Full Text of SB2622 093rd General Assembly
SB2622 93RD GENERAL ASSEMBLY
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93RD GENERAL ASSEMBLY
State of Illinois
2003 and 2004 SB2622
Introduced 2/4/2004, by Denny Jacobs SYNOPSIS AS INTRODUCED: |
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40 ILCS 5/15-136 |
from Ch. 108 1/2, par. 15-136 |
40 ILCS 5/15-157 |
from Ch. 108 1/2, par. 15-157 |
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Amends the State Universities Article of the Illinois Pension Code.
Increases the retirement formula for a participant who has 20 or more years
of service as a police officer or firefighter. Also increases the employee
contributions for participants who are police officers or firefighters by a
total of 3% of earnings, in 3 annual increments. Effective immediately.
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FISCAL NOTE ACT MAY APPLY | |
PENSION IMPACT NOTE ACT MAY APPLY |
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A BILL FOR
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SB2622 |
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LRB093 19389 LRD 45127 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 |
| Sections 15-136
and 15-157 as follows:
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| (40 ILCS 5/15-136) (from Ch. 108 1/2, par. 15-136)
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| Sec. 15-136. Retirement annuities - Amount. The provisions | 8 |
| of this
Section 15-136 apply only to those participants who are | 9 |
| participating in the
traditional benefit package or the | 10 |
| portable benefit package and do not
apply to participants who | 11 |
| are participating in the self-managed plan.
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| (a) The amount of a participant's retirement annuity, | 13 |
| expressed in the form
of a single-life annuity, shall be | 14 |
| determined by whichever of the following
rules is applicable | 15 |
| and provides the largest annuity:
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| Rule 1: The retirement annuity shall be 1.67% of final rate | 17 |
| of earnings for
each of the first 10 years of service, 1.90% | 18 |
| for each of the next 10 years of
service, 2.10% for each year | 19 |
| of service in excess of 20 but not exceeding 30,
and 2.30% for | 20 |
| each year in excess of 30; or for persons who retire on or
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| after January 1, 1998, 2.2% of the final rate of earnings for | 22 |
| each year of
service.
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| Rule 2: The retirement annuity shall be the sum of the | 24 |
| following,
determined from amounts credited to the participant | 25 |
| in accordance with the
actuarial tables and the prescribed rate | 26 |
| of interest in effect at the
time the retirement annuity | 27 |
| begins:
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| (i) the normal annuity which can be provided on an | 29 |
| actuarially
equivalent basis, by the accumulated normal | 30 |
| contributions as of
the date the annuity begins;
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| (ii) an annuity from employer contributions of an | 32 |
| amount equal to that
which can be provided on an |
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| actuarially equivalent basis from the accumulated
normal | 2 |
| contributions made by the participant under Section | 3 |
| 15-113.6 and Section
15-113.7 plus 1.4 times all other | 4 |
| accumulated normal contributions made by
the participant; | 5 |
| and
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| (iii) the annuity that can be provided on an | 7 |
| actuarially equivalent basis
from the entire contribution | 8 |
| made by the participant under Section 15-113.3.
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| With respect to a police officer or firefighter who retires | 10 |
| on or after
August 14, 1998, the accumulated normal | 11 |
| contributions taken into account under
clauses (i) and (ii) of | 12 |
| this Rule 2 shall include the additional normal
contributions | 13 |
| made by the police officer or firefighter under Section
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| 15-157(a).
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| The amount of a retirement annuity calculated under this | 16 |
| Rule 2 shall
be computed solely on the basis of the | 17 |
| participant's accumulated normal
contributions, as specified | 18 |
| in this Rule and defined in Section 15-116.
Neither an employee | 19 |
| or employer contribution for early retirement under
Section | 20 |
| 15-136.2 nor any other employer contribution shall be used in | 21 |
| the
calculation of the amount of a retirement annuity under | 22 |
| this Rule 2.
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| This amendatory Act of the 91st General Assembly is a | 24 |
| clarification of
existing law and applies to every participant | 25 |
| and annuitant without regard to
whether status as an employee | 26 |
| terminates before the effective date of this
amendatory Act.
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| Rule 3: The retirement annuity of a participant who is | 28 |
| employed
at least one-half time during the period on which his | 29 |
| or her final rate of
earnings is based, shall be equal to the | 30 |
| participant's years of service
not to exceed 30, multiplied by | 31 |
| (1) $96 if the participant's final rate
of earnings is less | 32 |
| than $3,500, (2) $108 if the final rate of earnings is
at least | 33 |
| $3,500 but less than $4,500, (3) $120 if the final rate of | 34 |
| earnings
is at least $4,500 but less than $5,500, (4) $132 if | 35 |
| the final rate
of earnings is at least $5,500 but less than | 36 |
| $6,500, (5)
$144 if the final rate of earnings is at least |
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| $6,500 but less than
$7,500, (6) $156 if the final rate of | 2 |
| earnings is at least $7,500 but less
than $8,500, (7) $168 if | 3 |
| the final rate of earnings is at least $8,500 but
less than | 4 |
| $9,500, and (8) $180 if the final rate of earnings is $9,500 or
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| more, except that the annuity for those persons having made an | 6 |
| election under
Section 15-154(a-1) shall be calculated and | 7 |
| payable under the portable
retirement benefit program pursuant | 8 |
| to the provisions of Section 15-136.4.
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| Rule 4: A participant who is at least age 50 and has 25 or | 10 |
| more years of
service as a police officer or firefighter, and a | 11 |
| participant who is age 55 or
over and has at least 20 but less | 12 |
| than 25 years of service as a police officer
or firefighter, | 13 |
| shall be entitled to a retirement annuity of 3%
2 1/4% of the
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| final rate of earnings for each of the first 10 years of | 15 |
| service as a police
officer or firefighter, 2 1/2% for each of | 16 |
| the next 10 years of service as a
police officer or | 17 |
| firefighter, and 2 3/4% for each year of service as a police
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| officer or firefighter in excess of 20 . The retirement annuity | 19 |
| for all other
service shall be computed under Rule 1.
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| For purposes of this Rule 4, a participant's service as a | 21 |
| firefighter
shall also include the following:
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| (i) service that is performed while the person is an | 23 |
| employee under
subsection (h) of Section 15-107; and
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| (ii) in the case of an individual who was a | 25 |
| participating employee
employed in the fire department of | 26 |
| the University of Illinois's
Champaign-Urbana campus | 27 |
| immediately prior to the elimination of that fire
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| department and who immediately after the elimination of | 29 |
| that fire department
transferred to another job with the | 30 |
| University of Illinois, service performed
as an employee of | 31 |
| the University of Illinois in a position other than police
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| officer or firefighter, from the date of that transfer | 33 |
| until the employee's
next termination of service with the | 34 |
| University of Illinois.
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| Rule 5: The retirement annuity of a participant who elected | 36 |
| early
retirement under the provisions of Section 15-136.2 and |
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| who, on or before
February 16, 1995, brought administrative | 2 |
| proceedings pursuant to the
administrative rules adopted by the | 3 |
| System to challenge the calculation of his
or her retirement | 4 |
| annuity shall be the sum of the following, determined from
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| amounts credited to the participant in accordance with the | 6 |
| actuarial tables and
the prescribed rate of interest in effect | 7 |
| at the time the retirement annuity
begins:
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| (i) the normal annuity which can be provided on an | 9 |
| actuarially equivalent
basis, by the accumulated normal | 10 |
| contributions as of the date the annuity
begins; and
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| (ii) an annuity from employer contributions of an | 12 |
| amount equal to that
which can be provided on an | 13 |
| actuarially equivalent basis from the accumulated
normal | 14 |
| contributions made by the participant under Section | 15 |
| 15-113.6 and Section
15-113.7 plus 1.4 times all other | 16 |
| accumulated normal contributions made by the
participant; | 17 |
| and
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| (iii) an annuity which can be provided on an | 19 |
| actuarially equivalent basis
from the employee | 20 |
| contribution for early retirement under Section 15-136.2, | 21 |
| and
an annuity from employer contributions of an amount | 22 |
| equal to that which can be
provided on an actuarially | 23 |
| equivalent basis from the employee contribution for
early | 24 |
| retirement under Section 15-136.2.
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| In no event shall a retirement annuity under this Rule 5 be | 26 |
| lower than the
amount obtained by adding (1) the monthly amount | 27 |
| obtained by dividing the
combined employee and employer | 28 |
| contributions made under Section 15-136.2 by the
System's | 29 |
| annuity factor for the age of the participant at the beginning | 30 |
| of the
annuity payment period and (2) the amount equal to the | 31 |
| participant's annuity if
calculated under Rule 1, reduced under | 32 |
| Section 15-136(b) as if no
contributions had been made under | 33 |
| Section 15-136.2.
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| With respect to a participant who is qualified for a | 35 |
| retirement annuity under
this Rule 5 whose retirement annuity | 36 |
| began before the effective date of this
amendatory Act of the |
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| 91st General Assembly, and for whom an employee
contribution | 2 |
| was made under Section 15-136.2, the System shall recalculate | 3 |
| the
retirement annuity under this Rule 5 and shall pay any | 4 |
| additional amounts due
in the manner provided in Section | 5 |
| 15-186.1 for benefits mistakenly set too low.
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| The amount of a retirement annuity calculated under this | 7 |
| Rule 5 shall be
computed solely on the basis of those | 8 |
| contributions specifically set forth in
this Rule 5. Except as | 9 |
| provided in clause (iii) of this Rule 5, neither an
employee | 10 |
| nor employer contribution for early retirement under Section | 11 |
| 15-136.2,
nor any other employer contribution, shall be used in | 12 |
| the calculation of the
amount of a retirement annuity under | 13 |
| this Rule 5.
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| The General Assembly has adopted the changes set forth in | 15 |
| Section 25 of this
amendatory Act of the 91st General Assembly | 16 |
| in recognition that the decision of
the Appellate Court for the | 17 |
| Fourth District in Mattis v. State Universities
Retirement | 18 |
| System et al. might be deemed to give some right to the | 19 |
| plaintiff in
that case. The changes made by Section 25 of this | 20 |
| amendatory Act of the 91st
General Assembly are a legislative | 21 |
| implementation of the decision of the
Appellate Court for the | 22 |
| Fourth District in Mattis v. State Universities
Retirement | 23 |
| System et al. with respect to that plaintiff.
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| The changes made by Section 25 of this amendatory Act of | 25 |
| the 91st General
Assembly apply without regard to whether the | 26 |
| person is in service as an
employee on or after its effective | 27 |
| date.
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| (b) The retirement annuity provided under Rules 1 and 3 | 29 |
| above shall be
reduced by 1/2 of 1% for each month the | 30 |
| participant is under age 60 at the
time of retirement. However, | 31 |
| this reduction shall not apply in the following
cases:
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| (1) For a disabled participant whose disability | 33 |
| benefits have been
discontinued because he or she has | 34 |
| exhausted eligibility for disability
benefits under clause | 35 |
| (6) of Section 15-152;
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| (2) For a participant who has at least the number of |
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| years of service
required to retire at any age under | 2 |
| subsection (a) of Section 15-135; or
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| (3) For that portion of a retirement annuity which has | 4 |
| been provided on
account of service of the participant | 5 |
| during periods when he or she performed
the duties of a | 6 |
| police officer or firefighter, if these duties were | 7 |
| performed
for at least 5 years immediately preceding the | 8 |
| date the retirement annuity
is to begin.
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| (c) The maximum retirement annuity provided under Rules 1, | 10 |
| 2, 4,
and 5
shall be the lesser of (1) the annual limit of | 11 |
| benefits as specified in
Section 415 of the Internal Revenue | 12 |
| Code of 1986, as such Section may be
amended from time to time | 13 |
| and as such benefit limits shall be adjusted by
the | 14 |
| Commissioner of Internal Revenue, and (2) 80% of final rate of
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| earnings.
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| (d) An annuitant whose status as an employee terminates | 17 |
| after August 14,
1969 shall receive automatic increases in his | 18 |
| or her retirement annuity as
follows:
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| Effective January 1 immediately following the date the | 20 |
| retirement annuity
begins, the annuitant shall receive an | 21 |
| increase in his or her monthly
retirement annuity of 0.125% of | 22 |
| the monthly retirement annuity provided under
Rule 1, Rule 2, | 23 |
| Rule 3, Rule 4, or Rule 5, contained in this
Section, | 24 |
| multiplied by
the number of full months which elapsed from the | 25 |
| date the retirement annuity
payments began to January 1, 1972, | 26 |
| plus 0.1667% of such annuity, multiplied by
the number of full | 27 |
| months which elapsed from January 1, 1972, or the date the
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| retirement annuity payments began, whichever is later, to | 29 |
| January 1, 1978, plus
0.25% of such annuity multiplied by the | 30 |
| number of full months which elapsed
from January 1, 1978, or | 31 |
| the date the retirement annuity payments began,
whichever is | 32 |
| later, to the effective date of the increase.
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| The annuitant shall receive an increase in his or her | 34 |
| monthly retirement
annuity on each January 1 thereafter during | 35 |
| the annuitant's life of 3% of
the monthly annuity provided | 36 |
| under Rule 1, Rule 2, Rule 3, Rule 4, or
Rule 5 contained
in |
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| this Section. The change made under this subsection by P.A. | 2 |
| 81-970 is
effective January 1, 1980 and applies to each | 3 |
| annuitant whose status as
an employee terminates before or | 4 |
| after that date.
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| Beginning January 1, 1990, all automatic annual increases | 6 |
| payable under
this Section shall be calculated as a percentage | 7 |
| of the total annuity
payable at the time of the increase, | 8 |
| including all increases previously
granted under this Article.
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| The change made in this subsection by P.A. 85-1008 is | 10 |
| effective January
26, 1988, and is applicable without regard to | 11 |
| whether status as an employee
terminated before that date.
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| (e) If, on January 1, 1987, or the date the retirement | 13 |
| annuity payment
period begins, whichever is later, the sum of | 14 |
| the retirement annuity
provided under Rule 1 or Rule 2 of this | 15 |
| Section
and the automatic annual increases provided under the | 16 |
| preceding subsection
or Section 15-136.1, amounts to less than | 17 |
| the retirement
annuity which would be provided by Rule 3, the | 18 |
| retirement
annuity shall be increased as of January 1, 1987, or | 19 |
| the date the
retirement annuity payment period begins, | 20 |
| whichever is later, to the amount
which would be provided by | 21 |
| Rule 3 of this Section. Such increased
amount shall be | 22 |
| considered as the retirement annuity in determining
benefits | 23 |
| provided under other Sections of this Article. This paragraph
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| applies without regard to whether status as an employee | 25 |
| terminated before the
effective date of this amendatory Act of | 26 |
| 1987, provided that the annuitant was
employed at least | 27 |
| one-half time during the period on which the final rate of
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| earnings was based.
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| (f) A participant is entitled to such additional annuity as | 30 |
| may be provided
on an actuarially equivalent basis, by any | 31 |
| accumulated
additional contributions to his or her credit. | 32 |
| However,
the additional contributions made by the participant | 33 |
| toward the automatic
increases in annuity provided under this | 34 |
| Section shall not be taken into
account in determining the | 35 |
| amount of such additional annuity.
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| (g) If, (1) by law, a function of a governmental unit, as |
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| defined by Section
20-107 of this Code, is transferred in whole | 2 |
| or in part to an employer, and (2)
a participant transfers | 3 |
| employment from such governmental unit to such employer
within | 4 |
| 6 months after the transfer of the function, and (3) the sum of | 5 |
| (A) the
annuity payable to the participant under Rule 1, 2, or | 6 |
| 3 of this Section (B)
all proportional annuities payable to the | 7 |
| participant by all other retirement
systems covered by Article | 8 |
| 20, and (C) the initial primary insurance amount to
which the | 9 |
| participant is entitled under the Social Security Act, is less | 10 |
| than
the retirement annuity which would have been payable if | 11 |
| all of the
participant's pension credits validated under | 12 |
| Section 20-109 had been validated
under this system, a | 13 |
| supplemental annuity equal to the difference in such
amounts | 14 |
| shall be payable to the participant.
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| (h) On January 1, 1981, an annuitant who was receiving
a | 16 |
| retirement annuity on or before January 1, 1971 shall have his | 17 |
| or her
retirement annuity then being paid increased $1 per | 18 |
| month for
each year of creditable service. On January 1, 1982, | 19 |
| an annuitant whose
retirement annuity began on or before | 20 |
| January 1, 1977, shall have his or her
retirement annuity then | 21 |
| being paid increased $1 per month for each year of
creditable | 22 |
| service.
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| (i) On January 1, 1987, any annuitant whose retirement | 24 |
| annuity began on or
before January 1, 1977, shall have the | 25 |
| monthly retirement annuity increased by
an amount equal to 8˘ | 26 |
| per year of creditable service times the number of years
that | 27 |
| have elapsed since the annuity began.
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| (Source: P.A. 92-16, eff. 6-28-01; 93-347, eff. 7-24-03.)
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| (40 ILCS 5/15-157) (from Ch. 108 1/2, par. 15-157)
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| Sec. 15-157. Employee Contributions.
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| (a) Each participating employee shall make contributions | 32 |
| towards the
retirement benefits payable under the retirement | 33 |
| program applicable to the
employee from each payment
of | 34 |
| earnings applicable to employment under this system on and | 35 |
| after the
date of becoming a participant as follows: Prior to |
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| September 1, 1949,
3 1/2% of earnings; from September 1, 1949 | 2 |
| to August 31, 1955, 5%; from
September 1, 1955 to August 31, | 3 |
| 1969, 6%; from September 1, 1969, 6 1/2%.
These contributions | 4 |
| are to be considered as normal contributions for purposes
of | 5 |
| this Article.
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| Each participant who is a police officer or firefighter | 7 |
| shall make normal
contributions of 8% through December 31, | 8 |
| 2004, 9% in 2005, 10% in 2006, and
11% in 2007 and thereafter,
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| of each payment of earnings applicable to
employment as a
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| police officer or firefighter under this system on or after | 11 |
| September 1, 1981,
unless he or she files with the board within | 12 |
| 60 days after the effective date
of this amendatory Act of 1991 | 13 |
| or 60 days after the board receives notice that
he or she is | 14 |
| employed as a police officer or firefighter, whichever is | 15 |
| later,
a written notice waiving the retirement formula provided | 16 |
| by Rule 4 of Section
15-136. This waiver shall be irrevocable. | 17 |
| If a participant had met the
conditions set forth in Section | 18 |
| 15-132.1 prior to the effective date of this
amendatory Act of | 19 |
| 1991 but failed to make the additional normal contributions
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| required by this paragraph, he or she may elect to pay the | 21 |
| additional
contributions plus compound interest at the | 22 |
| effective rate. If such payment
is received by the board, the | 23 |
| service shall be considered as police officer
service in | 24 |
| calculating the retirement annuity under Rule 4 of Section | 25 |
| 15-136.
While performing service described in clause (i) or | 26 |
| (ii) of Rule 4 of Section
15-136, a participating employee | 27 |
| shall be deemed to be employed as a
firefighter for the purpose | 28 |
| of determining the rate of employee contributions
under this | 29 |
| Section.
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| (b) Starting September 1, 1969, each participating | 31 |
| employee shall make
additional contributions of 1/2 of 1% of | 32 |
| earnings to finance a portion
of the cost of the annual | 33 |
| increases in retirement annuity provided under
Section 15-136, | 34 |
| except that with respect to participants in the
self-managed | 35 |
| plan this additional contribution shall be used to finance the
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| benefits obtained under that retirement program.
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| (c) In addition to the amounts described in subsections (a) | 2 |
| and (b) of this
Section, each participating employee shall make | 3 |
| contributions of 1% of earnings
applicable under this system on | 4 |
| and after August 1, 1959. The contributions
made under this | 5 |
| subsection (c) shall be considered as survivor's insurance
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| contributions for purposes of this Article if the employee is | 7 |
| covered under
the traditional benefit package, and such | 8 |
| contributions shall be considered
as additional contributions | 9 |
| for purposes of this Article if the employee is
participating | 10 |
| in the self-managed plan or has elected to participate in the
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| portable benefit package and has completed the applicable | 12 |
| one-year waiting
period. Contributions in excess of $80 during | 13 |
| any fiscal year beginning before
August 31, 1969 and in excess | 14 |
| of $120 during any fiscal year thereafter until
September 1, | 15 |
| 1971 shall be considered as additional contributions for | 16 |
| purposes
of this Article.
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| (d) If the board by board rule so permits and subject to | 18 |
| such conditions
and limitations as may be specified in its | 19 |
| rules, a participant may make
other additional contributions of | 20 |
| such percentage of earnings or amounts as
the participant shall | 21 |
| elect in a written notice thereof received by the board.
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| (e) That fraction of a participant's total accumulated | 23 |
| normal
contributions, the numerator of which is equal to the | 24 |
| number of years of
service in excess of that which is required | 25 |
| to qualify for the maximum
retirement annuity, and the | 26 |
| denominator of which is equal to the total
service of the | 27 |
| participant, shall be considered as accumulated additional
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| contributions. The determination of the applicable maximum | 29 |
| annuity and
the adjustment in contributions required by this | 30 |
| provision shall be made
as of the date of the participant's | 31 |
| retirement.
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| (f) Notwithstanding the foregoing, a participating | 33 |
| employee shall not
be required to make contributions under this | 34 |
| Section after the date upon
which continuance of such | 35 |
| contributions would otherwise cause his or her
retirement | 36 |
| annuity to exceed the maximum retirement annuity as specified |
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| in
clause (1) of subsection (c) of Section 15-136.
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| (g) A participating employee may make contributions for the | 3 |
| purchase of
service credit under this Article.
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| (Source: P.A. 90-32, eff. 6-27-97; 90-65, eff. 7-7-97; 90-448, | 5 |
| eff. 8-16-97;
90-511, eff. 8-22-97; 90-576, eff. 3-31-98; | 6 |
| 90-655, eff. 7-30-98; 90-766, eff.
8-14-98.)
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| Section 99. Effective date. This Act takes effect upon | 8 |
| becoming law.
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