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90_SB1301
40 ILCS 5/15-136 from Ch. 108 1/2, par. 15-136
40 ILCS 5/15-154 from Ch. 108 1/2, par. 15-154
Amends the State Universities Article of the Illinois
Pension Code. Provides that for a police officer or
firefighter who retires on or after the effective date and
receives a money-purchase annuity calculated under Rule 2,
the additional normal contributions required to be paid by
police officers and firefighters shall be included in the
calculation of the annuity rather than refunded to the
annuitant. Effective immediately.
LRB9008488EGfg
LRB9008488EGfg
1 AN ACT to amend the Illinois Pension Code by changing
2 Sections 15-136 and 15-154.
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 15-136 and 15-154 as follows:
7 (40 ILCS 5/15-136) (from Ch. 108 1/2, par. 15-136)
8 Sec. 15-136. Retirement annuities - Amount.
9 (a) The amount of the retirement annuity shall be
10 determined by whichever of the following rules is applicable
11 and provides the largest annuity:
12 Rule 1: The retirement annuity shall be 1.67% of final
13 rate of earnings for each of the first 10 years of service,
14 1.90% for each of the next 10 years of service, 2.10% for
15 each year of service in excess of 20 but not exceeding 30,
16 and 2.30% for each year in excess of 30; or for persons who
17 retire on or after January 1, 1998, 2.2% of the final rate of
18 earnings for each year of service. However, except that the
19 annuity for those persons having made an election under
20 Section 15-154(a-1) shall be calculated and payable under the
21 portable retirement benefit program pursuant to the
22 provisions of Section 15-136.4.
23 Rule 2: The retirement annuity shall be the sum of the
24 following, determined from amounts credited to the
25 participant in accordance with the actuarial tables and the
26 prescribed rate of interest in effect at the time the
27 retirement annuity begins:
28 (i) the normal annuity which can be provided on an
29 actuarially equivalent basis, by the accumulated normal
30 contributions as of the date the annuity begins; and
31 (ii) an annuity from employer contributions of an
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1 amount which can be provided on an actuarially equivalent
2 basis from the accumulated normal contributions made by
3 the participant under Section 15-113.6 and Section
4 15-113.7 plus 1.4 times all other accumulated normal
5 contributions made by the participant, except that the
6 annuity for those persons having made an election under
7 Section 15-154(a-1) shall be calculated and payable under
8 the portable retirement benefit program pursuant to the
9 provisions of Section 15-136.4.
10 With respect to a police officer or firefighter who retires
11 on or after the effective date of this amendatory Act of
12 1998, the accumulated normal contributions taken into account
13 under clauses (i) and (ii) of this Rule 2 shall include the
14 additional normal contributions made by the police officer or
15 firefighter under Section 15-157(a).
16 Rule 3: The retirement annuity of a participant who is
17 employed at least one-half time during the period on which
18 his or her final rate of earnings is based, shall be equal to
19 the participant's years of service not to exceed 30,
20 multiplied by (1) $96 if the participant's final rate of
21 earnings is less than $3,500, (2) $108 if the final rate of
22 earnings is at least $3,500 but less than $4,500, (3) $120 if
23 the final rate of earnings is at least $4,500 but less than
24 $5,500, (4) $132 if the final rate of earnings is at least
25 $5,500 but less than $6,500, (5) $144 if the final rate of
26 earnings is at least $6,500 but less than $7,500, (6) $156 if
27 the final rate of earnings is at least $7,500 but less than
28 $8,500, (7) $168 if the final rate of earnings is at least
29 $8,500 but less than $9,500, and (8) $180 if the final rate
30 of earnings is $9,500 or more, except that the annuity for
31 those persons having made an election under Section
32 15-154(a-1) shall be calculated and payable under the
33 portable retirement benefit program pursuant to the
34 provisions of Section 15-136.4.
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1 Rule 4: A participant who is at least age 50 and has 25
2 or more years of service as a police officer or firefighter,
3 and a participant who is age 55 or over and has at least 20
4 but less than 25 years of service as a police officer or
5 firefighter, shall be entitled to a retirement annuity of 2
6 1/4% of the final rate of earnings for each of the first 10
7 years of service as a police officer or firefighter, 2 1/2%
8 for each of the next 10 years of service as a police officer
9 or firefighter, and 2 3/4% for each year of service as a
10 police officer or firefighter in excess of 20, except that
11 the annuity for those persons having made an election under
12 Section 15-154(a-1) shall be calculated and payable under the
13 portable retirement benefit program pursuant to the
14 provisions of Section 15-136.4. The retirement annuity for
15 all other service shall be computed under Rule 1, payable
16 under the portable retirement benefit program pursuant to the
17 provisions of Section 15-136.4, if applicable.
18 (b) The retirement annuity provided under Rules 1 and 3
19 above shall be reduced by 1/2 of 1% for each month the
20 participant is under age 60 at the time of retirement.
21 However, this reduction shall not apply in the following
22 cases:
23 (1) For a disabled participant whose disability
24 benefits have been discontinued because he or she has
25 exhausted eligibility for disability benefits under
26 clause (6) of Section 15-152;
27 (2) For a participant who has at least the number
28 of years of service required to retire at any age under
29 subsection (a) of Section 15-135; or
30 (3) For that portion of a retirement annuity which
31 has been provided on account of service of the
32 participant during periods when he or she performed the
33 duties of a police officer or firefighter, if these
34 duties were performed for at least 5 years immediately
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1 preceding the date the retirement annuity is to begin.
2 (c) The maximum retirement annuity provided under Rules
3 1, 2, and 4 shall be the lesser of (1) the annual limit of
4 benefits as specified in Section 415 of the Internal Revenue
5 Code of 1986, as such Section may be amended from time to
6 time and as such benefit limits shall be adjusted by the
7 Commissioner of Internal Revenue, and (2) 80% of final rate
8 of earnings.
9 (d) An annuitant whose status as an employee terminates
10 after August 14, 1969 shall receive automatic increases in
11 his or her retirement annuity as follows:
12 Effective January 1 immediately following the date the
13 retirement annuity begins, the annuitant shall receive an
14 increase in his or her monthly retirement annuity of 0.125%
15 of the monthly retirement annuity provided under Rule 1, Rule
16 2, Rule 3, or Rule 4, contained in this Section, multiplied
17 by the number of full months which elapsed from the date the
18 retirement annuity payments began to January 1, 1972, plus
19 0.1667% of such annuity, multiplied by the number of full
20 months which elapsed from January 1, 1972, or the date the
21 retirement annuity payments began, whichever is later, to
22 January 1, 1978, plus 0.25% of such annuity multiplied by the
23 number of full months which elapsed from January 1, 1978, or
24 the date the retirement annuity payments began, whichever is
25 later, to the effective date of the increase.
26 The annuitant shall receive an increase in his or her
27 monthly retirement annuity on each January 1 thereafter
28 during the annuitant's life of 3% of the monthly annuity
29 provided under Rule 1, Rule 2, Rule 3, or Rule 4 contained in
30 this Section. The change made under this subsection by P.A.
31 81-970 is effective January 1, 1980 and applies to each
32 annuitant whose status as an employee terminates before or
33 after that date.
34 Beginning January 1, 1990, all automatic annual increases
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1 payable under this Section shall be calculated as a
2 percentage of the total annuity payable at the time of the
3 increase, including all increases previously granted under
4 this Article.
5 The change made in this subsection by P.A. 85-1008 is
6 effective January 26, 1988, and is applicable without regard
7 to whether status as an employee terminated before that date.
8 (e) If, on January 1, 1987, or the date the retirement
9 annuity payment period begins, whichever is later, the sum of
10 the retirement annuity provided under Rule 1 or Rule 2 of
11 this Section and the automatic annual increases provided
12 under the preceding subsection or Section 15-136.1, amounts
13 to less than the retirement annuity which would be provided
14 by Rule 3, the retirement annuity shall be increased as of
15 January 1, 1987, or the date the retirement annuity payment
16 period begins, whichever is later, to the amount which would
17 be provided by Rule 3 of this Section. Such increased amount
18 shall be considered as the retirement annuity in determining
19 benefits provided under other Sections of this Article. This
20 paragraph applies without regard to whether status as an
21 employee terminated before the effective date of this
22 amendatory Act of 1987, provided that the annuitant was
23 employed at least one-half time during the period on which
24 the final rate of earnings was based.
25 (f) A participant is entitled to such additional annuity
26 as may be provided on an actuarially equivalent basis, by any
27 accumulated additional contributions to his or her credit.
28 However, the additional contributions made by the participant
29 toward the automatic increases in annuity provided under this
30 Section shall not be taken into account in determining the
31 amount of such additional annuity.
32 (g) If, (1) by law, a function of a governmental unit,
33 as defined by Section 20-107 of this Code, is transferred in
34 whole or in part to an employer, and (2) a participant
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1 transfers employment from such governmental unit to such
2 employer within 6 months after the transfer of the function,
3 and (3) the sum of (A) the annuity payable to the participant
4 under Rule 1, 2, or 3 of this Section (B) all proportional
5 annuities payable to the participant by all other retirement
6 systems covered by Article 20, and (C) the initial primary
7 insurance amount to which the participant is entitled under
8 the Social Security Act, is less than the retirement annuity
9 which would have been payable if all of the participant's
10 pension credits validated under Section 20-109 had been
11 validated under this system, a supplemental annuity equal to
12 the difference in such amounts shall be payable to the
13 participant.
14 (h) On January 1, 1981, an annuitant who was receiving a
15 retirement annuity on or before January 1, 1971 shall have
16 his or her retirement annuity then being paid increased $1
17 per month for each year of creditable service. On January 1,
18 1982, an annuitant whose retirement annuity began on or
19 before January 1, 1977, shall have his or her retirement
20 annuity then being paid increased $1 per month for each year
21 of creditable service.
22 (i) On January 1, 1987, any annuitant whose retirement
23 annuity began on or before January 1, 1977, shall have the
24 monthly retirement annuity increased by an amount equal to 8¢
25 per year of creditable service times the number of years that
26 have elapsed since the annuity began.
27 (Source: P.A. 90-14, eff. 7-1-97; 90-65, eff. 7-7-97; 90-448,
28 eff. 8-16-97; revised 8-21-97.)
29 (40 ILCS 5/15-154) (from Ch. 108 1/2, par. 15-154)
30 Sec. 15-154. Refunds.
31 (a) A participant whose status as an employee is
32 terminated, regardless of cause, or who has been on lay off
33 status for more than 120 days, and who is not on leave of
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1 absence, is entitled to a refund of contributions upon
2 application; except that not more than one such refund
3 application may be made during any academic year.
4 Except as set forth in subsections (a-1) and (a-2), the
5 refund shall be the sum of the accumulated normal, additional
6 and survivors insurance contributions, less the amount of
7 interest credited on these contributions each year in excess
8 of 4 1/2% of the amount on which interest was calculated.
9 (a-1) Every person who becomes a participating employee
10 after the date on which his or her employer first offers an
11 optional retirement program under Section 15-158.2 may elect
12 within 60 days of becoming a participant to have any refund
13 calculated pursuant to subsection (a-2) by forgoing all
14 survivors insurance benefits to which the person's survivors
15 would otherwise be entitled under this Article. This
16 election is irrevocable and may be made by filing an election
17 with the system on such form as the Executive Director shall
18 prescribe.
19 Each person who is a participating employee on the date
20 on which his or her employer first offers an optional
21 retirement program under Section 15-158.2 shall have a
22 one-time option to elect to have his or her refund calculated
23 pursuant to subsection (a-2), by forgoing all survivors
24 insurance benefits to which the person's survivors would
25 otherwise be entitled under this Article. The election will
26 not be effective until one year after the election is filed
27 with the system. This election is irrevocable and may be
28 made by filing an election with the system, on such form as
29 the Executive Director shall prescribe, within one year after
30 the date on which his or her employer first offers an
31 optional retirement program under Section 15-158.2.
32 A person may make the one-time irrevocable election
33 authorized under this Section or the election authorized
34 under Section 15-158.2(g), but may not make both elections.
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1 Any person interested in electing the portable retirement
2 benefit program provided under this Section and Section
3 15-136.4 must be given a consultation with the State
4 Universities Retirement System before making that election.
5 (a-2) The refund elected under subsection (a-1) shall be
6 the sum of the participant's accumulated normal and
7 additional contributions, as defined in Sections 15-116 and
8 15-117. If the participant terminates with 5 or more years
9 of service for employment as defined in Section 15-113.1, he
10 or she shall also be entitled to a refund of employer
11 contributions in an amount equal to the sum of the
12 accumulated normal and additional contributions, as defined
13 in Sections 15-116 and 15-117.
14 (b) Upon acceptance of a refund, the participant
15 forfeits all accrued rights and credits in the System, and if
16 subsequently reemployed, the participant shall be considered
17 a new employee subject to all the qualifying conditions for
18 participation and eligibility for benefits applicable to new
19 employees. If such person again becomes a participating
20 employee and continues as such for 2 years, or is employed by
21 an employer and participates for at least 2 years in the
22 Federal Civil Service Retirement System, all such rights,
23 credits, and previous status as a participant shall be
24 restored upon repayment of the amount of the refund, together
25 with compound interest thereon from the date the refund was
26 received to the date of repayment at the rate of 6% per annum
27 through August 31, 1982, and at the effective rates after
28 that date.
29 (c) If a participant has made survivors insurance
30 contributions, but has no survivors insurance beneficiary
31 upon retirement, he or she shall be entitled to a refund of
32 the accumulated survivors insurance contributions, or to an
33 additional annuity the value of which is equal to the
34 accumulated survivors insurance contributions.
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1 (d) A participant, upon application, is entitled to a
2 refund of his or her accumulated additional contributions
3 except those covering the cost of the annual increase in the
4 retirement annuity provided under Section 15-136. Upon the
5 acceptance of such a refund of accumulated additional
6 contributions, the participant forfeits all rights and
7 credits which may have accrued because of such contributions.
8 (e) A participant who terminates his or her employee
9 status and elects to waive service credit under Section
10 15-154.2, is entitled to a refund of the accumulated normal,
11 additional and survivors insurance contributions, if any,
12 which were credited the participant for this service, or to
13 an additional annuity the value of which is equal to the
14 accumulated normal, additional and survivors insurance
15 contributions, if any; except that not more than one such
16 refund application may be made during any academic year. Upon
17 acceptance of this refund, the participant forfeits all
18 rights and credits accrued because of this service.
19 (f) If a police officer or firefighter receives a
20 retirement annuity under Rule 1, 2, or 3 of Section 15-136,
21 he or she shall be entitled at retirement to a refund of the
22 difference between his or her accumulated normal
23 contributions and the normal contributions which would have
24 accumulated had such person filed a waiver of the retirement
25 formula provided by Rule 4 of Section 15-136.
26 (g) If, at the time of retirement, a participant would
27 be entitled to a retirement annuity under Rule 1, 2, 3 or 4
28 of Section 15-136 that exceeds the maximum specified in
29 clause (1) of subsection (c) of Section 15-136, he or she
30 shall be entitled to a refund of the employee contributions,
31 if any, paid under Section 15-157 after the date upon which
32 continuance of such contributions would have otherwise caused
33 the retirement annuity to exceed this maximum, plus compound
34 interest at the effective rates.
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1 (Source: P.A. 90-448, eff. 8-16-97.)
2 Section 99. Effective date. This Act takes effect upon
3 becoming law.