Illinois General Assembly - Full Text of HB4973
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Full Text of HB4973  94th General Assembly

HB4973 94TH GENERAL ASSEMBLY


 


 
94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006
HB4973

 

Introduced 1/19/2006, by Rep. Richard T. Bradley

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/7-114   from Ch. 108 1/2, par. 7-114
40 ILCS 5/7-118   from Ch. 108 1/2, par. 7-118
40 ILCS 5/7-135   from Ch. 108 1/2, par. 7-135
40 ILCS 5/7-139   from Ch. 108 1/2, par. 7-139
40 ILCS 5/7-153.1 new
40 ILCS 5/7-170   from Ch. 108 1/2, par. 7-170
40 ILCS 5/7-171   from Ch. 108 1/2, par. 7-171
40 ILCS 5/7-172   from Ch. 108 1/2, par. 7-172
40 ILCS 5/7-173   from Ch. 108 1/2, par. 7-173
40 ILCS 5/7-173.2   from Ch. 108 1/2, par. 7-173.2
40 ILCS 5/7-204   from Ch. 108 1/2, par. 7-204
40 ILCS 5/7-205   from Ch. 108 1/2, par. 7-205
40 ILCS 5/7-211   from Ch. 108 1/2, par. 7-211
30 ILCS 805/8.30 new

    Amends the IMRF Article of the Illinois Pension Code. Provides that any moneys received by an elected official from the State of Illinois for service in that capacity shall be deemed earnings unless specifically excluded. Changes the provisions defining and specifying the manner of designating a beneficiary. With respect to persons establishing service credit for periods spent on a leave of absence, removes a provision requiring application within 2 years. Removes obsolete language relating to the payment of federal social security contributions to the Fund. Provides that an employee whose disability determination or medical examination results are at issue before the Board may request that the portion of the Board meeting or committee hearing concerning the disability determination or medical examination be closed to the public. Provides that if a retiring employee has accumulated nonconcurrent service with more than one participating municipality or participating instrumentality, aggregate municipality charges shall be prorated among all nonfinal employers based on service credit and projected earnings with those employers and, for the final employer, municipality charges shall be based on the remaining cost of the employee's pension. Makes a technical correction. Provides that each county with current or former elected county officers participating in the alternative annuity program shall have a separate employer contribution rate computed for those elected officers, and provides that those officers shall be treated as a separate unit within the Fund. In the provisions relating to employer pick-up of employee contributions, requires pick-up of employee contributions under the alternative program for elected county officers. Makes other changes. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.


LRB094 15880 AMC 51102 b

FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT

 

 

A BILL FOR

 

HB4973 LRB094 15880 AMC 51102 b

1     AN ACT concerning public employee benefits.
 
2     Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
 
4     Section 5. The Illinois Pension Code is amended by changing
5 Sections 7-114, 7-118, 7-135, 7-139, 7-170, 7-171, 7-172,
6 7-173, 7-173.2, 7-204, 7-205, and 7-211 and by adding Section
7 7-153.1 as follows:
 
8     (40 ILCS 5/7-114)  (from Ch. 108 1/2, par. 7-114)
9     Sec. 7-114. Earnings. "Earnings":
10     (a) An amount to be determined by the board, equal to the
11 sum of:
12         1. The total amount of money paid to an employee for
13     personal services or official duties as an employee (except
14     those employed as independent contractors) paid out of the
15     general fund, or out of any special funds controlled by the
16     municipality, or by any instrumentality thereof, or
17     participating instrumentality, including compensation,
18     fees, allowances, or other emolument paid for official
19     duties (but not including automobile maintenance, travel
20     expense, or reimbursements for expenditures incurred in
21     the performance of duties) and, for fee offices, the fees
22     or earnings of the offices to the extent such fees are paid
23     out of funds controlled by the municipality, or
24     instrumentality or participating instrumentality; and
25         2. The money value, as determined by rules prescribed
26     by the governing body of the municipality, or
27     instrumentality thereof, of any board, lodging, fuel,
28     laundry, and other allowances provided an employee in lieu
29     of money.
30     (b) For purposes of determining benefits payable under this
31 fund payments to a person who is engaged in an independently
32 established trade, occupation, profession or business and who

 

 

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1 is paid for his service on a basis other than a monthly or
2 other regular salary, are not earnings.
3     (c) If a disabled participating employee is eligible to
4 receive Workers' Compensation for an accidental injury and the
5 participating municipality or instrumentality which employed
6 the participating employee when injured continues to pay the
7 participating employee regular salary or other compensation or
8 pays the employee an amount in excess of the Workers'
9 Compensation amount, then earnings shall be deemed to be the
10 total payments, including an amount equal to the Workers'
11 Compensation payments. These payments shall be subject to
12 employee contributions and allocated as if paid to the
13 participating employee when the regular payroll amounts would
14 have been paid if the participating employee had continued
15 working, and creditable service shall be awarded for this
16 period.
17     (d) If an elected official who is a participating employee
18 becomes disabled but does not resign and is not removed from
19 office, then earnings shall include all salary payments made
20 for the remainder of that term of office and the official shall
21 be awarded creditable service for the term of office.
22     (e) If a participating employee is paid pursuant to "An Act
23 to provide for the continuation of compensation for law
24 enforcement officers, correctional officers and firemen who
25 suffer disabling injury in the line of duty", approved
26 September 6, 1973, as amended, the payments shall be deemed
27 earnings, and the participating employee shall be awarded
28 creditable service for this period.
29     (f) Additional compensation received by a person while
30 serving as a supervisor of assessments, assessor, deputy
31 assessor or member of a board of review from the State of
32 Illinois pursuant to Section 4-10 or 4-15 of the Property Tax
33 Code shall not be earnings for purposes of this Article and
34 shall not be included in the contribution formula or
35 calculation of benefits for such person pursuant to this
36 Article.

 

 

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1     (g) Any moneys received by an elected official from the
2 State of Illinois for service in that capacity shall be deemed
3 earnings unless specifically excluded in this Code.
4 (Source: P.A. 87-740; 88-670, eff. 12-2-94.)
 
5     (40 ILCS 5/7-118)  (from Ch. 108 1/2, par. 7-118)
6     Sec. 7-118. "Beneficiary". :
7     (a) "Beneficiary" means:
8         (1) Any person or persons, trust, or charity designated
9     as a beneficiary by an employee, former employee who has
10     not yet received a retirement annuity or separation
11     benefit, or employee annuitant. If no designation is on
12     file or no beneficiary so designated survives, the estate
13     of the employee, former employee who has not yet received a
14     retirement annuity or separation benefit, or employee
15     annuitant.
16         (2) Any person or persons, trust, or charity designated
17     as a beneficiary by a beneficiary annuitant or, if no
18     designation is on file or no beneficiary so designated
19     survives, the estate of the beneficiary annuitant. The
20     surviving spouse of an employee or of an employee
21     annuitant, or if no surviving spouse survives, the person
22     or persons designated by a participating employee or
23     employee annuitant, or if no person so designated survives,
24     or if no designation is on file, the estate of the employee
25     or employee annuitant. The person or persons designated by
26     a beneficiary annuitant, or if no person designated
27     survives, or if no designation is on file, the estate of
28     the beneficiary annuitant.
29         (3) The estate of a surviving spouse annuitant where
30     the employee or employee annuitant filed no designation, or
31     no person designated survives at the death of a surviving
32     spouse annuitant.
33     (b) Designations of beneficiaries shall be in writing on
34 forms prescribed by the board and effective upon filing in the
35 fund offices. The designation forms shall provide for

 

 

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1 contingent beneficiaries. Divorce, dissolution or annulment of
2 marriage revokes the designation of an employee's former spouse
3 as a beneficiary on a designation executed before entry of
4 judgment for divorce, dissolution or annulment of marriage.
5     (b) Notwithstanding the foregoing, an employee, former
6 employee who has not yet received a retirement annuity or
7 separation benefit, or employee annuitant may elect to name any
8 person, trust or charity to be the primary beneficiary of any
9 death benefit payable by reason of his death. Such election
10 shall state specifically whether it is his intention to exclude
11 the spouse, shall be in writing, and may be revoked at any
12 time. Such election or revocation shall take effect upon being
13 filed in the fund offices.
14     (c) If a surviving spouse annuity is payable to a former
15 spouse upon the death of an employee annuitant, the former
16 spouse, unless designated by the employee annuitant after
17 dissolution of the marriage, shall not be the beneficiary for
18 the purposes of the $3,000 death benefit payable under
19 subparagraph 6 of Section 7-164. This benefit shall be paid to
20 the designated beneficiary of the employee annuitant or, if
21 there is no designation, then to the estate of the employee
22 annuitant.
23 (Source: P.A. 89-136, eff. 7-14-95; 90-448, eff. 8-16-97.)
 
24     (40 ILCS 5/7-135)  (from Ch. 108 1/2, par. 7-135)
25     Sec. 7-135. Authorized agents.
26     (a) Each participating municipality and participating
27 instrumentality shall appoint an authorized agent who shall
28 have the powers and duties set forth in this section. In
29 absence of such appointment, the duties of the authorized agent
30 shall devolve upon the clerk or secretary of the municipality
31 or instrumentality and in the case of township school trustees
32 upon the township school treasurer. In townships the Authorized
33 Agent shall be the township supervisor.
34     (b) The authorized agent shall have the following powers
35 and duties:

 

 

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1         1. To certify to the fund whether or not a given person
2     is authorized to participate in the fund;
3         2. To certify to the fund when a participating employee
4     is on a leave of absence authorized by the municipality;
5         3. To request the proper officer to cause employee
6     contributions to be withheld from earnings and transmitted
7     to the fund;
8         4. To request the proper officer to cause municipality
9     contributions to be forwarded to the fund promptly;
10         5. To forward promptly to all participating employees
11     any communications from the fund for such employees;
12         6. To forward promptly to the fund all applications,
13     claims, reports and other communications delivered to him
14     by participating employees;
15         7. To perform all duties related to the administration
16     of this retirement system as requested by the fund and the
17     governing body of his municipality.
18     (c) The governing body of each participating municipality
19 and participating instrumentality may delegate any or all of
20 the following powers and duties to its authorized agent, but
21 only if the agent is a member of the fund:
22         1. To file a petition for nomination of an executive
23     trustee of the fund.
24         2. To cast the ballot for election of an executive
25     trustee of the fund.
26     If a governing body does not authorize its agent to perform
27 the powers and duties set forth in this paragraph (c), they
28 shall be performed by the governing body itself, unless the
29 governing body by resolution duly certified to the fund
30 delegates them to some other officer or employee.
31     (d) The delivery of any communication or document by an
32 employee or a participating municipality or participating
33 instrumentality to its authorized agent shall not constitute
34 delivery to the fund.
35 (Source: P.A. 87-740.)
 

 

 

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1     (40 ILCS 5/7-139)  (from Ch. 108 1/2, par. 7-139)
2     Sec. 7-139. Credits and creditable service to employees.
3     (a) Each participating employee shall be granted credits
4 and creditable service, for purposes of determining the amount
5 of any annuity or benefit to which he or a beneficiary is
6 entitled, as follows:
7         1. For prior service: Each participating employee who
8     is an employee of a participating municipality or
9     participating instrumentality on the effective date shall
10     be granted creditable service, but no credits under
11     paragraph 2 of this subsection (a), for periods of prior
12     service for which credit has not been received under any
13     other pension fund or retirement system established under
14     this Code, as follows:
15         If the effective date of participation for the
16     participating municipality or participating
17     instrumentality is on or before January 1, 1998, creditable
18     service shall be granted for the entire period of prior
19     service with that employer without any employee
20     contribution.
21         If the effective date of participation for the
22     participating municipality or participating
23     instrumentality is after January 1, 1998, creditable
24     service shall be granted for the last 20% of the period of
25     prior service with that employer, but no more than 5 years,
26     without any employee contribution. A participating
27     employee may establish creditable service for the
28     remainder of the period of prior service with that employer
29     by making an application in writing, accompanied by payment
30     of an employee contribution in an amount determined by the
31     Fund, based on the employee contribution rates in effect at
32     the time of application for the creditable service and the
33     employee's salary rate on the effective date of
34     participation for that employer, plus interest at the
35     effective rate from the date of the prior service to the
36     date of payment. Application for this creditable service

 

 

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1     may be made at any time while the employee is still in
2     service.
3         A municipality that (i) has at least 35 employees; (ii)
4     is located in a county with at least 2,000,000 inhabitants;
5     and (iii) maintains an independent defined benefit pension
6     plan for the benefit of its eligible employees may restrict
7     creditable service in whole or in part for periods of prior
8     service with the employer if the governing body of the
9     municipality adopts an irrevocable resolution to restrict
10     that creditable service and files the resolution with the
11     board before the municipality's effective date of
12     participation.
13         Any person who has withdrawn from the service of a
14     participating municipality or participating
15     instrumentality prior to the effective date, who reenters
16     the service of the same municipality or participating
17     instrumentality after the effective date and becomes a
18     participating employee is entitled to creditable service
19     for prior service as otherwise provided in this subdivision
20     (a)(1) only if he or she renders 2 years of service as a
21     participating employee after the effective date.
22     Application for such service must be made while in a
23     participating status. The salary rate to be used in the
24     calculation of the required employee contribution, if any,
25     shall be the employee's salary rate at the time of first
26     reentering service with the employer after the employer's
27     effective date of participation.
28         2. For current service, each participating employee
29     shall be credited with:
30             a. Additional credits of amounts equal to each
31         payment of additional contributions received from him
32         under Section 7-173, as of the date the corresponding
33         payment of earnings is payable to him.
34             b. Normal credits of amounts equal to each payment
35         of normal contributions received from him, as of the
36         date the corresponding payment of earnings is payable

 

 

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1         to him, and normal contributions made for the purpose
2         of establishing out-of-state service credits as
3         permitted under the conditions set forth in paragraph 6
4         of this subsection (a).
5             c. Municipality credits in an amount equal to 1.4
6         times the normal credits, except those established by
7         out-of-state service credits, as of the date of
8         computation of any benefit if these credits would
9         increase the benefit.
10             d. Survivor credits equal to each payment of
11         survivor contributions received from the participating
12         employee as of the date the corresponding payment of
13         earnings is payable, and survivor contributions made
14         for the purpose of establishing out-of-state service
15         credits.
16         3. For periods of temporary and total and permanent
17     disability benefits, each employee receiving disability
18     benefits shall be granted creditable service for the period
19     during which disability benefits are payable. Normal and
20     survivor credits, based upon the rate of earnings applied
21     for disability benefits, shall also be granted if such
22     credits would result in a higher benefit to any such
23     employee or his beneficiary.
24         4. For authorized leave of absence without pay: A
25     participating employee shall be granted credits and
26     creditable service for periods of authorized leave of
27     absence without pay under the following conditions:
28             a. An application for credits and creditable
29         service is submitted to the board while the employee is
30         in a status of active employment, and within 2 years
31         after termination of the leave of absence period for
32         which credits and creditable service are sought.
33             b. Not more than 12 complete months of creditable
34         service for authorized leave of absence without pay
35         shall be counted for purposes of determining any
36         benefits payable under this Article.

 

 

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1             c. Credits and creditable service shall be granted
2         for leave of absence only if such leave is approved by
3         the governing body of the municipality, including
4         approval of the estimated cost thereof to the
5         municipality as determined by the fund, and employee
6         contributions, plus interest at the effective rate
7         applicable for each year from the end of the period of
8         leave to date of payment, have been paid to the fund in
9         accordance with Section 7-173. The contributions shall
10         be computed upon the assumption earnings continued
11         during the period of leave at the rate in effect when
12         the leave began.
13             d. Benefits under the provisions of Sections
14         7-141, 7-146, 7-150 and 7-163 shall become payable to
15         employees on authorized leave of absence, or their
16         designated beneficiary, only if such leave of absence
17         is creditable hereunder, and if the employee has at
18         least one year of creditable service other than the
19         service granted for leave of absence. Any employee
20         contributions due may be deducted from any benefits
21         payable.
22             e. No credits or creditable service shall be
23         allowed for leave of absence without pay during any
24         period of prior service.
25         5. For military service: The governing body of a
26     municipality or participating instrumentality may elect to
27     allow creditable service to participating employees who
28     leave their employment to serve in the armed forces of the
29     United States for all periods of such service, provided
30     that the person returns to active employment within 90 days
31     after completion of full time active duty, but no
32     creditable service shall be allowed such person for any
33     period that can be used in the computation of a pension or
34     any other pay or benefit, other than pay for active duty,
35     for service in any branch of the armed forces of the United
36     States. If necessary to the computation of any benefit, the

 

 

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1     board shall establish municipality credits for
2     participating employees under this paragraph on the
3     assumption that the employee received earnings at the rate
4     received at the time he left the employment to enter the
5     armed forces. A participating employee in the armed forces
6     shall not be considered an employee during such period of
7     service and no additional death and no disability benefits
8     are payable for death or disability during such period.
9         Any participating employee who left his employment
10     with a municipality or participating instrumentality to
11     serve in the armed forces of the United States and who
12     again became a participating employee within 90 days after
13     completion of full time active duty by entering the service
14     of a different municipality or participating
15     instrumentality, which has elected to allow creditable
16     service for periods of military service under the preceding
17     paragraph, shall also be allowed creditable service for his
18     period of military service on the same terms that would
19     apply if he had been employed, before entering military
20     service, by the municipality or instrumentality which
21     employed him after he left the military service and the
22     employer costs arising in relation to such grant of
23     creditable service shall be charged to and paid by that
24     municipality or instrumentality.
25         Notwithstanding the foregoing, any participating
26     employee shall be entitled to creditable service as
27     required by any federal law relating to re-employment
28     rights of persons who served in the United States Armed
29     Services. Such creditable service shall be granted upon
30     payment by the member of an amount equal to the employee
31     contributions which would have been required had the
32     employee continued in service at the same rate of earnings
33     during the military leave period, plus interest at the
34     effective rate.
35         5.1. In addition to any creditable service established
36     under paragraph 5 of this subsection (a), creditable

 

 

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1     service may be granted for up to 24 months of service in
2     the armed forces of the United States.
3         In order to receive creditable service for military
4     service under this paragraph 5.1, a participating employee
5     must (1) apply to the Fund in writing and provide evidence
6     of the military service that is satisfactory to the Board;
7     (2) obtain the written approval of the current employer;
8     and (3) make contributions to the Fund equal to (i) the
9     employee contributions that would have been required had
10     the service been rendered as a member, plus (ii) an amount
11     determined by the board to be equal to the employer's
12     normal cost of the benefits accrued for that military
13     service, plus (iii) interest on items (i) and (ii) from the
14     date of first membership in the Fund to the date of
15     payment. If payment is made during the 6-month period that
16     begins 3 months after the effective date of this amendatory
17     Act of 1997, the required interest shall be at the rate of
18     2.5% per year, compounded annually; otherwise, the
19     required interest shall be calculated at the regular
20     interest rate.
21         6. For out-of-state service: Creditable service shall
22     be granted for service rendered to an out-of-state local
23     governmental body under the following conditions: The
24     employee had participated and has irrevocably forfeited
25     all rights to benefits in the out-of-state public employees
26     pension system; the governing body of his participating
27     municipality or instrumentality authorizes the employee to
28     establish such service; the employee has 2 years current
29     service with this municipality or participating
30     instrumentality; the employee makes a payment of
31     contributions, which shall be computed at 8% (normal) plus
32     2% (survivor) times length of service purchased times the
33     average rate of earnings for the first 2 years of service
34     with the municipality or participating instrumentality
35     whose governing body authorizes the service established
36     plus interest at the effective rate on the date such

 

 

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1     credits are established, payable from the date the employee
2     completes the required 2 years of current service to date
3     of payment. In no case shall more than 120 months of
4     creditable service be granted under this provision.
5         7. For retroactive service: Any employee who could have
6     but did not elect to become a participating employee, or
7     who should have been a participant in the Municipal Public
8     Utilities Annuity and Benefit Fund before that fund was
9     superseded, may receive creditable service for the period
10     of service not to exceed 50 months; however, a current or
11     former elected or appointed official of a participating
12     municipality may establish credit under this paragraph 7
13     for more than 50 months of service as an official of that
14     municipality, if the excess over 50 months is approved by
15     resolution of the governing body of the affected
16     municipality filed with the Fund before January 1, 2002.
17         Any employee who is a participating employee on or
18     after September 24, 1981 and who was excluded from
19     participation by the age restrictions removed by Public Act
20     82-596 may receive creditable service for the period, on or
21     after January 1, 1979, excluded by the age restriction and,
22     in addition, if the governing body of the participating
23     municipality or participating instrumentality elects to
24     allow creditable service for all employees excluded by the
25     age restriction prior to January 1, 1979, for service
26     during the period prior to that date excluded by the age
27     restriction. Any employee who was excluded from
28     participation by the age restriction removed by Public Act
29     82-596 and who is not a participating employee on or after
30     September 24, 1981 may receive creditable service for
31     service after January 1, 1979. Creditable service under
32     this paragraph shall be granted upon payment of the
33     employee contributions which would have been required had
34     he participated, with interest at the effective rate for
35     each year from the end of the period of service established
36     to date of payment.

 

 

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1         8. For accumulated unused sick leave: A participating
2     employee who is applying for a retirement annuity shall be
3     entitled to creditable service for that portion of the
4     employee's accumulated unused sick leave for which payment
5     is not received, as follows:
6             a. Sick leave days shall be limited to those
7         accumulated under a sick leave plan established by a
8         participating municipality or participating
9         instrumentality which is available to all employees or
10         a class of employees.
11             b. Only sick leave days accumulated with a
12         participating municipality or participating
13         instrumentality with which the employee was in service
14         within 60 days of the effective date of his retirement
15         annuity shall be credited; If the employee was in
16         service with more than one employer during this period
17         only the sick leave days with the employer with which
18         the employee has the greatest number of unpaid sick
19         leave days shall be considered.
20             c. The creditable service granted shall be
21         considered solely for the purpose of computing the
22         amount of the retirement annuity and shall not be used
23         to establish any minimum service period required by any
24         provision of the Illinois Pension Code, the effective
25         date of the retirement annuity, or the final rate of
26         earnings.
27             d. The creditable service shall be at the rate of
28         1/20 of a month for each full sick day, provided that
29         no more than 12 months may be credited under this
30         subdivision 8.
31             e. Employee contributions shall not be required
32         for creditable service under this subdivision 8.
33             f. Each participating municipality and
34         participating instrumentality with which an employee
35         has service within 60 days of the effective date of his
36         retirement annuity shall certify to the board the

 

 

HB4973 - 14 - LRB094 15880 AMC 51102 b

1         number of accumulated unpaid sick leave days credited
2         to the employee at the time of termination of service.
3         9. For service transferred from another system:
4     Credits and creditable service shall be granted for service
5     under Article 3, 4, 5, 14 or 16 of this Act, to any active
6     member of this Fund, and to any inactive member who has
7     been a county sheriff, upon transfer of such credits
8     pursuant to Section 3-110.3, 4-108.3, 5-235, 14-105.6 or
9     16-131.4, and payment by the member of the amount by which
10     (1) the employer and employee contributions that would have
11     been required if he had participated in this Fund as a
12     sheriff's law enforcement employee during the period for
13     which credit is being transferred, plus interest thereon at
14     the effective rate for each year, compounded annually, from
15     the date of termination of the service for which credit is
16     being transferred to the date of payment, exceeds (2) the
17     amount actually transferred to the Fund. Such transferred
18     service shall be deemed to be service as a sheriff's law
19     enforcement employee for the purposes of Section 7-142.1.
20         10. For service transferred from an Article 3 system
21     under Section 3-110.8: Credits and creditable service
22     shall be granted for service under Article 3 of this Act as
23     provided in Section 3-110.8, to any active member of this
24     Fund upon transfer of such credits pursuant to Section
25     3-110.8. If the amount by which (1) the employer and
26     employee contributions that would have been required if he
27     had participated in this Fund during the period for which
28     credit is being transferred, plus interest thereon at the
29     effective rate for each year, compounded annually, from the
30     date of termination of the service for which credit is
31     being transferred to the date of payment, exceeds (2) the
32     amount actually transferred to the Fund, then the amount of
33     creditable service established under this paragraph 10
34     shall be reduced by a corresponding amount in accordance
35     with the rules and procedures established under this
36     paragraph 10.

 

 

HB4973 - 15 - LRB094 15880 AMC 51102 b

1         The board shall establish by rule the manner of making
2     the calculation required under this paragraph 10, taking
3     into account the appropriate actuarial assumptions; the
4     member's service, age, and salary history; the level of
5     funding of the employer; and any other factors that the
6     board determines to be relevant.
7     (b) Creditable service - amount:
8         1. One month of creditable service shall be allowed for
9     each month for which a participating employee made
10     contributions as required under Section 7-173, or for which
11     creditable service is otherwise granted hereunder. Not
12     more than 1 month of service shall be credited and counted
13     for 1 calendar month, and not more than 1 year of service
14     shall be credited and counted for any calendar year. A
15     calendar month means a nominal month beginning on the first
16     day thereof, and a calendar year means a year beginning
17     January 1 and ending December 31.
18         2. A seasonal employee shall be given 12 months of
19     creditable service if he renders the number of months of
20     service normally required by the position in a 12-month
21     period and he remains in service for the entire 12-month
22     period. Otherwise a fractional year of service in the
23     number of months of service rendered shall be credited.
24         3. An intermittent employee shall be given creditable
25     service for only those months in which a contribution is
26     made under Section 7-173.
27     (c) No application for correction of credits or creditable
28 service shall be considered unless the board receives an
29 application for correction while (1) the applicant is a
30 participating employee and in active employment with a
31 participating municipality or instrumentality, or (2) while
32 the applicant is actively participating in a pension fund or
33 retirement system which is a participating system under the
34 Retirement Systems Reciprocal Act. A participating employee or
35 other applicant shall not be entitled to credits or creditable
36 service unless the required employee contributions are made in

 

 

HB4973 - 16 - LRB094 15880 AMC 51102 b

1 a lump sum or in installments made in accordance with board
2 rule.
3     (d) Upon the granting of a retirement, surviving spouse or
4 child annuity, a death benefit or a separation benefit, on
5 account of any employee, all individual accumulated credits
6 shall thereupon terminate. Upon the withdrawal of additional
7 contributions, the credits applicable thereto shall thereupon
8 terminate. Terminated credits shall not be applied to increase
9 the benefits any remaining employee would otherwise receive
10 under this Article.
11 (Source: P.A. 93-933, eff. 8-13-04; 94-356, eff. 7-29-05.)
 
12     (40 ILCS 5/7-153.1 new)
13     Sec. 7-153.1. Disability hearings; request for closed
14 meeting. Those portions of meetings of the Board or of Board
15 committees in which matters relating to the determination of
16 disability or the results of medical examinations are to be
17 considered may be closed, but only if the request for a closed
18 meeting is initiated by the participating employee whose
19 disability determination or whose medical examination results
20 are at issue.
 
21     (40 ILCS 5/7-170)  (from Ch. 108 1/2, par. 7-170)
22     Sec. 7-170. Federal Social Security coverage.
23     (a) It is declared to be the policy and purpose of this
24 Section to extend to covered employees as defined in Section
25 7-138, the benefits of the Federal Old Age and Survivors
26 Insurance System as authorized by the Federal Social Security
27 Act and amendments thereto. To effect this, the board shall
28 take such action as may be required by applicable State and
29 Federal laws or regulations.
30     (b) The board shall execute an agreement with the State
31 Agency to secure coverage of covered employees as provided in
32 paragraph (a) of this section.
33     (c) Each participating municipality and each participating
34 instrumentality shall remit payment of contributions for

 

 

HB4973 - 17 - LRB094 15880 AMC 51102 b

1 Social Security purposes on behalf of covered employees and
2 covered municipalities and participating instrumentalities in
3 the manner provided by law as required by the board and the
4 State Agency established by the Social Security Enabling Act.
5     (d) (Blank). Contributions of covered employees to this
6 fund for Federal Social Security purposes shall be paid to the
7 State Agency in such amounts and at such time as are designated
8 by State laws or regulations.
9     (e) (Blank). Contributions in behalf of covered
10 municipalities and participating instrumentalities for Federal
11 Social Security purposes and the required pro rata share of
12 administrative expenses shall be paid to the State Agency from
13 this fund in accordance with applicable State laws and
14 regulations.
15     (f) The board shall maintain such records and submit such
16 reports as may be required by applicable State and Federal laws
17 or regulations.
18 (Source: P.A. 81-793.)
 
19     (40 ILCS 5/7-171)  (from Ch. 108 1/2, par. 7-171)
20     Sec. 7-171. Finance; taxes.
21     (a) Each municipality other than a school district shall
22 appropriate an amount sufficient to provide for the current
23 municipality contributions required by Section 7-172 of this
24 Article, for the fiscal year for which the appropriation is
25 made and all amounts due for municipal contributions for
26 previous years. Those municipalities which have been assessed
27 an annual amount to amortize its unfunded obligation, as
28 provided in subparagraph 4 5 of paragraph (a) of Section 7-172
29 of this Article, shall include in the appropriation an amount
30 sufficient to pay the amount assessed. The appropriation shall
31 be based upon an estimate of assets available for municipality
32 contributions and liabilities therefor for the fiscal year for
33 which appropriations are to be made, including funds available
34 from levies for this purpose in prior years.
35     (b) For the purpose of providing monies for municipality

 

 

HB4973 - 18 - LRB094 15880 AMC 51102 b

1 contributions, beginning for the year in which a municipality
2 is included in this fund:
3         (1) A municipality other than a school district may
4     levy a tax which shall not exceed the amount appropriated
5     for municipality contributions.
6         (2) A school district may levy a tax in an amount
7     reasonably calculated at the time of the levy to provide
8     for the municipality contributions required under Section
9     7-172 of this Article for the fiscal years for which
10     revenues from the levy will be received and all amounts due
11     for municipal contributions for previous years. Any levy
12     adopted before the effective date of this amendatory Act of
13     1995 by a school district shall be considered valid and
14     authorized to the extent that the amount was reasonably
15     calculated at the time of the levy to provide for the
16     municipality contributions required under Section 7-172
17     for the fiscal years for which revenues from the levy will
18     be received and all amounts due for municipal contributions
19     for previous years. In no event shall a budget adopted by a
20     school district limit a levy of that school district
21     adopted under this Section.
22     (c) Any county which is served by a regional office of
23 education that serves 2 or more counties may include in its
24 appropriation an amount sufficient to provide its
25 proportionate share of the municipality contributions for that
26 regional office of education. The tax levy authorized by this
27 Section may include an amount necessary to provide monies for
28 this contribution.
29     (d) Any county that is a part of a multiple-county health
30 department or consolidated health department which is formed
31 under "An Act in relation to the establishment and maintenance
32 of county and multiple-county public health departments",
33 approved July 9, 1943, as amended, and which is a participating
34 instrumentality may include in the county's appropriation an
35 amount sufficient to provide its proportionate share of
36 municipality contributions of the department. The tax levy

 

 

HB4973 - 19 - LRB094 15880 AMC 51102 b

1 authorized by this Section may include the amount necessary to
2 provide monies for this contribution.
3     (d-5) A school district participating in a special
4 education joint agreement created under Section 10-22.31 of the
5 School Code that is a participating instrumentality may include
6 in the school district's tax levy under this Section an amount
7 sufficient to provide its proportionate share of the
8 municipality contributions for current and prior service by
9 employees of the participating instrumentality created under
10 the joint agreement.
11     (e) Such tax shall be levied and collected in like manner,
12 with the general taxes of the municipality and shall be in
13 addition to all other taxes which the municipality is now or
14 may hereafter be authorized to levy upon all taxable property
15 therein, and shall be exclusive of and in addition to the
16 amount of tax levied for general purposes under Section 8-3-1
17 of the "Illinois Municipal Code", approved May 29, 1961, as
18 amended, or under any other law or laws which may limit the
19 amount of tax which the municipality may levy for general
20 purposes. The tax may be levied by the governing body of the
21 municipality without being authorized as being additional to
22 all other taxes by a vote of the people of the municipality.
23     (f) The county clerk of the county in which any such
24 municipality is located, in reducing tax levies shall not
25 consider any such tax as a part of the general tax levy for
26 municipality purposes, and shall not include the same in the
27 limitation of any other tax rate which may be extended.
28     (g) The amount of the tax to be levied in any year shall,
29 within the limits herein prescribed, be determined by the
30 governing body of the respective municipality.
31     (h) The revenue derived from any such tax levy shall be
32 used only for the purposes specified in this Article and, as
33 collected, shall be paid to the treasurer of the municipality
34 levying the tax. Monies received by a county treasurer for use
35 in making contributions to a regional office of education for
36 its municipality contributions shall be held by him for that

 

 

HB4973 - 20 - LRB094 15880 AMC 51102 b

1 purpose and paid to the regional office of education in the
2 same manner as other monies appropriated for the expense of the
3 regional office.
4 (Source: P.A. 89-329, eff. 8-17-95; 90-448, eff. 8-16-97;
5 90-511, eff. 8-22-97; 90-655, eff. 7-30-98.)
 
6     (40 ILCS 5/7-172)  (from Ch. 108 1/2, par. 7-172)
7     (Text of Section before amendment by P.A. 94-712)
8     Sec. 7-172. Contributions by participating municipalities
9 and participating instrumentalities.
10     (a) Each participating municipality and each participating
11 instrumentality shall make payment to the fund as follows:
12         1. municipality contributions in an amount determined
13     by applying the municipality contribution rate to each
14     payment of earnings paid to each of its participating
15     employees;
16         2. an amount equal to the employee contributions
17     provided by paragraphs (a) and (b) of Section 7-173,
18     whether or not the employee contributions are withheld as
19     permitted by that Section;
20         3. all accounts receivable, together with interest
21     charged thereon, as provided in Section 7-209;
22         4. if it has no participating employees with current
23     earnings, an amount payable which, over a period of 20
24     years beginning with the year following an award of
25     benefit, will amortize, at the effective rate for that year
26     any unfunded obligation. The unfunded obligation shall be
27     computed as provided in paragraph 2 of subsection (b) , any
28     negative balance in its municipality reserve resulting
29     from the award. This amount when established will be
30     payable as a separate contribution whether or not it later
31     has participating employees; .
32         5. if it has fewer than 7 participating employees or
33     has a negative balance in its municipality reserve, the
34     greater of (A) an amount payable which, over a period of 20
35     years, will amortize at the effective rate for that year

 

 

HB4973 - 21 - LRB094 15880 AMC 51102 b

1     any unfunded obligation, computed as provided in paragraph
2     2 of subsection (b) or (B) the amount required by paragraph
3     1 of this subsection.
4     (b) A separate municipality contribution rate shall be
5 determined for each calendar year for all participating
6 municipalities together with all instrumentalities thereof.
7 The municipality contribution rate shall be determined for
8 participating instrumentalities as if they were participating
9 municipalities. The municipality contribution rate shall be
10 the sum of the following percentages:
11         1. The percentage of earnings of all the participating
12     employees of all participating municipalities and
13     participating instrumentalities which, if paid over the
14     entire period of their service, will be sufficient when
15     combined with all employee contributions available for the
16     payment of benefits, to provide all annuities for
17     participating employees, and the $3,000 death benefit
18     payable under Sections 7-158 and 7-164, such percentage to
19     be known as the normal cost rate.
20         2. The percentage of earnings of the participating
21     employees of each participating municipality and
22     participating instrumentalities necessary to adjust for
23     the difference between the present value of all benefits,
24     excluding temporary and total and permanent disability and
25     death benefits, to be provided for its participating
26     employees and the sum of its accumulated municipality
27     contributions and the accumulated employee contributions
28     and the present value of expected future employee and
29     municipality contributions pursuant to subparagraph 1 of
30     this paragraph (b). This adjustment shall be spread over
31     the remainder of the period that is allowable under
32     generally accepted accounting principles.
33         3. The percentage of earnings of the participating
34     employees of all municipalities and participating
35     instrumentalities necessary to provide the present value
36     of all temporary and total and permanent disability

 

 

HB4973 - 22 - LRB094 15880 AMC 51102 b

1     benefits granted during the most recent year for which
2     information is available.
3         4. The percentage of earnings of the participating
4     employees of all participating municipalities and
5     participating instrumentalities necessary to provide the
6     present value of the net single sum death benefits expected
7     to become payable from the reserve established under
8     Section 7-206 during the year for which this rate is fixed.
9         5. The percentage of earnings necessary to meet any
10     deficiency arising in the Terminated Municipality Reserve.
11     (c) A separate municipality contribution rate shall be
12 computed for each participating municipality or participating
13 instrumentality for its sheriff's law enforcement employees.
14     A separate municipality contribution rate shall be
15 computed for the sheriff's law enforcement employees of each
16 forest preserve district that elects to have such employees.
17 For the period from January 1, 1986 to December 31, 1986, such
18 rate shall be the forest preserve district's regular rate plus
19 2%.
20     In the event that the Board determines that there is an
21 actuarial deficiency in the account of any municipality with
22 respect to a person who has elected to participate in the Fund
23 under Section 3-109.1 of this Code, the Board may adjust the
24 municipality's contribution rate so as to make up that
25 deficiency over such reasonable period of time as the Board may
26 determine.
27     (d) The Board may establish a separate municipality
28 contribution rate for all employees who are program
29 participants employed under the federal Comprehensive
30 Employment Training Act by all of the participating
31 municipalities and instrumentalities. The Board may also
32 provide that, in lieu of a separate municipality rate for these
33 employees, a portion of the municipality contributions for such
34 program participants shall be refunded or an extra charge
35 assessed so that the amount of municipality contributions
36 retained or received by the fund for all CETA program

 

 

HB4973 - 23 - LRB094 15880 AMC 51102 b

1 participants shall be an amount equal to that which would be
2 provided by the separate municipality contribution rate for all
3 such program participants. Refunds shall be made to prime
4 sponsors of programs upon submission of a claim therefor and
5 extra charges shall be assessed to participating
6 municipalities and instrumentalities. In establishing the
7 municipality contribution rate as provided in paragraph (b) of
8 this Section, the use of a separate municipality contribution
9 rate for program participants or the refund of a portion of the
10 municipality contributions, as the case may be, may be
11 considered.
12     (e) Computations of municipality contribution rates for
13 the following calendar year shall be made prior to the
14 beginning of each year, from the information available at the
15 time the computations are made, and on the assumption that the
16 employees in each participating municipality or participating
17 instrumentality at such time will continue in service until the
18 end of such calendar year at their respective rates of earnings
19 at such time.
20     (f) Any municipality which is the recipient of State
21 allocations representing that municipality's contributions for
22 retirement annuity purposes on behalf of its employees as
23 provided in Section 12-21.16 of the Illinois Public Aid Code
24 shall pay the allocations so received to the Board for such
25 purpose. Estimates of State allocations to be received during
26 any taxable year shall be considered in the determination of
27 the municipality's tax rate for that year under Section 7-171.
28 If a special tax is levied under Section 7-171, none of the
29 proceeds may be used to reimburse the municipality for the
30 amount of State allocations received and paid to the Board. Any
31 multiple-county or consolidated health department which
32 receives contributions from a county under Section 11.2 of "An
33 Act in relation to establishment and maintenance of county and
34 multiple-county health departments", approved July 9, 1943, as
35 amended, or distributions under Section 3 of the Department of
36 Public Health Act, shall use these only for municipality

 

 

HB4973 - 24 - LRB094 15880 AMC 51102 b

1 contributions by the health department.
2     (g) Municipality contributions for the several purposes
3 specified shall, for township treasurers and employees in the
4 offices of the township treasurers who meet the qualifying
5 conditions for coverage hereunder, be allocated among the
6 several school districts and parts of school districts serviced
7 by such treasurers and employees in the proportion which the
8 amount of school funds of each district or part of a district
9 handled by the treasurer bears to the total amount of all
10 school funds handled by the treasurer.
11     From the funds subject to allocation among districts and
12 parts of districts pursuant to the School Code, the trustees
13 shall withhold the proportionate share of the liability for
14 municipality contributions imposed upon such districts by this
15 Section, in respect to such township treasurers and employees
16 and remit the same to the Board.
17     The municipality contribution rate for an educational
18 service center shall initially be the same rate for each year
19 as the regional office of education or school district which
20 serves as its administrative agent. When actuarial data become
21 available, a separate rate shall be established as provided in
22 subparagraph (i) of this Section.
23     The municipality contribution rate for a public agency,
24 other than a vocational education cooperative, formed under the
25 Intergovernmental Cooperation Act shall initially be the
26 average rate for the municipalities which are parties to the
27 intergovernmental agreement. When actuarial data become
28 available, a separate rate shall be established as provided in
29 subparagraph (i) of this Section.
30     (h) Each participating municipality and participating
31 instrumentality shall make the contributions in the amounts
32 provided in this Section in the manner prescribed from time to
33 time by the Board and all such contributions shall be
34 obligations of the respective participating municipalities and
35 participating instrumentalities to this fund. The failure to
36 deduct any employee contributions shall not relieve the

 

 

HB4973 - 25 - LRB094 15880 AMC 51102 b

1 participating municipality or participating instrumentality of
2 its obligation to this fund. Delinquent payments of
3 contributions due under this Section may, with interest, be
4 recovered by civil action against the participating
5 municipalities or participating instrumentalities.
6 Municipality contributions, other than the amount necessary
7 for employee contributions and Social Security contributions,
8 for periods of service by employees from whose earnings no
9 deductions were made for employee contributions to the fund,
10 may be charged to the municipality reserve for the municipality
11 or participating instrumentality.
12     (i) Contributions by participating instrumentalities shall
13 be determined as provided herein except that the percentage
14 derived under subparagraph 2 of paragraph (b) of this Section,
15 and the amount payable under subparagraph 4 5 of paragraph (a)
16 of this Section, shall be based on an amortization period of 10
17 years.
18     (k) Each county with current or former elected county
19 officers, as defined in Section 7-145.1, participating in the
20 alternative annuity program established under that Section
21 shall have a separate municipality contribution rate computed
22 for those elected county officers.
23 (Source: P.A. 92-424, eff. 8-17-01.)
 
24     (Text of Section after amendment by P.A. 94-712)
25     Sec. 7-172. Contributions by participating municipalities
26 and participating instrumentalities.
27     (a) Each participating municipality and each participating
28 instrumentality shall make payment to the fund as follows:
29         1. municipality contributions in an amount determined
30     by applying the municipality contribution rate to each
31     payment of earnings paid to each of its participating
32     employees;
33         2. an amount equal to the employee contributions
34     provided by paragraphs (a) and (b) of Section 7-173,
35     whether or not the employee contributions are withheld as

 

 

HB4973 - 26 - LRB094 15880 AMC 51102 b

1     permitted by that Section;
2         3. all accounts receivable, together with interest
3     charged thereon, as provided in Section 7-209;
4         4. if it has no participating employees with current
5     earnings, an amount payable which, over a period of 20
6     years beginning with the year following an award of
7     benefit, will amortize, at the effective rate for that year
8     any unfunded obligation. The unfunded obligation shall be
9     computed as provided in paragraph 2 of subsection (b) , any
10     negative balance in its municipality reserve resulting
11     from the award. This amount when established will be
12     payable as a separate contribution whether or not it later
13     has participating employees; .
14         5. if it has fewer than 7 participating employees or
15     has a negative balance in its municipality reserve, the
16     greater of (A) an amount payable which, over a period of 20
17     years, will amortize at the effective rate for that year
18     any unfunded obligation, computed as provided in paragraph
19     2 of subsection (b) or (B) the amount required by paragraph
20     1 of this subsection.
21     (b) A separate municipality contribution rate shall be
22 determined for each calendar year for all participating
23 municipalities together with all instrumentalities thereof.
24 The municipality contribution rate shall be determined for
25 participating instrumentalities as if they were participating
26 municipalities. The municipality contribution rate shall be
27 the sum of the following percentages:
28         1. The percentage of earnings of all the participating
29     employees of all participating municipalities and
30     participating instrumentalities which, if paid over the
31     entire period of their service, will be sufficient when
32     combined with all employee contributions available for the
33     payment of benefits, to provide all annuities for
34     participating employees, and the $3,000 death benefit
35     payable under Sections 7-158 and 7-164, such percentage to
36     be known as the normal cost rate.

 

 

HB4973 - 27 - LRB094 15880 AMC 51102 b

1         2. The percentage of earnings of the participating
2     employees of each participating municipality and
3     participating instrumentalities necessary to adjust for
4     the difference between the present value of all benefits,
5     excluding temporary and total and permanent disability and
6     death benefits, to be provided for its participating
7     employees and the sum of its accumulated municipality
8     contributions and the accumulated employee contributions
9     and the present value of expected future employee and
10     municipality contributions pursuant to subparagraph 1 of
11     this paragraph (b). This adjustment shall be spread over
12     the remainder of the period that is allowable under
13     generally accepted accounting principles.
14         3. The percentage of earnings of the participating
15     employees of all municipalities and participating
16     instrumentalities necessary to provide the present value
17     of all temporary and total and permanent disability
18     benefits granted during the most recent year for which
19     information is available.
20         4. The percentage of earnings of the participating
21     employees of all participating municipalities and
22     participating instrumentalities necessary to provide the
23     present value of the net single sum death benefits expected
24     to become payable from the reserve established under
25     Section 7-206 during the year for which this rate is fixed.
26         5. The percentage of earnings necessary to meet any
27     deficiency arising in the Terminated Municipality Reserve.
28     (c) A separate municipality contribution rate shall be
29 computed for each participating municipality or participating
30 instrumentality for its sheriff's law enforcement employees.
31     A separate municipality contribution rate shall be
32 computed for the sheriff's law enforcement employees of each
33 forest preserve district that elects to have such employees.
34 For the period from January 1, 1986 to December 31, 1986, such
35 rate shall be the forest preserve district's regular rate plus
36 2%.

 

 

HB4973 - 28 - LRB094 15880 AMC 51102 b

1     In the event that the Board determines that there is an
2 actuarial deficiency in the account of any municipality with
3 respect to a person who has elected to participate in the Fund
4 under Section 3-109.1 of this Code, the Board may adjust the
5 municipality's contribution rate so as to make up that
6 deficiency over such reasonable period of time as the Board may
7 determine.
8     (d) The Board may establish a separate municipality
9 contribution rate for all employees who are program
10 participants employed under the federal Comprehensive
11 Employment Training Act by all of the participating
12 municipalities and instrumentalities. The Board may also
13 provide that, in lieu of a separate municipality rate for these
14 employees, a portion of the municipality contributions for such
15 program participants shall be refunded or an extra charge
16 assessed so that the amount of municipality contributions
17 retained or received by the fund for all CETA program
18 participants shall be an amount equal to that which would be
19 provided by the separate municipality contribution rate for all
20 such program participants. Refunds shall be made to prime
21 sponsors of programs upon submission of a claim therefor and
22 extra charges shall be assessed to participating
23 municipalities and instrumentalities. In establishing the
24 municipality contribution rate as provided in paragraph (b) of
25 this Section, the use of a separate municipality contribution
26 rate for program participants or the refund of a portion of the
27 municipality contributions, as the case may be, may be
28 considered.
29     (e) Computations of municipality contribution rates for
30 the following calendar year shall be made prior to the
31 beginning of each year, from the information available at the
32 time the computations are made, and on the assumption that the
33 employees in each participating municipality or participating
34 instrumentality at such time will continue in service until the
35 end of such calendar year at their respective rates of earnings
36 at such time.

 

 

HB4973 - 29 - LRB094 15880 AMC 51102 b

1     (f) Any municipality which is the recipient of State
2 allocations representing that municipality's contributions for
3 retirement annuity purposes on behalf of its employees as
4 provided in Section 12-21.16 of the Illinois Public Aid Code
5 shall pay the allocations so received to the Board for such
6 purpose. Estimates of State allocations to be received during
7 any taxable year shall be considered in the determination of
8 the municipality's tax rate for that year under Section 7-171.
9 If a special tax is levied under Section 7-171, none of the
10 proceeds may be used to reimburse the municipality for the
11 amount of State allocations received and paid to the Board. Any
12 multiple-county or consolidated health department which
13 receives contributions from a county under Section 11.2 of "An
14 Act in relation to establishment and maintenance of county and
15 multiple-county health departments", approved July 9, 1943, as
16 amended, or distributions under Section 3 of the Department of
17 Public Health Act, shall use these only for municipality
18 contributions by the health department.
19     (g) Municipality contributions for the several purposes
20 specified shall, for township treasurers and employees in the
21 offices of the township treasurers who meet the qualifying
22 conditions for coverage hereunder, be allocated among the
23 several school districts and parts of school districts serviced
24 by such treasurers and employees in the proportion which the
25 amount of school funds of each district or part of a district
26 handled by the treasurer bears to the total amount of all
27 school funds handled by the treasurer.
28     From the funds subject to allocation among districts and
29 parts of districts pursuant to the School Code, the trustees
30 shall withhold the proportionate share of the liability for
31 municipality contributions imposed upon such districts by this
32 Section, in respect to such township treasurers and employees
33 and remit the same to the Board.
34     The municipality contribution rate for an educational
35 service center shall initially be the same rate for each year
36 as the regional office of education or school district which

 

 

HB4973 - 30 - LRB094 15880 AMC 51102 b

1 serves as its administrative agent. When actuarial data become
2 available, a separate rate shall be established as provided in
3 subparagraph (i) of this Section.
4     The municipality contribution rate for a public agency,
5 other than a vocational education cooperative, formed under the
6 Intergovernmental Cooperation Act shall initially be the
7 average rate for the municipalities which are parties to the
8 intergovernmental agreement. When actuarial data become
9 available, a separate rate shall be established as provided in
10 subparagraph (i) of this Section.
11     (h) Each participating municipality and participating
12 instrumentality shall make the contributions in the amounts
13 provided in this Section in the manner prescribed from time to
14 time by the Board and all such contributions shall be
15 obligations of the respective participating municipalities and
16 participating instrumentalities to this fund. The failure to
17 deduct any employee contributions shall not relieve the
18 participating municipality or participating instrumentality of
19 its obligation to this fund. Delinquent payments of
20 contributions due under this Section may, with interest, be
21 recovered by civil action against the participating
22 municipalities or participating instrumentalities.
23 Municipality contributions, other than the amount necessary
24 for employee contributions and Social Security contributions,
25 for periods of service by employees from whose earnings no
26 deductions were made for employee contributions to the fund,
27 may be charged to the municipality reserve for the municipality
28 or participating instrumentality.
29     (i) Contributions by participating instrumentalities shall
30 be determined as provided herein except that the percentage
31 derived under subparagraph 2 of paragraph (b) of this Section,
32 and the amount payable under subparagraph 4 5 of paragraph (a)
33 of this Section, shall be based on an amortization period of 10
34 years.
35     (j) Notwithstanding the other provisions of this Section,
36 the additional unfunded liability accruing as a result of this

 

 

HB4973 - 31 - LRB094 15880 AMC 51102 b

1 amendatory Act of the 94th General Assembly shall be amortized
2 over a period of 30 years beginning on January 1 of the second
3 calendar year following the calendar year in which this
4 amendatory Act takes effect, except that the employer may
5 provide for a longer amortization period by adopting a
6 resolution or ordinance specifying a 35-year or 40-year period
7 and submitting a certified copy of the ordinance or resolution
8 to the fund no later than June 1 of the calendar year following
9 the calendar year in which this amendatory Act takes effect.
10     (k) Each county with current or former elected county
11 officers, as defined in Section 7-145.1, participating in the
12 alternative annuity program established under that Section
13 shall have a separate municipality contribution rate computed
14 for those elected county officers.
15 (Source: P.A. 94-712, eff. 6-1-06.)
 
16     (40 ILCS 5/7-173)  (from Ch. 108 1/2, par. 7-173)
17     Sec. 7-173. Contributions by employees.
18     (a) Each participating employee shall make contributions
19 to the fund as follows:
20         1. For retirement annuity purposes, normal
21     contributions of 3 3/4% of earnings.
22         2. Additional contributions of such percentages of
23     each payment of earnings, as shall be elected by the
24     employee for retirement annuity purposes, but not in excess
25     of 10%. The selected rate shall be applicable to all
26     earnings beginning on the first day of the second month
27     following receipt by the Board of written notice of
28     election to make such contributions. Additional
29     contributions at the selected rate shall be made
30     concurrently with normal contributions.
31         3. Survivor contributions, by each participating
32     employee, of 3/4% of each payment of earnings.
33     (b) Each employee shall make contributions to the fund for
34 Federal Social Security taxes, for periods during which he is a
35 covered employee, as required by the Social Security Enabling

 

 

HB4973 - 32 - LRB094 15880 AMC 51102 b

1 Act and federal law. For participating employees, such
2 contributions shall be in addition to those required under
3 paragraph (a) of this Section.
4     (c) Contributions shall be deducted from each
5 corresponding payment of earnings paid to each employee and
6 shall be remitted to the board by the participating
7 municipality or participating instrumentality making such
8 payment. The remittance, together with a report of the earnings
9 and contributions shall be made as directed by the board. For
10 township treasurers and employees of township treasurers
11 qualifying as employees hereunder, the contributions herein
12 required as deductions from salary shall be withheld by the
13 school township trustees from funds available for the payment
14 of the compensation of such treasurers and employees as
15 provided in the School Code and remitted to the board.
16     (d) An employee who has made additional contributions under
17 paragraph (a)2 of this Section may upon retirement or at any
18 time prior thereto, elect to withdraw the total of such
19 additional contributions including interest credited thereon
20 to the end of the preceding calendar year.
21     (e) Failure to make the deductions for employee
22 contributions provided in paragraph (c) of this Section shall
23 not relieve the employee from liability for such contributions.
24 The amount of such liability may be deducted, with interest
25 charged under Section 7-209, from any annuities or benefits
26 payable hereunder to the employee or any other person receiving
27 an annuity or benefit by reason of such employee's
28 participation.
29     (f) A participating employee who has at least 40 years of
30 creditable service in the Fund may elect to cease making the
31 contributions required under this Section. The status of the
32 employee under this Article shall be unaffected by this
33 election, except that the employee shall not receive any
34 additional creditable service for the periods of employment
35 following the election. An election under this subsection
36 relieves the employer from making additional employer

 

 

HB4973 - 33 - LRB094 15880 AMC 51102 b

1 contributions in relation to that employee.
2 (Source: P.A. 87-1265.)
 
3     (40 ILCS 5/7-173.2)  (from Ch. 108 1/2, par. 7-173.2)
4     Sec. 7-173.2. Pickup of employee contributions.
5     (a) Until July 1, 1984, each participating municipality and
6 each participating instrumentality may elect, for all of its
7 employees, to pick up the employee contributions required by
8 subparagraphs 1 and 3 of subsection (a) of Section 7-173 and,
9 in the case of sheriff's law enforcement employees, required by
10 Section 7-173.1. The pick up may be for employee contributions
11 on earnings received by employees after December 31, 1981 and
12 shall be applicable to the contributions on total earnings paid
13 in any month. The decision to pick up contributions shall be
14 made by the governing body.
15     Beginning July 1, 1984, the pick up of employee
16 contributions shall cease to be optional. Each participating
17 municipality and participating instrumentality shall pick up
18 the employee contributions required by subparagraphs 1 and 3 of
19 subsection (a) of Section 7-173 and, in the case of sheriff's
20 law enforcement employees, contributions required by Section
21 7-173.1, for all compensation earned after such date. Each
22 participating municipality shall also pick up any employee
23 contributions made by its employees under the alternative
24 program for elected county officers under Section 7-145.1.
25     (b) Contributions that are picked up shall be treated as
26 employer contributions in determining tax treatment under the
27 United States Internal Revenue Code. The employee contribution
28 shall be paid from the same source of funds as is used in
29 payment of earnings to the employee and may not be paid from
30 funds raised by the tax levy authorized by Section 7-171. The
31 contributions shall be picked up by a reduction in earnings
32 payment to employees. Employee contributions that are picked up
33 shall be considered as earnings under Section 7-114. If a
34 participating municipality or participating instrumentality
35 fails to report participating employee earnings which should

 

 

HB4973 - 34 - LRB094 15880 AMC 51102 b

1 have been reported to the fund and pays the employee the full
2 amount of earnings including employee contributions which
3 should have been picked up and forwarded to the fund, then the
4 employee shall make payment of the employee contributions to
5 the fund on behalf of employer and such contributions shall be
6 considered as picked up contributions if paid in the year the
7 earnings were received, or by January 31st of the following
8 year, and are reflected as picked up on reports to the Internal
9 Revenue Service. If they cannot be so reflected, or if received
10 after that date, they shall not be treated as picked up
11 contributions. Picked up employee contributions shall be
12 considered as employee contributions in computing benefits
13 paid under this Article 7.
14     (c) Subject to the requirements of federal law, an employee
15 may elect to have the employer pick up optional contributions
16 that the employee has elected to pay to the Fund, and the
17 contributions so picked up shall be treated as employer
18 contributions for the purposes of determining federal tax
19 treatment. The employer shall pick up the contributions by a
20 reduction in the cash salary of the employee and shall pay the
21 contributions from the same source of funds that is used to pay
22 earnings to the employee. The employee's election to have the
23 optional contributions picked up is irrevocable and the
24 optional contributions may not thereafter be prepaid, by direct
25 payment or otherwise.
26 (Source: P.A. 90-766, eff. 8-14-98.)
 
27     (40 ILCS 5/7-204)  (from Ch. 108 1/2, par. 7-204)
28     Sec. 7-204. Municipality reserves.
29     (a) Except as provided in paragraph (b) of this Section,
30 each participating municipality and its instrumentalities, and
31 each participating instrumentality, shall be treated as an
32 independent unit within the fund, except that if it has any
33 sheriff's law enforcement employees or any elected county
34 officers (as defined in Section 7-154.1) participating in the
35 alternative annuity program, it shall be treated as multiple 2

 

 

HB4973 - 35 - LRB094 15880 AMC 51102 b

1 independent units, one for its sheriff's law enforcement
2 employees, one for its elected county officers participating in
3 the alternative retirement program, and one the second for its
4 other employees. Separate municipality reserves shall be
5 maintained in such form and detail as is necessary to show the
6 net accumulated balances of each municipality, created or
7 arising under this Article.
8     (b) In the event of termination and dissolution of any
9 participating municipality or participating instrumentality,
10 if and its obligations are not assumed or transferred by law to
11 another municipality, any net debit or credit balance remaining
12 in the reserve account of such municipality, or participating
13 instrumentality, shall be transferred to a Terminated
14 Municipality Reserve Account which shall be used to fund any
15 future benefits of its employees arising out of service with
16 the terminated municipality or participating instrumentality.
17     Any deficiency arising in the Terminated Municipality
18 Reserve Account shall be eliminated by a contribution by all
19 remaining municipalities and participating instrumentalities
20 at a uniform percent of payroll, to be determined, collected
21 with other contributions required under Section 7-172.
22     (c) The municipality reserve for each municipality or
23 participating instrumentality that has any sheriff's law
24 enforcement employees shall be divided into 2 reserves. A
25 reserve for the sheriff's law enforcement employees shall be
26 allocated an amount in the same proportion to the total amount
27 in reserve as the total number of sheriff's law enforcement
28 employees is to the total participating employees of the
29 municipality or participating instrumentality at that date.
30 The remainder shall be allocated to the reserve for other
31 employees.
32     (d) The Fund shall determine what amounts shall be
33 transferred or credited to the reserve for elected county
34 officers participating in the alternative retirement program.
35 (Source: P.A. 87-740.)
 

 

 

HB4973 - 36 - LRB094 15880 AMC 51102 b

1     (40 ILCS 5/7-205)  (from Ch. 108 1/2, par. 7-205)
2     Sec. 7-205. Reserves for annuities. Appropriate reserves
3 shall be created for payment of all annuities granted under
4 this Article at the time such annuities are granted and in
5 amounts determined to be necessary under actuarial tables
6 adopted by the Board upon recommendation of the actuary of the
7 fund. All annuities payable shall be charged to the annuity
8 reserve.
9     1. Amounts credited to annuity reserves shall be derived by
10 transfer of all the employee credits from the appropriate
11 employee reserves and by charges to the municipality reserve of
12 those municipalities in which the retiring employee has
13 accumulated service. If a retiring employee has accumulated
14 service in more than one participating municipality or
15 participating instrumentality, (i) in the case of concurrent
16 service, aggregate municipality charges shall be prorated on a
17 basis of the employee's earnings in case of concurrent service
18 and (ii) in the case of nonconcurrent service, aggregate
19 municipality charges shall be prorated among all nonfinal
20 employers on a basis of service credit and projected earnings
21 with those employers and, for the final employer, municipality
22 charges shall be paid on a basis of the remaining cost of the
23 employee's pension, as determined by the Board. creditable
24 service in other cases.
25     2. Supplemental annuities shall be handled as a separate
26 annuity and amounts to be credited to the annuity reserve
27 therefor shall be derived in the same manner as a regular
28 annuity.
29     3. When a retirement annuity is granted to an employee with
30 a spouse eligible for a surviving spouse annuity, there shall
31 be credited to the annuity reserve an amount to fund the cost
32 of both the retirement and surviving spouse annuity as a joint
33 and survivors annuity.
34     4. Beginning January 1, 1989, when a retirement annuity is
35 awarded, an amount equal to the present value of the $3,000
36 death benefit payable upon the death of the annuitant shall be

 

 

HB4973 - 37 - LRB094 15880 AMC 51102 b

1 transferred to the annuity reserve from the appropriate
2 municipality reserves in the same manner as the transfer for
3 annuities.
4     5. All annuity reserves shall be revalued annually as of
5 December 31. Beginning as of December 31, 1973, adjustment
6 required therein by such revaluation shall be charged or
7 credited to the earnings and experience variation reserve.
8     6. There shall be credited to the annuity reserve all of
9 the payments made by annuitants under Section 7-144.2, plus an
10 additional amount from the earnings and experience variation
11 reserve to fund the cost of the incremental annuities granted
12 to annuitants making these payments.
13     7. As of December 31, 1972, the excess in the annuity
14 reserve shall be transferred to the municipality reserves. An
15 amount equal to the deficiency in the reserve of participating
16 municipalities and participating instrumentalities which have
17 no participating employees shall be allocated to their
18 reserves. The remainder shall be allocated in amounts
19 proportionate to the present value, as of January 1, 1972, of
20 annuities of annuitants of the remaining participating
21 municipalities and participating instrumentalities.
22 (Source: P.A. 89-136, eff. 7-14-95.)
 
23     (40 ILCS 5/7-211)  (from Ch. 108 1/2, par. 7-211)
24     Sec. 7-211. Authorizations.
25     (a) Each participating municipality and instrumentality
26 thereof and each participating instrumentality shall:
27         1. Deduct all normal and additional contributions and
28     contributions for federal Social Security taxes as
29     required by the Social Security Enabling Act from each
30     payment of earnings payable to each participating employee
31     who is entitled to any earnings from such municipality or
32     instrumentality thereof or participating instrumentality,
33     and remit all such normal and additional contributions
34     immediately to the board and all such contributions for
35     federal Social Security taxes in the manner provided by

 

 

HB4973 - 38 - LRB094 15880 AMC 51102 b

1     law; and
2         2. Pay to the board contributions required by this
3     Article.
4     (b) Each participating employee shall, by virtue of the
5 payment of contributions to this fund, receive a vested
6 interest in the annuities and benefits provided in this Article
7 and in consideration of such vested interest shall be deemed to
8 have agreed and authorized the deduction from earnings of all
9 contributions payable to this fund in accordance with this
10 Article.
11     (c) Payment of earnings less the amounts of contributions
12 provided in this Article and in the Social Security Enabling
13 Act shall be a full and complete discharge of all claims for
14 payment for services rendered by any employee during the period
15 covered by any such payment.
16     (d) Any covered annuitant may authorize the withholding of
17 all or a portion of his or her annuity, for the payment of
18 premiums on group accident and health insurance provided
19 pursuant to Section 7-199.1. The annuitant may revoke this
20 authorization at any time.
21 (Source: P.A. 91-887, eff. 7-6-00.)
 
22     Section 90. The State Mandates Act is amended by adding
23 Section 8.30 as follows:
 
24     (30 ILCS 805/8.30 new)
25     Sec. 8.30. Exempt mandate. Notwithstanding Sections 6 and 8
26 of this Act, no reimbursement by the State is required for the
27 implementation of any mandate created by this amendatory Act of
28 the 94th General Assembly.
 
29     Section 95. No acceleration or delay. Where this Act makes
30 changes in a statute that is represented in this Act by text
31 that is not yet or no longer in effect (for example, a Section
32 represented by multiple versions), the use of that text does
33 not accelerate or delay the taking effect of (i) the changes

 

 

HB4973 - 39 - LRB094 15880 AMC 51102 b

1 made by this Act or (ii) provisions derived from any other
2 Public Act.
 
3     Section 99. Effective date. This Act takes effect upon
4 becoming law.