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90_HB0014
40 ILCS 5/11-134.1 from Ch. 108 1/2, par. 11-134.1
40 ILCS 5/11-134.3 from Ch. 108 1/2, par. 11-134.3
30 ILCS 805/8.21 new
Amends the Chicago Laborer Article of the Pension Code to
compound the 3% automatic annual increase in retirement
pension. Amends the State Mandates Act to require
implementation without reimbursement. Effective immediately.
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LRB9000183EGfg
1 AN ACT to amend the Illinois Pension Code by changing
2 Sections 11-134.1 and 11-134.3 and to amend the State
3 Mandates 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 11-134.1 and 11-134.3 as follows:
8 (40 ILCS 5/11-134.1) (from Ch. 108 1/2, par. 11-134.1)
9 Sec. 11-134.1. Automatic increase in annuity. (a) An
10 employee who retired or retires from service after December
11 31, 1963, and before January 1, 1987, having attained age 60
12 or more, shall, in the month of January of the year following
13 the year in which the first anniversary of retirement occurs,
14 have the amount of his then fixed and payable monthly annuity
15 increased by 1 1/2%, and such first fixed annuity as granted
16 at retirement increased by a further 1 1/2% in January of
17 each year thereafter. Beginning with January of the year
18 1972, such increases shall be at the rate of 2% in lieu of
19 the aforesaid specified 1 1/2%. Beginning January, 1984, such
20 increases shall be at the rate of 3%. Beginning on the
21 effective date of this amendatory Act of 1997, such increases
22 shall be at the rate of 3% of the currently payable monthly
23 annuity, including any increases previously granted under
24 this Article. Such employee who retires on annuity prior to
25 age 60 shall receive such increases beginning with January of
26 the year immediately following the year in which he attains
27 the age of 60 years.
28 An employee who retires from service on or after January
29 1, 1987 shall, upon the first annuity payment date following
30 the first anniversary of the date of retirement, or upon the
31 first annuity payment date following attainment of age 60,
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1 whichever occurs later, have his then fixed and payable
2 monthly annuity increased by 3%, and such annuity shall be
3 increased by an additional 3% of the original fixed annuity
4 on the same date each year thereafter. Beginning on the
5 effective date of this amendatory Act of 1997, such increases
6 shall be at the rate of 3% of the currently payable monthly
7 annuity, including any increases previously granted under
8 this Article.
9 (b) The foregoing provision is not applicable to an
10 employee retiring and receiving a term annuity, as defined in
11 this Article, nor to any otherwise qualified employee who
12 retires before he shall have made employee contributions (at
13 the 1/2 of 1% rate as hereinafter provided) for the purposes
14 of this additional annuity for not less than the equivalent
15 of one full year. Such employee, however, shall make
16 arrangement to pay to the fund a balance of such 1/2 of 1%
17 contributions, based on his final salary, as will bring such
18 1/2 of 1% contributions, computed without interest, to the
19 equivalent of or completion of one year's contributions.
20 Beginning with the month of January, 1964, each employee
21 shall contribute by means of salary deductions 1/2 of 1% of
22 each salary payment, concurrently with and in addition to the
23 employee contributions otherwise made for annuity purposes.
24 Each such additional employee contribution shall be
25 credited to an account in the prior service annuity reserve,
26 to be used, together with city contributions, to defray the
27 cost of the specified annuity increments. Any balance as of
28 the beginning of each calendar year existing in such account
29 shall be credited with interest at the rate of 3% per annum.
30 Such employee contributions shall not be subject to
31 refund, except to an employee who resigns or is discharged
32 and applies for refund under this Article, and also in cases
33 where a term annuity becomes payable.
34 In such cases the employee contributions shall be
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1 refunded him, without interest, and charged to the
2 aforementioned account in the prior service annuity reserve.
3 (Source: P.A. 84-1472.)
4 (40 ILCS 5/11-134.3) (from Ch. 108 1/2, par. 11-134.3)
5 Sec. 11-134.3. Automatic increases in annuity for certain
6 heretofore retired participants. A retired employee who (a)
7 is receiving annuity based on a service credit of 20 or more
8 years regardless of age at retirement or based on a service
9 credit of 15 or more years with retirement at age 55 or over,
10 and (b) does not qualify for the automatic increases in
11 annuity provided for in Section 11-134.1 of this Article, and
12 (c) elects to make a contribution to the Fund at a time and
13 manner prescribed by the Retirement Board, of a sum equal to
14 1% of the amount of final monthly salary times the number of
15 full years of service on which the annuity was based in those
16 cases where the annuity was computed on the money purchase
17 formula, and in those cases in which the annuity was computed
18 under the minimum annuity formula provisions of this Article
19 a sum equal to 1% of the average monthly salary on which the
20 annuity was based times such number of full years of service,
21 shall have his original fixed and payable monthly amount of
22 annuity increased in January of the year following the year
23 in which he attains the age of 65 years, if such age of 65
24 years is attained in the year 1969 or later, by an amount
25 equal to 1 1/2%, and by an equal additional 1 1/2% in January
26 of each year thereafter. Beginning with January of the year
27 1972, such increases shall be at the rate of 2% in lieu of
28 the aforesaid specified 1 1/2%. Beginning January, 1984,
29 such increases shall be at the rate of 3%. Beginning on the
30 effective date of this amendatory Act of 1997, such increases
31 shall be at the rate of 3% of the currently payable monthly
32 annuity, including any increases previously granted under
33 this Article.
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1 In those cases in which the retired employee receiving
2 annuity has attained the age of 66 or more years in the year
3 1969, he shall have such annuity increased in January of the
4 year 1970 by an amount equal to 1 1/2% multiplied by the
5 number equal to the number of months of January elapsing from
6 and including January of the year immediately following the
7 year he attained the age of 65 years if retired at or prior
8 to age 65, or from and including January of the year
9 immediately following the year of retirement if retired at an
10 age greater than 65 years, to and including January of the
11 year 1970, and by an equal additional 1 1/2% in January of
12 each year thereafter. Beginning with January of the year
13 1972, such increases shall be at the rate of 2% in lieu of
14 the aforesaid specified 1 1/2%. Beginning January, 1984,
15 such increases shall be at the rate of 3%. Beginning on the
16 effective date of this amendatory Act of 1997, such increases
17 shall be at the rate of 3% of the currently payable monthly
18 annuity, including any increases previously granted under
19 this Article.
20 To defray the annual cost of such increases, the annual
21 interest income of the Fund, accruing from investments held
22 by the Fund, exclusive of gains or losses on sales or
23 exchanges of assets during the year, over and above 4% a
24 year, shall be used to the extent necessary and available to
25 finance the cost of such increases for the following year,
26 and such amount shall be transferred as of the end of each
27 year, beginning with the year 1969, to a Fund account
28 designated as the Supplementary Payment Reserve from the
29 Investment and Interest Reserve set forth in Sec. 11-210. The
30 sums contributed by annuitants as provided for in this
31 Section shall also be placed in the aforesaid Supplementary
32 Payment Reserve and shall be applied for and used for the
33 purposes of such Fund account, together with the aforesaid
34 interest.
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1 In the event the monies in the Supplementary Payment
2 Reserve in any year arising from: (1) the available interest
3 income as defined hereinbefore and accruing in the preceding
4 year above 4% a year and (2) the contributions by retired
5 persons, as set forth hereinbefore, are insufficient to make
6 the total payments to all persons estimated to be entitled to
7 the annuity increases specified hereinbefore, then (3) any
8 interest earnings over 4% a year beginning with the year 1969
9 which were not previously used to finance such increases and
10 which were transferred to the Prior Service Annuity Reserve
11 may be used to the extent necessary and available to provide
12 sufficient funds to finance such increases for the current
13 year, and such sums shall be transferred from the Prior
14 Service Annuity Reserve.
15 In the event the total monies available in the
16 Supplementary Payment Reserve from the preceding indicated
17 sources are insufficient to make the total payments to all
18 persons entitled to such increases for the year, a
19 proportionate amount computed as the ratio of the monies
20 available to the total of the total payments for that year
21 shall be paid to each person for that year.
22 The Fund shall be obligated for the payment of the
23 increases in annuity as provided for in this Section only to
24 the extent that the assets for such purpose, as specified
25 herein, are available.
26 (Source: P.A. 83-802.)
27 Section 90. The State Mandates Act is amended by adding
28 Section 8.21 as follows:
29 (30 ILCS 805/8.21 new)
30 Sec. 8.21. Exempt mandate. Notwithstanding Sections 6
31 and 8 of this Act, no reimbursement by the State is required
32 for the implementation of any mandate created by this
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1 amendatory Act of 1997.
2 Section 99. Effective date. This Act takes effect upon
3 becoming law.