103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB2913

 

Introduced 1/26/2024, by Sen. Karina Villa

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/7-141  from Ch. 108 1/2, par. 7-141
40 ILCS 5/7-144  from Ch. 108 1/2, par. 7-144
30 ILCS 805/8.48 new

    Amends the Illinois Municipal Retirement Fund (IMRF) Article of the Illinois Pension Code. Provides that if any annuitant must be considered a participating employee because there was not a separation from service and the participating municipality or participating instrumentality that employs or re-employs that annuitant knowingly fails to notify the Board to suspend the annuity, the Board may review the totality of circumstances regarding the annuitant not having a separation of service and assign proportionate responsibility for reimbursement of the total of any annuity payments made to the annuitant after the date the annuity should have been suspended, as determined by the Board, between the participating municipality or participating instrumentality and the annuitant, less any amount actually repaid by the annuitant. Provides that in no case shall the total amount repaid by the annuitant plus any amount reimbursed by the employer to the Fund be more than the total of all annuity payments made to the annuitant after the date the annuity should have been suspended. Removes language providing that the provisions shall not apply if the annuitant returned to work for the employer for less than 12 months. Adds similar provisions to a provision concerning separation from service and entitlement to a retirement annuity. Amends the State Mandates Act to require implementation without reimbursement.


LRB103 36205 RPS 66298 b

STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT
MAY APPLY

 

 

A BILL FOR

 

SB2913LRB103 36205 RPS 66298 b

1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by
5changing Sections 7-141 and 7-144 as follows:
 
6    (40 ILCS 5/7-141)  (from Ch. 108 1/2, par. 7-141)
7    Sec. 7-141. Retirement annuities; conditions. Retirement
8annuities shall be payable as hereinafter set forth:
9    (a) A participating employee who, regardless of cause, is
10separated from the service of all participating municipalities
11and instrumentalities thereof and participating
12instrumentalities shall be entitled to a retirement annuity
13provided:
14        1. He is at least age 55 if he is a Tier 1 regular
15    employee, he is age 62 if he is a Tier 2 regular employee,
16    or, in the case of a person who is eligible to have his
17    annuity calculated under Section 7-142.1, he is at least
18    age 50;
19        2. He is not entitled to receive earnings for
20    employment in a position requiring him, or entitling him
21    to elect, to be a participating employee;
22        3. The amount of his annuity, before the application
23    of paragraph (b) of Section 7-142 is at least $10 per

 

 

SB2913- 2 -LRB103 36205 RPS 66298 b

1    month;
2        4. If he first became a participating employee after
3    December 31, 1961 and is a Tier 1 regular employee, he has
4    at least 8 years of service, or, if he is a Tier 2 regular
5    member, he has at least 10 years of service. This service
6    requirement shall not apply to any participating employee,
7    regardless of participation date, if the General Assembly
8    terminates the Fund.
9    (a-5) If any annuitant under this Article must be
10considered a participating employee because there was not a
11separation from service as required by subsection (a) of this
12Section and the participating municipality or participating
13instrumentality that employs or re-employs that annuitant
14knowingly fails to notify the Board to suspend the annuity,
15the Board may review the totality of circumstances regarding
16the annuitant not having a separation of service and assign
17proportionate responsibility for reimbursement of the total of
18any annuity payments made to the annuitant after the date the
19annuity should have been suspended, as determined by the
20Board, between the participating municipality or participating
21instrumentality and the annuitant, less any amount actually
22repaid by the annuitant. In no case shall the total amount
23repaid by the annuitant plus any amount reimbursed by the
24employer to the Fund be more than the total of all annuity
25payments made to the annuitant after the date the annuity
26should have been suspended.

 

 

SB2913- 3 -LRB103 36205 RPS 66298 b

1    (b) Retirement annuities shall be payable:
2        1. As provided in Section 7-119;
3        2. Except as provided in item 3, upon receipt by the
4    fund of a written application. The effective date may be
5    not more than one year prior to the date of the receipt by
6    the fund of the application;
7        3. Upon attainment of the required age of distribution
8    under Section 401(a)(9) of the Internal Revenue Code of
9    1986, as amended, if the member (i) is no longer in
10    service, and (ii) is otherwise entitled to an annuity
11    under this Article;
12        4. To the beneficiary of the deceased annuitant for
13    the unpaid amount accrued to date of death, if any.
14(Source: P.A. 102-210, Article 5, Section 5-5, eff. 7-30-21;
15102-210, Article 10, Section 10-5, eff. 1-1-22; 102-813, eff.
165-13-22.)
 
17    (40 ILCS 5/7-144)  (from Ch. 108 1/2, par. 7-144)
18    Sec. 7-144. Retirement annuities; suspended during
19employment.
20    (a) If any person receiving any annuity again becomes an
21employee and receives earnings from employment in a position
22requiring him, or entitling him to elect, to become a
23participating employee, then the annuity payable to such
24employee shall be suspended as of the first day of the month
25coincidental with or next following the date upon which such

 

 

SB2913- 4 -LRB103 36205 RPS 66298 b

1person becomes such an employee, unless the person is
2authorized under subsection (b) of Section 7-137.1 of this
3Code to continue receiving a retirement annuity during that
4period. Upon proper qualification of the participating
5employee payment of such annuity may be resumed on the first
6day of the month following such qualification and upon proper
7application therefor. The participating employee in such case
8shall be entitled to a supplemental annuity arising from
9service and credits earned subsequent to such re-entry as a
10participating employee.
11    Notwithstanding any other provision of this Article, an
12annuitant shall be considered a participating employee if he
13or she returns to work as an employee with a participating
14employer and works more than 599 hours annually (or 999 hours
15annually with a participating employer that has adopted a
16resolution pursuant to subsection (e) of Section 7-137 of this
17Code). Each of these annual periods shall commence on the
18month and day upon which the annuitant is first employed with
19the participating employer following the effective date of the
20annuity.
21    (a-5) If any annuitant under this Article must be
22considered a participating employee per the provisions of
23subsection (a) of this Section, and the participating
24municipality or participating instrumentality that employs or
25re-employs that annuitant knowingly fails to notify the Board
26that the annuitant has returned to a qualifying position, the

 

 

SB2913- 5 -LRB103 36205 RPS 66298 b

1Board may review the totality of circumstances of the return
2to work and assign proportionate responsibility for
3reimbursement of the total of any annuity payments made to the
4annuitant after the date the annuity should have been
5suspended, as determined by the Board, between to suspend the
6annuity, the participating municipality or participating
7instrumentality and the annuitant, less any amount actually
8repaid by the annuitant may be required to reimburse the Fund
9for an amount up to one-half of the total of any annuity
10payments made to the annuitant after the date the annuity
11should have been suspended, as determined by the Board. In no
12case shall the total amount repaid by the annuitant plus any
13amount reimbursed by the employer to the Fund be more than the
14total of all annuity payments made to the annuitant after the
15date the annuity should have been suspended. This subsection
16shall not apply if the annuitant returned to work for the
17employer for less than 12 months.
18    The Fund shall notify all annuitants that they must notify
19the Fund immediately if they return to work for any
20participating employer. The notification by the Fund shall
21occur upon retirement and no less than annually thereafter in
22a format determined by the Fund. The Fund shall also develop
23and maintain a system to track annuitants who have returned to
24work and notify the participating employer and annuitant at
25least annually of the limitations on returning to work under
26this Section.

 

 

SB2913- 6 -LRB103 36205 RPS 66298 b

1    (b) Supplemental annuities to persons who return to
2service for less than 48 months shall be computed under the
3provisions of Sections 7-141, 7-142, and 7-143. In determining
4whether an employee is eligible for an annuity which requires
5a minimum period of service, his entire period of service
6shall be taken into consideration but the supplemental annuity
7shall be based on earnings and service in the supplemental
8period only. The effective date of the suspended and
9supplemental annuity for the purpose of increases after
10retirement shall be considered to be the effective date of the
11suspended annuity.
12    (c) Supplemental annuities to persons who return to
13service for 48 months or more shall be a monthly amount
14determined as follows:
15        (1) An amount shall be computed under subparagraph b
16    of paragraph (1) of subsection (a) of Section 7-142,
17    considering all of the service credits of the employee.
18        (2) The actuarial value in monthly payments for life
19    of the annuity payments made before suspension shall be
20    determined and subtracted from the amount determined in
21    paragraph (1) above.
22        (3) The monthly amount of the suspended annuity, with
23    any applicable increases after retirement computed from
24    the effective date to the date of reinstatement, shall be
25    subtracted from the amount determined in paragraph (2)
26    above and the remainder shall be the amount of the

 

 

SB2913- 7 -LRB103 36205 RPS 66298 b

1    supplemental annuity provided that this amount shall not
2    be less than the amount computed under subsection (b) of
3    this Section.
4        (4) The suspended annuity shall be reinstated at an
5    amount including any increases after retirement from the
6    effective date to date of reinstatement.
7        (5) The effective date of the combined suspended and
8    supplemental annuities for the purposes of increases after
9    retirement shall be considered to be the effective date of
10    the supplemental annuity.
11    (d) If a Tier 2 regular employee becomes a member or
12participant under any other system or fund created by this
13Code and is employed on a full-time basis, except for those
14members or participants exempted from the provisions of
15subsection (a) of Section 1-160 of this Code (other than a
16participating employee under this Article), then the person's
17retirement annuity shall be suspended during that employment.
18Upon termination of that employment, the person's retirement
19annuity shall resume and be recalculated as required by this
20Section.
21    (e) If a Tier 2 regular employee first began participation
22on or after January 1, 2012 and is receiving a retirement
23annuity and accepts on a contractual basis a position to
24provide services to a governmental entity from which he or she
25has retired, then that person's annuity or retirement pension
26shall be suspended during that contractual service,

 

 

SB2913- 8 -LRB103 36205 RPS 66298 b

1notwithstanding the provisions of any other Section in this
2Article. Such annuitant shall notify the Fund, as well as his
3or her contractual employer, of his or her retirement status
4before accepting contractual employment. A person who fails to
5submit such notification shall be guilty of a Class A
6misdemeanor and required to pay a fine of $1,000. Upon
7termination of that contractual employment, the person's
8retirement annuity shall resume and be recalculated as
9required by this Section.
10(Source: P.A. 102-210, eff. 1-1-22; 103-154, eff. 6-30-23.)
 
11    Section 90. The State Mandates Act is amended by adding
12Section 8.48 as follows:
 
13    (30 ILCS 805/8.48 new)
14    Sec. 8.48. Exempt mandate. Notwithstanding Sections 6 and
158 of this Act, no reimbursement by the State is required for
16the implementation of any mandate created by this amendatory
17Act of the 103rd General Assembly.