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90_HB0013
40 ILCS 5/8-137 from Ch. 108 1/2, par. 8-137
40 ILCS 5/8-137.1 from Ch. 108 1/2, par. 8-137.1
30 ILCS 805/8.21 new
Amends the Chicago Municipal Article of the Pension Code
to compound the 3% automatic annual increase in retirement
pension. Also makes technical changes. Amends the State
Mandates Act to require implementation without reimbursement.
Effective immediately.
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LRB9000180EGfg
1 AN ACT to amend the Illinois Pension Code by changing
2 Sections 8-137 and 8-137.1 and to amend the State Mandates
3 Act.
4 Be it enacted by the People of the State of Illinois,
5 represented in the General Assembly:
6 Section 5. The Illinois Pension Code is amended by
7 changing Sections 8-137 and 8-137.1 as follows:
8 (40 ILCS 5/8-137) (from Ch. 108 1/2, par. 8-137)
9 Sec. 8-137. Automatic increase in annuity.
10 (a) An employee who retired or retires from service
11 after December 31, 1959 and before January 1, 1987, having
12 attained age 60 or more, shall, in January of the year after
13 the year in which the first anniversary of retirement occurs,
14 have the amount of his or her then fixed and payable monthly
15 annuity increased by 1.5% 1 1/2%, and such first fixed
16 annuity as granted at retirement shall be increased by a
17 further 1.5% 1 1/2% in January of each year thereafter.
18 Beginning in with January of the year 1972, such increases
19 shall be at the rate of 2% in lieu of the aforesaid specified
20 1 1/2%, and beginning in with January of the year 1984, such
21 increases shall be at the rate of 3%. Beginning on the
22 effective date of this amendatory Act of 1997, such increases
23 shall be at the rate of 3% of the currently payable monthly
24 annuity, including any increases previously granted under
25 this Article. An such employee who retires on annuity after
26 December 31, 1959 and before January 1, 1987, but before
27 attaining age 60, shall receive such increases beginning in
28 January of the year after the year in which he or she attains
29 age 60.
30 An employee who retires from service on or after January
31 1, 1987 shall, upon the first annuity payment date following
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1 the first anniversary of the date of retirement, or upon the
2 first annuity payment date following attainment of age 60,
3 whichever occurs later, have his or her then fixed and
4 payable monthly annuity increased by 3%, and the such annuity
5 shall be increased by an additional 3% of the original fixed
6 annuity on the same date each year thereafter. Beginning on
7 the effective date of this amendatory Act of 1997, such
8 increases shall be at the rate of 3% of the currently payable
9 monthly annuity, including any increases previously granted
10 under this Article.
11 (b) Subsection (a) The foregoing provision is not
12 applicable to an employee retiring and receiving a term
13 annuity., as herein defined, nor
14 Subsection (a) is not applicable to any otherwise
15 qualified employee who retires before making the he makes
16 employee contributions specified in subsection (c) (at the
17 1/2 of 1% rate as provided in this Act) for this additional
18 annuity for not less than the equivalent of one full year,
19 unless the. Such employee arranges at the time of retirement
20 to pay, however, shall make arrangement to pay to the Fund an
21 amount, a balance of such 1/2 of 1% contributions, based on
22 his or her final salary and, as will bring such 1/2 of 1%
23 contributions, computed without interest, that will bring the
24 employee's contributions under subsection (c) to the
25 equivalent of or completion of one year's contributions.
26 (c) Beginning with January, 1960, each employee shall
27 contribute by means of salary deductions 0.5% 1/2 of 1% of
28 each salary payment, concurrently with and in addition to the
29 employee contributions otherwise made for annuity purposes.
30 Each such additional contribution shall be credited to an
31 account in the Prior Service Annuity Reserve, to be used,
32 together with city contributions, to defray the cost of the
33 specified annuity increments. Any balance in such account At
34 the beginning of each calendar year, the account shall be
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1 credited with interest at the rate of 3% per annum.
2 Such additional employee contributions are not
3 refundable, except to an employee who withdraws and applies
4 for a refund under this Article, and in cases where a term
5 annuity becomes payable. In such cases the employee's his
6 contributions shall be refunded, without interest, and
7 charged to the such account in the Prior Service Annuity
8 Reserve.
9 (Source: P.A. 84-1472.)
10 (40 ILCS 5/8-137.1) (from Ch. 108 1/2, par. 8-137.1)
11 Sec. 8-137.1. Automatic increases in annuity for certain
12 heretofore retired participants. A retired municipal
13 employee who (a) is receiving a retirement annuity based on a
14 service credit of 20 or more years of service credit
15 regardless of age at retirement, or based on a service credit
16 of 15 or more years of service credit with retirement at age
17 55 or over, and (b) does not qualify for the automatic
18 increases in annuity provided for in Section 8-137 of this
19 Article, and (c) elects to contribute make a contribution to
20 the Fund, at a time and in a manner prescribed by the
21 Retirement Board, of a sum equal to 1% of the amount of final
22 monthly salary times the number of full years of service on
23 which the annuity was based in those cases where the annuity
24 was computed on the money purchase formula, or and in those
25 cases in which the annuity was computed under the minimum
26 annuity formula provisions of this Article a sum equal to 1%
27 of the average monthly salary on which the annuity was based
28 times the such number of full years of service, shall have
29 his or her original fixed and payable monthly amount of
30 annuity increased in January of the year following the year
31 in which he or she attains the age of 65 years, if that such
32 age of 65 years is attained in the year 1969 or later, by an
33 amount equal to 1.5% 1 1/2%, and by an equal additional 1.5%
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1 1 1/2% in January of each year thereafter. Beginning in with
2 January of the year 1972, such increases shall be at the rate
3 of 2% in lieu of the aforesaid specified 1 1/2%, and
4 beginning in January of the year 1984, such increases shall
5 be at the rate of 3%. Beginning on the effective date of
6 this amendatory Act of 1997, such increases shall be at the
7 rate of 3% of the currently payable monthly annuity,
8 including any increases previously granted under this
9 Article.
10 A Whenever the retired municipal employee who is
11 receiving a retirement annuity and who has attained the age
12 of 66 or more in 1969 or before, he shall have the such
13 annuity increased in January, 1970 by an amount equal to 1.5%
14 of the originally granted annuity 1 1/2% multiplied by the
15 number of years that have elapsed equal to the number of
16 months of January elapsing from and including January of the
17 year immediately following the year he or she attained the
18 age of 65 if the employee retired at or before age 65, or
19 from and including January of the year immediately following
20 the year of retirement if the employee retired at an age
21 greater than 65, to and including January, 1970, and by an
22 equal additional 1.5% 1-1/2% in January of each year
23 thereafter. Beginning in with January of the year 1972, such
24 increases shall be at the rate of 2% in lieu of the aforesaid
25 specified 1 1/2%, and beginning in January of the year 1984,
26 such increases shall be at the rate of 3%. Beginning on the
27 effective date of this amendatory Act of 1997, these
28 increases shall be at the rate of 3% of the currently payable
29 monthly annuity, including any increases previously granted
30 under this Article.
31 To defray the annual cost of these such increases, the
32 annual interest income of the Fund, accruing from investments
33 held by the Fund, exclusive of gains or losses on sales or
34 exchanges of assets during the year, over and above 4% a
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1 year, shall be used to the extent necessary and available to
2 finance the cost of the such increases for the following
3 year, and such amount shall be transferred as of the end of
4 each year, beginning with the year 1969, to a Fund account
5 designated as the Supplementary Payment Reserve from the
6 Investment and Interest Reserve set forth in Section 8-221.
7 The sums contributed by annuitants under as provided for in
8 this Section shall also be placed in the aforesaid
9 Supplementary Payment Reserve and shall be applied and used
10 for the purposes of that such Fund account, together with the
11 aforesaid interest.
12 If In the event the monies in the Supplementary Payment
13 Reserve in any year arising from: (1) the available interest
14 income as defined hereinbefore and accruing in the preceding
15 year over above 4% a year and (2) the contributions by
16 retired persons, as set forth hereinbefore, are insufficient
17 to make the total payments to all persons estimated to be
18 entitled to the annuity increases specified in this Section
19 hereinbefore, then (3) any interest earnings over 4% a year
20 earned in beginning with the year 1969 or later that which
21 were not previously used to finance such increases and that
22 have been which were transferred to the Prior Service Annuity
23 Reserve may be used to the extent necessary and available to
24 provide sufficient funds to finance such increases for the
25 current year, and such sums shall be transferred to the
26 Supplementary Payment Reserve from the Prior Service Annuity
27 Reserve.
28 If In the event the total monies available in the
29 Supplementary Payment Reserve from the preceding indicated
30 sources are insufficient to make the total payments to all
31 persons entitled to such increases for the year, a
32 proportionate amount computed as the ratio of the monies
33 available to the total of the total payments for that year
34 shall be paid to each person for that year.
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1 The Fund shall be obligated for the payment of the
2 increases in annuity under as provided for in this Section
3 only to the extent that the assets for such purpose, as
4 specified herein, are available.
5 (Source: P.A. 83-802.)
6 Section 90. The State Mandates Act is amended by adding
7 Section 8.21 as follows:
8 (30 ILCS 805/8.21 new)
9 Sec. 8.21. Exempt mandate. Notwithstanding Sections 6
10 and 8 of this Act, no reimbursement by the State is required
11 for the implementation of any mandate created by this
12 amendatory Act of 1997.
13 Section 99. Effective date. This Act takes effect upon
14 becoming law.