State of Illinois
90th General Assembly

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      40 ILCS 5/5-132.3 new
      30 ILCS 805/8.21 new
          Amends the Chicago Police Article of the Pension Code  to
      provide early retirement incentives.  Grants up to 5 years of
      creditable  service  and  up  to  5 years of age enhancement.
      Requires employee contributions at  half  the  regular  rate.
      Requires  the  City  to  pay  the  resulting unfunded accrued
      liability to the Fund over 7 years,  with  interest.   Amends
      the  State  Mandates  Act  to  require implementation without
      reimbursement.  Effective immediately.
 1        AN ACT to amend  the  Illinois  Pension  Code  by  adding
 2    Section 5-132.3 and to amend the State Mandates Act.
 3        Be  it  enacted  by  the People of the State of Illinois,
 4    represented in the General Assembly:
 5        Section 5. The Illinois Pension Code is amended by adding
 6    Section 5-132.3 as follows:
 7        (40 ILCS 5/5-132.3 new)
 8        Sec. 5-132.3. Early retirement incentives.
 9        (a)  To be eligible for the  benefits  provided  in  this
10    Section, a person must:
11             (1)  on  any  day  during  October,  1997, be (i) an
12        active policeman  participating  in  the  Fund,  (ii)  on
13        layoff  status  from  such  a  position  with  a right of
14        re-employment or recall to service, or (iii) on leave  of
15        absence  from  such  a position, but only if the employee
16        has not been receiving  disability  benefits  under  this
17        Article  for a continuous period of 2 years or more as of
18        the date of application;
19             (2)  have not previously retired under this Article;
20             (3)  file with the Board on or before July 1,  1998,
21        a written application requesting the benefits provided in
22        this Section;
23             (4)  establish  eligibility  to receive a retirement
24        annuity under this Article (for  which  purpose  any  age
25        enhancement  or  creditable  service  received under this
26        Section may be used) and elect to receive the  retirement
27        annuity  beginning  not earlier than the first day of the
28        month following the month in which this amendatory Act of
29        1997 takes effect, and not later than January 1, 1999  or
30        such  other  date  as may be established under subsection
31        (e).
                            -2-                LRB9002054EGfg
 1        (b)  An eligible person may establish up to  5  years  of
 2    creditable  service  under this Article, in increments of one
 3    month, by making the contributions  specified  in  subsection
 4    (c).   In  addition,  for  each  month  of creditable service
 5    established under this Section, a person's age at  retirement
 6    shall be deemed to be one month older than it actually is.
 7        The creditable service established under this Section may
 8    be  used  for all purposes under this Article, except that it
 9    shall not affect the computation of salary.
10        The age enhancement established under this Section may be
11    used for all purposes under this Article, except for purposes
12    of calculating annuities based on a  money-purchase  formula,
13    the  reversionary  annuity  under  Section  5-132.2,  and any
14    distributions based upon age that are required under  federal
15    law.
16        (c)  For  all  creditable  service established under this
17    Section,  a  person  must  pay  to  the  Fund   an   employee
18    contribution  to  be  determined  by  the  Fund, based on the
19    amount of service  to  be  established,  the  member's  final
20    average salary (as used in computing the retirement annuity),
21    and  one-half  of  the  total retirement contribution rate in
22    effect for the member under  this  Article  on  the  date  of
23    withdrawal.   The  employee  may  elect  to  pay  the  entire
24    contribution  before  the retirement annuity commences, or to
25    have it deducted from the annuity over a  period  not  longer
26    than  24  months.   If  the  retired employee dies before the
27    contribution has been paid in full, the  unpaid  installments
28    may  be deducted from any annuity or other benefit payable to
29    the employee's survivors.
30        (d)  Notwithstanding Section 5-159, an annuitant who  has
31    received any age enhancement or creditable service under this
32    Section  and  who  reenters  service under this Article other
33    than as a part-time crossing guard shall thereby forfeit such
34    age enhancement and creditable service, and  become  entitled
                            -3-                LRB9002054EGfg
 1    to  a  refund  of  the  contributions  made  pursuant to this
 2    Section.
 3        (e)  In order to ensure that the public health and safety
 4    are not jeopardized by the simultaneous retirement  of  large
 5    numbers  of  critical  personnel,  the  superintendent of the
 6    police department may extend the January 1, 1999 deadline for
 7    beginning to receive a retirement annuity that is established
 8    in subdivision (a)(4) of this Section to a date no later than
 9    January 1, 2000, by notifying the Board in writing  no  later
10    than October 31, 1998.
11        (f)  The  Board  shall  determine  the  unfunded  accrued
12    liability   created  by  the  granting  of  early  retirement
13    benefits to policemen under this Section, and  shall  certify
14    the  amount  of  that  liability  to  the mayor, comptroller,
15    treasurer, and city council of the City by February 1,  1999,
16    or  as  soon  thereafter as is practical.  In addition to any
17    other payments to the Fund required under this Code, the City
18    shall pay to the Fund the amount  of  that  unfunded  accrued
19    liability  over  a  period of 7 years at the rate of 14.3% of
20    the certified amount per year, plus interest  on  the  unpaid
21    balance  at  the  actuarial  rate as calculated and certified
22    annually by the Board.
23        Section 90.  The State Mandates Act is amended by  adding
24    Section 8.21 as follows:
25        (30 ILCS 805/8.21 new)
26        Sec.  8.21.  Exempt  mandate.  Notwithstanding Sections 6
27    and 8 of this Act, no reimbursement by the State is  required
28    for  the  implementation  of  any  mandate  created  by  this
29    amendatory Act of 1997.
30        Section  99.  Effective date.  This Act takes effect upon
31    becoming law.

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