Rep. Mike Fortner

Filed: 3/19/2013

 

 


 

 


 
09800HB3066ham001LRB098 07778 JDS 43561 a

1
AMENDMENT TO HOUSE BILL 3066

2    AMENDMENT NO. ______. Amend House Bill 3066 by replacing
3everything after the enacting clause with the following:
 
4    "Section 3. The Budget Stabilization Act is amended by
5changing Sections 20 and 25 as follows:
 
6    (30 ILCS 122/20)
7    Sec. 20. Pension Stabilization Fund.
8    (a) The Pension Stabilization Fund is hereby created as a
9special fund in the State treasury. Moneys in the fund shall be
10used for the sole purpose of making payments to the designated
11retirement systems as provided in Section 25.
12    (b) For each fiscal year when the General Assembly's
13appropriations and transfers or diversions as required by law
14from general funds do not exceed 99% of the estimated general
15funds revenues pursuant to subsection (a) of Section 10, the
16Comptroller shall transfer from the General Revenue Fund as

 

 

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1provided by this Section a total amount equal to 0.5% of the
2estimated general funds revenues to the Pension Stabilization
3Fund.
4    (c) For each fiscal year through Fiscal Year 2013, when the
5General Assembly's appropriations and transfers or diversions
6as required by law from general funds do not exceed 98% of the
7estimated general funds revenues pursuant to subsection (b) of
8Section 10, the Comptroller shall transfer from the General
9Revenue Fund as provided by this Section a total amount equal
10to 1.0% of the estimated general funds revenues to the Pension
11Stabilization Fund.
12    (c-5) In Fiscal Year 2014, the State Comptroller shall
13order transferred and the State Treasurer shall transfer
14$4,100,000,000 from the General Revenue Fund to the Pension
15Stabilization Fund. In each fiscal year thereafter, the State
16Comptroller shall order transferred and the State Treasurer
17shall transfer from the General Revenue Fund to the Pension
18Stabilization Fund the amount transferred under this
19subsection (c-5) in the previous fiscal year increased by
202.25%.
21    (c-10) In addition, in Fiscal Year 2016 and each fiscal
22year thereafter, the State Comptroller shall order transferred
23and the State Treasurer shall transfer $693,500,000 from the
24General Revenue Fund to the Pension Stabilization Fund.
25    (c-15) In addition, in Fiscal Year 2020 and each fiscal
26year thereafter, the State Comptroller shall order transferred

 

 

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1and the State Treasurer shall transfer $900,000,000 from the
2General Revenue Fund to the Pension Stabilization Fund.
3    (c-20) In addition, in Fiscal Year 2034 and each fiscal
4year thereafter, the State Comptroller shall order transferred
5and the State Treasurer shall transfer $1,100,000,000 from the
6General Revenue Fund to the Pension Stabilization Fund.
7    (c-25) The transfers made pursuant to subsections (c-5)
8through (c-20) of this Section shall continue until Fiscal Year
92045 or until each of the designated retirement systems, as
10defined in Section 25, has achieved a funding ratio of at least
11100%, whichever occurs first.
12    (d) The Comptroller shall transfer 1/12 of the total amount
13to be transferred each fiscal year under this Section into the
14Pension Stabilization Fund on the first day of each month of
15that fiscal year or as soon thereafter as possible; except that
16the final transfer of the fiscal year shall be made as soon as
17practical after the August 31 following the end of the fiscal
18year.
19    Until Fiscal Year 2014, before Before the final transfer
20for a fiscal year is made, the Comptroller shall reconcile the
21estimated general funds revenues used in calculating the other
22transfers under this Section for that fiscal year with the
23actual general funds revenues for that fiscal year. The final
24transfer for the fiscal year shall be adjusted so that the
25total amount transferred under this Section for that fiscal
26year is equal to the percentage specified in subsection (b) or

 

 

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1(c) of this Section, whichever is applicable, of the actual
2general funds revenues for that fiscal year. The actual general
3funds revenues for the fiscal year shall be calculated in a
4manner consistent with subsection (c) of Section 10 of this
5Act.
6(Source: P.A. 94-839, eff. 6-6-06.)
 
7    (30 ILCS 122/25)
8    Sec. 25. Transfers from the Pension Stabilization Fund.
9    (a) As used in this Section, "designated retirement
10systems" means:
11        (1) the State Employees' Retirement System of
12    Illinois;
13        (2) (blank) the Teachers' Retirement System of the
14    State of Illinois;
15        (3) the Illinois Teachers' Retirement Fund State
16    Universities Retirement System;
17        (4) the Judges Retirement System of Illinois; and
18        (5) the General Assembly Retirement System.
19    (b) As soon as may be practical after any money is
20deposited into the Pension Stabilization Fund, the State
21Comptroller shall apportion the deposited amount among the
22designated retirement systems and the State Comptroller and
23State Treasurer shall pay the apportioned amounts to the
24designated retirement systems. The amount deposited shall be
25apportioned among the designated retirement systems in

 

 

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1proportion to their respective certified State contributions
2for the State fiscal year in which the payment is made to those
3systems in the same proportion as their respective portions of
4the total actuarial reserve deficiency of the designated
5retirement systems, as most recently determined by the
6Governor's Office of Management and Budget. Amounts received by
7a designated retirement system under this Section shall be used
8for funding the unfunded liabilities of the retirement system.
9Payments under this Section are authorized by the continuing
10appropriation under Section 1.7 of the State Pension Funds
11Continuing Appropriation Act. The total amount transferred to
12the designated retirement systems in Fiscal Year 2014 shall not
13be less than $4,100,000,000. In each Fiscal Year thereafter,
14the total amount transferred to the designated retirement
15systems shall not be less than the total amount transferred in
16the previous fiscal year.
17    (c) At the request of the State Comptroller, the Governor's
18Office of Management and Budget shall determine the individual
19and total actuarial reserve deficiencies of the designated
20retirement systems. For this purpose, the Governor's Office of
21Management and Budget shall consider the latest available audit
22and actuarial reports of each of the retirement systems and the
23relevant reports and statistics of the Public Pension Division
24of the Department of Financial and Professional Regulation.
25    (d) Payments to the designated retirement systems under
26this Section shall be in addition to, and not in lieu of, any

 

 

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1State contributions required under Section 2-124, 14-131,
215-155, 16-158, or 18-131 of the Illinois Pension Code.
3(Source: P.A. 94-839, eff. 6-6-06.)
 
4    Section 5. The Illinois Pension Code is amended by changing
5Sections 15-101, 15-103, 15-111, 15-155, 15-157, 15-158.2,
616-101, and 17-101 and adding Sections 15-112.1, 15-155.1,
715-159.1, and 15-165.1 as follows:
 
8    (40 ILCS 5/15-101)  (from Ch. 108 1/2, par. 15-101)
9    Sec. 15-101. Creation of system.
10    (a) Until July 1, 2013, a A retirement system is created to
11provide retirement annuities and other benefits for employees,
12as defined in this Article, and their dependents.
13    The system shall be known and may be cited as State
14Universities Retirement System. All the business of the system
15shall be transacted in that name.
16    (b) On July 1, 2013, the retirement system established
17under this Article is merged and consolidated with the Article
1816 and 17 retirement systems into a single retirement fund, to
19be known as the Illinois Teachers' Retirement Fund, which shall
20be established and administered as prescribed in this Article.
21    (c) In preparation for that consolidation, the Board of
22this System shall cooperate with the boards of trustees of the
23Article 16 and 17 retirement systems.
24    (d) At the time of consolidation, or as otherwise directed

 

 

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1by the Board of the Illinois Teachers' Retirement Fund, all
2assets and liabilities belonging to the System established
3under this Article shall become the assets and liabilities of
4the Illinois Teachers' Retirement Fund, and all current or
5former members and beneficiaries of the System established
6under this Article shall be deemed current or former
7participants and beneficiaries of the Illinois Teachers'
8Retirement Fund.
9    (e) The Illinois Teachers' Retirement Fund shall be the
10legal successor to the System established under this Article
11and it may exercise any of the rights and powers and perform
12any of the duties of that System. The Illinois Teachers'
13Retirement Fund may, in its discretion, either continue,
14renegotiate, or terminate any personnel, service contract,
15lease, or other contract of any of the retirement systems
16consolidated under this Article.
17    (f) The consolidation of the System established under this
18Article shall not diminish or impair the benefits of any person
19who participated in that System, or of any such person's
20surviving spouse, children, or other dependents.
21    Benefits already payable by the System on June 30, 2013
22shall become payable from the Illinois Teachers' Retirement
23Fund beginning on July 1, 2013, and shall not be subject to
24recalculation or combination due to the consolidation.
25    Benefits that first become payable on or after July 1, 2013
26shall be calculated and paid as provided in this Article 15.

 

 

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1    The consolidation of the System established under this
2Article does not entitle any person to a recalculation of any
3benefit previously granted or a refund of any contribution
4previously paid.
5(Source: P.A. 83-1440.)
 
6    (40 ILCS 5/15-103)  (from Ch. 108 1/2, par. 15-103)
7    Sec. 15-103. System. "System": Until July 1, 2013, the The
8State Universities Retirement System.
9    Beginning July 1, 2013, "system" or "fund" means the
10Illinois Teachers' Retirement Fund created under this Article
11to consolidate the retirement systems previously established
12under this Article and Articles 16 and 17 of this Code;
13depending on the context, the terms may include one or more of
14those previously established retirement systems.
15(Source: P.A. 83-1440.)
 
16    (40 ILCS 5/15-111)  (from Ch. 108 1/2, par. 15-111)
17    Sec. 15-111. Earnings. "Earnings": An amount paid for
18personal services equal to the sum of the basic compensation
19plus extra compensation for summer teaching, overtime or other
20extra service. For periods for which an employee receives
21service credit under subsection (c) of Section 15-113.1 or
22Section 15-113.2, earnings are equal to the basic compensation
23on which contributions are paid by the employee during such
24periods. Compensation for employment which is irregular,

 

 

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1intermittent and temporary shall not be considered earnings,
2unless the participant is also receiving earnings from the
3employer as an employee under Section 15-107.
4    With respect to transition pay paid by the University of
5Illinois to a person who was a participating employee employed
6in the fire department of the University of Illinois's
7Champaign-Urbana campus immediately prior to the elimination
8of that fire department:
9        (1) "Earnings" includes transition pay paid to the
10    employee on or after the effective date of this amendatory
11    Act of the 91st General Assembly.
12        (2) "Earnings" includes transition pay paid to the
13    employee before the effective date of this amendatory Act
14    of the 91st General Assembly only if (i) employee
15    contributions under Section 15-157 have been withheld from
16    that transition pay or (ii) the employee pays to the System
17    before January 1, 2001 an amount representing employee
18    contributions under Section 15-157 on that transition pay.
19    Employee contributions under item (ii) may be paid in a
20    lump sum, by withholding from additional transition pay
21    accruing before January 1, 2001, or in any other manner
22    approved by the System. Upon payment of the employee
23    contributions on transition pay, the corresponding
24    employer contributions become an obligation of the State.
25    Notwithstanding any other provision of this Section,
26"earnings", except as used in Section 15-158.2, does not

 

 

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1include any future increase in income due to a provision in a
2collectively bargained contract that grants an increase in
3earnings based on an employee's expected date of retirement.
4The changes made to this Section by this amendatory Act of the
598th General Assembly do not apply to an employee who is
6covered by a collective bargaining agreement or employment
7contract that is in effect on the effective date of this
8amendatory Act of the 98th General Assembly and that provides
9for such increases, until that agreement or contract expires or
10is amended or renewed.
11(Source: P.A. 91-887, eff. 7-6-00.)
 
12    (40 ILCS 5/15-112.1 new)
13    Sec. 15-112.1. Limitation on earnings and required
14participation in the self-managed plan.
15    (a) For the purpose of calculating traditional benefit
16package benefits and contributions, the annual earnings,
17salary, or wages of a participant shall not exceed the greater
18of (i) the amount specified under subsection (b-5) of Section
191-160 or (ii) the annual earnings of the participant during the
20365 days immediately before the effective date of this Section.
21If, however, an employment contract that is in place on or
22before the effective date of this Section authorizes an
23increase in earnings, salary, or wages on or after the
24effective date of this Section, then the annual earnings,
25salary, or wages of the participant during the 365 days that

 

 

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1immediately precede the date that the contract expires may be
2used in lieu of the amount specified in item (ii) of this
3Section.
4    (b) Notwithstanding any other provision of this Code, (i)
5for a participant who does not make an election under Section
615-134.5, any portion of his or her earnings that exceeds the
7limit specified in subsection (a) of this Section for that year
8shall be subject to the self-managed plan and (ii) for a
9participant who makes an election under Section 15-134.5, the
10entirety of the participant's earnings shall, after the date of
11the election, be subject to the self-managed plan created under
12this Section, as is provided in Section 15-158.2.
 
13    (40 ILCS 5/15-155)  (from Ch. 108 1/2, par. 15-155)
14    Sec. 15-155. Employer contributions.
15    (a) The State of Illinois shall make contributions by
16appropriations of amounts which, together with the other
17employer contributions from trust, federal, and other funds,
18employee contributions, income from investments, and other
19income of this System, will be sufficient to meet the cost of
20maintaining and administering the System on a 100% 90% funded
21basis in accordance with actuarial recommendations.
22    The Board shall determine the amount of State contributions
23required for each fiscal year on the basis of the actuarial
24tables and other assumptions adopted by the Board and the
25recommendations of the actuary, using the formula in subsection

 

 

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1(a-1).
2    (a-1) For State fiscal years 2012 and 2013 through 2045,
3the minimum contribution to the System to be made by the State
4for each fiscal year shall be an amount determined by the
5System to be sufficient to bring the total assets of the System
6up to 90% of the total actuarial liabilities of the System by
7the end of State fiscal year 2045. In making these
8determinations, the required State contribution shall be
9calculated each year as a level percentage of payroll over the
10years remaining to and including fiscal year 2045 and shall be
11determined under the projected unit credit actuarial cost
12method.
13    Beginning July 1, 2013, the assets and liabilities of the
14Article 16 and 17 retirement systems shall be calculated as
15assets and liabilities of the Illinois Teachers' Retirement
16Fund under this Article.
17    For State fiscal years 2014 through 2045 or until the State
18has amortized 100% of the total cost of benefits accrued by
19July 1, 2013, whichever is earlier, in addition to any employer
20contributions required from the State as an employer, the
21minimum contribution to the Fund to be made by the State for
22each fiscal year shall be an amount determined by the Board to
23be sufficient to amortize, by the end of State fiscal year
242045, the total cost of the benefits of the Fund arising before
25July 1, 2013. In making these determinations, the required
26State contribution shall be calculated each year as a level

 

 

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1percentage of payroll over the years remaining to and including
2fiscal year 2045 and shall be determined under the projected
3unit credit actuarial cost method.
4    Beginning with State fiscal year 2014, the minimum required
5contribution of employers under this Article shall be
6determined as a percentage of projected payroll, and shall be
7sufficient to produce an annual amount equal to the employer's
8normal cost for that fiscal year and any unfunded accrued
9liability assigned to the employer that year arising from
10benefits accrued after July 1,2013.
11    For use in determining the employer's contribution for
12unfunded accrued liability the Fund shall maintain a separate
13account for each employer. The separate account shall be
14maintained in such form and detail as the Fund determines to be
15appropriate. The separate account shall reflect the following
16items to the extent that they are attributable to that employer
17and arise on or after July 1, 2013: employer contributions,
18employee contributions, investment returns, payments of
19benefits, and that employer's proportionate share of the Fund's
20administrative expenses. In the event that the Board determines
21that there is a deficiency or surplus in the account of an
22employer, the Board shall determine the employer's
23contribution rate so as to address that deficiency or surplus
24over a reasonable period of time as determined by the Board,
25which shall be no more than 10 years.
26    The State shall also be required to make an annual

 

 

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1contribution to each employer of a member who would have been
2considered a member of Article 15 or 16 before the effective
3date of this amendatory Act of the 98th General Assembly of the
4total employer normal cost as determined by the system for
5FY14. Every 5 years the Commission on Government Forecasting
6and Accountability shall review the contribution in this
7paragraph and the total current employer normal cost and submit
8the findings to the General Assembly.
9    For State fiscal years 1996 through 2005, the State
10contribution to the System, as a percentage of the applicable
11employee payroll, shall be increased in equal annual increments
12so that by State fiscal year 2011, the State is contributing at
13the rate required under this Section.
14    Notwithstanding any other provision of this Article, the
15total required State contribution for State fiscal year 2006 is
16$166,641,900.
17    Notwithstanding any other provision of this Article, the
18total required State contribution for State fiscal year 2007 is
19$252,064,100.
20    For each of State fiscal years 2008 through 2009, the State
21contribution to the System, as a percentage of the applicable
22employee payroll, shall be increased in equal annual increments
23from the required State contribution for State fiscal year
242007, so that by State fiscal year 2011, the State is
25contributing at the rate otherwise required under this Section.
26    Notwithstanding any other provision of this Article, the

 

 

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1total required State contribution for State fiscal year 2010 is
2$702,514,000 and shall be made from the State Pensions Fund and
3proceeds of bonds sold in fiscal year 2010 pursuant to Section
47.2 of the General Obligation Bond Act, less (i) the pro rata
5share of bond sale expenses determined by the System's share of
6total bond proceeds, (ii) any amounts received from the General
7Revenue Fund in fiscal year 2010, (iii) any reduction in bond
8proceeds due to the issuance of discounted bonds, if
9applicable.
10    Notwithstanding any other provision of this Article, the
11total required State contribution for State fiscal year 2011 is
12the amount recertified by the System on or before April 1, 2011
13pursuant to Section 15-165 and shall be made from the State
14Pensions Fund and proceeds of bonds sold in fiscal year 2011
15pursuant to Section 7.2 of the General Obligation Bond Act,
16less (i) the pro rata share of bond sale expenses determined by
17the System's share of total bond proceeds, (ii) any amounts
18received from the General Revenue Fund in fiscal year 2011, and
19(iii) any reduction in bond proceeds due to the issuance of
20discounted bonds, if applicable.
21    Beginning in State fiscal year 2046, the minimum State
22contribution for each fiscal year shall be the amount needed to
23maintain the total assets of the System at 100% 90% of the
24total actuarial liabilities of the System.
25    Amounts received by the System pursuant to Section 25 of
26the Budget Stabilization Act or Section 8.12 of the State

 

 

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1Finance Act in any fiscal year do not reduce and do not
2constitute payment of any portion of the minimum State
3contribution required under this Article in that fiscal year.
4Such amounts shall not reduce, and shall not be included in the
5calculation of, the required State contributions under this
6Article in any future year until the System has reached a
7funding ratio of at least 90%. A reference in this Article to
8the "required State contribution" or any substantially similar
9term does not include or apply to any amounts payable to the
10System under Section 25 of the Budget Stabilization Act.
11    Notwithstanding any other provision of this Section, the
12required State contribution for State fiscal year 2005 and for
13fiscal year 2008 and each fiscal year thereafter, as calculated
14under this Section and certified under Section 15-165, shall
15not exceed an amount equal to (i) the amount of the required
16State contribution that would have been calculated under this
17Section for that fiscal year if the System had not received any
18payments under subsection (d) of Section 7.2 of the General
19Obligation Bond Act, minus (ii) the portion of the State's
20total debt service payments for that fiscal year on the bonds
21issued in fiscal year 2003 for the purposes of that Section
227.2, as determined and certified by the Comptroller, that is
23the same as the System's portion of the total moneys
24distributed under subsection (d) of Section 7.2 of the General
25Obligation Bond Act. In determining this maximum for State
26fiscal years 2008 through 2010, however, the amount referred to

 

 

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1in item (i) shall be increased, as a percentage of the
2applicable employee payroll, in equal increments calculated
3from the sum of the required State contribution for State
4fiscal year 2007 plus the applicable portion of the State's
5total debt service payments for fiscal year 2007 on the bonds
6issued in fiscal year 2003 for the purposes of Section 7.2 of
7the General Obligation Bond Act, so that, by State fiscal year
82011, the State is contributing at the rate otherwise required
9under this Section.
10    (a-5) Pursuant to Article XIII of the 1970 Constitution of
11the State of Illinois, beginning on July 1, 2013, the State
12shall, as a retirement benefit to each participant and
13annuitant of the System be contractually obligated to the
14System (as a fiduciary and trustee of the participants and
15annuitants) to pay the Annual Required State Contribution, as
16determined by the Board of the System using generally accepted
17actuarial principles, as is necessary to bring the total assets
18of the System up to 100% of the total actuarial liabilities of
19the System by the end of State fiscal year 2045. As a further
20retirement benefit and contractual obligation, each fiscal
21year, the State shall pay to each designated retirement system
22the Annual Required State Contribution certified by the Board
23for that fiscal year. Payments of the Annual Required State
24Contribution for each fiscal year shall be made in equal
25monthly installments. This Section, and the security it
26provides to participants and annuitants is intended to be, and

 

 

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1is, a contractual right that is part of the pension benefits
2provided to the participants and annuitants. Notwithstanding
3anything to the contrary in the Court of Claims Act or any
4other law, a designated retirement system has the exclusive
5right to and shall bring a Mandamus action in the Circuit Court
6of Champaign County against the State to compel the State to
7make any installment of the Annual Required State Contribution
8required by this Section, irrespective of other remedies that
9may be available to the System. Each member or annuitant of the
10System has the right to bring a Mandamus action against the
11System in the Circuit Court in any judicial district in which
12the System maintains an office if the System fails to bring an
13action specified in this Section, irrespective of other
14remedies that may be available to the member or annuitant.
15    (b) If an employee is paid from trust or federal funds, the
16employer shall pay to the Board contributions from those funds
17which are sufficient to cover the accruing normal costs on
18behalf of the employee. However, universities having employees
19who are compensated out of local auxiliary funds, income funds,
20or service enterprise funds are not required to pay such
21contributions on behalf of those employees. The local auxiliary
22funds, income funds, and service enterprise funds of
23universities shall not be considered trust funds for the
24purpose of this Article, but funds of alumni associations,
25foundations, and athletic associations which are affiliated
26with the universities included as employers under this Article

 

 

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

 

 

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

 

 

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1System, the present value of the increase in benefits resulting
2from the portion of the increase in earnings that is in excess
3of 6%. This present value shall be computed by the System on
4the basis of the actuarial assumptions and tables used in the
5most recent actuarial valuation of the System that is available
6at the time of the computation. The System may require the
7employer to provide any pertinent information or
8documentation.
9    Whenever it determines that a payment is or may be required
10under this subsection (g), the System shall calculate the
11amount of the payment and bill the employer for that amount.
12The bill shall specify the calculations used to determine the
13amount due. If the employer disputes the amount of the bill, it
14may, within 30 days after receipt of the bill, apply to the
15System in writing for a recalculation. The application must
16specify in detail the grounds of the dispute and, if the
17employer asserts that the calculation is subject to subsection
18(h) or (i) of this Section, must include an affidavit setting
19forth and attesting to all facts within the employer's
20knowledge that are pertinent to the applicability of subsection
21(h) or (i). Upon receiving a timely application for
22recalculation, the System shall review the application and, if
23appropriate, recalculate the amount due.
24    The employer contributions required under this subsection
25(g) (f) may be paid in the form of a lump sum within 90 days
26after receipt of the bill. If the employer contributions are

 

 

09800HB3066ham001- 22 -LRB098 07778 JDS 43561 a

1not paid within 90 days after receipt of the bill, then
2interest will be charged at a rate equal to the System's annual
3actuarially assumed rate of return on investment compounded
4annually from the 91st day after receipt of the bill. Payments
5must be concluded within 3 years after the employer's receipt
6of the bill.
7    (h) This subsection (h) applies only to payments made or
8salary increases given on or after June 1, 2005 but before July
91, 2011. The changes made by Public Act 94-1057 shall not
10require the System to refund any payments received before July
1131, 2006 (the effective date of Public Act 94-1057).
12    When assessing payment for any amount due under subsection
13(g), the System shall exclude earnings increases paid to
14participants under contracts or collective bargaining
15agreements entered into, amended, or renewed before June 1,
162005.
17    When assessing payment for any amount due under subsection
18(g), the System shall exclude earnings increases paid to a
19participant at a time when the participant is 10 or more years
20from retirement eligibility under Section 15-135.
21    When assessing payment for any amount due under subsection
22(g), the System shall exclude earnings increases resulting from
23overload work, including a contract for summer teaching, or
24overtime when the employer has certified to the System, and the
25System has approved the certification, that: (i) in the case of
26overloads (A) the overload work is for the sole purpose of

 

 

09800HB3066ham001- 23 -LRB098 07778 JDS 43561 a

1academic instruction in excess of the standard number of
2instruction hours for a full-time employee occurring during the
3academic year that the overload is paid and (B) the earnings
4increases are equal to or less than the rate of pay for
5academic instruction computed using the participant's current
6salary rate and work schedule; and (ii) in the case of
7overtime, the overtime was necessary for the educational
8mission.
9    When assessing payment for any amount due under subsection
10(g), the System shall exclude any earnings increase resulting
11from (i) a promotion for which the employee moves from one
12classification to a higher classification under the State
13Universities Civil Service System, (ii) a promotion in academic
14rank for a tenured or tenure-track faculty position, or (iii) a
15promotion that the Illinois Community College Board has
16recommended in accordance with subsection (k) of this Section.
17These earnings increases shall be excluded only if the
18promotion is to a position that has existed and been filled by
19a member for no less than one complete academic year and the
20earnings increase as a result of the promotion is an increase
21that results in an amount no greater than the average salary
22paid for other similar positions.
23    (i) When assessing payment for any amount due under
24subsection (g), the System shall exclude any salary increase
25described in subsection (h) of this Section given on or after
26July 1, 2011 but before July 1, 2014 under a contract or

 

 

09800HB3066ham001- 24 -LRB098 07778 JDS 43561 a

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

 

 

09800HB3066ham001- 25 -LRB098 07778 JDS 43561 a

1the positions submitted to those positions recognized for State
2universities by the State Universities Civil Service System.
3The Illinois Community College Board shall file a copy of its
4findings with the System. The System shall consider the
5findings of the Illinois Community College Board when making
6determinations under this Section. The System shall not exclude
7any earnings increases resulting from a promotion when the
8promotion was not submitted by a community college. Nothing in
9this subsection (k) shall require any community college to
10submit any information to the Community College Board.
11    (l) For purposes of determining the required State
12contribution to the System, the value of the System's assets
13shall be equal to the actuarial value of the System's assets,
14which shall be calculated as follows:
15    As of June 30, 2008, the actuarial value of the System's
16assets shall be equal to the market value of the assets as of
17that date. In determining the actuarial value of the System's
18assets for fiscal years after June 30, 2008, any actuarial
19gains or losses from investment return incurred in a fiscal
20year shall be recognized in equal annual amounts over the
215-year period following that fiscal year.
22    (m) For purposes of determining the required State
23contribution to the system for a particular year, the actuarial
24value of assets shall be assumed to earn a rate of return equal
25to the system's actuarially assumed rate of return.
26(Source: P.A. 96-43, eff. 7-15-09; 96-1497, eff. 1-14-11;

 

 

09800HB3066ham001- 26 -LRB098 07778 JDS 43561 a

196-1511, eff. 1-27-11; 96-1554, eff. 3-18-11; 97-813, eff.
27-13-12; revised 10-17-12.)
 
3    (40 ILCS 5/15-155.1 new)
4    Sec. 15-155.1. Actions to enforce payments by employers
5other than the State. Any employer, other than the State, that
6fails to transmit to the System contributions required of it
7under this Article or contributions required of employees, for
8more than 90 days after such contributions are due, is subject
9to the following: after giving notice to the employer, the
10System may certify to the State Comptroller or the Illinois
11Community College Board, whichever is applicable, the amounts
12of such delinquent payments and the State Comptroller or the
13Illinois Community College Board, whichever is applicable,
14shall deduct the amounts so certified or any part thereof from
15any State funds to be remitted to the employer and shall pay
16the amount so deducted to the System. If State funds from which
17such deductions may be made are not available, the System may
18proceed against the employer to recover the amounts of such
19delinquent payments in the appropriate circuit court.
20    The System may provide for an audit of the records of an
21employer, other than the State, as may be required to establish
22the amounts of required contributions. The employer shall make
23its records available to the System for the purpose of such
24audit. The cost of such audit shall be added to the amount of
25the delinquent payments and may be recovered by the System from

 

 

09800HB3066ham001- 27 -LRB098 07778 JDS 43561 a

1the employer at the same time and in the same manner as the
2delinquent payments are recovered.
 
3    (40 ILCS 5/15-157)  (from Ch. 108 1/2, par. 15-157)
4    Sec. 15-157. Employee Contributions.
5    (a) Each participating employee shall make contributions
6towards the retirement benefits payable under the retirement
7program applicable to the employee from each payment of
8earnings applicable to employment under this system on and
9after the date of becoming a participant as follows: Prior to
10September 1, 1949, 3 1/2% of earnings; from September 1, 1949
11to August 31, 1955, 5%; from September 1, 1955 to August 31,
121969, 6%; from September 1, 1969, 6 1/2%. These contributions
13are to be considered as normal contributions for purposes of
14this Article.
15    Each participant who is a police officer or firefighter
16shall make normal contributions of 8% of each payment of
17earnings applicable to employment as a police officer or
18firefighter under this system on or after September 1, 1981,
19unless he or she files with the board within 60 days after the
20effective date of this amendatory Act of 1991 or 60 days after
21the board receives notice that he or she is employed as a
22police officer or firefighter, whichever is later, a written
23notice waiving the retirement formula provided by Rule 4 of
24Section 15-136. This waiver shall be irrevocable. If a
25participant had met the conditions set forth in Section

 

 

09800HB3066ham001- 28 -LRB098 07778 JDS 43561 a

115-132.1 prior to the effective date of this amendatory Act of
21991 but failed to make the additional normal contributions
3required by this paragraph, he or she may elect to pay the
4additional contributions plus compound interest at the
5effective rate. If such payment is received by the board, the
6service shall be considered as police officer service in
7calculating the retirement annuity under Rule 4 of Section
815-136. While performing service described in clause (i) or
9(ii) of Rule 4 of Section 15-136, a participating employee
10shall be deemed to be employed as a firefighter for the purpose
11of determining the rate of employee contributions under this
12Section.
13    (b) Starting September 1, 1969, each participating
14employee shall make additional contributions of 1/2 of 1% of
15earnings to finance a portion of the cost of the annual
16increases in retirement annuity provided under Section 15-136,
17except that with respect to participants in the self-managed
18plan this additional contribution shall be used to finance the
19benefits obtained under that retirement program.
20    (c) In addition to the amounts described in subsections (a)
21and (b) of this Section, each participating employee shall make
22contributions of 1% of earnings applicable under this system on
23and after August 1, 1959. The contributions made under this
24subsection (c) shall be considered as survivor's insurance
25contributions for purposes of this Article if the employee is
26covered under the traditional benefit package, and such

 

 

09800HB3066ham001- 29 -LRB098 07778 JDS 43561 a

1contributions shall be considered as additional contributions
2for purposes of this Article if the employee is participating
3in the self-managed plan or has elected to participate in the
4portable benefit package and has completed the applicable
5one-year waiting period. Contributions in excess of $80 during
6any fiscal year beginning before August 31, 1969 and in excess
7of $120 during any fiscal year thereafter until September 1,
81971 shall be considered as additional contributions for
9purposes of this Article.
10    (d) If the board by board rule so permits and subject to
11such conditions and limitations as may be specified in its
12rules, a participant may make other additional contributions of
13such percentage of earnings or amounts as the participant shall
14elect in a written notice thereof received by the board.
15    (e) That fraction of a participant's total accumulated
16normal contributions, the numerator of which is equal to the
17number of years of service in excess of that which is required
18to qualify for the maximum retirement annuity, and the
19denominator of which is equal to the total service of the
20participant, shall be considered as accumulated additional
21contributions. The determination of the applicable maximum
22annuity and the adjustment in contributions required by this
23provision shall be made as of the date of the participant's
24retirement.
25    (f) Notwithstanding the foregoing, a participating
26employee shall not be required to make contributions under this

 

 

09800HB3066ham001- 30 -LRB098 07778 JDS 43561 a

1Section after the date upon which continuance of such
2contributions would otherwise cause his or her retirement
3annuity to exceed the maximum retirement annuity as specified
4in clause (1) of subsection (c) of Section 15-136.
5    (g) A participating employee may make contributions for the
6purchase of service credit under this Article.
7    (h) Notwithstanding any provision of this Code to the
8contrary, (i) for a member who does not file an election under
9subsection (e) of Section 15-158.2, any contributions on
10amounts of earnings in excess of the limit specified in Section
1115-112.1 for that year shall instead be used to finance
12self-managed plan benefits and (ii) for a member who files an
13election under subsection (e) of Section 15-158.2, any
14contributions made after the date of the election, including
15the contributions for a survivor's annuity, shall be used to
16finance the benefits under Section 15-158.2. Notwithstanding
17any provision of this Code to the contrary, a member who does
18not file an election under subsection (a-5) of Section 15-158.2
19shall contribute towards the traditional benefit package a
20percentage of earnings equal to the greater of (i) one-half of
21the normal cost of the traditional benefit package or (ii) 6%
22of earnings.
23(Source: P.A. 90-32, eff. 6-27-97; 90-65, eff. 7-7-97; 90-448,
24eff. 8-16-97; 90-511, eff. 8-22-97; 90-576, eff. 3-31-98;
2590-655, eff. 7-30-98; 90-766, eff. 8-14-98.)
 

 

 

09800HB3066ham001- 31 -LRB098 07778 JDS 43561 a

1    (40 ILCS 5/15-158.2)
2    Sec. 15-158.2. Self-managed plan.
3    (a) Purpose. The General Assembly finds that it is
4important for colleges and universities to be able to attract
5and retain the most qualified employees and that in order to
6attract and retain these employees, colleges and universities
7should have the flexibility to provide a defined contribution
8plan as an alternative for eligible employees who elect not to
9participate in a defined benefit retirement program provided
10under this Article. Accordingly, the State Universities
11Retirement System is hereby authorized to establish and
12administer a self-managed plan, which shall offer
13participating employees the opportunity to accumulate assets
14for retirement through a combination of employee and employer
15contributions that may be invested in mutual funds, collective
16investment funds, or other investment products and used to
17purchase annuity contracts, either fixed or variable or a
18combination thereof. The plan must be qualified under the
19Internal Revenue Code of 1986.
20    (b) Adoption by employers. Each employer subject to this
21Article may elect to adopt the self-managed plan established
22under this Section; this election is irrevocable. An employer's
23election to adopt the self-managed plan makes available to the
24eligible employees of that employer the elections described in
25Section 15-134.5.
26    The State Universities Retirement System shall be the plan

 

 

09800HB3066ham001- 32 -LRB098 07778 JDS 43561 a

1sponsor for the self-managed plan and shall prepare a plan
2document and prescribe such rules and procedures as are
3considered necessary or desirable for the administration of the
4self-managed plan. Consistent with its fiduciary duty to the
5participants and beneficiaries of the self-managed plan, the
6Board of Trustees of the System may delegate aspects of plan
7administration as it sees fit to companies authorized to do
8business in this State, to the employers, or to a combination
9of both.
10    (c) Selection of service providers and funding vehicles.
11The System, in consultation with the employers, shall solicit
12proposals to provide administrative services and funding
13vehicles for the self-managed plan from insurance and annuity
14companies and mutual fund companies, banks, trust companies, or
15other financial institutions authorized to do business in this
16State. In reviewing the proposals received and approving and
17contracting with no fewer than 2 and no more than 7 companies,
18the Board of Trustees of the System shall consider, among other
19things, the following criteria:
20        (1) the nature and extent of the benefits that would be
21    provided to the participants;
22        (2) the reasonableness of the benefits in relation to
23    the premium charged;
24        (3) the suitability of the benefits to the needs and
25    interests of the participating employees and the employer;
26        (4) the ability of the company to provide benefits

 

 

09800HB3066ham001- 33 -LRB098 07778 JDS 43561 a

1    under the contract and the financial stability of the
2    company; and
3        (5) the efficacy of the contract in the recruitment and
4    retention of employees.
5    The System, in consultation with the employers, shall
6periodically review each approved company. A company may
7continue to provide administrative services and funding
8vehicles for the self-managed plan only so long as it continues
9to be an approved company under contract with the Board.
10    (d) Employee Direction. Employees who are participating in
11the program must be allowed to direct the transfer of their
12account balances among the various investment options offered,
13subject to applicable contractual provisions. The participant
14shall not be deemed a fiduciary by reason of providing such
15investment direction. A person who is a fiduciary shall not be
16liable for any loss resulting from such investment direction
17and shall not be deemed to have breached any fiduciary duty by
18acting in accordance with that direction. Neither the System
19nor the employer guarantees any of the investments in the
20employee's account balances.
21    (e) Participation. An employee eligible to participate in
22the self-managed plan must make a written election in
23accordance with the provisions of Section 15-134.5 and the
24procedures established by the System or become subject to the
25limitation specified in Section 15-112.1. Participation in the
26self-managed plan by an electing employee shall begin on the

 

 

09800HB3066ham001- 34 -LRB098 07778 JDS 43561 a

1first day of the first pay period following the later of the
2date the employee's election is filed with the System, or the
3effective date as of which the employee's employer begins to
4offer participation in the self-managed plan, or the date the
5participant's annual earnings exceeds the limitation specified
6in Section 15-112.1. Employers may not make the self-managed
7plan available earlier than January 1, 1998. An employee's
8participation in any other retirement program administered by
9the System under this Article shall terminate on the date that
10participation in the self-managed plan begins.
11    An employee who participates has elected to participate in
12the self-managed plan under this Section must continue
13participation while employed in an eligible position, and may
14not participate in any other retirement program administered by
15the System under this Article while employed by that employer
16or any other employer that has adopted the self-managed plan,
17unless the self-managed plan is terminated in accordance with
18subsection (i).
19    Participation in the self-managed plan under this Section
20shall constitute membership in the State Universities
21Retirement System.
22    A participant under this Section shall be entitled to the
23benefits of Article 20 of this Code.
24    (f) Establishment of Initial Account Balance. If at the
25time an employee elects to participate in the self-managed plan
26he or she has rights and credits in the System due to previous

 

 

09800HB3066ham001- 35 -LRB098 07778 JDS 43561 a

1participation in the traditional benefit package, the System
2shall establish for the employee an opening account balance in
3the self-managed plan, equal to the amount of contribution
4refund that the employee would be eligible to receive under
5Section 15-154 if the employee terminated employment on that
6date and elected a refund of contributions, except that this
7hypothetical refund shall include interest at the effective
8rate for the respective years. The System shall transfer assets
9from the defined benefit retirement program to the self-managed
10plan, as a tax free transfer in accordance with Internal
11Revenue Service guidelines, for purposes of funding the
12employee's opening account balance.
13    (g) No Duplication of Service Credit. Notwithstanding any
14other provision of this Article, an employee may not purchase
15or receive service or service credit applicable to any other
16retirement program administered by the System under this
17Article for any period during which the employee was a
18participant in the self-managed plan established under this
19Section.
20    (h) Contributions.
21        (1) The self-managed plan shall be funded by
22    contributions from employees participating in the
23    self-managed plan and employer contributions as provided
24    in this Section.
25            (A) Before the effective date of this amendatory
26        Act of the 98th General Assembly, the The contribution

 

 

09800HB3066ham001- 36 -LRB098 07778 JDS 43561 a

1        rate for employees participating in the self-managed
2        plan under this Section shall be equal to the employee
3        contribution rate for other participants in the
4        System, as provided in Section 15-157. This required
5        contribution shall be made as an "employer pick-up"
6        under Section 414(h) of the Internal Revenue Code of
7        1986 or any successor Section thereof. Any employee
8        participating in the System's traditional benefit
9        package prior to his or her election to participate in
10        the self-managed plan shall continue to have the
11        employer pick up the contributions required under
12        Section 15-157. However, the amounts picked up after
13        the election of the self-managed plan shall be remitted
14        to and treated as assets of the self-managed plan. In
15        no event shall an employee have an option of receiving
16        these amounts in cash. Employees may make additional
17        contributions to the self-managed plan in accordance
18        with procedures prescribed by the System, to the extent
19        permitted under rules prescribed by the System.
20            (B) On and after the effective date of this
21        amendatory Act of the 98th General Assembly, the
22        contribution rate for participants in the self-managed
23        plan shall be, (i) for a participant who does not file
24        an election under subsection (e) of this Section, 6% of
25        the amount of earnings in excess of the limit specified
26        in 15-112.1 for that year, in addition to the amount

 

 

09800HB3066ham001- 37 -LRB098 07778 JDS 43561 a

1        specified under subsection (h) of Section 15-157 for
2        that year and (ii) for a participant who files an
3        election under subsection (e) of this Section, 8% of
4        any amount of earnings up to and including the limit
5        specified in Section 15-112.1 for that year and 6% of
6        any amount of earnings in excess of that limit for that
7        year. This required contribution shall be made as an
8        employer pick-up under Section 414(h) of the Internal
9        Revenue Code of 1986 or any successor Section thereof.
10        Any participant in the System's traditional benefit
11        package prior to his or her election to participate in
12        the self-managed plan shall continue to have the
13        employer pick up the contributions required under
14        Section 15-157. However, the amounts picked up after
15        the election of the self-managed plan shall be remitted
16        to and treated as assets of the self-managed plan. In
17        no event shall a participant have the option of
18        receiving these amounts in cash. Participants may make
19        additional contributions to the self-managed plan in
20        accordance with procedures prescribed by the System,
21        to the extent permitted under rules adopted by the
22        System.
23        (2) The program shall provide for employer and State
24    contributions to the self-managed plan in the following
25    amounts: (i) for a member who does not file an election
26    under subsection (e) of this Section, 3% of the amount of

 

 

09800HB3066ham001- 38 -LRB098 07778 JDS 43561 a

1    earnings in excess of the limit specified in Section
2    15-112.1 for that year, to be paid by the actual employer,
3    and (ii) for a member who files an election under
4    subsection (e) of this Section, 7.1% of any amount of
5    earnings up to and including the limit specified in Section
6    15-112.1 for that year, to be paid by the State, and 3% of
7    any amount of earnings in excess of that limit for that
8    year, to be paid by the actual employer.
9        The program shall provide for these employer and State
10    contributions to be credited to each self-managed plan
11    participant at a rate of 7.6% of the participating
12    employee's salary, less the amount used by the System to
13    provide disability benefits for the employee. The amounts
14    so credited shall be paid into the participant's
15    self-managed plan accounts in a manner to be prescribed by
16    the System.
17        (3) An amount of employer contribution, not exceeding
18    1% of the participating employee's salary, shall be used
19    for the purpose of providing the disability benefits of the
20    System to the employee. Prior to the beginning of each plan
21    year under the self-managed plan, the Board of Trustees
22    shall determine, as a percentage of salary, the amount of
23    employer contributions to be allocated during that plan
24    year for providing disability benefits for employees in the
25    self-managed plan.
26        (4) The State of Illinois shall make contributions by

 

 

09800HB3066ham001- 39 -LRB098 07778 JDS 43561 a

1    appropriations to the System of the employer contributions
2    required for employees who participate in the self-managed
3    plan under this Section. The amount required shall be
4    certified by the Board of Trustees of the System and paid
5    by the State in accordance with Section 15-165. The System
6    shall not be obligated to remit the required employer
7    contributions to any of the insurance and annuity
8    companies, mutual fund companies, banks, trust companies,
9    financial institutions, or other sponsors of any of the
10    funding vehicles offered under the self-managed plan until
11    it has received the required employer contributions from
12    the State. In the event of a deficiency in the amount of
13    State contributions, the System shall implement those
14    procedures described in subsection (c) of Section 15-165 to
15    obtain the required funding from the General Revenue Fund.
16    (i) Termination. The self-managed plan authorized under
17this Section may be terminated by the System, subject to the
18terms of any relevant contracts, and the System shall have no
19obligation to reestablish the self-managed plan under this
20Section. This Section does not create a right to continued
21participation in any self-managed plan set up by the System
22under this Section. If the self-managed plan is terminated, the
23participants shall have the right to participate in one of the
24other retirement programs offered by the System and receive
25service credit in such other retirement program for any years
26of employment following the termination.

 

 

09800HB3066ham001- 40 -LRB098 07778 JDS 43561 a

1    (j) Vesting; Withdrawal; Return to Service. A participant
2in the self-managed plan becomes vested in the employer
3contributions credited to his or her accounts in the
4self-managed plan on the earliest to occur of the following:
5(1) completion of 5 years of service with an employer described
6in Section 15-106; (2) the death of the participating employee
7while employed by an employer described in Section 15-106, if
8the participant has completed at least 1 1/2 years of service;
9or (3) the participant's election to retire and apply the
10reciprocal provisions of Article 20 of this Code.
11    A participant in the self-managed plan who receives a
12distribution of his or her vested amounts from the self-managed
13plan while not yet eligible for retirement under this Article
14(and Article 20, if applicable) shall forfeit all service
15credit and accrued rights in the System; if subsequently
16re-employed, the participant shall be considered a new
17employee. If a former participant again becomes a participating
18employee (or becomes employed by a participating system under
19Article 20 of this Code) and continues as such for at least 2
20years, all such rights, service credits, and previous status as
21a participant shall be restored upon repayment of the amount of
22the distribution, without interest.
23    (k) Benefit amounts. If an employee who is vested in
24employer contributions terminates employment, the employee
25shall be entitled to a benefit which is based on the account
26values attributable to both employer and employee

 

 

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1contributions and any investment return thereon.
2    If an employee who is not vested in employer contributions
3terminates employment, the employee shall be entitled to a
4benefit based solely on the account values attributable to the
5employee's contributions and any investment return thereon,
6and the employer contributions and any investment return
7thereon shall be forfeited. Any employer contributions which
8are forfeited shall be held in escrow by the company investing
9those contributions and shall be used as directed by the System
10for future allocations of employer contributions or for the
11restoration of amounts previously forfeited by former
12participants who again become participating employees.
13(Source: P.A. 93-347, eff. 7-24-03.)
 
14    (40 ILCS 5/15-159.1 new)
15    Sec. 15-159.1. New Board created.
16    (a) Beginning July 1, 2014, the Board created under Section
1715-159 is abolished and a board of 8 members shall constitute
18the Board of Trustees authorized to carry out the provisions of
19this Article. Each trustee shall be a participating employee of
20a participating employer or an annuitant of the Fund and no
21person shall be eligible to become a trustee after January 1,
221979 who does not have at least 8 years of creditable service.
23    (b) The board shall consist of representatives of various
24groups as follows:
25        (1) Four trustees shall be a chief executive officer,

 

 

09800HB3066ham001- 42 -LRB098 07778 JDS 43561 a

1    chief finance officer, or other officer, executive or
2    department head of a participating employer, and each such
3    trustee shall be designated as an executive trustee.
4        (2) Three trustees shall be employees of a
5    participating employer and each such trustee shall be
6    designated as an employee trustee.
7        (3) One trustee shall be an annuitant of the Fund, who
8    shall be designated the annuitant trustee.
9    (c) A person elected as a trustee shall qualify as a
10trustee, after declaration by the Board that he has been duly
11elected, upon taking and subscribing to the constitutional oath
12of office and filing same in the office of the Fund.
13    (d) The term of office of each trustee shall begin upon
14January 1 of the year following the year in which he is elected
15and shall continue for a period of 5 years and until a
16successor has been elected and qualified, or until prior
17resignation, death, incapacity or disqualification.
18    (e) Any elected trustee (other than the annuitant trustee)
19shall be disqualified immediately upon termination of
20employment with all participating municipalities and
21instrumentalities thereof or upon any change in status which
22removes any such trustee from all employments within the group
23he represents. The annuitant trustee shall be disqualified upon
24termination of his or her annuity.
25    (f) The trustees shall fill any vacancy in the Board by
26appointment, for the period until the next election of

 

 

09800HB3066ham001- 43 -LRB098 07778 JDS 43561 a

1trustees, or, if the remaining term is less than 2 years, for
2the remainder of the term, and until his successor has been
3elected and qualified.
4    (g) Trustees shall serve without compensation, but shall be
5reimbursed for any reasonable expenses incurred in attending
6meetings of the Board and in performing duties on behalf of the
7Fund and for the amount of any earnings withheld by any
8participating employer because of attendance at any Board
9meeting.
10    (h) Each trustee shall be entitled to one vote on any and
11all actions before the Board. At least 5 concurring votes shall
12be necessary for every decision or action by the Board at any
13of its meetings. No decision or action shall become effective
14unless presented and so approved at a regular or duly called
15special meeting of the Board.
 
16    (40 ILCS 5/15-165.1 new)
17    Sec. 15-165.1. To calculate the normal cost of benefits. To
18calculate the normal cost of each plan offered by the system as
19a percentage of earnings and to update those amounts at least
20every 3 years.
 
21    (40 ILCS 5/16-101)  (from Ch. 108 1/2, par. 16-101)
22    Sec. 16-101. Creation of system; consolidation.
23    (a) Effective July 1, 1939 and until July 1, 2013, there is
24created the "Teachers' Retirement System of the State of

 

 

09800HB3066ham001- 44 -LRB098 07778 JDS 43561 a

1Illinois" for the purpose of providing retirement annuities and
2other benefits for teachers, annuitants and beneficiaries. All
3of its business shall be transacted, its funds invested, and
4its assets held in such name.
5    (b) On July 1, 2013, the retirement system established
6under this Article is merged and consolidated into a single
7retirement fund, to be known as the Illinois Teachers'
8Retirement Fund, which shall be established and administered as
9prescribed in Article 15 of this Code.
10    (c) In preparation for that consolidation, the Board of
11Education and the City shall cooperate with the Board of
12Trustees of the Illinois Teachers' Retirement Fund.
13    (d) At the time of consolidation, or as otherwise directed
14by the Board of the Illinois Teachers' Retirement Fund, all
15assets and liabilities belonging to the System established
16under this Article shall become the assets and liabilities of
17the Illinois Teachers' Retirement Fund, and all current or
18former members and beneficiaries of the System established
19under this Article shall be deemed current or former
20participants and beneficiaries of the Illinois Teachers'
21Retirement Fund.
22    (e) The Illinois Teachers' Retirement Fund shall be the
23legal successor to the System established under this Article
24and it may exercise any of the rights and powers and perform
25any of the duties of that System. The Illinois Teachers'
26Retirement Fund may, in its discretion, either continue,

 

 

09800HB3066ham001- 45 -LRB098 07778 JDS 43561 a

1renegotiate, or terminate any personnel, service contract,
2lease, or other contract of the System established under this
3Article.
4    (f) The consolidation of the System established under this
5Article shall not diminish or impair the benefits of any person
6who participated in that System, or of any such person's
7surviving spouse, children, or other dependents.
8    Benefits already payable by the System on June 30, 2013
9shall become payable from the Illinois Teachers' Retirement
10Fund beginning on July 1, 2013, and shall not be subject to
11recalculation or combination due to the consolidation.
12    Benefits that first become payable on or after July 1, 2013
13shall be calculated and paid as provided in Article 15.
14    The consolidation of the System established under this
15Article does not entitle any person to a recalculation of any
16benefit previously granted or a refund of any contribution
17previously paid.
18(Source: P.A. 83-1440.)
 
19    (40 ILCS 5/17-101)  (from Ch. 108 1/2, par. 17-101)
20    Sec. 17-101. Creation of fund; consolidation.
21    Until July 1, 2013, in In each city with a population over
22500,000, there is created a Public School Teachers' Pension and
23Retirement Fund to be maintained and administered in the manner
24prescribed in this Article and to be known as the Public School
25Teachers' Pension and Retirement Fund of ....(city).

 

 

09800HB3066ham001- 46 -LRB098 07778 JDS 43561 a

1    (b) On July 1, 2013, the Fund established under this
2Article is merged and consolidated into a single retirement
3fund, to be known as the Illinois Teachers' Retirement Fund,
4which shall be established and administered as prescribed in
5Article 15 of this Code.
6    (c) In preparation for that consolidation, the Board of
7Education and the City shall cooperate with the Board of
8Trustees of the Illinois Teachers' Retirement Fund.
9    (d) At the time of consolidation, or as otherwise directed
10by the Board of the Illinois Teachers' Retirement Fund, all
11assets and liabilities belonging to the Fund established under
12this Article shall become the assets and liabilities of the
13Illinois Teachers' Retirement Fund, and all current or former
14members and beneficiaries of the Fund established under this
15Article shall be deemed current or former participants and
16beneficiaries of the Illinois Teachers' Retirement Fund.
17    (e) The Illinois Teachers' Retirement Fund shall be the
18legal successor to the Fund established under this Article and
19it may exercise any of the rights and powers and perform any of
20the duties of that pension fund. The Illinois Teachers'
21Retirement Fund may, in its discretion, either continue,
22renegotiate, or terminate any personnel, service contract,
23lease, or other contract of the Fund established under this
24Article.
25    (f) The consolidation of the pension fund established under
26this Article shall not diminish or impair the benefits of any

 

 

09800HB3066ham001- 47 -LRB098 07778 JDS 43561 a

1person who participated in that pension fund, or of any such
2person's surviving spouse, children, or other dependents.
3    Benefits already payable by this Fund on June 30, 2013
4shall become payable from the Illinois Teachers' Retirement
5Fund beginning on July 1, 2013, and shall not be subject to
6recalculation or combination due to the consolidation.
7    Benefits that first become payable on or after July 1, 2013
8shall be calculated as provided in Article 15.
9    The consolidation of the pension fund established under
10this Article does not entitle any person to a recalculation of
11any benefit previously granted or a refund of any contribution
12previously paid.
13(Source: Laws 1963, p. 161.)
 
14    Section 90. The State Mandates Act is amended by adding
15Section 8.37 as follows:
 
16    (30 ILCS 805/8.37 new)
17    Sec. 8.37. Exempt mandate. Notwithstanding Sections 6 and 8
18of this Act, no reimbursement by the State is required for the
19implementation of any mandate created by this amendatory Act of
20the 98th General Assembly.
 
21    Section 97. Inseverability. The provisions of this Act are
22inseverable.
 

 

 

09800HB3066ham001- 48 -LRB098 07778 JDS 43561 a

1    Section 99. Effective date. This Act takes effect upon
2becoming law.".