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90_HB2761
40 ILCS 5/7-142 from Ch. 108 1/2, par. 7-142
40 ILCS 5/7-144.2 from Ch. 108 1/2, par. 7-144.2
40 ILCS 5/7-152 from Ch. 108 1/2, par. 7-152
40 ILCS 5/7-156 from Ch. 108 1/2, par. 7-156
30 ILCS 805/8.22 new
Amends the IMRF Article of the Pension Code to compound
the automatic annual increase in retirement, incremental,
disability, and survivor annuities. Amends the State
Mandates Act to require implementation without reimbursement.
Effective immediately.
LRB9010345EGfg
LRB9010345EGfg
1 AN ACT to amend the Illinois Pension Code by changing
2 Sections 7-142, 7-144.2, 7-152, and 7-156 and to amend the
3 State 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 7-142, 7-144.2, 7-152, and 7-156 as
8 follows:
9 (40 ILCS 5/7-142) (from Ch. 108 1/2, par. 7-142)
10 Sec. 7-142. Retirement annuities - Amount.
11 (a) The amount of a retirement annuity shall be the sum
12 of the following, determined in accordance with the actuarial
13 tables in effect at the time of the grant of the annuity:
14 1. For employees with 8 or more years of service,
15 an annuity computed pursuant to subparagraphs a or b of
16 this subparagraph 1, whichever is the higher, and for
17 employees with less than 8 years of service the annuity
18 computed pursuant to subparagraph a:
19 a. The monthly annuity which can be provided
20 from the total accumulated normal, municipality and
21 prior service credits, as of the attained age of the
22 employee on the date the annuity begins provided
23 that such annuity shall not exceed 75% of the final
24 rate of earnings of the employee.
25 b. (i) The monthly annuity amount determined
26 as follows by multiplying (a) 1 2/3% for annuitants
27 with not more than 15 years or (b) 1 2/3% for the
28 first 15 years and 2% for each year in excess of 15
29 years for annuitants with more than 15 years by the
30 number of years plus fractional years, prorated on a
31 basis of months, of creditable service and multiply
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1 the product thereof by the employee's final rate of
2 earnings.
3 (ii) For the sole purpose of computing the
4 formula (and not for the purposes of the limitations
5 hereinafter stated) $125 shall be considered the
6 final rate of earnings in all cases where the final
7 rate of earnings is less than such amount.
8 (iii) The monthly annuity computed in
9 accordance with this subparagraph b, shall not
10 exceed an amount equal to 75% of the final rate of
11 earnings.
12 (iv) For employees who who have less than 35
13 years of service, the annuity computed in accordance
14 with this subparagraph b (as reduced by application
15 of subparagraph (iii) above) shall be reduced by
16 0.25% thereof (0.5% if service was terminated before
17 January 1, 1988) for each month or fraction thereof
18 (1) that the employee's age is less than 60 years,
19 or (2) if the employee has at least 30 years of
20 service credit, that the employee's service credit
21 is less than 35 years, whichever is less, on the
22 date the annuity begins.
23 2. The annuity which can be provided from the total
24 accumulated additional credits as of the attained age of
25 the employee on the date the annuity begins.
26 (b) If payment of an annuity begins prior to the
27 earliest age at which the employee will become eligible for
28 an old age insurance benefit under the federal Social
29 Security Act, he may elect that the annuity payments from
30 this Fund shall exceed those payable after his attaining such
31 age by an amount, computed as determined by rules of the
32 Board, but not in excess of his estimated Social Security
33 Benefit, determined as of the effective date of the annuity,
34 provided that in no case shall the total annuity payments
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1 made by this fund exceed in actuarial value the annuity which
2 would have been payable had no such election been made.
3 (c) The retirement annuity shall be increased each year
4 by 2%, not compounded, of the monthly amount of annuity,
5 taking into consideration any adjustment under paragraph (b)
6 of this Section. This increase shall be effective each
7 January 1 and computed from the effective date of the
8 retirement annuity, the first increase being .167% of the
9 monthly amount times the number of months from the effective
10 date to January 1. Beginning January 1, 1984 and until
11 January 1, 1999 thereafter, the retirement annuity shall be
12 increased by 3% each year, not compounded. Beginning January
13 1, 1999, all increases under this subsection following the
14 initial increase shall be at the rate of 3% of the currently
15 payable monthly annuity, including any increases previously
16 granted under this Article. The change in this subsection
17 made by this amendatory Act of 1998 is not limited to persons
18 in service on or after the effective date of this amendatory
19 Act.
20 This increase shall not be applicable to annuitants who
21 are not in service on or after September 8, 1971.
22 (Source: P.A. 87-850.)
23 (40 ILCS 5/7-144.2) (from Ch. 108 1/2, par. 7-144.2)
24 Sec. 7-144.2. Incremental retirement annuity. Each
25 employee annuitant who terminated service prior to the
26 effective date of this amendatory Act of 1971 is entitled to
27 receive a monthly incremental retirement annuity, effective
28 January 1, 1972, of .167% of his monthly retirement annuity
29 amount, multiplied by the number of months from the effective
30 date of his annuity to January 1, 1972. This monthly
31 incremental annuity shall be increased on each January 1
32 thereafter during the lifetime of the annuitant by 2% of the
33 monthly retirement annuity amount. Beginning January 1, 1984
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1 and each January 1 thereafter, the monthly incremental
2 annuity shall be increased by 3% of the monthly retirement
3 annuity amount.
4 The incremental annuity is payable only if the annuitant
5 agrees to pay the fund an amount equal to 1% of 1/12 of his
6 annual final rate of earnings, determined as of the date of
7 his retirement, multiplied by the number of full years of
8 service. The annuitant, prior to December 1, 1971, may
9 authorize the fund to deduct the payment from his annuity if
10 the total payment can be deducted in one month. If the
11 agreement or payment is received by the fund prior to
12 December 1, 1971, the incremental annuity shall be effective
13 January 1, 1972. If the agreement or payment is not received
14 before December 1, 1971, the incremental annuity shall be
15 effective the first day of the next month after receipt of
16 payment by the fund, but if received after the 15th day, the
17 first day of the month following the next month, and shall
18 not be paid retroactively.
19 Until January 1, 1999, the monthly retirement annuity
20 amount, for the purpose of this Section, shall be the annuity
21 amount initially awarded or, if adjusted under paragraph (b)
22 of Section 7-142, the adjusted amount, disregarding any
23 incremental annuities previously granted. Beginning January
24 1, 1999, the monthly retirement annuity amount, for the
25 purpose of this Section, shall be the currently payable
26 annuity amount, including any adjustments under paragraph (b)
27 of Section 7-142 and any incremental annuities previously
28 granted. The change in this Section made by this amendatory
29 Act of 1998 is not limited to persons in service on or after
30 the effective date of this amendatory Act.
31 (Source: P.A. 83-664.)
32 (40 ILCS 5/7-152) (from Ch. 108 1/2, par. 7-152)
33 Sec. 7-152. Disability benefits - Amount. The amount of
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1 the monthly temporary and total and permanent disability
2 benefits shall be 50% of the participating employee's final
3 rate of earnings on the date disability was incurred, subject
4 to the following adjustments:
5 (a) If the participating employee has a reduced rate of
6 earnings at the time his employment ceases because of
7 disability, the rate of earnings shall be computed on the
8 basis of his last 12 month period of full-time employment.
9 (b) If the participating employee is eligible for a
10 disability benefit under the federal Social Security Act, the
11 amount of monthly disability benefits shall be reduced, but
12 not to less than $10 a month, by the amount he would be
13 eligible to receive as a disability benefit under the federal
14 Social Security Act, whether or not because of service as a
15 covered employee under this Article. The reduction shall be
16 effective as of the month the employee is eligible for Social
17 Security disability benefits. The Board may make such
18 reduction if it appears that the employee may be so eligible
19 pending determination of eligibility and make an appropriate
20 adjustment if necessary after such determination. If the
21 employee, because of his refusal to accept rehabilitation
22 services under the federal Rehabilitation Act of 1973 or the
23 federal Social Security Act, or because he is receiving
24 workers' compensation benefits, has his Social Security
25 benefits reduced or terminated, the disability benefit shall
26 be reduced as if the employee were receiving his full Social
27 Security disability benefit.
28 (c) If the employee is over age 65, was not eligible for
29 a Social Security benefit immediately before reaching age 65
30 and is eligible for a Social Security old-age insurance
31 benefit, the amount of the monthly disability benefit shall
32 be reduced, but not to less than $10 a month, by the amount
33 of the old-age insurance benefit to which the employee is
34 entitled whether or not the employee applies for the Social
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1 Security old-age insurance benefit. This reduction shall be
2 made in the month after the month in which the employee
3 attains age 65. However, if the employee was receiving a
4 Social Security disability benefit before reaching age 65,
5 the disability benefits after age 65 shall be determined
6 under subsection (b) of this Section.
7 (d) The amount of disability benefits shall not be
8 reduced by reason of any increase, other than one resulting
9 from a correction in the employee's wage records, in the
10 amount of disability or old-age insurance benefits under the
11 Federal Social Security Act which takes effect after the
12 month of the initial reduction under paragraph (b) or (c) of
13 this Section.
14 (e) If the employee in any month receives compensation
15 from gainful employment which is more than 25% of the final
16 rate of earnings on which his disability benefits are based,
17 the temporary disability benefit payable for that month shall
18 be reduced by an amount equal to such excess.
19 (f) An employee who has been disabled for at least 30
20 days may return to work for the employer on a part-time basis
21 for a trial work period of up to one year, during which the
22 disability shall be deemed to continue. Service credit shall
23 continue to accrue and the disability benefit shall continue
24 to be paid during the trial work period, but the benefit
25 shall be reduced by the amount of earnings received by the
26 disabled employee. Return to service on a full-time basis
27 shall terminate the trial work period. The reduction under
28 this subsection (f) shall be in lieu of the reduction, if
29 any, required under subsection (e).
30 (g) Beginning January 1, 1988, every total and permanent
31 disability benefit shall be increased by 3% of the original
32 amount of the benefit, not compounded, on each January 1
33 following the later of (1) the date the total and permanent
34 disability benefit begins, or (2) the date the total and
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1 permanent disability benefit would have begun if the employee
2 had been paid a temporary disability benefit for 30 months.
3 Beginning January 1, 1999, all increases under this
4 subsection following the initial increase shall be at the
5 rate of 3% of the currently payable monthly annuity,
6 including any increases previously granted under this
7 Article. The change in this subsection made by this
8 amendatory Act of 1998 is not limited to persons in service
9 on or after the effective date of this amendatory Act.
10 (Source: P.A. 87-740.)
11 (40 ILCS 5/7-156) (from Ch. 108 1/2, par. 7-156)
12 Sec. 7-156. Surviving spouse annuities - amount.
13 (a) The amount of surviving spouse annuity shall be:
14 1. Upon the death of an employee annuitant or such
15 person entitled, upon application, to a retirement annuity at
16 date of death, (i) an amount equal to 1/2 of the retirement
17 annuity which was or would have been payable exclusive of the
18 amount so payable which was provided from additional credits,
19 and disregarding any election made under paragraph (b) of
20 Section 7-142, plus (ii) an annuity which could be provided
21 at the then attained age of the surviving spouse and under
22 actuarial tables then in effect, from the excess of the
23 additional credits, (excluding any such credits used to
24 create a reversionary annuity) used to provide the annuity
25 granted pursuant to paragraph (a) (2) of Section 7-142 of
26 this article over the total annuity payments made pursuant
27 thereto.
28 2. Upon the death of a participating employee on or
29 after attainment of age 55, an amount equal to 1/2 of the
30 retirement annuity which he could have had as of the date of
31 death had he then retired and applied for annuity, exclusive
32 of the portion thereof which could have been provided from
33 additional credits, and disregarding paragraph (b) of Section
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1 7-142, plus an amount equal to the annuity which could be
2 provided from the total of his accumulated additional credits
3 at date of death, on the basis of the attained age of the
4 surviving spouse on such date.
5 3. Upon the death of a participating employee before age
6 55, an amount equal to 1/2 of the retirement annuity which he
7 could have had as of his attained age on the date of death,
8 had he then retired and applied for annuity, and the
9 provisions of this Article that no such annuity shall begin
10 until the employee has attained at least age 55 were not
11 applicable, exclusive of the portion thereof which could have
12 been provided from additional credits and disregarding
13 paragraph (b) of Section 7-142, plus an amount equal to the
14 annuity which could be provided from the total of his
15 accumulated additional credits at date of death, on the basis
16 of the attained age of the surviving spouse on such date.
17 If a surviving spouse is more than 5 years younger than
18 the deceased, that portion of the annuity which is not based
19 on additional credits shall be reduced in the ratio of the
20 value of a life annuity of $1 per year at an age of 5 years
21 less than the attained age of the deceased, at the earlier of
22 the date of the death or the date his retirement annuity
23 begins, to the value of a life annuity of $1 per year at the
24 attained age of the surviving spouse on such date, according
25 to actuarial tables approved by the Board.
26 In computing the amount of a surviving spouse annuity,
27 incremental increases of retirement annuities to the date of
28 death of the employee annuitant shall be considered.
29 (b) Each surviving spouse annuity payable on January 1,
30 1988 shall be increased on that date by 3% of the original
31 amount of the annuity. Each surviving spouse annuity that
32 begins after January 1, 1988 shall be increased on the
33 January 1 next occurring after the annuity begins, by an
34 amount equal to (i) 3% of the original amount thereof if the
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1 deceased employee was receiving a retirement annuity at the
2 time of his death; otherwise (ii) 0.167% of the original
3 amount thereof for each complete month which has elapsed
4 since the date the annuity began.
5 On each January 1 after the date of the initial increase
6 under this subsection, each surviving spouse annuity shall be
7 increased by 3% of the originally granted amount of the
8 annuity. However, beginning January 1, 1999, all increases
9 under this subsection following the initial increase shall be
10 at the rate of 3% of the currently payable monthly annuity,
11 including any increases previously granted under this
12 Article. The change in this subsection made by this
13 amendatory Act of 1998 is not limited to survivors of persons
14 in service on or after the effective date of this amendatory
15 Act.
16 (Source: P.A. 85-941.)
17 Section 90. The State Mandates Act is amended by adding
18 Section 8.22 as follows:
19 (30 ILCS 805/8.22 new)
20 Sec. 8.22. Exempt mandate. Notwithstanding Sections 6
21 and 8 of this Act, no reimbursement by the State is required
22 for the implementation of any mandate created by this
23 amendatory Act of 1998.
24 Section 99. Effective date. This Act takes effect upon
25 becoming law.