Full Text of SB2358 96th General Assembly
SB2358 96TH GENERAL ASSEMBLY
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96TH GENERAL ASSEMBLY
State of Illinois
2009 and 2010 SB2358
Introduced 2/27/2009, by Sen. Kirk W. Dillard SYNOPSIS AS INTRODUCED: |
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40 ILCS 5/3-110 |
from Ch. 108 1/2, par. 3-110 |
30 ILCS 805/8.33 new |
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Amends the Downstate Police Article of the Pension Code to allow purchase of
service credit for up to 2 years of military service not immediately preceded
by employment. Allows purchase at a reduced interest rate for 6 months.
Amends the State Mandates Act to require
implementation without reimbursement.
Effective immediately.
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FISCAL NOTE ACT MAY APPLY |
PENSION IMPACT NOTE ACT MAY APPLY |
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT |
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A BILL FOR
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SB2358 |
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LRB096 10723 AMC 20907 b |
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| AN ACT in relation to public employee benefits.
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| Be it enacted by the People of the State of Illinois, | 3 |
| represented in the General Assembly:
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| Section 5. The Illinois Pension Code is amended by changing | 5 |
| Section 3-110
as follows:
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| (40 ILCS 5/3-110) (from Ch. 108 1/2, par. 3-110)
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| Sec. 3-110. Creditable service.
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| (a) "Creditable service" is the time served by a police | 9 |
| officer as a member
of a regularly constituted police force of | 10 |
| a municipality. In computing
creditable service furloughs | 11 |
| without pay exceeding 30 days shall not be
counted, but all | 12 |
| leaves of absence for illness or accident, regardless of
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| length, and all periods of disability retirement for which a | 14 |
| police officer has
received no disability pension payments | 15 |
| under this Article shall be counted.
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| (a-5) Up to 3 years of time during which the police officer | 17 |
| receives
a disability pension under Section 3-114.1, 3-114.2, | 18 |
| 3-114.3, or 3-114.6
shall be counted as creditable service, | 19 |
| provided that
(i) the police officer returns to active service | 20 |
| after the disability for a
period at least equal to the period | 21 |
| for which credit is to be established and
(ii) the police | 22 |
| officer makes contributions to the fund based on the rates
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| specified in Section 3-125.1 and the salary upon which the |
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LRB096 10723 AMC 20907 b |
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| disability pension
is based. These contributions may be paid at | 2 |
| any time prior to the
commencement of a retirement pension. The | 3 |
| police officer may, but need not,
elect to have the | 4 |
| contributions deducted from the disability pension or to
pay | 5 |
| them in installments on a schedule approved by the board. If | 6 |
| not
deducted from the disability pension, the contributions | 7 |
| shall include
interest at the rate of 6% per year, compounded | 8 |
| annually, from the date
for which service credit is being | 9 |
| established to the date of payment. If
contributions are paid | 10 |
| under this subsection (a-5) in excess of those
needed to | 11 |
| establish the credit, the excess shall be refunded. This
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| subsection (a-5) applies to persons receiving a disability | 13 |
| pension under
Section 3-114.1, 3-114.2, 3-114.3, or 3-114.6 on | 14 |
| the effective date of this
amendatory Act of the 91st General | 15 |
| Assembly, as well as persons who begin to
receive such a | 16 |
| disability pension after that date.
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| (b) Creditable service includes all periods of service in | 18 |
| the military,
naval or air forces of the United States entered | 19 |
| upon while an active police
officer of a municipality, provided | 20 |
| that upon applying for a permanent pension,
and in accordance | 21 |
| with the rules of the board, the police officer pays into the
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| fund the amount the officer would have contributed if he or she | 23 |
| had been a
regular contributor during such period, to the | 24 |
| extent that the municipality
which the police officer served | 25 |
| has not made such contributions in the
officer's behalf. The | 26 |
| total amount of such creditable service shall not
exceed 5 |
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| years, except that any police officer who on July 1, 1973 had | 2 |
| more
than 5 years of such creditable service shall receive the | 3 |
| total amount thereof.
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| (b-1) In addition to any creditable service established | 5 |
| under subsection
(b), creditable service may be granted for up | 6 |
| to 24 months of service in the
armed forces of the United | 7 |
| States that was not immediately preceded by
employment as a | 8 |
| police officer. In order to receive creditable service for
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| military service under this subsection (b-1), a police officer | 10 |
| must (1) apply
to the Fund in writing and provide evidence of | 11 |
| the military service that is
satisfactory to the Board and (2) | 12 |
| make contributions to the Fund equal to (i)
the employee | 13 |
| contributions that would have been required had the service | 14 |
| been
rendered as a member, plus (ii) an amount determined by | 15 |
| the board to be equal
to the employer's normal cost of the | 16 |
| benefits accrued for that military
service, plus (iii) interest | 17 |
| on items (i) and (ii) from the date of first
membership in the | 18 |
| Fund to the date of payment. If payment is made during
the | 19 |
| 6-month period that begins 3 months after the effective date of | 20 |
| this
amendatory Act of the 96th General Assembly, the required | 21 |
| interest shall be
at the rate of 2.5% per year, compounded | 22 |
| annually; otherwise, the required
interest shall be calculated | 23 |
| at the rate of 6% per year, compounded annually. | 24 |
| (c) Creditable service also includes service rendered by a | 25 |
| police
officer while on leave of absence from a police | 26 |
| department to serve as an
executive of an organization whose |
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| membership consists of members of a
police department, subject | 2 |
| to the following conditions: (i) the police
officer is a | 3 |
| participant of a fund established under this Article with at
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| least 10 years of service as a police officer; (ii) the police | 5 |
| officer
received no credit for such service under any other | 6 |
| retirement system,
pension fund, or annuity and benefit fund | 7 |
| included in this Code; (iii)
pursuant to the rules of the board | 8 |
| the police officer pays to the fund the
amount he or she would | 9 |
| have contributed had the officer been an active
member of the | 10 |
| police department; and (iv) the organization pays a
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| contribution equal to the municipality's normal cost for that
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| period of service.
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| (d)(1) Creditable service also includes periods of | 14 |
| service originally
established in another police pension | 15 |
| fund under this Article or in the Fund
established under | 16 |
| Article 7 of this Code for which (i) the contributions have
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| been transferred under Section 3-110.7 or Section 7-139.9 | 18 |
| and (ii) any
additional contribution required under | 19 |
| paragraph (2) of this subsection has
been paid in full in | 20 |
| accordance with the requirements of this subsection (d).
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| (2) If the board of the pension fund to which | 22 |
| creditable service and
related
contributions are | 23 |
| transferred under Section 3-110.7 or 7-139.9 determines | 24 |
| that
the amount transferred is less than the true cost to | 25 |
| the pension fund of
allowing that creditable service to be | 26 |
| established, then in order to establish
that creditable |
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| service the police officer must pay to the pension fund, | 2 |
| within
the payment period specified in paragraph (3) of | 3 |
| this subsection, an additional
contribution equal to the | 4 |
| difference, as determined by the board in accordance
with | 5 |
| the rules and procedures adopted under paragraph (6) of | 6 |
| this subsection.
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| (3) Except as provided in paragraph (4), the additional
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| contribution must be paid to the board (i) within 5 years | 9 |
| from the date of the
transfer of contributions under | 10 |
| Section 3-110.7 or 7-139.9 and (ii) before the
police | 11 |
| officer terminates service with the fund. The additional | 12 |
| contribution
may be paid in a lump sum or in accordance | 13 |
| with a schedule of installment
payments authorized by the | 14 |
| board.
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| (4) If the police officer dies in service before | 16 |
| payment in full has been
made and before the expiration of | 17 |
| the 5-year payment period, the surviving
spouse of the | 18 |
| officer may elect to pay the unpaid amount on the officer's
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| behalf within 6 months after the date of death, in which | 20 |
| case the creditable
service shall be granted as though the | 21 |
| deceased police officer had paid the
remaining balance on | 22 |
| the day before the date of death.
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| (5) If the additional contribution is not paid in full | 24 |
| within the
required time, the creditable service shall not | 25 |
| be granted and the
police officer (or the officer's | 26 |
| surviving spouse or estate) shall be entitled
to receive a |
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| refund of (i) any partial payment of the additional | 2 |
| contribution
that has been made by the police officer and | 3 |
| (ii) those portions of the amounts
transferred under | 4 |
| subdivision (a)(1) of Section 3-110.7 or subdivisions | 5 |
| (a)(1)
and (a)(3) of Section 7-139.9 that represent | 6 |
| employee contributions paid by the
police officer (but not | 7 |
| the accumulated interest on those contributions) and
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| interest paid by the police officer to the prior pension | 9 |
| fund in order to
reinstate service terminated by acceptance | 10 |
| of a refund.
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| At the time of paying a refund under this item (5), the | 12 |
| pension fund
shall also repay to the pension fund from | 13 |
| which the contributions were
transferred under Section | 14 |
| 3-110.7 or 7-139.9 the amount originally transferred
under | 15 |
| subdivision (a)(2) of that Section, plus interest at the | 16 |
| rate of 6% per
year, compounded annually, from the date of | 17 |
| the original transfer to the date
of repayment. Amounts | 18 |
| repaid to the Article 7 fund under this provision shall
be | 19 |
| credited to the appropriate municipality.
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| Transferred credit that is not granted due to failure | 21 |
| to pay the additional
contribution within the required time | 22 |
| is lost; it may not be transferred to
another pension fund | 23 |
| and may not be reinstated in the pension fund from which
it | 24 |
| was transferred.
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| (6) The Public Employee Pension Fund Division of the | 26 |
| Department of
Insurance
shall establish by rule the manner |
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| of making the calculation required under
paragraph (2) of | 2 |
| this subsection, taking into account the appropriate | 3 |
| actuarial
assumptions; the police officer's service, age, | 4 |
| and salary history; the level
of funding of the pension | 5 |
| fund to which the credits are being transferred; and
any | 6 |
| other factors that the Division determines to be relevant. | 7 |
| The rules may
require that all calculations made under | 8 |
| paragraph (2) be reported to the
Division by the board | 9 |
| performing the calculation, together with documentation
of | 10 |
| the creditable service to be transferred, the amounts of | 11 |
| contributions and
interest to be transferred, the manner in | 12 |
| which the calculation was performed,
the numbers relied | 13 |
| upon in making the calculation, the results of the
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| calculation, and any other information the Division may | 15 |
| deem useful.
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| (e)(1) Creditable service also includes periods of | 17 |
| service originally
established in the Fund
established | 18 |
| under Article 7 of this Code for which the contributions | 19 |
| have
been transferred under Section 7-139.11.
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| (2) If the board of the pension fund to which | 21 |
| creditable service and
related
contributions are | 22 |
| transferred under Section 7-139.11 determines that
the | 23 |
| amount transferred is less than the true cost to the | 24 |
| pension fund of
allowing that creditable service to be | 25 |
| established, then the amount of creditable service the | 26 |
| police officer may establish under this subsection (e) |
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| shall be reduced by an amount equal to the difference, as | 2 |
| determined by the board in accordance
with the rules and | 3 |
| procedures adopted under paragraph (3) of this subsection.
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| (3) The Public Pension Division of the Department of
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| Financial and Professional Regulation
shall establish by | 6 |
| rule the manner of making the calculation required under
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| paragraph (2) of this subsection, taking into account the | 8 |
| appropriate actuarial
assumptions; the police officer's | 9 |
| service, age, and salary history; the level
of funding of | 10 |
| the pension fund to which the credits are being | 11 |
| transferred; and
any other factors that the Division | 12 |
| determines to be relevant. The rules may
require that all | 13 |
| calculations made under paragraph (2) be reported to the
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| Division by the board performing the calculation, together | 15 |
| with documentation
of the creditable service to be | 16 |
| transferred, the amounts of contributions and
interest to | 17 |
| be transferred, the manner in which the calculation was | 18 |
| performed,
the numbers relied upon in making the | 19 |
| calculation, the results of the
calculation, and any other | 20 |
| information the Division may deem useful.
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| (4) Until January 1, 2010, a police officer who | 22 |
| transferred service from the Fund established under | 23 |
| Article 7 of this Code under the provisions of Public Act | 24 |
| 94-356 may establish additional credit, but only for the | 25 |
| amount of the service credit reduction in that transfer, as | 26 |
| calculated under paragraph (3) of this subsection (e). This |
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| credit may be established upon payment by the police | 2 |
| officer of an amount to be determined by the board, equal | 3 |
| to (1) the amount that would have been contributed as | 4 |
| employee and employer contributions had all of the service | 5 |
| been as an employee under this Article, plus interest | 6 |
| thereon at the rate of 6% per year, compounded annually | 7 |
| from the date of service to the date of transfer, less (2) | 8 |
| the total amount transferred from the Article 7 Fund, plus | 9 |
| (3) interest on the difference at the rate of 6% per year, | 10 |
| compounded annually, from the date of the transfer to the | 11 |
| date of payment. The additional service credit is allowed | 12 |
| under this amendatory Act of the 95th General Assembly | 13 |
| notwithstanding the provisions of Article 7 terminating | 14 |
| all transferred credits on the date of transfer. | 15 |
| (Source: P.A. 94-356, eff. 7-29-05; 95-812, eff. 8-13-08.)
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| Section 90. The State Mandates Act is amended by adding | 17 |
| Section 8.33 as follows: | 18 |
| (30 ILCS 805/8.33 new) | 19 |
| Sec. 8.33. Exempt mandate. Notwithstanding Sections 6 and 8 | 20 |
| of this Act, no reimbursement by the State is required for the | 21 |
| implementation of any mandate created by this amendatory Act of | 22 |
| the 96th General Assembly. | 23 |
| Section 99. Effective date. This Act takes effect upon | 24 |
| becoming law. |
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