Full Text of SB0701 100th General Assembly
SB0701ham001 100TH GENERAL ASSEMBLY | Rep. Elaine Nekritz Filed: 5/22/2017
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| 1 | | AMENDMENT TO SENATE BILL 701
| 2 | | AMENDMENT NO. ______. Amend Senate Bill 701 by replacing | 3 | | everything after the enacting clause with the following:
| 4 | | "Section 5. The Illinois Pension Code is amended by | 5 | | changing Sections 7-114 and 7-172 as follows:
| 6 | | (40 ILCS 5/7-114) (from Ch. 108 1/2, par. 7-114)
| 7 | | (Text of Section WITHOUT the changes made by P.A. 98-599, | 8 | | which has been
held unconstitutional)
| 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 |
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| 1 | | participating instrumentality, including compensation, | 2 | | fees,
allowances (but not including amounts associated | 3 | | with a vehicle allowance payable to an employee who first | 4 | | becomes a participating employee on or after the effective | 5 | | date of this amendatory Act of the 100th General Assembly) , | 6 | | or other emolument paid for official duties (but not
| 7 | | including automobile maintenance, travel expense, or | 8 | | reimbursements for
expenditures incurred in the | 9 | | performance of duties) and, for fee
offices, the fees or | 10 | | earnings of the offices to the extent such fees are
paid | 11 | | out of funds controlled by the municipality, or | 12 | | instrumentality or
participating instrumentality; and
| 13 | | 2. The money value, as determined by rules prescribed | 14 | | by the
governing body of the municipality, or | 15 | | instrumentality thereof, of any
board, lodging, fuel, | 16 | | laundry, and other allowances provided an employee
in lieu | 17 | | of money.
| 18 | | (b) For purposes of determining benefits payable under this | 19 | | fund
payments to a person who is engaged in an independently | 20 | | established
trade, occupation, profession or business and who | 21 | | is paid for his
service on a basis other than a monthly or | 22 | | other regular salary, are not
earnings.
| 23 | | (c) If a disabled participating employee is eligible to | 24 | | receive Workers'
Compensation for an accidental injury and the | 25 | | participating municipality or
instrumentality which employed | 26 | | the participating employee when injured
continues to pay the |
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| 1 | | participating employee regular salary or other
compensation or | 2 | | pays the employee an amount in excess of the Workers'
| 3 | | Compensation amount, then earnings shall be deemed to be the | 4 | | total payments,
including an amount equal to the Workers' | 5 | | Compensation payments. These
payments shall be subject to | 6 | | employee contributions and allocated as if paid to
the | 7 | | participating employee when the regular payroll amounts would | 8 | | have been
paid if the participating employee had continued | 9 | | working, and creditable
service shall be awarded for this | 10 | | period.
| 11 | | (d) If an elected official who is a participating employee | 12 | | becomes disabled
but does not resign and is not removed from | 13 | | office, then earnings shall include
all salary payments made | 14 | | for the remainder of that term of office and the
official shall | 15 | | be awarded creditable service for the term of office.
| 16 | | (e) If a participating employee is paid pursuant to "An Act | 17 | | to provide for
the continuation of compensation for law | 18 | | enforcement officers, correctional
officers and firemen who | 19 | | suffer disabling injury in the line of duty", approved
| 20 | | September 6, 1973, as amended, the payments shall be deemed | 21 | | earnings, and the
participating employee shall be awarded | 22 | | creditable service for this period.
| 23 | | (f) Additional compensation received by a person while | 24 | | serving as a
supervisor of assessments, assessor, deputy | 25 | | assessor or member of a board of
review from the State of | 26 | | Illinois pursuant to Section 4-10 or 4-15 of the
Property Tax |
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| 1 | | Code shall not be
earnings for purposes of this Article and | 2 | | shall not be included in the
contribution formula or | 3 | | calculation of benefits for such person pursuant to
this | 4 | | Article.
| 5 | | (Source: P.A. 87-740; 88-670, eff. 12-2-94.)
| 6 | | (40 ILCS 5/7-172) (from Ch. 108 1/2, par. 7-172)
| 7 | | Sec. 7-172. Contributions by participating municipalities | 8 | | and
participating instrumentalities.
| 9 | | (a) Each participating municipality and each participating
| 10 | | instrumentality shall make payment to the fund as follows:
| 11 | | 1. municipality contributions in an amount determined | 12 | | by applying
the municipality contribution rate to each | 13 | | payment of earnings paid to
each of its participating | 14 | | employees;
| 15 | | 2. an amount equal to the employee contributions | 16 | | provided by paragraph
(a) of Section 7-173, whether or not | 17 | | the employee contributions are
withheld as permitted by | 18 | | that Section;
| 19 | | 3. all accounts receivable, together with interest | 20 | | charged thereon,
as provided in Section 7-209, and any | 21 | | amounts due under subsection (a-5) of Section 7-144;
| 22 | | 4. if it has no participating employees with current | 23 | | earnings, an
amount payable which, over a closed period of | 24 | | 20 years for participating municipalities and 10 years for | 25 | | participating instrumentalities, will amortize, at the |
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| 1 | | effective rate for
that year, any unfunded obligation. The | 2 | | unfunded obligation shall be computed as provided in | 3 | | paragraph 2 of subsection (b); | 4 | | 5. if it has fewer than 7 participating employees or a | 5 | | negative balance in its municipality reserve, the greater | 6 | | of (A) an amount payable that, over a period of 20 years, | 7 | | will amortize at the effective rate for that year any | 8 | | unfunded obligation, computed as provided in paragraph 2 of | 9 | | subsection (b) or (B) the amount required by paragraph 1 of | 10 | | this subsection (a).
| 11 | | (b) A separate municipality contribution rate shall be | 12 | | determined
for each calendar year for all participating | 13 | | municipalities together
with all instrumentalities thereof. | 14 | | The municipality contribution rate
shall be determined for | 15 | | participating instrumentalities as if they were
participating | 16 | | municipalities. The municipality contribution rate shall
be | 17 | | the sum of the following percentages:
| 18 | | 1. The percentage of earnings of all the participating | 19 | | employees of all
participating municipalities and | 20 | | participating instrumentalities which, if paid
over the | 21 | | entire period of their service, will be sufficient when | 22 | | combined with
all employee contributions available for the | 23 | | payment of benefits, to provide
all annuities for | 24 | | participating employees, and the $3,000 death benefit
| 25 | | payable under Sections 7-158 and 7-164, such percentage to | 26 | | be known as the
normal cost rate.
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| 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 a | 12 | | period determined by the Board, not to exceed 30 years for | 13 | | participating municipalities or 10 years for participating | 14 | | instrumentalities.
| 15 | | 3. The percentage of earnings of the participating | 16 | | employees of all
municipalities and participating | 17 | | instrumentalities necessary to provide
the present value | 18 | | of all temporary and total and permanent disability
| 19 | | benefits granted during the most recent year for which | 20 | | information is
available.
| 21 | | 4. The percentage of earnings of the participating | 22 | | employees of all
participating municipalities and | 23 | | participating instrumentalities
necessary to provide the | 24 | | present value of the net single sum death
benefits expected | 25 | | to become payable from the reserve established under
| 26 | | Section 7-206 during the year for which this rate is fixed.
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| 1 | | 5. The percentage of earnings necessary to meet any | 2 | | deficiency
arising in the Terminated Municipality Reserve.
| 3 | | (c) A separate municipality contribution rate shall be | 4 | | computed for
each participating municipality or participating | 5 | | instrumentality
for its sheriff's law enforcement employees.
| 6 | | A separate municipality contribution rate shall be | 7 | | computed for the
sheriff's law enforcement employees of each | 8 | | forest preserve district that
elects to have such employees. | 9 | | For the period from January 1, 1986 to
December 31, 1986, such | 10 | | rate shall be the forest preserve district's regular
rate plus | 11 | | 2%.
| 12 | | In the event that the Board determines that there is an | 13 | | actuarial
deficiency in the account of any municipality with | 14 | | respect to a person who
has elected to participate in the Fund | 15 | | under Section 3-109.1 of this Code,
the Board may adjust the | 16 | | municipality's contribution rate so as to make up
that | 17 | | deficiency over such reasonable period of time as the Board may | 18 | | determine.
| 19 | | (d) The Board may establish a separate municipality | 20 | | contribution
rate for all employees who are program | 21 | | participants employed under the
federal Comprehensive | 22 | | Employment Training Act by all of the
participating | 23 | | municipalities and instrumentalities. The Board may also
| 24 | | provide that, in lieu of a separate municipality rate for these
| 25 | | employees, a portion of the municipality contributions for such | 26 | | program
participants shall be refunded or an extra charge |
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| 1 | | assessed so that the
amount of municipality contributions | 2 | | retained or received by the fund
for all CETA program | 3 | | participants shall be an amount equal to that which
would be | 4 | | provided by the separate municipality contribution rate for all
| 5 | | such program participants. Refunds shall be made to prime | 6 | | sponsors of
programs upon submission of a claim therefor and | 7 | | extra charges shall be
assessed to participating | 8 | | municipalities and instrumentalities. In
establishing the | 9 | | municipality contribution rate as provided in paragraph
(b) of | 10 | | this Section, the use of a separate municipality contribution
| 11 | | rate for program participants or the refund of a portion of the
| 12 | | municipality contributions, as the case may be, may be | 13 | | considered.
| 14 | | (e) Computations of municipality contribution rates for | 15 | | the
following calendar year shall be made prior to the | 16 | | beginning of each
year, from the information available at the | 17 | | time the computations are
made, and on the assumption that the | 18 | | employees in each participating
municipality or participating | 19 | | instrumentality at such time will continue
in service until the | 20 | | end of such calendar year at their respective rates
of earnings | 21 | | at such time.
| 22 | | (f) Any municipality which is the recipient of State | 23 | | allocations
representing that municipality's contributions for | 24 | | retirement annuity
purposes on behalf of its employees as | 25 | | provided in Section 12-21.16 of
the Illinois Public Aid Code | 26 | | shall pay the allocations so
received to the Board for such |
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| 1 | | purpose. Estimates of State allocations to
be received during | 2 | | any taxable year shall be considered in the
determination of | 3 | | the municipality's tax rate for that year under Section
7-171. | 4 | | If a special tax is levied under Section 7-171, none of the
| 5 | | proceeds may be used to reimburse the municipality for the | 6 | | amount of State
allocations received and paid to the Board. Any | 7 | | multiple-county or
consolidated health department which | 8 | | receives contributions from a county
under Section 11.2 of "An | 9 | | Act in relation to establishment and maintenance
of county and | 10 | | multiple-county health departments", approved July 9, 1943,
as | 11 | | amended, or distributions under Section 3 of the Department of | 12 | | Public
Health Act, shall use these only for municipality | 13 | | contributions by the
health department.
| 14 | | (g) Municipality contributions for the several purposes | 15 | | specified
shall, for township treasurers and employees in the | 16 | | offices of the
township treasurers who meet the qualifying | 17 | | conditions for coverage
hereunder, be allocated among the | 18 | | several school districts and parts of
school districts serviced | 19 | | by such treasurers and employees in the
proportion which the | 20 | | amount of school funds of each district or part of
a district | 21 | | handled by the treasurer bears to the total amount of all
| 22 | | school funds handled by the treasurer.
| 23 | | From the funds subject to allocation among districts and | 24 | | parts of
districts pursuant to the School Code, the trustees | 25 | | shall withhold the
proportionate share of the liability for | 26 | | municipality contributions imposed
upon such districts by this |
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| 1 | | Section, in respect to such township treasurers
and employees | 2 | | and remit the same to the Board.
| 3 | | The municipality contribution rate for an educational | 4 | | service center shall
initially be the same rate for each year | 5 | | as the regional office of
education or school district
which | 6 | | serves as its administrative agent. When actuarial data become
| 7 | | available, a separate rate shall be established as provided in | 8 | | subparagraph
(i) of this Section.
| 9 | | The municipality contribution rate for a public agency, | 10 | | other than a
vocational education cooperative, formed under the | 11 | | Intergovernmental
Cooperation Act shall initially be the | 12 | | average rate for the municipalities
which are parties to the | 13 | | intergovernmental agreement. When actuarial data
become | 14 | | available, a separate rate shall be established as provided in
| 15 | | subparagraph (i) of this Section.
| 16 | | (h) Each participating municipality and participating
| 17 | | instrumentality shall make the contributions in the amounts | 18 | | provided in
this Section in the manner prescribed from time to | 19 | | time by the Board and
all such contributions shall be | 20 | | obligations of the respective
participating municipalities and | 21 | | participating instrumentalities to this
fund. The failure to | 22 | | deduct any employee contributions shall not
relieve the | 23 | | participating municipality or participating instrumentality
of | 24 | | its obligation to this fund. Delinquent payments of | 25 | | contributions
due under this Section may, with interest, be | 26 | | recovered by civil action
against the participating |
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| 1 | | municipalities or participating
instrumentalities. | 2 | | Municipality contributions, other than the amount
necessary | 3 | | for employee contributions, for
periods of service by employees | 4 | | from whose earnings no deductions were made
for employee | 5 | | contributions to the fund, may be charged to the municipality
| 6 | | reserve for the municipality or participating instrumentality.
| 7 | | (i) Contributions by participating instrumentalities shall | 8 | | be
determined as provided herein except that the percentage | 9 | | derived under
subparagraph 2 of paragraph (b) of this Section, | 10 | | and the amount payable
under subparagraph 4 of paragraph (a) of | 11 | | this Section, shall be based on
an amortization period of 10 | 12 | | years.
| 13 | | (j) Notwithstanding the other provisions of this Section, | 14 | | the additional unfunded liability accruing as a result of this | 15 | | amendatory Act of the 94th General Assembly
shall be amortized | 16 | | over a period of 30 years beginning on January 1 of the
second | 17 | | calendar year following the calendar year in which this | 18 | | amendatory Act takes effect, except that the employer may | 19 | | provide for a longer amortization period by adopting a | 20 | | resolution or ordinance specifying a 35-year or 40-year period | 21 | | and submitting a certified copy of the ordinance or resolution | 22 | | to the fund no later than June 1 of the calendar year following | 23 | | the calendar year in which this amendatory Act takes effect.
| 24 | | (k) If the amount of a participating employee's reported | 25 | | earnings for any of the 12-month periods used to determine the | 26 | | final rate of earnings exceeds the employee's 12 month reported |
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| 1 | | earnings with the same employer for the previous year by the | 2 | | greater of 6% or 1.5 times the annual increase in the Consumer | 3 | | Price Index-U, as established by the United States Department | 4 | | of Labor for the preceding September, the participating | 5 | | municipality or participating instrumentality that paid those | 6 | | earnings shall pay to the Fund, in addition to any other | 7 | | contributions required under this Article, the present value of | 8 | | the increase in the pension resulting from the portion of the | 9 | | increase in salary that is in excess of the greater of 6% or | 10 | | 1.5 times the annual increase in the Consumer Price Index-U, as | 11 | | determined by the Fund. This present value shall be computed on | 12 | | the basis of the actuarial assumptions and tables used in the | 13 | | most recent actuarial valuation of the Fund that is available | 14 | | at the time of the computation. | 15 | | Whenever it determines that a payment is or may be required | 16 | | under this subsection (k), the fund shall calculate the amount | 17 | | of the payment and bill the participating municipality or | 18 | | participating instrumentality for that amount. The bill shall | 19 | | specify the calculations used to determine the amount due. If | 20 | | the participating municipality or participating | 21 | | instrumentality disputes the amount of the bill, it may, within | 22 | | 30 days after receipt of the bill, apply to the fund in writing | 23 | | for a recalculation. The application must specify in detail the | 24 | | grounds of the dispute. Upon receiving a timely application for | 25 | | recalculation, the fund shall review the application and, if | 26 | | appropriate, recalculate the amount due.
The participating |
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| 1 | | municipality and participating instrumentality contributions | 2 | | required under this subsection (k) may be paid in the form of a | 3 | | lump sum within 90 days after receipt of the bill. If the | 4 | | participating municipality and participating instrumentality | 5 | | contributions are not paid within 90 days after receipt of the | 6 | | bill, then interest will be charged at a rate equal to the | 7 | | fund's annual actuarially assumed rate of return on investment | 8 | | compounded annually from the 91st day after receipt of the | 9 | | bill. Payments must be concluded within 3 years after receipt | 10 | | of the bill by the participating municipality or participating | 11 | | instrumentality. | 12 | | When assessing payment for any amount due under this | 13 | | subsection (k), the fund shall exclude earnings increases | 14 | | resulting from overload or overtime earnings. | 15 | | When assessing payment for any amount due under this | 16 | | subsection (k), the fund shall exclude earnings increases | 17 | | resulting from payments for unused vacation time, but only for | 18 | | payments for unused vacation time made in the final 3 months of | 19 | | the final rate of earnings period. | 20 | | When assessing payment for any amount due under this | 21 | | subsection (k), the fund shall also exclude earnings increases | 22 | | attributable to standard employment promotions resulting in | 23 | | increased responsibility and workload. | 24 | | This subsection (k) does not apply to earnings increases | 25 | | paid to individuals under contracts or collective bargaining | 26 | | agreements entered into, amended, or renewed before January 1, |
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| 1 | | 2012 (the effective date of Public Act 97-609), earnings | 2 | | increases paid to members who are 10 years or more from | 3 | | retirement eligibility, or earnings increases resulting from | 4 | | an increase in the number of hours required to be worked. | 5 | | When assessing payment for any amount due under this | 6 | | subsection (k), the fund shall also exclude earnings | 7 | | attributable to personnel policies adopted before January 1, | 8 | | 2012 (the effective date of Public Act 97-609) as long as those | 9 | | policies are not applicable to employees who begin service on | 10 | | or after January 1, 2012 (the effective date of Public Act | 11 | | 97-609). | 12 | | (Source: P.A. 98-218, eff. 8-9-13; 99-745, eff. 8-5-16.)
| 13 | | Section 99. Effective date. This Act takes effect upon | 14 | | becoming law.".
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