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Public Act 91-0927
HB1582 Enrolled LRB9101659EGfg
AN ACT in relation to public employee benefits.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Pension Code is amended by
changing Sections 14-107, 14-108, 14-114, 16-132, 16-133, and
16-133.1 as follows:
(40 ILCS 5/14-107) (from Ch. 108 1/2, par. 14-107)
Sec. 14-107. Retirement annuity - service and age -
conditions. A member is entitled to a retirement annuity
after having at least 8 years of creditable service.
A member who has at least 35 years of creditable service
may claim his or her retirement annuity at any age. A member
having at least 8 years of creditable service but less than
35 may claim his or her retirement annuity upon or after
attainment of age 60 or, beginning January 1, 2001, any
lesser age which, when added to the number of years of his or
her creditable service, equals at least 85. A member upon or
after attainment of age 55 having at least 25 years 30 years
of creditable service (30 years if retirement is before
January 1, 2001) may elect to receive the lower retirement
annuity provided in paragraph (c) of Section 14-108 of this
Code. For purposes of the rule of 85, portions of years
shall be counted in whole months.
The allowance shall begin with the first full calendar
month specified in the member's application therefor, the
first day of which shall not be before the date of withdrawal
as approved by the board. Regardless of the date of
withdrawal, the allowance need not begin within one year of
application therefor.
(Source: P.A. 82-342.)
(40 ILCS 5/14-108) (from Ch. 108 1/2, par. 14-108)
Sec. 14-108. Amount of retirement annuity. A member who
has contributed to the System for at least 12 months shall be
entitled to a prior service annuity for each year of
certified prior service credited to him, except that a member
shall receive 1/3 of the prior service annuity for each year
of service for which contributions have been made and all of
such annuity shall be payable after the member has made
contributions for a period of 3 years. Proportionate amounts
shall be payable for service of less than a full year after
completion of at least 12 months.
The total period of service to be considered in
establishing the measure of prior service annuity shall
include service credited in the Teachers' Retirement System
of the State of Illinois and the State Universities
Retirement System for which contributions have been made by
the member to such systems; provided that at least 1 year of
the total period of 3 years prescribed for the allowance of a
full measure of prior service annuity shall consist of
membership service in this system for which credit has been
granted.
(a) In the case of a member who retires on or after
January 1, 1998 and is a noncovered employee, the retirement
annuity for membership service and prior service shall be
2.2% of final average compensation for each year of service.
Any service credit established as a covered employee shall be
computed as stated in paragraph (b).
(b) In the case of a member who retires on or after
January 1, 1998 and is a covered employee, the retirement
annuity for membership service and prior service shall be
computed as stated in paragraph (a) for all service credit
established as a noncovered employee; for service credit
established as a covered employee it shall be 1.67% of final
average compensation for each year of service.
(c) For a member with 30 but less than 35 years of
creditable service retiring after attaining age 55 but before
age 60 with at least 30 but less than 35 years of creditable
service if retirement is before January 1, 2001, or with at
least 25 but less than 30 years of creditable service if
retirement is on or after January 1, 2001, the retirement
annuity shall be reduced by 1/2 of 1% for each month that the
member's age is under age 60 at the time of retirement.
(d) A retirement annuity shall not exceed 75% of final
average compensation, subject to such extension as may result
from the application of Section 14-114 or Section 14-115.
(e) The retirement annuity payable to any covered
employee who is a member of the System and in service on
January 1, 1969, or in service thereafter in 1969 as a result
of legislation enacted by the Illinois General Assembly
transferring the member to State employment from county
employment in a county Department of Public Aid in counties
of 3,000,000 or more population, under a plan of coordination
with the Old Age, Survivors and Disability provisions
thereof, if not fully insured for Old Age Insurance payments
under the Federal Old Age, Survivors and Disability Insurance
provisions at the date of acceptance of a retirement annuity,
shall not be less than the amount for which the member would
have been eligible if coordination were not applicable.
(f) The retirement annuity payable to any covered
employee who is a member of the System and in service on
January 1, 1969, or in service thereafter in 1969 as a result
of the legislation designated in the immediately preceding
paragraph, if fully insured for Old Age Insurance payments
under the Federal Social Security Act at the date of
acceptance of a retirement annuity, shall not be less than an
amount which when added to the Primary Insurance Benefit
payable to the member upon attainment of age 65 under such
Federal Act, will equal the annuity which would otherwise be
payable if the coordinated plan of coverage were not
applicable.
(g) In the case of a member who is a noncovered
employee, the retirement annuity for membership service as a
security employee of the Department of Corrections or
security employee of the Department of Human Services shall
be 1.9% of final average compensation for each of the first
10 years of service,; 2.1% for each of the next 10 years of
service,; 2.25% for each year of service in excess of 20 but
not exceeding 30,; and 2.5% for each year in excess of 30;
except that the annuity may be calculated under subsection
(a) rather than this subsection (g) if the resulting annuity
is greater.
(h) In the case of a member who is a covered employee,
the retirement annuity for membership service as a security
employee of the Department of Corrections or security
employee of the Department of Human Services shall be 1.67%
of final average compensation for each of the first 10 years
of service,; 1.90% for each of the next 10 years of service,;
2.10% for each year of service in excess of 20 but not
exceeding 30,; and 2.30% for each year in excess of 30.
(i) For the purposes of this Section and Section 14-133
of this Act, the term "security employee of the Department of
Corrections" and the term "security employee of the
Department of Human Services" shall have the meanings
ascribed to them in subsection (c) of Section 14-110.
(j) The retirement annuity computed pursuant to
paragraphs (g) or (h) shall be applicable only to those
security employees of the Department of Corrections and
security employees of the Department of Human Services who
have at least 20 years of membership service and who are not
eligible for the alternative retirement annuity provided
under Section 14-110. However, persons transferring to this
System under Section 14-108.2 who have service credit under
Article 16 of this Code may count such service toward
establishing their eligibility under the 20-year service
requirement of this subsection; but such service may be used
only for establishing such eligibility, and not for the
purpose of increasing or calculating any benefit.
(k) (Blank).
(l) The changes to this Section made by this amendatory
Act of 1997 (changing certain retirement annuity formulas
from a stepped rate to a flat rate) apply to members who
retire on or after January 1, 1998, without regard to whether
employment terminated before the effective date of this
amendatory Act of 1997. An annuity shall not be calculated
in steps by using the new flat rate for some steps and the
superseded stepped rate for other steps of the same type of
service.
(Source: P.A. 89-507, eff. 7-1-97; 90-65, eff. 7-7-97;
90-448, eff. 8-16-97; 90-655, eff. 7-30-98.)
(40 ILCS 5/14-114) (from Ch. 108 1/2, par. 14-114)
Sec. 14-114. Automatic increase in retirement annuity.
(a) Any person receiving a retirement annuity under this
Article who retires having attained age 60, or who retires
before age 60 having at least 35 years of creditable service,
or who retires on or after January 1, 2001 at an age which,
when added to the number of years of his or her creditable
service, equals at least 85, shall, on January 1, next
following the first full year of retirement, have the amount
of the then fixed and payable monthly retirement annuity
increased 3%. Any person receiving a retirement annuity
under this Article who retires before attainment of age 60
and with less than (i) 35 years of creditable service if
retirement is before January 1, 2001, or (ii) the number of
years of creditable service which, when added to the member's
age, would equal 85, if retirement is on or after January 1,
2001, shall have the amount of the fixed and payable
retirement annuity increased by 3% on the January 1 occurring
on or next following (1) attainment of age 60, or (2) the
first anniversary of retirement, whichever occurs later.
However, for persons who receive the alternative retirement
annuity under Section 14-110, references in this subsection
(a) to attainment of age 60 shall be deemed to refer to
attainment of age 55. For a person receiving early
retirement incentives under Section 14-108.3 whose retirement
annuity began after January 1, 1992 pursuant to an extension
granted under subsection (e) of that Section, the first
anniversary of retirement shall be deemed to be January 1,
1993.
On each January 1 following the date of the initial
increase under this subsection, the employee's monthly
retirement annuity shall be increased by an additional 3%.
Beginning January 1, 1990, all automatic annual increases
payable under this Section shall be calculated as a
percentage of the total annuity payable at the time of the
increase, including previous increases granted under this
Article.
(b) The provisions of subsection (a) of this Section
shall be applicable to an employee only if the employee makes
the additional contributions required after December 31, 1969
for the purpose of the automatic increases for not less than
the equivalent of one full year. If an employee becomes an
annuitant before his additional contributions equal one full
year's contributions based on his salary at the date of
retirement, the employee may pay the necessary balance of the
contributions to the system, without interest, and be
eligible for the increasing annuity authorized by this
Section.
(c) The provisions of subsection (a) of this Section
shall not be applicable to any annuitant who is on retirement
on December 31, 1969, and thereafter returns to State
service, unless the member has established at least one year
of additional creditable service following reentry into
service.
(d) In addition to other increases which may be provided
by this Section, on January 1, 1981 any annuitant who was
receiving a retirement annuity on or before January 1, 1971
shall have his retirement annuity then being paid increased
$1 per month for each year of creditable service. On January
1, 1982, any annuitant who began receiving a retirement
annuity on or before January 1, 1977, shall have his
retirement annuity then being paid increased $1 per month for
each year of creditable service.
On January 1, 1987, any annuitant who began receiving a
retirement annuity on or before January 1, 1977, shall have
the monthly retirement annuity increased by an amount equal
to 8¢ per year of creditable service times the number of
years that have elapsed since the annuity began.
(e) Every person who receives the alternative retirement
annuity under Section 14-110 and who is eligible to receive
the 3% increase under subsection (a) on January 1, 1986,
shall also receive on that date a one-time increase in
retirement annuity equal to the difference between (1) his
actual retirement annuity on that date, including any
increases received under subsection (a), and (2) the amount
of retirement annuity he would have received on that date if
the amendments to subsection (a) made by Public Act 84-162
had been in effect since the date of his retirement.
(Source: P.A. 86-273; 87-1265.)
(40 ILCS 5/16-132) (from Ch. 108 1/2, par. 16-132)
Sec. 16-132. Retirement annuity eligibility. A member
who has at least 20 years of creditable service is entitled
to a retirement annuity upon or after attainment of age 55.
A member who has at least 10 but less than 20 years of
creditable service is entitled to a retirement annuity upon
or after attainment of age 60. A member who has at least 5
but less than 10 years of creditable service is entitled to a
retirement annuity upon or after attainment of age 62. A
member who (i) has earned during the period immediately
preceding the last day of service at least one year of
contributing creditable service as an employee of a
department as defined in Section 14-103.04, (ii) has earned
at least 5 years of contributing creditable service as an
employee of a department as defined in Section 14-103.04, and
(iii) retires on or after January 1, 2001 is entitled to a
retirement annuity upon or after attainment of an age which,
when added to the number of years of his or her total
creditable service, equals at least 85. Portions of years
shall be counted as decimal equivalents.
A member who is eligible to receive a retirement annuity
of at least 74.6% of final average salary and will attain age
55 on or before December 31 during the year which commences
on July 1 shall be deemed to attain age 55 on the preceding
June 1.
A member meeting the above eligibility conditions is
entitled to a retirement annuity upon written application to
the board setting forth the date the member wishes the
retirement annuity to commence. However, the effective date
of the retirement annuity shall be no earlier than the day
following the last day of creditable service, regardless of
the date of official termination of employment. To be
eligible for a retirement annuity, a member shall not be
employed as a teacher in the schools included under this
System or under Article 17, unless the member is disabled (in
which event, eligibility for salary must cease), or unless
the System is required by federal law to commence payment due
to the member's age; the changes to this sentence made by
this amendatory Act of 1991 shall apply without regard to
whether the member terminated employment before or after its
effective date.
(Source: P.A. 90-582, eff. 5-27-98.)
(40 ILCS 5/16-133) (from Ch. 108 1/2, par. 16-133)
Sec. 16-133. Retirement annuity; amount.
(a) The amount of the retirement annuity shall be the
larger of the amounts determined under paragraphs (A) and (B)
below:
(A) An amount consisting of the sum of the
following:
(1) An amount that can be provided on an
actuarially equivalent basis by the member's
accumulated contributions at the time of retirement;
and
(2) The sum of (i) the amount that can be
provided on an actuarially equivalent basis by the
member's accumulated contributions representing
service prior to July 1, 1947, and (ii) the amount
that can be provided on an actuarially equivalent
basis by the amount obtained by multiplying 1.4
times the member's accumulated contributions
covering service subsequent to June 30, 1947; and
(3) If there is prior service, 2 times the
amount that would have been determined under
subparagraph (2) of paragraph (A) above on account
of contributions which would have been made during
the period of prior service creditable to the member
had the System been in operation and had the member
made contributions at the contribution rate in
effect prior to July 1, 1947.
(B) An amount consisting of the greater of the
following:
(1) For creditable service earned before July
1, 1998 that has not been augmented under Section
16-129.1: 1.67% of final average salary for each of
the first 10 years of creditable service, 1.90% of
final average salary for each year in excess of 10
but not exceeding 20, 2.10% of final average salary
for each year in excess of 20 but not exceeding 30,
and 2.30% of final average salary for each year in
excess of 30; and
For creditable service earned on or after July
1, 1998 by a member who has at least 24 years of
creditable service on July 1, 1998 and who does not
elect to augment service under Section 16-129.1:
2.2% of final average salary for each year of
creditable service earned on or after July 1, 1998
but before the member reaches a total of 30 years of
creditable service and 2.3% of final average salary
for each year of creditable service earned on or
after July 1, 1998 and after the member reaches a
total of 30 years of creditable service; and
For all other creditable service: 2.2% of
final average salary for each year of creditable
service; or
(2) 1.5% of final average salary for each year
of creditable service plus the sum $7.50 for each of
the first 20 years of creditable service.
The amount of the retirement annuity determined under
this paragraph (B) shall be reduced by 1/2 of 1% for each
month that the member is less than age 60 at the time the
retirement annuity begins. However, this reduction shall
not apply (i) if the member has at least 35 years of
creditable service, or (ii) if the member retires on
account of disability under Section 16-149.2 of this
Article with at least 20 years of creditable service, or
(iii) if the member (1) has earned during the period
immediately preceding the last day of service at least
one year of contributing creditable service as an
employee of a department as defined in Section 14-103.04,
(2) has earned at least 5 years of contributing
creditable service as an employee of a department as
defined in Section 14-103.04, (3) retires on or after
January 1, 2001, and (4) retires having attained an age
which, when added to the number of years of his or her
total creditable service, equals at least 85. Portions
of years shall be counted as decimal equivalents.
(b) For purposes of this Section, final average salary
shall be the average salary for the highest 4 consecutive
years within the last 10 years of creditable service as
determined under rules of the board. The minimum final
average salary shall be considered to be $2,400 per year.
In the determination of final average salary for members
other than elected officials and their appointees when such
appointees are allowed by statute, that part of a member's
salary for any year beginning after June 30, 1979 which
exceeds the member's annual full-time salary rate with the
same employer for the preceding year by more than 20% shall
be excluded. The exclusion shall not apply in any year in
which the member's creditable earnings are less than 50% of
the preceding year's mean salary for downstate teachers as
determined by the survey of school district salaries provided
in Section 2-3.103 of the School Code.
(c) In determining the amount of the retirement annuity
under paragraph (B) of this Section, a fractional year shall
be granted proportional credit.
(d) The retirement annuity determined under paragraph
(B) of this Section shall be available only to members who
render teaching service after July 1, 1947 for which member
contributions are required, and to annuitants who re-enter
under the provisions of Section 16-150.
(e) The maximum retirement annuity provided under
paragraph (B) of this Section shall be 75% of final average
salary.
(f) A member retiring after the effective date of this
amendatory Act of 1998 shall receive a pension equal to 75%
of final average salary if the member is qualified to receive
a retirement annuity equal to at least 74.6% of final average
salary under this Article or as proportional annuities under
Article 20 of this Code.
(Source: P.A. 90-582, eff. 5-27-98; 91-17, eff. 6-4-99;
91-887, eff. 7-6-00.)
(40 ILCS 5/16-133.1) (from Ch. 108 1/2, par. 16-133.1)
Sec. 16-133.1. Automatic annual increase in annuity.
(a) Each member with creditable service and retiring on
or after August 26, 1969 is entitled to the automatic annual
increases in annuity provided under this Section while
receiving a retirement annuity or disability retirement
annuity from the system.
An annuitant shall first be entitled to an initial
increase under this Section on the January 1 next following
the first anniversary of retirement, or January 1 of the year
next following attainment of age 61, whichever is later. At
such time, the system shall pay an initial increase
determined as follows:
(1) 1.5% of the originally granted retirement
annuity or disability retirement annuity multiplied by
the number of years elapsed, if any, from the later of
(1) attainment of age 55, or (2) the date of retirement,
until January 1, 1972, plus
(2) 2% of the originally granted annuity multiplied
by the number of years elapsed, if any, from the date of
retirement or between January 1, 1972, whichever is
later, until and January 1, 1978, plus
(3) 3% of the originally granted annuity multiplied
by the number of years elapsed from the date of
retirement or between January 1, 1978, whichever is
later, until and the effective date of the initial
increase.
However, the initial annual increase calculated under this
Section for the recipient of a disability retirement annuity
granted under Section 16-149.2 shall be reduced by an amount
equal to the total of all increases in that annuity received
under Section 16-149.5 (but not exceeding 100% of the amount
of the initial increase otherwise provided under this
Section).
Following the initial increase, automatic annual
increases in annuity shall be payable on each January 1
thereafter during the lifetime of the annuitant, determined
as a percentage of the originally granted retirement annuity
or disability retirement annuity for increases granted prior
to January 1, 1990, and calculated as a percentage of the
total amount of annuity, including previous increases under
this Section, for increases granted on or after January 1,
1990, as follows: 1.5% for periods prior to January 1, 1972,
2% for periods after December 31, 1971 and prior to January
1, 1978, and 3% for periods after December 31, 1977.
(b) The automatic annual increases in annuity provided
under this Section shall not be applicable unless a member
has made contributions toward such increases for a period
equivalent to one full year of creditable service. If a
member contributes for service performed after August 26,
1969 but the member becomes an annuitant before such
contributions amount to one full year's contributions based
on the salary at the date of retirement, he or she may pay
the necessary balance of the contributions to the system and
be eligible for the automatic annual increases in annuity
provided under this Section.
(c) Each member shall make contributions toward the cost
of the automatic annual increases in annuity as provided
under Section 16-152.
(d) An annuitant receiving a retirement annuity or
disability retirement annuity on July 1, 1969, who
subsequently re-enters service as a teacher is eligible for
the automatic annual increases in annuity provided under this
Section if he or she renders at least one year of creditable
service following the latest re-entry.
(e) In addition to the automatic annual increases in
annuity provided under this Section, an annuitant who meets
the service requirements of this Section and whose retirement
annuity or disability retirement annuity began on or before
January 1, 1971 shall receive, on January 1, 1981, an
increase in the annuity then being paid of one dollar per
month for each year of creditable service. On January 1,
1982, an annuitant whose retirement annuity or disability
retirement annuity began on or before January 1, 1977 shall
receive an increase in the annuity then being paid of one
dollar per month for each year of creditable service.
On January 1, 1987, any annuitant whose retirement
annuity began on or before January 1, 1977, shall receive an
increase in the monthly retirement annuity equal to 8¢ per
year of creditable service times the number of years that
have elapsed since the annuity began.
(Source: P.A. 86-273; 86-1488.)
Section 99. Effective date. This Act takes effect upon
becoming law.
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