Full Text of SB3663 096th General Assembly
SB3663 96TH GENERAL ASSEMBLY
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96TH GENERAL ASSEMBLY
State of Illinois
2009 and 2010 SB3663
Introduced 2/11/2010, by Sen. Michael Noland SYNOPSIS AS INTRODUCED: |
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40 ILCS 5/7-139 |
from Ch. 108 1/2, par. 7-139 |
30 ILCS 805/8.34 new |
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Amends the IMRF Article of the Illinois Pension Code. Amends the State Mandates Act to require implementation without reimbursement. Allows for establishment of creditable service for creditable service for unused sick leave with school districts and other specified educational entities even if the employee was not in service with the employer within 60 days of the effective date of his or her retirement annuity. Makes other related changes. 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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SB3663 |
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LRB096 20216 AMC 35788 b |
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| AN ACT concerning public employee benefits.
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| Be it enacted by the People of the State of Illinois,
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| represented in the General Assembly:
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| Section 5. The Illinois Pension Code is amended by changing | 5 |
| Section 7-139 as follows:
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| (40 ILCS 5/7-139) (from Ch. 108 1/2, par. 7-139)
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| Sec. 7-139. Credits and creditable service to employees.
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| (a) Each participating employee shall be granted credits | 9 |
| and creditable
service, for purposes of determining the amount | 10 |
| of any annuity or benefit
to which he or a beneficiary is | 11 |
| entitled, as follows:
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| 1. For prior service: Each participating employee who | 13 |
| is an employee
of a participating municipality or | 14 |
| participating instrumentality on the
effective date shall | 15 |
| be granted creditable service, but no credits under
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| paragraph 2 of this subsection (a), for periods of prior | 17 |
| service for which
credit has not been received under any | 18 |
| other pension fund or retirement system
established under | 19 |
| this Code, as follows:
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| If the effective date of participation for the | 21 |
| participating municipality
or participating | 22 |
| instrumentality is on or before January 1, 1998, creditable
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| service shall be granted for the entire period of prior |
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| service with that
employer without any employee | 2 |
| contribution.
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| If the effective date of participation for the | 4 |
| participating municipality
or participating | 5 |
| instrumentality is after January 1, 1998, creditable
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| service shall be granted for the last 20% of the period of | 7 |
| prior service with
that employer, but no more than 5 years, | 8 |
| without any employee contribution. A
participating | 9 |
| employee may establish creditable service for the | 10 |
| remainder of
the period of prior service with that employer | 11 |
| by making an application in
writing, accompanied by payment | 12 |
| of an employee contribution in an
amount determined by the | 13 |
| Fund, based on the employee contribution rates in
effect at | 14 |
| the time of application for the creditable service and the | 15 |
| employee's
salary rate on the effective date of | 16 |
| participation for that employer, plus
interest at the | 17 |
| effective rate from the date of the prior service to the | 18 |
| date
of payment. Application for this creditable service | 19 |
| may be made at any time
while the employee is still in | 20 |
| service.
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| A municipality that (i) has at least 35 employees; (ii) | 22 |
| is located in a county with at least 2,000,000 inhabitants; | 23 |
| and (iii) maintains an independent defined benefit pension | 24 |
| plan for the benefit of its eligible employees may restrict | 25 |
| creditable service in whole or in part for periods of prior | 26 |
| service with the employer if the governing body of the |
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| municipality adopts an irrevocable resolution to restrict | 2 |
| that creditable service and files the resolution with the | 3 |
| board before the municipality's effective date of | 4 |
| participation.
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| Any person who has withdrawn from the service of a | 6 |
| participating
municipality
or participating | 7 |
| instrumentality prior to the effective date, who reenters
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| the service of the same municipality or participating | 9 |
| instrumentality after
the effective date and becomes a | 10 |
| participating employee is entitled to
creditable service | 11 |
| for prior service as otherwise provided in this
subdivision | 12 |
| (a)(1) only if he or she renders 2 years of service as a
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| participating employee after the effective date. | 14 |
| Application
for such service must be made while in a | 15 |
| participating status.
The salary rate to be used in the | 16 |
| calculation of the required employee
contribution, if any, | 17 |
| shall be the employee's salary rate at the time of first
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| reentering service with the employer after the employer's | 19 |
| effective date of
participation.
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| 2. For current service, each participating employee | 21 |
| shall be
credited with:
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| a. Additional credits of amounts equal to each | 23 |
| payment of additional
contributions received from him | 24 |
| under Section 7-173, as of the
date the corresponding | 25 |
| payment of earnings is payable to him.
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| b. Normal credits of amounts equal to each payment |
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| of normal
contributions received from him, as of the | 2 |
| date the corresponding payment of
earnings is payable | 3 |
| to him, and normal contributions made for the purpose | 4 |
| of
establishing out-of-state service credits as | 5 |
| permitted under the conditions set
forth in paragraph 6 | 6 |
| of this subsection (a).
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| c. Municipality credits in an amount equal to 1.4 | 8 |
| times the normal
credits, except those established by | 9 |
| out-of-state service credits, as of
the date of | 10 |
| computation of any benefit if these credits would | 11 |
| increase
the benefit.
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| d. Survivor credits equal to each payment of | 13 |
| survivor contributions
received from the participating | 14 |
| employee as of the date the
corresponding payment of | 15 |
| earnings is payable, and survivor contributions made
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| for the purpose of establishing out-of-state service | 17 |
| credits.
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| 3. For periods of temporary and total and permanent | 19 |
| disability
benefits, each employee receiving disability | 20 |
| benefits shall be granted
creditable service for the period | 21 |
| during which disability benefits are
payable. Normal and | 22 |
| survivor credits, based upon the rate of earnings
applied | 23 |
| for disability benefits, shall also be granted if such | 24 |
| credits
would result in a higher benefit to any such | 25 |
| employee or his
beneficiary.
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| 4. For authorized leave of absence without pay: A |
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| participating
employee shall be granted credits and | 2 |
| creditable service for periods of
authorized leave of | 3 |
| absence without pay under the following
conditions:
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| a. An application for credits and creditable | 5 |
| service is submitted to the
board while the employee is | 6 |
| in a status of
active employment, and within 2 years | 7 |
| after termination of the
leave of absence period for | 8 |
| which credits and creditable service are
sought.
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| b. Not more than 12 complete months of creditable | 10 |
| service
for authorized leave of absence without pay | 11 |
| shall be counted for purposes of
determining any | 12 |
| benefits payable under this Article.
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| c. Credits and creditable service shall be granted | 14 |
| for leave of
absence only if such leave is approved by | 15 |
| the governing body of the
municipality, including | 16 |
| approval of the estimated cost thereof to the
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| municipality as determined by the fund, and employee | 18 |
| contributions, plus
interest at the effective rate | 19 |
| applicable for each year from the end of
the period of | 20 |
| leave to date of payment, have been paid to the fund in
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| accordance with Section 7-173. The contributions shall | 22 |
| be computed upon the
assumption earnings continued | 23 |
| during the period of leave at the rate in
effect when | 24 |
| the leave began.
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| d. Benefits under the provisions of Sections | 26 |
| 7-141, 7-146, 7-150
and 7-163 shall become payable to |
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| employees on authorized leave of
absence, or their | 2 |
| designated beneficiary, only if such leave of absence
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| is creditable hereunder, and if the employee has at | 4 |
| least one year of
creditable service other than the | 5 |
| service granted for leave of absence.
Any employee | 6 |
| contributions due may be deducted from any benefits
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| payable.
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| e. No credits or creditable service shall be | 9 |
| allowed for leave of
absence without pay during any | 10 |
| period of prior service.
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| 5. For military service: The governing body of a | 12 |
| municipality or
participating instrumentality may elect to | 13 |
| allow creditable service to
participating employees who | 14 |
| leave their employment to serve in the armed
forces of the | 15 |
| United States for all periods of such service, provided
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| that the person returns to active employment within 90 days | 17 |
| after
completion
of full time active duty, but no | 18 |
| creditable service shall be allowed such
person for any | 19 |
| period that can be used in the computation of a pension
or | 20 |
| any other pay or benefit, other than pay for active duty, | 21 |
| for service
in any branch of the armed forces of the United | 22 |
| States. If necessary to
the computation of any benefit, the | 23 |
| board shall establish municipality
credits for | 24 |
| participating employees under this paragraph on the
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| assumption that the employee received earnings at the rate | 26 |
| received at
the time he left the employment to enter the |
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| armed forces. A
participating employee in the armed forces | 2 |
| shall not be considered an
employee during such period of | 3 |
| service and no additional death and no
disability benefits | 4 |
| are payable for death or disability during such period.
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| Any participating employee who left his employment | 6 |
| with a
municipality or participating instrumentality to | 7 |
| serve in the armed
forces of the United States and who | 8 |
| again became a participating
employee within 90 days after | 9 |
| completion of full time active duty by
entering the service | 10 |
| of a different municipality or participating
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| instrumentality, which has elected to allow creditable | 12 |
| service for
periods of military service under the preceding | 13 |
| paragraph, shall also be
allowed creditable service for his | 14 |
| period of military service on the
same terms that would | 15 |
| apply if he had been employed, before entering
military | 16 |
| service, by the municipality or instrumentality which | 17 |
| employed
him after he left the military service and the | 18 |
| employer costs arising in
relation to such grant of | 19 |
| creditable service shall be charged to and
paid by that | 20 |
| municipality or instrumentality.
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| Notwithstanding the foregoing, any participating | 22 |
| employee
shall be entitled to creditable service as | 23 |
| required by any federal law
relating to re-employment | 24 |
| rights of persons who served in the United States
Armed | 25 |
| Services. Such creditable service shall be granted upon | 26 |
| payment by
the member of an amount equal to the employee |
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| contributions which would
have been required had the | 2 |
| employee continued in service at the same
rate of earnings | 3 |
| during the military leave period, plus interest at
the | 4 |
| effective rate.
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| 5.1. In addition to any creditable service established | 6 |
| under
paragraph 5 of this subsection (a), creditable | 7 |
| service may be granted for
up to 48 months of service in | 8 |
| the armed forces of the United States.
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| In order to receive creditable service for military | 10 |
| service under this
paragraph 5.1, a participating employee | 11 |
| must (1) apply to the Fund
in writing and provide evidence | 12 |
| of the military service that is satisfactory
to the Board; | 13 |
| (2) obtain the written approval of the current employer; | 14 |
| and (3)
make contributions to the Fund equal to (i)
the | 15 |
| employee contributions that would have been required had | 16 |
| the service been
rendered as a member, plus (ii) an amount | 17 |
| determined by the board to be equal
to the employer's | 18 |
| normal cost of the benefits accrued for that military
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| service, plus (iii) interest on items (i) and (ii) from the | 20 |
| date of first
membership in the Fund to the date of | 21 |
| payment. The required interest shall be
calculated at the | 22 |
| regular interest rate.
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| The changes made to this paragraph 5.1 by Public Acts | 24 |
| 95-483 and 95-486
apply only to participating employees in | 25 |
| service on or after August 28, 2007 (the effective date of | 26 |
| those Public Acts).
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| 6. For out-of-state service: Creditable service shall | 2 |
| be granted for
service rendered to an out-of-state local | 3 |
| governmental body under the
following conditions: The | 4 |
| employee had participated and has irrevocably
forfeited | 5 |
| all rights to benefits in the out-of-state public employees
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| pension system; the governing body of his participating | 7 |
| municipality or
instrumentality authorizes the employee to | 8 |
| establish such service; the
employee has 2 years current | 9 |
| service with this municipality or
participating | 10 |
| instrumentality; the employee makes a payment of
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| contributions, which shall be computed at 8% (normal) plus | 12 |
| 2% (survivor)
times length of service purchased times the | 13 |
| average rate of earnings for the
first 2
years of service | 14 |
| with the municipality or participating
instrumentality | 15 |
| whose governing body authorizes the service established
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| plus interest at the effective rate on the date such | 17 |
| credits are
established, payable from the date the employee | 18 |
| completes the required 2
years of current service to date | 19 |
| of payment. In no case shall more than
120 months of | 20 |
| creditable service be granted under this provision.
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| 7. For retroactive service: Any employee who could have | 22 |
| but did not
elect to become a participating employee, or | 23 |
| who should have been a
participant in the Municipal Public | 24 |
| Utilities Annuity and Benefit Fund
before that fund was | 25 |
| superseded, may receive creditable service for the
period | 26 |
| of service not to exceed 50 months; however, a current or |
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| former
elected or appointed official of a participating | 2 |
| municipality may establish credit under this paragraph 7 | 3 |
| for more than 50
months of service as an official of that | 4 |
| municipality, if the excess over 50 months is approved by | 5 |
| resolution of the
governing body of the affected | 6 |
| municipality filed with
the Fund before January 1, 2002.
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| Any employee who is a
participating employee on or | 8 |
| after September 24, 1981 and who was
excluded from | 9 |
| participation by the age restrictions removed by Public Act
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| 82-596 may receive creditable service for the period, on or | 11 |
| after January
1, 1979, excluded by the age restriction and, | 12 |
| in addition, if the governing
body of the participating | 13 |
| municipality or participating instrumentality elects
to | 14 |
| allow creditable service for all employees excluded by the | 15 |
| age restriction
prior to January 1, 1979, for service | 16 |
| during the period prior to that date
excluded by the age | 17 |
| restriction. Any employee who was excluded from
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| participation by the age restriction removed by Public Act | 19 |
| 82-596 and who is
not a participating employee on or after | 20 |
| September 24, 1981 may receive
creditable service for | 21 |
| service after January 1,
1979. Creditable service under | 22 |
| this paragraph
shall be granted upon payment of the | 23 |
| employee contributions
which would have been required had | 24 |
| he participated, with interest at the
effective rate for | 25 |
| each year from the end of the period of service
established | 26 |
| to date of payment.
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| 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:
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| a. Sick leave days shall be limited to those | 7 |
| accumulated under a sick
leave plan established by a | 8 |
| participating municipality or participating
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| instrumentality which is available to all employees or | 10 |
| a class of employees.
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| b. Except as provided in item b-1, only sick leave | 12 |
| days accumulated with a participating municipality or
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| participating instrumentality with which the employee | 14 |
| was in service within
60 days of the effective date of | 15 |
| his retirement annuity shall be credited;
If the | 16 |
| employee was in service with more than one employer | 17 |
| during this
period only the sick leave days with the | 18 |
| employer with which the employee
has the greatest | 19 |
| number of unpaid sick leave days shall be considered.
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| b-1. If the employee was in the service of more | 21 |
| than one or more employer as defined in item (2) of | 22 |
| paragraph (a) of subsection (A) or paragraph (c) of | 23 |
| subsection (B) of Section 7-132, then the sick leave | 24 |
| days from such employer or all such employers shall be | 25 |
| credited, even if the employee was not in service with | 26 |
| the employer within 60 days of the effective date of |
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| his or her retirement annuity, as long as the | 2 |
| creditable service attributed to those sick leave days | 3 |
| does not exceed the limitation in item d f of this | 4 |
| paragraph 8. In calculating the creditable service | 5 |
| under this item b-1, the sick leave days from the last | 6 |
| employer shall be considered first, then the remaining | 7 |
| sick leave days shall be considered until there are no | 8 |
| more days or the maximum creditable sick leave | 9 |
| threshold under item d f of this paragraph 8 has been | 10 |
| reached.
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| c. The creditable service granted shall be | 12 |
| considered solely for the
purpose of computing the | 13 |
| amount of the retirement annuity and shall not be
used | 14 |
| to establish any minimum service period required by any | 15 |
| provision of the
Illinois Pension Code, the effective | 16 |
| date of the retirement annuity, or the
final rate of | 17 |
| earnings.
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| d. The creditable service shall be at the rate of | 19 |
| 1/20 of a month for
each full sick day, provided that | 20 |
| no more than 12 months may be credited
under this | 21 |
| subdivision 8.
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| e. Employee contributions shall not be required | 23 |
| for creditable service
under this subdivision 8.
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| f. Each participating municipality and | 25 |
| participating instrumentality
with which an employee | 26 |
| has service within 60 days of the effective date of
his |
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| retirement annuity and each employer referenced in | 2 |
| item b-1 of this paragraph 8 shall certify to the board | 3 |
| the number of accumulated
unpaid sick leave days | 4 |
| credited to the employee at the time of termination
of | 5 |
| service.
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| 9. For service transferred from another system: | 7 |
| Credits and
creditable service shall be granted for service | 8 |
| under Article 3, 4, 5, 8, 14,
or 16 of this Act, to any | 9 |
| active member of this Fund, and to any
inactive member who | 10 |
| has been a county sheriff, upon
transfer of such credits | 11 |
| pursuant to Section 3-110.3, 4-108.3, 5-235,
8-226.7,
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| 14-105.6, or 16-131.4, and payment by the member of the | 13 |
| amount by
which (1) the employer and employee contributions | 14 |
| that would have been required
if he had participated in | 15 |
| this Fund as a sheriff's law enforcement employee
during | 16 |
| the period for which credit is
being transferred, plus | 17 |
| interest thereon at the effective rate for each
year, | 18 |
| compounded annually, from the date of termination of the | 19 |
| service for
which credit is being transferred to the date | 20 |
| of payment, exceeds (2) the
amount actually transferred to | 21 |
| the Fund.
Such transferred service shall be deemed to be | 22 |
| service as a sheriff's law
enforcement employee for the | 23 |
| purposes of Section 7-142.1.
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| 10. For service transferred from an Article 3 system | 25 |
| under Section 3-110.8: Credits and
creditable service | 26 |
| shall be granted for service under Article 3 of this Act as |
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| provided in Section 3-110.8, to any active member of this | 2 |
| Fund upon
transfer of such credits pursuant to Section | 3 |
| 3-110.8. If the amount by
which (1) the employer and | 4 |
| employee contributions that would have been required
if he | 5 |
| had participated in this Fund during the period for which | 6 |
| credit is
being transferred, plus interest thereon at the | 7 |
| effective rate for each
year, compounded annually, from the | 8 |
| date of termination of the service for
which credit is | 9 |
| being transferred to the date of payment, exceeds (2) the
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| amount actually transferred to the Fund, then the amount of | 11 |
| creditable service established under this paragraph 10 | 12 |
| shall be reduced by a corresponding amount in accordance | 13 |
| with the rules and procedures established under this | 14 |
| paragraph 10.
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| The board shall establish by rule the manner of making | 16 |
| the calculation required under
this paragraph 10, taking | 17 |
| into account the appropriate actuarial
assumptions; the | 18 |
| member's service, age, and salary history; the level
of | 19 |
| funding of the employer; and
any other factors that the | 20 |
| board determines to be relevant.
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| Until January 1, 2010, members who transferred service | 22 |
| from an Article 3 system under the provisions of Public Act | 23 |
| 94-356 may establish additional credit in this Fund, but | 24 |
| only up to the amount of the service credit reduction in | 25 |
| that transfer, as calculated under the actuarial | 26 |
| assumptions. This credit may be established upon payment by |
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| the member of an amount to be determined by the board, | 2 |
| equal to (1) the amount that would have been contributed as | 3 |
| employee and employer contributions had all the service | 4 |
| been as an employee under this Article, plus interest | 5 |
| thereon compounded annually from the date of service to the | 6 |
| date of transfer, less (2) the total amount transferred | 7 |
| from the Article 3 system, plus (3) interest on the | 8 |
| difference at the effective rate for each year, compounded | 9 |
| annually, from the date of the transfer to the date of | 10 |
| payment. The additional service credit is allowed under | 11 |
| this amendatory Act of the 95th General Assembly | 12 |
| notwithstanding the provisions of Article 3 terminating | 13 |
| all transferred credits on the date of transfer. | 14 |
| (b) Creditable service - amount:
| 15 |
| 1. One month of creditable service
shall be allowed for | 16 |
| each month for which a participating employee made
| 17 |
| contributions as required under Section 7-173, or for which | 18 |
| creditable
service is otherwise granted hereunder. Not | 19 |
| more than 1 month of
service shall be credited and counted | 20 |
| for 1 calendar month, and not more
than 1 year of service | 21 |
| shall be credited and counted for any calendar
year. A | 22 |
| calendar month means a nominal month beginning on the first | 23 |
| day
thereof, and a calendar year means a year beginning | 24 |
| January 1 and ending
December 31.
| 25 |
| 2. A seasonal employee shall be given 12 months of | 26 |
| creditable
service if he renders the number of months of |
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| service normally required
by the position in a 12-month | 2 |
| period and he remains in service for the
entire 12-month | 3 |
| period. Otherwise a fractional year of service in the
| 4 |
| number of months of service rendered shall be credited.
| 5 |
| 3. An intermittent employee shall be given creditable | 6 |
| service for
only those months in which a contribution is | 7 |
| made under Section 7-173.
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| (c) No application for correction of credits or creditable | 9 |
| service shall
be considered unless the board receives an | 10 |
| application for correction while
(1) the applicant is a | 11 |
| participating employee and in active employment
with a | 12 |
| participating municipality or instrumentality, or (2) while | 13 |
| the
applicant is actively participating in a pension fund or | 14 |
| retirement
system which is a participating system under the | 15 |
| Retirement Systems
Reciprocal Act. A participating employee or | 16 |
| other applicant shall not be
entitled to credits or creditable | 17 |
| service unless the required employee
contributions are made in | 18 |
| a lump sum or in installments made in accordance
with board | 19 |
| rule.
| 20 |
| (d) Upon the granting of a retirement, surviving spouse or | 21 |
| child
annuity, a death benefit or a separation benefit, on | 22 |
| account of any
employee, all individual accumulated credits | 23 |
| shall thereupon terminate.
Upon the withdrawal of additional | 24 |
| contributions, the credits applicable
thereto shall thereupon | 25 |
| terminate. Terminated credits shall not be applied
to increase | 26 |
| the benefits any remaining employee would otherwise receive |
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| under
this Article.
| 2 |
| (Source: P.A. 95-483, eff. 8-28-07; 95-486, eff. 8-28-07; | 3 |
| 95-504, eff. 8-28-07; 95-812, eff. 8-13-08; 95-876, eff. | 4 |
| 8-21-08; 96-299, eff. 8-11-09.)
| 5 |
| Section 90. The State Mandates Act is amended by adding | 6 |
| Section 8.34 as follows: | 7 |
| (30 ILCS 805/8.34 new) | 8 |
| Sec. 8.34. Exempt mandate. Notwithstanding Sections 6 and 8 | 9 |
| of this Act, no reimbursement by the State is required for the | 10 |
| implementation of any mandate created by this amendatory Act of | 11 |
| the 96th General Assembly.
| 12 |
| Section 99. Effective date. This Act takes effect upon | 13 |
| becoming law.
|
|