State of Illinois
90th General Assembly
Legislation

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90_HB0727

      40 ILCS 5/14-108          from Ch. 108 1/2, par. 14-108
      40 ILCS 5/15-136          from Ch. 108 1/2, par. 15-136
      40 ILCS 5/16-133          from Ch. 108 1/2, par. 16-133
      40 ILCS 5/17-116          from Ch. 108 1/2, par. 17-116
      30 ILCS 805/8.21 new
          Amends  the  State  Employee,   Universities,   Downstate
      Teacher,  and Chicago Teacher Articles of the Pension Code to
      provide for a new retirement formula of  1.67%  per  year  of
      service  for regular coordinated members and 2.2% per year of
      service for regular noncoordinated members.  Amends the State
      Mandates Act to require implementation without reimbursement.
      Effective immediately.
                                                     LRB9000557EGfg
                                               LRB9000557EGfg
 1        AN ACT in relation to public employee pensions,  amending
 2    named Acts.
 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
 6    changing  Sections  14-108,  15-136,  16-133,  and  17-116 as
 7    follows:
 8        (40 ILCS 5/14-108) (from Ch. 108 1/2, par. 14-108)
 9        (Text of Section before amendment by P.A. 89-507)
10        Sec. 14-108. Amount of retirement annuity.  A member  who
11    has  contributed  to the System for at least 12 months, shall
12    be entitled to a prior  service  annuity  for  each  year  of
13    certified prior service credited to him, except that a member
14    shall  receive 1/3 of the prior service annuity for each year
15    of service for which contributions have been made and all  of
16    such  annuity  shall  be  payable  after  the member has made
17    contributions for a period of 3 years.  Proportionate amounts
18    shall be payable for service of less than a full  year  after
19    completion of at least 12 months.
20        The   total   period  of  service  to  be  considered  in
21    establishing the  measure  of  prior  service  annuity  shall
22    include  service  credited in the Teachers' Retirement System
23    of  the  State  of  Illinois  and  the   State   Universities
24    Retirement  System  for which contributions have been made by
25    the member to such systems; provided that at least 1 year  of
26    the total period of 3 years prescribed for the allowance of a
27    full  measure  of  prior  service  annuity  shall  consist of
28    membership service in this System for which credit  has  been
29    granted.
30        (a)  In  the  case of a member who retires after December
31    31, 1997 and is a noncovered employee, the retirement annuity
                            -2-                LRB9000557EGfg
 1    for membership service and prior service shall be 2.2%  1.67%
 2    of  final average compensation for each of the first 10 years
 3    of service; 1.90% for each of the next 10 years  of  service;
 4    2.10%  for  each  year  of  service  in  excess of 20 but not
 5    exceeding 30; and 2.30% for each year in excess of  30.   Any
 6    service  credit  established  as  a covered employee shall be
 7    considered in  determining  the  applicable  percentages  and
 8    computed as stated in paragraph (b).
 9        (b)  In  the  case of a member who retires after December
10    31, 1997 and is a covered employee,  the  retirement  annuity
11    for membership service and prior service shall be computed as
12    stated in paragraph (a) for all service credit established as
13    a  noncovered  employee;  for service credit established as a
14    covered  employee  it  shall  be  1.67%  of   final   average
15    compensation  1%  for  each of the first 10 years of service;
16    1.10% for each of the next 10 years  of  service;  1.30%  for
17    each  year  of  service in excess of 20 but not exceeding 30;
18    and 1.50% for each year of service  in  excess  of  30.   Any
19    service  credit established as a noncovered employee shall be
20    considered in determining the applicable percentages.
21        (c)  For a member with 30  but  less  than  35  years  of
22    creditable service retiring after attaining age 55 but before
23    age  60, the retirement annuity shall be reduced by 1/2 of 1%
24    for each month that the member's age is under age 60  at  the
25    time of retirement.
26        (d)  A  retirement  annuity shall not exceed 75% of final
27    average compensation, subject to such extension as may result
28    from the application of Section 14-114 or Section 14-115.
29        (e)  The  retirement  annuity  payable  to  any   covered
30    employee  who  is  a  member  of the System and in service on
31    January 1, 1969, or in service thereafter in 1969 as a result
32    of legislation  enacted  by  the  Illinois  General  Assembly
33    transferring  the  member  to  State  employment  from county
34    employment in a county Department of Public Aid  in  counties
                            -3-                LRB9000557EGfg
 1    of 3,000,000 or more population, under a plan of coordination
 2    with   the  Old  Age,  Survivors  and  Disability  provisions
 3    thereof, if not fully insured for Old Age Insurance  payments
 4    under the Federal Old Age, Survivors and Disability Insurance
 5    provisions at the date of acceptance of a retirement annuity,
 6    shall  not be less than the amount for which the member would
 7    have been eligible if coordination were not applicable.
 8        (f)  The  retirement  annuity  payable  to  any   covered
 9    employee  who  is  a  member  of the System and in service on
10    January 1, 1969, or in service thereafter in 1969 as a result
11    of the legislation designated in  the  immediately  preceding
12    paragraph,  if  fully  insured for Old Age Insurance payments
13    under  the  Federal  Social  Security  Act  at  the  date  of
14    acceptance of a retirement annuity, shall not be less than an
15    amount which when added  to  the  Primary  Insurance  Benefit
16    payable  to  the  member upon attainment of age 65 under such
17    Federal Act, will equal the annuity which would otherwise  be
18    payable   if  the  coordinated  plan  of  coverage  were  not
19    applicable.
20        (g)  In the case of a member who retires  after  December
21    31, 1997 and is a noncovered employee, the retirement annuity
22    for  membership  service  as a full-time security employee of
23    the Department of Corrections or  security  employee  of  the
24    Department  of  Mental  Health and Developmental Disabilities
25    shall be 2.25% 1.9% of final average compensation for each of
26    the first 30 10 years of service; 2.1% for each of  the  next
27    10 years of service; 2.25% for each year of service in excess
28    of  20 but not exceeding 30; and 2.5% for each year in excess
29    of 30.
30        (h)  In the case of a member who is a  covered  employee,
31    the  retirement annuity for membership service as a full-time
32    security  employee  of  the  Department  of  Corrections   or
33    security  employee  of  the  Department  of Mental Health and
34    Developmental Disabilities shall be 1.67%  of  final  average
                            -4-                LRB9000557EGfg
 1    compensation for each of the first 10 years of service; 1.90%
 2    for each of the next 10 years of service; 2.10% for each year
 3    of  service  in  excess of 20 but not exceeding 30; and 2.30%
 4    for each year in excess of 30.
 5        (i)  For the purposes of this Section and Section  14-133
 6    of this Act, the term "security employee of the Department of
 7    Corrections"   and   the   term  "security  employee  of  the
 8    Department of Mental Health and  Developmental  Disabilities"
 9    shall have the meanings ascribed to them in subsection (c) of
10    Section 14-110.
11        (j)  The   retirement   annuity   computed   pursuant  to
12    paragraphs (g) or (h)  shall  be  applicable  only  to  those
13    security  employees  of  the  Department  of  Corrections and
14    security employees of the Department  of  Mental  Health  and
15    Developmental  Disabilities  who  have  at  least 20 years of
16    membership  service  and  who  are  not  eligible   for   the
17    alternative retirement annuity provided under Section 14-110.
18    However,  persons  transferring  to this System under Section
19    14-108.2 who have service credit under  Article  16  of  this
20    Code   may  count  such  service  toward  establishing  their
21    eligibility under the 20-year  service  requirement  of  this
22    subsection;   but   such   service   may  be  used  only  for
23    establishing such eligibility, and not  for  the  purpose  of
24    increasing or calculating any benefit.
25        (k)  In the case of a member who has at least 10 years of
26    creditable  service  as  a  court  reporter,  the  retirement
27    annuity  for  service  as  a  court reporter shall be 2.2% of
28    final average compensation for each year of such service as a
29    noncovered employee, and 1.5% of final  average  compensation
30    for each year of such service as a covered employee.
31    (Source: P.A. 86-272; 86-273; 86-1028.)
32        (Text of Section after amendment by P.A. 89-507)
33        Sec. 14-108.  Amount of retirement annuity.  A member who
34    has  contributed  to the System for at least 12 months, shall
                            -5-                LRB9000557EGfg
 1    be entitled to a prior  service  annuity  for  each  year  of
 2    certified prior service credited to him, except that a member
 3    shall  receive 1/3 of the prior service annuity for each year
 4    of service for which contributions have been made and all  of
 5    such  annuity  shall  be  payable  after  the member has made
 6    contributions for a period of 3 years.  Proportionate amounts
 7    shall be payable for service of less than a full  year  after
 8    completion of at least 12 months.
 9        The   total   period  of  service  to  be  considered  in
10    establishing the  measure  of  prior  service  annuity  shall
11    include  service  credited in the Teachers' Retirement System
12    of  the  State  of  Illinois  and  the   State   Universities
13    Retirement  System  for which contributions have been made by
14    the member to such systems; provided that at least 1 year  of
15    the total period of 3 years prescribed for the allowance of a
16    full  measure  of  prior  service  annuity  shall  consist of
17    membership service in this system for which credit  has  been
18    granted.
19        (a)  In  the  case of a member who retires after December
20    31, 1997 and is a noncovered employee, the retirement annuity
21    for membership service and prior service shall be 2.2%  1.67%
22    of  final average compensation for each of the first 10 years
23    of service; 1.90% for each of the next 10 years  of  service;
24    2.10%  for  each  year  of  service  in  excess of 20 but not
25    exceeding 30; and 2.30% for each year in excess of  30.   Any
26    service  credit  established  as  a covered employee shall be
27    considered in  determining  the  applicable  percentages  and
28    computed as stated in paragraph (b).
29        (b)  In  the case of a member who retires  after December
30    31, 1997 and is a covered employee,  the  retirement  annuity
31    for membership service and prior service shall be computed as
32    stated in paragraph (a) for all service credit established as
33    a  noncovered  employee;  for service credit established as a
34    covered  employee  it  shall  be  1.67%  of   final   average
                            -6-                LRB9000557EGfg
 1    compensation  1%  for  each of the first 10 years of service;
 2    1.10% for each of the next 10 years  of  service;  1.30%  for
 3    each  year  of  service in excess of 20 but not exceeding 30;
 4    and 1.50% for each year of service  in  excess  of  30.   Any
 5    service  credit established as a noncovered employee shall be
 6    considered in determining the applicable percentages.
 7        (c)  For a member with 30  but  less  than  35  years  of
 8    creditable service retiring after attaining age 55 but before
 9    age  60, the retirement annuity shall be reduced by 1/2 of 1%
10    for each month that the member's age is under age 60  at  the
11    time of retirement.
12        (d)  A  retirement  annuity shall not exceed 75% of final
13    average compensation, subject to such extension as may result
14    from the application of Section 14-114 or Section 14-115.
15        (e)  The  retirement  annuity  payable  to  any   covered
16    employee  who  is  a  member  of the System and in service on
17    January 1, 1969, or in service thereafter in 1969 as a result
18    of legislation  enacted  by  the  Illinois  General  Assembly
19    transferring  the  member  to  State  employment  from county
20    employment in a county Department of Public Aid  in  counties
21    of 3,000,000 or more population, under a plan of coordination
22    with   the  Old  Age,  Survivors  and  Disability  provisions
23    thereof, if not fully insured for Old Age Insurance  payments
24    under the Federal Old Age, Survivors and Disability Insurance
25    provisions at the date of acceptance of a retirement annuity,
26    shall  not be less than the amount for which the member would
27    have been eligible if coordination were not applicable.
28        (f)  The  retirement  annuity  payable  to  any   covered
29    employee  who  is  a  member  of the System and in service on
30    January 1, 1969, or in service thereafter in 1969 as a result
31    of the legislation designated in  the  immediately  preceding
32    paragraph,  if  fully  insured for Old Age Insurance payments
33    under  the  Federal  Social  Security  Act  at  the  date  of
34    acceptance of a retirement annuity, shall not be less than an
                            -7-                LRB9000557EGfg
 1    amount which when added  to  the  Primary  Insurance  Benefit
 2    payable  to  the  member upon attainment of age 65 under such
 3    Federal Act, will equal the annuity which would otherwise  be
 4    payable   if  the  coordinated  plan  of  coverage  were  not
 5    applicable.
 6        (g)  In the case of a member who retires  after  December
 7    31, 1997 and is a noncovered employee, the retirement annuity
 8    for  membership  service  as a full-time security employee of
 9    the Department of Corrections or  security  employee  of  the
10    Department  of  Human  Services  shall be 2.25% 1.9% of final
11    average compensation for each of the first  30  10  years  of
12    service; 2.1% for each of the next 10 years of service; 2.25%
13    for  each  year  of service in excess of 20 but not exceeding
14    30; and 2.5% for each year in excess of 30.
15        (h)  In the case of a member who is a  covered  employee,
16    the  retirement annuity for membership service as a full-time
17    security  employee  of  the  Department  of  Corrections   or
18    security  employee  of the Department of Human Services shall
19    be 1.67% of final average compensation for each of the  first
20    10  years  of service; 1.90% for each of the next 10 years of
21    service; 2.10% for each year of service in excess of  20  but
22    not exceeding 30; and 2.30% for each year in excess of 30.
23        (i)  For  the purposes of this Section and Section 14-133
24    of this Act, the term "security employee of the Department of
25    Corrections"  and  the  term  "security   employee   of   the
26    Department   of  Human  Services"  shall  have  the  meanings
27    ascribed to them in subsection (c) of Section 14-110.
28        (j)  The  retirement   annuity   computed   pursuant   to
29    paragraphs  (g)  or  (h)  shall  be  applicable only to those
30    security employees  of  the  Department  of  Corrections  and
31    security  employees  of  the Department of Human Services who
32    have at least 20 years of membership service and who are  not
33    eligible  for  the  alternative  retirement  annuity provided
34    under Section 14-110.  However, persons transferring to  this
                            -8-                LRB9000557EGfg
 1    System  under  Section 14-108.2 who have service credit under
 2    Article 16  of  this  Code  may  count  such  service  toward
 3    establishing  their  eligibility  under  the  20-year service
 4    requirement of this subsection; but such service may be  used
 5    only  for  establishing  such  eligibility,  and  not for the
 6    purpose of increasing or calculating any benefit.
 7        (k)  In the case of a member who has at least 10 years of
 8    creditable  service  as  a  court  reporter,  the  retirement
 9    annuity for service as a court  reporter  shall  be  2.2%  of
10    final average compensation for each year of such service as a
11    noncovered  employee,  and 1.5% of final average compensation
12    for each year of such service as a covered employee.
13    (Source: P.A. 89-507, eff. 7-1-97.)
14        (40 ILCS 5/15-136) (from Ch. 108 1/2, par. 15-136)
15        Sec. 15-136.  Retirement annuities - Amount.
16        (a)  The  amount  of  the  retirement  annuity  shall  be
17    determined by whichever of the following rules is  applicable
18    and provides the largest annuity:
19        Rule  1:  The  retirement annuity shall be 1.67% of final
20    rate of earnings for each of the first 10 years  of  service,
21    1.90%  for  each  of  the next 10 years of service, 2.10% for
22    each year of service in excess of 20 but  not  exceeding  30,
23    and  2.30%  for each year in excess of 30; or for persons who
24    retire after December 31, 1997, 2.2% of  the  final  rate  of
25    earnings for each year of service.
26        Rule  2:  The  retirement annuity shall be the sum of the
27    following,  determined   from   amounts   credited   to   the
28    participant  in  accordance with the actuarial tables and the
29    prescribed rate  of  interest  in  effect  at  the  time  the
30    retirement annuity begins:
31             (i)  The  normal annuity which can be provided on an
32        actuarial equivalent basis,  by  the  accumulated  normal
33        contributions as of the date the annuity begins; and
                            -9-                LRB9000557EGfg
 1             (ii)  an  annuity  from employer contributions of an
 2        amount which can be provided on an actuarially equivalent
 3        basis from the accumulated normal contributions  made  by
 4        the   participant  under  Section  15-113.6  and  Section
 5        15-113.7 plus 1.4  times  all  other  accumulated  normal
 6        contributions made by the participant.
 7        Rule  3:  The  retirement annuity of a participant who is
 8    employed at least one-half time during the  period  on  which
 9    his or her final rate of earnings is based, shall be equal to
10    the   participant's  years  of  service  not  to  exceed  30,
11    multiplied by (1) $96 if  the  participant's  final  rate  of
12    earnings  is  less than $3,500, (2) $108 if the final rate of
13    earnings is at least $3,500 but less than $4,500, (3) $120 if
14    the final rate of earnings is at least $4,500 but  less  than
15    $5,500,  (4)  $132  if the final rate of earnings is at least
16    $5,500 but less than $6,500, (5) $144 if the  final  rate  of
17    earnings is at least $6,500 but less than $7,500, (6) $156 if
18    the  final  rate of earnings is at least $7,500 but less than
19    $8,500, (7) $168 if the final rate of earnings  is  at  least
20    $8,500  but  less than $9,500, and (8) $180 if the final rate
21    of earnings is $9,500 or more.
22        Rule 4:  A participant who is at least age 50 and has  25
23    or  more years of service as a police officer or firefighter,
24    and a participant who is age 55 or over and has at  least  20
25    but  less  than  25  years  of service as a police officer or
26    firefighter, shall be entitled to a retirement annuity  of  2
27    1/4%  of  the final rate of earnings for each of the first 10
28    years of service as a police officer or firefighter,  2  1/2%
29    for  each of the next 10 years of service as a police officer
30    or firefighter, and 2 3/4% for each  year  of  service  as  a
31    police   officer   or  firefighter  in  excess  of  20.   The
32    retirement annuity for all other service  shall  be  computed
33    under Rule 1.
34        (b)  The  retirement annuity provided under Rules 1 and 3
                            -10-               LRB9000557EGfg
 1    above shall be reduced by  1/2  of  1%  for  each  month  the
 2    participant  is  under  age  60  at  the  time of retirement.
 3    However, this reduction shall  not  apply  in  the  following
 4    cases:
 5             (1)  For  a  disabled  participant  whose disability
 6        benefits have been discontinued because  he  or  she  has
 7        exhausted   eligibility  for  disability  benefits  under
 8        clause (6) (5) of Section 15-152;
 9             (2)  For a participant who has at least 35 years  of
10        service; or
11             (3)  For  that portion of a retirement annuity which
12        has  been  provided  on  account  of   service   of   the
13        participant  during  periods when he or she performed the
14        duties of a  police  officer  or  firefighter,  if  these
15        duties  were  performed  for at least 5 years immediately
16        preceding the date the retirement annuity is to begin.
17        (c)  The maximum retirement annuity provided under  Rules
18    1,  2,  and  4 shall be the lesser of (1) the annual limit of
19    benefits as specified in Section 415 of the Internal  Revenue
20    Code  of  1986,  as  such Section may be amended from time to
21    time and as such benefit limits  shall  be  adjusted  by  the
22    Commissioner  of  Internal Revenue, and (2) 75% of final rate
23    of earnings; however, this limitation of 75% of final rate of
24    earnings shall not apply to a person who is a participant  or
25    annuitant on September 15, 1977 if it results in a retirement
26    annuity  less  than that which is payable to the annuitant or
27    which would have been payable to the  participant  under  the
28    provisions of this Article in effect on June 30, 1977.
29        (d)  An  annuitant whose status as an employee terminates
30    after August 14, 1969 shall receive  automatic  increases  in
31    his or her retirement annuity as follows:
32        Effective  January  1  immediately following the date the
33    retirement annuity begins, the  annuitant  shall  receive  an
34    increase  in  his or her monthly retirement annuity of 0.125%
                            -11-               LRB9000557EGfg
 1    of the monthly retirement annuity provided under Rule 1, Rule
 2    2, Rule 3, or Rule 4, contained in this  Section,  multiplied
 3    by  the number of full months which elapsed from the date the
 4    retirement annuity payments began to January  1,  1972,  plus
 5    0.1667%  of  such  annuity,  multiplied by the number of full
 6    months which elapsed from January 1, 1972, or  the  date  the
 7    retirement  annuity  payments  began,  whichever is later, to
 8    January 1, 1978, plus 0.25% of such annuity multiplied by the
 9    number of full months which elapsed from January 1, 1978,  or
10    the  date the retirement annuity payments began, whichever is
11    later, to the effective date of the increase.
12        The annuitant shall receive an increase  in  his  or  her
13    monthly  retirement  annuity  on  each  January  1 thereafter
14    during the annuitant's life of  3%  of  the  monthly  annuity
15    provided under Rule 1, Rule 2, Rule 3, or Rule 4 contained in
16    this  Section.  The change made under this subsection by P.A.
17    81-970 is effective January  1,  1980  and  applies  to  each
18    annuitant  whose  status  as an employee terminates before or
19    after that date.
20        Beginning January 1, 1990, all automatic annual increases
21    payable  under  this  Section  shall  be  calculated   as   a
22    percentage  of  the  total annuity payable at the time of the
23    increase, including all increases  previously  granted  under
24    this Article.      The change made in this subsection by P.A.
25    85-1008  is  effective  January  26,  1988, and is applicable
26    without regard to whether status as  an  employee  terminated
27    before that date.
28        (e)  If,  on  January 1, 1987, or the date the retirement
29    annuity payment period begins, whichever is later, the sum of
30    the retirement annuity provided under Rule 1  or  Rule  2  of
31    this  Section  and  the  automatic  annual increases provided
32    under the preceding subsection or Section  15-136.1,  amounts
33    to  less  than the retirement annuity which would be provided
34    by Rule 3, the retirement annuity shall be  increased  as  of
                            -12-               LRB9000557EGfg
 1    January  1,  1987, or the date the retirement annuity payment
 2    period begins, whichever is later, to the amount which  would
 3    be  provided by Rule 3 of this Section. Such increased amount
 4    shall be considered as the retirement annuity in  determining
 5    benefits provided under other Sections of this Article.  This
 6    paragraph  applies  without  regard  to  whether status as an
 7    employee  terminated  before  the  effective  date  of   this
 8    amendatory  Act  of  1987,  provided  that  the annuitant was
 9    employed at least one-half time during the  period  on  which
10    the final rate of earnings was based.
11        (f)  A participant is entitled to such additional annuity
12    as  may  be provided on an actuarial equivalent basis, by any
13    accumulated additional contributions to his  or  her  credit.
14    However, the additional contributions made by the participant
15    toward the automatic increases in annuity provided under this
16    Section  shall  not  be taken into account in determining the
17    amount of such additional annuity.
18        (g)  If, (1) by law, a function of a  governmental  unit,
19    as  defined by Section 20-107 of this Code, is transferred in
20    whole or in part  to  an  employer,  and  (2)  a  participant
21    transfers  employment  from  such  governmental  unit to such
22    employer within 6 months after the transfer of the  function,
23    and (3) the sum of (A) the annuity payable to the participant
24    under  Rule  1,  2, or 3 of this Section (B) all proportional
25    annuities payable to the participant by all other  retirement
26    systems  covered  by  Article 20, and (C) the initial primary
27    insurance amount to which the participant is  entitled  under
28    the  Social Security Act, is less than the retirement annuity
29    which would have been payable if  all  of  the  participant's
30    pension  credits  validated  under  Section  20-109  had been
31    validated under this system, a supplemental annuity equal  to
32    the  difference  in  such  amounts  shall  be  payable to the
33    participant.
34        (h)  On January 1, 1981, an annuitant who was receiving a
                            -13-               LRB9000557EGfg
 1    retirement annuity on or before January 1,  1971  shall  have
 2    his  or  her  retirement annuity then being paid increased $1
 3    per month for each year of creditable service. On January  1,
 4    1982,  an  annuitant  whose  retirement  annuity  began on or
 5    before January 1, 1977, shall  have  his  or  her  retirement
 6    annuity  then being paid increased $1 per month for each year
 7    of creditable service.
 8        (i)  On January 1, 1987, any annuitant  whose  retirement
 9    annuity  began  on  or before January 1, 1977, shall have the
10    monthly retirement annuity increased by an amount equal to 8¢
11    per year of creditable service times the number of years that
12    have elapsed since the annuity began.
13    (Source: P.A. 86-272; 86-273; 86-1028; revised 5-17-96.)
14        (40 ILCS 5/16-133) (from Ch. 108 1/2, par. 16-133)
15        Sec. 16-133.  Retirement annuity; amount.
16        (a)  The amount of the retirement annuity  shall  be  the
17    larger of the amounts determined under paragraphs (A) and (B)
18    below:
19             (A)  An   amount   consisting  of  the  sum  of  the
20        following:
21                  (1)  An amount  that  can  be  provided  on  an
22             actuarially   equivalent   basis   by  the  member's
23             accumulated contributions at the time of retirement;
24             and
25                  (2)  The sum of (i)  the  amount  that  can  be
26             provided  on  an actuarially equivalent basis by the
27             member's  accumulated   contributions   representing
28             service  prior  to July 1, 1947, and (ii) the amount
29             that can be provided on  an  actuarially  equivalent
30             basis  by  the  amount  obtained  by multiplying 1.4
31             times   the   member's   accumulated   contributions
32             covering service subsequent to June 30, 1947; and
33                  (3)  If there is prior  service,  2  times  the
                            -14-               LRB9000557EGfg
 1             amount   that   would  have  been  determined  under
 2             subparagraph (2) of paragraph (A) above  on  account
 3             of  contributions  which would have been made during
 4             the period of prior service creditable to the member
 5             had the System been in operation and had the  member
 6             made  contributions  at  the  contribution  rate  in
 7             effect prior to July 1, 1947.
 8             (B)  An amount consisting of the greatest greater of
 9        the following:
10                  (1)  1.67%  of final average salary for each of
11             the first 10 years of creditable service,  l.90%  of
12             final  average  salary for each year in excess of 10
13             but not exceeding 20, 2.10% of final average  salary
14             for  each year in excess of 20 but not exceeding 30,
15             and 2.30% of final average salary for each  year  in
16             excess of 30; and
17                  (2)  for  persons who retire after December 31,
18             1997, 2.2% of final average salary for each year  of
19             service;
20                  (3)  1  1/2%  of  final average salary for each
21             year of creditable service plus the  sum  $7.50  for
22             each of the first 20 years of creditable service.
23             The  amount  of  the  retirement  annuity determined
24        under this paragraph (B) shall be reduced by  1/2  of  1%
25        for each month that the member is less than age 60 at the
26        time   the  retirement  annuity  begins.   However,  this
27        reduction shall not apply (i) if the member has at  least
28        35  years  of  creditable  service, or (ii) if the member
29        retires on account of disability under  Section  16-149.2
30        of  this  Article  with  at  least 20 years of creditable
31        service.
32        (b)  For purposes of this Section, final  average  salary
33    shall  be  the  average  salary for the highest 4 consecutive
34    years within the last  10  years  of  creditable  service  as
                            -15-               LRB9000557EGfg
 1    determined  under  rules  of  the  board.   The minimum final
 2    average salary shall be considered to be $2,400 per year.
 3        In the determination of final average salary for  members
 4    other  than  elected officials and their appointees when such
 5    appointees are allowed by statute, that part  of  a  member's
 6    salary  for  any  year  beginning  after  June 30, 1979 which
 7    exceeds the member's annual full-time salary  rate  with  the
 8    same  employer  for the preceding year by more than 20% shall
 9    be excluded.
10        (c)  In determining the amount of the retirement  annuity
11    under  paragraph (B) of this Section, a fractional year shall
12    be granted proportional credit.
13        (d)  The retirement annuity  determined  under  paragraph
14    (B)  of  this  Section shall be available only to members who
15    render teaching service after July 1, 1947 for  which  member
16    contributions  are  required,  and to annuitants who re-enter
17    under the provisions of Section 16-150.
18        (e)  The  maximum  retirement  annuity   provided   under
19    paragraph  (B)  of this Section shall be 75% of final average
20    salary.
21    (Source: P.A. 86-273; 87-794; 87-1265.)
22        (40 ILCS 5/17-116) (from Ch. 108 1/2, par. 17-116)
23        Sec. 17-116. Service  retirement  pension.  Each  teacher
24    having  20 years of service upon attainment of age 55, or who
25    thereafter attains age 55 shall  be  entitled  to  a  service
26    retirement  pension  upon  or after attainment of age 55; and
27    each teacher in service on or after July 1, 1971, with  5  or
28    more  but  less than 20 years of service shall be entitled to
29    receive a service retirement pension upon or after attainment
30    of age 62.  Such pension is to be calculated as follows:
31        Beginning as of June 25,  1971,  the  service  retirement
32    pension  for  a teacher who retires on or after such date but
33    before January 1, 1998, at age 60 or over, shall be 1.67% for
                            -16-               LRB9000557EGfg
 1    each of the first 10 years of service; 1.90% for each of  the
 2    next  10  years of service; 2.10% for each year of service in
 3    excess of 20 but not exceeding 30; and 2.30% for each year of
 4    service in excess of 30, based upon average salary as  herein
 5    defined.   The  service  retirement pension for a teacher who
 6    retires after December 31, 1997 at age 60 or  over  shall  be
 7    2.2% of average salary for each year of service.
 8        When  computing  such  service  retirement  pensions, the
 9    following conditions shall apply:
10        1.  Average salary shall consist of  the  average  annual
11    rate  of  salary  for  the  4  consecutive years of validated
12    service within the last 10 years of service when such average
13    annual rate was highest.  In  the  determination  of  average
14    salary  for  retirement  allowance  purposes, for members who
15    commenced employment after August 31, 1979, that part of  the
16    salary  for  any  year  shall  be  excluded which exceeds the
17    annual full-time salary rate for the preceding year  by  more
18    than  20%.   In the case of a member who commenced employment
19    before August 31, 1979 and who  receives  salary  during  any
20    year  after  September  1, 1983 which exceeds the annual full
21    time salary rate for the preceding year by more than 20%, the
22    Board of Education or employer  shall  pay  to  the  Fund  an
23    amount  equal  to the present value of the additional service
24    retirement pension resulting from such excess  salary.    The
25    present  value  of  the additional service retirement pension
26    shall be computed by the Board  on  the  basis  of  actuarial
27    tables adopted by the Board.  If a member elects to receive a
28    pension from this fund provided by Section 20-121, his salary
29    under  the  State  Universities  Retirement  System  and  the
30    Teachers' Retirement System of the State of Illinois shall be
31    considered  in determining such average salary.  Amounts paid
32    after the effective date of this amendatory Act of  1991  for
33    unused  vacation  time earned after that effective date shall
34    not under any circumstances be included in the calculation of
                            -17-               LRB9000557EGfg
 1    average salary or the annual rate of salary for the  purposes
 2    of this Article.
 3        2.  Proportionate  credit  shall  be  given for validated
 4    service of less than one year.
 5        3.  For retirement at age 60 or over the pension shall be
 6    payable at the full rate.
 7        4.  For separation from service below age 60 to a minimum
 8    age of 55, the pension shall be discounted  at  the  rate  of
 9    1/2  of  one  per  cent  for  each  month that the age of the
10    contributor is less than 60, but a teacher may elect to defer
11    the effective date of pension in order to eliminate or reduce
12    this discount. This discount shall not be applicable  to  any
13    participant  who has at least 35 years of service on the date
14    the retirement annuity begins.
15        5.  No additional pension shall be  granted  for  service
16    exceeding  45 years. Beginning June 26, 1971 no pension shall
17    exceed the greater of $1,500 per  month  or  75%  of  average
18    salary as herein defined.
19        6.  Service   retirement  pensions  shall  begin  on  the
20    effective date of resignation, retirement, the day  following
21    the  close of the payroll period for which service credit was
22    validated, or the  time  the  person  resigning  or  retiring
23    attains  age  55,  or  on  a  date  elected  by  the teacher,
24    whichever shall be latest.
25    (Source: P.A. 86-1488.)
26        Section 90.  The State Mandates Act is amended by  adding
27    Section 8.21 as follows:
28        (30 ILCS 805/8.21 new)
29        Sec.  8.21.  Exempt  mandate.  Notwithstanding Sections 6
30    and 8 of this Act, no reimbursement by the State is  required
31    for  the  implementation  of  any  mandate  created  by  this
32    amendatory Act of 1997.
                            -18-               LRB9000557EGfg
 1        Section  95.   No  acceleration or delay.  Where this Act
 2    makes changes in a statute that is represented in this Act by
 3    text that is not yet or no longer in effect (for  example,  a
 4    Section  represented  by  multiple versions), the use of that
 5    text does not accelerate or delay the taking  effect  of  (i)
 6    the  changes made by this Act or (ii) provisions derived from
 7    any other Public Act.
 8        Section 99. Effective date.  This Act takes  effect  upon
 9    becoming law.

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