093_SB0589

 
                                     LRB093 07914 EFG 08105 b

 1        AN ACT in relation to public employee benefits.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 5.  The  Illinois  Pension  Code  is  amended  by
 5    changing Sections 15-142 and 15-145 as follows:

 6        (40 ILCS 5/15-142) (from Ch. 108 1/2, par. 15-142)
 7        Sec.  15-142.  Death benefits - Death of annuitant.  Upon
 8    the death of an annuitant receiving a retirement  annuity  or
 9    disability  retirement  annuity,  the annuitant's beneficiary
10    shall, if a survivor's insurance benefit is not payable under
11    Section 15-145 and an annuity is not  payable  under  Section
12    15-136.4, be entitled to a death benefit equal to the greater
13    of  the  following: (1) the excess, if any, of the sum of the
14    accumulated  normal,  survivors  insurance,  and   additional
15    contributions  as  of  the date of retirement or the date the
16    disability retirement annuity began,  whichever  is  earlier,
17    over  the  sum of all annuity payments made prior to the date
18    of death, or (2) $5,000 $1,000.
19    (Source: P.A. 90-448, eff.  8-16-97;  90-766,  eff.  8-14-98;
20    91-887, eff. 7-6-00.)

21        (40 ILCS 5/15-145) (from Ch. 108 1/2, par. 15-145)
22        Sec.  15-145.   Survivors  insurance benefits; conditions
23    and amounts.
24        (a)  The survivors insurance benefits provided under this
25    Section shall be payable  to  the  eligible  survivors  of  a
26    participant  covered  under  the  traditional benefit package
27    upon the death of (1) a participating employee with at  least
28    1 1/2  years  of  service,  (2)  a participant who terminated
29    employment with at least 10 years  of  service,  and  (3)  an
30    annuitant  in  receipt  of a retirement annuity or disability
 
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 1    retirement annuity under this Article.
 2        Service under the State Employees' Retirement  System  of
 3    Illinois,  the  Teachers'  Retirement  System of the State of
 4    Illinois  and  the  Public  School  Teachers'   Pension   and
 5    Retirement Fund of Chicago shall be considered in determining
 6    eligibility for survivors benefits under this Section.
 7        If  by law, a function of a governmental unit, as defined
 8    by Section 20-107, is transferred in whole or in part  to  an
 9    employer,  and  an  employee  transfers  employment from this
10    governmental unit to such employer within 6 months after  the
11    transfer  of  this  function,  the  service  credits  in  the
12    governmental   unit's   retirement  system  which  have  been
13    validated  under  Section  20-109  shall  be  considered   in
14    determining  eligibility  for  survivors  benefits under this
15    Section.
16        (b)  A surviving spouse of a deceased participant, or  of
17    a  deceased annuitant who did not take a refund or additional
18    annuity  consisting  of   accumulated   survivors   insurance
19    contributions,  shall  receive  a survivors annuity of 30% of
20    the final rate of earnings.  Payments shall begin on the  day
21    following  the participant's or annuitant's death or the date
22    the surviving spouse attains age 50, whichever is later,  and
23    continue  until  the  death  of  the  surviving  spouse.  The
24    annuity shall be payable to the  surviving  spouse  prior  to
25    attainment  of  age  50 if the surviving spouse has in his or
26    her care a deceased participant's  or  annuitant's  dependent
27    unmarried  child  under  age  18 (under age 22 if a full-time
28    student) who is eligible for a survivors annuity.
29        Remarriage of a surviving spouse prior to  attainment  of
30    age  55  that  occurs  before  the  effective  date  of  this
31    amendatory  Act of the 91st General Assembly shall disqualify
32    him or her for the receipt of a survivors annuity until  July
33    6, 2000.
34        A  surviving  spouse  whose  survivors  annuity  has been
 
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 1    terminated due to remarriage may apply for  reinstatement  of
 2    that  annuity.   The reinstated annuity shall begin to accrue
 3    on July 6, 2000, except that if, on July 6, 2000, the annuity
 4    is payable to an eligible surviving child or parent,  payment
 5    of   the  annuity  to  the  surviving  spouse  shall  not  be
 6    reinstated until the annuity is  no  longer  payable  to  any
 7    eligible  surviving  child or parent.  The reinstated annuity
 8    shall include any one-time or annual increases received prior
 9    to the date of termination, as well  as  any  increases  that
10    would  otherwise have accrued from the date of termination to
11    the date of reinstatement.    An  eligible  surviving  spouse
12    whose  expectation  of receiving a survivors annuity was lost
13    due to remarriage before attainment of age 50 shall  also  be
14    entitled  to  reinstatement  under  this  subsection, but the
15    resulting survivors annuity shall not begin to accrue  sooner
16    than upon the surviving spouse's attainment of age 50.
17        The  changes  made  to this subsection by this amendatory
18    Act of the 92nd General Assembly  (pertaining  to  remarriage
19    prior  to  age  55 or 50) apply without regard to whether the
20    deceased participant or annuitant was in service on or  after
21    the effective date of this amendatory Act.
22        (c)  Each  dependent  unmarried child under age 18 (under
23    age 22 if a full-time student) of a deceased participant,  or
24    of  a  deceased  annuitant  who  did  not  take  a  refund or
25    additional  annuity  consisting  of   accumulated   survivors
26    insurance  contributions,  shall  receive a survivors annuity
27    equal to the sum of (1) 20% of the final  rate  of  earnings,
28    and  (2)  10%  of  the  final rate of earnings divided by the
29    number of children entitled to this benefit.  Payments  shall
30    begin  on  the day following the participant's or annuitant's
31    death and continue until the child marries, dies, or  attains
32    age  18  (age 22 if a full-time student).  If the child is in
33    the care of a surviving spouse who is eligible for  survivors
34    insurance  benefits, the child's benefit shall be paid to the
 
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 1    surviving spouse.
 2        Each  unmarried  child  over  age  18   of   a   deceased
 3    participant  or  of a deceased annuitant who had a survivor's
 4    insurance beneficiary at the time of his or  her  retirement,
 5    and  who  was  dependent upon the participant or annuitant by
 6    reason of a physical or mental disability which  began  prior
 7    to  the date the child attained age 18 (age 22 if a full-time
 8    student), shall receive a survivor's annuity equal to the sum
 9    of (1) 20% of the final rate of earnings, and (2) 10% of  the
10    final  rate  of  earnings  divided  by the number of children
11    entitled to survivors benefits.  Payments shall begin on  the
12    day  following  the  participant's  or  annuitant's death and
13    continue until the child  marries,  dies,  or  is  no  longer
14    disabled.   If the child is in the care of a surviving spouse
15    who is eligible for survivors insurance benefits, the child's
16    benefit may  be  paid  to  the  surviving  spouse.   For  the
17    purposes  of  this  Section,  disability  means  inability to
18    engage in any substantial gainful activity by reason  of  any
19    medically determinable physical or mental impairment that can
20    be  expected  to result in death or that has lasted or can be
21    expected to last for a continuous  period  of  at  least  one
22    year.
23        (d)  Each  dependent parent of a deceased participant, or
24    of a  deceased  annuitant  who  did  not  take  a  refund  or
25    additional   annuity   consisting  of  accumulated  survivors
26    insurance contributions, shall receive  a  survivors  annuity
27    equal  to  the  sum of (1) 20% of final rate of earnings, and
28    (2) 10% of final rate of earnings divided by  the  number  of
29    parents  who  qualify  for the benefit.  Payments shall begin
30    when the parent reaches age  55  or  the  day  following  the
31    participant's  or  annuitant's death, whichever is later, and
32    continue until the parent dies.  Remarriage of a parent prior
33    to attainment of age 55 shall disqualify the parent  for  the
34    receipt of a survivors annuity.
 
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 1        (e)  In addition to the survivors annuity provided above,
 2    each survivors insurance beneficiary shall, upon death of the
 3    participant  or  annuitant,  receive  a  lump  sum payment of
 4    $5,000 $1,000 divided by the number of such beneficiaries.
 5        (f)  The changes made  in  this  Section  by  Public  Act
 6    81-712   pertaining   to  survivors  annuities  in  cases  of
 7    remarriage prior to age 55  shall  apply  to  each  survivors
 8    insurance  beneficiary  who  remarries  after  June 30, 1979,
 9    regardless of the date  that  the  participant  or  annuitant
10    terminated his employment or died.
11        The change made to this Section by this amendatory Act of
12    the  91st General Assembly, pertaining to remarriage prior to
13    age 55,  applies  without  regard  to  whether  the  deceased
14    participant  or  annuitant  was  in  service  on or after the
15    effective date of this amendatory Act  of  the  91st  General
16    Assembly.
17        (g)  On  January  1, 1981, any person who was receiving a
18    survivors annuity on or before January 1, 1971 shall have the
19    survivors annuity then being paid increased by  1%  for  each
20    full  year which has elapsed from the date the annuity began.
21    On January 1, 1982, any survivor whose  annuity  began  after
22    January  1,  1971, but before January 1, 1981, shall have the
23    survivor's annuity then being paid increased by 1%  for  each
24    year  which  has elapsed from the date the survivor's annuity
25    began. On January 1, 1987, any survivor who began receiving a
26    survivor's annuity on or before January 1, 1977,  shall  have
27    the  monthly survivor's annuity increased by $1 for each full
28    year which has elapsed since the date the survivor's  annuity
29    began.
30        (h)  If  the  sum  of  the  lump  sum  and  total monthly
31    survivor benefits payable under this Section upon  the  death
32    of  a  participant  amounts to less than the sum of the death
33    benefits payable under items (2) and (3) of  Section  15-141,
34    the difference shall be paid in a lump sum to the beneficiary
 
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 1    of  the  participant  who  is  living  on  the date that this
 2    additional amount becomes payable.
 3        (i)  If the  sum  of  the  lump  sum  and  total  monthly
 4    survivor  benefits  payable under this Section upon the death
 5    of an annuitant receiving a retirement annuity or  disability
 6    retirement  annuity  amounts  to  less than the death benefit
 7    payable under Section 15-142, the difference shall be paid to
 8    the beneficiary of the annuitant who is living  on  the  date
 9    that this additional amount becomes payable.
10        (j)  Effective  on  the  later of (1) January 1, 1990, or
11    (2) the January 1 on or next after  the  date  on  which  the
12    survivor  annuity  begins,  if the deceased member died while
13    receiving a retirement annuity, or in  all  other  cases  the
14    January  1  nearest  the  first  anniversary  of the date the
15    survivor annuity payments begin,  every  survivors  insurance
16    beneficiary  shall  receive an increase in his or her monthly
17    survivors annuity of 3%.  On each January 1 after the initial
18    increase, the monthly survivors annuity shall be increased by
19    3%  of  the  total  survivors  annuity  provided  under  this
20    Article,  including  previous  increases  provided  by   this
21    subsection.   Such  increases  shall  apply  to the survivors
22    insurance beneficiaries of each  participant  and  annuitant,
23    whether  or  not  the employment status of the participant or
24    annuitant  terminates  before  the  effective  date  of  this
25    amendatory Act of 1990.  This subsection (j) also applies  to
26    persons  receiving  a  survivor  annuity  under  the portable
27    benefit package.
28        (k)  If the Internal Revenue Code of  1986,  as  amended,
29    requires  that  the  survivors  benefits be payable at an age
30    earlier than that specified  in  this  Section  the  benefits
31    shall   begin  at  the  earlier  age,  in  which  event,  the
32    survivor's beneficiary shall be entitled only to that  amount
33    which  is  equal  to the actuarial equivalent of the benefits
34    provided by this Section.
 
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 1        (l)  The changes made to this Section and Section  15-131
 2    by  this  amendatory  Act  of  1997, relating to benefits for
 3    certain unmarried children who are full-time  students  under
 4    age  22,  apply without regard to whether the deceased member
 5    was in service  on  or  after  the  effective  date  of  this
 6    amendatory  Act  of 1997.  These changes do not authorize the
 7    repayment of a refund or a re-election of benefits,  and  any
 8    benefit  or increase in benefits resulting from these changes
 9    is not  payable  retroactively  for  any  period  before  the
10    effective date of this amendatory Act of 1997.
11        (m)  The  changes  made  to  subsection  (e)  and Section
12    15-142 by this amendatory Act of the 93rd  General  Assembly,
13    increasing  certain  death  benefits  from  $1,000 to $5,000,
14    apply to deceased members who die on or after  the  effective
15    date  of  this  amendatory  Act of the 93rd General Assembly,
16    regardless of whether the deceased member was in  service  on
17    or after that date.  The General Assembly declares its intent
18    that   up  to  $5,000  of  the  death  benefits  provided  in
19    subsection (e) and Section 15-142 are in the nature  of  life
20    insurance.   Subject to obtaining a favorable ruling from the
21    U.S. Internal Revenue Service, those death benefits shall not
22    be subject to the federal income tax.
23    (Source: P.A. 91-887, eff. 7-6-00; 92-749, eff. 8-2-02.)

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