Illinois General Assembly - Full Text of HB4427
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Full Text of HB4427  99th General Assembly

HB4427 99TH GENERAL ASSEMBLY

  
  

 


 
99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB4427

 

Introduced , by Rep. Mark Batinick - Robert F. Martwick - David Harris - Jack D. Franks, Grant Wehrli, et al.

 

SYNOPSIS AS INTRODUCED:
 
See Index

    Amends the General Assembly, State Employee, State Universities, Downstate Teachers, and Judges Articles of the Illinois Pension Code. Provides that beginning January 1, 2017, a person under one of those Articles who (i) has terminated service,(ii) is eligible to receive a retirement annuity, (iii) has not received a retirement annuity under that Article, and (iv) meets certain other eligibility requirements may elect to receive, in lieu of a retirement annuity, a lump sum accelerated pension benefit payment equal to 75% of the present value of the retirement annuity or may elect to receive a lump sum partial accelerated pension benefit payment in exchange for a specified reduction in his or her retirement annuity and all other benefits under the Article. Provides that a person may not elect a percentage reduction of retirement annuity that would result in a partial accelerated benefit payment of less than $50,000. Provides that if a person elects to receive a lump sum accelerated pension benefit payment in lieu of a retirement annuity, his or her credits and creditable service under that Article shall be terminated upon receipt of the accelerated pension benefit payment; except that the terminated service credit shall be used for the purposes of determining participation, benefits, or premiums under the State Employees Group Insurance Act of 1971. Contains provisions concerning return to service, rulemaking, qualified plan status, and new benefit increases. Amends the State Employees Group Insurance Act of 1971 to make related changes. Effective immediately.


LRB099 15486 RPS 39775 b

FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB4427LRB099 15486 RPS 39775 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 State Employees Group Insurance Act of 1971
5is amended by changing Sections 3 and 10 as follows:
 
6    (5 ILCS 375/3)  (from Ch. 127, par. 523)
7    Sec. 3. Definitions. Unless the context otherwise
8requires, the following words and phrases as used in this Act
9shall have the following meanings. The Department may define
10these and other words and phrases separately for the purpose of
11implementing specific programs providing benefits under this
12Act.
13    (a) "Administrative service organization" means any
14person, firm or corporation experienced in the handling of
15claims which is fully qualified, financially sound and capable
16of meeting the service requirements of a contract of
17administration executed with the Department.
18    (b) "Annuitant" means (1) an employee who retires, or has
19retired, on or after January 1, 1966 on an immediate annuity
20under the provisions of Articles 2 (including an employee who,
21in lieu of receiving an annuity under that Article, has elected
22to receive an accelerated pension benefit payment under Section
232-154.5 of that Article), 14 (including an employee who has

 

 

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1elected to receive an alternative retirement cancellation
2payment under Section 14-108.5 of the Illinois Pension Code in
3lieu of an annuity or who, in lieu of receiving an annuity
4under that Article, has elected to receive an accelerated
5pension benefit payment under Section 14-147.5 of that
6Article), 15 (including an employee who has retired under the
7optional retirement program established under Section 15-158.2
8or who, in lieu of receiving an annuity under that Article, has
9elected to receive an accelerated pension benefit payment under
10Section 15-185.5 of the Article), paragraphs (2), (3), or (5)
11of Section 16-106 (including an employee who, in lieu of
12receiving an annuity under that Article, has elected to receive
13an accelerated pension benefit payment under Section 16-190.5
14of the Illinois Pension Code), or Article 18 (including an
15employee who, in lieu of receiving an annuity under that
16Article, has elected to receive an accelerated pension benefit
17payment under Section 18-161.5 of that Article) of the Illinois
18Pension Code; (2) any person who was receiving group insurance
19coverage under this Act as of March 31, 1978 by reason of his
20status as an annuitant, even though the annuity in relation to
21which such coverage was provided is a proportional annuity
22based on less than the minimum period of service required for a
23retirement annuity in the system involved; (3) any person not
24otherwise covered by this Act who has retired as a
25participating member under Article 2 of the Illinois Pension
26Code but is ineligible for the retirement annuity under Section

 

 

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12-119 of the Illinois Pension Code; (4) the spouse of any
2person who is receiving a retirement annuity under Article 18
3of the Illinois Pension Code and who is covered under a group
4health insurance program sponsored by a governmental employer
5other than the State of Illinois and who has irrevocably
6elected to waive his or her coverage under this Act and to have
7his or her spouse considered as the "annuitant" under this Act
8and not as a "dependent"; or (5) an employee who retires, or
9has retired, from a qualified position, as determined according
10to rules promulgated by the Director, under a qualified local
11government, a qualified rehabilitation facility, a qualified
12domestic violence shelter or service, or a qualified child
13advocacy center. (For definition of "retired employee", see (p)
14post).
15    (b-5) (Blank).
16    (b-6) (Blank).
17    (b-7) (Blank).
18    (c) "Carrier" means (1) an insurance company, a corporation
19organized under the Limited Health Service Organization Act or
20the Voluntary Health Services Plan Act, a partnership, or other
21nongovernmental organization, which is authorized to do group
22life or group health insurance business in Illinois, or (2) the
23State of Illinois as a self-insurer.
24    (d) "Compensation" means salary or wages payable on a
25regular payroll by the State Treasurer on a warrant of the
26State Comptroller out of any State, trust or federal fund, or

 

 

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1by the Governor of the State through a disbursing officer of
2the State out of a trust or out of federal funds, or by any
3Department out of State, trust, federal or other funds held by
4the State Treasurer or the Department, to any person for
5personal services currently performed, and ordinary or
6accidental disability benefits under Articles 2, 14, 15
7(including ordinary or accidental disability benefits under
8the optional retirement program established under Section
915-158.2), paragraphs (2), (3), or (5) of Section 16-106, or
10Article 18 of the Illinois Pension Code, for disability
11incurred after January 1, 1966, or benefits payable under the
12Workers' Compensation or Occupational Diseases Act or benefits
13payable under a sick pay plan established in accordance with
14Section 36 of the State Finance Act. "Compensation" also means
15salary or wages paid to an employee of any qualified local
16government, qualified rehabilitation facility, qualified
17domestic violence shelter or service, or qualified child
18advocacy center.
19    (e) "Commission" means the State Employees Group Insurance
20Advisory Commission authorized by this Act. Commencing July 1,
211984, "Commission" as used in this Act means the Commission on
22Government Forecasting and Accountability as established by
23the Legislative Commission Reorganization Act of 1984.
24    (f) "Contributory", when referred to as contributory
25coverage, shall mean optional coverages or benefits elected by
26the member toward the cost of which such member makes

 

 

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1contribution, or which are funded in whole or in part through
2the acceptance of a reduction in earnings or the foregoing of
3an increase in earnings by an employee, as distinguished from
4noncontributory coverage or benefits which are paid entirely by
5the State of Illinois without reduction of the member's salary.
6    (g) "Department" means any department, institution, board,
7commission, officer, court or any agency of the State
8government receiving appropriations and having power to
9certify payrolls to the Comptroller authorizing payments of
10salary and wages against such appropriations as are made by the
11General Assembly from any State fund, or against trust funds
12held by the State Treasurer and includes boards of trustees of
13the retirement systems created by Articles 2, 14, 15, 16 and 18
14of the Illinois Pension Code. "Department" also includes the
15Illinois Comprehensive Health Insurance Board, the Board of
16Examiners established under the Illinois Public Accounting
17Act, and the Illinois Finance Authority.
18    (h) "Dependent", when the term is used in the context of
19the health and life plan, means a member's spouse and any child
20(1) from birth to age 26 including an adopted child, a child
21who lives with the member from the time of the filing of a
22petition for adoption until entry of an order of adoption, a
23stepchild or adjudicated child, or a child who lives with the
24member if such member is a court appointed guardian of the
25child or (2) age 19 or over who has a mental or physical
26disability from a cause originating prior to the age of 19 (age

 

 

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126 if enrolled as an adult child dependent). For the health
2plan only, the term "dependent" also includes (1) any person
3enrolled prior to the effective date of this Section who is
4dependent upon the member to the extent that the member may
5claim such person as a dependent for income tax deduction
6purposes and (2) any person who has received after June 30,
72000 an organ transplant and who is financially dependent upon
8the member and eligible to be claimed as a dependent for income
9tax purposes. A member requesting to cover any dependent must
10provide documentation as requested by the Department of Central
11Management Services and file with the Department any and all
12forms required by the Department.
13    (i) "Director" means the Director of the Illinois
14Department of Central Management Services.
15    (j) "Eligibility period" means the period of time a member
16has to elect enrollment in programs or to select benefits
17without regard to age, sex or health.
18    (k) "Employee" means and includes each officer or employee
19in the service of a department who (1) receives his
20compensation for service rendered to the department on a
21warrant issued pursuant to a payroll certified by a department
22or on a warrant or check issued and drawn by a department upon
23a trust, federal or other fund or on a warrant issued pursuant
24to a payroll certified by an elected or duly appointed officer
25of the State or who receives payment of the performance of
26personal services on a warrant issued pursuant to a payroll

 

 

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1certified by a Department and drawn by the Comptroller upon the
2State Treasurer against appropriations made by the General
3Assembly from any fund or against trust funds held by the State
4Treasurer, and (2) is employed full-time or part-time in a
5position normally requiring actual performance of duty during
6not less than 1/2 of a normal work period, as established by
7the Director in cooperation with each department, except that
8persons elected by popular vote will be considered employees
9during the entire term for which they are elected regardless of
10hours devoted to the service of the State, and (3) except that
11"employee" does not include any person who is not eligible by
12reason of such person's employment to participate in one of the
13State retirement systems under Articles 2, 14, 15 (either the
14regular Article 15 system or the optional retirement program
15established under Section 15-158.2) or 18, or under paragraph
16(2), (3), or (5) of Section 16-106, of the Illinois Pension
17Code, but such term does include persons who are employed
18during the 6 month qualifying period under Article 14 of the
19Illinois Pension Code. Such term also includes any person who
20(1) after January 1, 1966, is receiving ordinary or accidental
21disability benefits under Articles 2, 14, 15 (including
22ordinary or accidental disability benefits under the optional
23retirement program established under Section 15-158.2),
24paragraphs (2), (3), or (5) of Section 16-106, or Article 18 of
25the Illinois Pension Code, for disability incurred after
26January 1, 1966, (2) receives total permanent or total

 

 

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1temporary disability under the Workers' Compensation Act or
2Occupational Disease Act as a result of injuries sustained or
3illness contracted in the course of employment with the State
4of Illinois, or (3) is not otherwise covered under this Act and
5has retired as a participating member under Article 2 of the
6Illinois Pension Code but is ineligible for the retirement
7annuity under Section 2-119 of the Illinois Pension Code.
8However, a person who satisfies the criteria of the foregoing
9definition of "employee" except that such person is made
10ineligible to participate in the State Universities Retirement
11System by clause (4) of subsection (a) of Section 15-107 of the
12Illinois Pension Code is also an "employee" for the purposes of
13this Act. "Employee" also includes any person receiving or
14eligible for benefits under a sick pay plan established in
15accordance with Section 36 of the State Finance Act. "Employee"
16also includes (i) each officer or employee in the service of a
17qualified local government, including persons appointed as
18trustees of sanitary districts regardless of hours devoted to
19the service of the sanitary district, (ii) each employee in the
20service of a qualified rehabilitation facility, (iii) each
21full-time employee in the service of a qualified domestic
22violence shelter or service, and (iv) each full-time employee
23in the service of a qualified child advocacy center, as
24determined according to rules promulgated by the Director.
25    (l) "Member" means an employee, annuitant, retired
26employee or survivor. In the case of an annuitant or retired

 

 

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1employee who first becomes an annuitant or retired employee on
2or after the effective date of this amendatory Act of the 97th
3General Assembly, the individual must meet the minimum vesting
4requirements of the applicable retirement system in order to be
5eligible for group insurance benefits under that system. In the
6case of a survivor who first becomes a survivor on or after the
7effective date of this amendatory Act of the 97th General
8Assembly, the deceased employee, annuitant, or retired
9employee upon whom the annuity is based must have been eligible
10to participate in the group insurance system under the
11applicable retirement system in order for the survivor to be
12eligible for group insurance benefits under that system.
13    (m) "Optional coverages or benefits" means those coverages
14or benefits available to the member on his or her voluntary
15election, and at his or her own expense.
16    (n) "Program" means the group life insurance, health
17benefits and other employee benefits designed and contracted
18for by the Director under this Act.
19    (o) "Health plan" means a health benefits program offered
20by the State of Illinois for persons eligible for the plan.
21    (p) "Retired employee" means any person who would be an
22annuitant as that term is defined herein but for the fact that
23such person retired prior to January 1, 1966. Such term also
24includes any person formerly employed by the University of
25Illinois in the Cooperative Extension Service who would be an
26annuitant but for the fact that such person was made ineligible

 

 

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1to participate in the State Universities Retirement System by
2clause (4) of subsection (a) of Section 15-107 of the Illinois
3Pension Code.
4    (q) "Survivor" means a person receiving an annuity as a
5survivor of an employee or of an annuitant. "Survivor" also
6includes: (1) the surviving dependent of a person who satisfies
7the definition of "employee" except that such person is made
8ineligible to participate in the State Universities Retirement
9System by clause (4) of subsection (a) of Section 15-107 of the
10Illinois Pension Code; (2) the surviving dependent of any
11person formerly employed by the University of Illinois in the
12Cooperative Extension Service who would be an annuitant except
13for the fact that such person was made ineligible to
14participate in the State Universities Retirement System by
15clause (4) of subsection (a) of Section 15-107 of the Illinois
16Pension Code; and (3) the surviving dependent of a person who
17was an annuitant under this Act by virtue of receiving an
18alternative retirement cancellation payment under Section
1914-108.5 of the Illinois Pension Code.
20    (q-2) "SERS" means the State Employees' Retirement System
21of Illinois, created under Article 14 of the Illinois Pension
22Code.
23    (q-3) "SURS" means the State Universities Retirement
24System, created under Article 15 of the Illinois Pension Code.
25    (q-4) "TRS" means the Teachers' Retirement System of the
26State of Illinois, created under Article 16 of the Illinois

 

 

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1Pension Code.
2    (q-5) (Blank).
3    (q-6) (Blank).
4    (q-7) (Blank).
5    (r) "Medical services" means the services provided within
6the scope of their licenses by practitioners in all categories
7licensed under the Medical Practice Act of 1987.
8    (s) "Unit of local government" means any county,
9municipality, township, school district (including a
10combination of school districts under the Intergovernmental
11Cooperation Act), special district or other unit, designated as
12a unit of local government by law, which exercises limited
13governmental powers or powers in respect to limited
14governmental subjects, any not-for-profit association with a
15membership that primarily includes townships and township
16officials, that has duties that include provision of research
17service, dissemination of information, and other acts for the
18purpose of improving township government, and that is funded
19wholly or partly in accordance with Section 85-15 of the
20Township Code; any not-for-profit corporation or association,
21with a membership consisting primarily of municipalities, that
22operates its own utility system, and provides research,
23training, dissemination of information, or other acts to
24promote cooperation between and among municipalities that
25provide utility services and for the advancement of the goals
26and purposes of its membership; the Southern Illinois

 

 

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1Collegiate Common Market, which is a consortium of higher
2education institutions in Southern Illinois; the Illinois
3Association of Park Districts; and any hospital provider that
4is owned by a county that has 100 or fewer hospital beds and
5has not already joined the program. "Qualified local
6government" means a unit of local government approved by the
7Director and participating in a program created under
8subsection (i) of Section 10 of this Act.
9    (t) "Qualified rehabilitation facility" means any
10not-for-profit organization that is accredited by the
11Commission on Accreditation of Rehabilitation Facilities or
12certified by the Department of Human Services (as successor to
13the Department of Mental Health and Developmental
14Disabilities) to provide services to persons with disabilities
15and which receives funds from the State of Illinois for
16providing those services, approved by the Director and
17participating in a program created under subsection (j) of
18Section 10 of this Act.
19    (u) "Qualified domestic violence shelter or service" means
20any Illinois domestic violence shelter or service and its
21administrative offices funded by the Department of Human
22Services (as successor to the Illinois Department of Public
23Aid), approved by the Director and participating in a program
24created under subsection (k) of Section 10.
25    (v) "TRS benefit recipient" means a person who:
26        (1) is not a "member" as defined in this Section; and

 

 

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1        (2) is receiving a monthly benefit or retirement
2    annuity under Article 16 of the Illinois Pension Code; and
3        (3) either (i) has at least 8 years of creditable
4    service under Article 16 of the Illinois Pension Code, or
5    (ii) was enrolled in the health insurance program offered
6    under that Article on January 1, 1996, or (iii) is the
7    survivor of a benefit recipient who had at least 8 years of
8    creditable service under Article 16 of the Illinois Pension
9    Code or was enrolled in the health insurance program
10    offered under that Article on the effective date of this
11    amendatory Act of 1995, or (iv) is a recipient or survivor
12    of a recipient of a disability benefit under Article 16 of
13    the Illinois Pension Code.
14    (w) "TRS dependent beneficiary" means a person who:
15        (1) is not a "member" or "dependent" as defined in this
16    Section; and
17        (2) is a TRS benefit recipient's: (A) spouse, (B)
18    dependent parent who is receiving at least half of his or
19    her support from the TRS benefit recipient, or (C) natural,
20    step, adjudicated, or adopted child who is (i) under age
21    26, (ii) was, on January 1, 1996, participating as a
22    dependent beneficiary in the health insurance program
23    offered under Article 16 of the Illinois Pension Code, or
24    (iii) age 19 or over who has a mental or physical
25    disability from a cause originating prior to the age of 19
26    (age 26 if enrolled as an adult child).

 

 

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1    "TRS dependent beneficiary" does not include, as indicated
2under paragraph (2) of this subsection (w), a dependent of the
3survivor of a TRS benefit recipient who first becomes a
4dependent of a survivor of a TRS benefit recipient on or after
5the effective date of this amendatory Act of the 97th General
6Assembly unless that dependent would have been eligible for
7coverage as a dependent of the deceased TRS benefit recipient
8upon whom the survivor benefit is based.
9    (x) "Military leave" refers to individuals in basic
10training for reserves, special/advanced training, annual
11training, emergency call up, activation by the President of the
12United States, or any other training or duty in service to the
13United States Armed Forces.
14    (y) (Blank).
15    (z) "Community college benefit recipient" means a person
16who:
17        (1) is not a "member" as defined in this Section; and
18        (2) is receiving a monthly survivor's annuity or
19    retirement annuity under Article 15 of the Illinois Pension
20    Code; and
21        (3) either (i) was a full-time employee of a community
22    college district or an association of community college
23    boards created under the Public Community College Act
24    (other than an employee whose last employer under Article
25    15 of the Illinois Pension Code was a community college
26    district subject to Article VII of the Public Community

 

 

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1    College Act) and was eligible to participate in a group
2    health benefit plan as an employee during the time of
3    employment with a community college district (other than a
4    community college district subject to Article VII of the
5    Public Community College Act) or an association of
6    community college boards, or (ii) is the survivor of a
7    person described in item (i).
8    (aa) "Community college dependent beneficiary" means a
9person who:
10        (1) is not a "member" or "dependent" as defined in this
11    Section; and
12        (2) is a community college benefit recipient's: (A)
13    spouse, (B) dependent parent who is receiving at least half
14    of his or her support from the community college benefit
15    recipient, or (C) natural, step, adjudicated, or adopted
16    child who is (i) under age 26, or (ii) age 19 or over and
17    has a mental or physical disability from a cause
18    originating prior to the age of 19 (age 26 if enrolled as
19    an adult child).
20    "Community college dependent beneficiary" does not
21include, as indicated under paragraph (2) of this subsection
22(aa), a dependent of the survivor of a community college
23benefit recipient who first becomes a dependent of a survivor
24of a community college benefit recipient on or after the
25effective date of this amendatory Act of the 97th General
26Assembly unless that dependent would have been eligible for

 

 

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1coverage as a dependent of the deceased community college
2benefit recipient upon whom the survivor annuity is based.
3    (bb) "Qualified child advocacy center" means any Illinois
4child advocacy center and its administrative offices funded by
5the Department of Children and Family Services, as defined by
6the Children's Advocacy Center Act (55 ILCS 80/), approved by
7the Director and participating in a program created under
8subsection (n) of Section 10.
9(Source: P.A. 98-488, eff. 8-16-13; 99-143, eff. 7-27-15.)
 
10    (5 ILCS 375/10)  (from Ch. 127, par. 530)
11    Sec. 10. Contributions by the State and members.
12    (a) The State shall pay the cost of basic non-contributory
13group life insurance and, subject to member paid contributions
14set by the Department or required by this Section and except as
15provided in this Section, the basic program of group health
16benefits on each eligible member, except a member, not
17otherwise covered by this Act, who has retired as a
18participating member under Article 2 of the Illinois Pension
19Code but is ineligible for the retirement annuity under Section
202-119 of the Illinois Pension Code, and part of each eligible
21member's and retired member's premiums for health insurance
22coverage for enrolled dependents as provided by Section 9. The
23State shall pay the cost of the basic program of group health
24benefits only after benefits are reduced by the amount of
25benefits covered by Medicare for all members and dependents who

 

 

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1are eligible for benefits under Social Security or the Railroad
2Retirement system or who had sufficient Medicare-covered
3government employment, except that such reduction in benefits
4shall apply only to those members and dependents who (1) first
5become eligible for such Medicare coverage on or after July 1,
61992; or (2) are Medicare-eligible members or dependents of a
7local government unit which began participation in the program
8on or after July 1, 1992; or (3) remain eligible for, but no
9longer receive Medicare coverage which they had been receiving
10on or after July 1, 1992. The Department may determine the
11aggregate level of the State's contribution on the basis of
12actual cost of medical services adjusted for age, sex or
13geographic or other demographic characteristics which affect
14the costs of such programs.
15    The cost of participation in the basic program of group
16health benefits for the dependent or survivor of a living or
17deceased retired employee who was formerly employed by the
18University of Illinois in the Cooperative Extension Service and
19would be an annuitant but for the fact that he or she was made
20ineligible to participate in the State Universities Retirement
21System by clause (4) of subsection (a) of Section 15-107 of the
22Illinois Pension Code shall not be greater than the cost of
23participation that would otherwise apply to that dependent or
24survivor if he or she were the dependent or survivor of an
25annuitant under the State Universities Retirement System.
26    (a-1) (Blank).

 

 

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1    (a-2) (Blank).
2    (a-3) (Blank).
3    (a-4) (Blank).
4    (a-5) (Blank).
5    (a-6) (Blank).
6    (a-7) (Blank).
7    (a-8) Any annuitant, survivor, or retired employee may
8waive or terminate coverage in the program of group health
9benefits. Any such annuitant, survivor, or retired employee who
10has waived or terminated coverage may enroll or re-enroll in
11the program of group health benefits only during the annual
12benefit choice period, as determined by the Director; except
13that in the event of termination of coverage due to nonpayment
14of premiums, the annuitant, survivor, or retired employee may
15not re-enroll in the program.
16    (a-8.5) Beginning on the effective date of this amendatory
17Act of the 97th General Assembly, the Director of Central
18Management Services shall, on an annual basis, determine the
19amount that the State shall contribute toward the basic program
20of group health benefits on behalf of annuitants (including
21individuals who (i) participated in the General Assembly
22Retirement System, the State Employees' Retirement System of
23Illinois, the State Universities Retirement System, the
24Teachers' Retirement System of the State of Illinois, or the
25Judges Retirement System of Illinois and (ii) qualify as
26annuitants under subsection (b) of Section 3 of this Act),

 

 

HB4427- 19 -LRB099 15486 RPS 39775 b

1survivors (including individuals who (i) receive an annuity as
2a survivor of an individual who participated in the General
3Assembly Retirement System, the State Employees' Retirement
4System of Illinois, the State Universities Retirement System,
5the Teachers' Retirement System of the State of Illinois, or
6the Judges Retirement System of Illinois and (ii) qualify as
7survivors under subsection (q) of Section 3 of this Act), and
8retired employees (as defined in subsection (p) of Section 3 of
9this Act). The remainder of the cost of coverage for each
10annuitant, survivor, or retired employee, as determined by the
11Director of Central Management Services, shall be the
12responsibility of that annuitant, survivor, or retired
13employee.
14    Contributions required of annuitants, survivors, and
15retired employees shall be the same for all retirement systems
16and shall also be based on whether an individual has made an
17election under Section 15-135.1 of the Illinois Pension Code.
18Contributions may be based on annuitants', survivors', or
19retired employees' Medicare eligibility, but may not be based
20on Social Security eligibility.
21    (a-9) No later than May 1 of each calendar year, the
22Director of Central Management Services shall certify in
23writing to the Executive Secretary of the State Employees'
24Retirement System of Illinois the amounts of the Medicare
25supplement health care premiums and the amounts of the health
26care premiums for all other retirees who are not Medicare

 

 

HB4427- 20 -LRB099 15486 RPS 39775 b

1eligible.
2    A separate calculation of the premiums based upon the
3actual cost of each health care plan shall be so certified.
4    The Director of Central Management Services shall provide
5to the Executive Secretary of the State Employees' Retirement
6System of Illinois such information, statistics, and other data
7as he or she may require to review the premium amounts
8certified by the Director of Central Management Services.
9    The Department of Central Management Services, or any
10successor agency designated to procure healthcare contracts
11pursuant to this Act, is authorized to establish funds,
12separate accounts provided by any bank or banks as defined by
13the Illinois Banking Act, or separate accounts provided by any
14savings and loan association or associations as defined by the
15Illinois Savings and Loan Act of 1985 to be held by the
16Director, outside the State treasury, for the purpose of
17receiving the transfer of moneys from the Local Government
18Health Insurance Reserve Fund. The Department may promulgate
19rules further defining the methodology for the transfers. Any
20interest earned by moneys in the funds or accounts shall inure
21to the Local Government Health Insurance Reserve Fund. The
22transferred moneys, and interest accrued thereon, shall be used
23exclusively for transfers to administrative service
24organizations or their financial institutions for payments of
25claims to claimants and providers under the self-insurance
26health plan. The transferred moneys, and interest accrued

 

 

HB4427- 21 -LRB099 15486 RPS 39775 b

1thereon, shall not be used for any other purpose including, but
2not limited to, reimbursement of administration fees due the
3administrative service organization pursuant to its contract
4or contracts with the Department.
5    (a-10) To the extent that participation, benefits, or
6premiums under this Act are based on a person's service credit
7under an Article of the Illinois Pension Code, service credit
8terminated in exchange for an accelerated pension benefit
9payment under Section 2-154.5, 14-147.5, 15-185.5, 16-190.5,
10or 18-161.5 of that Code shall be included in determining a
11person's service credit for the purposes of this Act.
12    (b) State employees who become eligible for this program on
13or after January 1, 1980 in positions normally requiring actual
14performance of duty not less than 1/2 of a normal work period
15but not equal to that of a normal work period, shall be given
16the option of participating in the available program. If the
17employee elects coverage, the State shall contribute on behalf
18of such employee to the cost of the employee's benefit and any
19applicable dependent supplement, that sum which bears the same
20percentage as that percentage of time the employee regularly
21works when compared to normal work period.
22    (c) The basic non-contributory coverage from the basic
23program of group health benefits shall be continued for each
24employee not in pay status or on active service by reason of
25(1) leave of absence due to illness or injury, (2) authorized
26educational leave of absence or sabbatical leave, or (3)

 

 

HB4427- 22 -LRB099 15486 RPS 39775 b

1military leave. This coverage shall continue until expiration
2of authorized leave and return to active service, but not to
3exceed 24 months for leaves under item (1) or (2). This
424-month limitation and the requirement of returning to active
5service shall not apply to persons receiving ordinary or
6accidental disability benefits or retirement benefits through
7the appropriate State retirement system or benefits under the
8Workers' Compensation or Occupational Disease Act.
9    (d) The basic group life insurance coverage shall continue,
10with full State contribution, where such person is (1) absent
11from active service by reason of disability arising from any
12cause other than self-inflicted, (2) on authorized educational
13leave of absence or sabbatical leave, or (3) on military leave.
14    (e) Where the person is in non-pay status for a period in
15excess of 30 days or on leave of absence, other than by reason
16of disability, educational or sabbatical leave, or military
17leave, such person may continue coverage only by making
18personal payment equal to the amount normally contributed by
19the State on such person's behalf. Such payments and coverage
20may be continued: (1) until such time as the person returns to
21a status eligible for coverage at State expense, but not to
22exceed 24 months or (2) until such person's employment or
23annuitant status with the State is terminated (exclusive of any
24additional service imposed pursuant to law).
25    (f) The Department shall establish by rule the extent to
26which other employee benefits will continue for persons in

 

 

HB4427- 23 -LRB099 15486 RPS 39775 b

1non-pay status or who are not in active service.
2    (g) The State shall not pay the cost of the basic
3non-contributory group life insurance, program of health
4benefits and other employee benefits for members who are
5survivors as defined by paragraphs (1) and (2) of subsection
6(q) of Section 3 of this Act. The costs of benefits for these
7survivors shall be paid by the survivors or by the University
8of Illinois Cooperative Extension Service, or any combination
9thereof. However, the State shall pay the amount of the
10reduction in the cost of participation, if any, resulting from
11the amendment to subsection (a) made by this amendatory Act of
12the 91st General Assembly.
13    (h) Those persons occupying positions with any department
14as a result of emergency appointments pursuant to Section 8b.8
15of the Personnel Code who are not considered employees under
16this Act shall be given the option of participating in the
17programs of group life insurance, health benefits and other
18employee benefits. Such persons electing coverage may
19participate only by making payment equal to the amount normally
20contributed by the State for similarly situated employees. Such
21amounts shall be determined by the Director. Such payments and
22coverage may be continued until such time as the person becomes
23an employee pursuant to this Act or such person's appointment
24is terminated.
25    (i) Any unit of local government within the State of
26Illinois may apply to the Director to have its employees,

 

 

HB4427- 24 -LRB099 15486 RPS 39775 b

1annuitants, and their dependents provided group health
2coverage under this Act on a non-insured basis. To participate,
3a unit of local government must agree to enroll all of its
4employees, who may select coverage under either the State group
5health benefits plan or a health maintenance organization that
6has contracted with the State to be available as a health care
7provider for employees as defined in this Act. A unit of local
8government must remit the entire cost of providing coverage
9under the State group health benefits plan or, for coverage
10under a health maintenance organization, an amount determined
11by the Director based on an analysis of the sex, age,
12geographic location, or other relevant demographic variables
13for its employees, except that the unit of local government
14shall not be required to enroll those of its employees who are
15covered spouses or dependents under this plan or another group
16policy or plan providing health benefits as long as (1) an
17appropriate official from the unit of local government attests
18that each employee not enrolled is a covered spouse or
19dependent under this plan or another group policy or plan, and
20(2) at least 50% of the employees are enrolled and the unit of
21local government remits the entire cost of providing coverage
22to those employees, except that a participating school district
23must have enrolled at least 50% of its full-time employees who
24have not waived coverage under the district's group health plan
25by participating in a component of the district's cafeteria
26plan. A participating school district is not required to enroll

 

 

HB4427- 25 -LRB099 15486 RPS 39775 b

1a full-time employee who has waived coverage under the
2district's health plan, provided that an appropriate official
3from the participating school district attests that the
4full-time employee has waived coverage by participating in a
5component of the district's cafeteria plan. For the purposes of
6this subsection, "participating school district" includes a
7unit of local government whose primary purpose is education as
8defined by the Department's rules.
9    Employees of a participating unit of local government who
10are not enrolled due to coverage under another group health
11policy or plan may enroll in the event of a qualifying change
12in status, special enrollment, special circumstance as defined
13by the Director, or during the annual Benefit Choice Period. A
14participating unit of local government may also elect to cover
15its annuitants. Dependent coverage shall be offered on an
16optional basis, with the costs paid by the unit of local
17government, its employees, or some combination of the two as
18determined by the unit of local government. The unit of local
19government shall be responsible for timely collection and
20transmission of dependent premiums.
21    The Director shall annually determine monthly rates of
22payment, subject to the following constraints:
23        (1) In the first year of coverage, the rates shall be
24    equal to the amount normally charged to State employees for
25    elected optional coverages or for enrolled dependents
26    coverages or other contributory coverages, or contributed

 

 

HB4427- 26 -LRB099 15486 RPS 39775 b

1    by the State for basic insurance coverages on behalf of its
2    employees, adjusted for differences between State
3    employees and employees of the local government in age,
4    sex, geographic location or other relevant demographic
5    variables, plus an amount sufficient to pay for the
6    additional administrative costs of providing coverage to
7    employees of the unit of local government and their
8    dependents.
9        (2) In subsequent years, a further adjustment shall be
10    made to reflect the actual prior years' claims experience
11    of the employees of the unit of local government.
12    In the case of coverage of local government employees under
13a health maintenance organization, the Director shall annually
14determine for each participating unit of local government the
15maximum monthly amount the unit may contribute toward that
16coverage, based on an analysis of (i) the age, sex, geographic
17location, and other relevant demographic variables of the
18unit's employees and (ii) the cost to cover those employees
19under the State group health benefits plan. The Director may
20similarly determine the maximum monthly amount each unit of
21local government may contribute toward coverage of its
22employees' dependents under a health maintenance organization.
23    Monthly payments by the unit of local government or its
24employees for group health benefits plan or health maintenance
25organization coverage shall be deposited in the Local
26Government Health Insurance Reserve Fund.

 

 

HB4427- 27 -LRB099 15486 RPS 39775 b

1    The Local Government Health Insurance Reserve Fund is
2hereby created as a nonappropriated trust fund to be held
3outside the State Treasury, with the State Treasurer as
4custodian. The Local Government Health Insurance Reserve Fund
5shall be a continuing fund not subject to fiscal year
6limitations. The Local Government Health Insurance Reserve
7Fund is not subject to administrative charges or charge-backs,
8including but not limited to those authorized under Section 8h
9of the State Finance Act. All revenues arising from the
10administration of the health benefits program established
11under this Section shall be deposited into the Local Government
12Health Insurance Reserve Fund. Any interest earned on moneys in
13the Local Government Health Insurance Reserve Fund shall be
14deposited into the Fund. All expenditures from this Fund shall
15be used for payments for health care benefits for local
16government and rehabilitation facility employees, annuitants,
17and dependents, and to reimburse the Department or its
18administrative service organization for all expenses incurred
19in the administration of benefits. No other State funds may be
20used for these purposes.
21    A local government employer's participation or desire to
22participate in a program created under this subsection shall
23not limit that employer's duty to bargain with the
24representative of any collective bargaining unit of its
25employees.
26    (j) Any rehabilitation facility within the State of

 

 

HB4427- 28 -LRB099 15486 RPS 39775 b

1Illinois may apply to the Director to have its employees,
2annuitants, and their eligible dependents provided group
3health coverage under this Act on a non-insured basis. To
4participate, a rehabilitation facility must agree to enroll all
5of its employees and remit the entire cost of providing such
6coverage for its employees, except that the rehabilitation
7facility shall not be required to enroll those of its employees
8who are covered spouses or dependents under this plan or
9another group policy or plan providing health benefits as long
10as (1) an appropriate official from the rehabilitation facility
11attests that each employee not enrolled is a covered spouse or
12dependent under this plan or another group policy or plan, and
13(2) at least 50% of the employees are enrolled and the
14rehabilitation facility remits the entire cost of providing
15coverage to those employees. Employees of a participating
16rehabilitation facility who are not enrolled due to coverage
17under another group health policy or plan may enroll in the
18event of a qualifying change in status, special enrollment,
19special circumstance as defined by the Director, or during the
20annual Benefit Choice Period. A participating rehabilitation
21facility may also elect to cover its annuitants. Dependent
22coverage shall be offered on an optional basis, with the costs
23paid by the rehabilitation facility, its employees, or some
24combination of the 2 as determined by the rehabilitation
25facility. The rehabilitation facility shall be responsible for
26timely collection and transmission of dependent premiums.

 

 

HB4427- 29 -LRB099 15486 RPS 39775 b

1    The Director shall annually determine quarterly rates of
2payment, subject to the following constraints:
3        (1) In the first year of coverage, the rates shall be
4    equal to the amount normally charged to State employees for
5    elected optional coverages or for enrolled dependents
6    coverages or other contributory coverages on behalf of its
7    employees, adjusted for differences between State
8    employees and employees of the rehabilitation facility in
9    age, sex, geographic location or other relevant
10    demographic variables, plus an amount sufficient to pay for
11    the additional administrative costs of providing coverage
12    to employees of the rehabilitation facility and their
13    dependents.
14        (2) In subsequent years, a further adjustment shall be
15    made to reflect the actual prior years' claims experience
16    of the employees of the rehabilitation facility.
17    Monthly payments by the rehabilitation facility or its
18employees for group health benefits shall be deposited in the
19Local Government Health Insurance Reserve Fund.
20    (k) Any domestic violence shelter or service within the
21State of Illinois may apply to the Director to have its
22employees, annuitants, and their dependents provided group
23health coverage under this Act on a non-insured basis. To
24participate, a domestic violence shelter or service must agree
25to enroll all of its employees and pay the entire cost of
26providing such coverage for its employees. The domestic

 

 

HB4427- 30 -LRB099 15486 RPS 39775 b

1violence shelter shall not be required to enroll those of its
2employees who are covered spouses or dependents under this plan
3or another group policy or plan providing health benefits as
4long as (1) an appropriate official from the domestic violence
5shelter attests that each employee not enrolled is a covered
6spouse or dependent under this plan or another group policy or
7plan and (2) at least 50% of the employees are enrolled and the
8domestic violence shelter remits the entire cost of providing
9coverage to those employees. Employees of a participating
10domestic violence shelter who are not enrolled due to coverage
11under another group health policy or plan may enroll in the
12event of a qualifying change in status, special enrollment, or
13special circumstance as defined by the Director or during the
14annual Benefit Choice Period. A participating domestic
15violence shelter may also elect to cover its annuitants.
16Dependent coverage shall be offered on an optional basis, with
17employees, or some combination of the 2 as determined by the
18domestic violence shelter or service. The domestic violence
19shelter or service shall be responsible for timely collection
20and transmission of dependent premiums.
21    The Director shall annually determine rates of payment,
22subject to the following constraints:
23        (1) In the first year of coverage, the rates shall be
24    equal to the amount normally charged to State employees for
25    elected optional coverages or for enrolled dependents
26    coverages or other contributory coverages on behalf of its

 

 

HB4427- 31 -LRB099 15486 RPS 39775 b

1    employees, adjusted for differences between State
2    employees and employees of the domestic violence shelter or
3    service in age, sex, geographic location or other relevant
4    demographic variables, plus an amount sufficient to pay for
5    the additional administrative costs of providing coverage
6    to employees of the domestic violence shelter or service
7    and their dependents.
8        (2) In subsequent years, a further adjustment shall be
9    made to reflect the actual prior years' claims experience
10    of the employees of the domestic violence shelter or
11    service.
12    Monthly payments by the domestic violence shelter or
13service or its employees for group health insurance shall be
14deposited in the Local Government Health Insurance Reserve
15Fund.
16    (l) A public community college or entity organized pursuant
17to the Public Community College Act may apply to the Director
18initially to have only annuitants not covered prior to July 1,
191992 by the district's health plan provided health coverage
20under this Act on a non-insured basis. The community college
21must execute a 2-year contract to participate in the Local
22Government Health Plan. Any annuitant may enroll in the event
23of a qualifying change in status, special enrollment, special
24circumstance as defined by the Director, or during the annual
25Benefit Choice Period.
26    The Director shall annually determine monthly rates of

 

 

HB4427- 32 -LRB099 15486 RPS 39775 b

1payment subject to the following constraints: for those
2community colleges with annuitants only enrolled, first year
3rates shall be equal to the average cost to cover claims for a
4State member adjusted for demographics, Medicare
5participation, and other factors; and in the second year, a
6further adjustment of rates shall be made to reflect the actual
7first year's claims experience of the covered annuitants.
8    (l-5) The provisions of subsection (l) become inoperative
9on July 1, 1999.
10    (m) The Director shall adopt any rules deemed necessary for
11implementation of this amendatory Act of 1989 (Public Act
1286-978).
13    (n) Any child advocacy center within the State of Illinois
14may apply to the Director to have its employees, annuitants,
15and their dependents provided group health coverage under this
16Act on a non-insured basis. To participate, a child advocacy
17center must agree to enroll all of its employees and pay the
18entire cost of providing coverage for its employees. The child
19advocacy center shall not be required to enroll those of its
20employees who are covered spouses or dependents under this plan
21or another group policy or plan providing health benefits as
22long as (1) an appropriate official from the child advocacy
23center attests that each employee not enrolled is a covered
24spouse or dependent under this plan or another group policy or
25plan and (2) at least 50% of the employees are enrolled and the
26child advocacy center remits the entire cost of providing

 

 

HB4427- 33 -LRB099 15486 RPS 39775 b

1coverage to those employees. Employees of a participating child
2advocacy center who are not enrolled due to coverage under
3another group health policy or plan may enroll in the event of
4a qualifying change in status, special enrollment, or special
5circumstance as defined by the Director or during the annual
6Benefit Choice Period. A participating child advocacy center
7may also elect to cover its annuitants. Dependent coverage
8shall be offered on an optional basis, with the costs paid by
9the child advocacy center, its employees, or some combination
10of the 2 as determined by the child advocacy center. The child
11advocacy center shall be responsible for timely collection and
12transmission of dependent premiums.
13    The Director shall annually determine rates of payment,
14subject to the following constraints:
15        (1) In the first year of coverage, the rates shall be
16    equal to the amount normally charged to State employees for
17    elected optional coverages or for enrolled dependents
18    coverages or other contributory coverages on behalf of its
19    employees, adjusted for differences between State
20    employees and employees of the child advocacy center in
21    age, sex, geographic location, or other relevant
22    demographic variables, plus an amount sufficient to pay for
23    the additional administrative costs of providing coverage
24    to employees of the child advocacy center and their
25    dependents.
26        (2) In subsequent years, a further adjustment shall be

 

 

HB4427- 34 -LRB099 15486 RPS 39775 b

1    made to reflect the actual prior years' claims experience
2    of the employees of the child advocacy center.
3    Monthly payments by the child advocacy center or its
4employees for group health insurance shall be deposited into
5the Local Government Health Insurance Reserve Fund.
6(Source: P.A. 97-695, eff. 7-1-12; 98-488, eff. 8-16-13.)
 
7    Section 10. The Illinois Pension Code is amended by adding
8Sections 2-154.5, 2-154.6, 14-147.5, 14-147.6, 15-185.5,
915-185.6, 16-190.5, 16-190.6, 18-161.5, and 18-161.6 and
10amending Sections 2-162, 14-152.1, 15-198, 16-203, and 18-169
11as follows:
 
12    (40 ILCS 5/2-154.5 new)
13    Sec. 2-154.5. Accelerated pension benefit payment.
14    (a) To be eligible for an accelerated pension benefit
15payment provided in this Section, a person must:
16        (1) have terminated service;
17        (2) be eligible to receive a retirement annuity under
18    this Article;
19        (3) not have received any retirement annuity under this
20    Article;
21        (4) not have a QILDRO in effect against him or her
22    under this Article; and
23        (5) not have elected to receive a partial accelerated
24    pension benefit payment under Section 2-154.6.

 

 

HB4427- 35 -LRB099 15486 RPS 39775 b

1    Beginning January 1, 2017, an eligible person may make a
2written election with the System to receive an accelerated
3pension benefit payment in lieu of a retirement annuity.
4    A person who elects to receive an accelerated pension
5benefit payment under this Section may not elect to proceed
6under the Retirement Systems Reciprocal Act with respect to
7service under this Article.
8    (b) The accelerated pension benefit payment under this
9Section shall be a one-time lump sum payment in an amount equal
10to 75% of the present value of the greatest retirement annuity
11to which the eligible person is entitled at the date of the
12election (including any anticipated annual increases but
13disregarding any survivor benefits), as calculated by the
14System using the actuarial tables and other assumptions adopted
15by the Board.
16    (c) A person's credits and creditable service under this
17Article shall be terminated upon the person's receipt of an
18accelerated pension benefit payment under this Section, and no
19other benefit shall be paid under this Article based on those
20terminated credits and creditable service, including any
21retirement, survivor, or other benefit; except that to the
22extent that participation, benefits, or premiums under the
23State Employees Group Insurance Act of 1971 are based on the
24amount of service credit, the terminated service credit shall
25be used for that purpose.
26    (d) If a person who has received an accelerated pension

 

 

HB4427- 36 -LRB099 15486 RPS 39775 b

1benefit payment under this Section returns to active service
2under this Article, then:
3        (1) Any benefits under the System earned as a result of
4    that return to active service shall be based solely on the
5    person's credits and creditable service arising from the
6    return to active service.
7        (2) The accelerated pension benefit payment may not be
8    repaid to the System, and the terminated credits and
9    creditable service may not under any circumstances be
10    reinstated.
11    (e) The accelerated pension benefit payment under this
12Section may be subject to withholding or payment of applicable
13taxes, but to the extent permitted by federal law, a person who
14receives an accelerated pension benefit payment under this
15Section may direct the System to pay all or a portion of that
16payment as a rollover into another retirement plan or account
17qualified under the Internal Revenue Code of 1986, as amended.
18    (f) The Board shall adopt any rules necessary to implement
19this Section.
20    (g) No provision of this Section shall be interpreted in a
21way that would cause the applicable System to cease to be a
22qualified plan under the Internal Revenue Code of 1986.
 
23    (40 ILCS 5/2-154.6 new)
24    Sec. 2-154.6. Partial accelerated pension benefit payment.
25    (a) To be eligible for a partial accelerated pension

 

 

HB4427- 37 -LRB099 15486 RPS 39775 b

1benefit payment provided in this Section, a person must:
2        (1) have terminated service;
3        (2) be eligible to receive a retirement annuity under
4    this Article;
5        (3) not have received any retirement annuity under this
6    Article;
7        (4) not have a QILDRO in effect against him or her
8    under this Article; and
9        (5) not have elected to receive an accelerated pension
10    benefit payment under Section 2-154.5.
11    Beginning January 1, 2017, an eligible person may make a
12written election with the System to receive a partial
13accelerated pension benefit payment in exchange for a reduction
14in his or her retirement annuity and all other benefits under
15this Article, including, but not limited to, survivors
16benefits. In the written election, the eligible person shall
17specify the percentage by which the retirement annuity shall be
18reduced; however, a person may not elect a percentage reduction
19of his or her retirement annuity and all other benefits under
20this Article that would result in a partial accelerated pension
21benefit payment of less than $50,000.
22    Before providing the partial accelerated pension benefit
23payment under this Section to a person, the System shall notify
24that person if the percentage elected for the reduction in his
25or her retirement annuity and all other benefits under this
26Article would result in any applicable benefit being less than

 

 

HB4427- 38 -LRB099 15486 RPS 39775 b

1the minimum amount specified for that benefit in this Article,
2and the eligible person shall be provided the opportunity to
3change the amount of his or her election.
4    A person who elects to receive a partial accelerated
5pension benefit payment under this Section may not elect to
6proceed under the Retirement Systems Reciprocal Act with
7respect to service under this Article.
8    (b) The partial accelerated pension benefit payment under
9this Section shall be a one-time lump sum payment in an amount
10equal to 75% of the elected percentage. For the purposes of
11this Section, "elected percentage" means the percentage, as
12specified in the eligible person's written election, of the
13present value of the greatest retirement annuity to which the
14eligible person is entitled at the date of the election
15(including any anticipated annual increases but disregarding
16any survivor benefits), which shall be calculated by the System
17using the actuarial tables and other assumptions adopted by the
18Board.
19    A person who receives the partial accelerated pension
20benefit payment shall have the amount of his or her retirement
21annuity and all other benefits under this Article, including,
22but not limited to, survivors benefits, reduced by the
23percentage specified in that person's written election.
24    (c) The percentage reduction in retirement annuity and all
25other benefits under this Article may not under any
26circumstances be modified after the partial accelerated

 

 

HB4427- 39 -LRB099 15486 RPS 39775 b

1pension benefit payment under this Section is received.
2Notwithstanding any provision of this Article to the contrary,
3a person who elects to receive a partial accelerated pension
4benefit payment that results in an applicable benefit being
5less than the minimum amount specified for that benefit in this
6Article shall not be entitled to receive that minimum amount.
7    (d) If a person who has received a partial accelerated
8pension benefit payment under this Section returns to active
9service under this Article, then:
10        (1) Any benefits under the System earned as a result of
11    that return to active service shall be reduced by the
12    amount specified in that person's written election.
13        (2) The partial accelerated pension benefit payment
14    may not be repaid to the System.
15        (3) That person is not eligible to elect or receive any
16    additional partial accelerated pension benefit payment.
17    (e) The partial accelerated pension benefit payment under
18this Section may be subject to withholding or payment of
19applicable taxes, but to the extent permitted by federal law, a
20person who receives a partial accelerated pension benefit
21payment under this Section may direct the System to pay all or
22a portion of that payment as a rollover into another retirement
23plan or account qualified under the Internal Revenue Code of
241986, as amended.
25    (f) The Board shall adopt any rules necessary to implement
26this Section.

 

 

HB4427- 40 -LRB099 15486 RPS 39775 b

1    (g) No provision of this Section shall be interpreted in a
2way that would cause the applicable System to cease to be a
3qualified plan under the Internal Revenue Code of 1986.
 
4    (40 ILCS 5/2-162)
5    (Text of Section WITHOUT the changes made by P.A. 98-599,
6which has been held unconstitutional)
7    Sec. 2-162. Application and expiration of new benefit
8increases.
9    (a) As used in this Section, "new benefit increase" means
10an increase in the amount of any benefit provided under this
11Article, or an expansion of the conditions of eligibility for
12any benefit under this Article, that results from an amendment
13to this Code that takes effect after June 1, 2005 (the
14effective date of Public Act 94-4). "New benefit increase",
15however, does not include any benefit increase resulting from
16the changes made to this Article by this amendatory Act of the
1799th General Assembly the effective date of this amendatory Act
18of the 94th General Assembly.
19    (b) Notwithstanding any other provision of this Code or any
20subsequent amendment to this Code, every new benefit increase
21is subject to this Section and shall be deemed to be granted
22only in conformance with and contingent upon compliance with
23the provisions of this Section.
24    (c) The Public Act enacting a new benefit increase must
25identify and provide for payment to the System of additional

 

 

HB4427- 41 -LRB099 15486 RPS 39775 b

1funding at least sufficient to fund the resulting annual
2increase in cost to the System as it accrues.
3    Every new benefit increase is contingent upon the General
4Assembly providing the additional funding required under this
5subsection. The Commission on Government Forecasting and
6Accountability shall analyze whether adequate additional
7funding has been provided for the new benefit increase and
8shall report its analysis to the Public Pension Division of the
9Department of Financial and Professional Regulation. A new
10benefit increase created by a Public Act that does not include
11the additional funding required under this subsection is null
12and void. If the Public Pension Division determines that the
13additional funding provided for a new benefit increase under
14this subsection is or has become inadequate, it may so certify
15to the Governor and the State Comptroller and, in the absence
16of corrective action by the General Assembly, the new benefit
17increase shall expire at the end of the fiscal year in which
18the certification is made.
19    (d) Every new benefit increase shall expire 5 years after
20its effective date or on such earlier date as may be specified
21in the language enacting the new benefit increase or provided
22under subsection (c). This does not prevent the General
23Assembly from extending or re-creating a new benefit increase
24by law.
25    (e) Except as otherwise provided in the language creating
26the new benefit increase, a new benefit increase that expires

 

 

HB4427- 42 -LRB099 15486 RPS 39775 b

1under this Section continues to apply to persons who applied
2and qualified for the affected benefit while the new benefit
3increase was in effect and to the affected beneficiaries and
4alternate payees of such persons, but does not apply to any
5other person, including without limitation a person who
6continues in service after the expiration date and did not
7apply and qualify for the affected benefit while the new
8benefit increase was in effect.
9(Source: P.A. 94-4, eff. 6-1-05.)
 
10    (40 ILCS 5/14-147.5 new)
11    Sec. 14-147.5. Accelerated pension benefit payment.
12    (a) To be eligible for an accelerated pension benefit
13payment provided in this Section, a person must:
14        (1) have terminated service;
15        (2) be eligible to receive a retirement annuity under
16    this Article;
17        (3) not have received any retirement annuity under this
18    Article;
19        (4) not have a QILDRO in effect against him or her
20    under this Article; and
21        (5) not have elected to receive a partial accelerated
22    pension benefit payment under Section 14-147.6.
23    Beginning January 1, 2017, an eligible person may make a
24written election with the System to receive an accelerated
25pension benefit payment in lieu of a retirement annuity.

 

 

HB4427- 43 -LRB099 15486 RPS 39775 b

1    A person who elects to receive an accelerated pension
2benefit payment under this Section may not elect to proceed
3under the Retirement Systems Reciprocal Act with respect to
4service under this Article.
5    (b) The accelerated pension benefit payment under this
6Section shall be a one-time lump sum payment in an amount equal
7to 75% of the present value of the greatest retirement annuity
8to which the eligible person is entitled at the date of the
9election (including any anticipated annual increases but
10disregarding any survivor benefits), as calculated by the
11System using the actuarial tables and other assumptions adopted
12by the Board.
13    (c) A person's credits and creditable service under this
14Article shall be terminated upon the person's receipt of an
15accelerated pension benefit payment under this Section, and no
16other benefit shall be paid under this Article based on those
17terminated credits and creditable service, including any
18retirement, survivor, or other benefit; except that to the
19extent that participation, benefits, or premiums under the
20State Employees Group Insurance Act of 1971 are based on the
21amount of service credit, the terminated service credit shall
22be used for that purpose.
23    (d) If a person who has received an accelerated pension
24benefit payment under this Section returns to active service
25under this Article, then:
26        (1) Any benefits under the System earned as a result of

 

 

HB4427- 44 -LRB099 15486 RPS 39775 b

1    that return to active service shall be based solely on the
2    person's credits and creditable service arising from the
3    return to active service.
4        (2) The accelerated pension benefit payment may not be
5    repaid to the System, and the terminated credits and
6    creditable service may not under any circumstances be
7    reinstated.
8    (e) The accelerated pension benefit payment under this
9Section may be subject to withholding or payment of applicable
10taxes, but to the extent permitted by federal law, a person who
11receives an accelerated pension benefit payment under this
12Section may direct the System to pay all or a portion of that
13payment as a rollover into another retirement plan or account
14qualified under the Internal Revenue Code of 1986, as amended.
15    (f) The Board shall adopt any rules necessary to implement
16this Section.
17    (g) No provision of this Section shall be interpreted in a
18way that would cause the applicable System to cease to be a
19qualified plan under the Internal Revenue Code of 1986.
 
20    (40 ILCS 5/14-147.6 new)
21    Sec. 14-147.6. Partial accelerated pension benefit
22payment.
23    (a) To be eligible for a partial accelerated pension
24benefit payment provided in this Section, a person must:
25        (1) have terminated service;

 

 

HB4427- 45 -LRB099 15486 RPS 39775 b

1        (2) be eligible to receive a retirement annuity under
2    this Article;
3        (3) not have received any retirement annuity under this
4    Article;
5        (4) not have a QILDRO in effect against him or her
6    under this Article; and
7        (5) not have elected to receive an accelerated pension
8    benefit payment under Section 14-147.5.
9    Beginning January 1, 2017, an eligible person may make a
10written election with the System to receive a partial
11accelerated pension benefit payment in exchange for a reduction
12in his or her retirement annuity and all other benefits under
13this Article, including, but not limited to, survivors
14benefits. In the written election, the eligible person shall
15specify the percentage by which the retirement annuity shall be
16reduced; however, a person may not elect a percentage reduction
17of his or her retirement annuity and all other benefits under
18this Article that would result in a partial accelerated pension
19benefit payment of less than $50,000.
20    Before providing the partial accelerated pension benefit
21payment under this Section to a person, the System shall notify
22that person if the percentage elected for the reduction in his
23or her retirement annuity and all other benefits under this
24Article would result in any applicable benefit being less than
25the minimum amount specified for that benefit in this Article,
26and the eligible person shall be provided the opportunity to

 

 

HB4427- 46 -LRB099 15486 RPS 39775 b

1change the amount of his or her election.
2    A person who elects to receive a partial accelerated
3pension benefit payment under this Section may not elect to
4proceed under the Retirement Systems Reciprocal Act with
5respect to service under this Article.
6    (b) The partial accelerated pension benefit payment under
7this Section shall be a one-time lump sum payment in an amount
8equal to 75% of the elected percentage. For the purposes of
9this Section, "elected percentage" means the percentage, as
10specified in the eligible person's written election, of the
11present value of the greatest retirement annuity to which the
12eligible person is entitled at the date of the election
13(including any anticipated annual increases but disregarding
14any survivor benefits), which shall be calculated by the System
15using the actuarial tables and other assumptions adopted by the
16Board.
17    A person who receives the partial accelerated pension
18benefit payment shall have the amount of his or her retirement
19annuity and all other benefits under this Article, including,
20but not limited to, survivors benefits, reduced by the
21percentage specified in that person's written election.
22    (c) The percentage reduction in retirement annuity and all
23other benefits under this Article may not under any
24circumstances be modified after the partial accelerated
25pension benefit payment under this Section is received.
26Notwithstanding any provision of this Article to the contrary,

 

 

HB4427- 47 -LRB099 15486 RPS 39775 b

1a person who elects to receive a partial accelerated pension
2benefit payment that results in an applicable benefit being
3less than the minimum amount specified for that benefit in this
4Article shall not be entitled to receive that minimum amount.
5    (d) If a person who has received a partial accelerated
6pension benefit payment under this Section returns to active
7service under this Article, then:
8        (1) Any benefits under the System earned as a result of
9    that return to active service shall be reduced by the
10    amount specified in that person's written election.
11        (2) The partial accelerated pension benefit payment
12    may not be repaid to the System.
13        (3) That person is not eligible to elect or receive any
14    additional partial accelerated pension benefit payment.
15    (e) The partial accelerated pension benefit payment under
16this Section may be subject to withholding or payment of
17applicable taxes, but to the extent permitted by federal law, a
18person who receives a partial accelerated pension benefit
19payment under this Section may direct the System to pay all or
20a portion of that payment as a rollover into another retirement
21plan or account qualified under the Internal Revenue Code of
221986, as amended.
23    (f) The Board shall adopt any rules necessary to implement
24this Section.
25    (g) No provision of this Section shall be interpreted in a
26way that would cause the applicable System to cease to be a

 

 

HB4427- 48 -LRB099 15486 RPS 39775 b

1qualified plan under the Internal Revenue Code of 1986.
 
2    (40 ILCS 5/14-152.1)
3    (Text of Section WITHOUT the changes made by P.A. 98-599,
4which has been held unconstitutional)
5    Sec. 14-152.1. Application and expiration of new benefit
6increases.
7    (a) As used in this Section, "new benefit increase" means
8an increase in the amount of any benefit provided under this
9Article, or an expansion of the conditions of eligibility for
10any benefit under this Article, that results from an amendment
11to this Code that takes effect after June 1, 2005 (the
12effective date of Public Act 94-4). "New benefit increase",
13however, does not include any benefit increase resulting from
14the changes made to this Article by Public Act 96-37 or by this
15amendatory Act of the 99th General Assembly this amendatory Act
16of the 96th General Assembly.
17    (b) Notwithstanding any other provision of this Code or any
18subsequent amendment to this Code, every new benefit increase
19is subject to this Section and shall be deemed to be granted
20only in conformance with and contingent upon compliance with
21the provisions of this Section.
22    (c) The Public Act enacting a new benefit increase must
23identify and provide for payment to the System of additional
24funding at least sufficient to fund the resulting annual
25increase in cost to the System as it accrues.

 

 

HB4427- 49 -LRB099 15486 RPS 39775 b

1    Every new benefit increase is contingent upon the General
2Assembly providing the additional funding required under this
3subsection. The Commission on Government Forecasting and
4Accountability shall analyze whether adequate additional
5funding has been provided for the new benefit increase and
6shall report its analysis to the Public Pension Division of the
7Department of Financial and Professional Regulation. A new
8benefit increase created by a Public Act that does not include
9the additional funding required under this subsection is null
10and void. If the Public Pension Division determines that the
11additional funding provided for a new benefit increase under
12this subsection is or has become inadequate, it may so certify
13to the Governor and the State Comptroller and, in the absence
14of corrective action by the General Assembly, the new benefit
15increase shall expire at the end of the fiscal year in which
16the certification is made.
17    (d) Every new benefit increase shall expire 5 years after
18its effective date or on such earlier date as may be specified
19in the language enacting the new benefit increase or provided
20under subsection (c). This does not prevent the General
21Assembly from extending or re-creating a new benefit increase
22by law.
23    (e) Except as otherwise provided in the language creating
24the new benefit increase, a new benefit increase that expires
25under this Section continues to apply to persons who applied
26and qualified for the affected benefit while the new benefit

 

 

HB4427- 50 -LRB099 15486 RPS 39775 b

1increase was in effect and to the affected beneficiaries and
2alternate payees of such persons, but does not apply to any
3other person, including without limitation a person who
4continues in service after the expiration date and did not
5apply and qualify for the affected benefit while the new
6benefit increase was in effect.
7(Source: P.A. 96-37, eff. 7-13-09.)
 
8    (40 ILCS 5/15-185.5 new)
9    Sec. 15-185.5. Accelerated pension benefit payment.
10    (a) To be eligible for an accelerated pension benefit
11payment provided in this Section, a person must:
12        (1) have terminated service;
13        (2) be eligible to receive a retirement annuity under
14    this Article;
15        (3) not have received any retirement annuity under this
16    Article;
17        (4) not have a QILDRO in effect against him or her
18    under this Article;
19        (5) not have elected to receive a partial accelerated
20    pension benefit payment under Section 15-185.6; and
21        (6) not be a participant in the self-managed plan
22    created in Section 15-158.2.
23    Beginning January 1, 2017, an eligible person may make a
24written election with the System to receive an accelerated
25pension benefit payment in lieu of a retirement annuity.

 

 

HB4427- 51 -LRB099 15486 RPS 39775 b

1    A person who elects to receive an accelerated pension
2benefit payment under this Section may not elect to proceed
3under the Retirement Systems Reciprocal Act with respect to
4service under this Article.
5    (b) The accelerated pension benefit payment under this
6Section shall be a one-time lump sum payment in an amount equal
7to 75% of the present value of the greatest retirement annuity
8to which the eligible person is entitled at the date of the
9election (including any anticipated annual increases but
10disregarding any survivor benefits), as calculated by the
11System using the actuarial tables and other assumptions adopted
12by the Board.
13    (c) A person's credits and creditable service under this
14Article shall be terminated upon the person's receipt of an
15accelerated pension benefit payment under this Section, and no
16other benefit shall be paid under this Article based on those
17terminated credits and creditable service, including any
18retirement, survivor, or other benefit; except that to the
19extent that participation, benefits, or premiums under the
20State Employees Group Insurance Act of 1971 are based on the
21amount of service credit, the terminated service credit shall
22be used for that purpose.
23    (d) If a person who has received an accelerated pension
24benefit payment under this Section returns to active service
25under this Article, then:
26        (1) Any benefits under the System earned as a result of

 

 

HB4427- 52 -LRB099 15486 RPS 39775 b

1    that return to active service shall be based solely on the
2    person's credits and creditable service arising from the
3    return to active service.
4        (2) The accelerated pension benefit payment may not be
5    repaid to the System, and the terminated credits and
6    creditable service may not under any circumstances be
7    reinstated.
8    (e) The accelerated pension benefit payment under this
9Section may be subject to withholding or payment of applicable
10taxes, but to the extent permitted by federal law, a person who
11receives an accelerated pension benefit payment under this
12Section may direct the System to pay all or a portion of that
13payment as a rollover into another retirement plan or account
14qualified under the Internal Revenue Code of 1986, as amended.
15    (f) The Board shall adopt any rules necessary to implement
16this Section.
17    (g) No provision of this Section shall be interpreted in a
18way that would cause the applicable System to cease to be a
19qualified plan under the Internal Revenue Code of 1986.
 
20    (40 ILCS 5/15-185.6 new)
21    Sec. 15-185.6. Partial accelerated pension benefit
22payment.
23    (a) To be eligible for a partial accelerated pension
24benefit payment provided in this Section, a person must:
25        (1) have terminated service;

 

 

HB4427- 53 -LRB099 15486 RPS 39775 b

1        (2) be eligible to receive a retirement annuity under
2    this Article;
3        (3) not have received any retirement annuity under this
4    Article;
5        (4) not have a QILDRO in effect against him or her
6    under this Article;
7        (5) not have elected to receive an accelerated pension
8    benefit payment under Section 15-185.5; and
9        (6) not be a participant in the self-managed plan
10    created in Section 15-158.2.
11    Beginning January 1, 2017, an eligible person may make a
12written election with the System to receive a partial
13accelerated pension benefit payment in exchange for a reduction
14in his or her retirement annuity and all other benefits under
15this Article, including, but not limited to, survivors
16benefits. In the written election, the eligible person shall
17specify the percentage by which the retirement annuity shall be
18reduced; however, a person may not elect a percentage reduction
19of his or her retirement annuity and all other benefits under
20this Article that would result in a partial accelerated pension
21benefit payment of less than $50,000.
22    Before providing the partial accelerated pension benefit
23payment under this Section to a person, the System shall notify
24that person if the percentage elected for the reduction in his
25or her retirement annuity and all other benefits under this
26Article would result in any applicable benefit being less than

 

 

HB4427- 54 -LRB099 15486 RPS 39775 b

1the minimum amount specified for that benefit in this Article,
2and the eligible person shall be provided the opportunity to
3change the amount of his or her election.
4    A person who elects to receive a partial accelerated
5pension benefit payment under this Section may not elect to
6proceed under the Retirement Systems Reciprocal Act with
7respect to service under this Article.
8    (b) The partial accelerated pension benefit payment under
9this Section shall be a one-time lump sum payment in an amount
10equal to 75% of the elected percentage. For the purposes of
11this Section, "elected percentage" means the percentage, as
12specified in the eligible person's written election, of the
13present value of the greatest retirement annuity to which the
14eligible person is entitled at the date of the election
15(including any anticipated annual increases but disregarding
16any survivor benefits), which shall be calculated by the System
17using the actuarial tables and other assumptions adopted by the
18Board.
19    A person who receives the partial accelerated pension
20benefit payment shall have the amount of his or her retirement
21annuity and all other benefits under this Article, including,
22but not limited to, survivors benefits, reduced by the
23percentage specified in that person's written election.
24    (c) The percentage reduction in retirement annuity and all
25other benefits under this Article may not under any
26circumstances be modified after the partial accelerated

 

 

HB4427- 55 -LRB099 15486 RPS 39775 b

1pension benefit payment under this Section is received.
2Notwithstanding any provision of this Article to the contrary,
3a person who elects to receive a partial accelerated pension
4benefit payment that results in an applicable benefit being
5less than the minimum amount specified for that benefit in this
6Article shall not be entitled to receive that minimum amount.
7    (d) If a person who has received a partial accelerated
8pension benefit payment under this Section returns to active
9service under this Article, then:
10        (1) Any benefits under the System earned as a result of
11    that return to active service shall be reduced by the
12    amount specified in that person's written election.
13        (2) The partial accelerated pension benefit payment
14    may not be repaid to the System.
15        (3) That person is not eligible to elect or receive any
16    additional partial accelerated pension benefit payment.
17    (e) The partial accelerated pension benefit payment under
18this Section may be subject to withholding or payment of
19applicable taxes, but to the extent permitted by federal law, a
20person who receives a partial accelerated pension benefit
21payment under this Section may direct the System to pay all or
22a portion of that payment as a rollover into another retirement
23plan or account qualified under the Internal Revenue Code of
241986, as amended.
25    (f) The Board shall adopt any rules necessary to implement
26this Section.

 

 

HB4427- 56 -LRB099 15486 RPS 39775 b

1    (g) No provision of this Section shall be interpreted in a
2way that would cause the applicable System to cease to be a
3qualified plan under the Internal Revenue Code of 1986.
 
4    (40 ILCS 5/15-198)
5    (Text of Section WITHOUT the changes made by P.A. 98-599,
6which has been held unconstitutional)
7    Sec. 15-198. Application and expiration of new benefit
8increases.
9    (a) As used in this Section, "new benefit increase" means
10an increase in the amount of any benefit provided under this
11Article, or an expansion of the conditions of eligibility for
12any benefit under this Article, that results from an amendment
13to this Code that takes effect after June 1, 2005 (the
14effective date of Public Act 94-4). "New benefit increase",
15however, does not include any benefit increase resulting from
16the changes made to this Article by this amendatory Act of the
1799th General Assembly the effective date of this amendatory Act
18of the 94th General Assembly.
19    (b) Notwithstanding any other provision of this Code or any
20subsequent amendment to this Code, every new benefit increase
21is subject to this Section and shall be deemed to be granted
22only in conformance with and contingent upon compliance with
23the provisions of this Section.
24    (c) The Public Act enacting a new benefit increase must
25identify and provide for payment to the System of additional

 

 

HB4427- 57 -LRB099 15486 RPS 39775 b

1funding at least sufficient to fund the resulting annual
2increase in cost to the System as it accrues.
3    Every new benefit increase is contingent upon the General
4Assembly providing the additional funding required under this
5subsection. The Commission on Government Forecasting and
6Accountability shall analyze whether adequate additional
7funding has been provided for the new benefit increase and
8shall report its analysis to the Public Pension Division of the
9Department of Financial and Professional Regulation. A new
10benefit increase created by a Public Act that does not include
11the additional funding required under this subsection is null
12and void. If the Public Pension Division determines that the
13additional funding provided for a new benefit increase under
14this subsection is or has become inadequate, it may so certify
15to the Governor and the State Comptroller and, in the absence
16of corrective action by the General Assembly, the new benefit
17increase shall expire at the end of the fiscal year in which
18the certification is made.
19    (d) Every new benefit increase shall expire 5 years after
20its effective date or on such earlier date as may be specified
21in the language enacting the new benefit increase or provided
22under subsection (c). This does not prevent the General
23Assembly from extending or re-creating a new benefit increase
24by law.
25    (e) Except as otherwise provided in the language creating
26the new benefit increase, a new benefit increase that expires

 

 

HB4427- 58 -LRB099 15486 RPS 39775 b

1under this Section continues to apply to persons who applied
2and qualified for the affected benefit while the new benefit
3increase was in effect and to the affected beneficiaries and
4alternate payees of such persons, but does not apply to any
5other person, including without limitation a person who
6continues in service after the expiration date and did not
7apply and qualify for the affected benefit while the new
8benefit increase was in effect.
9(Source: P.A. 94-4, eff. 6-1-05.)
 
10    (40 ILCS 5/16-190.5 new)
11    Sec. 16-190.5. Accelerated pension benefit payment.
12    (a) To be eligible for an accelerated pension benefit
13payment provided in this Section, a person must:
14        (1) have terminated service;
15        (2) be eligible to receive a retirement annuity under
16    this Article;
17        (3) not have received any retirement annuity under this
18    Article;
19        (4) not have a QILDRO in effect against him or her
20    under this Article; and
21        (5) not have elected to receive a partial accelerated
22    pension benefit payment under Section 16-190.6.
23    Beginning January 1, 2017, an eligible person may make a
24written election with the System to receive an accelerated
25pension benefit payment in lieu of a retirement annuity.

 

 

HB4427- 59 -LRB099 15486 RPS 39775 b

1    A person who elects to receive an accelerated pension
2benefit payment under this Section may not elect to proceed
3under the Retirement Systems Reciprocal Act with respect to
4service under this Article.
5    (b) The accelerated pension benefit payment under this
6Section shall be a one-time lump sum payment in an amount equal
7to 75% of the present value of the greatest retirement annuity
8to which the eligible person is entitled at the date of the
9election (including any anticipated annual increases but
10disregarding any survivor benefits), as calculated by the
11System using the actuarial tables and other assumptions adopted
12by the Board.
13    (c) A person's credits and creditable service under this
14Article shall be terminated upon the person's receipt of an
15accelerated pension benefit payment under this Section, and no
16other benefit shall be paid under this Article based on those
17terminated credits and creditable service, including any
18retirement, survivor, or other benefit; except that to the
19extent that participation, benefits, or premiums under the
20State Employees Group Insurance Act of 1971 are based on the
21amount of service credit, the terminated service credit shall
22be used for that purpose.
23    (d) If a person who has received an accelerated pension
24benefit payment under this Section returns to active service
25under this Article, then:
26        (1) Any benefits under the System earned as a result of

 

 

HB4427- 60 -LRB099 15486 RPS 39775 b

1    that return to active service shall be based solely on the
2    person's credits and creditable service arising from the
3    return to active service.
4        (2) The accelerated pension benefit payment may not be
5    repaid to the System, and the terminated credits and
6    creditable service may not under any circumstances be
7    reinstated.
8    (e) The accelerated pension benefit payment under this
9Section may be subject to withholding or payment of applicable
10taxes, but to the extent permitted by federal law, a person who
11receives an accelerated pension benefit payment under this
12Section may direct the System to pay all or a portion of that
13payment as a rollover into another retirement plan or account
14qualified under the Internal Revenue Code of 1986, as amended.
15    (f) The Board shall adopt any rules necessary to implement
16this Section.
17    (g) No provision of this Section shall be interpreted in a
18way that would cause the applicable System to cease to be a
19qualified plan under the Internal Revenue Code of 1986.
 
20    (40 ILCS 5/16-190.6 new)
21    Sec. 16-190.6. Partial accelerated pension benefit
22payment.
23    (a) To be eligible for a partial accelerated pension
24benefit payment provided in this Section, a person must:
25        (1) have terminated service;

 

 

HB4427- 61 -LRB099 15486 RPS 39775 b

1        (2) be eligible to receive a retirement annuity under
2    this Article;
3        (3) not have received any retirement annuity under this
4    Article;
5        (4) not have a QILDRO in effect against him or her
6    under this Article; and
7        (5) not have elected to receive an accelerated pension
8    benefit payment under Section 16-190.5.
9    Beginning January 1, 2017, an eligible person may make a
10written election with the System to receive a partial
11accelerated pension benefit payment in exchange for a reduction
12in his or her retirement annuity and all other benefits under
13this Article, including, but not limited to, survivors
14benefits. In the written election, the eligible person shall
15specify the percentage by which the retirement annuity shall be
16reduced; however, a person may not elect a percentage reduction
17of his or her retirement annuity and all other benefits under
18this Article that would result in a partial accelerated pension
19benefit payment of less than $50,000.
20    Before providing the partial accelerated pension benefit
21payment under this Section to a person, the System shall notify
22that person if the percentage elected for the reduction in his
23or her retirement annuity and all other benefits under this
24Article would result in any applicable benefit being less than
25the minimum amount specified for that benefit in this Article,
26and the eligible person shall be provided the opportunity to

 

 

HB4427- 62 -LRB099 15486 RPS 39775 b

1change the amount of his or her election.
2    A person who elects to receive a partial accelerated
3pension benefit payment under this Section may not elect to
4proceed under the Retirement Systems Reciprocal Act with
5respect to service under this Article.
6    (b) The partial accelerated pension benefit payment under
7this Section shall be a one-time lump sum payment in an amount
8equal to 75% of the elected percentage. For the purposes of
9this Section, "elected percentage" means the percentage, as
10specified in the eligible person's written election, of the
11present value of the greatest retirement annuity to which the
12eligible person is entitled at the date of the election
13(including any anticipated annual increases but disregarding
14any survivor benefits), which shall be calculated by the System
15using the actuarial tables and other assumptions adopted by the
16Board.
17    A person who receives the partial accelerated pension
18benefit payment shall have the amount of his or her retirement
19annuity and all other benefits under this Article, including,
20but not limited to, survivors benefits, reduced by the
21percentage specified in that person's written election.
22    (c) The percentage reduction in retirement annuity and all
23other benefits under this Article may not under any
24circumstances be modified after the partial accelerated
25pension benefit payment under this Section is received.
26Notwithstanding any provision of this Article to the contrary,

 

 

HB4427- 63 -LRB099 15486 RPS 39775 b

1a person who elects to receive a partial accelerated pension
2benefit payment that results in an applicable benefit being
3less than the minimum amount specified for that benefit in this
4Article shall not be entitled to receive that minimum amount.
5    (d) If a person who has received a partial accelerated
6pension benefit payment under this Section returns to active
7service under this Article, then:
8        (1) Any benefits under the System earned as a result of
9    that return to active service shall be reduced by the
10    amount specified in that person's written election.
11        (2) The partial accelerated pension benefit payment
12    may not be repaid to the System.
13        (3) That person is not eligible to elect or receive any
14    additional partial accelerated pension benefit payment.
15    (e) The partial accelerated pension benefit payment under
16this Section may be subject to withholding or payment of
17applicable taxes, but to the extent permitted by federal law, a
18person who receives a partial accelerated pension benefit
19payment under this Section may direct the System to pay all or
20a portion of that payment as a rollover into another retirement
21plan or account qualified under the Internal Revenue Code of
221986, as amended.
23    (f) The Board shall adopt any rules necessary to implement
24this Section.
25    (g) No provision of this Section shall be interpreted in a
26way that would cause the applicable System to cease to be a

 

 

HB4427- 64 -LRB099 15486 RPS 39775 b

1qualified plan under the Internal Revenue Code of 1986.
 
2    (40 ILCS 5/16-203)
3    (Text of Section WITHOUT the changes made by P.A. 98-599,
4which has been held unconstitutional)
5    Sec. 16-203. Application and expiration of new benefit
6increases.
7    (a) As used in this Section, "new benefit increase" means
8an increase in the amount of any benefit provided under this
9Article, or an expansion of the conditions of eligibility for
10any benefit under this Article, that results from an amendment
11to this Code that takes effect after June 1, 2005 (the
12effective date of Public Act 94-4). "New benefit increase",
13however, does not include any benefit increase resulting from
14the changes made to this Article by Public Act 95-910 or by
15this amendatory Act of the 99th General Assembly this
16amendatory Act of the 95th General Assembly.
17    (b) Notwithstanding any other provision of this Code or any
18subsequent amendment to this Code, every new benefit increase
19is subject to this Section and shall be deemed to be granted
20only in conformance with and contingent upon compliance with
21the provisions of this Section.
22    (c) The Public Act enacting a new benefit increase must
23identify and provide for payment to the System of additional
24funding at least sufficient to fund the resulting annual
25increase in cost to the System as it accrues.

 

 

HB4427- 65 -LRB099 15486 RPS 39775 b

1    Every new benefit increase is contingent upon the General
2Assembly providing the additional funding required under this
3subsection. The Commission on Government Forecasting and
4Accountability shall analyze whether adequate additional
5funding has been provided for the new benefit increase and
6shall report its analysis to the Public Pension Division of the
7Department of Financial and Professional Regulation. A new
8benefit increase created by a Public Act that does not include
9the additional funding required under this subsection is null
10and void. If the Public Pension Division determines that the
11additional funding provided for a new benefit increase under
12this subsection is or has become inadequate, it may so certify
13to the Governor and the State Comptroller and, in the absence
14of corrective action by the General Assembly, the new benefit
15increase shall expire at the end of the fiscal year in which
16the certification is made.
17    (d) Every new benefit increase shall expire 5 years after
18its effective date or on such earlier date as may be specified
19in the language enacting the new benefit increase or provided
20under subsection (c). This does not prevent the General
21Assembly from extending or re-creating a new benefit increase
22by law.
23    (e) Except as otherwise provided in the language creating
24the new benefit increase, a new benefit increase that expires
25under this Section continues to apply to persons who applied
26and qualified for the affected benefit while the new benefit

 

 

HB4427- 66 -LRB099 15486 RPS 39775 b

1increase was in effect and to the affected beneficiaries and
2alternate payees of such persons, but does not apply to any
3other person, including without limitation a person who
4continues in service after the expiration date and did not
5apply and qualify for the affected benefit while the new
6benefit increase was in effect.
7(Source: P.A. 94-4, eff. 6-1-05; 95-910, eff. 8-26-08.)
 
8    (40 ILCS 5/18-161.5 new)
9    Sec. 18-161.5. Accelerated pension benefit payment.
10    (a) To be eligible for an accelerated pension benefit
11payment provided in this Section, a person must:
12        (1) have terminated service;
13        (2) be eligible to receive a retirement annuity under
14    this Article;
15        (3) not have received any retirement annuity under this
16    Article;
17        (4) not have a QILDRO in effect against him or her
18    under this Article; and
19        (5) not have elected to receive a partial accelerated
20    pension benefit payment under Section 18-161.6.
21    Beginning January 1, 2017, an eligible person may make a
22written election with the System to receive an accelerated
23pension benefit payment in lieu of a retirement annuity.
24    A person who elects to receive an accelerated pension
25benefit payment under this Section may not elect to proceed

 

 

HB4427- 67 -LRB099 15486 RPS 39775 b

1under the Retirement Systems Reciprocal Act with respect to
2service under this Article.
3    (b) The accelerated pension benefit payment under this
4Section shall be a one-time lump sum payment in an amount equal
5to 75% of the present value of the greatest retirement annuity
6to which the eligible person is entitled at the date of the
7election (including any anticipated annual increases but
8disregarding any survivor benefits), as calculated by the
9System using the actuarial tables and other assumptions adopted
10by the Board.
11    (c) A person's credits and creditable service under this
12Article shall be terminated upon the person's receipt of an
13accelerated pension benefit payment under this Section, and no
14other benefit shall be paid under this Article based on those
15terminated credits and creditable service, including any
16retirement, survivor, or other benefit; except that to the
17extent that participation, benefits, or premiums under the
18State Employees Group Insurance Act of 1971 are based on the
19amount of service credit, the terminated service credit shall
20be used for that purpose.
21    (d) If a person who has received a partial accelerated
22pension benefit payment under this Section returns to active
23service under this Article, then:
24        (1) Any benefits under the System earned as a result of
25    that return to active service shall be based solely on the
26    person's credits and creditable service arising from the

 

 

HB4427- 68 -LRB099 15486 RPS 39775 b

1    return to active service.
2        (2) The accelerated pension benefit payment may not be
3    repaid to the System, and the terminated credits and
4    creditable service may not under any circumstances be
5    reinstated.
6    (e) The accelerated pension benefit payment under this
7Section may be subject to withholding or payment of applicable
8taxes, but to the extent permitted by federal law, a person who
9receives an accelerated pension benefit payment under this
10Section may direct the System to pay all or a portion of that
11payment as a rollover into another retirement plan or account
12qualified under the Internal Revenue Code of 1986, as amended.
13    (f) The Board shall adopt any rules necessary to implement
14this Section.
15    (g) No provision of this Section shall be interpreted in a
16way that would cause the applicable System to cease to be a
17qualified plan under the Internal Revenue Code of 1986.
 
18    (40 ILCS 5/18-161.6 new)
19    Sec. 18-161.6. Partial accelerated pension benefit
20payment.
21    (a) To be eligible for a partial accelerated pension
22benefit payment provided in this Section, a person must:
23        (1) have terminated service;
24        (2) be eligible to receive a retirement annuity under
25    this Article;

 

 

HB4427- 69 -LRB099 15486 RPS 39775 b

1        (3) not have received any retirement annuity under this
2    Article;
3        (4) not have a QILDRO in effect against him or her
4    under this Article; and
5        (5) not have elected to receive an accelerated pension
6    benefit payment under Section 18-161.5.
7    Beginning January 1, 2017, an eligible person may make a
8written election with the System to receive a partial
9accelerated pension benefit payment in exchange for a reduction
10in his or her retirement annuity and all other benefits under
11this Article, including, but not limited to, survivors
12benefits. In the written election, the eligible person shall
13specify the percentage by which the retirement annuity shall be
14reduced; however, a person may not elect a percentage reduction
15of his or her retirement annuity and all other benefits under
16this Article that would result in a partial accelerated pension
17benefit payment of less than $50,000.
18    Before providing the partial accelerated pension benefit
19payment under this Section to a person, the System shall notify
20that person if the percentage elected for the reduction in his
21or her retirement annuity and all other benefits under this
22Article would result in any applicable benefit being less than
23the minimum amount specified for that benefit in this Article,
24and the eligible person shall be provided the opportunity to
25change the amount of his or her election.
26    A person who elects to receive a partial accelerated

 

 

HB4427- 70 -LRB099 15486 RPS 39775 b

1pension benefit payment under this Section may not elect to
2proceed under the Retirement Systems Reciprocal Act with
3respect to service under this Article.
4    (b) The partial accelerated pension benefit payment under
5this Section shall be a one-time lump sum payment in an amount
6equal to 75% of the elected percentage. For the purposes of
7this Section, "elected percentage" means the percentage, as
8specified in the eligible person's written election, of the
9present value of the greatest retirement annuity to which the
10eligible person is entitled at the date of the election
11(including any anticipated annual increases but disregarding
12any survivor benefits), which shall be calculated by the System
13using the actuarial tables and other assumptions adopted by the
14Board.
15    A person who receives the partial accelerated pension
16benefit payment shall have the amount of his or her retirement
17annuity and all other benefits under this Article, including,
18but not limited to, survivors benefits, reduced by the
19percentage specified in that person's written election.
20    (c) The percentage reduction in retirement annuity and all
21other benefits under this Article may not under any
22circumstances be modified after the partial accelerated
23pension benefit payment under this Section is received.
24Notwithstanding any provision of this Article to the contrary,
25a person who elects to receive a partial accelerated pension
26benefit payment that results in an applicable benefit being

 

 

HB4427- 71 -LRB099 15486 RPS 39775 b

1less than the minimum amount specified for that benefit in this
2Article shall not be entitled to receive that minimum amount.
3    (d) If a person who has received an accelerated pension
4benefit payment under this Section returns to active service
5under this Article, then:
6        (1) Any benefits under the System earned as a result of
7    that return to active service shall be reduced by the
8    amount specified in that person's written election.
9        (2) The partial accelerated pension benefit payment
10    may not be repaid to the System.
11        (3) That person is not eligible to elect or receive any
12    additional partial accelerated pension benefit payment.
13    (e) The partial accelerated pension benefit payment under
14this Section may be subject to withholding or payment of
15applicable taxes, but to the extent permitted by federal law, a
16person who receives a partial accelerated pension benefit
17payment under this Section may direct the System to pay all or
18a portion of that payment as a rollover into another retirement
19plan or account qualified under the Internal Revenue Code of
201986, as amended.
21    (f) The Board shall adopt any rules necessary to implement
22this Section.
23    (g) No provision of this Section shall be interpreted in a
24way that would cause the applicable System to cease to be a
25qualified plan under the Internal Revenue Code of 1986.
 

 

 

HB4427- 72 -LRB099 15486 RPS 39775 b

1    (40 ILCS 5/18-169)
2    Sec. 18-169. Application and expiration of new benefit
3increases.
4    (a) As used in this Section, "new benefit increase" means
5an increase in the amount of any benefit provided under this
6Article, or an expansion of the conditions of eligibility for
7any benefit under this Article, that results from an amendment
8to this Code that takes effect after June 1, 2005 (the
9effective date of Public Act 94-4). "New benefit increase",
10however, does not include any benefit increase resulting from
11the changes made to this Article by this amendatory Act of the
1299th General Assembly the effective date of this amendatory Act
13of the 94th General Assembly.
14    (b) Notwithstanding any other provision of this Code or any
15subsequent amendment to this Code, every new benefit increase
16is subject to this Section and shall be deemed to be granted
17only in conformance with and contingent upon compliance with
18the provisions of this Section.
19    (c) The Public Act enacting a new benefit increase must
20identify and provide for payment to the System of additional
21funding at least sufficient to fund the resulting annual
22increase in cost to the System as it accrues.
23    Every new benefit increase is contingent upon the General
24Assembly providing the additional funding required under this
25subsection. The Commission on Government Forecasting and
26Accountability shall analyze whether adequate additional

 

 

HB4427- 73 -LRB099 15486 RPS 39775 b

1funding has been provided for the new benefit increase and
2shall report its analysis to the Public Pension Division of the
3Department of Financial and Professional Regulation. A new
4benefit increase created by a Public Act that does not include
5the additional funding required under this subsection is null
6and void. If the Public Pension Division determines that the
7additional funding provided for a new benefit increase under
8this subsection is or has become inadequate, it may so certify
9to the Governor and the State Comptroller and, in the absence
10of corrective action by the General Assembly, the new benefit
11increase shall expire at the end of the fiscal year in which
12the certification is made.
13    (d) Every new benefit increase shall expire 5 years after
14its effective date or on such earlier date as may be specified
15in the language enacting the new benefit increase or provided
16under subsection (c). This does not prevent the General
17Assembly from extending or re-creating a new benefit increase
18by law.
19    (e) Except as otherwise provided in the language creating
20the new benefit increase, a new benefit increase that expires
21under this Section continues to apply to persons who applied
22and qualified for the affected benefit while the new benefit
23increase was in effect and to the affected beneficiaries and
24alternate payees of such persons, but does not apply to any
25other person, including without limitation a person who
26continues in service after the expiration date and did not

 

 

HB4427- 74 -LRB099 15486 RPS 39775 b

1apply and qualify for the affected benefit while the new
2benefit increase was in effect.
3(Source: P.A. 94-4, eff. 6-1-05.)
 
4    Section 99. Effective date. This Act takes effect upon
5becoming law.

 

 

HB4427- 75 -LRB099 15486 RPS 39775 b

1 INDEX
2 Statutes amended in order of appearance
3    5 ILCS 375/3from Ch. 127, par. 523
4    5 ILCS 375/10from Ch. 127, par. 530
5    40 ILCS 5/2-154.5 new
6    40 ILCS 5/2-154.6 new
7    40 ILCS 5/2-162
8    40 ILCS 5/14-147.5 new
9    40 ILCS 5/14-147.6 new
10    40 ILCS 5/14-152.1
11    40 ILCS 5/15-185.5 new
12    40 ILCS 5/15-185.6 new
13    40 ILCS 5/15-198
14    40 ILCS 5/16-190.5 new
15    40 ILCS 5/16-190.6 new
16    40 ILCS 5/16-203
17    40 ILCS 5/18-161.5 new
18    40 ILCS 5/18-161.6 new
19    40 ILCS 5/18-169