HB5811 99TH GENERAL ASSEMBLY

LRB099 16150 RPS 40476 b

99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB5811

Introduced , by Rep. Barbara Wheeler

SYNOPSIS AS INTRODUCED:

40 ILCS 5/3-144.2	from Ch. 108 1/2, par. 3-144.2
40 ILCS 5/4-138.10

Amends the Downstate Police and Downstate Firefighter Articles of the Illinois Pension Code. In provisions concerning mistakes in benefit amounts, removes provisions that define "mistake". Effective immediately.

FISCAL NOTE ACT MAY APPLY

PENSION IMPACT NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning 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 3-144.2 and 4-138.10 as follows:

(40 ILCS 5/3-144.2) (from Ch. 108 1/2, par. 3-144.2)

Sec. 3-144.2. Mistake in benefit.

(a) If the Fund commits a mistake by setting any benefit at an incorrect amount, it shall adjust the benefit to the correct level as soon as may be practicable after the mistake is discovered. The term "mistake" includes a clerical or administrative error executed by the Fund or participant as it relates to a benefit under this Article; however, in no case shall "mistake" include any benefit as it relates to the reasonable calculation of the benefit or aspects of the benefit based on salary, service credit, calculation or determination of a disability, date of retirement, or other factors significant to the calculation of the benefit that were reasonably understood or agreed to by the Fund at the time of retirement.

(b) If the benefit was mistakenly set too low, the Fund shall make a lump sum payment to the recipient of an amount equal to the difference between the benefits that should have been paid and those actually paid, plus interest at the rate prescribed by the Public Pension Division of the Department of Insurance from the date the unpaid amounts accrued to the date of payment.

(c) If the benefit was mistakenly set too high, the Fund may recover the amount overpaid from the recipient thereof, either directly or by deducting such amount from the remaining benefits payable to the recipient as is indicated by the recipient. If the overpayment is recovered by deductions from the remaining benefits payable to the recipient, the monthly deduction shall not exceed 10% of the corrected monthly benefit unless otherwise indicated by the recipient.

However, if (i) the amount of the benefit was mistakenly set too high, and (ii) the error was undiscovered for 3 years or longer, and (iii) the error was not the result of fraud committed by the affected participant or beneficiary, then upon discovery of the mistake the benefit shall be adjusted to the correct level, but the recipient of the benefit need not repay to the Fund the excess amounts received in error.

(Source: P.A. 98-1117, eff. 8-26-14.)

(40 ILCS 5/4-138.10)

Sec. 4-138.10. Mistake in benefit.

(a) If the Fund commits a mistake by setting any benefit at an incorrect amount, it shall adjust the benefit to the correct level as soon as may be practicable after the mistake is discovered. The term "mistake" includes a clerical or administrative error executed by the Fund or participant as it relates to a benefit under this Article; however, in no case shall "mistake" include any benefit as it relates to the reasonable calculation of the benefit or aspects of the benefit based on salary, service credit, calculation or determination of a disability, date of retirement, or other factors significant to the calculation of the benefit that were reasonably understood or agreed to by the Fund at the time of retirement.

(b) If the benefit was mistakenly set too low, the Fund shall make a lump sum payment to the recipient of an amount equal to the difference between the benefits that should have been paid and those actually paid, plus interest at the rate prescribed by the Public Pension Division of the Department of Insurance from the date the unpaid amounts accrued to the date of payment.

(c) If the benefit was mistakenly set too high, the Fund may recover the amount overpaid from the recipient thereof, either directly or by deducting such amount from the remaining benefits payable to the recipient as is indicated by the recipient. If the overpayment is recovered by deductions from the remaining benefits payable to the recipient, the monthly deduction shall not exceed 10% of the corrected monthly benefit unless otherwise indicated by the recipient.

However, if (i) the amount of the benefit was mistakenly set too high, and (ii) the error was undiscovered for 3 years or longer, and (iii) the error was not the result of fraud committed by the affected participant or beneficiary, then upon discovery of the mistake the benefit shall be adjusted to the correct level, but the recipient of the benefit need not repay to the Fund the excess amounts received in error.

(Source: P.A. 98-1117, eff. 8-26-14.)

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