Full Text of SB1505 101st General Assembly
SB1505 101ST GENERAL ASSEMBLY |
| | 101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020 SB1505 Introduced 2/15/2019, by Sen. John G. Mulroe SYNOPSIS AS INTRODUCED: |
| 40 ILCS 5/1-160 | | 40 ILCS 5/14-103.41 | | 40 ILCS 5/15-108.1 | | 40 ILCS 5/16-106.41 | |
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Amends the General Provisions, State Employees, and State Universities Articles of the Illinois Pension Code. Provides that for the purposes of determining whether a person is a Tier 1 or Tier 2 member, a person who participated in the Judges Retirement System prior to January 1, 2011 shall be deemed a person who first became a member or participant prior to January 1, 2011 under any retirement system under the State Employees, State Universities, or Downstate Teacher Articles. Makes conforming changes. Effective immediately.
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| | FISCAL NOTE ACT MAY APPLY | | PENSION IMPACT NOTE ACT MAY APPLY |
| | A BILL FOR |
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| | | SB1505 | | LRB101 07437 RPS 52479 b |
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| 1 | | AN ACT concerning public employee benefits.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Pension Code is amended by changing | 5 | | Sections 1-160, 14-103.41, 15-108.1, and 16-106.41 as follows:
| 6 | | (40 ILCS 5/1-160)
| 7 | | Sec. 1-160. Provisions applicable to new hires. | 8 | | (a) The provisions of this Section apply to a person who, | 9 | | on or after January 1, 2011, first becomes a member or a | 10 | | participant under any reciprocal retirement system or pension | 11 | | fund established under this Code, other than a retirement | 12 | | system or pension fund established under Article 2, 3, 4, 5, 6, | 13 | | 15 or 18 of this Code, notwithstanding any other provision of | 14 | | this Code to the contrary, but do not apply to any self-managed | 15 | | plan established under this Code, to any person with respect to | 16 | | service as a sheriff's law enforcement employee under Article | 17 | | 7, or to any participant of the retirement plan established | 18 | | under Section 22-101. Notwithstanding anything to the contrary | 19 | | in this Section, for purposes of this Section, a person who | 20 | | participated in a retirement system under Article 15 prior to | 21 | | January 1, 2011 shall be deemed a person who first became a | 22 | | member or participant prior to January 1, 2011 under any | 23 | | retirement system or pension fund subject to this Section. The |
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| 1 | | changes made to this Section by Public Act 98-596 are a | 2 | | clarification of existing law and are intended to be | 3 | | retroactive to January 1, 2011 (the effective date of Public | 4 | | Act 96-889), notwithstanding the provisions of Section 1-103.1 | 5 | | of this Code. | 6 | | Notwithstanding anything to the contrary in this Section, | 7 | | for purposes of this Section, a person who participated in a | 8 | | retirement system under Article 18 prior to January 1, 2011 | 9 | | shall be deemed a person who first became a member or | 10 | | participant prior to January 1, 2011 under any retirement | 11 | | system under Article 14 or 16. | 12 | | This Section does not apply to a person who first becomes a | 13 | | noncovered employee under Article 14 on or after the | 14 | | implementation date of the plan created under Section 1-161 for | 15 | | that Article, unless that person elects under subsection (b) of | 16 | | Section 1-161 to instead receive the benefits provided under | 17 | | this Section and the applicable provisions of that Article. | 18 | | This Section does not apply to a person who first becomes a | 19 | | member or participant under Article 16 on or after the | 20 | | implementation date of the plan created under Section 1-161 for | 21 | | that Article, unless that person elects under subsection (b) of | 22 | | Section 1-161 to instead receive the benefits provided under | 23 | | this Section and the applicable provisions of that Article. | 24 | | This Section does not apply to a person who elects under | 25 | | subsection (c-5) of Section 1-161 to receive the benefits under | 26 | | Section 1-161. |
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| 1 | | This Section does not apply to a person who first becomes a | 2 | | member or participant of an affected pension fund on or after 6 | 3 | | months after the resolution or ordinance date, as defined in | 4 | | Section 1-162, unless that person elects under subsection (c) | 5 | | of Section 1-162 to receive the benefits provided under this | 6 | | Section and the applicable provisions of the Article under | 7 | | which he or she is a member or participant. | 8 | | (b) "Final average salary" means the average monthly (or | 9 | | annual) salary obtained by dividing the total salary or | 10 | | earnings calculated under the Article applicable to the member | 11 | | or participant during the 96 consecutive months (or 8 | 12 | | consecutive years) of service within the last 120 months (or 10 | 13 | | years) of service in which the total salary or earnings | 14 | | calculated under the applicable Article was the highest by the | 15 | | number of months (or years) of service in that period. For the | 16 | | purposes of a person who first becomes a member or participant | 17 | | of any retirement system or pension fund to which this Section | 18 | | applies on or after January 1, 2011, in this Code, "final | 19 | | average salary" shall be substituted for the following: | 20 | | (1) In Article 7 (except for service as sheriff's law | 21 | | enforcement employees), "final rate of earnings". | 22 | | (2) In Articles 8, 9, 10, 11, and 12, "highest average | 23 | | annual salary for any 4 consecutive years within the last | 24 | | 10 years of service immediately preceding the date of | 25 | | withdrawal". | 26 | | (3) In Article 13, "average final salary". |
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| 1 | | (4) In Article 14, "final average compensation". | 2 | | (5) In Article 17, "average salary". | 3 | | (6) In Section 22-207, "wages or salary received by him | 4 | | at the date of retirement or discharge". | 5 | | (b-5) Beginning on January 1, 2011, for all purposes under | 6 | | this Code (including without limitation the calculation of | 7 | | benefits and employee contributions), the annual earnings, | 8 | | salary, or wages (based on the plan year) of a member or | 9 | | participant to whom this Section applies shall not exceed | 10 | | $106,800; however, that amount shall annually thereafter be | 11 | | increased by the lesser of (i) 3% of that amount, including all | 12 | | previous adjustments, or (ii) one-half the annual unadjusted | 13 | | percentage increase (but not less than zero) in the consumer | 14 | | price index-u
for the 12 months ending with the September | 15 | | preceding each November 1, including all previous adjustments. | 16 | | For the purposes of this Section, "consumer price index-u" | 17 | | means
the index published by the Bureau of Labor Statistics of | 18 | | the United States
Department of Labor that measures the average | 19 | | change in prices of goods and
services purchased by all urban | 20 | | consumers, United States city average, all
items, 1982-84 = | 21 | | 100. The new amount resulting from each annual adjustment
shall | 22 | | be determined by the Public Pension Division of the Department | 23 | | of Insurance and made available to the boards of the retirement | 24 | | systems and pension funds by November 1 of each year. | 25 | | (c) A member or participant is entitled to a retirement
| 26 | | annuity upon written application if he or she has attained age |
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| 1 | | 67 (beginning January 1, 2015, age 65 with respect to service | 2 | | under Article 12 of this Code that is subject to this Section) | 3 | | and has at least 10 years of service credit and is otherwise | 4 | | eligible under the requirements of the applicable Article. | 5 | | A member or participant who has attained age 62 (beginning | 6 | | January 1, 2015, age 60 with respect to service under Article | 7 | | 12 of this Code that is subject to this Section) and has at | 8 | | least 10 years of service credit and is otherwise eligible | 9 | | under the requirements of the applicable Article may elect to | 10 | | receive the lower retirement annuity provided
in subsection (d) | 11 | | of this Section. | 12 | | (c-5) A person who first becomes a member or a participant | 13 | | subject to this Section on or after July 6, 2017 (the effective | 14 | | date of Public Act 100-23), notwithstanding any other provision | 15 | | of this Code to the contrary, is entitled to a retirement | 16 | | annuity under Article 8 or Article 11 upon written application | 17 | | if he or she has attained age 65 and has at least 10 years of | 18 | | service credit and is otherwise eligible under the requirements | 19 | | of Article 8 or Article 11 of this Code, whichever is | 20 | | applicable. | 21 | | (d) The retirement annuity of a member or participant who | 22 | | is retiring after attaining age 62 (beginning January 1, 2015, | 23 | | age 60 with respect to service under Article 12 of this Code | 24 | | that is subject to this Section) with at least 10 years of | 25 | | service credit shall be reduced by one-half
of 1% for each full | 26 | | month that the member's age is under age 67 (beginning January |
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| 1 | | 1, 2015, age 65 with respect to service under Article 12 of | 2 | | this Code that is subject to this Section). | 3 | | (d-5) The retirement annuity payable under Article 8 or | 4 | | Article 11 to an eligible person subject to subsection (c-5) of | 5 | | this Section who is retiring at age 60 with at least 10 years | 6 | | of service credit shall be reduced by one-half of 1% for each | 7 | | full month that the member's age is under age 65. | 8 | | (d-10) Each person who first became a member or participant | 9 | | under Article 8 or Article 11 of this Code on or after January | 10 | | 1, 2011 and prior to the effective date of this amendatory Act | 11 | | of the 100th General Assembly shall make an irrevocable | 12 | | election either: | 13 | | (i) to be eligible for the reduced retirement age | 14 | | provided in subsections (c-5)
and (d-5) of this Section, | 15 | | the eligibility for which is conditioned upon the member or | 16 | | participant agreeing to the increases in employee | 17 | | contributions for age and service annuities provided in | 18 | | subsection (a-5) of Section 8-174 of this Code (for service | 19 | | under Article 8) or subsection (a-5) of Section 11-170 of | 20 | | this Code (for service under Article 11); or | 21 | | (ii) to not agree to item (i) of this subsection | 22 | | (d-10), in which case the member or participant shall | 23 | | continue to be subject to the retirement age provisions in | 24 | | subsections (c) and (d) of this Section and the employee | 25 | | contributions for age and service annuity as provided in | 26 | | subsection (a) of Section 8-174 of this Code (for service |
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| 1 | | under Article 8) or subsection (a) of Section 11-170 of | 2 | | this Code (for service under Article 11). | 3 | | The election provided for in this subsection shall be made | 4 | | between October 1, 2017 and November 15, 2017. A person subject | 5 | | to this subsection who makes the required election shall remain | 6 | | bound by that election. A person subject to this subsection who | 7 | | fails for any reason to make the required election within the | 8 | | time specified in this subsection shall be deemed to have made | 9 | | the election under item (ii). | 10 | | (e) Any retirement annuity or supplemental annuity shall be | 11 | | subject to annual increases on the January 1 occurring either | 12 | | on or after the attainment of age 67 (beginning January 1, | 13 | | 2015, age 65 with respect to service under Article 12 of this | 14 | | Code that is subject to this Section and beginning on the | 15 | | effective date of this amendatory Act of the 100th General | 16 | | Assembly, age 65 with respect to service under Article 8 or | 17 | | Article 11 for eligible persons who: (i) are subject to | 18 | | subsection (c-5) of this Section; or (ii) made the election | 19 | | under item (i) of subsection (d-10) of this Section) or the | 20 | | first anniversary of the annuity start date, whichever is | 21 | | later. Each annual increase shall be calculated at 3% or | 22 | | one-half the annual unadjusted percentage increase (but not | 23 | | less than zero) in the consumer price index-u for the 12 months | 24 | | ending with the September preceding each November 1, whichever | 25 | | is less, of the originally granted retirement annuity. If the | 26 | | annual unadjusted percentage change in the consumer price |
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| 1 | | index-u for the 12 months ending with the September preceding | 2 | | each November 1 is zero or there is a decrease, then the | 3 | | annuity shall not be increased. | 4 | | For the purposes of Section 1-103.1 of this Code, the | 5 | | changes made to this Section by this amendatory Act of the | 6 | | 100th General Assembly are applicable without regard to whether | 7 | | the employee was in active service on or after the effective | 8 | | date of this amendatory Act of the 100th General Assembly. | 9 | | (f) The initial survivor's or widow's annuity of an | 10 | | otherwise eligible survivor or widow of a retired member or | 11 | | participant who first became a member or participant on or | 12 | | after January 1, 2011 shall be in the amount of 66 2/3% of the | 13 | | retired member's or participant's retirement annuity at the | 14 | | date of death. In the case of the death of a member or | 15 | | participant who has not retired and who first became a member | 16 | | or participant on or after January 1, 2011, eligibility for a | 17 | | survivor's or widow's annuity shall be determined by the | 18 | | applicable Article of this Code. The initial benefit shall be | 19 | | 66 2/3% of the earned annuity without a reduction due to age. A | 20 | | child's annuity of an otherwise eligible child shall be in the | 21 | | amount prescribed under each Article if applicable. Any | 22 | | survivor's or widow's annuity shall be increased (1) on each | 23 | | January 1 occurring on or after the commencement of the annuity | 24 | | if
the deceased member died while receiving a retirement | 25 | | annuity or (2) in
other cases, on each January 1 occurring | 26 | | after the first anniversary
of the commencement of the annuity. |
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| 1 | | Each annual increase shall be calculated at 3% or one-half the | 2 | | annual unadjusted percentage increase (but not less than zero) | 3 | | in the consumer price index-u for the 12 months ending with the | 4 | | September preceding each November 1, whichever is less, of the | 5 | | originally granted survivor's annuity. If the annual | 6 | | unadjusted percentage change in the consumer price index-u for | 7 | | the 12 months ending with the September preceding each November | 8 | | 1 is zero or there is a decrease, then the annuity shall not be | 9 | | increased. | 10 | | (g) The benefits in Section 14-110 apply only if the person | 11 | | is a State policeman, a fire fighter in the fire protection | 12 | | service of a department, a security employee of the Department | 13 | | of Corrections or the Department of Juvenile Justice, or a | 14 | | security employee of the Department of Innovation and | 15 | | Technology, as those terms are defined in subsection (b) and | 16 | | subsection (c) of Section 14-110. A person who meets the | 17 | | requirements of this Section is entitled to an annuity | 18 | | calculated under the provisions of Section 14-110, in lieu of | 19 | | the regular or minimum retirement annuity, only if the person | 20 | | has withdrawn from service with not less than 20
years of | 21 | | eligible creditable service and has attained age 60, regardless | 22 | | of whether
the attainment of age 60 occurs while the person is
| 23 | | still in service. | 24 | | (h) If a person who first becomes a member or a participant | 25 | | of a retirement system or pension fund subject to this Section | 26 | | on or after January 1, 2011 is receiving a retirement annuity |
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| 1 | | or retirement pension under that system or fund and becomes a | 2 | | member or participant under any other system or fund created by | 3 | | this Code and is employed on a full-time basis, except for | 4 | | those members or participants exempted from the provisions of | 5 | | this Section under subsection (a) of this Section, then the | 6 | | person's retirement annuity or retirement pension under that | 7 | | system or fund shall be suspended during that employment. Upon | 8 | | termination of that employment, the person's retirement | 9 | | annuity or retirement pension payments shall resume and be | 10 | | recalculated if recalculation is provided for under the | 11 | | applicable Article of this Code. | 12 | | If a person who first becomes a member of a retirement | 13 | | system or pension fund subject to this Section on or after | 14 | | January 1, 2012 and is receiving a retirement annuity or | 15 | | retirement pension under that system or fund and accepts on a | 16 | | contractual basis a position to provide services to a | 17 | | governmental entity from which he or she has retired, then that | 18 | | person's annuity or retirement pension earned as an active | 19 | | employee of the employer shall be suspended during that | 20 | | contractual service. A person receiving an annuity or | 21 | | retirement pension under this Code shall notify the pension | 22 | | fund or retirement system from which he or she is receiving an | 23 | | annuity or retirement pension, as well as his or her | 24 | | contractual employer, of his or her retirement status before | 25 | | accepting contractual employment. A person who fails to submit | 26 | | such notification shall be guilty of a Class A misdemeanor and |
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| 1 | | required to pay a fine of $1,000. Upon termination of that | 2 | | contractual employment, the person's retirement annuity or | 3 | | retirement pension payments shall resume and, if appropriate, | 4 | | be recalculated under the applicable provisions of this Code. | 5 | | (i) (Blank). | 6 | | (j) In the case of a conflict between the provisions of | 7 | | this Section and any other provision of this Code, the | 8 | | provisions of this Section shall control.
| 9 | | (Source: P.A. 100-23, eff. 7-6-17; 100-201, eff. 8-18-17; | 10 | | 100-563, eff. 12-8-17; 100-611, eff. 7-20-18; 100-1166, eff. | 11 | | 1-4-19.) | 12 | | (40 ILCS 5/14-103.41) | 13 | | Sec. 14-103.41. Tier 1 member. "Tier 1 member": A member of | 14 | | this System who first became a member or participant before | 15 | | January 1, 2011 under any reciprocal retirement system or | 16 | | pension fund established under this Code other than a | 17 | | retirement system or pension fund established under Article 2, | 18 | | 3, 4, 5, or 6 , or 18 of this Code.
| 19 | | (Source: P.A. 100-587, eff. 6-4-18.) | 20 | | (40 ILCS 5/15-108.1) | 21 | | Sec. 15-108.1. Tier 1 member. "Tier 1 member": A | 22 | | participant or an annuitant of a retirement annuity under this | 23 | | Article, other than a participant in the self-managed plan | 24 | | under Section 15-158.2, who first became a participant or |
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| 1 | | member before January 1, 2011 under any reciprocal retirement | 2 | | system or pension fund established under this Code, other than | 3 | | a retirement system or pension fund established under Articles | 4 | | 2, 3, 4, 5, or 6 , or 18 of this Code. "Tier 1 member" includes a | 5 | | person who first became a participant under this System before | 6 | | January 1, 2011 and who accepts a refund and is subsequently | 7 | | reemployed by an employer on or after January 1, 2011.
| 8 | | (Source: P.A. 98-92, eff. 7-16-13.) | 9 | | (40 ILCS 5/16-106.41) | 10 | | Sec. 16-106.41. Tier 1 member. "Tier 1 member": A member | 11 | | under this Article who first became a member or participant | 12 | | before January 1, 2011 under any reciprocal retirement system | 13 | | or pension fund established under this Code other than a | 14 | | retirement system or pension fund established under Article 2, | 15 | | 3, 4, 5, or 6 , or 18 of this Code.
| 16 | | (Source: P.A. 100-587, eff. 6-4-18.)
| 17 | | Section 99. Effective date. This Act takes effect upon | 18 | | becoming law.
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