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1 | AN ACT concerning public employee benefits.
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2 | Be it enacted by the People of the State of Illinois,
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3 | represented in the General Assembly:
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4 | Section 5. The Illinois Pension Code is amended by changing | ||||||
5 | Sections 15-112, 15-154, and 15-157 and adding Section 15-126.2 | ||||||
6 | as follows:
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7 | (40 ILCS 5/15-112) (from Ch. 108 1/2, par. 15-112)
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8 | Sec. 15-112. Final rate of earnings. "Final rate of | ||||||
9 | earnings": | ||||||
10 | (a) This subsection (a) applies only to a Tier 1 member. | ||||||
11 | For an employee who is paid on an hourly basis or who | ||||||
12 | receives an annual salary
in installments during 12 months of | ||||||
13 | each academic year, the average annual
earnings during the 48 | ||||||
14 | consecutive calendar month period ending with the last
day of | ||||||
15 | final termination of employment or the 4 consecutive academic | ||||||
16 | years of
service in which the employee's earnings were the | ||||||
17 | highest, whichever is
greater.
For any other employee, the | ||||||
18 | average annual earnings during the 4 consecutive
academic years | ||||||
19 | of service in which his or her earnings were the highest.
For | ||||||
20 | an employee with less than 48 months or 4 consecutive academic | ||||||
21 | years of
service, the average earnings during his or her entire | ||||||
22 | period of service.
The earnings of an employee with more than | ||||||
23 | 36 months of service under item (a) of Section 15-113.1 prior |
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1 | to the
date of becoming a participant are, for such period, | ||||||
2 | considered equal to the
average earnings during the last 36 | ||||||
3 | months of such service. | ||||||
4 | (b) This subsection (b) applies to a Tier 2 member. | ||||||
5 | For an employee who is paid on an hourly basis or who | ||||||
6 | receives an annual salary in installments during 12 months of | ||||||
7 | each academic year, the average annual earnings obtained by | ||||||
8 | dividing by 8 the total earnings of the employee during the 96 | ||||||
9 | consecutive months in which the total earnings were the highest | ||||||
10 | within the last 120 months prior to termination. | ||||||
11 | For any other employee, the average annual earnings during | ||||||
12 | the 8 consecutive academic years within the 10 years prior to | ||||||
13 | termination in which the employee's earnings were the highest. | ||||||
14 | For an employee with less than 96 consecutive months or 8 | ||||||
15 | consecutive academic years of service, whichever is necessary, | ||||||
16 | the average earnings during his or her entire period of | ||||||
17 | service. | ||||||
18 | (c) For an
employee on leave of absence with pay, or on | ||||||
19 | leave of absence without pay
who makes contributions during | ||||||
20 | such leave, earnings are assumed to be equal
to the basic | ||||||
21 | compensation on the date the leave began. | ||||||
22 | (d) For an employee on
disability leave, earnings are | ||||||
23 | assumed to be equal to the basic compensation
on the date | ||||||
24 | disability occurs or the average earnings during the 24 months
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25 | immediately preceding the month in which disability occurs, | ||||||
26 | whichever is
greater.
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1 | (e) For a Tier 1 member who retires on or after the | ||||||
2 | effective date of this
amendatory Act of 1997 with at least 20 | ||||||
3 | years of service as a firefighter or
police officer under this | ||||||
4 | Article, the final rate of earnings shall be the
annual rate of | ||||||
5 | earnings received by the participant on his or her last day as | ||||||
6 | a
firefighter or police officer under this Article, if that is | ||||||
7 | greater than the
final rate of earnings as calculated under the | ||||||
8 | other provisions of this
Section.
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9 | (f) If a Tier 1 member is an employee for at least
6 months | ||||||
10 | during the academic year in which his or her employment
is | ||||||
11 | terminated, the annual final rate of earnings shall be 25% of | ||||||
12 | the sum
of (1) the annual basic compensation for that year, and | ||||||
13 | (2) the amount
earned during the 36 months immediately | ||||||
14 | preceding that year, if this is
greater than the final rate of | ||||||
15 | earnings as calculated under the other
provisions of this | ||||||
16 | Section.
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17 | (g) In the determination of the final rate of earnings for | ||||||
18 | an employee, that
part of an employee's earnings for any | ||||||
19 | academic year beginning after June 30,
1997, which exceeds the | ||||||
20 | employee's earnings with that employer for the
preceding year | ||||||
21 | by more than 20 percent shall be excluded; in the event
that an | ||||||
22 | employee has more than one employer
this limitation shall be | ||||||
23 | calculated separately for the earnings with
each employer. In | ||||||
24 | making such calculation, only the basic compensation of
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25 | employees shall be considered, without regard to vacation or | ||||||
26 | overtime or to
contracts for summer employment.
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1 | (h) The following are not considered as earnings in | ||||||
2 | determining final rate of
earnings: (1) severance or separation | ||||||
3 | pay, (2) retirement pay, (3)
payment for unused sick leave, and | ||||||
4 | (4) payments from an employer for
the period used in | ||||||
5 | determining final rate of earnings for any purpose other
than | ||||||
6 | (i) services rendered, (ii) leave of absence or vacation | ||||||
7 | granted
during that period, and (iii) vacation of up to 56 work | ||||||
8 | days allowed upon
termination of employment; except that, if | ||||||
9 | the benefit has been collectively
bargained between the | ||||||
10 | employer and the recognized collective bargaining agent
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11 | pursuant to the Illinois Educational Labor Relations Act, | ||||||
12 | payment received
during a period of up to 2 academic years for | ||||||
13 | unused sick leave may be
considered as earnings in accordance | ||||||
14 | with the applicable collective bargaining
agreement, subject | ||||||
15 | to the 20% increase limitation of this Section, and if the
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16 | person first becomes a participant on or after the effective | ||||||
17 | date of this amendatory Act of the 98th General Assembly,
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18 | payments for unused sick or vacation time shall not be
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19 | considered as earnings. Any unused
sick leave considered as | ||||||
20 | earnings under this Section shall not be taken into
account in | ||||||
21 | calculating service credit under Section 15-113.4.
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22 | (i) Intermittent periods of service shall be considered as | ||||||
23 | consecutive in
determining final rate of earnings.
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24 | (Source: P.A. 98-92, eff. 7-16-13; 98-599, eff. 6-1-14 .)
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25 | (40 ILCS 5/15-126.2 new) |
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1 | Sec. 15-126.2. Plan year. "Plan year": The 12-month period | ||||||
2 | beginning on July 1 in any year, and ending on June 30 of the | ||||||
3 | succeeding year.
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4 | (40 ILCS 5/15-154) (from Ch. 108 1/2, par. 15-154)
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5 | Sec. 15-154. Refunds.
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6 | (a) A participant whose status as an employee is | ||||||
7 | terminated, regardless of
cause, or who has been on lay off | ||||||
8 | status for more than 120 days, and who is not
on leave of | ||||||
9 | absence, is entitled to a refund of contributions upon | ||||||
10 | application;
except that not more than one such refund | ||||||
11 | application may be made during any
academic year.
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12 | Except as set forth in subsections (a-1) and (a-2), the | ||||||
13 | refund shall
be the sum of the accumulated normal, additional, | ||||||
14 | and survivors insurance
contributions, plus the entire | ||||||
15 | contribution made by the participant under
Section 15-113.3, | ||||||
16 | less the amount of interest credited on these contributions
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17 | each year in excess of 4 1/2% of the amount on which interest | ||||||
18 | was calculated.
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19 | (a-1) A person who elects, in accordance with the | ||||||
20 | requirements of Section
15-134.5, to participate in the | ||||||
21 | portable benefit package and who becomes a
participating | ||||||
22 | employee under that retirement program upon the conclusion of
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23 | the one-year waiting period applicable to the portable benefit | ||||||
24 | package election
shall have his or her refund calculated in | ||||||
25 | accordance with the provisions of
subsection (a-2).
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1 | (a-2) The refund payable to a participant described in | ||||||
2 | subsection (a-1)
shall be the sum of the participant's | ||||||
3 | accumulated normal and additional
contributions, as defined in | ||||||
4 | Sections 15-116 and 15-117, plus the entire
contribution made | ||||||
5 | by the participant under Section 15-113.3. If the
participant | ||||||
6 | terminates with 5 or more years of service for employment as
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7 | defined in Section 15-113.1, he or she shall also be entitled | ||||||
8 | to a distribution
of employer contributions in an amount equal | ||||||
9 | to the sum of the accumulated
normal and additional | ||||||
10 | contributions, as defined in Sections 15-116 and 15-117.
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11 | (b) Upon acceptance of a refund, the participant forfeits | ||||||
12 | all
accrued rights and credits in the System, and if | ||||||
13 | subsequently reemployed, the
participant shall be considered a | ||||||
14 | new employee subject to all the qualifying
conditions for | ||||||
15 | participation and eligibility for benefits applicable to new
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16 | employees. If such person again becomes a participating | ||||||
17 | employee and continues
as such for 2 years, or is employed by | ||||||
18 | an employer and participates for at
least 2 years in the | ||||||
19 | Federal Civil Service Retirement System, all such rights,
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20 | credits, and previous status as a participant shall be restored | ||||||
21 | upon repayment
of the amount of the refund, together with | ||||||
22 | compound interest thereon from the
date the refund was issued | ||||||
23 | received to the date of repayment at the rate of 6% per
annum | ||||||
24 | through August 31, 1982, and at the effective rates after that | ||||||
25 | date.
When a participant in the portable benefit package who | ||||||
26 | received a refund
which included a distribution of employer |
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1 | contributions repays a refund
pursuant to this Section, | ||||||
2 | one-half of the amount repaid shall be deemed the
member's | ||||||
3 | reinstated accumulated normal and additional contributions and | ||||||
4 | the
other half shall be allocated as an employer contribution | ||||||
5 | to the System,
except that any amount repaid for previously | ||||||
6 | purchased military service
credit under Section 15-113.3 shall | ||||||
7 | be accounted for as such.
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8 | (c) If a participant covered under the traditional
benefit | ||||||
9 | package has made survivors insurance contributions, but has no
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10 | survivors insurance beneficiary upon retirement, he or she | ||||||
11 | shall be entitled
to elect a refund of the accumulated | ||||||
12 | survivors insurance contributions, or to
elect an additional | ||||||
13 | annuity the value of which is equal to the accumulated
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14 | survivors insurance contributions. This election must be made | ||||||
15 | prior to the
date the person's retirement annuity is approved | ||||||
16 | by the System.
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17 | (d) A participant, upon application, is entitled to a | ||||||
18 | refund of his
or her accumulated additional contributions | ||||||
19 | attributable to the additional
contributions described in the | ||||||
20 | last sentence of subsection (c) of Section
15-157. Upon the | ||||||
21 | acceptance of such a refund of accumulated additional
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22 | contributions, the participant forfeits all rights and credits | ||||||
23 | which may
have accrued because of such contributions.
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24 | (e) A participant who terminates his or her employee status | ||||||
25 | and elects to
waive service credit under Section 15-154.2, is | ||||||
26 | entitled to a refund of the
accumulated normal, additional and |
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1 | survivors insurance contributions, if any,
which were credited | ||||||
2 | the participant for this service, or to an additional
annuity | ||||||
3 | the value of which is equal to the accumulated normal, | ||||||
4 | additional and
survivors insurance contributions, if any; | ||||||
5 | except that not more than one such
refund application may be | ||||||
6 | made during any academic year. Upon acceptance of
this refund, | ||||||
7 | the participant forfeits all rights and credits accrued because
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8 | of this service.
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9 | (f) If a police officer or firefighter receives a | ||||||
10 | retirement annuity
under Rule 1 or 3 of Section 15-136, he or | ||||||
11 | she shall be entitled at
retirement to a refund of the | ||||||
12 | difference between his or her accumulated
normal contributions | ||||||
13 | and the normal contributions which would have
accumulated had | ||||||
14 | such person filed a waiver of the retirement formula
provided | ||||||
15 | by Rule 4 of Section 15-136.
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16 | (g) If, at the time of retirement, a participant would be | ||||||
17 | entitled to
a retirement annuity under Rule 1, 2, 3, 4, or 5 of | ||||||
18 | Section 15-136, or under
Section 15-136.4, that exceeds
the | ||||||
19 | maximum specified in clause (1) of subsection (c) of Section | ||||||
20 | 15-136, he
or she shall be entitled to a refund of the employee | ||||||
21 | contributions, if any,
paid under Section 15-157 after the date | ||||||
22 | upon which continuance of such
contributions would have | ||||||
23 | otherwise caused the retirement annuity to exceed
this maximum, | ||||||
24 | plus compound interest at the effective rates.
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25 | (Source: P.A. 92-16, eff. 6-28-01;
92-424, eff. 8-17-01; | ||||||
26 | 93-347, eff. 7-24-03.)
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1 | (40 ILCS 5/15-157) (from Ch. 108 1/2, par. 15-157)
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2 | Sec. 15-157. Employee contributions.
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3 | (a) Except as provided in subsection (a-5), each | ||||||
4 | participating employee
shall make contributions towards the | ||||||
5 | retirement
benefits payable under the retirement program | ||||||
6 | applicable to the
employee from each payment
of earnings | ||||||
7 | applicable to employment under this system on and after the
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8 | date of becoming a participant as follows: Prior to September | ||||||
9 | 1, 1949,
3 1/2% of earnings; from September 1, 1949 to August | ||||||
10 | 31, 1955, 5%; from
September 1, 1955 to August 31, 1969, 6%; | ||||||
11 | from September 1, 1969, 6 1/2%.
These contributions are to be | ||||||
12 | considered as normal contributions for purposes
of this | ||||||
13 | Article.
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14 | Except as provided in subsection (a-5), each participant | ||||||
15 | who is a police officer or firefighter shall make normal
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16 | contributions of 8% of each payment of earnings applicable to | ||||||
17 | employment as a
police officer or firefighter under this system | ||||||
18 | on or after September 1, 1981,
unless he or she files with the | ||||||
19 | board within 60 days after the effective date
of this | ||||||
20 | amendatory Act of 1991 or 60 days after the board receives | ||||||
21 | notice that
he or she is employed as a police officer or | ||||||
22 | firefighter, whichever is later,
a written notice waiving the | ||||||
23 | retirement formula provided by Rule 4 of Section
15-136. This | ||||||
24 | waiver shall be irrevocable. If a participant had met the
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25 | conditions set forth in Section 15-132.1 prior to the effective |
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1 | date of this
amendatory Act of 1991 but failed to make the | ||||||
2 | additional normal contributions
required by this paragraph, he | ||||||
3 | or she may elect to pay the additional
contributions plus | ||||||
4 | compound interest at the effective rate. If such payment
is | ||||||
5 | received by the board, the service shall be considered as | ||||||
6 | police officer
service in calculating the retirement annuity | ||||||
7 | under Rule 4 of Section 15-136.
While performing service | ||||||
8 | described in clause (i) or (ii) of Rule 4 of Section
15-136, a | ||||||
9 | participating employee shall be deemed to be employed as a
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10 | firefighter for the purpose of determining the rate of employee | ||||||
11 | contributions
under this Section.
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12 | (a-5) Beginning July 1, 2014, in lieu of the contribution | ||||||
13 | otherwise required under subsection (a), each Tier 1 member, | ||||||
14 | other than a Tier 1 member who is a police officer or | ||||||
15 | firefighter, shall contribute 6% of earnings toward the | ||||||
16 | retirement benefits payable under the retirement programs | ||||||
17 | applicable to the employee from each payment of earnings | ||||||
18 | applicable to employment under this system. | ||||||
19 | Beginning July 1, 2014, in lieu of the contribution | ||||||
20 | otherwise required under subsection (a), each Tier 1 member who | ||||||
21 | is a police officer or firefighter shall contribute 7.5% of | ||||||
22 | each payment of earnings applicable to employment as a police | ||||||
23 | officer or firefighter under this system, unless he or she has | ||||||
24 | filed a waiver with the board pursuant to subsection (a). | ||||||
25 | The contributions required under this subsection (a-5) are | ||||||
26 | to be considered normal contributions for the purposes of this |
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1 | Article. | ||||||
2 | (b) Starting September 1, 1969 and, in the case of Tier 1 | ||||||
3 | members, ending on June 30, 2014, each participating employee | ||||||
4 | shall make
additional contributions of 1/2 of 1% of earnings to | ||||||
5 | finance a portion
of the cost of the annual increases in | ||||||
6 | retirement annuity provided under
Section 15-136, except that | ||||||
7 | with respect to participants in the
self-managed plan this | ||||||
8 | additional contribution shall be used to finance the
benefits | ||||||
9 | obtained under that retirement program.
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10 | (c) In addition to the amounts described in subsections (a) | ||||||
11 | and (b) of this
Section, each participating employee shall make | ||||||
12 | contributions of 1% of earnings
applicable under this system on | ||||||
13 | and after August 1, 1959. The contributions
made under this | ||||||
14 | subsection (c) shall be considered as survivor's insurance
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15 | contributions for purposes of this Article if the employee is | ||||||
16 | covered under
the traditional benefit package, and such | ||||||
17 | contributions shall be considered
as additional contributions | ||||||
18 | for purposes of this Article if the employee is
participating | ||||||
19 | in the self-managed plan or has elected to participate in the
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20 | portable benefit package and has completed the applicable | ||||||
21 | one-year waiting
period. Contributions in excess of $80 during | ||||||
22 | any fiscal year beginning before
August 31, 1969 and in excess | ||||||
23 | of $120 during any fiscal year thereafter until
September 1, | ||||||
24 | 1971 shall be considered as additional contributions for | ||||||
25 | purposes
of this Article.
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26 | (d) If the board by board rule so permits and subject to |
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1 | such conditions
and limitations as may be specified in its | ||||||
2 | rules, a participant may make
other additional contributions of | ||||||
3 | such percentage of earnings or amounts as
the participant shall | ||||||
4 | elect in a written notice thereof received by the board.
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5 | (e) That fraction of a participant's total accumulated | ||||||
6 | normal
contributions, the numerator of which is equal to the | ||||||
7 | number of years of
service in excess of that which is required | ||||||
8 | to qualify for the maximum
retirement annuity, and the | ||||||
9 | denominator of which is equal to the total
service of the | ||||||
10 | participant, shall be considered as accumulated additional
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11 | contributions. The determination of the applicable maximum | ||||||
12 | annuity and
the adjustment in contributions required by this | ||||||
13 | provision shall be made
as of the date of the participant's | ||||||
14 | retirement.
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15 | (f) Notwithstanding the foregoing, a participating | ||||||
16 | employee shall not
be required to make contributions under this | ||||||
17 | Section after the date upon
which continuance of such | ||||||
18 | contributions would otherwise cause his or her
retirement | ||||||
19 | annuity to exceed the maximum retirement annuity as specified | ||||||
20 | in
clause (1) of subsection (c) of Section 15-136.
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21 | (g) A participant participating employee may make | ||||||
22 | contributions for the purchase of
service credit under this | ||||||
23 | Article ; however, only a participating employee may make | ||||||
24 | optional contributions under subsection (b) of Section | ||||||
25 | 15-157.1 of this Article .
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26 | (h) A Tier 2 member shall not make contributions on |
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1 | earnings that exceed the limitation as prescribed under | ||||||
2 | subsection (b) of Section 15-111 of this Article. | ||||||
3 | (Source: P.A. 98-92, eff. 7-16-13; 98-599, eff. 6-1-14 .)
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