State of Illinois
90th General Assembly
Legislation

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90_SB1906

      40 ILCS 5/7-146           from Ch. 108 1/2, par. 7-146
      40 ILCS 5/7-150           from Ch. 108 1/2, par. 7-150
      40 ILCS 5/7-154           from Ch. 108 1/2, par. 7-154
      40 ILCS 5/7-159           from Ch. 108 1/2, par. 7-159
      40 ILCS 5/7-172           from Ch. 108 1/2, par. 7-172
      40 ILCS 5/7-173.1         from Ch. 108 1/2, par. 7-173.1
      40 ILCS 5/7-173.2         from Ch. 108 1/2, par. 7-173.2
      40 ILCS 5/7-174           from Ch. 108 1/2, par. 7-174
      30 ILCS 805/8.22 new
          Amends the Illinois Municipal Retirement Fund Article  of
      the  Pension Code.  Provides for the payment of an annuity to
      the surviving spouse of a former employee who, on the date of
      death,  meets  the  service  requirements  but  not  the  age
      requirements for receiving a retirement  annuity.   Allows  a
      retiring  employee  who  is entitled to a refund of surviving
      spouse  contributions   or   excess   SLEP   (sheriff's   law
      enforcement  employee)  contributions  to  elect to receive a
      separate annuity instead of a refund.  Provides that  periods
      of  qualified  leave  granted  in compliance with the federal
      Family and Medical Leave Act shall be ignored for purposes of
      determining eligibility for disability benefits.   Allows  an
      employee  to  make  payment of optional contributions through
      tax-deferred payroll deductions.   Adds  a  second  annuitant
      member  to  the  Board  and gives both annuitant trustees the
      right to  vote  on  Board  business.   Makes  other  changes.
      Amends  the  State  Mandates  Act  to  require implementation
      without reimbursement.  Effective immediately.
                                                     LRB9011415EGfg
                                               LRB9011415EGfg
 1        AN ACT to amend the Illinois  Pension  Code  by  changing
 2    Sections 7-146, 7-150, 7-154, 7-159, 7-172, 7-173.1, 7-173.2,
 3    and 7-174 and to amend the State Mandates Act.
 4        Be  it  enacted  by  the People of the State of Illinois,
 5    represented in the General Assembly:
 6        Section 5.  The  Illinois  Pension  Code  is  amended  by
 7    changing Sections 7-146, 7-150, 7-154, 7-159, 7-172, 7-173.1,
 8    7-173.2, and 7-174 as follows:
 9        (40 ILCS 5/7-146) (from Ch. 108 1/2, par. 7-146)
10        Sec. 7-146.  Temporary disability benefits - Eligibility.
11    Temporary   disability   benefits   shall   be   payable   to
12    participating employees as hereinafter provided.
13        (a)  The   participating  employee  shall  be  considered
14    temporarily disabled if:
15        1.  He is unable to perform the duties  of  any  position
16    which  might  reasonably  be assigned to him by his employing
17    municipality  or  instrumentality  thereof  or  participating
18    instrumentality due to mental or physical  disability  caused
19    by  bodily  injury  or  disease,  other  than  as a result of
20    self-inflicted injury or addiction to narcotic drugs;
21        2.  The Board has received written certifications from at
22    least 1 licensed and practicing physician and  the  governing
23    body of the employing municipality or instrumentality thereof
24    or  participating  instrumentality  stating that the employee
25    meets the conditions set forth  in  subparagraph  1  of  this
26    paragraph (a).
27        (b)  A temporary disability benefit shall be payable to a
28    temporarily disabled employee provided:
29        1.  He:
30        (i)  has  at  least  one  1  year  of service immediately
31    preceding at the date the temporary disability  was  incurred
                            -2-                LRB9011415EGfg
 1    and  has  made  contributions  to  the  fund for at least the
 2    number of months of service normally required in his position
 3    during a 12-month period, or has at least 5 years of  service
 4    credit,  the  last  year  of  which immediately precedes such
 5    date; or
 6        (ii)  had qualified under clause (i) above,  but  had  an
 7    interruption   in   service   with   the  same  participating
 8    municipality or participating  instrumentality  of  not  more
 9    than  3  months  in  the  12  months  preceding  the date the
10    temporary  disability  was  incurred  and  was  not  paid   a
11    separation benefit; or
12        (iii)  had  qualified  under clause (i) above, but had an
13    interruption after 20 or more years  of  creditable  service,
14    was  not  paid  a separation benefit, and returned to service
15    prior to the date the disability was incurred.
16        Item  (iii)  of  this  subdivision  shall  apply  to  all
17    employees whose disabilities were incurred on or  after  July
18    1,  1985,  and  any  such employee who becomes eligible for a
19    disability benefit under item  (iii)  shall  be  entitled  to
20    receive  a  lump  sum  payment  of any accumulated disability
21    benefits which may accrue from the date  the  disability  was
22    incurred  until  the effective date of this amendatory Act of
23    1987.
24        Periods of qualified leave granted in compliance with the
25    federal Family and Medical Leave Act  shall  be  ignored  for
26    purposes  of  determining the number of consecutive months of
27    employment under this subdivision (b)1.
28        2.  He has been temporarily  disabled  for  at  least  30
29    days,  except where a former temporary or permanent and total
30    disability has reoccurred within 6 months after the  employee
31    has returned to service.
32        3.  He  is  receiving  no  earnings  from a participating
33    municipality  or  instrumentality  thereof  or  participating
34    instrumentality, except as allowed under  subsection  (f)  of
                            -3-                LRB9011415EGfg
 1    Section 7-152.
 2        4.  He has not refused to submit to a reasonable physical
 3    examination by a physician appointed by the Board.
 4        5.  His  disability  is  not  the  result  of a mental or
 5    physical condition which existed  on  the  earliest  date  of
 6    service  from  which  he has uninterrupted service, including
 7    prior service, at the date of his disability,  provided  that
 8    this  limitation  shall  not be applicable to a participating
 9    employee who: (i) on the date of disability has  5  years  of
10    creditable  service,  exclusive  of  creditable  service  for
11    periods  of disability; or (ii) received no medical treatment
12    for the condition for the 3 years immediately prior  to  such
13    earliest date of service.
14        6.  He   is   not  separated  from  the  service  of  the
15    participating  municipality  or  instrumentality  thereof  or
16    participating instrumentality which employed him on the  date
17    his  temporary  disability  was incurred; for the purposes of
18    payment of temporary  disability  benefits,  a  participating
19    employee,  whose employment relationship is terminated by his
20    employing municipality, shall be deemed not to  be  separated
21    from   the   service   of   his   employing  municipality  or
22    participating instrumentality if he continues disabled by the
23    same condition and so long as he  is  otherwise  entitled  to
24    such disability benefit.
25    (Source: P.A. 86-272; 87-740.)
26        (40 ILCS 5/7-150) (from Ch. 108 1/2, par. 7-150)
27        Sec.  7-150.   Total  and permanent disability benefits -
28    Eligibility. Total and permanent disability benefits shall be
29    payable to participating employees as  hereinafter  provided,
30    including  those  employees  receiving  disability benefit on
31    July 1, 1962.
32        (a)  A participating employee shall be considered totally
33    and permanently disabled if:
                            -4-                LRB9011415EGfg
 1        1.  He is  unable  to  engage  in  any  gainful  activity
 2    because  of  any  medically  determinable  physical or mental
 3    impairment which can be expected to result in death or be  of
 4    a  long  continued  and  indefinite duration, other than as a
 5    result of self-inflicted  injury  or  addiction  to  narcotic
 6    drugs;
 7        2.  The  Board has received a written certification by at
 8    least 1 licensed and practicing physician  stating  that  the
 9    employee  meets  the qualifications of subparagraph 1 of this
10    paragraph (a).
11        (b)  A  totally  and  permanently  disabled  employee  is
12    entitled to a permanent disability benefit provided:
13        1.  He has exhausted his temporary disability benefits.
14        2.  He:
15        (i)  has  at  least  one  year  of  service   immediately
16    preceding  the  date the disability was incurred and has made
17    contributions to the fund for at least the number  of  months
18    of  service  normally  required  in  his position during a 12
19    month period, or has at least 5 years of service credit,  the
20    last   year  of  which  immediately  preceded  the  date  the
21    disability was incurred; or
22        (ii)  had qualified under clause (i) above,  but  had  an
23    interruption   in   service   with   the  same  participating
24    municipality or participating  instrumentality  of  not  more
25    than  3  months  in  the  12  months  preceding  the date the
26    temporary  disability  was  incurred  and  was  not  paid   a
27    separation benefit; or
28        (iii)  had  qualified  under clause (i) above, but had an
29    interruption after 20 or more years  of  creditable  service,
30    was  not  paid  a separation benefit, and returned to service
31    prior to the date the disability was incurred.
32        Item  (iii)  of  this  subdivision  shall  apply  to  all
33    employees whose disabilities were incurred on or  after  July
34    1,  1985,  and  any  such employee who becomes eligible for a
                            -5-                LRB9011415EGfg
 1    disability benefit under item  (iii)  shall  be  entitled  to
 2    receive  a  lump  sum  payment  of any accumulated disability
 3    benefits which may accrue from the date  the  disability  was
 4    incurred  until  the effective date of this amendatory Act of
 5    1987.
 6        Periods of qualified leave granted in compliance with the
 7    federal Family and Medical Leave Act  shall  be  ignored  for
 8    purposes  of  determining the number of consecutive months of
 9    employment under this subdivision (b)2.
10        3.  He is receiving  no  earnings  from  a  participating
11    municipality  or  instrumentality  thereof  or  participating
12    instrumentality,  except  as  allowed under subsection (f) of
13    Section 7-152.
14        4.  He has not refused to submit to a reasonable physical
15    examination by a physician appointed by the Board.
16        5.  His disability is not  the  result  of  a  mental  or
17    physical  condition  which  existed  on  the earliest date of
18    service from which he has  uninterrupted  service,  including
19    prior  service,  at the date of his disability, provided that
20    this limitation shall not be applicable  to  a  participating
21    employee   who,   without  receiving  a  disability  benefit,
22    receives 5 years of creditable service.
23        6.  He is not separated from the service of his employing
24    participating  municipality  or  instrumentality  thereof  or
25    participating  instrumentality  on  the  date  his  temporary
26    disability was incurred; for the purposes of payment of total
27    and permanent disability benefits, a participating  employee,
28    whose  employment relationship is terminated by his employing
29    municipality, shall be deemed not to be  separated  from  the
30    service   of  his  employing  municipality  or  participating
31    instrumentality  if  he  continues  disabled  by   the   same
32    condition  and  so  long  as he is otherwise entitled to such
33    disability benefit.
34        7.  He has not refused to apply for a disability  benefit
                            -6-                LRB9011415EGfg
 1    under  the  Federal Social Security Act at the request of the
 2    Board.
 3        (c)  A participating employee shall remain  eligible  and
 4    may  make  application  for  a total and permanent disability
 5    benefit within 90 days after the termination of his temporary
 6    disability benefits or within such longer period  terminating
 7    at   the  end  of  the  period  during  which  his  employing
 8    municipality is prevented from employing him by reason of any
 9    statutory prohibition.
10    (Source: P.A. 86-272; 87-740.)
11        (40 ILCS 5/7-154) (from Ch. 108 1/2, par. 7-154)
12        Sec. 7-154.  Surviving spouse annuities - Eligibility.
13        (a)  A surviving spouse annuity shall be payable  to  the
14    eligible  surviving  spouse  of  a participating employee, an
15    employee annuitant, or a person who  on  the  date  of  death
16    would  have  been  entitled  to  a retirement annuity, had he
17    applied for such annuity, and who dies at  any  time  when  a
18    surviving  spouse  annuity  equals  at  least  $5  per month,
19    provided:
20             (1)  The surviving spouse (i)  was  married  to  the
21        participating  employee for at least one year on the date
22        of death, or (ii) was married to the annuitant or  person
23        entitled  to  a  retirement annuity for at least one year
24        prior to the date of termination of service, or (iii) was
25        married to the deceased annuitant for at least  one  year
26        on  the date of the deceased annuitant's death, if at the
27        time of termination of service the deceased annuitant was
28        married for at least one year to a spouse  who  does  not
29        survive the deceased annuitant.
30             (2)  The  male  deceased  employee annuitant or such
31        other  person  entitled  to  a  retirement  annuity   had
32        contributed  to  this  fund  for surviving spouse annuity
33        purposes for at least 1 year or  continuously  since  the
                            -7-                LRB9011415EGfg
 1        effective  date  of  the  participating  municipality  or
 2        participating instrumentality.
 3             (3)  The  female deceased employee annuitant or such
 4        other person entitled to  a  retirement  annuity  was  in
 5        service  on  or  after  July  27, 1972, provided that the
 6        annuity shall  not  be  computed  on  the  basis  of  any
 7        retirement annuity effective before that date.
 8             (4)  If  the  employee  dies  before  termination of
 9        service, the employee did not exclude the spouse from any
10        death benefit or surviving  spouse  annuity  pursuant  to
11        subsection  (b)  of  Section  7-118.   A  designation  of
12        beneficiary  naming  a  spouse  and children jointly or a
13        trust pursuant to subsection (b) of Section  7-118  shall
14        preclude payment of a surviving spouse annuity.
15        (b)  If   a   person   is   the   spouse  of  a  retiring
16    participating employee on the date of the initial payment  of
17    a  retirement annuity and is qualified to receive a surviving
18    spouse annuity  upon  the  death  of  the  employee  and  the
19    surviving  spouse  contributions  are  not  refunded  to  the
20    employee, then a surviving spouse annuity shall be payable to
21    that person even if the marriage to the employee is dissolved
22    after that date.
23        (c)  Eligibility   of   a   surviving   spouse  shall  be
24    determined as of the  date  of  death.   Only  one  surviving
25    spouse  annuity  shall be paid on account of the death of any
26    employee.
27        (d)  With respect to surviving spouse benefits, the  term
28    "person entitled to a retirement annuity" means:
29             (1)  in  the  case  of  a person who dies before the
30        effective date of this amendatory Act of 1998,  a  person
31        who, on the date of death, meets both the age and service
32        requirements  for receiving a retirement annuity from the
33        Fund, but was not actually receiving that annuity; and
34             (2)  in the case of a person who dies  on  or  after
                            -8-                LRB9011415EGfg
 1        the  effective  date  of  this  amendatory Act of 1998, a
 2        person who, on the  date  of  death,  meets  the  service
 3        requirements  (but  not necessarily the age requirements)
 4        for receiving a retirement annuity from the Fund, and was
 5        not actually receiving that annuity.
 6    (Source: P.A. 87-740; 87-850.)
 7        (40 ILCS 5/7-159) (from Ch. 108 1/2, par. 7-159)
 8        Sec. 7-159. Surviving spouse annuity - refund of survivor
 9    credits.
10        (a)  Any employee annuitant  who  (1)  upon  the  date  a
11    retirement  annuity  begins  is  not  then married, or (2) is
12    married to a person  who  would  not  qualify  for  surviving
13    spouse  annuity  if the person died on such date, is entitled
14    to a  refund  of  the  survivor  credits  including  interest
15    accumulated   on  the  date  the  annuity  begins,  excluding
16    survivor credits and interest thereon credited during periods
17    of disability, and no  spouse  shall  have  a  right  to  any
18    surviving  spouse  annuity  from  this Fund.  If the employee
19    annuitant reenters service and upon subsequent retirement has
20    a spouse who would qualify for a  surviving  spouse  annuity,
21    the  employee  annuitant  may  pay the fund the amount of the
22    refund plus interest at the effective rate  at  the  date  of
23    payment.    The  payment  shall  qualify  the  spouse  for  a
24    surviving  spouse  annuity  and  the  amount  paid  shall  be
25    considered as survivor contributions.
26        (b)  Instead  of  a  refund  under  subsection  (a),  the
27    retiring employee may elect to  convert  the  amount  of  the
28    refund   into   an   annuity,  payable  separately  from  the
29    retirement  annuity.   If  the  annuitant  dies  before   the
30    guaranteed  amount  has been distributed, the remainder shall
31    be paid in a lump sum to the designated  beneficiary  of  the
32    annuitant.   The  Board  shall adopt any rules neccessary for
33    the implementation of this subsection.
                            -9-                LRB9011415EGfg
 1    (Source: P. A. 77-2121.)
 2        (40 ILCS 5/7-172) (from Ch. 108 1/2, par. 7-172)
 3        Sec.    7-172.     Contributions     by     participating
 4    municipalities and participating instrumentalities.
 5        (a)  Each    participating    municipality    and    each
 6    participating  instrumentality shall make payment to the fund
 7    as follows:
 8             1.  municipality   contributions   in   an    amount
 9        determined by applying the municipality contribution rate
10        to   each  payment  of  earnings  paid  to  each  of  its
11        participating employees;
12             2.  an amount equal to  the  employee  contributions
13        provided  by  paragraphs  (a)  and  (b) of Section 7-173,
14        whether or not the employee contributions are withheld as
15        permitted by that Section;
16             3.  all accounts receivable, together with  interest
17        charged thereon, as provided in Section 7-209;
18             4.  if   it  has  no  participating  employees  with
19        current earnings, an amount payable which, over a  period
20        of 20 years beginning with the year following an award of
21        benefit,  will  amortize,  at the effective rate for that
22        year, any negative balance in  its  municipality  reserve
23        resulting  from  the award.  This amount when established
24        will be payable as a separate contribution whether or not
25        it later has participating employees.
26        (b)  A separate municipality contribution rate  shall  be
27    determined  for  each  calendar  year  for  all participating
28    municipalities together with all  instrumentalities  thereof.
29    The  municipality  contribution  rate shall be determined for
30    participating instrumentalities as if they were participating
31    municipalities.  The municipality contribution rate shall  be
32    the sum of the following percentages:
33             1.  The   percentage   of   earnings   of   all  the
                            -10-               LRB9011415EGfg
 1        participating    employees    of    all     participating
 2        municipalities and participating instrumentalities which,
 3        if  paid over the entire period of their service, will be
 4        sufficient when combined with all employee  contributions
 5        available  for  the  payment  of benefits, to provide all
 6        annuities for participating  employees,  and  the  $3,000
 7        death  benefit  payable  under  Sections 7-158 and 7-164,
 8        such percentage to be known as the normal cost rate.
 9             2.  The percentage of earnings of the  participating
10        employees   of   each   participating   municipality  and
11        participating instrumentalities necessary to  adjust  for
12        the difference between the present value of all benefits,
13        excluding  temporary  and  total and permanent disability
14        and death benefits, to be provided for its  participating
15        employees  and  the  sum  of its accumulated municipality
16        contributions and the accumulated employee  contributions
17        and  the  present  value  of expected future employee and
18        municipality contributions pursuant to subparagraph 1  of
19        this paragraph (b).  This adjustment shall be spread over
20        the  remainder of the period of 40 years (30 years by the
21        year 2006) from the first of the year following the  date
22        of determination.
23             3.  The  percentage of earnings of the participating
24        employees  of  all   municipalities   and   participating
25        instrumentalities  necessary to provide the present value
26        of all  temporary  and  total  and  permanent  disability
27        benefits  granted  during  the most recent year for which
28        information is available.
29             4.  The percentage of earnings of the  participating
30        employees   of   all   participating  municipalities  and
31        participating instrumentalities necessary to provide  the
32        present  value  of  the  net  single  sum  death benefits
33        expected to become payable from the  reserve  established
34        under  Section  7-206 during the year for which this rate
                            -11-               LRB9011415EGfg
 1        is fixed.
 2             5.  The percentage of earnings necessary to meet any
 3        deficiency  arising  in   the   Terminated   Municipality
 4        Reserve.
 5        (c)  A  separate  municipality contribution rate shall be
 6    computed for each participating municipality or participating
 7    instrumentality for its sheriff's law enforcement  employees.
 8        A   separate  municipality  contribution  rate  shall  be
 9    computed for the sheriff's law enforcement employees of  each
10    forest  preserve district that elects to have such employees.
11    For the period from January 1, 1986  to  December  31,  1986,
12    such  rate  shall  be  the forest preserve district's regular
13    rate plus 2%.
14        In the event that the Board determines that there  is  an
15    actuarial  deficiency in the account of any municipality with
16    respect to a person who has elected  to  participate  in  the
17    Fund under Section 3-109.1 of this Code, the Board may adjust
18    the  municipality's  contribution  rate so as to make up that
19    deficiency over such reasonable period of time as  the  Board
20    may determine.
21        (d)  The  Board  may  establish  a  separate municipality
22    contribution  rate  for  all  employees   who   are   program
23    participants   employed   under   the  Federal  Comprehensive
24    Employment  Training  Act  by  all   of   the   participating
25    municipalities  and  instrumentalities.   The  Board may also
26    provide that, in lieu of a  separate  municipality  rate  for
27    these  employees, a portion of the municipality contributions
28    for such program participants shall be refunded or  an  extra
29    charge   assessed   so   that   the  amount  of  municipality
30    contributions retained or received by the fund for  all  CETA
31    program  participants  shall be an amount equal to that which
32    would be provided by the separate  municipality  contribution
33    rate  for  all  such  program participants.  Refunds shall be
34    made to prime sponsors of programs upon submission of a claim
                            -12-               LRB9011415EGfg
 1    therefor and extra charges shall be assessed to participating
 2    municipalities and instrumentalities.   In  establishing  the
 3    municipality  contribution  rate as provided in paragraph (b)
 4    of  this  Section,  the  use  of  a   separate   municipality
 5    contribution rate for program participants or the refund of a
 6    portion  of  the  municipality contributions, as the case may
 7    be, may be considered.
 8        (e)  Computations of municipality contribution rates  for
 9    the  following  calendar  year  shall  be  made  prior to the
10    beginning of each year, from the information available at the
11    time the computations are made, and on  the  assumption  that
12    the   employees   in   each   participating  municipality  or
13    participating instrumentality at such time will  continue  in
14    service  until  the  end  of  such  calendar  year  at  their
15    respective rates of earnings at such time.
16        (f)  Any  municipality  which  is  the recipient of State
17    allocations representing  that  municipality's  contributions
18    for retirement annuity purposes on behalf of its employees as
19    provided  in Section 12-21.16 of the Illinois Public Aid Code
20    shall pay the allocations so received to the Board  for  such
21    purpose.   Estimates  of  State  allocations  to  be received
22    during  any  taxable  year  shall  be   considered   in   the
23    determination  of  the  municipality's tax rate for that year
24    under Section 7-171.   If  a  special  tax  is  levied  under
25    Section  7-171, none of the proceeds may be used to reimburse
26    the municipality for the amount of State allocations received
27    and paid to the Board.  Any multiple-county  or  consolidated
28    health  department which receives contributions from a county
29    under Section 11.2 of "An Act in  relation  to  establishment
30    and   maintenance   of   county  and  multiple-county  health
31    departments",  approved  July  9,  1943,   as   amended,   or
32    distributions  under  Section  3  of the Department of Public
33    Health  Act,  shall   use   these   only   for   municipality
34    contributions by the health department.
                            -13-               LRB9011415EGfg
 1        (g)  Municipality  contributions for the several purposes
 2    specified shall, for township treasurers and employees in the
 3    offices of the township treasurers who  meet  the  qualifying
 4    conditions  for  coverage  hereunder,  be allocated among the
 5    several  school  districts  and  parts  of  school  districts
 6    serviced by such treasurers and employees in  the  proportion
 7    which  the amount of school funds of each district or part of
 8    a district handled by the treasurer bears to the total amount
 9    of all school funds handled by the treasurer.
10        From the funds subject to allocation among districts  and
11    parts  of districts pursuant to the School Code, the trustees
12    shall withhold the proportionate share of the  liability  for
13    municipality  contributions  imposed  upon  such districts by
14    this Section, in respect  to  such  township  treasurers  and
15    employees and remit the same to the Board.
16        The  municipality  contribution  rate  for an educational
17    service center shall initially be the same rate for each year
18    as the regional office of education or school district  which
19    serves  as  its  administrative  agent.   When actuarial data
20    become available, a separate rate  shall  be  established  as
21    provided in subparagraph (i) of this Section.
22        The  municipality  contribution rate for a public agency,
23    other than a vocational education cooperative,  formed  under
24    the  Intergovernmental Cooperation Act shall initially be the
25    average rate for the municipalities which are parties to  the
26    intergovernmental  agreement.   When  actuarial  data  become
27    available,  a  separate rate shall be established as provided
28    in subparagraph (i) of this Section.
29        (h)  Each participating  municipality  and  participating
30    instrumentality  shall  make the contributions in the amounts
31    provided in this Section in the manner prescribed  from  time
32    to  time  by  the  Board  and all such contributions shall be
33    obligations of the  respective  participating  municipalities
34    and   participating  instrumentalities  to  this  fund.   The
                            -14-               LRB9011415EGfg
 1    failure  to  deduct  any  employee  contributions  shall  not
 2    relieve  the  participating  municipality  or   participating
 3    instrumentality  of  its obligation to this fund.  Delinquent
 4    payments of contributions due under this  Section  may,  with
 5    interest,   be   recovered   by   civil  action  against  the
 6    participating      municipalities      or       participating
 7    instrumentalities.   Municipality  contributions,  other than
 8    the amount necessary for employee  contributions  and  Social
 9    Security  contributions,  for periods of service by employees
10    from whose earnings no  deductions  were  made  for  employee
11    contributions to the fund, may be charged to the municipality
12    reserve     for    the    municipality    or    participating
13    instrumentality.
14        (i)  Contributions  by  participating   instrumentalities
15    shall  be  determined  as  provided  herein  except  that the
16    percentage derived under subparagraph 2 of paragraph  (b)  of
17    this  Section, and the amount payable under subparagraph 5 of
18    paragraph  (a)  of  this  Section,  shall  be  based  on   an
19    amortization period of 10 years.
20    (Source: P.A. 90-448, eff. 8-16-97.)
21        (40 ILCS 5/7-173.1) (from Ch. 108 1/2, par. 7-173.1)
22        Sec.  7-173.1.  Additional  contribution by sheriff's law
23    enforcement employees.
24        (a)  Each sheriff's law enforcement employee  shall  make
25    an  additional contribution of 1% of earnings, which shall be
26    considered as normal contributions.  For earnings on or after
27    July 1, 1988, the additional  contribution  shall  be  2%  of
28    earnings.
29        This   additional   contribution  shall  be  payable  for
30    retroactive service periods  which  the  employee  elects  to
31    establish and to periods of authorized leave of absence.
32        (b)  If  the  employee  is  awarded  a retirement annuity
33    under Section 7-142 and not under Section 7-142.1,  then  the
                            -15-               LRB9011415EGfg
 1    additional  contribution required under this Section shall be
 2    refunded with interest or paid as provided in subsection (c).
 3    If the employee  returns  to  a  participating  status  as  a
 4    sheriff's  law  enforcement  employee, the employee may repay
 5    the  amount  refunded  with  interest  and  upon   subsequent
 6    retirement  be  entitled to a recomputation of the retirement
 7    annuity under Section 7-142.1  if  the  total  service  as  a
 8    sheriff's  law enforcement employee meets the requirements of
 9    that Section.
10        (c)  Instead  of  a  refund  under  subsection  (b),  the
11    retiring employee may elect to  convert  the  amount  of  the
12    refund   into   an   annuity,  payable  separately  from  the
13    retirement  annuity.   If  the  annuitant  dies  before   the
14    guaranteed  amount  has been distributed, the remainder shall
15    be paid in a lump sum to the designated  beneficiary  of  the
16    annuitant.   The  Board  shall adopt any rules neccessary for
17    the implementation of this subsection.
18    (Source: P.A. 85-941.)
19        (40 ILCS 5/7-173.2) (from Ch. 108 1/2, par. 7-173.2)
20        Sec. 7-173.2. Pickup of employee contributions.
21        (a)  Until July 1, 1984, each participating  municipality
22    and  each participating instrumentality may elect, for all of
23    its employees, to pick up the employee contributions required
24    by subparagraphs 1 and 3 of subsection (a) of  Section  7-173
25    and,  in  the  case  of  sheriff's law enforcement employees,
26    required by Section 7-173.1.  The pick up may be for employee
27    contributions  on  earnings  received  by   employees   after
28    December   31,   1981   and   shall   be  applicable  to  the
29    contributions on total  earnings  paid  in  any  month.   The
30    decision  to  pick  up  contributions  shall  be  made by the
31    governing body.
32        Beginning  July  1,  1984,  the  pick  up   of   employee
33    contributions shall cease to be optional.  Each participating
                            -16-               LRB9011415EGfg
 1    municipality  and participating instrumentality shall pick up
 2    the employee contributions required by subparagraphs 1 and  3
 3    of  subsection  (a)  of  Section  7-173  and,  in the case of
 4    sheriff's law enforcement employees,  contributions  required
 5    by  Section  7-173.1,  for all compensation earned after such
 6    date.
 7        (b)  Contributions that are picked up shall be treated as
 8    employer contributions in determining tax treatment under the
 9    United  States   Internal   Revenue   Code.    The   employee
10    contribution  shall  be paid from the same source of funds as
11    is used in payment of earnings to the employee and may not be
12    paid from funds raised by the tax levy authorized by  Section
13    7-171.   The  contributions shall be picked up by a reduction
14    in earnings payment  to  employees.   Employee  contributions
15    that  are  picked  up  shall  be considered as earnings under
16    Section 7-114.  The pick up shall not apply to  contributions
17    made  for  additional contributions under subsection (a) 2 of
18    Section 7-173, authorized leave of absence  under  subsection
19    (a)4  of Section 7-139, out-of-state service under subsection
20    (a) 6 of Section 7-139, retroactive service under  subsection
21    (a)  7  of  Section  7-139  or  repayments  of  separation of
22    benefits   under   Section   7-109.    If   a   participating
23    municipality or participating instrumentality fails to report
24    participating  employee  earnings  which  should  have   been
25    reported to the fund and pays the employee the full amount of
26    earnings  including  employee contributions which should have
27    been picked up and forwarded to the fund, then  the  employee
28    shall  make payment of the employee contributions to the fund
29    on  behalf  of  employer  and  such  contributions  shall  be
30    considered as picked up contributions if paid in the year the
31    earnings were received, or by January 31st of  the  following
32    year,  and  are  reflected  as  picked  up  on reports to the
33    Internal Revenue Service.  If they cannot be so reflected, or
34    if received after that date, they shall  not  be  treated  as
                            -17-               LRB9011415EGfg
 1    picked  up  contributions.  Picked  up employee contributions
 2    shall be considered as employee  contributions  in  computing
 3    benefits paid under this Article 7.
 4        (c)  Subject  to  the  requirements  of  federal  law, an
 5    employee may elect to have  the  employer  pick  up  optional
 6    contributions  that  the  employee  has elected to pay to the
 7    Fund, and the contributions so picked up shall be treated  as
 8    employer   contributions  for  the  purposes  of  determining
 9    federal tax treatment.    The  employer  shall  pick  up  the
10    contributions  by  a  reduction  in  the  cash  salary of the
11    employee and shall pay the contributions from the same source
12    of funds that is used to pay earnings to the  employee.   The
13    employee's election to have the optional contributions picked
14    up  is  irrevocable  and  the  optional contributions may not
15    thereafter be prepaid, by direct payment or otherwise.
16    (Source: P.A. 84-812.)
17        (40 ILCS 5/7-174) (from Ch. 108 1/2, par. 7-174)
18        Sec. 7-174.  Board created.
19        (a)  A board of 9 8 members shall constitute a  board  of
20    trustees  authorized  to  carry  out  the  provisions of this
21    Article.  Each trustee shall be a participating employee of a
22    participating municipality or  participating  instrumentality
23    or  an  annuitant of the Fund and no person shall be eligible
24    to become a trustee after January 1, 1979 who does  not  have
25    at least 8 years of creditable service.
26        (b)  The   board  shall  consist  of  representatives  of
27    various groups as follows:
28             1.  4 trustees shall be a chief  executive  officer,
29        chief  finance  officer,  or  other officer, executive or
30        department  head  of  a  participating  municipality   or
31        participating  instrumentality,  and  each  such  trustee
32        shall be designated as an executive trustee.
33             2.  3 trustees shall be employees of a participating
                            -18-               LRB9011415EGfg
 1        municipality  or  participating  instrumentality and each
 2        such trustee shall be designated as an employee trustee.
 3             3.  2 trustees One trustee shall  be  annuitants  an
 4        annuitant  of  the  Fund,  each  of  whom  who  shall  be
 5        designated an the annuitant trustee.
 6        (c)  A  person  elected  as  a trustee shall qualify as a
 7    trustee, after declaration by the board that he has been duly
 8    elected, upon taking and subscribing  to  the  constitutional
 9    oath of office and filing same in the office of the Fund.
10        (d)  The  term of office of each trustee shall begin upon
11    January 1 of the year following  the  year  in  which  he  is
12    elected  and shall continue for a period of 5 years and until
13    a successor has been elected and qualified,  or  until  prior
14    resignation, death, incapacity or disqualification.  However,
15    the additional annuitant trustee added by this amendatory Act
16    of  1998  shall first be elected at an election held within 9
17    months after the effective date of this amendatory Act, for a
18    term commencing on the later of January 1, 1999 or  the  date
19    of election and ending on December 31, 2002.
20        (e)  Any   elected  trustee  (other  than  the  annuitant
21    trustee) shall be disqualified immediately  upon  termination
22    of  employment  with  all  participating  municipalities  and
23    instrumentalities  thereof or upon any change in status which
24    removes any such trustee  from  all  employments  within  the
25    group  he  represents.    An  The  annuitant trustee shall be
26    disqualified upon termination of his or her annuity.
27        (f)  The trustees shall fill any vacancy in the board  by
28    appointment,  for  the  period  until  the  next  election of
29    trustees, or, if the remaining term is less than 2 years, for
30    the remainder of the term, and until his successor  has  been
31    elected and qualified.
32        (g)  Trustees shall serve without compensation, but shall
33    be   reimbursed  for  any  reasonable  expenses  incurred  in
34    attending meetings of the board and in performing  duties  on
                            -19-               LRB9011415EGfg
 1    behalf  of  the  Fund  and  for  the  amount  of any earnings
 2    withheld  by  any  employing  municipality  or  participating
 3    instrumentality because of attendance at any board meeting.
 4        (h)  Each trustee other than the annuitant trustee  shall
 5    be  entitled  to  one  vote on any and all actions before the
 6    board; the annuitant trustee is not entitled to vote  on  any
 7    matter.   At  least  5  least  4  concurring  votes  shall be
 8    necessary for every decision or action by the board at any of
 9    its meetings.  No decision or action shall  become  effective
10    unless  presented and so approved at a regular or duly called
11    special meeting of the board.
12    (Source: P.A. 89-136, eff. 7-14-95.)
13        Section 90.  The State Mandates Act is amended by  adding
14    Section 8.22 as follows:
15        (30 ILCS 805/8.22 new)
16        Sec.  8.22.  Exempt  mandate.  Notwithstanding Sections 6
17    and 8 of this Act, no reimbursement by the State is  required
18    for  the  implementation  of  any  mandate  created  by  this
19    amendatory Act of 1998.
20        Section  99.  Effective date.  This Act takes effect upon
21    becoming law.

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