherent managerial policy, which
16shall include such areas of discretion or policy as the
17functions of the employer, standards of services, its overall
18budget, the organizational structure and selection of new
19employees, examination techniques and direction of employees.
20Employers, however, shall be required to bargain collectively
21with regard to policy matters directly affecting wages, hours
22and terms and conditions of employment as well as the impact
23thereon upon request by employee representatives, except as
24provided in Section 7.5.

 

 

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1    To preserve the rights of employers and exclusive
2representatives which have established collective bargaining
3relationships or negotiated collective bargaining agreements
4prior to the effective date of this Act, employers shall be
5required to bargain collectively with regard to any matter
6concerning wages, hours or conditions of employment about which
7they have bargained for and agreed to in a collective
8bargaining agreement prior to the effective date of this Act,
9except as provided in Section 7.5.
10    The chief judge of the judicial circuit that employs a
11public employee who is a court reporter, as defined in the
12Court Reporters Act, has the authority to hire, appoint,
13promote, evaluate, discipline, and discharge court reporters
14within that judicial circuit.
15    Nothing in this amendatory Act of the 94th General Assembly
16shall be construed to intrude upon the judicial functions of
17any court. This amendatory Act of the 94th General Assembly
18applies only to nonjudicial administrative matters relating to
19the collective bargaining rights of court reporters.
20(Source: P.A. 94-98, eff. 7-1-05.)
 
21    (5 ILCS 315/7.5 new)
22    Sec. 7.5. Duty to bargain regarding pension amendments.
23Notwithstanding any other provision of this Act, employers
24shall not be required to bargain over matters affected by the
25changes, the impact of changes, and the implementation of

 

 

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1changes made to Article 14, 15, or 16 of the Illinois Pension
2Code, or to Article 1 of that Code as it applies to those
3Articles, made by this amendatory Act of the 98th General
4Assembly or any subsequent Public Act, except with respect to
5an employment contract or collective bargaining agreement that
6is in effect on the effective date of this amendatory Act of
7the 98th General Assembly and has not been amended, renewed, or
8terminated after that date.
9    In case of any conflict between this Section and any other
10provisions of this Act or any other law, the provisions of this
11Act shall control.
 
12    (5 ILCS 315/15)  (from Ch. 48, par. 1615)
13    Sec. 15. Act Takes Precedence.
14    (a) In case of any conflict between the provisions of this
15Act and any other law (other than Section 5 of the State
16Employees Group Insurance Act of 1971 and other than the
17changes made to the Illinois Pension Code by Public Act 96-889
18and other than as provided in Section 7.5 this amendatory Act
19of the 96th General Assembly), executive order or
20administrative regulation relating to wages, hours and
21conditions of employment and employment relations, the
22provisions of this Act or any collective bargaining agreement
23negotiated thereunder shall prevail and control. Nothing in
24this Act shall be construed to replace or diminish the rights
25of employees established by Sections 28 and 28a of the

 

 

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1Metropolitan Transit Authority Act, Sections 2.15 through 2.19
2of the Regional Transportation Authority Act. The provisions of
3this Act are subject to Section 7.5 of this Act and Section 5
4of the State Employees Group Insurance Act of 1971. Nothing in
5this Act shall be construed to replace the necessity of
6complaints against a sworn peace officer, as defined in Section
72(a) of the Uniform Peace Officer Disciplinary Act, from having
8a complaint supported by a sworn affidavit.
9    (b) Except as provided in subsection (a) above, any
10collective bargaining contract between a public employer and a
11labor organization executed pursuant to this Act shall
12supersede any contrary statutes, charters, ordinances, rules
13or regulations relating to wages, hours and conditions of
14employment and employment relations adopted by the public
15employer or its agents. Any collective bargaining agreement
16entered into prior to the effective date of this Act shall
17remain in full force during its duration.
18    (c) It is the public policy of this State, pursuant to
19paragraphs (h) and (i) of Section 6 of Article VII of the
20Illinois Constitution, that the provisions of this Act are the
21exclusive exercise by the State of powers and functions which
22might otherwise be exercised by home rule units. Such powers
23and functions may not be exercised concurrently, either
24directly or indirectly, by any unit of local government,
25including any home rule unit, except as otherwise authorized by
26this Act.

 

 

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1(Source: P.A. 95-331, eff. 8-21-07; 96-889, eff. 1-1-11.)
 
2    Section 5. The Governor's Office of Management and Budget
3Act is amended by changing Sections 7 and 8 as follows:
 
4    (20 ILCS 3005/7)  (from Ch. 127, par. 417)
5    Sec. 7. All statements and estimates of expenditures
6submitted to the Office in connection with the preparation of a
7State budget, and any other estimates of expenditures,
8supporting requests for appropriations, shall be formulated
9according to the various functions and activities for which the
10respective department, office or institution of the State
11government (including the elective officers in the executive
12department and including the University of Illinois and the
13judicial department) is responsible. All such statements and
14estimates of expenditures relating to a particular function or
15activity shall be further formulated or subject to analysis in
16accordance with the following classification of objects:
17    (1) Personal services
18    (2) State contribution for employee group insurance
19    (3) Contractual services
20    (4) Travel
21    (5) Commodities
22    (6) Equipment
23    (7) Permanent improvements
24    (8) Land

 

 

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1    (9) Electronic Data Processing
2    (10) Telecommunication services
3    (11) Operation of Automotive Equipment
4    (12) Contingencies
5    (13) Reserve
6    (14) Interest
7    (15) Awards and Grants
8    (16) Debt Retirement
9    (17) Non-cost Charges.
10    (18) State retirement contribution for annual normal cost
11    (19) State retirement contribution for unfunded accrued
12liability.
13(Source: P.A. 93-25, eff. 6-20-03.)
 
14    (20 ILCS 3005/8)  (from Ch. 127, par. 418)
15    Sec. 8. When used in connection with a State budget or
16expenditure or estimate, items (1) through (16) in the
17classification of objects stated in Section 7 shall have the
18meanings ascribed to those items in Sections 14 through 24.7,
19respectively, of the State Finance Act. "An Act in relation to
20State finance", approved June 10, 1919, as amended.
21    When used in connection with a State budget or expenditure
22or estimate, items (18) and (19) in the classification of
23objects stated in Section 7 shall have the meanings ascribed to
24those items in Sections 24.12 and 24.13, respectively, of the
25State Finance Act.

 

 

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1(Source: P.A. 82-325.)
 
2    Section 10. The State Finance Act is amended by changing
3Section 13 and by adding Sections 24.12 and 24.13 as follows:
 
4    (30 ILCS 105/13)  (from Ch. 127, par. 149)
5    Sec. 13. The objects and purposes for which appropriations
6are made are classified and standardized by items as follows:
7    (1) Personal services;
8    (2) State contribution for employee group insurance;
9    (3) Contractual services;
10    (4) Travel;
11    (5) Commodities;
12    (6) Equipment;
13    (7) Permanent improvements;
14    (8) Land;
15    (9) Electronic Data Processing;
16    (10) Operation of automotive equipment;
17    (11) Telecommunications services;
18    (12) Contingencies;
19    (13) Reserve;
20    (14) Interest;
21    (15) Awards and Grants;
22    (16) Debt Retirement;
23    (17) Non-Cost Charges;
24    (18) State retirement contribution for annual normal cost;

 

 

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1    (19) State retirement contribution for unfunded accrued
2liability;
3    (20) (18) Purchase Contract for Real Estate.
4    When an appropriation is made to an officer, department,
5institution, board, commission or other agency, or to a private
6association or corporation, in one or more of the items above
7specified, such appropriation shall be construed in accordance
8with the definitions and limitations specified in this Act,
9unless the appropriation act otherwise provides.
10    An appropriation for a purpose other than one specified and
11defined in this Act may be made only as an additional, separate
12and distinct item, specifically stating the object and purpose
13thereof.
14(Source: P.A. 84-263; 84-264.)
 
15    (30 ILCS 105/24.12 new)
16    Sec. 24.12. "State retirement contribution for annual
17normal cost" defined. The term "State retirement contribution
18for annual normal cost" means the portion of the total required
19State contribution to a retirement system for a fiscal year
20that represents the State's portion of the System's projected
21normal cost for that fiscal year, as determined and certified
22by the board of trustees of the retirement system in
23conformance with the applicable provisions of the Illinois
24Pension Code.
 

 

 

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1    (30 ILCS 105/24.13 new)
2    Sec. 24.13. "State retirement contribution for unfunded
3accrued liability" defined. The term "State retirement
4contribution for unfunded accrued liability" means the portion
5of the total required State contribution to a retirement system
6for a fiscal year that is not included in the State retirement
7contribution for annual normal cost.
 
8    Section 15. The Budget Stabilization Act is amended by
9changing Sections 20 and 25 as follows:
 
10    (30 ILCS 122/20)
11    Sec. 20. Pension Stabilization Fund.
12    (a) The Pension Stabilization Fund is hereby created as a
13special fund in the State treasury. Moneys in the fund shall be
14used for the sole purpose of making payments to the designated
15retirement systems as provided in Section 25.
16    (b) For each fiscal year when the General Assembly's
17appropriations and transfers or diversions as required by law
18from general funds do not exceed 99% of the estimated general
19funds revenues pursuant to subsection (a) of Section 10, the
20Comptroller shall transfer from the General Revenue Fund as
21provided by this Section a total amount equal to 0.5% of the
22estimated general funds revenues to the Pension Stabilization
23Fund.
24    (c) For each fiscal year through State fiscal year 2014,

 

 

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1when the General Assembly's appropriations and transfers or
2diversions as required by law from general funds do not exceed
398% of the estimated general funds revenues pursuant to
4subsection (b) of Section 10, the Comptroller shall transfer
5from the General Revenue Fund as provided by this Section a
6total amount equal to 1.0% of the estimated general funds
7revenues to the Pension Stabilization Fund.
8    (c-10) In State fiscal year 2020 and each fiscal year
9thereafter until terminated under subsection (c-15), the State
10Comptroller shall order transferred and the State Treasurer
11shall transfer $1,000,000,000 from the General Revenue Fund to
12the Pension Stabilization Fund.
13    (c-15) The transfers made pursuant to subsection (c-10) of
14this Section shall terminate at the end of State fiscal year
152045 or when each of the designated retirement systems, as
16defined in Section 25, has achieved the funding ratio
17prescribed by law for that retirement system, whichever occurs
18first; provided that those transfers shall not be made after
19any provision of this amendatory Act of the 98th General
20Assembly is held invalid other than as applied to a particular
21person or circumstance.
22    (d) The Comptroller shall transfer 1/12 of the total amount
23to be transferred each fiscal year under this Section into the
24Pension Stabilization Fund on the first day of each month of
25that fiscal year or as soon thereafter as possible; except that
26the final transfer of the fiscal year shall be made as soon as

 

 

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1practical after the August 31 following the end of the fiscal
2year.
3    Until State fiscal year 2015, before Before the final
4transfer for a fiscal year is made, the Comptroller shall
5reconcile the estimated general funds revenues used in
6calculating the other transfers under this Section for that
7fiscal year with the actual general funds revenues for that
8fiscal year. The final transfer for the fiscal year shall be
9adjusted so that the total amount transferred under this
10Section for that fiscal year is equal to the percentage
11specified in subsection (b) or (c) of this Section, whichever
12is applicable, of the actual general funds revenues for that
13fiscal year. The actual general funds revenues for the fiscal
14year shall be calculated in a manner consistent with subsection
15(c) of Section 10 of this Act.
16(Source: P.A. 94-839, eff. 6-6-06.)
 
17    (30 ILCS 122/25)
18    Sec. 25. Transfers from the Pension Stabilization Fund.
19    (a) As used in this Section, "designated retirement
20systems" means:
21        (1) the State Employees' Retirement System of
22    Illinois;
23        (2) the Teachers' Retirement System of the State of
24    Illinois;
25        (3) the State Universities Retirement System;

 

 

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1        (4) the Judges Retirement System of Illinois; and
2        (5) the General Assembly Retirement System.
3    (b) As soon as may be practical after any money is
4deposited into the Pension Stabilization Fund, the State
5Comptroller shall apportion the deposited amount among the
6designated retirement systems and the State Comptroller and
7State Treasurer shall pay the apportioned amounts to the
8designated retirement systems. The amount deposited shall be
9apportioned among the designated retirement systems in the same
10proportion as their respective portions of the total actuarial
11reserve deficiency of the designated retirement systems, as
12most recently determined by the Governor's Office of Management
13and Budget. Amounts received by a designated retirement system
14under this Section shall be used for funding the unfunded
15liabilities of the retirement system. Payments under this
16Section are authorized by the continuing appropriation under
17Section 1.7 of the State Pension Funds Continuing Appropriation
18Act.
19    (c) At the request of the State Comptroller, the Governor's
20Office of Management and Budget shall determine the individual
21and total actuarial reserve deficiencies of the designated
22retirement systems. For this purpose, the Governor's Office of
23Management and Budget shall consider the latest available audit
24and actuarial reports of each of the retirement systems and the
25relevant reports and statistics of the Public Pension Division
26of the Department of Financial and Professional Regulation.

 

 

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1    (d) Payments to the designated retirement systems under
2this Section shall be in addition to, and not in lieu of, any
3State contributions required under Section 2-124, 14-131,
415-155, 16-158, or 18-131 of the Illinois Pension Code.
5    Payments to the designated retirement systems under this
6Section, transferred after the effective date of this
7amendatory Act of the 98th General Assembly, do not reduce and
8do not constitute payment of any portion of the required State
9contribution under Article 2, 14, 15, 16, or 18 of the Illinois
10Pension Code in that fiscal year. Such amounts shall not
11reduce, and shall not be included in the calculation of, the
12required State contribution under Article 2, 14, 15, 16, or 18
13of the Illinois Pension Code in any future year, until the
14designated retirement system has received payment of
15contributions pursuant to this Act.
16(Source: P.A. 94-839, eff. 6-6-06.)
 
17    Section 20. The Illinois Pension Code is amended by
18changing Sections 1-103.3, 2-108, 2-108.1, 2-119, 2-119.1,
192-121.1, 2-124, 2-125, 2-126, 2-134, 2-162, 7-109, 7-114,
207-116, 7-139, 9-219, 9-220, 14-103.10, 14-104.3, 14-106,
2114-107, 14-108, 14-110, 14-114, 14-131, 14-132, 14-133,
2214-135.08, 14-152.1, 15-106, 15-107, 15-111, 15-112, 15-113.4,
2315-113.7, 15-125, 15-135, 15-136, 15-155, 15-156, 15-157,
2415-165, 15-198, 16-106, 16-121, 16-127, 16-132, 16-133,
2516-133.1, 16-152, 16-158, 16-158.1, 16-203, 17-116, and 17-134

 

 

09800SB0001ham001- 22 -LRB098 05457 EFG 45203 a

1and by adding Sections 2-105.1, 2-105.2, 2-126.5, 14-103.40,
214-103.41, 14-133.5 15-107.1, 15-107.2, 15-157.5, 16-106.4,
316-106.5, 16-152.5 and 16-158.2 as follows:
 
4    (40 ILCS 5/1-103.3)
5    Sec. 1-103.3. Application of 1994 amendment; funding
6standard.
7    (a) The provisions of Public Act 88-593 this amendatory Act
8of 1994 that change the method of calculating, certifying, and
9paying the required State contributions to the retirement
10systems established under Articles 2, 14, 15, 16, and 18 shall
11first apply to the State contributions required for State
12fiscal year 1996.
13    (b) (Blank) The General Assembly declares that a funding
14ratio (the ratio of a retirement system's total assets to its
15total actuarial liabilities) of 90% is an appropriate goal for
16State-funded retirement systems in Illinois, and it finds that
17a funding ratio of 90% is now the generally-recognized norm
18throughout the nation for public employee retirement systems
19that are considered to be financially secure and funded in an
20appropriate and responsible manner.
21    (c) Every 5 years, beginning in 1999, the Commission on
22Government Forecasting and Accountability, in consultation
23with the affected retirement systems and the Governor's Office
24of Management and Budget (formerly Bureau of the Budget), shall
25consider and determine whether the funding goals 90% funding

 

 

09800SB0001ham001- 23 -LRB098 05457 EFG 45203 a

1ratio adopted in Articles 2, 14, 15, 16, and 18 of this Code
2continue subsection (b) continues to represent an appropriate
3funding goals goal for those State-funded retirement systems in
4Illinois, and it shall report its findings and recommendations
5on this subject to the Governor and the General Assembly.
6(Source: P.A. 93-1067, eff. 1-15-05.)
 
7    (40 ILCS 5/2-105.1 new)
8    Sec. 2-105.1. Tier I participant. "Tier I participant": A
9participant who first became a participant before January 1,
102011.
 
11    (40 ILCS 5/2-105.2 new)
12    Sec. 2-105.2. Tier I retiree. "Tier I retiree" means a
13former Tier I participant who is receiving a retirement
14annuity.
 
15    (40 ILCS 5/2-108)  (from Ch. 108 1/2, par. 2-108)
16    Sec. 2-108. Salary. "Salary": (1) For members of the
17General Assembly, the total compensation paid to the member by
18the State for one year of service, including the additional
19amounts, if any, paid to the member as an officer pursuant to
20Section 1 of "An Act in relation to the compensation and
21emoluments of the members of the General Assembly", approved
22December 6, 1907, as now or hereafter amended.
23    (2) For the State executive officers specified in Section

 

 

09800SB0001ham001- 24 -LRB098 05457 EFG 45203 a

12-105, the total compensation paid to the member for one year
2of service.
3    (3) For members of the System who are participants under
4Section 2-117.1, or who are serving as Clerk or Assistant Clerk
5of the House of Representatives or Secretary or Assistant
6Secretary of the Senate, the total compensation paid to the
7member for one year of service, but not to exceed the salary of
8the highest salaried officer of the General Assembly.
9    However, in the event that federal law results in any
10participant receiving imputed income based on the value of
11group term life insurance provided by the State, such imputed
12income shall not be included in salary for the purposes of this
13Article.
14    Notwithstanding any other provision of this Code, the
15salary of a participant for the purposes of this Code shall not
16exceed, for periods of service in a term of office beginning on
17or after the effective date of this amendatory Act of the 98th
18General Assembly, the greater of (i) the limitation determined
19from time to time under subsection (b-5) of Section 1-160 of
20this Code for persons subject to that Section or (ii) the
21annual salary of the participant during the 365 days
22immediately preceding that effective date.
23    
24(Source: P.A. 86-27; 86-273; 86-1028; 86-1488.)
 
25    (40 ILCS 5/2-108.1)  (from Ch. 108 1/2, par. 2-108.1)

 

 

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1    Sec. 2-108.1. Highest salary for annuity purposes.
2    (a) "Highest salary for annuity purposes" means whichever
3of the following is applicable to the participant:
4    Except as otherwise provided below, for For a participant
5who first becomes a participant of this System before August
610, 2009 (the effective date of Public Act 96-207):
7        (1) For a participant who is a member of the General
8    Assembly on his or her last day of service: the highest
9    salary that is prescribed by law, on the participant's last
10    day of service, for a member of the General Assembly who is
11    not an officer; plus, if the participant was elected or
12    appointed to serve as an officer of the General Assembly
13    for 2 or more years and has made contributions as required
14    under subsection (d) of Section 2-126, the highest
15    additional amount of compensation prescribed by law, at the
16    time of the participant's service as an officer, for
17    members of the General Assembly who serve in that office.
18        (2) For a participant who holds one of the State
19    executive offices specified in Section 2-105 on his or her
20    last day of service: the highest salary prescribed by law
21    for service in that office on the participant's last day of
22    service.
23        (3) For a participant who is Clerk or Assistant Clerk
24    of the House of Representatives or Secretary or Assistant
25    Secretary of the Senate on his or her last day of service:
26    the salary received for service in that capacity on the

 

 

09800SB0001ham001- 26 -LRB098 05457 EFG 45203 a

1    last day of service, but not to exceed the highest salary
2    (including additional compensation for service as an
3    officer) that is prescribed by law on the participant's
4    last day of service for the highest paid officer of the
5    General Assembly.
6        (4) For a participant who is a continuing participant
7    under Section 2-117.1 on his or her last day of service:
8    the salary received for service in that capacity on the
9    last day of service, but not to exceed the highest salary
10    (including additional compensation for service as an
11    officer) that is prescribed by law on the participant's
12    last day of service for the highest paid officer of the
13    General Assembly.
14    Except as otherwise provided below, for For a participant
15who first becomes a participant of this System on or after
16August 10, 2009 (the effective date of Public Act 96-207) and
17before January 1, 2011 (the effective date of Public Act
1896-889), the average monthly salary obtained by dividing the
19total salary of the participant during the period of: (1) the
2048 consecutive months of service within the last 120 months of
21service in which the total compensation was the highest, or (2)
22the total period of service, if less than 48 months, by the
23number of months of service in that period.
24    Except as otherwise provided below, for For a participant
25who first becomes a participant of this System on or after
26January 1, 2011 (the effective date of Public Act 96-889), the

 

 

09800SB0001ham001- 27 -LRB098 05457 EFG 45203 a

1average monthly salary obtained by dividing the total salary of
2the participant during the 96 consecutive months of service
3within the last 120 months of service in which the total
4compensation was the highest by the number of months of service
5in that period; however, for periods of service in a term of
6office beginning on or after January 1, 2011 and before the
7effective date of this amendatory Act of the 98th General
8Assembly, the highest salary for annuity purposes may not
9exceed $106,800, except that that amount shall annually
10thereafter be increased by the lesser of (i) 3% of that amount,
11including all previous adjustments, or (ii) the annual
12unadjusted percentage increase (but not less than zero) in the
13consumer price index-u for the 12 months ending with the
14September preceding each November 1. "Consumer price index-u"
15means the index published by the Bureau of Labor Statistics of
16the United States Department of Labor that measures the average
17change in prices of goods and services purchased by all urban
18consumers, United States city average, all items, 1982-84 =
19100. The new amount resulting from each annual adjustment shall
20be determined by the Public Pension Division of the Department
21of Insurance and made available to the Board by November 1 of
22each year until there is no longer any such participant who is
23in service in a term of office that began before the effective
24date of this amendatory Act of the 98th General Assembly.
25    Notwithstanding any other provision of this Section, in
26determining the highest salary for annuity purposes of a

 

 

09800SB0001ham001- 28 -LRB098 05457 EFG 45203 a

1participant who is in service in a term of office beginning on
2or after the effective date of this amendatory Act of the 98th
3General Assembly, the participant's salary for periods of
4service in a term of office beginning on or after that
5effective date shall not exceed the greater of (i) the
6limitation on salary determined from time to time under
7subsection (b-5) of Section 1-160 of this Code for persons
8subject to that Section or (ii) the annual salary of the
9participant during the 365 days immediately preceding that
10effective date.
11    (b) The earnings limitations of subsection (a) apply to
12earnings under any other participating system under the
13Retirement Systems Reciprocal Act that are considered in
14calculating a proportional annuity under this Article, except
15in the case of a person who first became a member of this
16System before August 22, 1994 and has not, on or after the
17effective date of this amendatory Act of the 97th General
18Assembly, irrevocably elected to have those limitations apply.
19The limitations of subsection (a) shall apply, however, to
20earnings under any other participating system under the
21Retirement Systems Reciprocal Act that are considered in
22calculating the proportional annuity of a person who first
23became a member of this System before August 22, 1994 if, on or
24after the effective date of this amendatory Act of the 97th
25General Assembly, that member irrevocably elects to have those
26limitations apply.

 

 

09800SB0001ham001- 29 -LRB098 05457 EFG 45203 a

1    (c) In calculating the subsection (a) earnings limitation
2to be applied to earnings under any other participating system
3under the Retirement Systems Reciprocal Act for the purpose of
4calculating a proportional annuity under this Article, the
5participant's last day of service shall be deemed to mean the
6last day of service in any participating system from which the
7person has applied for a proportional annuity under the
8Retirement Systems Reciprocal Act.
9(Source: P.A. 96-207, eff. 8-10-09; 96-889, eff. 1-1-11;
1096-1490, eff. 1-1-11; 97-967, eff. 8-16-12.)
 
11    (40 ILCS 5/2-119)  (from Ch. 108 1/2, par. 2-119)
12    Sec. 2-119. Retirement annuity - conditions for
13eligibility.
14    (a) A participant whose service as a member is terminated,
15regardless of age or cause, is entitled to a retirement annuity
16beginning on the date specified by the participant in a written
17application subject to the following conditions:
18        1. The date the annuity begins does not precede the
19    date of final termination of service, or is not more than
20    30 days before the receipt of the application by the board
21    in the case of annuities based on disability or one year
22    before the receipt of the application in the case of
23    annuities based on attained age;
24        2. The participant meets one of the following
25    eligibility requirements:

 

 

09800SB0001ham001- 30 -LRB098 05457 EFG 45203 a

1        For a participant who first becomes a participant of
2    this System before January 1, 2011 (the effective date of
3    Public Act 96-889):
4            (A) He or she has attained age 55 and has at least
5        8 years of service credit;
6            (B) He or she has attained age 62 and terminated
7        service after July 1, 1971 with at least 4 years of
8        service credit; or
9            (C) He or she has completed 8 years of service and
10        has become permanently disabled and as a consequence,
11        is unable to perform the duties of his or her office.
12        For a participant who first becomes a participant of
13    this System on or after January 1, 2011 (the effective date
14    of Public Act 96-889), he or she has attained age 67 and
15    has at least 8 years of service credit.
16    (a-5) Notwithstanding subsection (a) of this Section, for a
17Tier I participant who begins receiving a retirement annuity
18under this Section on or after July 1, 2013:
19        (1) If the Tier I participant is at least 45 years old
20    on the effective date of this amendatory Act of the 98th
21    General Assembly, then the references to age 55 and 62 in
22    subsection (a) of this Section remain unchanged.
23        (2) If the Tier I participant is at least 40 but less
24    than 45 years old on the effective date of this amendatory
25    Act of the 98th General Assembly, then the references to
26    age 55 and 62 in subsection (a) of this Section are

 

 

09800SB0001ham001- 31 -LRB098 05457 EFG 45203 a

1    increased by one year.
2        (3) If the Tier I participant is at least 35 but less
3    than 40 years old on the effective date of this amendatory
4    Act of the 98th General Assembly, then the references to
5    age 55 and 62 in subsection (a) of this Section are
6    increased by 3 years.
7        (4) If the Tier I participant is less than 35 years old
8    on the effective date of this amendatory Act of the 98th
9    General Assembly, then the references to age 55 and 62 in
10    subsection (a) of this Section are increased by 5 years.
11    Notwithstanding Section 1-103.1, this subsection (a-5)
12applies without regard to whether or not the Tier I member is
13in active service under this Article on or after the effective
14date of this amendatory Act of the 98th General Assembly.
15    (a-5) A participant who first becomes a participant of this
16System on or after January 1, 2011 (the effective date of
17Public Act 96-889) who has attained age 62 and has at least 8
18years of service credit may elect to receive the lower
19retirement annuity provided in paragraph (c) of Section
202-119.01 of this Code.
21    (b) A participant shall be considered permanently disabled
22only if: (1) disability occurs while in service and is of such
23a nature as to prevent him or her from reasonably performing
24the duties of his or her office at the time; and (2) the board
25has received a written certificate by at least 2 licensed
26physicians appointed by the board stating that the member is

 

 

09800SB0001ham001- 32 -LRB098 05457 EFG 45203 a

1disabled and that the disability is likely to be permanent.
2(Source: P.A. 96-889, eff. 1-1-11; 96-1490, eff. 1-1-11.)
 
3    (40 ILCS 5/2-119.1)  (from Ch. 108 1/2, par. 2-119.1)
4    Sec. 2-119.1. Automatic increase in retirement annuity.
5    (a) Except as provided in subsections (a-1) and (a-2), a A
6participant who retires after June 30, 1967, and who has not
7received an initial increase under this Section before the
8effective date of this amendatory Act of 1991, shall, in
9January or July next following the first anniversary of
10retirement, whichever occurs first, and in the same month of
11each year thereafter, but in no event prior to age 60, have the
12amount of the originally granted retirement annuity increased
13as follows: for each year through 1971, 1 1/2%; for each year
14from 1972 through 1979, 2%; and for 1980 and each year
15thereafter, 3%. Annuitants who have received an initial
16increase under this subsection prior to the effective date of
17this amendatory Act of 1991 shall continue to receive their
18annual increases in the same month as the initial increase.
19    (a-1) Notwithstanding any other provision of this Article,
20for a Tier I retiree, the amount of each automatic annual
21increase in retirement annuity occurring on or after the
22effective date of this amendatory Act of the 98th General
23Assembly shall be 3% of the lesser of (1) the total annuity
24payable at the time of the increase, including previous
25increases granted, or (2) $1,000 multiplied by the number of

 

 

09800SB0001ham001- 33 -LRB098 05457 EFG 45203 a

1years of creditable service upon which the annuity is based.
2    (a-2) Notwithstanding any other provision of this Article,
3for a Tier I retiree, the monthly retirement annuity shall
4first be subject to annual increases on the January 1 occurring
5on or next after the attainment of age 67 or the January 1
6occurring on or next after the fifth anniversary of the annuity
7start date, whichever occurs earlier. If on the effective date
8of this amendatory Act of the 98th General Assembly a Tier I
9retiree has already received an annual increase under this
10Section but does not yet meet the new eligibility requirements
11of this subsection, the annual increases already received shall
12continue in force, but no additional annual increase shall be
13granted until the Tier I retiree meets the new eligibility
14requirements.
15    (a-3) Notwithstanding Section 1-103.1, subsections (a-1)
16and (a-2) apply without regard to whether or not the Tier I
17retiree is in active service under this Article on or after the
18effective date of this amendatory Act of the 98th General
19Assembly.
20    (b) Beginning January 1, 1990, for eligible participants
21who remain in service after attaining 20 years of creditable
22service, the 3% increases provided under subsection (a) shall
23begin to accrue on the January 1 next following the date upon
24which the participant (1) attains age 55, or (2) attains 20
25years of creditable service, whichever occurs later, and shall
26continue to accrue while the participant remains in service;

 

 

09800SB0001ham001- 34 -LRB098 05457 EFG 45203 a

1such increases shall become payable on January 1 or July 1,
2whichever occurs first, next following the first anniversary of
3retirement. For any person who has service credit in the System
4for the entire period from January 15, 1969 through December
531, 1992, regardless of the date of termination of service, the
6reference to age 55 in clause (1) of this subsection (b) shall
7be deemed to mean age 50.
8    This subsection (b) does not apply to any person who first
9becomes a member of the System after August 8, 2003 (the
10effective date of Public Act 93-494) this amendatory Act of the
1193rd General Assembly.
12    (b-5) Notwithstanding any other provision of this Article,
13a participant who first becomes a participant on or after
14January 1, 2011 (the effective date of Public Act 96-889)
15shall, in January or July next following the first anniversary
16of retirement, whichever occurs first, and in the same month of
17each year thereafter, but in no event prior to age 67, have the
18amount of the originally granted retirement annuity then being
19paid increased by 3% or one-half the annual unadjusted
20percentage increase in the Consumer Price Index for All Urban
21Consumers as determined by the Public Pension Division of the
22Department of Insurance under subsection (b-5) (a) of Section
231-160 2-108.1, whichever is less. The changes made to this
24subsection by this amendatory Act of the 98th General Assembly
25do not apply to any automatic annual increase granted under
26this subsection (b-5) before the effective date of this

 

 

09800SB0001ham001- 35 -LRB098 05457 EFG 45203 a

1amendatory Act.
2    (c) The foregoing provisions relating to automatic
3increases are not applicable to a participant who retires
4before having made contributions (at the rate prescribed in
5Section 2-126) for automatic increases for less than the
6equivalent of one full year. However, in order to be eligible
7for the automatic increases, such a participant may make
8arrangements to pay to the system the amount required to bring
9the total contributions for the automatic increase to the
10equivalent of one year's contributions based upon his or her
11last salary.
12    (d) A participant who terminated service prior to July 1,
131967, with at least 14 years of service is entitled to an
14increase in retirement annuity beginning January, 1976, and to
15additional increases in January of each year thereafter.
16    The initial increase shall be 1 1/2% of the originally
17granted retirement annuity multiplied by the number of full
18years that the annuitant was in receipt of such annuity prior
19to January 1, 1972, plus 2% of the originally granted
20retirement annuity for each year after that date. The
21subsequent annual increases shall be at the rate of 2% of the
22originally granted retirement annuity for each year through
231979 and at the rate of 3% for 1980 and thereafter.
24    (e) Beginning January 1, 1990, all automatic annual
25increases payable under this Section shall be calculated as a
26percentage of the total annuity payable at the time of the

 

 

09800SB0001ham001- 36 -LRB098 05457 EFG 45203 a

1increase, including previous increases granted under this
2Article.
3(Source: P.A. 96-889, eff. 1-1-11; 96-1490, eff. 1-1-11.)
 
4    (40 ILCS 5/2-121.1)  (from Ch. 108 1/2, par. 2-121.1)
5    Sec. 2-121.1. Survivor's annuity - amount.
6    (a) A surviving spouse shall be entitled to 66 2/3% of the
7amount of retirement annuity to which the participant or
8annuitant was entitled on the date of death, without regard to
9whether the participant had attained age 55 prior to his or her
10death, subject to a minimum payment of 10% of salary. If a
11surviving spouse, regardless of age, has in his or her care at
12the date of death any eligible child or children of the
13participant, the survivor's annuity shall be the greater of the
14following: (1) 66 2/3% of the amount of retirement annuity to
15which the participant or annuitant was entitled on the date of
16death, or (2) 30% of the participant's salary increased by 10%
17of salary on account of each such child, subject to a total
18payment for the surviving spouse and children of 50% of salary.
19If eligible children survive but there is no surviving spouse,
20or if the surviving spouse dies or becomes disqualified by
21remarriage while eligible children survive, each eligible
22child shall be entitled to an annuity of 20% of salary, subject
23to a maximum total payment for all such children of 50% of
24salary.
25    However, the survivor's annuity payable under this Section

 

 

09800SB0001ham001- 37 -LRB098 05457 EFG 45203 a

1shall not be less than 100% of the amount of retirement annuity
2to which the participant or annuitant was entitled on the date
3of death, if he or she is survived by a dependent disabled
4child.
5    The salary to be used for determining these benefits shall
6be the salary used for determining the amount of retirement
7annuity as provided in Section 2-119.01.
8    (b) Upon the death of a participant after the termination
9of service or upon death of an annuitant, the maximum total
10payment to a surviving spouse and eligible children, or to
11eligible children alone if there is no surviving spouse, shall
12be 75% of the retirement annuity to which the participant or
13annuitant was entitled, unless there is a dependent disabled
14child among the survivors.
15    (c) When a child ceases to be an eligible child, the
16annuity to that child, or to the surviving spouse on account of
17that child, shall thereupon cease, and the annuity payable to
18the surviving spouse or other eligible children shall be
19recalculated if necessary.
20    Upon the ineligibility of the last eligible child, the
21annuity shall immediately revert to the amount payable upon
22death of a participant or annuitant who leaves no eligible
23children. If the surviving spouse is then under age 50, the
24annuity as revised shall be deferred until the attainment of
25age 50.
26    (d) Beginning January 1, 1990, every survivor's annuity

 

 

09800SB0001ham001- 38 -LRB098 05457 EFG 45203 a

1shall be increased (1) on each January 1 occurring on or after
2the commencement of the annuity if the deceased member died
3while receiving a retirement annuity, or (2) in other cases, on
4each January 1 occurring on or after the first anniversary of
5the commencement of the annuity, by an amount equal to 3% of
6the current amount of the annuity, including any previous
7increases under this Article. Such increases shall apply
8without regard to whether the deceased member was in service on
9or after the effective date of this amendatory Act of 1991, but
10shall not accrue for any period prior to January 1, 1990.
11    (d-5) Notwithstanding any other provision of this Article,
12the initial survivor's annuity of a survivor of a participant
13who first becomes a participant on or after January 1, 2011
14(the effective date of Public Act 96-889) shall be in the
15amount of 66 2/3% of the amount of the retirement annuity to
16which the participant or annuitant was entitled on the date of
17death and shall be increased (1) on each January 1 occurring on
18or after the commencement of the annuity if the deceased member
19died while receiving a retirement annuity or (2) in other
20cases, on each January 1 occurring on or after the first
21anniversary of the commencement of the annuity, by an amount
22equal to 3% or one-half the annual unadjusted percentage
23increase in the Consumer Price Index for All Urban Consumers as
24determined by the Public Pension Division of the Department of
25Insurance under subsection (b-5) (a) of Section 1-160 2-108.1,
26whichever is less, of the originally granted survivor's annuity

 

 

09800SB0001ham001- 39 -LRB098 05457 EFG 45203 a

1then being paid. The changes made to this subsection by this
2amendatory Act of the 98th General Assembly do not apply to any
3automatic annual increase granted under this subsection (d-5)
4before the effective date of this amendatory Act.
5    (e) Notwithstanding any other provision of this Article,
6beginning January 1, 1990, the minimum survivor's annuity
7payable to any person who is entitled to receive a survivor's
8annuity under this Article shall be $300 per month, without
9regard to whether or not the deceased participant was in
10service on the effective date of this amendatory Act of 1989.
11    (f) In the case of a proportional survivor's annuity
12arising under the Retirement Systems Reciprocal Act where the
13amount payable by the System on January 1, 1993 is less than
14$300 per month, the amount payable by the System shall be
15increased beginning on that date by a monthly amount equal to
16$2 for each full year that has expired since the annuity began.
17(Source: P.A. 96-889, eff. 1-1-11; 96-1490, eff. 1-1-11.)
 
18    (40 ILCS 5/2-124)  (from Ch. 108 1/2, par. 2-124)
19    Sec. 2-124. Contributions by State.
20    (a) The State shall make contributions to the System by
21appropriations of amounts which, together with the
22contributions of participants, interest earned on investments,
23and other income will meet the cost of maintaining and
24administering the System on a 100% 90% funded basis in
25accordance with actuarial recommendations by the end of State

 

 

09800SB0001ham001- 40 -LRB098 05457 EFG 45203 a

1fiscal year 2044.
2    (b) The Board shall determine the amount of State
3contributions required for each fiscal year on the basis of the
4actuarial tables and other assumptions adopted by the Board and
5the prescribed rate of interest, using the formula in
6subsection (c).
7    (c) For State fiscal years 2015 through 2044, the minimum
8contribution to the System to be made by the State for each
9fiscal year shall be an amount determined by the System to be
10equal to the sum of (1) the State's portion of the projected
11normal cost for that fiscal year, plus (2) an amount sufficient
12to bring the total assets of the System up to 100% of the total
13actuarial liabilities of the System by the end of State fiscal
14year 2044. In making these determinations, the required State
15contribution shall be calculated each year as a level
16percentage of payroll over the years remaining to and including
17fiscal year 2044 and shall be determined under the entry age
18normal actuarial cost method.
19    For State fiscal years 2012 through 2014 2045, the minimum
20contribution to the System to be made by the State for each
21fiscal year shall be an amount determined by the System to be
22sufficient to bring the total assets of the System up to 90% of
23the total actuarial liabilities of the System by the end of
24State fiscal year 2045. In making these determinations, the
25required State contribution shall be calculated each year as a
26level percentage of payroll over the years remaining to and

 

 

09800SB0001ham001- 41 -LRB098 05457 EFG 45203 a

1including fiscal year 2045 and shall be determined under the
2projected unit credit actuarial cost method.
3    For State fiscal years 1996 through 2005, the State
4contribution to the System, as a percentage of the applicable
5employee payroll, shall be increased in equal annual increments
6so that by State fiscal year 2011, the State is contributing at
7the rate required under this Section.
8    Notwithstanding any other provision of this Article, the
9total required State contribution for State fiscal year 2006 is
10$4,157,000.
11    Notwithstanding any other provision of this Article, the
12total required State contribution for State fiscal year 2007 is
13$5,220,300.
14    For each of State fiscal years 2008 through 2009, the State
15contribution to the System, as a percentage of the applicable
16employee payroll, shall be increased in equal annual increments
17from the required State contribution for State fiscal year
182007, so that by State fiscal year 2011, the State is
19contributing at the rate otherwise required under this Section.
20    Notwithstanding any other provision of this Article, the
21total required State contribution for State fiscal year 2010 is
22$10,454,000 and shall be made from the proceeds of bonds sold
23in fiscal year 2010 pursuant to Section 7.2 of the General
24Obligation Bond Act, less (i) the pro rata share of bond sale
25expenses determined by the System's share of total bond
26proceeds, (ii) any amounts received from the General Revenue

 

 

09800SB0001ham001- 42 -LRB098 05457 EFG 45203 a

1Fund in fiscal year 2010, and (iii) any reduction in bond
2proceeds due to the issuance of discounted bonds, if
3applicable.
4    Notwithstanding any other provision of this Article, the
5total required State contribution for State fiscal year 2011 is
6the amount recertified by the System on or before April 1, 2011
7pursuant to Section 2-134 and shall be made from the proceeds
8of bonds sold in fiscal year 2011 pursuant to Section 7.2 of
9the General Obligation Bond Act, less (i) the pro rata share of
10bond sale expenses determined by the System's share of total
11bond proceeds, (ii) any amounts received from the General
12Revenue Fund in fiscal year 2011, and (iii) any reduction in
13bond proceeds due to the issuance of discounted bonds, if
14applicable.
15    Beginning in State fiscal year 2045, the minimum State
16contribution for each fiscal year shall be the amount needed to
17maintain the total assets of the System at 100% of the total
18actuarial liabilities of the System.
19    Beginning in State fiscal year 2046, the minimum State
20contribution for each fiscal year shall be the amount needed to
21maintain the total assets of the System at 90% of the total
22actuarial liabilities of the System.
23    Amounts received by the System pursuant to Section 25 of
24the Budget Stabilization Act or Section 8.12 of the State
25Finance Act in any fiscal year do not reduce and do not
26constitute payment of any portion of the minimum State

 

 

09800SB0001ham001- 43 -LRB098 05457 EFG 45203 a

1contribution required under this Article in that fiscal year.
2Such amounts shall not reduce, and shall not be included in the
3calculation of, the required State contributions under this
4Article in any future year until the System has reached a
5funding ratio of at least 100% 90%. A reference in this Article
6to the "required State contribution" or any substantially
7similar term does not include or apply to any amounts payable
8to the System under Section 25 of the Budget Stabilization Act.
9    Notwithstanding any other provision of this Section, the
10required State contribution for State fiscal year 2005 and for
11fiscal year 2008 and each fiscal year thereafter through State
12fiscal year 2014, as calculated under this Section and
13certified under Section 2-134, shall not exceed an amount equal
14to (i) the amount of the required State contribution that would
15have been calculated under this Section for that fiscal year if
16the System had not received any payments under subsection (d)
17of Section 7.2 of the General Obligation Bond Act, minus (ii)
18the portion of the State's total debt service payments for that
19fiscal year on the bonds issued in fiscal year 2003 for the
20purposes of that Section 7.2, as determined and certified by
21the Comptroller, that is the same as the System's portion of
22the total moneys distributed under subsection (d) of Section
237.2 of the General Obligation Bond Act. In determining this
24maximum for State fiscal years 2008 through 2010, however, the
25amount referred to in item (i) shall be increased, as a
26percentage of the applicable employee payroll, in equal

 

 

09800SB0001ham001- 44 -LRB098 05457 EFG 45203 a

1increments calculated from the sum of the required State
2contribution for State fiscal year 2007 plus the applicable
3portion of the State's total debt service payments for fiscal
4year 2007 on the bonds issued in fiscal year 2003 for the
5purposes of Section 7.2 of the General Obligation Bond Act, so
6that, by State fiscal year 2011, the State is contributing at
7the rate otherwise required under this Section.
8    (d) For purposes of determining the required State
9contribution to the System, the value of the System's assets
10shall be equal to the actuarial value of the System's assets,
11which shall be calculated as follows:
12    As of June 30, 2008, the actuarial value of the System's
13assets shall be equal to the market value of the assets as of
14that date. In determining the actuarial value of the System's
15assets for fiscal years after June 30, 2008, any actuarial
16gains or losses from investment return incurred in a fiscal
17year shall be recognized in equal annual amounts over the
185-year period following that fiscal year.
19    (e) For purposes of determining the required State
20contribution to the system for a particular year, the actuarial
21value of assets shall be assumed to earn a rate of return equal
22to the system's actuarially assumed rate of return.
23(Source: P.A. 96-43, eff. 7-15-09; 96-1497, eff. 1-14-11;
2496-1511, eff. 1-27-11; 96-1554, eff. 3-18-11; 97-813, eff.
257-13-12.)
 

 

 

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1    (40 ILCS 5/2-125)  (from Ch. 108 1/2, par. 2-125)
2    Sec. 2-125. Obligations of State; funding guarantee.
3    (a) The payment of (1) the required State contributions,
4(2) all benefits granted under this system and (3) all expenses
5of administration and operation are obligations of the State to
6the extent specified in this Article.
7    (b) All income, interest and dividends derived from
8deposits and investments shall be credited to the account of
9the system in the State Treasury and used to pay benefits under
10this Article.
11    (c) Beginning July 1, 2013, the State shall be
12contractually obligated to contribute to the System in each
13State fiscal year an amount not less than the sum of (i) the
14State's normal cost for the year and (ii) the portion of the
15unfunded accrued liability assigned to that year by law.
16Notwithstanding any other provision of law, if the State fails
17to pay an amount guaranteed under this subsection, it shall be
18the mandatory fiduciary obligation of the Board to seek payment
19of the guaranteed amount in compliance with the provisions of
20this Section and, if the amount remains unpaid, to bring a
21mandamus action in the Supreme Court of Illinois to compel the
22State to make the required payment.
23    If the System submits a voucher for contributions required
24under Section 2-124 and the State fails to pay that voucher
25within 90 days of its receipt, the Board shall submit a written
26request to the Comptroller seeking payment. A copy of the

 

 

09800SB0001ham001- 46 -LRB098 05457 EFG 45203 a

1request shall be filed with the Secretary of State, and the
2Secretary of State shall provide a copy to the Governor and
3General Assembly. No earlier than the 16th day after the System
4files the request with the Comptroller and Secretary of State,
5if the amount remains unpaid the Board shall commence a
6mandamus action in the Supreme Court of Illinois to compel the
7Comptroller to satisfy the voucher.
8    This subsection (c) constitutes an express waiver of the
9State's sovereign immunity solely to the extent that it permits
10the Board to commence a mandamus action in the Supreme Court of
11Illinois to compel the Comptroller to pay a voucher for the
12contributions required under Section 2-124.
13    (d) Beginning in State fiscal year 2020, the State shall be
14contractually obligated to make the transfers set forth in
15subsections (c-10) and (c-15) of Section 20 of the Budget
16Stabilization Act and to pay to the System its proportionate
17share of the transferred amounts in accordance with Section 25
18of the Budget Stabilization Act. Notwithstanding any other
19provision of law, if the State fails to transfer an amount
20guaranteed under this subsection or to pay to the System its
21proportionate share of the transferred amount in accordance
22with Section 25 of the Budget Stabilization Act, it shall be
23the mandatory fiduciary obligation of the Board to seek
24transfer or payment of the guaranteed amount in compliance with
25the provisions of this Section and, if the required amount
26remains untransferred or the required payment remains unpaid,

 

 

09800SB0001ham001- 47 -LRB098 05457 EFG 45203 a

1to bring a mandamus action in the Supreme Court of Illinois to
2compel the State to make the required transfer or payment or
3both, as the case may be.
4    If the State fails to make a transfer required under
5subsections (c-10) and (c-15) of Section 20 of the Budget
6Stabilization Act or a payment to the System required under
7Section 25 of that Act, the Board shall submit a written
8request to the Comptroller seeking payment. A copy of the
9request shall be filed with the Secretary of State, and the
10Secretary of State shall provide a copy to the Governor and
11General Assembly. No earlier than the 16th day after the System
12files the request with the Comptroller and Secretary of State,
13if the required amount remains untransferred or the required
14payment remains unpaid, the Board shall commence a mandamus
15action in the Supreme Court of Illinois to compel the
16Comptroller to make the required transfer or payment or both,
17as the case may be.
18    This subsection (d) constitutes an express waiver of the
19State's sovereign immunity solely to the extent that it permits
20the Board to commence a mandamus action in the Supreme Court of
21Illinois to compel the Comptroller to make a transfer required
22under subsections (c-10) and (c-15) of Section 20 of the Budget
23Stabilization Act and to pay to the System its proportionate
24share of the transferred amount in accordance with Section 25
25of the Budget Stabilization Act.
26    The obligations created by this subsection (d) expire when

 

 

09800SB0001ham001- 48 -LRB098 05457 EFG 45203 a

1all of the requirements of subsections (c-10) and (c-15) of
2Section 20 of the Budget Stabilization Act and Section 25 of
3the Budget Stabilization Act have been met.
4    (e) Any payments and transfers required to be made by the
5State pursuant to subsection (c) or (d) are expressly
6subordinate to the payment of the principal, interest, and
7premium, if any, on any bonded debt obligation of the State or
8any other State-created entity, either currently outstanding
9or to be issued, for which the source of repayment or security
10thereon is derived directly or indirectly from tax revenues
11collected by the State or any other State-created entity.
12Payments on such bonded obligations includes any statutory fund
13transfers or other prefunding mechanisms or formulas set forth,
14now or hereafter, in State law or bond indentures, into debt
15service funds or accounts of the State related to such bond
16obligations, consistent with the payment schedules associated
17with such obligations.
18    (f) By the enactment of this amendatory Act of the 98th
19General Assembly, the State of Illinois pledges to and agrees
20with the Board and members of the System that the State will
21make the payments required under Section 2-124 of this Code,
22the transfers required under subsections (c-10) and (c-15) of
23Section 20 of the Budget Stabilization Act, and the payments to
24the System of its proportionate share of the transferred
25amounts in accordance with Section 25 of the Budget
26Stabilization Act. The State further pledges that the State

 

 

09800SB0001ham001- 49 -LRB098 05457 EFG 45203 a

1will not limit or alter the rights and powers vested in the
2Board so as to impair the terms of this Section or in any way
3impair the rights and remedies of the Board.
4(Source: P.A. 83-1440.)
 
5    (40 ILCS 5/2-126)  (from Ch. 108 1/2, par. 2-126)
6    Sec. 2-126. Contributions by participants.
7    (a) Each participant shall contribute toward the cost of
8his or her retirement annuity a percentage of each payment of
9salary received by him or her for service as a member as
10follows: for service between October 31, 1947 and January 1,
111959, 5%; for service between January 1, 1959 and June 30,
121969, 6%; for service between July 1, 1969 and January 10,
131973, 6 1/2%; for service after January 10, 1973, 7%; for
14service after December 31, 1981, 8 1/2%.
15    (a-5) In addition to the contributions otherwise required
16under this Article, each Tier I participant shall also make the
17following contributions toward the cost of his or her
18retirement annuity from each payment of salary received by him
19or her for service as a member:
20        (1) beginning July 1, 2013 and through June 30, 2014,
21    1% of salary; and
22        (2) beginning on July 1, 2014, 2% of salary.
23    (b) Beginning August 2, 1949, each male participant, and
24from July 1, 1971, each female participant shall contribute
25towards the cost of the survivor's annuity 2% of salary.

 

 

09800SB0001ham001- 50 -LRB098 05457 EFG 45203 a

1    A participant who has no eligible survivor's annuity
2beneficiary may elect to cease making contributions for
3survivor's annuity under this subsection. A survivor's annuity
4shall not be payable upon the death of a person who has made
5this election, unless prior to that death the election has been
6revoked and the amount of the contributions that would have
7been paid under this subsection in the absence of the election
8is paid to the System, together with interest at the rate of 4%
9per year from the date the contributions would have been made
10to the date of payment.
11    (c) Beginning July 1, 1967, each participant shall
12contribute 1% of salary towards the cost of automatic increase
13in annuity provided in Section 2-119.1. These contributions
14shall be made concurrently with contributions for retirement
15annuity purposes.
16    (d) In addition, each participant serving as an officer of
17the General Assembly shall contribute, for the same purposes
18and at the same rates as are required of a regular participant,
19on each additional payment received as an officer. If the
20participant serves as an officer for at least 2 but less than 4
21years, he or she shall contribute an amount equal to the amount
22that would have been contributed had the participant served as
23an officer for 4 years. Persons who serve as officers in the
2487th General Assembly but cannot receive the additional payment
25to officers because of the ban on increases in salary during
26their terms may nonetheless make contributions based on those

 

 

09800SB0001ham001- 51 -LRB098 05457 EFG 45203 a

1additional payments for the purpose of having the additional
2payments included in their highest salary for annuity purposes;
3however, persons electing to make these additional
4contributions must also pay an amount representing the
5corresponding employer contributions, as calculated by the
6System.
7    (e) Notwithstanding any other provision of this Article,
8the required contribution of a participant shall not be based
9on any salary in excess of the salary limitation applicable to
10that participant under Section 2-108 or who first becomes a
11participant on or after January 1, 2011 shall not exceed the
12contribution that would be due under this Article if that
13participant's highest salary for annuity purposes were
14$106,800, plus any increases in that amount under Section
152-108.1.
16(Source: P.A. 96-1490, eff. 1-1-11.)
 
17    (40 ILCS 5/2-126.5 new)
18    Sec. 2-126.5. Use of contributions for health care
19subsidies. The System shall not use any contribution received
20by the System under this Article to provide a subsidy for the
21cost of participation in a retiree health care program.
 
22    (40 ILCS 5/2-134)   (from Ch. 108 1/2, par. 2-134)
23    Sec. 2-134. To certify required State contributions and
24submit vouchers.

 

 

09800SB0001ham001- 52 -LRB098 05457 EFG 45203 a

1    (a) The Board shall certify to the Governor on or before
2December 15 of each year through until December 15, 2011 the
3amount of the required State contribution to the System for the
4next fiscal year and shall specifically identify the System's
5projected State normal cost for that fiscal year. The
6certification shall include a copy of the actuarial
7recommendations upon which it is based and shall specifically
8identify the System's projected State normal cost for that
9fiscal year.
10    (a-5) On or before November 1 of each year, beginning
11November 1, 2012, the Board shall submit to the State Actuary,
12the Governor, and the General Assembly a proposed certification
13of the amount of the required State contribution to the System
14for the next fiscal year, along with all of the actuarial
15assumptions, calculations, and data upon which that proposed
16certification is based. On or before January 1 of each year,
17beginning January 1, 2013, the State Actuary shall issue a
18preliminary report concerning the proposed certification and
19identifying, if necessary, recommended changes in actuarial
20assumptions that the Board must consider before finalizing its
21certification of the required State contributions.
22    On or before January 15, 2013 and every January 15
23thereafter, the Board shall certify to the Governor and the
24General Assembly the amount of the required State contribution
25for the next fiscal year. The Board's certification shall
26include a copy of the actuarial recommendations upon which it

 

 

09800SB0001ham001- 53 -LRB098 05457 EFG 45203 a

1is based and shall specifically identify the System's projected
2State normal cost for that fiscal year. The Board's
3certification must note any deviations from the State Actuary's
4recommended changes, the reason or reasons for not following
5the State Actuary's recommended changes, and the fiscal impact
6of not following the State Actuary's recommended changes on the
7required State contribution.
8    (a-7) On or before May 1, 2004, the Board shall recalculate
9and recertify to the Governor the amount of the required State
10contribution to the System for State fiscal year 2005, taking
11into account the amounts appropriated to and received by the
12System under subsection (d) of Section 7.2 of the General
13Obligation Bond Act.
14    On or before July 1, 2005, the Board shall recalculate and
15recertify to the Governor the amount of the required State
16contribution to the System for State fiscal year 2006, taking
17into account the changes in required State contributions made
18by this amendatory Act of the 94th General Assembly.
19    On or before April 1, 2011, the Board shall recalculate and
20recertify to the Governor the amount of the required State
21contribution to the System for State fiscal year 2011, applying
22the changes made by Public Act 96-889 to the System's assets
23and liabilities as of June 30, 2009 as though Public Act 96-889
24was approved on that date.
25    (b) Beginning in State fiscal year 1996, on or as soon as
26possible after the 15th day of each month the Board shall

 

 

09800SB0001ham001- 54 -LRB098 05457 EFG 45203 a

1submit vouchers for payment of State contributions to the
2System, in a total monthly amount of one-twelfth of the
3required annual State contribution certified under subsection
4(a). From the effective date of this amendatory Act of the 93rd
5General Assembly through June 30, 2004, the Board shall not
6submit vouchers for the remainder of fiscal year 2004 in excess
7of the fiscal year 2004 certified contribution amount
8determined under this Section after taking into consideration
9the transfer to the System under subsection (d) of Section
106z-61 of the State Finance Act. These vouchers shall be paid by
11the State Comptroller and Treasurer by warrants drawn on the
12funds appropriated to the System for that fiscal year. If in
13any month the amount remaining unexpended from all other
14appropriations to the System for the applicable fiscal year
15(including the appropriations to the System under Section 8.12
16of the State Finance Act and Section 1 of the State Pension
17Funds Continuing Appropriation Act) is less than the amount
18lawfully vouchered under this Section, the difference shall be
19paid from the General Revenue Fund under the continuing
20appropriation authority provided in Section 1.1 of the State
21Pension Funds Continuing Appropriation Act.
22    (c) The full amount of any annual appropriation for the
23System for State fiscal year 1995 shall be transferred and made
24available to the System at the beginning of that fiscal year at
25the request of the Board. Any excess funds remaining at the end
26of any fiscal year from appropriations shall be retained by the

 

 

09800SB0001ham001- 55 -LRB098 05457 EFG 45203 a

1System as a general reserve to meet the System's accrued
2liabilities.
3(Source: P.A. 96-1497, eff. 1-14-11; 96-1511, eff. 1-27-11;
497-694, eff. 6-18-12.)
 
5    (40 ILCS 5/2-162)
6    Sec. 2-162. Application and expiration of new benefit
7increases.
8    (a) As used in this Section, "new benefit increase" means
9an increase in the amount of any benefit provided under this
10Article, or an expansion of the conditions of eligibility for
11any benefit under this Article, that results from an amendment
12to this Code that takes effect after the effective date of this
13amendatory Act of the 94th General Assembly. "New benefit
14increase", however, does not include any benefit increase
15resulting from the changes made to this Article or Article 1 by
16this amendatory Act of the 98th General Assembly.
17    (b) Notwithstanding any other provision of this Code or any
18subsequent amendment to this Code, every new benefit increase
19is subject to this Section and shall be deemed to be granted
20only in conformance with and contingent upon compliance with
21the provisions of this Section.
22    (c) The Public Act enacting a new benefit increase must
23identify and provide for payment to the System of additional
24funding at least sufficient to fund the resulting annual
25increase in cost to the System as it accrues.

 

 

09800SB0001ham001- 56 -LRB098 05457 EFG 45203 a

1    Every new benefit increase is contingent upon the General
2Assembly providing the additional funding required under this
3subsection. The Commission on Government Forecasting and
4Accountability shall analyze whether adequate additional
5funding has been provided for the new benefit increase and
6shall report its analysis to the Public Pension Division of the
7Department of Financial and Professional Regulation. A new
8benefit increase created by a Public Act that does not include
9the additional funding required under this subsection is null
10and void. If the Public Pension Division determines that the
11additional funding provided for a new benefit increase under
12this subsection is or has become inadequate, it may so certify
13to the Governor and the State Comptroller and, in the absence
14of corrective action by the General Assembly, the new benefit
15increase shall expire at the end of the fiscal year in which
16the certification is made.
17    (d) Every new benefit increase shall expire 5 years after
18its effective date or on such earlier date as may be specified
19in the language enacting the new benefit increase or provided
20under subsection (c). This does not prevent the General
21Assembly from extending or re-creating a new benefit increase
22by law.
23    (e) Except as otherwise provided in the language creating
24the new benefit increase, a new benefit increase that expires
25under this Section continues to apply to persons who applied
26and qualified for the affected benefit while the new benefit

 

 

09800SB0001ham001- 57 -LRB098 05457 EFG 45203 a

1increase was in effect and to the affected beneficiaries and
2alternate payees of such persons, but does not apply to any
3other person, including without limitation a person who
4continues in service after the expiration date and did not
5apply and qualify for the affected benefit while the new
6benefit increase was in effect.
7(Source: P.A. 94-4, eff. 6-1-05.)
 
8    (40 ILCS 5/7-109)  (from Ch. 108 1/2, par. 7-109)
9    Sec. 7-109. Employee.
10    (1) "Employee" means any person who:
11        (a) 1. Receives earnings as payment for the performance
12        of personal services or official duties out of the
13        general fund of a municipality, or out of any special
14        fund or funds controlled by a municipality, or by an
15        instrumentality thereof, or a participating
16        instrumentality, including, in counties, the fees or
17        earnings of any county fee office; and
18            2. Under the usual common law rules applicable in
19        determining the employer-employee relationship, has
20        the status of an employee with a municipality, or any
21        instrumentality thereof, or a participating
22        instrumentality, including aldermen, county
23        supervisors and other persons (excepting those
24        employed as independent contractors) who are paid
25        compensation, fees, allowances or other emolument for

 

 

09800SB0001ham001- 58 -LRB098 05457 EFG 45203 a

1        official duties, and, in counties, the several county
2        fee offices.
3        (b) Serves as a township treasurer appointed under the
4    School Code, as heretofore or hereafter amended, and who
5    receives for such services regular compensation as
6    distinguished from per diem compensation, and any regular
7    employee in the office of any township treasurer whether or
8    not his earnings are paid from the income of the permanent
9    township fund or from funds subject to distribution to the
10    several school districts and parts of school districts as
11    provided in the School Code, or from both such sources; or
12    is the chief executive officer, chief educational officer,
13    chief fiscal officer, or other employee of a Financial
14    Oversight Panel established pursuant to Article 1H of the
15    School Code, other than a superintendent or certified
16    school business official, except that such person shall not
17    be treated as an employee under this Section if that person
18    has negotiated with the Financial Oversight Panel, in
19    conjunction with the school district, a contractual
20    agreement for exclusion from this Section.
21        (c) Holds an elective office in a municipality,
22    instrumentality thereof or participating instrumentality.
23    (2) "Employee" does not include persons who:
24        (a) Are eligible for inclusion under any of the
25    following laws:
26            1. "An Act in relation to an Illinois State

 

 

09800SB0001ham001- 59 -LRB098 05457 EFG 45203 a

1        Teachers' Pension and Retirement Fund", approved May
2        27, 1915, as amended;
3            2. Articles 15 and 16 of this Code.
4        However, such persons shall be included as employees to
5    the extent of earnings that are not eligible for inclusion
6    under the foregoing laws for services not of an
7    instructional nature of any kind.
8        However, any member of the armed forces who is employed
9    as a teacher of subjects in the Reserve Officers Training
10    Corps of any school and who is not certified under the law
11    governing the certification of teachers shall be included
12    as an employee.
13        (b) Are designated by the governing body of a
14    municipality in which a pension fund is required by law to
15    be established for policemen or firemen, respectively, as
16    performing police or fire protection duties, except that
17    when such persons are the heads of the police or fire
18    department and are not eligible to be included within any
19    such pension fund, they shall be included within this
20    Article; provided, that such persons shall not be excluded
21    to the extent of concurrent service and earnings not
22    designated as being for police or fire protection duties.
23    However, (i) any head of a police department who was a
24    participant under this Article immediately before October
25    1, 1977 and did not elect, under Section 3-109 of this Act,
26    to participate in a police pension fund shall be an

 

 

09800SB0001ham001- 60 -LRB098 05457 EFG 45203 a

1    "employee", and (ii) any chief of police who elects to
2    participate in this Fund under Section 3-109.1 of this
3    Code, regardless of whether such person continues to be
4    employed as chief of police or is employed in some other
5    rank or capacity within the police department, shall be an
6    employee under this Article for so long as such person is
7    employed to perform police duties by a participating
8    municipality and has not lawfully rescinded that election.
9        (c) After August 26, 2011 (the effective date of Public
10    Act 97-609), are contributors to or eligible to contribute
11    to a Taft-Hartley pension plan established on or before
12    June 1, 2011 and are employees of a theatre, arena, or
13    convention center that is located in a municipality located
14    in a county with a population greater than 5,000,000, and
15    to which the participating municipality is required to
16    contribute as the person's employer based on earnings from
17    the municipality. Nothing in this paragraph shall affect
18    service credit or creditable service for any period of
19    service prior to August 26, 2011, and this paragraph shall
20    not apply to individuals who are participating in the Fund
21    prior to August 26, 2011.
22        (d) Become an employee of any of the following
23    participating instrumentalities on or after the effective
24    date of this amendatory Act of the 98th General Assembly:
25    the Illinois Municipal League; the Illinois Association of
26    Park Districts; the Illinois Supervisors, County

 

 

09800SB0001ham001- 61 -LRB098 05457 EFG 45203 a

1    Commissioners and Superintendents of Highways Association;
2    an association, or not-for-profit corporation, membership
3    in which is authorized under Section 85-15 of the Township
4    Code; the United Counties Council; or the Will County
5    Governmental League.
6    (3) All persons, including, without limitation, public
7defenders and probation officers, who receive earnings from
8general or special funds of a county for performance of
9personal services or official duties within the territorial
10limits of the county, are employees of the county (unless
11excluded by subsection (2) of this Section) notwithstanding
12that they may be appointed by and are subject to the direction
13of a person or persons other than a county board or a county
14officer. It is hereby established that an employer-employee
15relationship under the usual common law rules exists between
16such employees and the county paying their salaries by reason
17of the fact that the county boards fix their rates of
18compensation, appropriate funds for payment of their earnings
19and otherwise exercise control over them. This finding and this
20amendatory Act shall apply to all such employees from the date
21of appointment whether such date is prior to or after the
22effective date of this amendatory Act and is intended to
23clarify existing law pertaining to their status as
24participating employees in the Fund.
25(Source: P.A. 97-429, eff. 8-16-11; 97-609, eff. 8-26-11;
2697-813, eff. 7-13-12.)
 

 

 

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1    (40 ILCS 5/7-114)  (from Ch. 108 1/2, par. 7-114)
2    Sec. 7-114. Earnings. "Earnings":
3    (a) An amount to be determined by the board, equal to the
4sum of:
5        1. The total amount of money paid to an employee for
6    personal services or official duties as an employee (except
7    those employed as independent contractors) paid out of the
8    general fund, or out of any special funds controlled by the
9    municipality, or by any instrumentality thereof, or
10    participating instrumentality, including compensation,
11    fees, allowances, or other emolument paid for official
12    duties (but not including automobile maintenance, travel
13    expense, or reimbursements for expenditures incurred in
14    the performance of duties, or, in the case of a person who
15    first becomes a participant on or after the effective date
16    of this amendatory Act of the 98th General Assembly,
17    payments for unused sick or vacation time) and, for fee
18    offices, the fees or earnings of the offices to the extent
19    such fees are paid out of funds controlled by the
20    municipality, or instrumentality or participating
21    instrumentality; and
22        2. The money value, as determined by rules prescribed
23    by the governing body of the municipality, or
24    instrumentality thereof, of any board, lodging, fuel,
25    laundry, and other allowances provided an employee in lieu

 

 

09800SB0001ham001- 63 -LRB098 05457 EFG 45203 a

1    of money.
2    (b) For purposes of determining benefits payable under this
3fund payments to a person who is engaged in an independently
4established trade, occupation, profession or business and who
5is paid for his service on a basis other than a monthly or
6other regular salary, are not earnings.
7    (c) If a disabled participating employee is eligible to
8receive Workers' Compensation for an accidental injury and the
9participating municipality or instrumentality which employed
10the participating employee when injured continues to pay the
11participating employee regular salary or other compensation or
12pays the employee an amount in excess of the Workers'
13Compensation amount, then earnings shall be deemed to be the
14total payments, including an amount equal to the Workers'
15Compensation payments. These payments shall be subject to
16employee contributions and allocated as if paid to the
17participating employee when the regular payroll amounts would
18have been paid if the participating employee had continued
19working, and creditable service shall be awarded for this
20period.
21    (d) If an elected official who is a participating employee
22becomes disabled but does not resign and is not removed from
23office, then earnings shall include all salary payments made
24for the remainder of that term of office and the official shall
25be awarded creditable service for the term of office.
26    (e) If a participating employee is paid pursuant to "An Act

 

 

09800SB0001ham001- 64 -LRB098 05457 EFG 45203 a

1to provide for the continuation of compensation for law
2enforcement officers, correctional officers and firemen who
3suffer disabling injury in the line of duty", approved
4September 6, 1973, as amended, the payments shall be deemed
5earnings, and the participating employee shall be awarded
6creditable service for this period.
7    (f) Additional compensation received by a person while
8serving as a supervisor of assessments, assessor, deputy
9assessor or member of a board of review from the State of
10Illinois pursuant to Section 4-10 or 4-15 of the Property Tax
11Code shall not be earnings for purposes of this Article and
12shall not be included in the contribution formula or
13calculation of benefits for such person pursuant to this
14Article.
15(Source: P.A. 87-740; 88-670, eff. 12-2-94.)
 
16    (40 ILCS 5/7-116)  (from Ch. 108 1/2, par. 7-116)
17    Sec. 7-116. "Final rate of earnings":
18    (a) For retirement and survivor annuities, the monthly
19earnings obtained by dividing the total earnings received by
20the employee during the period of either (1) the 48 consecutive
21months of service within the last 120 months of service in
22which his total earnings were the highest or (2) the employee's
23total period of service, by the number of months of service in
24such period.
25    (b) For death benefits, the higher of the rate determined

 

 

09800SB0001ham001- 65 -LRB098 05457 EFG 45203 a

1under paragraph (a) of this Section or total earnings received
2in the last 12 months of service divided by twelve. If the
3deceased employee has less than 12 months of service, the
4monthly final rate shall be the monthly rate of pay the
5employee was receiving when he began service.
6    (c) For disability benefits, the total earnings of a
7participating employee in the last 12 calendar months of
8service prior to the date he becomes disabled divided by 12.
9    (d) In computing the final rate of earnings: (1) the
10earnings rate for all periods of prior service shall be
11considered equal to the average earnings rate for the last 3
12calendar years of prior service for which creditable service is
13received under Section 7-139 or, if there is less than 3 years
14of creditable prior service, the average for the total prior
15service period for which creditable service is received under
16Section 7-139; (2) for out of state service and authorized
17leave, the earnings rate shall be the rate upon which service
18credits are granted; (3) periods of military leave shall not be
19considered; (4) the earnings rate for all periods of disability
20shall be considered equal to the rate of earnings upon which
21the employee's disability benefits are computed for such
22periods; (5) the earnings to be considered for each of the
23final three months of the final earnings period for persons who
24first became participants before January 1, 2012 and the
25earnings to be considered for each of the final 24 months for
26participants who first become participants on or after January

 

 

09800SB0001ham001- 66 -LRB098 05457 EFG 45203 a

11, 2012 shall not exceed 125% of the highest earnings of any
2other month in the final earnings period; and (6) the annual
3amount of final rate of earnings shall be the monthly amount
4multiplied by the number of months of service normally required
5by the position in a year; and (7) in the case of a person who
6first becomes a participant on or after the effective date of
7this amendatory Act of the 98th General Assembly, payments for
8unused sick or vacation time shall not be considered.
9(Source: P.A. 97-609, eff. 1-1-12.)
 
10    (40 ILCS 5/7-139)  (from Ch. 108 1/2, par. 7-139)
11    Sec. 7-139. Credits and creditable service to employees.
12    (a) Each participating employee shall be granted credits
13and creditable service, for purposes of determining the amount
14of any annuity or benefit to which he or a beneficiary is
15entitled, as follows:
16        1. For prior service: Each participating employee who
17    is an employee of a participating municipality or
18    participating instrumentality on the effective date shall
19    be granted creditable service, but no credits under
20    paragraph 2 of this subsection (a), for periods of prior
21    service for which credit has not been received under any
22    other pension fund or retirement system established under
23    this Code, as follows:
24        If the effective date of participation for the
25    participating municipality or participating

 

 

09800SB0001ham001- 67 -LRB098 05457 EFG 45203 a

1    instrumentality is on or before January 1, 1998, creditable
2    service shall be granted for the entire period of prior
3    service with that employer without any employee
4    contribution.
5        If the effective date of participation for the
6    participating municipality or participating
7    instrumentality is after January 1, 1998, creditable
8    service shall be granted for the last 20% of the period of
9    prior service with that employer, but no more than 5 years,
10    without any employee contribution. A participating
11    employee may establish creditable service for the
12    remainder of the period of prior service with that employer
13    by making an application in writing, accompanied by payment
14    of an employee contribution in an amount determined by the
15    Fund, based on the employee contribution rates in effect at
16    the time of application for the creditable service and the
17    employee's salary rate on the effective date of
18    participation for that employer, plus interest at the
19    effective rate from the date of the prior service to the
20    date of payment. Application for this creditable service
21    may be made at any time while the employee is still in
22    service.
23        A municipality that (i) has at least 35 employees; (ii)
24    is located in a county with at least 2,000,000 inhabitants;
25    and (iii) maintains an independent defined benefit pension
26    plan for the benefit of its eligible employees may restrict

 

 

09800SB0001ham001- 68 -LRB098 05457 EFG 45203 a

1    creditable service in whole or in part for periods of prior
2    service with the employer if the governing body of the
3    municipality adopts an irrevocable resolution to restrict
4    that creditable service and files the resolution with the
5    board before the municipality's effective date of
6    participation.
7        Any person who has withdrawn from the service of a
8    participating municipality or participating
9    instrumentality prior to the effective date, who reenters
10    the service of the same municipality or participating
11    instrumentality after the effective date and becomes a
12    participating employee is entitled to creditable service
13    for prior service as otherwise provided in this subdivision
14    (a)(1) only if he or she renders 2 years of service as a
15    participating employee after the effective date.
16    Application for such service must be made while in a
17    participating status. The salary rate to be used in the
18    calculation of the required employee contribution, if any,
19    shall be the employee's salary rate at the time of first
20    reentering service with the employer after the employer's
21    effective date of participation.
22        2. For current service, each participating employee
23    shall be credited with:
24            a. Additional credits of amounts equal to each
25        payment of additional contributions received from him
26        under Section 7-173, as of the date the corresponding

 

 

09800SB0001ham001- 69 -LRB098 05457 EFG 45203 a

1        payment of earnings is payable to him.
2            b. Normal credits of amounts equal to each payment
3        of normal contributions received from him, as of the
4        date the corresponding payment of earnings is payable
5        to him, and normal contributions made for the purpose
6        of establishing out-of-state service credits as
7        permitted under the conditions set forth in paragraph 6
8        of this subsection (a).
9            c. Municipality credits in an amount equal to 1.4
10        times the normal credits, except those established by
11        out-of-state service credits, as of the date of
12        computation of any benefit if these credits would
13        increase the benefit.
14            d. Survivor credits equal to each payment of
15        survivor contributions received from the participating
16        employee as of the date the corresponding payment of
17        earnings is payable, and survivor contributions made
18        for the purpose of establishing out-of-state service
19        credits.
20        3. For periods of temporary and total and permanent
21    disability benefits, each employee receiving disability
22    benefits shall be granted creditable service for the period
23    during which disability benefits are payable. Normal and
24    survivor credits, based upon the rate of earnings applied
25    for disability benefits, shall also be granted if such
26    credits would result in a higher benefit to any such

 

 

09800SB0001ham001- 70 -LRB098 05457 EFG 45203 a

1    employee or his beneficiary.
2        4. For authorized leave of absence without pay: A
3    participating employee shall be granted credits and
4    creditable service for periods of authorized leave of
5    absence without pay under the following conditions:
6            a. An application for credits and creditable
7        service is submitted to the board while the employee is
8        in a status of active employment.
9            b. Not more than 12 complete months of creditable
10        service for authorized leave of absence without pay
11        shall be counted for purposes of determining any
12        benefits payable under this Article.
13            c. Credits and creditable service shall be granted
14        for leave of absence only if such leave is approved by
15        the governing body of the municipality, including
16        approval of the estimated cost thereof to the
17        municipality as determined by the fund, and employee
18        contributions, plus interest at the effective rate
19        applicable for each year from the end of the period of
20        leave to date of payment, have been paid to the fund in
21        accordance with Section 7-173. The contributions shall
22        be computed upon the assumption earnings continued
23        during the period of leave at the rate in effect when
24        the leave began.
25            d. Benefits under the provisions of Sections
26        7-141, 7-146, 7-150 and 7-163 shall become payable to

 

 

09800SB0001ham001- 71 -LRB098 05457 EFG 45203 a

1        employees on authorized leave of absence, or their
2        designated beneficiary, only if such leave of absence
3        is creditable hereunder, and if the employee has at
4        least one year of creditable service other than the
5        service granted for leave of absence. Any employee
6        contributions due may be deducted from any benefits
7        payable.
8            e. No credits or creditable service shall be
9        allowed for leave of absence without pay during any
10        period of prior service.
11        5. For military service: The governing body of a
12    municipality or participating instrumentality may elect to
13    allow creditable service to participating employees who
14    leave their employment to serve in the armed forces of the
15    United States for all periods of such service, provided
16    that the person returns to active employment within 90 days
17    after completion of full time active duty, but no
18    creditable service shall be allowed such person for any
19    period that can be used in the computation of a pension or
20    any other pay or benefit, other than pay for active duty,
21    for service in any branch of the armed forces of the United
22    States. If necessary to the computation of any benefit, the
23    board shall establish municipality credits for
24    participating employees under this paragraph on the
25    assumption that the employee received earnings at the rate
26    received at the time he left the employment to enter the

 

 

09800SB0001ham001- 72 -LRB098 05457 EFG 45203 a

1    armed forces. A participating employee in the armed forces
2    shall not be considered an employee during such period of
3    service and no additional death and no disability benefits
4    are payable for death or disability during such period.
5        Any participating employee who left his employment
6    with a municipality or participating instrumentality to
7    serve in the armed forces of the United States and who
8    again became a participating employee within 90 days after
9    completion of full time active duty by entering the service
10    of a different municipality or participating
11    instrumentality, which has elected to allow creditable
12    service for periods of military service under the preceding
13    paragraph, shall also be allowed creditable service for his
14    period of military service on the same terms that would
15    apply if he had been employed, before entering military
16    service, by the municipality or instrumentality which
17    employed him after he left the military service and the
18    employer costs arising in relation to such grant of
19    creditable service shall be charged to and paid by that
20    municipality or instrumentality.
21        Notwithstanding the foregoing, any participating
22    employee shall be entitled to creditable service as
23    required by any federal law relating to re-employment
24    rights of persons who served in the United States Armed
25    Services. Such creditable service shall be granted upon
26    payment by the member of an amount equal to the employee

 

 

09800SB0001ham001- 73 -LRB098 05457 EFG 45203 a

1    contributions which would have been required had the
2    employee continued in service at the same rate of earnings
3    during the military leave period, plus interest at the
4    effective rate.
5        5.1. In addition to any creditable service established
6    under paragraph 5 of this subsection (a), creditable
7    service may be granted for up to 48 months of service in
8    the armed forces of the United States.
9        In order to receive creditable service for military
10    service under this paragraph 5.1, a participating employee
11    must (1) apply to the Fund in writing and provide evidence
12    of the military service that is satisfactory to the Board;
13    (2) obtain the written approval of the current employer;
14    and (3) make contributions to the Fund equal to (i) the
15    employee contributions that would have been required had
16    the service been rendered as a member, plus (ii) an amount
17    determined by the board to be equal to the employer's
18    normal cost of the benefits accrued for that military
19    service, plus (iii) interest on items (i) and (ii) from the
20    date of first membership in the Fund to the date of
21    payment. The required interest shall be calculated at the
22    regular interest rate.
23        The changes made to this paragraph 5.1 by Public Acts
24    95-483 and 95-486 apply only to participating employees in
25    service on or after August 28, 2007 (the effective date of
26    those Public Acts).

 

 

09800SB0001ham001- 74 -LRB098 05457 EFG 45203 a

1        6. For out-of-state service: Creditable service shall
2    be granted for service rendered to an out-of-state local
3    governmental body under the following conditions: The
4    employee had participated and has irrevocably forfeited
5    all rights to benefits in the out-of-state public employees
6    pension system; the governing body of his participating
7    municipality or instrumentality authorizes the employee to
8    establish such service; the employee has 2 years current
9    service with this municipality or participating
10    instrumentality; the employee makes a payment of
11    contributions, which shall be computed at 8% (normal) plus
12    2% (survivor) times length of service purchased times the
13    average rate of earnings for the first 2 years of service
14    with the municipality or participating instrumentality
15    whose governing body authorizes the service established
16    plus interest at the effective rate on the date such
17    credits are established, payable from the date the employee
18    completes the required 2 years of current service to date
19    of payment. In no case shall more than 120 months of
20    creditable service be granted under this provision.
21        7. For retroactive service: Any employee who could have
22    but did not elect to become a participating employee, or
23    who should have been a participant in the Municipal Public
24    Utilities Annuity and Benefit Fund before that fund was
25    superseded, may receive creditable service for the period
26    of service not to exceed 50 months; however, a current or

 

 

09800SB0001ham001- 75 -LRB098 05457 EFG 45203 a

1    former elected or appointed official of a participating
2    municipality may establish credit under this paragraph 7
3    for more than 50 months of service as an official of that
4    municipality, if the excess over 50 months is approved by
5    resolution of the governing body of the affected
6    municipality filed with the Fund before January 1, 2002.
7        Any employee who is a participating employee on or
8    after September 24, 1981 and who was excluded from
9    participation by the age restrictions removed by Public Act
10    82-596 may receive creditable service for the period, on or
11    after January 1, 1979, excluded by the age restriction and,
12    in addition, if the governing body of the participating
13    municipality or participating instrumentality elects to
14    allow creditable service for all employees excluded by the
15    age restriction prior to January 1, 1979, for service
16    during the period prior to that date excluded by the age
17    restriction. Any employee who was excluded from
18    participation by the age restriction removed by Public Act
19    82-596 and who is not a participating employee on or after
20    September 24, 1981 may receive creditable service for
21    service after January 1, 1979. Creditable service under
22    this paragraph shall be granted upon payment of the
23    employee contributions which would have been required had
24    he participated, with interest at the effective rate for
25    each year from the end of the period of service established
26    to date of payment.

 

 

09800SB0001ham001- 76 -LRB098 05457 EFG 45203 a

1        8. For accumulated unused sick leave: A participating
2    employee who first becomes a participating employee before
3    the effective date of this amendatory Act of the 98th
4    General Assembly and who is applying for a retirement
5    annuity shall be entitled to creditable service for that
6    portion of the employee's accumulated unused sick leave for
7    which payment is not received, as follows:
8            a. Sick leave days shall be limited to those
9        accumulated under a sick leave plan established by a
10        participating municipality or participating
11        instrumentality which is available to all employees or
12        a class of employees.
13            b. Except as provided in item b-1, only sick leave
14        days accumulated with a participating municipality or
15        participating instrumentality with which the employee
16        was in service within 60 days of the effective date of
17        his retirement annuity shall be credited; If the
18        employee was in service with more than one employer
19        during this period only the sick leave days with the
20        employer with which the employee has the greatest
21        number of unpaid sick leave days shall be considered.
22            b-1. If the employee was in the service of more
23        than one employer as defined in item (2) of paragraph
24        (a) of subsection (A) of Section 7-132, then the sick
25        leave days from all such employers shall be credited,
26        as long as the creditable service attributed to those

 

 

09800SB0001ham001- 77 -LRB098 05457 EFG 45203 a

1        sick leave days does not exceed the limitation in item
2        f of this paragraph 8. In calculating the creditable
3        service under this item b-1, the sick leave days from
4        the last employer shall be considered first, then the
5        remaining sick leave days shall be considered until
6        there are no more days or the maximum creditable sick
7        leave threshold under item f of this paragraph 8 has
8        been reached.
9            c. The creditable service granted shall be
10        considered solely for the purpose of computing the
11        amount of the retirement annuity and shall not be used
12        to establish any minimum service period required by any
13        provision of the Illinois Pension Code, the effective
14        date of the retirement annuity, or the final rate of
15        earnings.
16            d. The creditable service shall be at the rate of
17        1/20 of a month for each full sick day, provided that
18        no more than 12 months may be credited under this
19        subdivision 8.
20            e. Employee contributions shall not be required
21        for creditable service under this subdivision 8.
22            f. Each participating municipality and
23        participating instrumentality with which an employee
24        has service within 60 days of the effective date of his
25        retirement annuity shall certify to the board the
26        number of accumulated unpaid sick leave days credited

 

 

09800SB0001ham001- 78 -LRB098 05457 EFG 45203 a

1        to the employee at the time of termination of service.
2        9. For service transferred from another system:
3    Credits and creditable service shall be granted for service
4    under Article 3, 4, 5, 8, 14, or 16 of this Act, to any
5    active member of this Fund, and to any inactive member who
6    has been a county sheriff, upon transfer of such credits
7    pursuant to Section 3-110.3, 4-108.3, 5-235, 8-226.7,
8    14-105.6, or 16-131.4, and payment by the member of the
9    amount by which (1) the employer and employee contributions
10    that would have been required if he had participated in
11    this Fund as a sheriff's law enforcement employee during
12    the period for which credit is being transferred, plus
13    interest thereon at the effective rate for each year,
14    compounded annually, from the date of termination of the
15    service for which credit is being transferred to the date
16    of payment, exceeds (2) the amount actually transferred to
17    the Fund. Such transferred service shall be deemed to be
18    service as a sheriff's law enforcement employee for the
19    purposes of Section 7-142.1.
20        10. For service transferred from an Article 3 system
21    under Section 3-110.8: Credits and creditable service
22    shall be granted for service under Article 3 of this Act as
23    provided in Section 3-110.8, to any active member of this
24    Fund upon transfer of such credits pursuant to Section
25    3-110.8. If the amount by which (1) the employer and
26    employee contributions that would have been required if he

 

 

09800SB0001ham001- 79 -LRB098 05457 EFG 45203 a

1    had participated in this Fund during the period for which
2    credit is being transferred, plus interest thereon at the
3    effective rate for each year, compounded annually, from the
4    date of termination of the service for which credit is
5    being transferred to the date of payment, exceeds (2) the
6    amount actually transferred to the Fund, then the amount of
7    creditable service established under this paragraph 10
8    shall be reduced by a corresponding amount in accordance
9    with the rules and procedures established under this
10    paragraph 10.
11        The board shall establish by rule the manner of making
12    the calculation required under this paragraph 10, taking
13    into account the appropriate actuarial assumptions; the
14    member's service, age, and salary history; the level of
15    funding of the employer; and any other factors that the
16    board determines to be relevant.
17        Until January 1, 2010, members who transferred service
18    from an Article 3 system under the provisions of Public Act
19    94-356 may establish additional credit in this Fund, but
20    only up to the amount of the service credit reduction in
21    that transfer, as calculated under the actuarial
22    assumptions. This credit may be established upon payment by
23    the member of an amount to be determined by the board,
24    equal to (1) the amount that would have been contributed as
25    employee and employer contributions had all the service
26    been as an employee under this Article, plus interest

 

 

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1    thereon compounded annually from the date of service to the
2    date of transfer, less (2) the total amount transferred
3    from the Article 3 system, plus (3) interest on the
4    difference at the effective rate for each year, compounded
5    annually, from the date of the transfer to the date of
6    payment. The additional service credit is allowed under
7    this amendatory Act of the 95th General Assembly
8    notwithstanding the provisions of Article 3 terminating
9    all transferred credits on the date of transfer.
10    (b) Creditable service - amount:
11        1. One month of creditable service shall be allowed for
12    each month for which a participating employee made
13    contributions as required under Section 7-173, or for which
14    creditable service is otherwise granted hereunder. Not
15    more than 1 month of service shall be credited and counted
16    for 1 calendar month, and not more than 1 year of service
17    shall be credited and counted for any calendar year. A
18    calendar month means a nominal month beginning on the first
19    day thereof, and a calendar year means a year beginning
20    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.

 

 

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1        3. An intermittent employee shall be given creditable
2    service for only those months in which a contribution is
3    made under Section 7-173.
4    (c) No application for correction of credits or creditable
5service shall be considered unless the board receives an
6application for correction while (1) the applicant is a
7participating employee and in active employment with a
8participating municipality or instrumentality, or (2) while
9the applicant is actively participating in a pension fund or
10retirement system which is a participating system under the
11Retirement Systems Reciprocal Act. A participating employee or
12other applicant shall not be entitled to credits or creditable
13service unless the required employee contributions are made in
14a lump sum or in installments made in accordance with board
15rule.
16    (d) Upon the granting of a retirement, surviving spouse or
17child annuity, a death benefit or a separation benefit, on
18account of any employee, all individual accumulated credits
19shall thereupon terminate. Upon the withdrawal of additional
20contributions, the credits applicable thereto shall thereupon
21terminate. Terminated credits shall not be applied to increase
22the benefits any remaining employee would otherwise receive
23under this Article.
24(Source: P.A. 96-299, eff. 8-11-09; 97-415, eff. 8-16-11.)
 
25    (40 ILCS 5/9-219)  (from Ch. 108 1/2, par. 9-219)

 

 

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1    Sec. 9-219. Computation of service.
2    (1) In computing the term of service of an employee prior
3to the effective date, the entire period beginning on the date
4he was first appointed and ending on the day before the
5effective date, except any intervening period during which he
6was separated by withdrawal from service, shall be counted for
7all purposes of this Article.
8    (2) In computing the term of service of any employee on or
9after the effective date, the following periods of time shall
10be counted as periods of service for age and service, widow's
11and child's annuity purposes:
12        (a) The time during which he performed the duties of
13    his position.
14        (b) Vacations, leaves of absence with whole or part
15    pay, and leaves of absence without pay not longer than 90
16    days.
17        (c) For an employee who is a member of a county police
18    department or a correctional officer with the county
19    department of corrections, approved leaves of absence
20    without pay during which the employee serves as a full-time
21    officer or employee of an employee association, the
22    membership of which consists of other participants in the
23    Fund, provided that the employee contributes to the Fund
24    (1) the amount that he would have contributed had he
25    remained an active employee in the position he occupied at
26    the time the leave of absence was granted, (2) an amount

 

 

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1    calculated by the Board representing employer
2    contributions, and (3) regular interest thereon from the
3    date of service to the date of payment. However, if the
4    employee's application to establish credit under this
5    subsection is received by the Fund on or after July 1, 2002
6    and before July 1, 2003, the amount representing employer
7    contributions specified in item (2) shall be waived.
8        For a former member of a county police department who
9    has received a refund under Section 9-164, periods during
10    which the employee serves as head of an employee
11    association, the membership of which consists of other
12    police officers, provided that the employee contributes to
13    the Fund (1) the amount that he would have contributed had
14    he remained an active member of the county police
15    department in the position he occupied at the time he left
16    service, (2) an amount calculated by the Board representing
17    employer contributions, and (3) regular interest thereon
18    from the date of service to the date of payment. However,
19    if the former member of the county police department
20    retires on or after January 1, 1993 but no later than March
21    1, 1993, the amount representing employer contributions
22    specified in item (2) shall be waived.
23        For leaves of absence to which this item (c) applies
24    and for other periods to which this item (c) applies,
25    including those leaves of absence and other periods of
26    service beginning before January 5, 2012 (the effective

 

 

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1    date of Public Act 97-651) this amendatory Act of the 97th
2    General Assembly, the employee or former member must
3    continue to remain in sworn status, subject to the
4    professional standards of the public employer or those
5    terms established in statute.
6        (d) Any period of disability for which he received
7    disability benefit or whole or part pay.
8        (e) For a person who first becomes an employee before
9    the effective date of this amendatory Act of the 98th
10    General Assembly, accumulated Accumulated vacation or
11    other time for which an employee who retires on or after
12    November 1, 1990 receives a lump sum payment at the time of
13    retirement, provided that contributions were made to the
14    fund at the time such lump sum payment was received. The
15    service granted for the lump sum payment shall not change
16    the employee's date of withdrawal for computing the
17    effective date of the annuity.
18        (f) An employee who first becomes an employee before
19    the effective date of this amendatory Act of the 98th
20    General Assembly may receive service credit for annuity
21    purposes for accumulated sick leave as of the date of the
22    employee's withdrawal from service, not to exceed a total
23    of 180 days, provided that the amount of such accumulated
24    sick leave is certified by the County Comptroller to the
25    Board and the employee pays an amount equal to 8.5% (9% for
26    members of the County Police Department who are eligible to

 

 

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1    receive an annuity under Section 9-128.1) of the amount
2    that would have been paid had such accumulated sick leave
3    been paid at the employee's final rate of salary. Such
4    payment shall be made within 30 days after the date of
5    withdrawal and prior to receipt of the first annuity check.
6    The service credit granted for such accumulated sick leave
7    shall not change the employee's date of withdrawal for the
8    purpose of computing the effective date of the annuity.
9    (3) In computing the term of service of an employee on or
10after the effective date for ordinary disability benefit
11purposes, the following periods of time shall be counted as
12periods of service:
13        (a) Unless otherwise specified in Section 9-157, the
14    time during which he performed the duties of his position.
15        (b) Paid vacations and leaves of absence with whole or
16    part pay.
17        (c) Any period for which he received duty disability
18    benefit.
19        (d) Any period of disability for which he received
20    whole or part pay.
21    (4) For an employee who on January 1, 1958, was transferred
22by Act of the 70th General Assembly from his position in a
23department of welfare of any city located in the county in
24which this Article is in force and effect to a similar position
25in a department of such county, service shall also be credited
26for ordinary disability benefit and child's annuity for such

 

 

09800SB0001ham001- 86 -LRB098 05457 EFG 45203 a

1period of department of welfare service during which period he
2was a contributor to a statutory annuity and benefit fund in
3such city and for which purposes service credit would otherwise
4not be credited by virtue of such involuntary transfer.
5    (5) An employee described in subsection (e) of Section
69-108 shall receive credit for child's annuity and ordinary
7disability benefit for the period of time for which he was
8credited with service in the fund from which he was
9involuntarily separated through class or group transfer;
10provided, that no such credit shall be allowed to the extent
11that it results in a duplication of credits or benefits, and
12neither shall such credit be allowed to the extent that it was
13or may be forfeited by the application for and acceptance of a
14refund from the fund from which the employee was transferred.
15    (6) Overtime or extra service shall not be included in
16computing service. Not more than 1 year of service shall be
17allowed for service rendered during any calendar year.
18    (7) Unused sick or vacation time shall not be used to
19compute the service of an employee who first becomes an
20employee on or after the effective date of this amendatory Act
21of the 98th General Assembly.
22(Source: P.A. 97-651, eff. 1-5-12.)
 
23    (40 ILCS 5/9-220)  (from Ch. 108 1/2, par. 9-220)
24    Sec. 9-220. Basis of service credit.
25    (a) In computing the period of service of any employee for

 

 

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1annuity purposes under Section 9-134, the following provisions
2shall govern:
3        (1) All periods prior to the effective date shall be
4    computed in accordance with the provisions governing the
5    computation of such service.
6        (2) Service on or after the effective date shall
7    include:
8            (i) The actual period of time the employee
9        contributes or has contributed to the fund for service
10        rendered to age 65 plus the actual period of time after
11        age 65 for which the employee performs the duties of
12        his position or performs such duties and is given a
13        county contribution for age and service annuity or
14        minimum annuity purposes.
15            (ii) Leaves of absence from duty, or vacation, for
16        which an employee receives all or part of his salary.
17            (iii) For a person who first becomes an employee
18        before the effective date of this amendatory Act of the
19        98th General Assembly, accumulated Accumulated
20        vacation or other time for which an employee who
21        retires on or after November 1, 1990 receives a lump
22        sum payment at the time of retirement, provided that
23        contributions were made to the fund at the time such
24        lump sum payment was received. The service granted for
25        the lump sum payment shall not change the employee's
26        date of withdrawal for computing the effective date of

 

 

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1        the annuity.
2            (iv) For a person who first becomes an employee
3        before the effective date of this amendatory Act of the
4        98th General Assembly, accumulated Accumulated sick
5        leave as of the date of the employee's withdrawal from
6        service, not to exceed a total of 180 days, provided
7        that the amount of such accumulated sick leave is
8        certified by the County Comptroller to the Board and
9        the employee pays an amount equal to 8.5% (9% for
10        members of the County Police Department who are
11        eligible to receive an annuity under Section 9-128.1)
12        of the amount that would have been paid had such
13        accumulated sick leave been paid at the employee's
14        final rate of salary. Such payment shall be made within
15        30 days after the date of withdrawal and prior to
16        receipt of the first annuity check. The service credit
17        granted for such accumulated sick leave shall not
18        change the employee's date of withdrawal for the
19        purpose of computing the effective date of the annuity.
20            (v) Periods during which the employee has had
21        contributions for annuity purposes made for him in
22        accordance with law while on military leave of absence
23        during World War II.
24            (vi) Periods during which the employee receives a
25        disability benefit under this Article.
26            (vii) For any person who first becomes a member on

 

 

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1        or after January 1, 2011, the actual period of time the
2        employee contributes or has contributed to the fund for
3        service rendered up to the limitation on salary in
4        subsection (b-5) of Section 1-160 plus the actual
5        period of time thereafter for which the employee
6        performs the duties of his position and ceased
7        contributing due to the salary limitation in
8        subsection (b-5) of Section 1-160.
9        (3) The right to have certain periods of time
10    considered as service as stated in paragraph (2) of Section
11    9-164 shall not apply for annuity purposes unless the
12    refunds shall have been repaid in accordance with this
13    Article.
14        (4) All service shall be computed in whole calendar
15    months, and at least 15 days of service in any one calendar
16    month shall constitute one calendar month of service, and 1
17    year of service shall be equal to the number of months,
18    days or hours for which an appropriation was made in the
19    annual appropriation ordinance for the position held by the
20    employee.
21        (5) Unused sick or vacation time shall not be used to
22    compute the service of an employee who first becomes an
23    employee on or after the effective date of this amendatory
24    Act of the 98th General Assembly.
25    (b) For all other annuity purposes of this Article the
26following schedule shall govern the computation of a year of

 

 

09800SB0001ham001- 90 -LRB098 05457 EFG 45203 a

1service of an employee whose salary or wages is on the basis
2stated, and any fractional part of a year of service shall be
3determined according to said schedule:
4    Annual or Monthly Basis: Service during 4 months in any 1
5calendar year;
6    Weekly Basis: Service during any 17 weeks of any 1 calendar
7year, and service during any week shall constitute a week of
8service;
9    Daily Basis: Service during 100 days in any 1 calendar
10year, and service during any day shall constitute a day of
11service;
12    Hourly Basis: Service during 800 hours in any 1 calendar
13year, and service during any hour shall constitute an hour of
14service.
15(Source: P.A. 96-1490, eff. 1-1-11.)
 
16    (40 ILCS 5/14-103.10)  (from Ch. 108 1/2, par. 14-103.10)
17    Sec. 14-103.10. Compensation.
18    (a) For periods of service prior to January 1, 1978, the
19full rate of salary or wages payable to an employee for
20personal services performed if he worked the full normal
21working period for his position, subject to the following
22maximum amounts: (1) prior to July 1, 1951, $400 per month or
23$4,800 per year; (2) between July 1, 1951 and June 30, 1957
24inclusive, $625 per month or $7,500 per year; (3) beginning
25July 1, 1957, no limitation.

 

 

09800SB0001ham001- 91 -LRB098 05457 EFG 45203 a

1    In the case of service of an employee in a position
2involving part-time employment, compensation shall be
3determined according to the employees' earnings record.
4    (b) For periods of service on and after January 1, 1978,
5all remuneration for personal services performed defined as
6"wages" under the Social Security Enabling Act, including that
7part of such remuneration which is in excess of any maximum
8limitation provided in such Act, and including any benefits
9received by an employee under a sick pay plan in effect before
10January 1, 1981, but excluding lump sum salary payments:
11        (1) for vacation,
12        (2) for accumulated unused sick leave,
13        (3) upon discharge or dismissal,
14        (4) for approved holidays.
15    (c) For periods of service on or after December 16, 1978,
16compensation also includes any benefits, other than lump sum
17salary payments made at termination of employment, which an
18employee receives or is eligible to receive under a sick pay
19plan authorized by law.
20    (d) For periods of service after September 30, 1985,
21compensation also includes any remuneration for personal
22services not included as "wages" under the Social Security
23Enabling Act, which is deducted for purposes of participation
24in a program established pursuant to Section 125 of the
25Internal Revenue Code or its successor laws.
26    (e) For members for which Section 1-160 applies for periods

 

 

09800SB0001ham001- 92 -LRB098 05457 EFG 45203 a

1of service on and after January 1, 2011, all remuneration for
2personal services performed defined as "wages" under the Social
3Security Enabling Act, excluding remuneration that is in excess
4of the annual earnings, salary, or wages of a member or
5participant, as provided in subsection (b-5) of Section 1-160,
6but including any benefits received by an employee under a sick
7pay plan in effect before January 1, 1981. Compensation shall
8exclude lump sum salary payments:
9        (1) for vacation;
10        (2) for accumulated unused sick leave;
11        (3) upon discharge or dismissal; and
12        (4) for approved holidays.
13    (f) Notwithstanding any other provision of this Code, the
14compensation of a Tier I member for the purposes of this Code
15shall not exceed, for periods of service on or after the
16effective date of this amendatory Act of the 98th General
17Assembly, the greater of (i) the limitation determined from
18time to time under subsection (b-5) of Section 1-160 of this
19Code for persons subject to that Section or (ii) the annual
20compensation of the member during the 365 days immediately
21preceding that effective date; except that this limitation does
22not apply to a member's compensation that is determined under
23an employment contract or collective bargaining agreement that
24is in effect on the effective date of this amendatory Act of
25the 98th General Assembly and has not been amended or renewed
26after that date.

 

 

09800SB0001ham001- 93 -LRB098 05457 EFG 45203 a

1(Source: P.A. 96-1490, eff. 1-1-11.)
 
2    (40 ILCS 5/14-103.40 new)
3    Sec. 14-103.40. Tier I member. "Tier I member": A member of
4this System who first became a member or participant before
5January 1, 2011 under any reciprocal retirement system or
6pension fund established under this Code other than a
7retirement system or pension fund established under Article 2,
83, 4, 5, 6, or 18 of this Code.
 
9    (40 ILCS 5/14-103.41 new)
10    Sec. 14-103.41. Tier I retiree. "Tier I retiree": A former
11Tier I member who is receiving a retirement annuity.
 
12    (40 ILCS 5/14-104.3)  (from Ch. 108 1/2, par. 14-104.3)
13    Sec. 14-104.3. Notwithstanding provisions contained in
14Section 14-103.10, any person who first becomes a member before
15the effective date of this amendatory Act of the 98th General
16Assembly and who at the time of retirement and after December
176, 1983 receives compensation in a lump sum for accumulated
18vacation, sickness, or personal business may receive service
19credit for such periods by making contributions within 90 days
20of withdrawal, based on the rate of compensation in effect
21immediately prior to retirement and the contribution rate then
22in effect. Any person who first becomes a member on or after
23the effective date of this amendatory Act of the 98th General

 

 

09800SB0001ham001- 94 -LRB098 05457 EFG 45203 a

1Assembly and who receives compensation in a lump sum for
2accumulated vacation, sickness, or personal business may not
3receive service credit for such periods. Exercising the option
4provided in this Section shall not change a member's date of
5withdrawal or final average compensation for purposes of
6computing the amount or effective date of a retirement annuity.
7Any annuitant who establishes service credit as herein provided
8shall have his retirement annuity adjusted retroactively to the
9date of retirement.
10(Source: P.A. 83-1362.)
 
11    (40 ILCS 5/14-106)  (from Ch. 108 1/2, par. 14-106)
12    Sec. 14-106. Membership service credit.
13    (a) After January 1, 1944, all service of a member since he
14last became a member with respect to which contributions are
15made shall count as membership service; provided, that for
16service on and after July 1, 1950, 12 months of service shall
17constitute a year of membership service, the completion of 15
18days or more of service during any month shall constitute 1
19month of membership service, 8 to 15 days shall constitute 1/2
20month of membership service and less than 8 days shall
21constitute 1/4 month of membership service. The payroll record
22of each department shall constitute conclusive evidence of the
23record of service rendered by a member.
24    (b) For a member who is employed and paid on an
25academic-year basis rather than on a 12-month annual basis,

 

 

09800SB0001ham001- 95 -LRB098 05457 EFG 45203 a

1employment for a full academic year shall constitute a full
2year of membership service, except that the member shall not
3receive more than one year of membership service credit (plus
4any additional service credit granted for unused sick leave)
5for service during any 12-month period. This subsection (b)
6applies to all such service for which the member has not begun
7to receive a retirement annuity before January 1, 2001.
8    (c) A person who first becomes a member before the
9effective date of this amendatory Act of the 98th General
10Assembly shall be entitled to additional service credit, under
11rules prescribed by the Board, for accumulated unused sick
12leave credited to his account in the last Department on the
13date of withdrawal from service or for any period for which he
14would have been eligible to receive benefits under a sick pay
15plan authorized by law, if he had suffered a sickness or
16accident on the date of withdrawal from service. It shall be
17the responsibility of the last Department to certify to the
18Board the length of time salary or benefits would have been
19paid to the member based upon the accumulated unused sick leave
20or the applicable sick pay plan if he had become entitled
21thereto because of sickness on the date that his status as an
22employee terminated. This period of service credit granted
23under this paragraph shall not be considered in determining the
24date the retirement annuity is to begin, or final average
25compensation.
26    (d) A person who first becomes a member on or after the

 

 

09800SB0001ham001- 96 -LRB098 05457 EFG 45203 a

1effective date of this amendatory Act of the 98th General
2Assembly shall not be entitled to additional service credit for
3accumulated unused sick leave.
4(Source: P.A. 92-14, eff. 6-28-01.)
 
5    (40 ILCS 5/14-107)  (from Ch. 108 1/2, par. 14-107)
6    Sec. 14-107. Retirement annuity - service and age -
7conditions.
8    (a) A member is entitled to a retirement annuity after
9having at least 8 years of creditable service.
10    (b) A member who has at least 35 years of creditable
11service may claim his or her retirement annuity at any age. A
12member having at least 8 years of creditable service but less
13than 35 may claim his or her retirement annuity upon or after
14attainment of age 60 or, beginning January 1, 2001, any lesser
15age which, when added to the number of years of his or her
16creditable service, equals at least 85. A member upon or after
17attainment of age 55 having at least 25 years of creditable
18service (30 years if retirement is before January 1, 2001) may
19elect to receive the lower retirement annuity provided in
20paragraph (c) of Section 14-108 of this Code. For purposes of
21the rule of 85, portions of years shall be counted in whole
22months.
23    (c) Notwithstanding subsection (b) of this Section, for a
24Tier I member who begins receiving a retirement annuity under
25this Article on or after July 1, 2013:

 

 

09800SB0001ham001- 97 -LRB098 05457 EFG 45203 a

1        (1) If the Tier I member is at least 45 years old on
2    the effective date of this amendatory Act of the 98th
3    General Assembly, then the references to age 55 and 60 in
4    subsection (b) of this Section remain unchanged and the
5    references to 85 in subsection (b) of this Section remain
6    unchanged.
7        (2) If the Tier I member is at least 40 but less than
8    45 years old on the effective date of this amendatory Act
9    of the 98th General Assembly, then the references to age 55
10    and 60 in subsection (b) of this Section are increased by
11    one year and the references to 85 in subsection (b) are
12    increased to 87.
13        (3) If the Tier I member is at least 35 but less than
14    40 years old on the effective date of this amendatory Act
15    of the 98th General Assembly, then the references to age 55
16    and 60 in subsection (b) of this Section are increased by 3
17    years and the references to 85 in subsection (b) are
18    increased to 91.
19        (4) If the Tier I member is less than 35 years old on
20    the effective date of this amendatory Act of the 98th
21    General Assembly, then the references to age 55 and 60 in
22    subsection (b) of this Section are increased by 5 years and
23    the references to 85 in subsection (b) are increased to 95.
24    Notwithstanding Section 1-103.1, this subsection (c)
25applies without regard to whether or not the Tier I member is
26in active service under this Article on or after the effective

 

 

09800SB0001ham001- 98 -LRB098 05457 EFG 45203 a

1date of this amendatory Act of the 98th General Assembly.
2    (d) The allowance shall begin with the first full calendar
3month specified in the member's application therefor, the first
4day of which shall not be before the date of withdrawal as
5approved by the board. Regardless of the date of withdrawal,
6the allowance need not begin within one year of application
7therefor.
8(Source: P.A. 91-927, eff. 12-14-00.)
 
9    (40 ILCS 5/14-108)  (from Ch. 108 1/2, par. 14-108)
10    Sec. 14-108. Amount of retirement annuity. A member who has
11contributed to the System for at least 12 months shall be
12entitled to a prior service annuity for each year of certified
13prior service credited to him, except that a member shall
14receive 1/3 of the prior service annuity for each year of
15service for which contributions have been made and all of such
16annuity shall be payable after the member has made
17contributions for a period of 3 years. Proportionate amounts
18shall be payable for service of less than a full year after
19completion of at least 12 months.
20    The total period of service to be considered in
21establishing the measure of prior service annuity shall include
22service credited in the Teachers' Retirement System of the
23State of Illinois and the State Universities Retirement System
24for which contributions have been made by the member to such
25systems; provided that at least 1 year of the total period of 3

 

 

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1years prescribed for the allowance of a full measure of prior
2service annuity shall consist of membership service in this
3system for which credit has been granted.
4    (a) In the case of a member who retires on or after January
51, 1998 and is a noncovered employee, the retirement annuity
6for membership service and prior service shall be 2.2% of final
7average compensation for each year of service. Any service
8credit established as a covered employee shall be computed as
9stated in paragraph (b).
10    (b) In the case of a member who retires on or after January
111, 1998 and is a covered employee, the retirement annuity for
12membership service and prior service shall be computed as
13stated in paragraph (a) for all service credit established as a
14noncovered employee; for service credit established as a
15covered employee it shall be 1.67% of final average
16compensation for each year of service.
17    (c) For a member retiring after attaining age 55 but before
18age 60 with at least 30 but less than 35 years of creditable
19service if retirement is before January 1, 2001, or with at
20least 25 but less than 30 years of creditable service if
21retirement is on or after January 1, 2001, the retirement
22annuity shall be reduced by 1/2 of 1% for each month that the
23member's age is under age 60 at the time of retirement. For
24members to whom subsection (c) of Section 14-107 applies, the
25references to age 55 and 60 in this subsection (c) are
26increased as provided in subsection (c) of Section 14-107.

 

 

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1    (d) A retirement annuity shall not exceed 75% of final
2average compensation, subject to such extension as may result
3from the application of Section 14-114 or Section 14-115.
4    (e) The retirement annuity payable to any covered employee
5who is a member of the System and in service on January 1,
61969, or in service thereafter in 1969 as a result of
7legislation enacted by the Illinois General Assembly
8transferring the member to State employment from county
9employment in a county Department of Public Aid in counties of
103,000,000 or more population, under a plan of coordination with
11the Old Age, Survivors and Disability provisions thereof, if
12not fully insured for Old Age Insurance payments under the
13Federal Old Age, Survivors and Disability Insurance provisions
14at the date of acceptance of a retirement annuity, shall not be
15less than the amount for which the member would have been
16eligible if coordination were not applicable.
17    (f) The retirement annuity payable to any covered employee
18who is a member of the System and in service on January 1,
191969, or in service thereafter in 1969 as a result of the
20legislation designated in the immediately preceding paragraph,
21if fully insured for Old Age Insurance payments under the
22Federal Social Security Act at the date of acceptance of a
23retirement annuity, shall not be less than an amount which when
24added to the Primary Insurance Benefit payable to the member
25upon attainment of age 65 under such Federal Act, will equal
26the annuity which would otherwise be payable if the coordinated

 

 

09800SB0001ham001- 101 -LRB098 05457 EFG 45203 a

1plan of coverage were not applicable.
2    (g) In the case of a member who is a noncovered employee,
3the retirement annuity for membership service as a security
4employee of the Department of Corrections or security employee
5of the Department of Human Services shall be: if retirement
6occurs on or after January 1, 2001, 3% of final average
7compensation for each year of creditable service; or if
8retirement occurs before January 1, 2001, 1.9% of final average
9compensation for each of the first 10 years of service, 2.1%
10for each of the next 10 years of service, 2.25% for each year
11of service in excess of 20 but not exceeding 30, and 2.5% for
12each year in excess of 30; except that the annuity may be
13calculated under subsection (a) rather than this subsection (g)
14if the resulting annuity is greater.
15    (h) In the case of a member who is a covered employee, the
16retirement annuity for membership service as a security
17employee of the Department of Corrections or security employee
18of the Department of Human Services shall be: if retirement
19occurs on or after January 1, 2001, 2.5% of final average
20compensation for each year of creditable service; if retirement
21occurs before January 1, 2001, 1.67% of final average
22compensation for each of the first 10 years of service, 1.90%
23for each of the next 10 years of service, 2.10% for each year
24of service in excess of 20 but not exceeding 30, and 2.30% for
25each year in excess of 30.
26    (i) For the purposes of this Section and Section 14-133 of

 

 

09800SB0001ham001- 102 -LRB098 05457 EFG 45203 a

1this Act, the term "security employee of the Department of
2Corrections" and the term "security employee of the Department
3of Human Services" shall have the meanings ascribed to them in
4subsection (c) of Section 14-110.
5    (j) The retirement annuity computed pursuant to paragraphs
6(g) or (h) shall be applicable only to those security employees
7of the Department of Corrections and security employees of the
8Department of Human Services who have at least 20 years of
9membership service and who are not eligible for the alternative
10retirement annuity provided under Section 14-110. However,
11persons transferring to this System under Section 14-108.2 or
1214-108.2c who have service credit under Article 16 of this Code
13may count such service toward establishing their eligibility
14under the 20-year service requirement of this subsection; but
15such service may be used only for establishing such
16eligibility, and not for the purpose of increasing or
17calculating any benefit.
18    (k) (Blank).
19    (l) The changes to this Section made by this amendatory Act
20of 1997 (changing certain retirement annuity formulas from a
21stepped rate to a flat rate) apply to members who retire on or
22after January 1, 1998, without regard to whether employment
23terminated before the effective date of this amendatory Act of
241997. An annuity shall not be calculated in steps by using the
25new flat rate for some steps and the superseded stepped rate
26for other steps of the same type of service.

 

 

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1(Source: P.A. 91-927, eff. 12-14-00; 92-14, eff. 6-28-01.)
 
2    (40 ILCS 5/14-110)  (from Ch. 108 1/2, par. 14-110)
3    Sec. 14-110. Alternative retirement annuity.
4    (a) Any member who has withdrawn from service with not less
5than 20 years of eligible creditable service and has attained
6age 55, and any member who has withdrawn from service with not
7less than 25 years of eligible creditable service and has
8attained age 50, regardless of whether the attainment of either
9of the specified ages occurs while the member is still in
10service, shall be entitled to receive at the option of the
11member, in lieu of the regular or minimum retirement annuity, a
12retirement annuity computed as follows:
13        (i) for periods of service as a noncovered employee: if
14    retirement occurs on or after January 1, 2001, 3% of final
15    average compensation for each year of creditable service;
16    if retirement occurs before January 1, 2001, 2 1/4% of
17    final average compensation for each of the first 10 years
18    of creditable service, 2 1/2% for each year above 10 years
19    to and including 20 years of creditable service, and 2 3/4%
20    for each year of creditable service above 20 years; and
21        (ii) for periods of eligible creditable service as a
22    covered employee: if retirement occurs on or after January
23    1, 2001, 2.5% of final average compensation for each year
24    of creditable service; if retirement occurs before January
25    1, 2001, 1.67% of final average compensation for each of

 

 

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1    the first 10 years of such service, 1.90% for each of the
2    next 10 years of such service, 2.10% for each year of such
3    service in excess of 20 but not exceeding 30, and 2.30% for
4    each year in excess of 30.
5    Such annuity shall be subject to a maximum of 75% of final
6average compensation if retirement occurs before January 1,
72001 or to a maximum of 80% of final average compensation if
8retirement occurs on or after January 1, 2001.
9    These rates shall not be applicable to any service
10performed by a member as a covered employee which is not
11eligible creditable service. Service as a covered employee
12which is not eligible creditable service shall be subject to
13the rates and provisions of Section 14-108.
14    (a-5) Notwithstanding subsection (a) of this Section, for a
15Tier I member who begins receiving a retirement annuity under
16this Section on or after July 1, 2013:
17        (1) If the Tier I member is at least 45 years old on
18    the effective date of this amendatory Act of the 98th
19    General Assembly, then the references to age 50 and 55 in
20    subsection (a) of this Section remain unchanged.
21        (2) If the Tier I member is at least 40 but less than
22    45 years old on the effective date of this amendatory Act
23    of the 98th General Assembly, then the references to age 50
24    and 55 in subsection (a) of this Section are increased by
25    one year.
26        (3) If the Tier I member is at least 35 but less than

 

 

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1    40 years old on the effective date of this amendatory Act
2    of the 98th General Assembly, then the references to age 50
3    and 55 in subsection (a) of this Section are increased by 3
4    years.
5        (4) If the Tier I member is less than 35 years old on
6    the effective date of this amendatory Act of the 98th
7    General Assembly, then the references to age 50 and 55 in
8    subsection (a) of this Section are increased by 5 years.
9    Notwithstanding Section 1-103.1, this subsection (a-5)
10applies without regard to whether or not the Tier I member is
11in active service under this Article on or after the effective
12date of this amendatory Act of the 98th General Assembly.
13    (b) For the purpose of this Section, "eligible creditable
14service" means creditable service resulting from service in one
15or more of the following positions:
16        (1) State policeman;
17        (2) fire fighter in the fire protection service of a
18    department;
19        (3) air pilot;
20        (4) special agent;
21        (5) investigator for the Secretary of State;
22        (6) conservation police officer;
23        (7) investigator for the Department of Revenue or the
24    Illinois Gaming Board;
25        (8) security employee of the Department of Human
26    Services;

 

 

09800SB0001ham001- 106 -LRB098 05457 EFG 45203 a

1        (9) Central Management Services security police
2    officer;
3        (10) security employee of the Department of
4    Corrections or the Department of Juvenile Justice;
5        (11) dangerous drugs investigator;
6        (12) investigator for the Department of State Police;
7        (13) investigator for the Office of the Attorney
8    General;
9        (14) controlled substance inspector;
10        (15) investigator for the Office of the State's
11    Attorneys Appellate Prosecutor;
12        (16) Commerce Commission police officer;
13        (17) arson investigator;
14        (18) State highway maintenance worker.
15    A person employed in one of the positions specified in this
16subsection is entitled to eligible creditable service for
17service credit earned under this Article while undergoing the
18basic police training course approved by the Illinois Law
19Enforcement Training Standards Board, if completion of that
20training is required of persons serving in that position. For
21the purposes of this Code, service during the required basic
22police training course shall be deemed performance of the
23duties of the specified position, even though the person is not
24a sworn peace officer at the time of the training.
25    (c) For the purposes of this Section:
26        (1) The term "state policeman" includes any title or

 

 

09800SB0001ham001- 107 -LRB098 05457 EFG 45203 a

1    position in the Department of State Police that is held by
2    an individual employed under the State Police Act.
3        (2) The term "fire fighter in the fire protection
4    service of a department" includes all officers in such fire
5    protection service including fire chiefs and assistant
6    fire chiefs.
7        (3) The term "air pilot" includes any employee whose
8    official job description on file in the Department of
9    Central Management Services, or in the department by which
10    he is employed if that department is not covered by the
11    Personnel Code, states that his principal duty is the
12    operation of aircraft, and who possesses a pilot's license;
13    however, the change in this definition made by this
14    amendatory Act of 1983 shall not operate to exclude any
15    noncovered employee who was an "air pilot" for the purposes
16    of this Section on January 1, 1984.
17        (4) The term "special agent" means any person who by
18    reason of employment by the Division of Narcotic Control,
19    the Bureau of Investigation or, after July 1, 1977, the
20    Division of Criminal Investigation, the Division of
21    Internal Investigation, the Division of Operations, or any
22    other Division or organizational entity in the Department
23    of State Police is vested by law with duties to maintain
24    public order, investigate violations of the criminal law of
25    this State, enforce the laws of this State, make arrests
26    and recover property. The term "special agent" includes any

 

 

09800SB0001ham001- 108 -LRB098 05457 EFG 45203 a

1    title or position in the Department of State Police that is
2    held by an individual employed under the State Police Act.
3        (5) The term "investigator for the Secretary of State"
4    means any person employed by the Office of the Secretary of
5    State and vested with such investigative duties as render
6    him ineligible for coverage under the Social Security Act
7    by reason of Sections 218(d)(5)(A), 218(d)(8)(D) and
8    218(l)(1) of that Act.
9        A person who became employed as an investigator for the
10    Secretary of State between January 1, 1967 and December 31,
11    1975, and who has served as such until attainment of age
12    60, either continuously or with a single break in service
13    of not more than 3 years duration, which break terminated
14    before January 1, 1976, shall be entitled to have his
15    retirement annuity calculated in accordance with
16    subsection (a), notwithstanding that he has less than 20
17    years of credit for such service.
18        (6) The term "Conservation Police Officer" means any
19    person employed by the Division of Law Enforcement of the
20    Department of Natural Resources and vested with such law
21    enforcement duties as render him ineligible for coverage
22    under the Social Security Act by reason of Sections
23    218(d)(5)(A), 218(d)(8)(D), and 218(l)(1) of that Act. The
24    term "Conservation Police Officer" includes the positions
25    of Chief Conservation Police Administrator and Assistant
26    Conservation Police Administrator.

 

 

09800SB0001ham001- 109 -LRB098 05457 EFG 45203 a

1        (7) The term "investigator for the Department of
2    Revenue" means any person employed by the Department of
3    Revenue and vested with such investigative duties as render
4    him ineligible for coverage under the Social Security Act
5    by reason of Sections 218(d)(5)(A), 218(d)(8)(D) and
6    218(l)(1) of that Act.
7        The term "investigator for the Illinois Gaming Board"
8    means any person employed as such by the Illinois Gaming
9    Board and vested with such peace officer duties as render
10    the person ineligible for coverage under the Social
11    Security Act by reason of Sections 218(d)(5)(A),
12    218(d)(8)(D), and 218(l)(1) of that Act.
13        (8) The term "security employee of the Department of
14    Human Services" means any person employed by the Department
15    of Human Services who (i) is employed at the Chester Mental
16    Health Center and has daily contact with the residents
17    thereof, (ii) is employed within a security unit at a
18    facility operated by the Department and has daily contact
19    with the residents of the security unit, (iii) is employed
20    at a facility operated by the Department that includes a
21    security unit and is regularly scheduled to work at least
22    50% of his or her working hours within that security unit,
23    or (iv) is a mental health police officer. "Mental health
24    police officer" means any person employed by the Department
25    of Human Services in a position pertaining to the
26    Department's mental health and developmental disabilities

 

 

09800SB0001ham001- 110 -LRB098 05457 EFG 45203 a

1    functions who is vested with such law enforcement duties as
2    render the person ineligible for coverage under the Social
3    Security Act by reason of Sections 218(d)(5)(A),
4    218(d)(8)(D) and 218(l)(1) of that Act. "Security unit"
5    means that portion of a facility that is devoted to the
6    care, containment, and treatment of persons committed to
7    the Department of Human Services as sexually violent
8    persons, persons unfit to stand trial, or persons not
9    guilty by reason of insanity. With respect to past
10    employment, references to the Department of Human Services
11    include its predecessor, the Department of Mental Health
12    and Developmental Disabilities.
13        The changes made to this subdivision (c)(8) by Public
14    Act 92-14 apply to persons who retire on or after January
15    1, 2001, notwithstanding Section 1-103.1.
16        (9) "Central Management Services security police
17    officer" means any person employed by the Department of
18    Central Management Services who is vested with such law
19    enforcement duties as render him ineligible for coverage
20    under the Social Security Act by reason of Sections
21    218(d)(5)(A), 218(d)(8)(D) and 218(l)(1) of that Act.
22        (10) For a member who first became an employee under
23    this Article before July 1, 2005, the term "security
24    employee of the Department of Corrections or the Department
25    of Juvenile Justice" means any employee of the Department
26    of Corrections or the Department of Juvenile Justice or the

 

 

09800SB0001ham001- 111 -LRB098 05457 EFG 45203 a

1    former Department of Personnel, and any member or employee
2    of the Prisoner Review Board, who has daily contact with
3    inmates or youth by working within a correctional facility
4    or Juvenile facility operated by the Department of Juvenile
5    Justice or who is a parole officer or an employee who has
6    direct contact with committed persons in the performance of
7    his or her job duties. For a member who first becomes an
8    employee under this Article on or after July 1, 2005, the
9    term means an employee of the Department of Corrections or
10    the Department of Juvenile Justice who is any of the
11    following: (i) officially headquartered at a correctional
12    facility or Juvenile facility operated by the Department of
13    Juvenile Justice, (ii) a parole officer, (iii) a member of
14    the apprehension unit, (iv) a member of the intelligence
15    unit, (v) a member of the sort team, or (vi) an
16    investigator.
17        (11) The term "dangerous drugs investigator" means any
18    person who is employed as such by the Department of Human
19    Services.
20        (12) The term "investigator for the Department of State
21    Police" means a person employed by the Department of State
22    Police who is vested under Section 4 of the Narcotic
23    Control Division Abolition Act with such law enforcement
24    powers as render him ineligible for coverage under the
25    Social Security Act by reason of Sections 218(d)(5)(A),
26    218(d)(8)(D) and 218(l)(1) of that Act.

 

 

09800SB0001ham001- 112 -LRB098 05457 EFG 45203 a

1        (13) "Investigator for the Office of the Attorney
2    General" means any person who is employed as such by the
3    Office of the Attorney General and is vested with such
4    investigative duties as render him ineligible for coverage
5    under the Social Security Act by reason of Sections
6    218(d)(5)(A), 218(d)(8)(D) and 218(l)(1) of that Act. For
7    the period before January 1, 1989, the term includes all
8    persons who were employed as investigators by the Office of
9    the Attorney General, without regard to social security
10    status.
11        (14) "Controlled substance inspector" means any person
12    who is employed as such by the Department of Professional
13    Regulation and is vested with such law enforcement duties
14    as render him ineligible for coverage under the Social
15    Security Act by reason of Sections 218(d)(5)(A),
16    218(d)(8)(D) and 218(l)(1) of that Act. The term
17    "controlled substance inspector" includes the Program
18    Executive of Enforcement and the Assistant Program
19    Executive of Enforcement.
20        (15) The term "investigator for the Office of the
21    State's Attorneys Appellate Prosecutor" means a person
22    employed in that capacity on a full time basis under the
23    authority of Section 7.06 of the State's Attorneys
24    Appellate Prosecutor's Act.
25        (16) "Commerce Commission police officer" means any
26    person employed by the Illinois Commerce Commission who is

 

 

09800SB0001ham001- 113 -LRB098 05457 EFG 45203 a

1    vested with such law enforcement duties as render him
2    ineligible for coverage under the Social Security Act by
3    reason of Sections 218(d)(5)(A), 218(d)(8)(D), and
4    218(l)(1) of that Act.
5        (17) "Arson investigator" means any person who is
6    employed as such by the Office of the State Fire Marshal
7    and is vested with such law enforcement duties as render
8    the person ineligible for coverage under the Social
9    Security Act by reason of Sections 218(d)(5)(A),
10    218(d)(8)(D), and 218(l)(1) of that Act. A person who was
11    employed as an arson investigator on January 1, 1995 and is
12    no longer in service but not yet receiving a retirement
13    annuity may convert his or her creditable service for
14    employment as an arson investigator into eligible
15    creditable service by paying to the System the difference
16    between the employee contributions actually paid for that
17    service and the amounts that would have been contributed if
18    the applicant were contributing at the rate applicable to
19    persons with the same social security status earning
20    eligible creditable service on the date of application.
21        (18) The term "State highway maintenance worker" means
22    a person who is either of the following:
23            (i) A person employed on a full-time basis by the
24        Illinois Department of Transportation in the position
25        of highway maintainer, highway maintenance lead
26        worker, highway maintenance lead/lead worker, heavy

 

 

09800SB0001ham001- 114 -LRB098 05457 EFG 45203 a

1        construction equipment operator, power shovel
2        operator, or bridge mechanic; and whose principal
3        responsibility is to perform, on the roadway, the
4        actual maintenance necessary to keep the highways that
5        form a part of the State highway system in serviceable
6        condition for vehicular traffic.
7            (ii) A person employed on a full-time basis by the
8        Illinois State Toll Highway Authority in the position
9        of equipment operator/laborer H-4, equipment
10        operator/laborer H-6, welder H-4, welder H-6,
11        mechanical/electrical H-4, mechanical/electrical H-6,
12        water/sewer H-4, water/sewer H-6, sign maker/hanger
13        H-4, sign maker/hanger H-6, roadway lighting H-4,
14        roadway lighting H-6, structural H-4, structural H-6,
15        painter H-4, or painter H-6; and whose principal
16        responsibility is to perform, on the roadway, the
17        actual maintenance necessary to keep the Authority's
18        tollways in serviceable condition for vehicular
19        traffic.
20    (d) A security employee of the Department of Corrections or
21the Department of Juvenile Justice, and a security employee of
22the Department of Human Services who is not a mental health
23police officer, shall not be eligible for the alternative
24retirement annuity provided by this Section unless he or she
25meets the following minimum age and service requirements at the
26time of retirement:

 

 

09800SB0001ham001- 115 -LRB098 05457 EFG 45203 a

1        (i) 25 years of eligible creditable service and age 55;
2    or
3        (ii) beginning January 1, 1987, 25 years of eligible
4    creditable service and age 54, or 24 years of eligible
5    creditable service and age 55; or
6        (iii) beginning January 1, 1988, 25 years of eligible
7    creditable service and age 53, or 23 years of eligible
8    creditable service and age 55; or
9        (iv) beginning January 1, 1989, 25 years of eligible
10    creditable service and age 52, or 22 years of eligible
11    creditable service and age 55; or
12        (v) beginning January 1, 1990, 25 years of eligible
13    creditable service and age 51, or 21 years of eligible
14    creditable service and age 55; or
15        (vi) beginning January 1, 1991, 25 years of eligible
16    creditable service and age 50, or 20 years of eligible
17    creditable service and age 55.
18    For members to whom subsection (a-5) of this Section
19applies, the references to age 50 and 55 in item (vi) of this
20subsection are increased as provided in subsection (a-5).
21    Persons who have service credit under Article 16 of this
22Code for service as a security employee of the Department of
23Corrections or the Department of Juvenile Justice, or the
24Department of Human Services in a position requiring
25certification as a teacher may count such service toward
26establishing their eligibility under the service requirements

 

 

09800SB0001ham001- 116 -LRB098 05457 EFG 45203 a

1of this Section; but such service may be used only for
2establishing such eligibility, and not for the purpose of
3increasing or calculating any benefit.
4    (e) If a member enters military service while working in a
5position in which eligible creditable service may be earned,
6and returns to State service in the same or another such
7position, and fulfills in all other respects the conditions
8prescribed in this Article for credit for military service,
9such military service shall be credited as eligible creditable
10service for the purposes of the retirement annuity prescribed
11in this Section.
12    (f) For purposes of calculating retirement annuities under
13this Section, periods of service rendered after December 31,
141968 and before October 1, 1975 as a covered employee in the
15position of special agent, conservation police officer, mental
16health police officer, or investigator for the Secretary of
17State, shall be deemed to have been service as a noncovered
18employee, provided that the employee pays to the System prior
19to retirement an amount equal to (1) the difference between the
20employee contributions that would have been required for such
21service as a noncovered employee, and the amount of employee
22contributions actually paid, plus (2) if payment is made after
23July 31, 1987, regular interest on the amount specified in item
24(1) from the date of service to the date of payment.
25    For purposes of calculating retirement annuities under
26this Section, periods of service rendered after December 31,

 

 

09800SB0001ham001- 117 -LRB098 05457 EFG 45203 a

11968 and before January 1, 1982 as a covered employee in the
2position of investigator for the Department of Revenue shall be
3deemed to have been service as a noncovered employee, provided
4that the employee pays to the System prior to retirement an
5amount equal to (1) the difference between the employee
6contributions that would have been required for such service as
7a noncovered employee, and the amount of employee contributions
8actually paid, plus (2) if payment is made after January 1,
91990, regular interest on the amount specified in item (1) from
10the date of service to the date of payment.
11    (g) A State policeman may elect, not later than January 1,
121990, to establish eligible creditable service for up to 10
13years of his service as a policeman under Article 3, by filing
14a written election with the Board, accompanied by payment of an
15amount to be determined by the Board, equal to (i) the
16difference between the amount of employee and employer
17contributions transferred to the System under Section 3-110.5,
18and the amounts that would have been contributed had such
19contributions been made at the rates applicable to State
20policemen, plus (ii) interest thereon at the effective rate for
21each year, compounded annually, from the date of service to the
22date of payment.
23    Subject to the limitation in subsection (i), a State
24policeman may elect, not later than July 1, 1993, to establish
25eligible creditable service for up to 10 years of his service
26as a member of the County Police Department under Article 9, by

 

 

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1filing a written election with the Board, accompanied by
2payment of an amount to be determined by the Board, equal to
3(i) the difference between the amount of employee and employer
4contributions transferred to the System under Section 9-121.10
5and the amounts that would have been contributed had those
6contributions been made at the rates applicable to State
7policemen, plus (ii) interest thereon at the effective rate for
8each year, compounded annually, from the date of service to the
9date of payment.
10    (h) Subject to the limitation in subsection (i), a State
11policeman or investigator for the Secretary of State may elect
12to establish eligible creditable service for up to 12 years of
13his service as a policeman under Article 5, by filing a written
14election with the Board on or before January 31, 1992, and
15paying to the System by January 31, 1994 an amount to be
16determined by the Board, equal to (i) the difference between
17the amount of employee and employer contributions transferred
18to the System under Section 5-236, and the amounts that would
19have been contributed had such contributions been made at the
20rates applicable to State policemen, plus (ii) interest thereon
21at the effective rate for each year, compounded annually, from
22the date of service to the date of payment.
23    Subject to the limitation in subsection (i), a State
24policeman, conservation police officer, or investigator for
25the Secretary of State may elect to establish eligible
26creditable service for up to 10 years of service as a sheriff's

 

 

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1law enforcement employee under Article 7, by filing a written
2election with the Board on or before January 31, 1993, and
3paying to the System by January 31, 1994 an amount to be
4determined by the Board, equal to (i) the difference between
5the amount of employee and employer contributions transferred
6to the System under Section 7-139.7, and the amounts that would
7have been contributed had such contributions been made at the
8rates applicable to State policemen, plus (ii) interest thereon
9at the effective rate for each year, compounded annually, from
10the date of service to the date of payment.
11    Subject to the limitation in subsection (i), a State
12policeman, conservation police officer, or investigator for
13the Secretary of State may elect to establish eligible
14creditable service for up to 5 years of service as a police
15officer under Article 3, a policeman under Article 5, a
16sheriff's law enforcement employee under Article 7, a member of
17the county police department under Article 9, or a police
18officer under Article 15 by filing a written election with the
19Board and paying to the System an amount to be determined by
20the Board, equal to (i) the difference between the amount of
21employee and employer contributions transferred to the System
22under Section 3-110.6, 5-236, 7-139.8, 9-121.10, or 15-134.4
23and the amounts that would have been contributed had such
24contributions been made at the rates applicable to State
25policemen, plus (ii) interest thereon at the effective rate for
26each year, compounded annually, from the date of service to the

 

 

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1date of payment.
2    Subject to the limitation in subsection (i), an
3investigator for the Office of the Attorney General, or an
4investigator for the Department of Revenue, may elect to
5establish eligible creditable service for up to 5 years of
6service as a police officer under Article 3, a policeman under
7Article 5, a sheriff's law enforcement employee under Article
87, or a member of the county police department under Article 9
9by filing a written election with the Board within 6 months
10after August 25, 2009 (the effective date of Public Act 96-745)
11and paying to the System an amount to be determined by the
12Board, equal to (i) the difference between the amount of
13employee and employer contributions transferred to the System
14under Section 3-110.6, 5-236, 7-139.8, or 9-121.10 and the
15amounts that would have been contributed had such contributions
16been made at the rates applicable to State policemen, plus (ii)
17interest thereon at the actuarially assumed rate for each year,
18compounded annually, from the date of service to the date of
19payment.
20    Subject to the limitation in subsection (i), a State
21policeman, conservation police officer, investigator for the
22Office of the Attorney General, an investigator for the
23Department of Revenue, or investigator for the Secretary of
24State may elect to establish eligible creditable service for up
25to 5 years of service as a person employed by a participating
26municipality to perform police duties, or law enforcement

 

 

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1officer employed on a full-time basis by a forest preserve
2district under Article 7, a county corrections officer, or a
3court services officer under Article 9, by filing a written
4election with the Board within 6 months after August 25, 2009
5(the effective date of Public Act 96-745) and paying to the
6System an amount to be determined by the Board, equal to (i)
7the difference between the amount of employee and employer
8contributions transferred to the System under Sections 7-139.8
9and 9-121.10 and the amounts that would have been contributed
10had such contributions been made at the rates applicable to
11State policemen, plus (ii) interest thereon at the actuarially
12assumed rate for each year, compounded annually, from the date
13of service to the date of payment.
14    (i) The total amount of eligible creditable service
15established by any person under subsections (g), (h), (j), (k),
16and (l) of this Section shall not exceed 12 years.
17    (j) Subject to the limitation in subsection (i), an
18investigator for the Office of the State's Attorneys Appellate
19Prosecutor or a controlled substance inspector may elect to
20establish eligible creditable service for up to 10 years of his
21service as a policeman under Article 3 or a sheriff's law
22enforcement employee under Article 7, by filing a written
23election with the Board, accompanied by payment of an amount to
24be determined by the Board, equal to (1) the difference between
25the amount of employee and employer contributions transferred
26to the System under Section 3-110.6 or 7-139.8, and the amounts

 

 

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1that would have been contributed had such contributions been
2made at the rates applicable to State policemen, plus (2)
3interest thereon at the effective rate for each year,
4compounded annually, from the date of service to the date of
5payment.
6    (k) Subject to the limitation in subsection (i) of this
7Section, an alternative formula employee may elect to establish
8eligible creditable service for periods spent as a full-time
9law enforcement officer or full-time corrections officer
10employed by the federal government or by a state or local
11government located outside of Illinois, for which credit is not
12held in any other public employee pension fund or retirement
13system. To obtain this credit, the applicant must file a
14written application with the Board by March 31, 1998,
15accompanied by evidence of eligibility acceptable to the Board
16and payment of an amount to be determined by the Board, equal
17to (1) employee contributions for the credit being established,
18based upon the applicant's salary on the first day as an
19alternative formula employee after the employment for which
20credit is being established and the rates then applicable to
21alternative formula employees, plus (2) an amount determined by
22the Board to be the employer's normal cost of the benefits
23accrued for the credit being established, plus (3) regular
24interest on the amounts in items (1) and (2) from the first day
25as an alternative formula employee after the employment for
26which credit is being established to the date of payment.

 

 

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1    (l) Subject to the limitation in subsection (i), a security
2employee of the Department of Corrections may elect, not later
3than July 1, 1998, to establish eligible creditable service for
4up to 10 years of his or her service as a policeman under
5Article 3, by filing a written election with the Board,
6accompanied by payment of an amount to be determined by the
7Board, equal to (i) the difference between the amount of
8employee and employer contributions transferred to the System
9under Section 3-110.5, and the amounts that would have been
10contributed had such contributions been made at the rates
11applicable to security employees of the Department of
12Corrections, plus (ii) interest thereon at the effective rate
13for each year, compounded annually, from the date of service to
14the date of payment.
15    (m) The amendatory changes to this Section made by this
16amendatory Act of the 94th General Assembly apply only to: (1)
17security employees of the Department of Juvenile Justice
18employed by the Department of Corrections before the effective
19date of this amendatory Act of the 94th General Assembly and
20transferred to the Department of Juvenile Justice by this
21amendatory Act of the 94th General Assembly; and (2) persons
22employed by the Department of Juvenile Justice on or after the
23effective date of this amendatory Act of the 94th General
24Assembly who are required by subsection (b) of Section 3-2.5-15
25of the Unified Code of Corrections to have a bachelor's or
26advanced degree from an accredited college or university with a

 

 

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1specialization in criminal justice, education, psychology,
2social work, or a closely related social science or, in the
3case of persons who provide vocational training, who are
4required to have adequate knowledge in the skill for which they
5are providing the vocational training.
6    (n) A person employed in a position under subsection (b) of
7this Section who has purchased service credit under subsection
8(j) of Section 14-104 or subsection (b) of Section 14-105 in
9any other capacity under this Article may convert up to 5 years
10of that service credit into service credit covered under this
11Section by paying to the Fund an amount equal to (1) the
12additional employee contribution required under Section
1314-133, plus (2) the additional employer contribution required
14under Section 14-131, plus (3) interest on items (1) and (2) at
15the actuarially assumed rate from the date of the service to
16the date of payment.
17(Source: P.A. 95-530, eff. 8-28-07; 95-1036, eff. 2-17-09;
1896-37, eff. 7-13-09; 96-745, eff. 8-25-09; 96-1000, eff.
197-2-10.)
 
20    (40 ILCS 5/14-114)  (from Ch. 108 1/2, par. 14-114)
21    Sec. 14-114. Automatic increase in retirement annuity.
22    (a) Except as provided in subsections (a-1) and (a-2), any
23Any person receiving a retirement annuity under this Article
24who retires having attained age 60, or who retires before age
2560 having at least 35 years of creditable service, or who

 

 

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1retires on or after January 1, 2001 at an age which, when added
2to the number of years of his or her creditable service, equals
3at least 85, shall, on January 1 next following the first full
4year of retirement, have the amount of the then fixed and
5payable monthly retirement annuity increased 3%. Any person
6receiving a retirement annuity under this Article who retires
7before attainment of age 60 and with less than (i) 35 years of
8creditable service if retirement is before January 1, 2001, or
9(ii) the number of years of creditable service which, when
10added to the member's age, would equal 85, if retirement is on
11or after January 1, 2001, shall have the amount of the fixed
12and payable retirement annuity increased by 3% on the January 1
13occurring on or next following (1) attainment of age 60, or (2)
14the first anniversary of retirement, whichever occurs later.
15However, for persons who receive the alternative retirement
16annuity under Section 14-110, references in this subsection (a)
17to attainment of age 60 shall be deemed to refer to attainment
18of age 55. For a person receiving early retirement incentives
19under Section 14-108.3 whose retirement annuity began after
20January 1, 1992 pursuant to an extension granted under
21subsection (e) of that Section, the first anniversary of
22retirement shall be deemed to be January 1, 1993. For a person
23who retires on or after June 28, 2001 and on or before October
241, 2001, and whose retirement annuity is calculated, in whole
25or in part, under Section 14-110 or subsection (g) or (h) of
26Section 14-108, the first anniversary of retirement shall be

 

 

09800SB0001ham001- 126 -LRB098 05457 EFG 45203 a

1deemed to be January 1, 2002.
2    On each January 1 following the date of the initial
3increase under this subsection, the employee's monthly
4retirement annuity shall be increased by an additional 3%.
5    Beginning January 1, 1990 and except as provided in
6subsections (a-1) and (a-2), all automatic annual increases
7payable under this Section shall be calculated as a percentage
8of the total annuity payable at the time of the increase,
9including previous increases granted under this Article.
10    (a-1) Notwithstanding any other provision of this Article,
11for a Tier I retiree, the amount of each automatic annual
12increase in retirement annuity occurring on or after the
13effective date of this amendatory Act of the 98th General
14Assembly shall be 3% of the lesser of (1) the total annuity
15payable at the time of the increase, including previous
16increases granted or (2) $800 ($1,000 if the annuity is based
17primarily upon service as a noncovered employee) multiplied by
18the number of years of creditable service upon which the
19annuity is based.
20    (a-2) Notwithstanding any other provision of this Article,
21for a Tier I retiree, the monthly retirement annuity shall
22first be subject to annual increases on the January 1 occurring
23on or next after the attainment of age 67 or the January 1
24occurring on or next after the fifth anniversary of the annuity
25start date, whichever occurs earlier. If on the effective date
26of this amendatory Act of the 98th General Assembly a Tier I

 

 

09800SB0001ham001- 127 -LRB098 05457 EFG 45203 a

1retiree has already received an annual increase under this
2Section but does not yet meet the new eligibility requirements
3of this subsection, the annual increases already received shall
4continue in force, but no additional annual increase shall be
5granted until the Tier I retiree meets the new eligibility
6requirements.
7    (a-3) Notwithstanding Section 1-103.1, subsections (a-1)
8and (a-2) apply without regard to whether or not the Tier I
9retiree is in active service under this Article on or after the
10effective date of this amendatory Act of the 98th General
11Assembly.
12    (b) The provisions of subsection (a) of this Section shall
13be applicable to an employee only if the employee makes the
14additional contributions required after December 31, 1969 for
15the purpose of the automatic increases for not less than the
16equivalent of one full year. If an employee becomes an
17annuitant before his additional contributions equal one full
18year's contributions based on his salary at the date of
19retirement, the employee may pay the necessary balance of the
20contributions to the system, without interest, and be eligible
21for the increasing annuity authorized by this Section.
22    (c) The provisions of subsection (a) of this Section shall
23not be applicable to any annuitant who is on retirement on
24December 31, 1969, and thereafter returns to State service,
25unless the member has established at least one year of
26additional creditable service following reentry into service.

 

 

09800SB0001ham001- 128 -LRB098 05457 EFG 45203 a

1    (d) In addition to other increases which may be provided by
2this Section, on January 1, 1981 any annuitant who was
3receiving a retirement annuity on or before January 1, 1971
4shall have his retirement annuity then being paid increased $1
5per month for each year of creditable service. On January 1,
61982, any annuitant who began receiving a retirement annuity on
7or before January 1, 1977, shall have his retirement annuity
8then being paid increased $1 per month for each year of
9creditable service.
10    On January 1, 1987, any annuitant who began receiving a
11retirement annuity on or before January 1, 1977, shall have the
12monthly retirement annuity increased by an amount equal to 8
13per year of creditable service times the number of years that
14have elapsed since the annuity began.
15    (e) Every person who receives the alternative retirement
16annuity under Section 14-110 and who is eligible to receive the
173% increase under subsection (a) on January 1, 1986, shall also
18receive on that date a one-time increase in retirement annuity
19equal to the difference between (1) his actual retirement
20annuity on that date, including any increases received under
21subsection (a), and (2) the amount of retirement annuity he
22would have received on that date if the amendments to
23subsection (a) made by Public Act 84-162 had been in effect
24since the date of his retirement.
25(Source: P.A. 91-927, eff. 12-14-00; 92-14, eff. 6-28-01;
2692-651, eff. 7-11-02.)
 

 

 

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1    (40 ILCS 5/14-131)
2    Sec. 14-131. Contributions by State.
3    (a) The State shall make contributions to the System by
4appropriations of amounts which, together with other employer
5contributions from trust, federal, and other funds, employee
6contributions, investment income, and other income, will be
7sufficient to meet the cost of maintaining and administering
8the System on a 100% 90% funded basis in accordance with
9actuarial recommendations by the end of State fiscal year 2044.
10    For the purposes of this Section and Section 14-135.08,
11references to State contributions refer only to employer
12contributions and do not include employee contributions that
13are picked up or otherwise paid by the State or a department on
14behalf of the employee.
15    (b) The Board shall determine the total amount of State
16contributions required for each fiscal year on the basis of the
17actuarial tables and other assumptions adopted by the Board,
18using the formula in subsection (e).
19    The Board shall also determine a State contribution rate
20for each fiscal year, expressed as a percentage of payroll,
21based on the total required State contribution for that fiscal
22year (less the amount received by the System from
23appropriations under Section 8.12 of the State Finance Act and
24Section 1 of the State Pension Funds Continuing Appropriation
25Act, if any, for the fiscal year ending on the June 30

 

 

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1immediately preceding the applicable November 15 certification
2deadline), the estimated payroll (including all forms of
3compensation) for personal services rendered by eligible
4employees, and the recommendations of the actuary.
5    For the purposes of this Section and Section 14.1 of the
6State Finance Act, the term "eligible employees" includes
7employees who participate in the System, persons who may elect
8to participate in the System but have not so elected, persons
9who are serving a qualifying period that is required for
10participation, and annuitants employed by a department as
11described in subdivision (a)(1) or (a)(2) of Section 14-111.
12    (c) Contributions shall be made by the several departments
13for each pay period by warrants drawn by the State Comptroller
14against their respective funds or appropriations based upon
15vouchers stating the amount to be so contributed. These amounts
16shall be based on the full rate certified by the Board under
17Section 14-135.08 for that fiscal year. From the effective date
18of this amendatory Act of the 93rd General Assembly through the
19payment of the final payroll from fiscal year 2004
20appropriations, the several departments shall not make
21contributions for the remainder of fiscal year 2004 but shall
22instead make payments as required under subsection (a-1) of
23Section 14.1 of the State Finance Act. The several departments
24shall resume those contributions at the commencement of fiscal
25year 2005.
26    (c-1) Notwithstanding subsection (c) of this Section, for

 

 

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1fiscal years 2010, 2012, and 2013 only, contributions by the
2several departments are not required to be made for General
3Revenue Funds payrolls processed by the Comptroller. Payrolls
4paid by the several departments from all other State funds must
5continue to be processed pursuant to subsection (c) of this
6Section.
7    (c-2) For State fiscal years 2010, 2012, and 2013 only, on
8or as soon as possible after the 15th day of each month, the
9Board shall submit vouchers for payment of State contributions
10to the System, in a total monthly amount of one-twelfth of the
11fiscal year General Revenue Fund contribution as certified by
12the System pursuant to Section 14-135.08 of the Illinois
13Pension Code.
14    (d) If an employee is paid from trust funds or federal
15funds, the department or other employer shall pay employer
16contributions from those funds to the System at the certified
17rate, unless the terms of the trust or the federal-State
18agreement preclude the use of the funds for that purpose, in
19which case the required employer contributions shall be paid by
20the State. From the effective date of this amendatory Act of
21the 93rd General Assembly through the payment of the final
22payroll from fiscal year 2004 appropriations, the department or
23other employer shall not pay contributions for the remainder of
24fiscal year 2004 but shall instead make payments as required
25under subsection (a-1) of Section 14.1 of the State Finance
26Act. The department or other employer shall resume payment of

 

 

09800SB0001ham001- 132 -LRB098 05457 EFG 45203 a

1contributions at the commencement of fiscal year 2005.
2    (e) For State fiscal years 2015 through 2044, the minimum
3contribution to the System to be made by the State for each
4fiscal year shall be an amount determined by the System to be
5equal to the sum of (1) the State's portion of the projected
6normal cost for that fiscal year, plus (2) an amount sufficient
7to bring the total assets of the System up to 100% of the total
8actuarial liabilities of the System by the end of State fiscal
9year 2044. In making these determinations, the required State
10contribution shall be calculated each year as a level
11percentage of payroll over the years remaining to and including
12fiscal year 2044 and shall be determined under the entry age
13normal actuarial cost method.
14    For State fiscal years 2012 through 2014 2045, the minimum
15contribution to the System to be made by the State for each
16fiscal year shall be an amount determined by the System to be
17sufficient to bring the total assets of the System up to 90% of
18the total actuarial liabilities of the System by the end of
19State fiscal year 2045. In making these determinations, the
20required State contribution shall be calculated each year as a
21level percentage of payroll over the years remaining to and
22including fiscal year 2045 and shall be determined under the
23projected unit credit actuarial cost method.
24    For State fiscal years 1996 through 2005, the State
25contribution to the System, as a percentage of the applicable
26employee payroll, shall be increased in equal annual increments

 

 

09800SB0001ham001- 133 -LRB098 05457 EFG 45203 a

1so that by State fiscal year 2011, the State is contributing at
2the rate required under this Section; except that (i) for State
3fiscal year 1998, for all purposes of this Code and any other
4law of this State, the certified percentage of the applicable
5employee payroll shall be 5.052% for employees earning eligible
6creditable service under Section 14-110 and 6.500% for all
7other employees, notwithstanding any contrary certification
8made under Section 14-135.08 before the effective date of this
9amendatory Act of 1997, and (ii) in the following specified
10State fiscal years, the State contribution to the System shall
11not be less than the following indicated percentages of the
12applicable employee payroll, even if the indicated percentage
13will produce a State contribution in excess of the amount
14otherwise required under this subsection and subsection (a):
159.8% in FY 1999; 10.0% in FY 2000; 10.2% in FY 2001; 10.4% in FY
162002; 10.6% in FY 2003; and 10.8% in FY 2004.
17    Notwithstanding any other provision of this Article, the
18total required State contribution to the System for State
19fiscal year 2006 is $203,783,900.
20    Notwithstanding any other provision of this Article, the
21total required State contribution to the System for State
22fiscal year 2007 is $344,164,400.
23    For each of State fiscal years 2008 through 2009, the State
24contribution to the System, as a percentage of the applicable
25employee payroll, shall be increased in equal annual increments
26from the required State contribution for State fiscal year

 

 

09800SB0001ham001- 134 -LRB098 05457 EFG 45203 a

12007, so that by State fiscal year 2011, the State is
2contributing at the rate otherwise required under this Section.
3    Notwithstanding any other provision of this Article, the
4total required State General Revenue Fund contribution for
5State fiscal year 2010 is $723,703,100 and shall be made from
6the proceeds of bonds sold in fiscal year 2010 pursuant to
7Section 7.2 of the General Obligation Bond Act, less (i) the
8pro rata share of bond sale expenses determined by the System's
9share of total bond proceeds, (ii) any amounts received from
10the General Revenue Fund in fiscal year 2010, and (iii) any
11reduction in bond proceeds due to the issuance of discounted
12bonds, if applicable.
13    Notwithstanding any other provision of this Article, the
14total required State General Revenue Fund contribution for
15State fiscal year 2011 is the amount recertified by the System
16on or before April 1, 2011 pursuant to Section 14-135.08 and
17shall be made from the proceeds of bonds sold in fiscal year
182011 pursuant to Section 7.2 of the General Obligation Bond
19Act, less (i) the pro rata share of bond sale expenses
20determined by the System's share of total bond proceeds, (ii)
21any amounts received from the General Revenue Fund in fiscal
22year 2011, and (iii) any reduction in bond proceeds due to the
23issuance of discounted bonds, if applicable.
24    Beginning in State fiscal year 2045, the minimum State
25contribution for each fiscal year shall be the amount needed to
26maintain the total assets of the System at 100% of the total

 

 

09800SB0001ham001- 135 -LRB098 05457 EFG 45203 a

1actuarial liabilities of the System.
2    Beginning in State fiscal year 2046, the minimum State
3contribution for each fiscal year shall be the amount needed to
4maintain the total assets of the System at 90% of the total
5actuarial liabilities of the System.
6    Amounts received by the System pursuant to Section 25 of
7the Budget Stabilization Act or Section 8.12 of the State
8Finance Act in any fiscal year do not reduce and do not
9constitute payment of any portion of the minimum State
10contribution required under this Article in that fiscal year.
11Such amounts shall not reduce, and shall not be included in the
12calculation of, the required State contributions under this
13Article in any future year until the System has reached a
14funding ratio of at least 100% 90%. A reference in this Article
15to the "required State contribution" or any substantially
16similar term does not include or apply to any amounts payable
17to the System under Section 25 of the Budget Stabilization Act.
18    Notwithstanding any other provision of this Section, the
19required State contribution for State fiscal year 2005 and for
20fiscal year 2008 and each fiscal year thereafter through State
21fiscal year 2014, as calculated under this Section and
22certified under Section 14-135.08, shall not exceed an amount
23equal to (i) the amount of the required State contribution that
24would have been calculated under this Section for that fiscal
25year if the System had not received any payments under
26subsection (d) of Section 7.2 of the General Obligation Bond

 

 

09800SB0001ham001- 136 -LRB098 05457 EFG 45203 a

1Act, minus (ii) the portion of the State's total debt service
2payments for that fiscal year on the bonds issued in fiscal
3year 2003 for the purposes of that Section 7.2, as determined
4and certified by the Comptroller, that is the same as the
5System's portion of the total moneys distributed under
6subsection (d) of Section 7.2 of the General Obligation Bond
7Act. In determining this maximum for State fiscal years 2008
8through 2010, however, the amount referred to in item (i) shall
9be increased, as a percentage of the applicable employee
10payroll, in equal increments calculated from the sum of the
11required State contribution for State fiscal year 2007 plus the
12applicable portion of the State's total debt service payments
13for fiscal year 2007 on the bonds issued in fiscal year 2003
14for the purposes of Section 7.2 of the General Obligation Bond
15Act, so that, by State fiscal year 2011, the State is
16contributing at the rate otherwise required under this Section.
17    (f) After the submission of all payments for eligible
18employees from personal services line items in fiscal year 2004
19have been made, the Comptroller shall provide to the System a
20certification of the sum of all fiscal year 2004 expenditures
21for personal services that would have been covered by payments
22to the System under this Section if the provisions of this
23amendatory Act of the 93rd General Assembly had not been
24enacted. Upon receipt of the certification, the System shall
25determine the amount due to the System based on the full rate
26certified by the Board under Section 14-135.08 for fiscal year

 

 

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12004 in order to meet the State's obligation under this
2Section. The System shall compare this amount due to the amount
3received by the System in fiscal year 2004 through payments
4under this Section and under Section 6z-61 of the State Finance
5Act. If the amount due is more than the amount received, the
6difference shall be termed the "Fiscal Year 2004 Shortfall" for
7purposes of this Section, and the Fiscal Year 2004 Shortfall
8shall be satisfied under Section 1.2 of the State Pension Funds
9Continuing Appropriation Act. If the amount due is less than
10the amount received, the difference shall be termed the "Fiscal
11Year 2004 Overpayment" for purposes of this Section, and the
12Fiscal Year 2004 Overpayment shall be repaid by the System to
13the Pension Contribution Fund as soon as practicable after the
14certification.
15    (g) For purposes of determining the required State
16contribution to the System, the value of the System's assets
17shall be equal to the actuarial value of the System's assets,
18which shall be calculated as follows:
19    As of June 30, 2008, the actuarial value of the System's
20assets shall be equal to the market value of the assets as of
21that date. In determining the actuarial value of the System's
22assets for fiscal years after June 30, 2008, any actuarial
23gains or losses from investment return incurred in a fiscal
24year shall be recognized in equal annual amounts over the
255-year period following that fiscal year.
26    (h) For purposes of determining the required State

 

 

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1contribution to the System for a particular year, the actuarial
2value of assets shall be assumed to earn a rate of return equal
3to the System's actuarially assumed rate of return.
4    (i) After the submission of all payments for eligible
5employees from personal services line items paid from the
6General Revenue Fund in fiscal year 2010 have been made, the
7Comptroller shall provide to the System a certification of the
8sum of all fiscal year 2010 expenditures for personal services
9that would have been covered by payments to the System under
10this Section if the provisions of this amendatory Act of the
1196th General Assembly had not been enacted. Upon receipt of the
12certification, the System shall determine the amount due to the
13System based on the full rate certified by the Board under
14Section 14-135.08 for fiscal year 2010 in order to meet the
15State's obligation under this Section. The System shall compare
16this amount due to the amount received by the System in fiscal
17year 2010 through payments under this Section. If the amount
18due is more than the amount received, the difference shall be
19termed the "Fiscal Year 2010 Shortfall" for purposes of this
20Section, and the Fiscal Year 2010 Shortfall shall be satisfied
21under Section 1.2 of the State Pension Funds Continuing
22Appropriation Act. If the amount due is less than the amount
23received, the difference shall be termed the "Fiscal Year 2010
24Overpayment" for purposes of this Section, and the Fiscal Year
252010 Overpayment shall be repaid by the System to the General
26Revenue Fund as soon as practicable after the certification.

 

 

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1    (j) After the submission of all payments for eligible
2employees from personal services line items paid from the
3General Revenue Fund in fiscal year 2011 have been made, the
4Comptroller shall provide to the System a certification of the
5sum of all fiscal year 2011 expenditures for personal services
6that would have been covered by payments to the System under
7this Section if the provisions of this amendatory Act of the
896th General Assembly had not been enacted. Upon receipt of the
9certification, the System shall determine the amount due to the
10System based on the full rate certified by the Board under
11Section 14-135.08 for fiscal year 2011 in order to meet the
12State's obligation under this Section. The System shall compare
13this amount due to the amount received by the System in fiscal
14year 2011 through payments under this Section. If the amount
15due is more than the amount received, the difference shall be
16termed the "Fiscal Year 2011 Shortfall" for purposes of this
17Section, and the Fiscal Year 2011 Shortfall shall be satisfied
18under Section 1.2 of the State Pension Funds Continuing
19Appropriation Act. If the amount due is less than the amount
20received, the difference shall be termed the "Fiscal Year 2011
21Overpayment" for purposes of this Section, and the Fiscal Year
222011 Overpayment shall be repaid by the System to the General
23Revenue Fund as soon as practicable after the certification.
24    (k) For fiscal years 2012 and 2013 only, after the
25submission of all payments for eligible employees from personal
26services line items paid from the General Revenue Fund in the

 

 

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1fiscal year have been made, the Comptroller shall provide to
2the System a certification of the sum of all expenditures in
3the fiscal year for personal services. Upon receipt of the
4certification, the System shall determine the amount due to the
5System based on the full rate certified by the Board under
6Section 14-135.08 for the fiscal year in order to meet the
7State's obligation under this Section. The System shall compare
8this amount due to the amount received by the System for the
9fiscal year. If the amount due is more than the amount
10received, the difference shall be termed the "Prior Fiscal Year
11Shortfall" for purposes of this Section, and the Prior Fiscal
12Year Shortfall shall be satisfied under Section 1.2 of the
13State Pension Funds Continuing Appropriation Act. If the amount
14due is less than the amount received, the difference shall be
15termed the "Prior Fiscal Year Overpayment" for purposes of this
16Section, and the Prior Fiscal Year Overpayment shall be repaid
17by the System to the General Revenue Fund as soon as
18practicable after the certification.
19(Source: P.A. 96-43, eff. 7-15-09; 96-45, eff. 7-15-09;
2096-1000, eff. 7-2-10; 96-1497, eff. 1-14-11; 96-1511, eff.
211-27-11; 96-1554, eff. 3-18-11; 97-72, eff. 7-1-11; 97-732,
22eff. 6-30-12.)
 
23    (40 ILCS 5/14-132)  (from Ch. 108 1/2, par. 14-132)
24    Sec. 14-132. Obligations of State; funding guarantee.
25    (a) The payment of the required department contributions,

 

 

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1all allowances, annuities, benefits granted under this
2Article, and all expenses of administration of the system are
3obligations of the State of Illinois to the extent specified in
4this Article.
5    (b) All income of the system shall be credited to a
6separate account for this system in the State treasury and
7shall be used to pay allowances, annuities, benefits and
8administration expense.
9    (c) Beginning July 1, 2013, the State shall be
10contractually obligated to contribute to the System in each
11State fiscal year an amount not less than the sum of (i) the
12State's normal cost for the year and (ii) the portion of the
13unfunded accrued liability assigned to that year by law.
14Notwithstanding any other provision of law, if the State fails
15to pay an amount guaranteed under this subsection, it shall be
16the mandatory fiduciary obligation of the Board to seek payment
17of the guaranteed amount in compliance with the provisions of
18this Section and, if the amount remains unpaid, to bring a
19mandamus action in the Supreme Court of Illinois to compel the
20State to make the required payment.
21    If the System or a department submits a voucher for
22contributions required under Section 14-131 and the State fails
23to pay that voucher within 90 days of its receipt, the Board
24shall submit a written request to the Comptroller seeking
25payment. A copy of the request shall be filed with the
26Secretary of State, and the Secretary of State shall provide a

 

 

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1copy to the Governor and General Assembly. No earlier than the
216th day after the System files the request with the
3Comptroller and Secretary of State, if the amount remains
4unpaid the Board shall commence a mandamus action in the
5Supreme Court of Illinois to compel the Comptroller to satisfy
6the voucher.
7    This subsection (c) constitutes an express waiver of the
8State's sovereign immunity solely to the extent that it permits
9the Board to commence a mandamus action in the Supreme Court of
10Illinois to compel the Comptroller to pay a voucher for the
11contributions required under Section 14-131.
12    (d) Beginning in State fiscal year 2020, the State shall be
13contractually obligated to make the transfers set forth in
14subsections (c-10) and (c-15) of Section 20 of the Budget
15Stabilization Act and to pay to the System its proportionate
16share of the transferred amounts in accordance with Section 25
17of the Budget Stabilization Act. Notwithstanding any other
18provision of law, if the State fails to transfer an amount
19guaranteed under this subsection or to pay to the System its
20proportionate share of the transferred amount in accordance
21with Section 25 of the Budget Stabilization Act, it shall be
22the mandatory fiduciary obligation of the Board to seek
23transfer or payment of the guaranteed amount in compliance with
24the provisions of this Section and, if the required amount
25remains untransferred or the required payment remains unpaid,
26to bring a mandamus action in the Supreme Court of Illinois to

 

 

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1compel the State to make the required transfer or payment or
2both, as the case may be.
3    If the State fails to make a transfer required under
4subsections (c-10) and (c-15) of Section 20 of the Budget
5Stabilization Act or a payment to the System required under
6Section 25 of that Act, the Board shall submit a written
7request to the Comptroller seeking payment. A copy of the
8request shall be filed with the Secretary of State, and the
9Secretary of State shall provide a copy to the Governor and
10General Assembly. No earlier than the 16th day after the System
11files the request with the Comptroller and Secretary of State,
12if the required amount remains untransferred or the required
13payment remains unpaid, the Board shall commence a mandamus
14action in the Supreme Court of Illinois to compel the
15Comptroller to make the required transfer or payment or both,
16as the case may be.
17    This subsection (d) constitutes an express waiver of the
18State's sovereign immunity solely to the extent that it permits
19the Board to commence a mandamus action in the Supreme Court of
20Illinois to compel the Comptroller to make a transfer required
21under subsections (c-10) and (c-15) of Section 20 of the Budget
22Stabilization Act and to pay to the System its proportionate
23share of the transferred amount in accordance with Section 25
24of the Budget Stabilization Act.
25    The obligations created by this subsection (d) expire when
26all of the requirements of subsections (c-10) and (c-15) of

 

 

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1Section 20 of the Budget Stabilization Act and Section 25 of
2the Budget Stabilization Act have been met.
3    (e) Any payments and transfers required to be made by the
4State pursuant to subsection (c) or (d) are expressly
5subordinate to the payment of the principal, interest, and
6premium, if any, on any bonded debt obligation of the State or
7any other State-created entity, either currently outstanding
8or to be issued, for which the source of repayment or security
9thereon is derived directly or indirectly from tax revenues
10collected by the State or any other State-created entity.
11Payments on such bonded obligations includes any statutory fund
12transfers or other prefunding mechanisms or formulas set forth,
13now or hereafter, in State law or bond indentures, into debt
14service funds or accounts of the State related to such bond
15obligations, consistent with the payment schedules associated
16with such obligations.
17    (f) By the enactment of this amendatory Act of the 98th
18General Assembly, the State of Illinois pledges to and agrees
19with the Board and members of the System that the State will
20make the payments required under Section 14-131 of this Code,
21the transfers required under subsections (c-10) and (c-15) of
22Section 20 of the Budget Stabilization Act, and the payments to
23the System of its proportionate share of the transferred
24amounts in accordance with Section 25 of the Budget
25Stabilization Act. The State further pledges that the State
26will not limit or alter the rights and powers vested in the

 

 

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1Board so as to impair the terms of this Section or in any way
2impair the rights and remedies of the Board.
3(Source: P.A. 80-841.)
 
4    (40 ILCS 5/14-133)  (from Ch. 108 1/2, par. 14-133)
5    Sec. 14-133. Contributions on behalf of members.
6    (a) Each participating employee shall make contributions
7to the System, based on the employee's compensation, as
8follows:
9        (1) Covered employees, except as indicated below, 3.5%
10    for retirement annuity, and 0.5% for a widow or survivors
11    annuity;
12        (2) Noncovered employees, except as indicated below,
13    7% for retirement annuity and 1% for a widow or survivors
14    annuity;
15        (3) Noncovered employees serving in a position in which
16    "eligible creditable service" as defined in Section 14-110
17    may be earned, 1% for a widow or survivors annuity plus the
18    following amount for retirement annuity: 8.5% through
19    December 31, 2001; 9.5% in 2002; 10.5% in 2003; and 11.5%
20    in 2004 and thereafter;
21        (4) Covered employees serving in a position in which
22    "eligible creditable service" as defined in Section 14-110
23    may be earned, 0.5% for a widow or survivors annuity plus
24    the following amount for retirement annuity: 5% through
25    December 31, 2001; 6% in 2002; 7% in 2003; and 8% in 2004

 

 

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1    and thereafter;
2        (5) Each security employee of the Department of
3    Corrections or of the Department of Human Services who is a
4    covered employee, 0.5% for a widow or survivors annuity
5    plus the following amount for retirement annuity: 5%
6    through December 31, 2001; 6% in 2002; 7% in 2003; and 8%
7    in 2004 and thereafter;
8        (6) Each security employee of the Department of
9    Corrections or of the Department of Human Services who is
10    not a covered employee, 1% for a widow or survivors annuity
11    plus the following amount for retirement annuity: 8.5%
12    through December 31, 2001; 9.5% in 2002; 10.5% in 2003; and
13    11.5% in 2004 and thereafter.
14    (a-5) In addition to the contributions otherwise required
15under this Article, each Tier I member shall also make the
16following contributions for retirement annuity from each
17payment of compensation:
18        (1) beginning July 1, 2013 and through June 30, 2014,
19    1% of compensation; and
20        (2) beginning on July 1, 2014, 2% of compensation.
21    (b) Contributions shall be in the form of a deduction from
22compensation and shall be made notwithstanding that the
23compensation paid in cash to the employee shall be reduced
24thereby below the minimum prescribed by law or regulation. Each
25member is deemed to consent and agree to the deductions from
26compensation provided for in this Article, and shall receipt in

 

 

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1full for salary or compensation.
2(Source: P.A. 92-14, eff. 6-28-01.)
 
3    (40 ILCS 5/14-133.5 new)
4    Sec. 14-133.5. Use of contributions for health care
5subsidies. The System shall not use any contribution received
6by the System under this Article to provide a subsidy for the
7cost of participation in a retiree health care program.
 
8    (40 ILCS 5/14-135.08)  (from Ch. 108 1/2, par. 14-135.08)
9    Sec. 14-135.08. To certify required State contributions.
10    (a) To certify to the Governor and to each department, on
11or before November 15 of each year through until November 15,
122011, the required rate for State contributions to the System
13for the next State fiscal year, as determined under subsection
14(b) of Section 14-131. The certification to the Governor under
15this subsection (a) shall include a copy of the actuarial
16recommendations upon which the rate is based and shall
17specifically identify the System's projected State normal cost
18for that fiscal year.
19    (a-5) On or before November 1 of each year, beginning
20November 1, 2012, the Board shall submit to the State Actuary,
21the Governor, and the General Assembly a proposed certification
22of the amount of the required State contribution to the System
23for the next fiscal year, along with all of the actuarial
24assumptions, calculations, and data upon which that proposed

 

 

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1certification is based. On or before January 1 of each year,
2beginning January 1, 2013, the State Actuary shall issue a
3preliminary report concerning the proposed certification and
4identifying, if necessary, recommended changes in actuarial
5assumptions that the Board must consider before finalizing its
6certification of the required State contributions.
7    On or before January 15, 2013 and each January 15
8thereafter, the Board shall certify to the Governor and the
9General Assembly the amount of the required State contribution
10for the next fiscal year. The certification shall include a
11copy of the actuarial recommendations upon which it is based
12and shall specifically identify the System's projected State
13normal cost for that fiscal year. The Board's certification
14must note any deviations from the State Actuary's recommended
15changes, the reason or reasons for not following the State
16Actuary's recommended changes, and the fiscal impact of not
17following the State Actuary's recommended changes on the
18required State contribution.
19    (b) The certifications under subsections (a) and (a-5)
20shall include an additional amount necessary to pay all
21principal of and interest on those general obligation bonds due
22the next fiscal year authorized by Section 7.2(a) of the
23General Obligation Bond Act and issued to provide the proceeds
24deposited by the State with the System in July 2003,
25representing deposits other than amounts reserved under
26Section 7.2(c) of the General Obligation Bond Act. For State

 

 

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1fiscal year 2005, the Board shall make a supplemental
2certification of the additional amount necessary to pay all
3principal of and interest on those general obligation bonds due
4in State fiscal years 2004 and 2005 authorized by Section
57.2(a) of the General Obligation Bond Act and issued to provide
6the proceeds deposited by the State with the System in July
72003, representing deposits other than amounts reserved under
8Section 7.2(c) of the General Obligation Bond Act, as soon as
9practical after the effective date of this amendatory Act of
10the 93rd General Assembly.
11    On or before May 1, 2004, the Board shall recalculate and
12recertify to the Governor and to each department the amount of
13the required State contribution to the System and the required
14rates for State contributions to the System for State fiscal
15year 2005, taking into account the amounts appropriated to and
16received by the System under subsection (d) of Section 7.2 of
17the General Obligation Bond Act.
18    On or before July 1, 2005, the Board shall recalculate and
19recertify to the Governor and to each department the amount of
20the required State contribution to the System and the required
21rates for State contributions to the System for State fiscal
22year 2006, taking into account the changes in required State
23contributions made by this amendatory Act of the 94th General
24Assembly.
25    On or before April 1, 2011, the Board shall recalculate and
26recertify to the Governor and to each department the amount of

 

 

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1the required State contribution to the System for State fiscal
2year 2011, applying the changes made by Public Act 96-889 to
3the System's assets and liabilities as of June 30, 2009 as
4though Public Act 96-889 was approved on that date.
5(Source: P.A. 96-1497, eff. 1-14-11; 96-1511, eff. 1-27-11;
697-694, eff. 6-18-12.)
 
7    (40 ILCS 5/14-152.1)
8    Sec. 14-152.1. Application and expiration of new benefit
9increases.
10    (a) As used in this Section, "new benefit increase" means
11an increase in the amount of any benefit provided under this
12Article, or an expansion of the conditions of eligibility for
13any benefit under this Article, that results from an amendment
14to this Code that takes effect after June 1, 2005 (the
15effective date of Public Act 94-4). "New benefit increase",
16however, does not include any benefit increase resulting from
17the changes made to this Article or Article 1 by Public Act
1896-37 or by this amendatory Act of the 98th 96th General
19Assembly.
20    (b) Notwithstanding any other provision of this Code or any
21subsequent amendment to this Code, every new benefit increase
22is subject to this Section and shall be deemed to be granted
23only in conformance with and contingent upon compliance with
24the provisions of this Section.
25    (c) The Public Act enacting a new benefit increase must

 

 

09800SB0001ham001- 151 -LRB098 05457 EFG 45203 a

1identify and provide for payment to the System of additional
2funding at least sufficient to fund the resulting annual
3increase in cost to the System as it accrues.
4    Every new benefit increase is contingent upon the General
5Assembly providing the additional funding required under this
6subsection. The Commission on Government Forecasting and
7Accountability shall analyze whether adequate additional
8funding has been provided for the new benefit increase and
9shall report its analysis to the Public Pension Division of the
10Department of Financial and Professional Regulation. A new
11benefit increase created by a Public Act that does not include
12the additional funding required under this subsection is null
13and void. If the Public Pension Division determines that the
14additional funding provided for a new benefit increase under
15this subsection is or has become inadequate, it may so certify
16to the Governor and the State Comptroller and, in the absence
17of corrective action by the General Assembly, the new benefit
18increase shall expire at the end of the fiscal year in which
19the certification is made.
20    (d) Every new benefit increase shall expire 5 years after
21its effective date or on such earlier date as may be specified
22in the language enacting the new benefit increase or provided
23under subsection (c). This does not prevent the General
24Assembly from extending or re-creating a new benefit increase
25by law.
26    (e) Except as otherwise provided in the language creating

 

 

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1the new benefit increase, a new benefit increase that expires
2under this Section continues to apply to persons who applied
3and qualified for the affected benefit while the new benefit
4increase was in effect and to the affected beneficiaries and
5alternate payees of such persons, but does not apply to any
6other person, including without limitation a person who
7continues in service after the expiration date and did not
8apply and qualify for the affected benefit while the new
9benefit increase was in effect.
10(Source: P.A. 96-37, eff. 7-13-09.)
 
11    (40 ILCS 5/15-106)  (from Ch. 108 1/2, par. 15-106)
12    Sec. 15-106. Employer. "Employer": The University of
13Illinois, Southern Illinois University, Chicago State
14University, Eastern Illinois University, Governors State
15University, Illinois State University, Northeastern Illinois
16University, Northern Illinois University, Western Illinois
17University, the State Board of Higher Education, the Illinois
18Mathematics and Science Academy, the University Civil Service
19Merit Board, the Board of Trustees of the State Universities
20Retirement System, the Illinois Community College Board,
21community college boards, any association of community college
22boards organized under Section 3-55 of the Public Community
23College Act, the Board of Examiners established under the
24Illinois Public Accounting Act, and, only during the period for
25which employer contributions required under Section 15-155 are

 

 

09800SB0001ham001- 153 -LRB098 05457 EFG 45203 a

1paid, the following organizations: the alumni associations,
2the foundations and the athletic associations which are
3affiliated with the universities and colleges included in this
4Section as employers. An individual that begins employment
5after the effective date of this amendatory Act of the 98th
6General Assembly with an entity not defined as an employer in
7this Section shall not be deemed an employee for the purposes
8of this Article with respect to that employment and shall not
9be eligible to participate in the System with respect to that
10employment; provided, however, that those individuals who are
11both employed and already participants in the System on the
12effective date of this amendatory Act of the 98th General
13Assembly shall be allowed to continue as participants in the
14System for the duration of that employment.
15    Notwithstanding any provision of law to the contrary, an
16individual who begins employment with any of the following
17employers on or after the effective date of this amendatory Act
18of the 98th General Assembly shall not be deemed an employee
19and shall not be eligible to participate in the System with
20respect to that employment: any association of community
21college boards organized under Section 3-55 of the Public
22Community College Act, the Association of Illinois
23Middle-Grade Schools, the Illinois Association of School
24Administrators, the Illinois Association for Supervision and
25Curriculum Development, the Illinois Principals Association,
26the Illinois Association of School Business Officials, or the

 

 

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1Illinois Special Olympics; provided, however, that those
2individuals who are both employed and already participants in
3the System on the effective date of this amendatory Act of the
498th General Assembly shall be allowed to continue as
5participants in the System for the duration of that employment.
6    A department as defined in Section 14-103.04 is an employer
7for any person appointed by the Governor under the Civil
8Administrative Code of Illinois who is a participating employee
9as defined in Section 15-109. The Department of Central
10Management Services is an employer with respect to persons
11employed by the State Board of Higher Education in positions
12with the Illinois Century Network as of June 30, 2004 who
13remain continuously employed after that date by the Department
14of Central Management Services in positions with the Illinois
15Century Network, the Bureau of Communication and Computer
16Services, or, if applicable, any successor bureau.
17    The cities of Champaign and Urbana shall be considered
18employers, but only during the period for which contributions
19are required to be made under subsection (b-1) of Section
2015-155 and only with respect to individuals described in
21subsection (h) of Section 15-107.
22(Source: P.A. 95-369, eff. 8-23-07; 95-728, eff. 7-1-08 - See
23Sec. 999.)
 
24    (40 ILCS 5/15-107)  (from Ch. 108 1/2, par. 15-107)
25    Sec. 15-107. Employee.

 

 

09800SB0001ham001- 155 -LRB098 05457 EFG 45203 a

1    (a) "Employee" means any member of the educational,
2administrative, secretarial, clerical, mechanical, labor or
3other staff of an employer whose employment is permanent and
4continuous or who is employed in a position in which services
5are expected to be rendered on a continuous basis for at least
64 months or one academic term, whichever is less, who (A)
7receives payment for personal services on a warrant issued
8pursuant to a payroll voucher certified by an employer and
9drawn by the State Comptroller upon the State Treasurer or by
10an employer upon trust, federal or other funds, or (B) is on a
11leave of absence without pay. Employment which is irregular,
12intermittent or temporary shall not be considered continuous
13for purposes of this paragraph.
14    However, a person is not an "employee" if he or she:
15        (1) is a student enrolled in and regularly attending
16    classes in a college or university which is an employer,
17    and is employed on a temporary basis at less than full
18    time;
19        (2) is currently receiving a retirement annuity or a
20    disability retirement annuity under Section 15-153.2 from
21    this System;
22        (3) is on a military leave of absence;
23        (4) is eligible to participate in the Federal Civil
24    Service Retirement System and is currently making
25    contributions to that system based upon earnings paid by an
26    employer;

 

 

09800SB0001ham001- 156 -LRB098 05457 EFG 45203 a

1        (5) is on leave of absence without pay for more than 60
2    days immediately following termination of disability
3    benefits under this Article;
4        (6) is hired after June 30, 1979 as a public service
5    employment program participant under the Federal
6    Comprehensive Employment and Training Act and receives
7    earnings in whole or in part from funds provided under that
8    Act; or
9        (7) is employed on or after July 1, 1991 to perform
10    services that are excluded by subdivision (a)(7)(f) or
11    (a)(19) of Section 210 of the federal Social Security Act
12    from the definition of employment given in that Section (42
13    U.S.C. 410).
14    (b) Any employer may, by filing a written notice with the
15board, exclude from the definition of "employee" all persons
16employed pursuant to a federally funded contract entered into
17after July 1, 1982 with a federal military department in a
18program providing training in military courses to federal
19military personnel on a military site owned by the United
20States Government, if this exclusion is not prohibited by the
21federally funded contract or federal laws or rules governing
22the administration of the contract.
23    (c) Any person appointed by the Governor under the Civil
24Administrative Code of the State is an employee, if he or she
25is a participant in this system on the effective date of the
26appointment.

 

 

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1    (d) A participant on lay-off status under civil service
2rules is considered an employee for not more than 120 days from
3the date of the lay-off.
4    (e) A participant is considered an employee during (1) the
5first 60 days of disability leave, (2) the period, not to
6exceed one year, in which his or her eligibility for disability
7benefits is being considered by the board or reviewed by the
8courts, and (3) the period he or she receives disability
9benefits under the provisions of Section 15-152, workers'
10compensation or occupational disease benefits, or disability
11income under an insurance contract financed wholly or partially
12by the employer.
13    (f) Absences without pay, other than formal leaves of
14absence, of less than 30 calendar days, are not considered as
15an interruption of a person's status as an employee. If such
16absences during any period of 12 months exceed 30 work days,
17the employee status of the person is considered as interrupted
18as of the 31st work day.
19    (g) A staff member whose employment contract requires
20services during an academic term is to be considered an
21employee during the summer and other vacation periods, unless
22he or she declines an employment contract for the succeeding
23academic term or his or her employment status is otherwise
24terminated, and he or she receives no earnings during these
25periods.
26    (h) An individual who was a participating employee employed

 

 

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1in the fire department of the University of Illinois's
2Champaign-Urbana campus immediately prior to the elimination
3of that fire department and who immediately after the
4elimination of that fire department became employed by the fire
5department of the City of Urbana or the City of Champaign shall
6continue to be considered as an employee for purposes of this
7Article for so long as the individual remains employed as a
8firefighter by the City of Urbana or the City of Champaign. The
9individual shall cease to be considered an employee under this
10subsection (h) upon the first termination of the individual's
11employment as a firefighter by the City of Urbana or the City
12of Champaign.
13    (i) An individual who is employed on a full-time basis as
14an officer or employee of a statewide teacher organization that
15serves System participants or an officer of a national teacher
16organization that serves System participants may participate
17in the System and shall be deemed an employee, provided that
18(1) the individual has previously earned creditable service
19under this Article, (2) the individual files with the System an
20irrevocable election to become a participant before the
21effective date of this amendatory Act of the 97th General
22Assembly, (3) the individual does not receive credit for that
23employment under any other Article of this Code, and (4) the
24individual first became a full-time employee of the teacher
25organization and becomes a participant before the effective
26date of this amendatory Act of the 97th General Assembly. An

 

 

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1employee under this subsection (i) is responsible for paying to
2the System both (A) employee contributions based on the actual
3compensation received for service with the teacher
4organization and (B) employer contributions equal to the normal
5costs (as defined in Section 15-155) resulting from that
6service; all or any part of these contributions may be paid on
7the employee's behalf or picked up for tax purposes (if
8authorized under federal law) by the teacher organization.
9    A person who is an employee as defined in this subsection
10(i) may establish service credit for similar employment prior
11to becoming an employee under this subsection by paying to the
12System for that employment the contributions specified in this
13subsection, plus interest at the effective rate from the date
14of service to the date of payment. However, credit shall not be
15granted under this subsection for any such prior employment for
16which the applicant received credit under any other provision
17of this Code, or during which the applicant was on a leave of
18absence under Section 15-113.2.
19    (j) A person employed by the State Board of Higher
20Education in a position with the Illinois Century Network as of
21June 30, 2004 shall be considered to be an employee for so long
22as he or she remains continuously employed after that date by
23the Department of Central Management Services in a position
24with the Illinois Century Network, the Bureau of Communication
25and Computer Services, or, if applicable, any successor bureau
26and meets the requirements of subsection (a).

 

 

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1    (k) In the case of doubt as to whether any person is an
2employee within the meaning of this Section, the decision of
3the Board shall be final.
4(Source: P.A. 97-651, eff. 1-5-12.)
 
5    (40 ILCS 5/15-107.1 new)
6    Sec. 15-107.1. Tier I participant. "Tier I participant": A
7participant under this Article, other than a participant in the
8self-managed plan under Section 15-158.2, who first became a
9member or participant before January 1, 2011 under any
10reciprocal retirement system or pension fund established under
11this Code other than a retirement system or pension fund
12established under Article 2, 3, 4, 5, 6, or 18 of this Code.
 
13    (40 ILCS 5/15-107.2 new)
14    Sec. 15-107.2. Tier I retiree. "Tier I retiree": A former
15Tier I participant who is receiving a retirement annuity.
16    A person does not become a Tier I retiree by virtue of
17receiving a reversionary, survivors, beneficiary, or
18disability annuity.
 
19    (40 ILCS 5/15-111)  (from Ch. 108 1/2, par. 15-111)
20    Sec. 15-111. Earnings. "Earnings": An amount paid for
21personal services equal to the sum of the basic compensation
22plus extra compensation for summer teaching, overtime or other
23extra service. For periods for which an employee receives

 

 

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1service credit under subsection (c) of Section 15-113.1 or
2Section 15-113.2, earnings are equal to the basic compensation
3on which contributions are paid by the employee during such
4periods. Compensation for employment which is irregular,
5intermittent and temporary shall not be considered earnings,
6unless the participant is also receiving earnings from the
7employer as an employee under Section 15-107.
8    With respect to transition pay paid by the University of
9Illinois to a person who was a participating employee employed
10in the fire department of the University of Illinois's
11Champaign-Urbana campus immediately prior to the elimination
12of that fire department:
13        (1) "Earnings" includes transition pay paid to the
14    employee on or after the effective date of this amendatory
15    Act of the 91st General Assembly.
16        (2) "Earnings" includes transition pay paid to the
17    employee before the effective date of this amendatory Act
18    of the 91st General Assembly only if (i) employee
19    contributions under Section 15-157 have been withheld from
20    that transition pay or (ii) the employee pays to the System
21    before January 1, 2001 an amount representing employee
22    contributions under Section 15-157 on that transition pay.
23    Employee contributions under item (ii) may be paid in a
24    lump sum, by withholding from additional transition pay
25    accruing before January 1, 2001, or in any other manner
26    approved by the System. Upon payment of the employee

 

 

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1    contributions on transition pay, the corresponding
2    employer contributions become an obligation of the State.
3    Notwithstanding any other provision of this Code, the
4earnings of a Tier I participant for the purposes of this Code
5shall not exceed, for periods of service on or after the
6effective date of this amendatory Act of the 98th General
7Assembly, the greater of (i) the limitation determined from
8time to time under subsection (b-5) of Section 1-160 of this
9Code for persons subject to that Section or (ii) the annual
10earnings of the participant during the 365 days immediately
11preceding that effective date; except that this limitation does
12not apply to a participant's earnings that are determined under
13an employment contract or collective bargaining agreement that
14is in effect on the effective date of this amendatory Act of
15the 98th General Assembly and has not been amended or renewed
16after that date.
17(Source: P.A. 91-887, eff. 7-6-00.)
 
18    (40 ILCS 5/15-112)  (from Ch. 108 1/2, par. 15-112)
19    Sec. 15-112. Final rate of earnings.
20    "Final rate of earnings":
21    (a) This subsection (a) applies only to a person who first
22becomes a participant of any system before January 1, 2011.
23     For an employee who is paid on an hourly basis or who
24receives an annual salary in installments during 12 months of
25each academic year, the average annual earnings during the 48

 

 

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1consecutive calendar month period ending with the last day of
2final termination of employment or the 4 consecutive academic
3years of service in which the employee's earnings were the
4highest, whichever is greater. For any other employee, the
5average annual earnings during the 4 consecutive academic years
6of service in which his or her earnings were the highest. For
7an employee with less than 48 months or 4 consecutive academic
8years of service, the average earnings during his or her entire
9period of service. The earnings of an employee with more than
1036 months of service prior to the date of becoming a
11participant are, for such period, considered equal to the
12average earnings during the last 36 months of such service.
13    (b) This subsection (b) applies to a person to whom
14subsection (a) does not apply.
15    For an employee who is paid on an hourly basis or who
16receives an annual salary in installments during 12 months of
17each academic year, the average annual earnings obtained by
18dividing by 8 the total earnings of the employee during the 96
19consecutive months in which the total earnings were the highest
20within the last 120 months prior to termination.
21    For any other employee, the average annual earnings during
22the 8 consecutive academic years within the 10 years prior to
23termination in which the employee's earnings were the highest.
24For an employee with less than 96 consecutive months or 8
25consecutive academic years of service, whichever is necessary,
26the average earnings during his or her entire period of

 

 

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1service.
2    (c) For an employee on leave of absence with pay, or on
3leave of absence without pay who makes contributions during
4such leave, earnings are assumed to be equal to the basic
5compensation on the date the leave began.
6    (d) For an employee on disability leave, earnings are
7assumed to be equal to the basic compensation on the date
8disability occurs or the average earnings during the 24 months
9immediately preceding the month in which disability occurs,
10whichever is greater.
11    (e) For a participant who retires on or after the effective
12date of this amendatory Act of 1997 with at least 20 years of
13service as a firefighter or police officer under this Article,
14the final rate of earnings shall be the annual rate of earnings
15received by the participant on his or her last day as a
16firefighter or police officer under this Article, if that is
17greater than the final rate of earnings as calculated under the
18other provisions of this Section.
19    (f) If a participant to whom subsection (a) of this Section
20applies is an employee for at least 6 months during the
21academic year in which his or her employment is terminated, the
22annual final rate of earnings shall be 25% of the sum of (1)
23the annual basic compensation for that year, and (2) the amount
24earned during the 36 months immediately preceding that year, if
25this is greater than the final rate of earnings as calculated
26under the other provisions of this Section.

 

 

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1    (g) In the determination of the final rate of earnings for
2an employee, that part of an employee's earnings for any
3academic year beginning after June 30, 1997, which exceeds the
4employee's earnings with that employer for the preceding year
5by more than 20 percent shall be excluded; in the event that an
6employee has more than one employer this limitation shall be
7calculated separately for the earnings with each employer. In
8making such calculation, only the basic compensation of
9employees shall be considered, without regard to vacation or
10overtime or to contracts for summer employment.
11    (h) The following are not considered as earnings in
12determining final rate of earnings: (1) severance or separation
13pay, (2) retirement pay, (3) payment for unused sick leave, and
14(4) payments from an employer for the period used in
15determining final rate of earnings for any purpose other than
16(i) services rendered, (ii) leave of absence or vacation
17granted during that period, and (iii) vacation of up to 56 work
18days allowed upon termination of employment; except that, if
19the benefit has been collectively bargained between the
20employer and the recognized collective bargaining agent
21pursuant to the Illinois Educational Labor Relations Act,
22payment received during a period of up to 2 academic years for
23unused sick leave may be considered as earnings in accordance
24with the applicable collective bargaining agreement, subject
25to the 20% increase limitation of this Section, and if the
26person first becomes a participant on or after the effective

 

 

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1date of this amendatory Act of the 98th General Assembly,
2payments for unused sick or vacation time shall not be
3considered as earnings. Any unused sick leave considered as
4earnings under this Section shall not be taken into account in
5calculating service credit under Section 15-113.4.
6    (i) Intermittent periods of service shall be considered as
7consecutive in determining final rate of earnings.
8(Source: P.A. 96-1490, eff. 1-1-11.)
 
9    (40 ILCS 5/15-113.4)  (from Ch. 108 1/2, par. 15-113.4)
10    Sec. 15-113.4. Service for unused sick leave. "Service for
11unused sick leave": A person who first becomes a participant
12before the effective date of this amendatory Act of the 98th
13General Assembly and who is an employee under this System or
14one of the other systems subject to Article 20 of this Code
15within 60 days immediately preceding the date on which his or
16her retirement annuity begins, is entitled to credit for
17service for that portion of unused sick leave earned in the
18course of employment with an employer and credited on the date
19of termination of employment by an employer for which payment
20is not received, in accordance with the following schedule: 30
21through 90 full calendar days and 20 through 59 full work days
22of unused sick leave, 1/4 of a year of service; 91 through 180
23full calendar days and 60 through 119 full work days, 1/2 of a
24year of service; 181 through 270 full calendar days and 120
25through 179 full work days, 3/4 of a year of service; 271

 

 

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1through 360 full calendar days and 180 through 240 full work
2days, one year of service. Only uncompensated, unused sick
3leave earned in accordance with an employer's sick leave
4accrual policy generally applicable to employees or a class of
5employees shall be taken into account in calculating service
6credit under this Section. Any uncompensated, unused sick leave
7granted by an employer to facilitate the hiring, retirement,
8termination, or other special circumstances of an employee
9shall not be taken into account in calculating service credit
10under this Section. If a participant transfers from one
11employer to another, the unused sick leave credited by the
12previous employer shall be considered in determining service to
13be credited under this Section, even if the participant
14terminated service prior to the effective date of P.A. 86-272
15(August 23, 1989); if necessary, the retirement annuity shall
16be recalculated to reflect such sick leave credit. Each
17employer shall certify to the board the number of days of
18unused sick leave accrued to the participant's credit on the
19date that the participant's status as an employee terminated.
20This period of unused sick leave shall not be considered in
21determining the date the retirement annuity begins. A person
22who first becomes a participant on or after the effective date
23of this amendatory Act of the 98th General Assembly shall not
24receive service credit for unused sick leave.
25(Source: P.A. 90-65, eff. 7-7-97; 90-511, eff. 8-22-97.)
 

 

 

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1    (40 ILCS 5/15-113.7)  (from Ch. 108 1/2, par. 15-113.7)
2    Sec. 15-113.7. Service for other public employment.
3"Service for other public employment": Includes those periods
4not exceeding the lesser of 10 years or 2/3 of the service
5granted under other Sections of this Article dealing with
6service credit, during which a person was employed full time by
7the United States government, or by the government of a state,
8or by a political subdivision of a state, or by an agency or
9instrumentality of any of the foregoing, if the person (1)
10cannot qualify for a retirement pension or other benefit based
11upon employer contributions from another retirement system,
12exclusive of federal social security, based in whole or in part
13upon this employment, and (2) pays the lesser of (A) an amount
14equal to 8% of his or her annual basic compensation on the date
15of becoming a participating employee subsequent to this service
16multiplied by the number of years of such service, together
17with compound interest from the date participation begins to
18the date payment is received by the board at the rate of 6% per
19annum through August 31, 1982, and at the effective rates after
20that date, and (B) 50% of the actuarial value of the increase
21in the retirement annuity provided by this service, and (3)
22contributes for at least 5 years subsequent to this employment
23to one or more of the following systems: the State Universities
24Retirement System, the Teachers' Retirement System of the State
25of Illinois, and the Public School Teachers' Pension and
26Retirement Fund of Chicago. If a function of a governmental

 

 

09800SB0001ham001- 169 -LRB098 05457 EFG 45203 a

1unit as defined by Section 20-107 is transferred by law, in
2whole or in part to an employer, and an employee transfers
3employment from this governmental unit to such employer within
46 months of the transfer of the function, the payment for
5service authorized under this Section shall not exceed the
6amount which would have been payable for this service to the
7retirement system covering the governmental unit from which the
8function was transferred.
9    The service granted under this Section shall not be
10considered in determining whether the person has the minimum of
118 years of service required to qualify for a retirement annuity
12at age 55 or the 5 years of service required to qualify for a
13retirement annuity at age 62, as provided in Section 15-135 or
14the 10 years required by subsection (c) of Section 1-160. The
15maximum allowable service of 10 years for this governmental
16employment shall be reduced by the service credit which is
17validated under paragraph (2) of subsection (b) of Section
1816-127 and paragraph one of Section 17-133.
19    Except as hereinafter provided, this Section shall not
20apply to persons who become participants in the system after
21September 1, 1974.
22(Source: P.A. 95-83, eff. 8-13-07.)
 
23    (40 ILCS 5/15-125)  (from Ch. 108 1/2, par. 15-125)
24    Sec. 15-125. "Prescribed Rate of Interest; Effective Rate
25of Interest".

 

 

09800SB0001ham001- 170 -LRB098 05457 EFG 45203 a

1    (1) "Prescribed rate of interest": The rate of interest to
2be used in actuarial valuations and in development of actuarial
3tables as determined by the board on the basis of the probable
4average effective rate of interest on a long term basis.
5    (2) "Effective rate of interest": The interest rate for all
6or any part of a fiscal year that is determined by the State
7Comptroller board based on factors including the system's past
8and expected investment experience; historical and expected
9fluctuations in the market value of investments; the
10desirability of minimizing volatility in the effective rate of
11interest from year to year; and the provision of reserves for
12anticipated losses upon sales, redemptions, or other
13disposition of investments and for variations in interest
14experience; except that for the purpose of determining the
15accumulated normal contributions used in calculating
16retirement annuities under Rule 2 of Section 15-136, the
17effective rate of interest shall be determined by the State
18Comptroller rather than the board. The State Comptroller shall
19determine the effective rate of interest to be used for this
20purpose using the factors listed above, and shall certify to
21the board and the Commission on Government Forecasting and
22Accountability the rate to be used for this purpose for fiscal
23year 2006 as soon as possible after the effective date of this
24amendatory Act of the 94th General Assembly, and for each
25fiscal year thereafter no later than the January 31 immediately
26preceding the start of that fiscal year.

 

 

09800SB0001ham001- 171 -LRB098 05457 EFG 45203 a

1    (2.1) The phrase "expected investment experience" as
2providing special consideration to the rates of return achieved
3by long-term U.S. Treasury Bonds. Subject to the limitations
4set forth in Section 1-103.1 of the Pension Code the definition
5of this phrase is a declaration of existing law and shall not
6be construed as a new enactment.
7    (3) The change made to this Section by Public Acts 90-65
8and 90-511 is a clarification of existing law.
9(Source: P.A. 94-4, eff. 6-1-05; 94-982, eff. 6-30-06.)
 
10    (40 ILCS 5/15-135)  (from Ch. 108 1/2, par. 15-135)
11    Sec. 15-135. Retirement annuities - Conditions.
12    (a) A participant who retires in one of the following
13specified years with the specified amount of service is
14entitled to a retirement annuity at any age under the
15retirement program applicable to the participant:
16        35 years if retirement is in 1997 or before;
17        34 years if retirement is in 1998;
18        33 years if retirement is in 1999;
19        32 years if retirement is in 2000;
20        31 years if retirement is in 2001;
21        30 years if retirement is in 2002 or later.
22    A participant with 8 or more years of service after
23September 1, 1941, is entitled to a retirement annuity on or
24after attainment of age 55.
25    A participant with at least 5 but less than 8 years of

 

 

09800SB0001ham001- 172 -LRB098 05457 EFG 45203 a

1service after September 1, 1941, is entitled to a retirement
2annuity on or after attainment of age 62.
3    A participant who has at least 25 years of service in this
4system as a police officer or firefighter is entitled to a
5retirement annuity on or after the attainment of age 50, if
6Rule 4 of Section 15-136 is applicable to the participant.
7    (a-5) Notwithstanding subsection (a) of this Section, for a
8Tier I participant who begins receiving a retirement annuity
9under this Article on or after July 1, 2013:
10        (1) If the Tier I participant is at least 45 years old
11    on the effective date of this amendatory Act of the 98th
12    General Assembly, then the reference to retirement with 30
13    years of service as well as the references to age 50, 55,
14    and 62 in subsection (a) of this Section remain unchanged.
15        (2) If the Tier I participant is at least 40 but less
16    than 45 years old on the effective date of this amendatory
17    Act of the 98th General Assembly, then the reference to
18    retirement with 30 years of service as well as the
19    references to age 50, 55, and 62 in subsection (a) of this
20    Section shall be increased by one year.
21        (3) If the Tier I participant is at least 35 but less
22    than 40 years old on the effective date of this amendatory
23    Act of the 98th General Assembly, then the reference to
24    retirement with 30 years of service as well as the
25    references to age 50, 55, and 62 in subsection (a) of this
26    Section shall be increased by 3 years.

 

 

09800SB0001ham001- 173 -LRB098 05457 EFG 45203 a

1        (4) If the Tier I participant is less than 35 years old
2    on the effective date of this amendatory Act of the 98th
3    General Assembly, then the reference to retirement with 30
4    years of service as well as the references to age 50, 55,
5    and 62 in subsection (a) of this Section shall be increased
6    by 5 years.
7    Notwithstanding Section 1-103.1, this subsection (a-5)
8applies without regard to whether or not the Tier I participant
9is in active service under this Article on or after the
10effective date of this amendatory Act of the 98th General
11Assembly.
12    (b) The annuity payment period shall begin on the date
13specified by the participant or the recipient of a disability
14retirement annuity submitting a written application, which
15date shall not be prior to termination of employment or more
16than one year before the application is received by the board;
17however, if the participant is not an employee of an employer
18participating in this System or in a participating system as
19defined in Article 20 of this Code on April 1 of the calendar
20year next following the calendar year in which the participant
21attains age 70 1/2, the annuity payment period shall begin on
22that date regardless of whether an application has been filed.
23    (c) An annuity is not payable if the amount provided under
24Section 15-136 is less than $10 per month.
25(Source: P.A. 97-933, eff. 8-10-12; 97-968, eff. 8-16-12.)
 

 

 

09800SB0001ham001- 174 -LRB098 05457 EFG 45203 a

1    (40 ILCS 5/15-136)  (from Ch. 108 1/2, par. 15-136)
2    Sec. 15-136. Retirement annuities - Amount. The provisions
3of this Section 15-136 apply only to those participants who are
4participating in the traditional benefit package or the
5portable benefit package and do not apply to participants who
6are participating in the self-managed plan.
7    (a) The amount of a participant's retirement annuity,
8expressed in the form of a single-life annuity, shall be
9determined by whichever of the following rules is applicable
10and provides the largest annuity:
11    Rule 1: The retirement annuity shall be 1.67% of final rate
12of earnings for each of the first 10 years of service, 1.90%
13for each of the next 10 years of service, 2.10% for each year
14of service in excess of 20 but not exceeding 30, and 2.30% for
15each year in excess of 30; or for persons who retire on or
16after January 1, 1998, 2.2% of the final rate of earnings for
17each year of service.
18    Rule 2: The retirement annuity shall be the sum of the
19following, determined from amounts credited to the participant
20in accordance with the actuarial tables and the effective rate
21of interest in effect at the time the retirement annuity
22begins:
23        (i) the normal annuity which can be provided on an
24    actuarially equivalent basis, by the accumulated normal
25    contributions as of the date the annuity begins;
26        (ii) an annuity from employer contributions of an

 

 

09800SB0001ham001- 175 -LRB098 05457 EFG 45203 a

1    amount equal to that which can be provided on an
2    actuarially equivalent basis from the accumulated normal
3    contributions made by the participant under Section
4    15-113.6 and Section 15-113.7 plus 1.4 times all other
5    accumulated normal contributions made by the participant;
6    and
7        (iii) the annuity that can be provided on an
8    actuarially equivalent basis from the entire contribution
9    made by the participant under Section 15-113.3.
10    For the purpose of calculating an annuity under this Rule
112, the contribution required under subsection (c-5) of Section
1215-157 shall not be considered when determining the
13participant's accumulated normal contributions under clause
14(i) or the employer contribution under clause (ii).
15    With respect to a police officer or firefighter who retires
16on or after August 14, 1998, the accumulated normal
17contributions taken into account under clauses (i) and (ii) of
18this Rule 2 shall include the additional normal contributions
19made by the police officer or firefighter under Section
2015-157(a).
21    The amount of a retirement annuity calculated under this
22Rule 2 shall be computed solely on the basis of the
23participant's accumulated normal contributions, as specified
24in this Rule and defined in Section 15-116. Neither an employee
25or employer contribution for early retirement under Section
2615-136.2 nor any other employer contribution shall be used in

 

 

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1the calculation of the amount of a retirement annuity under
2this Rule 2.
3    This amendatory Act of the 91st General Assembly is a
4clarification of existing law and applies to every participant
5and annuitant without regard to whether status as an employee
6terminates before the effective date of this amendatory Act.
7    This Rule 2 does not apply to a person who first becomes an
8employee under this Article on or after July 1, 2005.
9    Rule 3: The retirement annuity of a participant who is
10employed at least one-half time during the period on which his
11or her final rate of earnings is based, shall be equal to the
12participant's years of service not to exceed 30, multiplied by
13(1) $96 if the participant's final rate of earnings is less
14than $3,500, (2) $108 if the final rate of earnings is at least
15$3,500 but less than $4,500, (3) $120 if the final rate of
16earnings is at least $4,500 but less than $5,500, (4) $132 if
17the final rate of earnings is at least $5,500 but less than
18$6,500, (5) $144 if the final rate of earnings is at least
19$6,500 but less than $7,500, (6) $156 if the final rate of
20earnings is at least $7,500 but less than $8,500, (7) $168 if
21the final rate of earnings is at least $8,500 but less than
22$9,500, and (8) $180 if the final rate of earnings is $9,500 or
23more, except that the annuity for those persons having made an
24election under Section 15-154(a-1) shall be calculated and
25payable under the portable retirement benefit program pursuant
26to the provisions of Section 15-136.4.

 

 

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1    Rule 4: A participant who is at least age 50 and has 25 or
2more years of service as a police officer or firefighter, and a
3participant who is age 55 or over and has at least 20 but less
4than 25 years of service as a police officer or firefighter,
5shall be entitled to a retirement annuity of 2 1/4% of the
6final rate of earnings for each of the first 10 years of
7service as a police officer or firefighter, 2 1/2% for each of
8the next 10 years of service as a police officer or
9firefighter, and 2 3/4% for each year of service as a police
10officer or firefighter in excess of 20. The retirement annuity
11for all other service shall be computed under Rule 1.
12    For purposes of this Rule 4, a participant's service as a
13firefighter shall also include the following:
14        (i) service that is performed while the person is an
15    employee under subsection (h) of Section 15-107; and
16        (ii) in the case of an individual who was a
17    participating employee employed in the fire department of
18    the University of Illinois's Champaign-Urbana campus
19    immediately prior to the elimination of that fire
20    department and who immediately after the elimination of
21    that fire department transferred to another job with the
22    University of Illinois, service performed as an employee of
23    the University of Illinois in a position other than police
24    officer or firefighter, from the date of that transfer
25    until the employee's next termination of service with the
26    University of Illinois.

 

 

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1    Rule 5: The retirement annuity of a participant who elected
2early retirement under the provisions of Section 15-136.2 and
3who, on or before February 16, 1995, brought administrative
4proceedings pursuant to the administrative rules adopted by the
5System to challenge the calculation of his or her retirement
6annuity shall be the sum of the following, determined from
7amounts credited to the participant in accordance with the
8actuarial tables and the prescribed rate of interest in effect
9at the time the retirement annuity begins:
10        (i) the normal annuity which can be provided on an
11    actuarially equivalent basis, by the accumulated normal
12    contributions as of the date the annuity begins; and
13        (ii) an annuity from employer contributions of an
14    amount equal to that which can be provided on an
15    actuarially equivalent basis from the accumulated normal
16    contributions made by the participant under Section
17    15-113.6 and Section 15-113.7 plus 1.4 times all other
18    accumulated normal contributions made by the participant;
19    and
20        (iii) an annuity which can be provided on an
21    actuarially equivalent basis from the employee
22    contribution for early retirement under Section 15-136.2,
23    and an annuity from employer contributions of an amount
24    equal to that which can be provided on an actuarially
25    equivalent basis from the employee contribution for early
26    retirement under Section 15-136.2.

 

 

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1    In no event shall a retirement annuity under this Rule 5 be
2lower than the amount obtained by adding (1) the monthly amount
3obtained by dividing the combined employee and employer
4contributions made under Section 15-136.2 by the System's
5annuity factor for the age of the participant at the beginning
6of the annuity payment period and (2) the amount equal to the
7participant's annuity if calculated under Rule 1, reduced under
8Section 15-136(b) as if no contributions had been made under
9Section 15-136.2.
10    With respect to a participant who is qualified for a
11retirement annuity under this Rule 5 whose retirement annuity
12began before the effective date of this amendatory Act of the
1391st General Assembly, and for whom an employee contribution
14was made under Section 15-136.2, the System shall recalculate
15the retirement annuity under this Rule 5 and shall pay any
16additional amounts due in the manner provided in Section
1715-186.1 for benefits mistakenly set too low.
18    The amount of a retirement annuity calculated under this
19Rule 5 shall be computed solely on the basis of those
20contributions specifically set forth in this Rule 5. Except as
21provided in clause (iii) of this Rule 5, neither an employee
22nor employer contribution for early retirement under Section
2315-136.2, nor any other employer contribution, shall be used in
24the calculation of the amount of a retirement annuity under
25this Rule 5.
26    The General Assembly has adopted the changes set forth in

 

 

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1Section 25 of this amendatory Act of the 91st General Assembly
2in recognition that the decision of the Appellate Court for the
3Fourth District in Mattis v. State Universities Retirement
4System et al. might be deemed to give some right to the
5plaintiff in that case. The changes made by Section 25 of this
6amendatory Act of the 91st General Assembly are a legislative
7implementation of the decision of the Appellate Court for the
8Fourth District in Mattis v. State Universities Retirement
9System et al. with respect to that plaintiff.
10    The changes made by Section 25 of this amendatory Act of
11the 91st General Assembly apply without regard to whether the
12person is in service as an employee on or after its effective
13date.
14    (b) The retirement annuity provided under Rules 1 and 3
15above shall be reduced by 1/2 of 1% for each month the
16participant is under age 60 at the time of retirement. However,
17this reduction shall not apply in the following cases:
18        (1) For a disabled participant whose disability
19    benefits have been discontinued because he or she has
20    exhausted eligibility for disability benefits under clause
21    (6) of Section 15-152;
22        (2) For a participant who has at least the number of
23    years of service required to retire at any age under
24    subsection (a) of Section 15-135; or
25        (3) For that portion of a retirement annuity which has
26    been provided on account of service of the participant

 

 

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1    during periods when he or she performed the duties of a
2    police officer or firefighter, if these duties were
3    performed for at least 5 years immediately preceding the
4    date the retirement annuity is to begin.
5    (c) The maximum retirement annuity provided under Rules 1,
62, 4, and 5 shall be the lesser of (1) the annual limit of
7benefits as specified in Section 415 of the Internal Revenue
8Code of 1986, as such Section may be amended from time to time
9and as such benefit limits shall be adjusted by the
10Commissioner of Internal Revenue, and (2) 80% of final rate of
11earnings.
12    (d) Subject to the provisions of subsections (d-1) and
13(d-2), an An annuitant whose status as an employee terminates
14after August 14, 1969 shall receive automatic increases in his
15or her retirement annuity as follows:
16    Effective January 1 immediately following the date the
17retirement annuity begins, the annuitant shall receive an
18increase in his or her monthly retirement annuity of 0.125% of
19the monthly retirement annuity provided under Rule 1, Rule 2,
20Rule 3, Rule 4, or Rule 5, contained in this Section,
21multiplied by the number of full months which elapsed from the
22date the retirement annuity payments began to January 1, 1972,
23plus 0.1667% of such annuity, multiplied by the number of full
24months which elapsed from January 1, 1972, or the date the
25retirement annuity payments began, whichever is later, to
26January 1, 1978, plus 0.25% of such annuity multiplied by the

 

 

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1number of full months which elapsed from January 1, 1978, or
2the date the retirement annuity payments began, whichever is
3later, to the effective date of the increase.
4    The annuitant shall receive an increase in his or her
5monthly retirement annuity on each January 1 thereafter during
6the annuitant's life of 3% of the monthly annuity provided
7under Rule 1, Rule 2, Rule 3, Rule 4, or Rule 5 contained in
8this Section. The change made under this subsection by P.A.
981-970 is effective January 1, 1980 and applies to each
10annuitant whose status as an employee terminates before or
11after that date.
12    Beginning January 1, 1990 and except as provided in
13subsections (d-1) and (d-2), all automatic annual increases
14payable under this Section shall be calculated as a percentage
15of the total annuity payable at the time of the increase,
16including all increases previously granted under this Article.
17    The change made in this subsection by P.A. 85-1008 is
18effective January 26, 1988, and is applicable without regard to
19whether status as an employee terminated before that date.
20    (d-1) Notwithstanding any other provision of this Article,
21for a Tier I retiree, the amount of each automatic annual
22increase in retirement annuity occurring on or after the
23effective date of this amendatory Act of the 98th General
24Assembly shall be 3% of the lesser of (1) the total annuity
25payable at the time of the increase, including previous
26increases granted, or (2) $1,000 multiplied by the number of

 

 

09800SB0001ham001- 183 -LRB098 05457 EFG 45203 a

1years of creditable service upon which the annuity is based.
2    (d-2) Notwithstanding any other provision of this Article,
3for a Tier I retiree, the monthly retirement annuity shall
4first be subject to annual increases on the January 1 occurring
5on or next after the attainment of age 67 or the January 1
6occurring on or next after the fifth anniversary of the annuity
7start date, whichever occurs earlier. If on the effective date
8of this amendatory Act of the 98th General Assembly a Tier I
9retiree has already received an annual increase under this
10Section but does not yet meet the new eligibility requirements
11of this subsection, the annual increases already received shall
12continue in force, but no additional annual increase shall be
13granted until the Tier I retiree meets the new eligibility
14requirements.
15    (d-3) Notwithstanding Section 1-103.1, subsections (d-1)
16and (d-2) apply without regard to whether or not the Tier I
17retiree is in active service under this Article on or after the
18effective date of this amendatory Act of the 98th General
19Assembly.
20    (e) If, on January 1, 1987, or the date the retirement
21annuity payment period begins, whichever is later, the sum of
22the retirement annuity provided under Rule 1 or Rule 2 of this
23Section and the automatic annual increases provided under the
24preceding subsection or Section 15-136.1, amounts to less than
25the retirement annuity which would be provided by Rule 3, the
26retirement annuity shall be increased as of January 1, 1987, or

 

 

09800SB0001ham001- 184 -LRB098 05457 EFG 45203 a

1the date the retirement annuity payment period begins,
2whichever is later, to the amount which would be provided by
3Rule 3 of this Section. Such increased amount shall be
4considered as the retirement annuity in determining benefits
5provided under other Sections of this Article. This paragraph
6applies without regard to whether status as an employee
7terminated before the effective date of this amendatory Act of
81987, provided that the annuitant was employed at least
9one-half time during the period on which the final rate of
10earnings was based.
11    (f) A participant is entitled to such additional annuity as
12may be provided on an actuarially equivalent basis, by any
13accumulated additional contributions to his or her credit.
14However, the additional contributions made by the participant
15toward the automatic increases in annuity provided under this
16Section and the contributions made under subsection (c-5) of
17Section 15-157 by this amendatory Act of the 98th General
18Assembly shall not be taken into account in determining the
19amount of such additional annuity.
20    (g) If, (1) by law, a function of a governmental unit, as
21defined by Section 20-107 of this Code, is transferred in whole
22or in part to an employer, and (2) a participant transfers
23employment from such governmental unit to such employer within
246 months after the transfer of the function, and (3) the sum of
25(A) the annuity payable to the participant under Rule 1, 2, or
263 of this Section (B) all proportional annuities payable to the

 

 

09800SB0001ham001- 185 -LRB098 05457 EFG 45203 a

1participant by all other retirement systems covered by Article
220, and (C) the initial primary insurance amount to which the
3participant is entitled under the Social Security Act, is less
4than the retirement annuity which would have been payable if
5all of the participant's pension credits validated under
6Section 20-109 had been validated under this system, a
7supplemental annuity equal to the difference in such amounts
8shall be payable to the participant.
9    (h) On January 1, 1981, an annuitant who was receiving a
10retirement annuity on or before January 1, 1971 shall have his
11or her retirement annuity then being paid increased $1 per
12month for each year of creditable service. On January 1, 1982,
13an annuitant whose retirement annuity began on or before
14January 1, 1977, shall have his or her retirement annuity then
15being paid increased $1 per month for each year of creditable
16service.
17    (i) On January 1, 1987, any annuitant whose retirement
18annuity began on or before January 1, 1977, shall have the
19monthly retirement annuity increased by an amount equal to 8
20per year of creditable service times the number of years that
21have elapsed since the annuity began.
22    (j) For participants to whom subsection (a-5) of Section
2315-135 applies, the references to age 50, 55, and 62 in this
24Section are increased as provided in subsection (a-5) of
25Section 15-135.
26(Source: P.A. 97-933, eff. 8-10-12; 97-968, eff. 8-16-12.)
 

 

 

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1    (40 ILCS 5/15-155)  (from Ch. 108 1/2, par. 15-155)
2    Sec. 15-155. Employer contributions.
3    (a) The State of Illinois shall make contributions by
4appropriations of amounts which, together with the other
5employer contributions from trust, federal, and other funds,
6employee contributions, income from investments, and other
7income of this System, will be sufficient to meet the cost of
8maintaining and administering the System on a 100% 90% funded
9basis in accordance with actuarial recommendations by the end
10of State fiscal year 2044.
11    The Board shall determine the amount of State contributions
12required for each fiscal year on the basis of the actuarial
13tables and other assumptions adopted by the Board and the
14recommendations of the actuary, using the formula in subsection
15(a-1).
16    (a-1) For State fiscal years 2015 through 2044, the minimum
17contribution to the System to be made by the State for each
18fiscal year shall be an amount determined by the System to be
19equal to the sum of (1) the State's portion of the projected
20normal cost for that fiscal year, plus (2) an amount sufficient
21to bring the total assets of the System up to 100% of the total
22actuarial liabilities of the System by the end of State fiscal
23year 2044. In making these determinations, the required State
24contribution shall be calculated each year as a level
25percentage of payroll over the years remaining to and including

 

 

09800SB0001ham001- 187 -LRB098 05457 EFG 45203 a

1fiscal year 2044 and shall be determined under the entry age
2normal actuarial cost method.
3    Beginning in State fiscal year 2045, the minimum State
4contribution for each fiscal year shall be the amount needed to
5maintain the total assets of the System at 100% of the total
6actuarial liabilities of the System.
7    For State fiscal years 2012 and 2014 through 2045, the
8minimum contribution to the System to be made by the State for
9each fiscal year shall be an amount determined by the System to
10be sufficient to bring the total assets of the System up to 90%
11of the total actuarial liabilities of the System by the end of
12State fiscal year 2045. In making these determinations, the
13required State contribution shall be calculated each year as a
14level percentage of payroll over the years remaining to and
15including fiscal year 2045 and shall be determined under the
16projected unit credit actuarial cost method.
17    For State fiscal years 1996 through 2005, the State
18contribution to the System, as a percentage of the applicable
19employee payroll, shall be increased in equal annual increments
20so that by State fiscal year 2011, the State is contributing at
21the rate required under this Section.
22    Notwithstanding any other provision of this Article, the
23total required State contribution for State fiscal year 2006 is
24$166,641,900.
25    Notwithstanding any other provision of this Article, the
26total required State contribution for State fiscal year 2007 is

 

 

09800SB0001ham001- 188 -LRB098 05457 EFG 45203 a

1$252,064,100.
2    For each of State fiscal years 2008 through 2009, the State
3contribution to the System, as a percentage of the applicable
4employee payroll, shall be increased in equal annual increments
5from the required State contribution for State fiscal year
62007, so that by State fiscal year 2011, the State is
7contributing at the rate otherwise required under this Section.
8    Notwithstanding any other provision of this Article, the
9total required State contribution for State fiscal year 2010 is
10$702,514,000 and shall be made from the State Pensions Fund and
11proceeds of bonds sold in fiscal year 2010 pursuant to Section
127.2 of the General Obligation Bond Act, less (i) the pro rata
13share of bond sale expenses determined by the System's share of
14total bond proceeds, (ii) any amounts received from the General
15Revenue Fund in fiscal year 2010, (iii) any reduction in bond
16proceeds due to the issuance of discounted bonds, if
17applicable.
18    Notwithstanding any other provision of this Article, the
19total required State contribution for State fiscal year 2011 is
20the amount recertified by the System on or before April 1, 2011
21pursuant to Section 15-165 and shall be made from the State
22Pensions Fund and proceeds of bonds sold in fiscal year 2011
23pursuant to Section 7.2 of the General Obligation Bond Act,
24less (i) the pro rata share of bond sale expenses determined by
25the System's share of total bond proceeds, (ii) any amounts
26received from the General Revenue Fund in fiscal year 2011, and

 

 

09800SB0001ham001- 189 -LRB098 05457 EFG 45203 a

1(iii) any reduction in bond proceeds due to the issuance of
2discounted bonds, if applicable.
3    Beginning in State fiscal year 2046, the minimum State
4contribution for each fiscal year shall be the amount needed to
5maintain the total assets of the System at 90% of the total
6actuarial liabilities of the System.
7    Amounts received by the System pursuant to Section 25 of
8the Budget Stabilization Act or Section 8.12 of the State
9Finance Act in any fiscal year do not reduce and do not
10constitute payment of any portion of the minimum State
11contribution required under this Article in that fiscal year.
12Such amounts shall not reduce, and shall not be included in the
13calculation of, the required State contributions under this
14Article in any future year until the System has reached a
15funding ratio of at least 100% 90%. A reference in this Article
16to the "required State contribution" or any substantially
17similar term does not include or apply to any amounts payable
18to the System under Section 25 of the Budget Stabilization Act.
19    Notwithstanding any other provision of this Section, the
20required State contribution for State fiscal year 2005 and for
21fiscal year 2008 and each fiscal year thereafter through State
22fiscal year 2014, as calculated under this Section and
23certified under Section 15-165, shall not exceed an amount
24equal to (i) the amount of the required State contribution that
25would have been calculated under this Section for that fiscal
26year if the System had not received any payments under

 

 

09800SB0001ham001- 190 -LRB098 05457 EFG 45203 a

1subsection (d) of Section 7.2 of the General Obligation Bond
2Act, minus (ii) the portion of the State's total debt service
3payments for that fiscal year on the bonds issued in fiscal
4year 2003 for the purposes of that Section 7.2, as determined
5and certified by the Comptroller, that is the same as the
6System's portion of the total moneys distributed under
7subsection (d) of Section 7.2 of the General Obligation Bond
8Act. In determining this maximum for State fiscal years 2008
9through 2010, however, the amount referred to in item (i) shall
10be increased, as a percentage of the applicable employee
11payroll, in equal increments calculated from the sum of the
12required State contribution for State fiscal year 2007 plus the
13applicable portion of the State's total debt service payments
14for fiscal year 2007 on the bonds issued in fiscal year 2003
15for the purposes of Section 7.2 of the General Obligation Bond
16Act, so that, by State fiscal year 2011, the State is
17contributing at the rate otherwise required under this Section.
18    (b) If an employee is paid from trust or federal funds, the
19employer shall pay to the Board contributions from those funds
20which are sufficient to cover the accruing normal costs on
21behalf of the employee. However, universities having employees
22who are compensated out of local auxiliary funds, income funds,
23or service enterprise funds are not required to pay such
24contributions on behalf of those employees. The local auxiliary
25funds, income funds, and service enterprise funds of
26universities shall not be considered trust funds for the

 

 

09800SB0001ham001- 191 -LRB098 05457 EFG 45203 a

1purpose of this Article, but funds of alumni associations,
2foundations, and athletic associations which are affiliated
3with the universities included as employers under this Article
4and other employers which do not receive State appropriations
5are considered to be trust funds for the purpose of this
6Article.
7    (b-1) The City of Urbana and the City of Champaign shall
8each make employer contributions to this System for their
9respective firefighter employees who participate in this
10System pursuant to subsection (h) of Section 15-107. The rate
11of contributions to be made by those municipalities shall be
12determined annually by the Board on the basis of the actuarial
13assumptions adopted by the Board and the recommendations of the
14actuary, and shall be expressed as a percentage of salary for
15each such employee. The Board shall certify the rate to the
16affected municipalities as soon as may be practical. The
17employer contributions required under this subsection shall be
18remitted by the municipality to the System at the same time and
19in the same manner as employee contributions.
20    (c) Through State fiscal year 1995: The total employer
21contribution shall be apportioned among the various funds of
22the State and other employers, whether trust, federal, or other
23funds, in accordance with actuarial procedures approved by the
24Board. State of Illinois contributions for employers receiving
25State appropriations for personal services shall be payable
26from appropriations made to the employers or to the System. The

 

 

09800SB0001ham001- 192 -LRB098 05457 EFG 45203 a

1contributions for Class I community colleges covering earnings
2other than those paid from trust and federal funds, shall be
3payable solely from appropriations to the Illinois Community
4College Board or the System for employer contributions.
5    (d) Beginning in State fiscal year 1996, the required State
6contributions to the System shall be appropriated directly to
7the System and shall be payable through vouchers issued in
8accordance with subsection (c) of Section 15-165, except as
9provided in subsection (g).
10    (e) The State Comptroller shall draw warrants payable to
11the System upon proper certification by the System or by the
12employer in accordance with the appropriation laws and this
13Code.
14    (f) Normal costs under this Section means liability for
15pensions and other benefits which accrues to the System because
16of the credits earned for service rendered by the participants
17during the fiscal year and expenses of administering the
18System, but shall not include the principal of or any
19redemption premium or interest on any bonds issued by the Board
20or any expenses incurred or deposits required in connection
21therewith.
22    (g) If the amount of a participant's earnings for any
23academic year used to determine the final rate of earnings,
24determined on a full-time equivalent basis, exceeds the amount
25of his or her earnings with the same employer for the previous
26academic year, determined on a full-time equivalent basis, by

 

 

09800SB0001ham001- 193 -LRB098 05457 EFG 45203 a

1more than 6%, the participant's employer shall pay to the
2System, in addition to all other payments required under this
3Section and in accordance with guidelines established by the
4System, the present value of the increase in benefits resulting
5from the portion of the increase in earnings that is in excess
6of 6%. This present value shall be computed by the System on
7the basis of the actuarial assumptions and tables used in the
8most recent actuarial valuation of the System that is available
9at the time of the computation. The System may require the
10employer to provide any pertinent information or
11documentation.
12    Whenever it determines that a payment is or may be required
13under this subsection (g), the System shall calculate the
14amount of the payment and bill the employer for that amount.
15The bill shall specify the calculations used to determine the
16amount due. If the employer disputes the amount of the bill, it
17may, within 30 days after receipt of the bill, apply to the
18System in writing for a recalculation. The application must
19specify in detail the grounds of the dispute and, if the
20employer asserts that the calculation is subject to subsection
21(h) or (i) of this Section, must include an affidavit setting
22forth and attesting to all facts within the employer's
23knowledge that are pertinent to the applicability of subsection
24(h) or (i). Upon receiving a timely application for
25recalculation, the System shall review the application and, if
26appropriate, recalculate the amount due.

 

 

09800SB0001ham001- 194 -LRB098 05457 EFG 45203 a

1    The employer contributions required under this subsection
2(g) (f) may be paid in the form of a lump sum within 90 days
3after receipt of the bill. If the employer contributions are
4not paid within 90 days after receipt of the bill, then
5interest will be charged at a rate equal to the System's annual
6actuarially assumed rate of return on investment compounded
7annually from the 91st day after receipt of the bill. Payments
8must be concluded within 3 years after the employer's receipt
9of the bill.
10    (h) This subsection (h) applies only to payments made or
11salary increases given on or after June 1, 2005 but before July
121, 2011. The changes made by Public Act 94-1057 shall not
13require the System to refund any payments received before July
1431, 2006 (the effective date of Public Act 94-1057).
15    When assessing payment for any amount due under subsection
16(g), the System shall exclude earnings increases paid to
17participants under contracts or collective bargaining
18agreements entered into, amended, or renewed before June 1,
192005.
20    When assessing payment for any amount due under subsection
21(g), the System shall exclude earnings increases paid to a
22participant at a time when the participant is 10 or more years
23from retirement eligibility under Section 15-135.
24    When assessing payment for any amount due under subsection
25(g), the System shall exclude earnings increases resulting from
26overload work, including a contract for summer teaching, or

 

 

09800SB0001ham001- 195 -LRB098 05457 EFG 45203 a

1overtime when the employer has certified to the System, and the
2System has approved the certification, that: (i) in the case of
3overloads (A) the overload work is for the sole purpose of
4academic instruction in excess of the standard number of
5instruction hours for a full-time employee occurring during the
6academic year that the overload is paid and (B) the earnings
7increases are equal to or less than the rate of pay for
8academic instruction computed using the participant's current
9salary rate and work schedule; and (ii) in the case of
10overtime, the overtime was necessary for the educational
11mission.
12    When assessing payment for any amount due under subsection
13(g), the System shall exclude any earnings increase resulting
14from (i) a promotion for which the employee moves from one
15classification to a higher classification under the State
16Universities Civil Service System, (ii) a promotion in academic
17rank for a tenured or tenure-track faculty position, or (iii) a
18promotion that the Illinois Community College Board has
19recommended in accordance with subsection (k) of this Section.
20These earnings increases shall be excluded only if the
21promotion is to a position that has existed and been filled by
22a member for no less than one complete academic year and the
23earnings increase as a result of the promotion is an increase
24that results in an amount no greater than the average salary
25paid for other similar positions.
26    (i) When assessing payment for any amount due under

 

 

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1subsection (g), the System shall exclude any salary increase
2described in subsection (h) of this Section given on or after
3July 1, 2011 but before July 1, 2014 under a contract or
4collective bargaining agreement entered into, amended, or
5renewed on or after June 1, 2005 but before July 1, 2011.
6Notwithstanding any other provision of this Section, any
7payments made or salary increases given after June 30, 2014
8shall be used in assessing payment for any amount due under
9subsection (g) of this Section.
10    (j) The System shall prepare a report and file copies of
11the report with the Governor and the General Assembly by
12January 1, 2007 that contains all of the following information:
13        (1) The number of recalculations required by the
14    changes made to this Section by Public Act 94-1057 for each
15    employer.
16        (2) The dollar amount by which each employer's
17    contribution to the System was changed due to
18    recalculations required by Public Act 94-1057.
19        (3) The total amount the System received from each
20    employer as a result of the changes made to this Section by
21    Public Act 94-4.
22        (4) The increase in the required State contribution
23    resulting from the changes made to this Section by Public
24    Act 94-1057.
25    (k) The Illinois Community College Board shall adopt rules
26for recommending lists of promotional positions submitted to

 

 

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1the Board by community colleges and for reviewing the
2promotional lists on an annual basis. When recommending
3promotional lists, the Board shall consider the similarity of
4the positions submitted to those positions recognized for State
5universities by the State Universities Civil Service System.
6The Illinois Community College Board shall file a copy of its
7findings with the System. The System shall consider the
8findings of the Illinois Community College Board when making
9determinations under this Section. The System shall not exclude
10any earnings increases resulting from a promotion when the
11promotion was not submitted by a community college. Nothing in
12this subsection (k) shall require any community college to
13submit any information to the Community College Board.
14    (l) For purposes of determining the required State
15contribution to the System, the value of the System's assets
16shall be equal to the actuarial value of the System's assets,
17which shall be calculated as follows:
18    As of June 30, 2008, the actuarial value of the System's
19assets shall be equal to the market value of the assets as of
20that date. In determining the actuarial value of the System's
21assets for fiscal years after June 30, 2008, any actuarial
22gains or losses from investment return incurred in a fiscal
23year shall be recognized in equal annual amounts over the
245-year period following that fiscal year.
25    (m) For purposes of determining the required State
26contribution to the system for a particular year, the actuarial

 

 

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1value of assets shall be assumed to earn a rate of return equal
2to the system's actuarially assumed rate of return.
3(Source: P.A. 96-43, eff. 7-15-09; 96-1497, eff. 1-14-11;
496-1511, eff. 1-27-11; 96-1554, eff. 3-18-11; 97-813, eff.
57-13-12; revised 10-17-12.)
 
6    (40 ILCS 5/15-156)  (from Ch. 108 1/2, par. 15-156)
7    Sec. 15-156. Obligations of State; funding guarantees.
8    (a) The payment of (1) the required State contributions,
9(2) all benefits granted under this system and (3) all expenses
10in connection with the administration and operation thereof are
11obligations of the State of Illinois to the extent specified in
12this Article. The accumulated employee normal, additional and
13survivors insurance contributions credited to the accounts of
14active and inactive participants shall not be used to pay the
15State's share of the obligations.
16    (b) (Reserved).
17    (c) Beginning July 1, 2013, the State shall be
18contractually obligated to contribute to the System in each
19State fiscal year an amount not less than the sum of (i) the
20State's normal cost for the year and (ii) the portion of the
21unfunded accrued liability assigned to that year by law.
22Notwithstanding any other provision of law, if the State fails
23to pay an amount guaranteed under this subsection, it shall be
24the mandatory fiduciary obligation of the Board to seek payment
25of the guaranteed amount in compliance with the provisions of

 

 

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1this Section and, if the amount remains unpaid, to bring a
2mandamus action in the Supreme Court of Illinois to compel the
3State to make the required payment.
4    If the System submits a voucher for contributions required
5under Section 15-155 and the State fails to pay that voucher
6within 90 days of its receipt, the Board shall submit a written
7request to the Comptroller seeking payment. A copy of the
8request shall be filed with the Secretary of State, and the
9Secretary of State shall provide a copy to the Governor and
10General Assembly. No earlier than the 16th day after the System
11files the request with the Comptroller and Secretary of State,
12if the amount remains unpaid the Board shall commence a
13mandamus action in the Supreme Court of Illinois to compel the
14Comptroller to satisfy the voucher.
15    This subsection (c) constitutes an express waiver of the
16State's sovereign immunity solely to the extent that it permits
17the Board to commence a mandamus action in the Supreme Court of
18Illinois to compel the Comptroller to pay a voucher for the
19contributions required under Section 15-155.
20    (d) Beginning in State fiscal year 2020, the State shall be
21contractually obligated to make the transfers set forth in
22subsections (c-10) and (c-15) of Section 20 of the Budget
23Stabilization Act and to pay to the System its proportionate
24share of the transferred amounts in accordance with Section 25
25of the Budget Stabilization Act. Notwithstanding any other
26provision of law, if the State fails to transfer an amount

 

 

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1guaranteed under this subsection or to pay to the System its
2proportionate share of the transferred amount in accordance
3with Section 25 of the Budget Stabilization Act, it shall be
4the mandatory fiduciary obligation of the Board to seek
5transfer or payment of the guaranteed amount in compliance with
6the provisions of this Section and, if the required amount
7remains untransferred or the required payment remains unpaid,
8to bring a mandamus action in the Supreme Court of Illinois to
9compel the State to make the required transfer or payment or
10both, as the case may be.
11    If the State fails to make a transfer required under
12subsections (c-10) and (c-15) of Section 20 of the Budget
13Stabilization Act or a payment to the System required under
14Section 25 of that Act, the Board shall submit a written
15request to the Comptroller seeking payment. A copy of the
16request shall be filed with the Secretary of State, and the
17Secretary of State shall provide a copy to the Governor and
18General Assembly. No earlier than the 16th day after the System
19files the request with the Comptroller and Secretary of State,
20if the required amount remains untransferred or the required
21payment remains unpaid, the Board shall commence a mandamus
22action in the Supreme Court of Illinois to compel the
23Comptroller to make the required transfer or payment or both,
24as the case may be.
25    This subsection (d) constitutes an express waiver of the
26State's sovereign immunity solely to the extent that it permits

 

 

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1the Board to commence a mandamus action in the Supreme Court of
2Illinois to compel the Comptroller to make a transfer required
3under subsections (c-10) and (c-15) of Section 20 of the Budget
4Stabilization Act and to pay to the System its proportionate
5share of the transferred amount in accordance with Section 25
6of the Budget Stabilization Act.
7    The obligations created by this subsection (d) expire when
8all of the requirements of subsections (c-10) and (c-15) of
9Section 20 of the Budget Stabilization Act and Section 25 of
10the Budget Stabilization Act have been met.
11    (e) Any payments and transfers required to be made by the
12State pursuant to subsection (c) or (d) are expressly
13subordinate to the payment of the principal, interest, and
14premium, if any, on any bonded debt obligation of the State or
15any other State-created entity, either currently outstanding
16or to be issued, for which the source of repayment or security
17thereon is derived directly or indirectly from tax revenues
18collected by the State or any other State-created entity.
19Payments on such bonded obligations includes any statutory fund
20transfers or other prefunding mechanisms or formulas set forth,
21now or hereafter, in State law or bond indentures, into debt
22service funds or accounts of the State related to such bond
23obligations, consistent with the payment schedules associated
24with such obligations.
25    (f) By the enactment of this amendatory Act of the 98th
26General Assembly, the State of Illinois pledges to and agrees

 

 

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1with the Board and members of the System that the State will
2make the payments required under Section 15-155 of this Code,
3the transfers required under subsections (c-10) and (c-15) of
4Section 20 of the Budget Stabilization Act, and the payments to
5the System of its proportionate share of the transferred
6amounts in accordance with Section 25 of the Budget
7Stabilization Act. The State further pledges that the State
8will not limit or alter the rights and powers vested in the
9Board so as to impair the terms of this Section or in any way
10impair the rights and remedies of the Board.
11(Source: P.A. 83-1440.)
 
12    (40 ILCS 5/15-157)  (from Ch. 108 1/2, par. 15-157)
13    Sec. 15-157. Employee Contributions.
14    (a) Each participating employee shall make contributions
15towards the retirement benefits payable under the retirement
16program applicable to the employee from each payment of
17earnings applicable to employment under this system on and
18after the date of becoming a participant as follows: Prior to
19September 1, 1949, 3 1/2% of earnings; from September 1, 1949
20to August 31, 1955, 5%; from September 1, 1955 to August 31,
211969, 6%; from September 1, 1969, 6 1/2%. These contributions
22are to be considered as normal contributions for purposes of
23this Article.
24    Each participant who is a police officer or firefighter
25shall make normal contributions of 8% of each payment of

 

 

09800SB0001ham001- 203 -LRB098 05457 EFG 45203 a

1earnings applicable to employment as a police officer or
2firefighter under this system on or after September 1, 1981,
3unless he or she files with the board within 60 days after the
4effective date of this amendatory Act of 1991 or 60 days after
5the board receives notice that he or she is employed as a
6police officer or firefighter, whichever is later, a written
7notice waiving the retirement formula provided by Rule 4 of
8Section 15-136. This waiver shall be irrevocable. If a
9participant had met the conditions set forth in Section
1015-132.1 prior to the effective date of this amendatory Act of
111991 but failed to make the additional normal contributions
12required by this paragraph, he or she may elect to pay the
13additional contributions plus compound interest at the
14effective rate. If such payment is received by the board, the
15service shall be considered as police officer service in
16calculating the retirement annuity under Rule 4 of Section
1715-136. While performing service described in clause (i) or
18(ii) of Rule 4 of Section 15-136, a participating employee
19shall be deemed to be employed as a firefighter for the purpose
20of determining the rate of employee contributions under this
21Section.
22    (b) Starting September 1, 1969, each participating
23employee shall make additional contributions of 1/2 of 1% of
24earnings to finance a portion of the cost of the annual
25increases in retirement annuity provided under Section 15-136,
26except that with respect to participants in the self-managed

 

 

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1plan this additional contribution shall be used to finance the
2benefits obtained under that retirement program.
3    (c) In addition to the amounts described in subsections (a)
4and (b) of this Section, each participating employee shall make
5contributions of 1% of earnings applicable under this system on
6and after August 1, 1959. The contributions made under this
7subsection (c) shall be considered as survivor's insurance
8contributions for purposes of this Article if the employee is
9covered under the traditional benefit package, and such
10contributions shall be considered as additional contributions
11for purposes of this Article if the employee is participating
12in the self-managed plan or has elected to participate in the
13portable benefit package and has completed the applicable
14one-year waiting period. Contributions in excess of $80 during
15any fiscal year beginning before August 31, 1969 and in excess
16of $120 during any fiscal year thereafter until September 1,
171971 shall be considered as additional contributions for
18purposes of this Article.
19    (c-5) In addition to the contributions otherwise required
20under this Article, each Tier I participant shall also make the
21following contributions toward the retirement benefits payable
22under the retirement program applicable to the employee from
23each payment of earnings applicable to employment under this
24system:
25        (1) beginning July 1, 2013 and through June 30, 2014,
26    1% of earnings; and

 

 

09800SB0001ham001- 205 -LRB098 05457 EFG 45203 a

1        (2) beginning on July 1, 2014, 2% of earnings.
2    Except as otherwise specified, these contributions are to
3be considered as normal contributions for purposes of this
4Article.
5    (d) If the board by board rule so permits and subject to
6such conditions and limitations as may be specified in its
7rules, a participant may make other additional contributions of
8such percentage of earnings or amounts as the participant shall
9elect in a written notice thereof received by the board.
10    (e) That fraction of a participant's total accumulated
11normal contributions, the numerator of which is equal to the
12number of years of service in excess of that which is required
13to qualify for the maximum retirement annuity, and the
14denominator of which is equal to the total service of the
15participant, shall be considered as accumulated additional
16contributions. The determination of the applicable maximum
17annuity and the adjustment in contributions required by this
18provision shall be made as of the date of the participant's
19retirement.
20    (f) Notwithstanding the foregoing, a participating
21employee shall not be required to make contributions under this
22Section after the date upon which continuance of such
23contributions would otherwise cause his or her retirement
24annuity to exceed the maximum retirement annuity as specified
25in clause (1) of subsection (c) of Section 15-136.
26    (g) A participating employee may make contributions for the

 

 

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1purchase of service credit under this Article.
2(Source: P.A. 90-32, eff. 6-27-97; 90-65, eff. 7-7-97; 90-448,
3eff. 8-16-97; 90-511, eff. 8-22-97; 90-576, eff. 3-31-98;
490-655, eff. 7-30-98; 90-766, eff. 8-14-98.)
 
5    (40 ILCS 5/15-157.5 new)
6    Sec. 15-157.5. Use of contributions for health care
7subsidies. The System shall not use any contribution received
8by the System under this Article to provide a subsidy for the
9cost of participation in a retiree health care program.
 
10    (40 ILCS 5/15-165)   (from Ch. 108 1/2, par. 15-165)
11    Sec. 15-165. To certify amounts and submit vouchers.
12    (a) The Board shall certify to the Governor on or before
13November 15 of each year through until November 15, 2011 the
14appropriation required from State funds for the purposes of
15this System for the following fiscal year. The certification
16under this subsection (a) shall include a copy of the actuarial
17recommendations upon which it is based and shall specifically
18identify the System's projected State normal cost for that
19fiscal year and the projected State cost for the self-managed
20plan for that fiscal year.
21    On or before May 1, 2004, the Board shall recalculate and
22recertify to the Governor the amount of the required State
23contribution to the System for State fiscal year 2005, taking
24into account the amounts appropriated to and received by the

 

 

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1System under subsection (d) of Section 7.2 of the General
2Obligation Bond Act.
3    On or before July 1, 2005, the Board shall recalculate and
4recertify to the Governor the amount of the required State
5contribution to the System for State fiscal year 2006, taking
6into account the changes in required State contributions made
7by this amendatory Act of the 94th General Assembly.
8    On or before April 1, 2011, the Board shall recalculate and
9recertify to the Governor the amount of the required State
10contribution to the System for State fiscal year 2011, applying
11the changes made by Public Act 96-889 to the System's assets
12and liabilities as of June 30, 2009 as though Public Act 96-889
13was approved on that date.
14    (a-5) On or before November 1 of each year, beginning
15November 1, 2012, the Board shall submit to the State Actuary,
16the Governor, and the General Assembly a proposed certification
17of the amount of the required State contribution to the System
18for the next fiscal year, along with all of the actuarial
19assumptions, calculations, and data upon which that proposed
20certification is based. On or before January 1 of each year,
21beginning January 1, 2013, the State Actuary shall issue a
22preliminary report concerning the proposed certification and
23identifying, if necessary, recommended changes in actuarial
24assumptions that the Board must consider before finalizing its
25certification of the required State contributions.
26    On or before January 15, 2013 and each January 15

 

 

09800SB0001ham001- 208 -LRB098 05457 EFG 45203 a

1thereafter, the Board shall certify to the Governor and the
2General Assembly the amount of the required State contribution
3for the next fiscal year. The certification shall include a
4copy of the actuarial recommendations upon which it is based
5and shall specifically identify the System's projected State
6normal cost for that fiscal year and the projected State cost
7for the self-managed plan for that fiscal year. The Board's
8certification must note, in a written response to the State
9Actuary, any deviations from the State Actuary's recommended
10changes, the reason or reasons for not following the State
11Actuary's recommended changes, and the fiscal impact of not
12following the State Actuary's recommended changes on the
13required State contribution.
14    (b) The Board shall certify to the State Comptroller or
15employer, as the case may be, from time to time, by its
16president and secretary, with its seal attached, the amounts
17payable to the System from the various funds.
18    (c) Beginning in State fiscal year 1996, on or as soon as
19possible after the 15th day of each month the Board shall
20submit vouchers for payment of State contributions to the
21System, in a total monthly amount of one-twelfth of the
22required annual State contribution certified under subsection
23(a). From the effective date of this amendatory Act of the 93rd
24General Assembly through June 30, 2004, the Board shall not
25submit vouchers for the remainder of fiscal year 2004 in excess
26of the fiscal year 2004 certified contribution amount

 

 

09800SB0001ham001- 209 -LRB098 05457 EFG 45203 a

1determined under this Section after taking into consideration
2the transfer to the System under subsection (b) of Section
36z-61 of the State Finance Act. These vouchers shall be paid by
4the State Comptroller and Treasurer by warrants drawn on the
5funds appropriated to the System for that fiscal year.
6    If in any month the amount remaining unexpended from all
7other appropriations to the System for the applicable fiscal
8year (including the appropriations to the System under Section
98.12 of the State Finance Act and Section 1 of the State
10Pension Funds Continuing Appropriation Act) is less than the
11amount lawfully vouchered under this Section, the difference
12shall be paid from the General Revenue Fund under the
13continuing appropriation authority provided in Section 1.1 of
14the State Pension Funds Continuing Appropriation Act.
15    (d) So long as the payments received are the full amount
16lawfully vouchered under this Section, payments received by the
17System under this Section shall be applied first toward the
18employer contribution to the self-managed plan established
19under Section 15-158.2. Payments shall be applied second toward
20the employer's portion of the normal costs of the System, as
21defined in subsection (f) of Section 15-155. The balance shall
22be applied toward the unfunded actuarial liabilities of the
23System.
24    (e) In the event that the System does not receive, as a
25result of legislative enactment or otherwise, payments
26sufficient to fully fund the employer contribution to the

 

 

09800SB0001ham001- 210 -LRB098 05457 EFG 45203 a

1self-managed plan established under Section 15-158.2 and to
2fully fund that portion of the employer's portion of the normal
3costs of the System, as calculated in accordance with Section
415-155(a-1), then any payments received shall be applied
5proportionately to the optional retirement program established
6under Section 15-158.2 and to the employer's portion of the
7normal costs of the System, as calculated in accordance with
8Section 15-155(a-1).
9(Source: P.A. 96-1497, eff. 1-14-11; 96-1511, eff. 1-27-11;
1097-694, eff. 6-18-12.)
 
11    (40 ILCS 5/15-198)
12    Sec. 15-198. Application and expiration of new benefit
13increases.
14    (a) As used in this Section, "new benefit increase" means
15an increase in the amount of any benefit provided under this
16Article, or an expansion of the conditions of eligibility for
17any benefit under this Article or Article 1, that results from
18an amendment to this Code that takes effect after the effective
19date of this amendatory Act of the 94th General Assembly. "New
20benefit increase", however, does not include any benefit
21increase resulting from the changes made to this Article or
22Article 1 by this amendatory Act of the 98th General Assembly.
23    (b) Notwithstanding any other provision of this Code or any
24subsequent amendment to this Code, every new benefit increase
25is subject to this Section and shall be deemed to be granted

 

 

09800SB0001ham001- 211 -LRB098 05457 EFG 45203 a

1only in conformance with and contingent upon compliance with
2the provisions of this Section.
3    (c) The Public Act enacting a new benefit increase must
4identify and provide for payment to the System of additional
5funding at least sufficient to fund the resulting annual
6increase in cost to the System as it accrues.
7    Every new benefit increase is contingent upon the General
8Assembly providing the additional funding required under this
9subsection. The Commission on Government Forecasting and
10Accountability shall analyze whether adequate additional
11funding has been provided for the new benefit increase and
12shall report its analysis to the Public Pension Division of the
13Department of Financial and Professional Regulation. A new
14benefit increase created by a Public Act that does not include
15the additional funding required under this subsection is null
16and void. If the Public Pension Division determines that the
17additional funding provided for a new benefit increase under
18this subsection is or has become inadequate, it may so certify
19to the Governor and the State Comptroller and, in the absence
20of corrective action by the General Assembly, the new benefit
21increase shall expire at the end of the fiscal year in which
22the certification is made.
23    (d) Every new benefit increase shall expire 5 years after
24its effective date or on such earlier date as may be specified
25in the language enacting the new benefit increase or provided
26under subsection (c). This does not prevent the General

 

 

09800SB0001ham001- 212 -LRB098 05457 EFG 45203 a

1Assembly from extending or re-creating a new benefit increase
2by law.
3    (e) Except as otherwise provided in the language creating
4the new benefit increase, a new benefit increase that expires
5under this Section continues to apply to persons who applied
6and qualified for the affected benefit while the new benefit
7increase was in effect and to the affected beneficiaries and
8alternate payees of such persons, but does not apply to any
9other person, including without limitation a person who
10continues in service after the expiration date and did not
11apply and qualify for the affected benefit while the new
12benefit increase was in effect.
13(Source: P.A. 94-4, eff. 6-1-05.)
 
14    (40 ILCS 5/16-106)  (from Ch. 108 1/2, par. 16-106)
15    Sec. 16-106. Teacher. "Teacher": The following
16individuals, provided that, for employment prior to July 1,
171990, they are employed on a full-time basis, or if not
18full-time, on a permanent and continuous basis in a position in
19which services are expected to be rendered for at least one
20school term:
21        (1) Any educational, administrative, professional or
22    other staff employed in the public common schools included
23    within this system in a position requiring certification
24    under the law governing the certification of teachers;
25        (2) Any educational, administrative, professional or

 

 

09800SB0001ham001- 213 -LRB098 05457 EFG 45203 a

1    other staff employed in any facility of the Department of
2    Children and Family Services or the Department of Human
3    Services, in a position requiring certification under the
4    law governing the certification of teachers, and any person
5    who (i) works in such a position for the Department of
6    Corrections, (ii) was a member of this System on May 31,
7    1987, and (iii) did not elect to become a member of the
8    State Employees' Retirement System pursuant to Section
9    14-108.2 of this Code; except that "teacher" does not
10    include any person who (A) becomes a security employee of
11    the Department of Human Services, as defined in Section
12    14-110, after June 28, 2001 (the effective date of Public
13    Act 92-14), or (B) becomes a member of the State Employees'
14    Retirement System pursuant to Section 14-108.2c of this
15    Code;
16        (3) Any regional superintendent of schools, assistant
17    regional superintendent of schools, State Superintendent
18    of Education; any person employed by the State Board of
19    Education as an executive; any executive of the boards
20    engaged in the service of public common school education in
21    school districts covered under this system of which the
22    State Superintendent of Education is an ex-officio member;
23        (4) Any employee of a school board association
24    operating in compliance with Article 23 of the School Code
25    who is certificated under the law governing the
26    certification of teachers, provided that he or she becomes

 

 

09800SB0001ham001- 214 -LRB098 05457 EFG 45203 a

1    such an employee before the effective date of this
2    amendatory Act of the 98th General Assembly;
3        (5) Any person employed by the retirement system who:
4            (i) was an employee of and a participant in the
5        system on August 17, 2001 (the effective date of Public
6        Act 92-416), or
7            (ii) becomes an employee of the system on or after
8        August 17, 2001;
9        (6) Any educational, administrative, professional or
10    other staff employed by and under the supervision and
11    control of a regional superintendent of schools, provided
12    such employment position requires the person to be
13    certificated under the law governing the certification of
14    teachers and is in an educational program serving 2 or more
15    districts in accordance with a joint agreement authorized
16    by the School Code or by federal legislation;
17        (7) Any educational, administrative, professional or
18    other staff employed in an educational program serving 2 or
19    more school districts in accordance with a joint agreement
20    authorized by the School Code or by federal legislation and
21    in a position requiring certification under the laws
22    governing the certification of teachers;
23        (8) Any officer or employee of a statewide teacher
24    organization or officer of a national teacher organization
25    who is certified under the law governing certification of
26    teachers, provided: (i) the individual had previously

 

 

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1    established creditable service under this Article, (ii)
2    the individual files with the system an irrevocable
3    election to become a member before the effective date of
4    this amendatory Act of the 97th General Assembly, (iii) the
5    individual does not receive credit for such service under
6    any other Article of this Code, and (iv) the individual
7    first became an officer or employee of the teacher
8    organization and becomes a member before the effective date
9    of this amendatory Act of the 97th General Assembly;
10        (9) Any educational, administrative, professional, or
11    other staff employed in a charter school operating in
12    compliance with the Charter Schools Law who is certificated
13    under the law governing the certification of teachers; .
14        (10) Any person employed, on the effective date of this
15    amendatory Act of the 94th General Assembly, by the
16    Macon-Piatt Regional Office of Education in a
17    birth-through-age-three pilot program receiving funds
18    under Section 2-389 of the School Code who is required by
19    the Macon-Piatt Regional Office of Education to hold a
20    teaching certificate, provided that the Macon-Piatt
21    Regional Office of Education makes an election, within 6
22    months after the effective date of this amendatory Act of
23    the 94th General Assembly, to have the person participate
24    in the system. Any service established prior to the
25    effective date of this amendatory Act of the 94th General
26    Assembly for service as an employee of the Macon-Piatt

 

 

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1    Regional Office of Education in a birth-through-age-three
2    pilot program receiving funds under Section 2-389 of the
3    School Code shall be considered service as a teacher if
4    employee and employer contributions have been received by
5    the system and the system has not refunded those
6    contributions.
7    An annuitant receiving a retirement annuity under this
8Article or under Article 17 of this Code who is employed by a
9board of education or other employer as permitted under Section
1016-118 or 16-150.1 is not a "teacher" for purposes of this
11Article. A person who has received a single-sum retirement
12benefit under Section 16-136.4 of this Article is not a
13"teacher" for purposes of this Article.
14(Source: P.A. 97-651, eff. 1-5-12; revised 8-3-12.)
 
15    (40 ILCS 5/16-106.4 new)
16    Sec. 16-106.4. Tier I member. "Tier I member": A member
17under this Article who first became a member or participant
18before January 1, 2011 under any reciprocal retirement system
19or pension fund established under this Code other than a
20retirement system or pension fund established under Article 2,
213, 4, 5, 6, or 18 of this Code.
 
22    (40 ILCS 5/16-106.5 new)
23    Sec. 16-106.5. Tier I retiree. "Tier I retiree": A former
24Tier I member who is receiving a retirement annuity.