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92_HB0432 LRB9203114LDpr 1 AN ACT in relation to public employee benefits. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 5. The State Finance Act is amended by changing 5 Sections 14a and 15a as follows: 6 (30 ILCS 105/14a) (from Ch. 127, par. 150a) 7 Sec. 14a. Payments for unused benefits; use of sick 8 leave. 9 (a) Upon the death of a State employee, his or her 10 estate is entitled to receive from the appropriation for 11 personal services available for payment of his or her 12 compensation such sum for accrued vacation period, accrued 13 overtime, and accrued qualifying sick leave as would have 14 been paid or allowed to such employee had he or she survived 15 and terminated his or her employment. 16 The State Comptroller shall draw a warrant or warrants 17 against the appropriation, upon receipt of a proper death 18 certificate, payable to decedent's estate, or if no estate is 19 opened, to the person or persons entitled thereto under 20 Section 25-1 of the Probate Act of 1975 upon receipt of the 21 affidavit referred to in that Section, for the sum due. 22 (b) The Department of Central Management Services shall 23 prescribe by rule the method of computing the accrued 24 vacation period and accrued overtime for all employees, 25 including those not otherwise subject to its jurisdiction, 26 and for the purposes of this Act the Department of Central 27 Management Services may require such reports as it deems 28 necessary. Accrued sick leave shall be computed as provided 29 in subsection (f). 30 (c) Upon the retirement or resignation of a State 31 employee from State service, his or her accrued vacation, -2- LRB9203114LDpr 1 overtime and qualifying sick leave shall be payable to the 2 employee in a single lump sum payment. 3 A lump sum payment payable under this subsection (c) on 4 or after January 1, 2002 and before March 1, 2003 shall not 5 be combined with or submitted on the same payroll voucher as 6 the employee's last payment of salary and shall be subject to 7 withholding at the following rates: 28% for federal income 8 tax purposes and 3% for Illinois State income tax purposes. 9 A lump sum payment payable under this subsection (c) to a 10 person who terminates State service during June of 2002 may 11 be paid during July or August of 2002 from either a fiscal 12 year 2002 appropriation or a fiscal year 2003 appropriation. 13However,14 If the employee returns to employment in any capacity 15 with the same agency or department within 30 days of the 16 termination of his or her previous State employment, the 17 employee must, as a condition of his or her new State 18 employment, repay the lump sum amount within 30 days after 19 his or her new State employment commences. The amount repaid 20 shall be deposited into the fund from which the payment was 21 made or the General Revenue Fund, and the accrued vacation, 22 overtime and sick leave upon which the lump sum payment was 23 based shall be credited to the account of the employee in 24 accordance with the rules of the jurisdiction under which he 25 or she is employed. 26 (d) Upon the movement of a State employee from a 27 position subject to the Personnel Code to another State 28 position not subject to the Personnel Code, or to a position 29 subject to the Personnel Code from a State position not 30 subject to the Personnel Code, or upon the movement of a 31 State employee of an institution or agency subject to the 32 State Universities Civil Service System from one such 33 institution or agency to another such institution or agency, 34 his or her accrued vacation, overtime and sick leave shall be -3- LRB9203114LDpr 1 credited to the employee's account in accordance with the 2 rules of the jurisdiction to which the State employee moved. 3 However, if the rules preclude crediting the State employee's 4 total accrued vacation, overtime or sick leave to his or her 5 account at the jurisdiction to which he or she is to move, 6 the nontransferable accrued vacation, overtime, and 7 qualifying sick leave shall be payable to the employee in a 8 single lump sum payment by the jurisdiction from which he or 9 she moved. 10 (e) Upon the death of a State employee or the 11 retirement, indeterminate layoff or resignation of a State 12 employee from State service, the employee's retirement or 13 disability benefits shall be computed as if the employee had 14 remained in the State employment at his or her most recent 15 rate of compensation until his or her accumulated unused 16 leave for vacation, overtime, sickness and personal business 17 would have been exhausted. The employing agency shall 18 certify, in writing to the employee, the unused leaves the 19 employee has accrued. This certification may be held by the 20 employee or forwarded to the retirement fund. Employing 21 agencies not covered by the Personnel Code shall certify, in 22 writing to the employee, the unused leaves the employee has 23 accrued. 24 (f) Accrued sick leave shall be computed by multiplying 25 1/2 of the number of days of accumulated sick leave by the 26 daily rate of compensation applicable to the employee at the 27 time of his or her death, retirement, resignation, or other 28 termination of service described in this Section. 29 The payment for qualifying accrued sick leave after the 30 employee's death, retirement, resignation, or other 31 termination of service provided by Public Act 83-976 shall be 32 for sick leave days earned on or after January 1, 1984 and 33 before January 1, 1998. Sick leave accumulated on or after 34 January 1, 1998 is not compensable under this Section at the -4- LRB9203114LDpr 1 time of the employee's death, retirement, resignation, or 2 other termination of service, but may be used to establish 3 retirement system service credit as provided in the Illinois 4 Pension Code. 5 The Department of Central Management Services shall 6 prescribe by rule the method of computing the accrued sick 7 leave days for all employees, including those not otherwise 8 subject to its jurisdiction. Beginning January 1, 1998, sick 9 leave used by an employee shall be charged against his or her 10 accumulated sick leave in the following order: first, sick 11 leave accumulated before January 1, 1984; then sick leave 12 accumulated on or after January 1, 1998; and finally sick 13 leave accumulated on or after January 1, 1984 but before 14 January 1, 1998. 15 (Source: P.A. 90-65, eff. 7-7-97.) 16 (30 ILCS 105/15a) (from Ch. 127, par. 151a) 17 Sec. 15a. Contractual services. The item "contractual 18 services", when used in an appropriation act, means and 19 includes: 20 (a) Expenditures incident to the current conduct 21 and operation of an office, department, board, 22 commission, institution or agency for postage and postal 23 charges, surety bond premiums, publications, 24 subscriptions, office conveniences and services, 25 exclusive of commodities as herein defined; 26 (b) Expenditures for rental of property or 27 equipment, repair or maintenance of property or equipment 28 including related supplies, equipment, materials, 29 services, replacement fixtures and repair parts, utility 30 services, professional or technical services, moving 31 expenses incident to a new State employment, and 32 transportation charges exclusive of "travel" as herein 33 defined; -5- LRB9203114LDpr 1 (c) Expenditures for the rental of lodgings in 2 Springfield, Illinois and for the payment of utilities 3 used in connection with such lodgings for all elected 4 State officials, who are required by Section 1, Article V 5 of the Constitution of the State of Illinois to reside at 6 the seat of government during their term of office; 7 (d) Expenditures pursuant to multi-year lease, 8 lease-purchase or installment purchase contracts for 9 duplicating equipment authorized by Section 5.1 of the 10 Illinois Purchasing Act; 11 (e) Expenditures of $5,000 or less per project for 12 improvements to real property which, except for the 13 operation of this Section, would be classified as 14 "permanent improvements" as defined in Section 21; 15 (f) Expenditures pursuant to multi-year lease, 16 lease-purchase or installment purchase contracts for 17 land, permanent improvements or fixtures. 18 The item "contractual services" does not, however, 19 include any expenditures included in "operation of automotive 20 equipment" as defined in Section 24.2. 21 The item "contractual services" does not include any 22 expenditures for professional, technical, or other services 23 performed for a State agency under a contract executed after 24 July 1,the effective date of this amendatory Act of1992 by 25 a person who was formerly employed by that agency and has 26 received any early retirement incentive under Section 27 14-108.3 or 16-133.3 of the Illinois Pension Code based on 28 retirement before 1993, unless the official or employee 29 executing the contract on behalf of the agency has certified 30 that the person performing the services either (i) possesses 31 unique expertise, or (ii) is essential to the operation of 32 the agency. This certification must be filed with the Office 33 of the Auditor General prior to the execution of the 34 contract, and shall be made available by that Office for -6- LRB9203114LDpr 1 public inspection and copying. The item "contractual 2 services" does not include any expenditures for professional, 3 technical, or other services performed for a State agency 4 under a contract executed after the effective date of this 5 amendatory Act of the 92nd General Assembly by a person who 6 has received any early retirement incentive under Section 7 14-108.3 or 16-133.3 of the Illinois Pension Code based on 8 retirement in 2001 or later. A contract not payable from the 9 contractual services item because of this paragraph shall not 10 be payable from any other item of appropriation. For the 11 purposes of this paragraph, the term "agency" includes all 12 offices, boards, commissions, departments, agencies, and 13 institutions of State government. 14 (Source: P.A. 91-357, eff. 7-29-99.) 15 Section 10. The Illinois Pension Code is amended by 16 changing Sections 14-108.3 and 16-133.3 as follows: 17 (40 ILCS 5/14-108.3) 18 Sec. 14-108.3. Early retirement incentives. 19 (a) To be eligible for the benefits provided in this 20 Section, a person must: 21 (1) be a member of this System who, on any day 22 during December, 2001, is (i) in active payroll status in 23 a position of employment with a department and terminates 24 that employment before the retirement annuity under this 25 Article begins, or (ii) on layoff status from such a 26 position with a right of re-employment or recall to 27 service, or (iii) receiving benefits under Section 28 14-123, 14-123.1 or 14-124, but only if the member has 29 not been receiving those benefits for a continuous period 30 of more than 2 years as of the date of application; 31 (2) have not previously retired under this Article 32 or Article 2, 15, 16, 17, or 18; -7- LRB9203114LDpr 1 (3) file with the Board before June 1, 2002, a 2 written application requesting the benefits provided in 3 this Section; 4 (4) establish eligibility to receive a retirement 5 annuity under this Article (for which purpose any age 6 enhancement or creditable service received under this 7 Section may be used) by the earlier of July 1, 2002 or 8 the date the retirement annuity begins, and elect to 9 receive the retirement annuity beginning no earlier than 10 January 1, 2002 and no later than July 1, 2002 (or the 11 date established under subsection (d) if applicable); 12 (5) have attained age 50 or accumulated 30 or more 13 years of creditable service (without the use of any age 14 enhancement or creditable service received under this 15 Section) by the date of commencement of the annuity; and 16 (6) by the date of commencement of the annuity, 17 have at least 5 years of membership service earned while 18 an employee under this Article, which may include 19 military service for which credit is established under 20 Section 14-105(b), service during the qualifying period 21 for which credit is established under Section 14-104(a), 22 and service for which credit has been established by 23 repaying a refund under Section 14-130, but shall not 24 include service for which any other optional service 25 credit has been established. 26 A person who has established additional creditable 27 service under any other early retirement incentive program 28 under this Code is not eligible to participate in the program 29 of early retirement incentives established under this 30 Section. 31 (b) An eligible person may establish up to 5 years of 32 creditable service under this Article, in increments of one 33 month, by making the contributions specified in subsection 34 (c). In addition, for each month of creditable service -8- LRB9203114LDpr 1 established under this Section, a person's age at retirement 2 shall be deemed to be one month older than it actually is. 3 The creditable service established under this Section may 4 be used for all purposes under this Article and the 5 Retirement Systems Reciprocal Act, except for the computation 6 of final average compensation under Section 14-103.12 or the 7 determination of compensation under this or any other Article 8 of this Code. 9 The age enhancement established under this Section may be 10 used for all purposes under this Article (including 11 calculation of a proportionate annuity payable by this System 12 under the Retirement Systems Reciprocal Act), except for 13 purposes of the level income option in Section 14-112, the 14 reversionary annuity under Section 14-113, and the required 15 distributions under Section 14-121.1. 16 The age enhancement established under this Section may be 17 used in determining benefits payable under Article 16 of this 18 Code under the Retirement Systems Reciprocal Act, if the 19 person has at least 5 years of service credit in the Article 20 16 system that was earned while participating in that system 21 as a teacher (as defined in Section 16-106) employed by a 22 department (as defined in Section 14-103.04). Age 23 enhancement established under this Section shall not 24 otherwise be used in determining benefits payable under other 25 Articles of this Code under the Retirement Systems Reciprocal 26 Act. 27 (c) For all creditable service established under this 28 Section, a person must pay to the System an employee 29 contribution to be determined by the System, based on the 30 member's rate of compensation on November 1, 2001 (or the 31 last date before November 1, 2001 for which a rate can be 32 determined) and one-half of the retirement contribution rate 33 in effect on November 1, 2001 for the member (or for members 34 with the same social security and alternative formula status -9- LRB9203114LDpr 1 as the member). 2 If the member receives a lump sum payment for accumulated 3 vacation, sick leave, and personal leave upon withdrawal from 4 service, and the net amount of that lump sum payment is at 5 least as great as the amount of the contribution required 6 under this Section, the entire contribution must be paid by 7 the employee before the retirement annuity may become 8 payable. If there is no such lump sum payment, or if it is 9 less than the contribution required under this Section, the 10 member may either pay the entire contribution before the 11 retirement annuity becomes payable or instead make an initial 12 payment before the retirement annuity becomes payable, equal 13 to the net amount of the lump sum payment for accumulated 14 vacation, sick leave, and personal leave, and have the 15 remaining amount due deducted from the retirement annuity in 16 24 equal monthly installments beginning in the month in which 17 the retirement annuity takes effect. The required 18 contribution may be paid as a pre-tax deduction from 19 earnings, but only if the required contribution is less than 20 the net amount of the lump sum payment for accumulated 21 vacation, sick leave, and personal leave. 22 (d) In order to ensure that the efficient operation of 23 State government is not jeopardized by the simultaneous 24 retirement of large numbers of key personnel, the director or 25 other head of a department may, for key employees of that 26 department, extend the July 1, 2002 deadline for the 27 effective date of a retirement annuity established in 28 subdivision (a)(4) of this Section to a date not later than 29 January 1, 2003 by so notifying the System in writing before 30 July 1, 2002. 31 (e) Notwithstanding Section 14-111, an annuitant who has 32 received any age enhancement or creditable service under this 33 Section and who reenters service under this Article other 34 than as a temporary employee shall thereby forfeit such age -10- LRB9203114LDpr 1 enhancement and creditable service, and become entitled to a 2 refund of the contributions made pursuant to this Section. 3 (f) For the sole purpose of determining eligibility for 4 the automatic annual increase in retirement annuity under 5 Section 14-114, an annuitant who is receiving any early 6 retirement incentive under this Section and whose retirement 7 annuity begins on or before July 1, 2002 shall be deemed to 8 have retired on January 1, 2002, regardless of the actual 9 date of retirement. 10 (g) The System shall determine the amount of the 11 increase in unfunded accrued liability resulting from the 12 granting of early retirement incentives under this Section 13 and shall report that amount to the Governor and the Pension 14 Laws Commission on or before April 1, 2003. The increase in 15 liability reported under this subsection (g) shall not be 16 included in the calculation of the required State 17 contribution under Section 14-131. 18 (h) The System shall determine the amount of the annual 19 State contribution necessary to amortize on a level 20 dollar-payment basis, over a period of 6 years at 8.5% 21 interest, compounded annually, an amount equal to the 22 increase in unfunded accrued liability determined under 23 subsection (g) minus $90,000,000. The System shall certify 24 the amount of this annual State contribution to the Governor, 25 the State Comptroller, the Bureau of the Budget, and the 26 Pension Laws Commission on or before April 1, 2003. 27 In addition to the contributions otherwise required under 28 this Article, the State shall appropriate and pay to the 29 System (1) an amount equal to $90,000,000 in State fiscal 30 year 2003 and (2) in each of State fiscal years 2004 through 31 2009, an amount equal to the annual State contribution 32 certified by the System under this subsection (h). 33 (i) The Pension Laws Commission shall determine and 34 report to the General Assembly, on or before October 1, 2003 -11- LRB9203114LDpr 1 and annually thereafter through the year 2009, its estimate 2 of (1) the annual amount of payroll savings likely to be 3 realized by the State as a result of the early retirement of 4 persons receiving early retirement incentives under this 5 Section and (2) the net annual savings or cost to the State 6 from the program of early retirement incentives created under 7 this Section. 8 The System, the Department of Central Management 9 Services, the Bureau of the Budget, and all other departments 10 shall provide to the Commission any assistance that the 11 Commission may request with respect to its reports under this 12 Section. The Commission may require departments to provide 13 it with any information that it deems necessary or useful 14 with respect to its reports under this Section, including 15 without limitation information about (1) the final earnings 16 of former department employees who elected to receive 17 benefits under this Section, (2) the earnings of current 18 department employees holding the positions vacated by persons 19 who elected to receive benefits under this Section, and (3) 20 positions vacated by persons who elected to receive benefits 21 under this Section that have not yet been refilled. 22 (j) It is the purpose of this Section to enable the 23 State to realize savings in payroll costs by replacing 24 certain highly-compensated employees with employees who have 25 less seniority and are therefore, on the average, less highly 26 compensated. To this end, in State fiscal year 2004 the 27 General Assembly shall not fund the positions vacated by 28 persons receiving early retirement incentives under this 29 Section at more than 85% of the rate of compensation payable 30 to those persons at the time of their retirement. 31 (k) The changes made to this Section by this amendatory 32 Act of the 92nd General Assembly do not apply to persons who 33 retired under this Section on or before May 1, 1992. 34(a) To be eligible for the benefits provided in this-12- LRB9203114LDpr 1Section, a person must:2(1) be a member of this System who, on any day3during May, 1991, is (i) in active payroll status in a4position of employment with a department, or (ii) on5layoff status from such a position with a right of6re-employment or recall to service, or (iii) on leave of7absence from such a position, but only if the member on8leave has not been receiving benefits under Section914-123, 14-123.1 or 14-124 for a continuous period of 210years or more as of the date of application;11(2) have not retired under this Article;12(3) file with the Board before December 1, 1991, a13written application requesting the benefits provided in14this Section;15(4) establish eligibility to receive a retirement16annuity under this Article (for which purpose any age17enhancement or creditable service received under this18Section may be used) and elect to receive the retirement19annuity beginning not earlier than the first day of the20month following the month in which this amendatory Act of211991 takes effect, and not later than January 1, 1992 (or22the date established under subsection (e) if applicable);23(5) have attained age 50 or accumulated 30 or more24years of creditable service (without the use of any age25enhancement or creditable service received under this26Section) by December 31, 1991.27(b) An eligible person may establish up to 5 years of28creditable service under this Article, in increments of one29month, by making the contributions specified in subsection30(c). In addition, for each month of creditable service31established under this Section, a person's age at retirement32shall be deemed to be one month older than it actually is.33The creditable service established under this Section may34be used for all purposes under this Article and the-13- LRB9203114LDpr 1Retirement Systems Reciprocal Act, except for the computation2of final average compensation under Section 14-103.12, or the3determination of compensation under this or any other Article4of this Code.5The age enhancement established under this Section may be6used for all purposes under this Article (including7calculation of a proportionate annuity payable by this System8under the Retirement Systems Reciprocal Act), except for9purposes of the level income option in Section 14-112, the10reversionary annuity under Section 14-113, and the required11distributions under Section 14-121.1. However, age12enhancement established under this Section shall not be used13in determining benefits payable under other Articles of this14Code under the Retirement Systems Reciprocal Act.15(c) For all creditable service established under this16Section, a person must pay to the System an employee17contribution to be determined by the System, based on the18member's final rate of compensation and one-half of the19retirement contribution rate in effect for the member on the20date of withdrawal.21If the member receives a lump sum payment for accumulated22vacation, sick leave and personal leave upon withdrawal from23service, and the net amount of that lump sum payment is at24least as great as the amount of the contribution required25under this Section, the entire contribution (or so much of it26as does not exceed the contribution limitations of Section27415 of the Internal Revenue Code of 1986) must be paid by the28employee before the retirement annuity may become payable.29If there is no such lump sum payment, or if it is less than30the contribution required under this Section the member may31either pay the entire contribution before the retirement32annuity becomes payable, or may instead make an initial33payment before the retirement annuity becomes payable, equal34to the net amount of the lump sum payment for accumulated-14- LRB9203114LDpr 1vacation, sick leave and personal leave (or so much of it as2does not exceed the contribution limitations of Section 4153of the Internal Revenue Code of 1986), and have the remaining4amount due deducted from the retirement annuity in 24 equal5monthly installments beginning in January of 1992 or in the6month in which the retirement annuity takes effect, whichever7is later.8However, if the net amount of the lump sum payment for9accumulated vacation, sick leave and personal leave equals or10exceeds the contribution required under this Section, but the11required contribution exceeds an applicable contribution12limitation contained in Section 415 of the Internal Revenue13Code of 1986, then the amount of the contribution in excess14of the Section 415 limitation shall instead be paid by the15annuitant in January of 1992 or in the month in which the16retirement annuity takes effect, whichever is later. If this17additional amount is not paid as required, the retirement18annuity shall be suspended until the required contribution is19received.20(d) In the event that the age enhancement or creditable21service received under this Section result in a retirement22benefit that exceeds any applicable benefit limitation23contained in Section 415 of the Internal Revenue Code of241986, the amount of the retirement benefit that exceeds the25Section 415 limitation shall not be paid for any period to26which the limitation is applicable. If no contributions are27otherwise due in 1992 and 1993 under subsection (c) from an28annuitant whose retirement benefits are subject to limitation29under this subsection, then 10% of the contribution otherwise30required under subsection (c) to be paid before the31retirement annuity becomes payable shall instead be32contributed to the System by the annuitant in January of331993.34(e) In order to ensure that the public health and safety-15- LRB9203114LDpr 1are not jeopardized by the simultaneous retirement of large2numbers of critical personnel, the Director of State Police3(for State police officers under the Department of State4Police) and the Director of Corrections (for security staff5at adult and juvenile institutions under the Department of6Corrections) may extend the January 1, 1992 deadline for the7effective date of a retirement annuity established in8subdivision (a)(4) of this Section to a date not later than9May 1, 1992, by so notifying the System in writing no later10than December 31, 1991.11In order to ensure that the efficient operation of the12courts of this State is not jeopardized by the simultaneous13retirement of large numbers of court reporters, the Chief14Justice of the Illinois Supreme Court may, for official court15reporters employed in the courts of this State, extend the16January 1, 1992 deadline for the effective date of a17retirement annuity established in subdivision (a)(4) of this18Section to a date not later than May 1, 1992, by so notifying19the System in writing no later than December 31, 1991.20(f) Notwithstanding Section 14-111, an annuitant who has21received any age enhancement or creditable service under this22Section and who reenters service under this Article other23than as a temporary employee shall thereby forfeit such age24enhancement and creditable service, and become entitled to a25refund of the contributions made pursuant to this Section.26 (Source: P.A. 87-14.) 27 (40 ILCS 5/16-133.3) (from Ch. 108 1/2, par. 16-133.3) 28 Sec. 16-133.3. Early retirement incentives for State 29 employees. 30 (a) To be eligible for the benefits provided in this 31 Section, a person must: 32 (1) be a member of this System who, on any day 33 during December, 2001, is (i) in active payroll status as -16- LRB9203114LDpr 1 a full-time teacher employed by a department, or (ii) on 2 layoff status from such a position with a right of 3 re-employment or recall to service, or (iii) receiving a 4 disability benefit under Section 16-149 or 16-149.1, but 5 only if the member has not been receiving that benefit 6 for a continuous period of more than 2 years as of the 7 date of application; 8 (2) have never previously received a retirement 9 annuity under this Article or Article 2, 14, 15, 17, or 10 18; 11 (3) file with the Board before June 1, 2002, a 12 written application requesting the benefits provided in 13 this Section; 14 (4) establish eligibility to receive a retirement 15 annuity under this Article (for which purpose any age 16 enhancement or creditable service received under this 17 Section may be used) by the earlier of July 1, 2002 or 18 the date the retirement annuity begins, and elect to 19 receive the retirement annuity beginning no earlier than 20 January 1, 2002 and no later than July 1, 2002 (or the 21 date established under subsection (d) if applicable); 22 (5) have attained age 50 (without the use of any 23 age enhancement received under this Section) by the date 24 of commencement of the annuity; and 25 (6) by the date of commencement of the annuity, 26 have at least 5 years of service credit earned while 27 participating in the System as a teacher employed by a 28 department. 29 For the purposes of this Section, "department" means a 30 department as defined in Section 14-103.04 that employs a 31 teacher as defined in this Article. 32 A person who has established additional creditable 33 service under any other early retirement incentive program 34 under this Code is not eligible to participate in the program -17- LRB9203114LDpr 1 of early retirement incentives established under this 2 Section. 3 (b) An eligible person may establish up to 5 years of 4 creditable service under this Article, in increments of one 5 month, by making the contributions specified in subsection 6 (c). In addition, for each month of creditable service 7 established under this Section, a person's age at retirement 8 shall be deemed to be one month older than it actually is. 9 The creditable service established under this Section may 10 be used for all purposes under this Article and the 11 Retirement Systems Reciprocal Act, except for the computation 12 of final average salary, the determination of salary or 13 compensation under this Article or any other Article of this 14 Code, or the determination of eligibility for or the 15 computation of benefits under Section 16-133.2. 16 The age enhancement established under this Section may be 17 used for all purposes under this Article (including 18 calculation of a proportionate annuity payable by this System 19 under the Retirement Systems Reciprocal Act), except for 20 purposes of a retirement annuity under Section 16-133(a)(A), 21 a reversionary annuity under Section 16-136, the required 22 distributions under Section 16-142.3, and the determination 23 of eligibility for or the computation of benefits under 24 Section 16-133.2. Age enhancement established under this 25 Section may be used in determining benefits payable under 26 Article 14 of this Code under the Retirement Systems 27 Reciprocal Act; age enhancement established under this 28 Section shall not be used in determining benefits payable 29 under other Articles of this Code under the Retirement 30 Systems Reciprocal Act. 31 (c) For all creditable service established under this 32 Section, a person must pay to the System an employee 33 contribution to be determined by the System, based on the 34 member's rate of compensation on November 1, 2001 (or the -18- LRB9203114LDpr 1 last date before November 1, 2001 for which a rate can be 2 determined) and one-half of the retirement contribution rate 3 in effect for members on November 1, 2001. 4 If the member receives a lump sum payment for accumulated 5 vacation, sick leave and personal leave upon withdrawal from 6 service, and the net amount of that lump sum payment is at 7 least as great as the amount of the contribution required 8 under this Section, the entire contribution must be paid by 9 the employee before the retirement annuity may become 10 payable. If there is no such lump sum payment, or if it is 11 less than the contribution required under this Section, the 12 member may either pay the entire contribution before the 13 retirement annuity becomes payable or instead make an initial 14 payment before the retirement annuity becomes payable, equal 15 to the net amount of the lump sum payment for accumulated 16 vacation, sick leave, and personal leave, and have the 17 remaining amount due deducted from the retirement annuity in 18 24 equal monthly installments beginning in the month in which 19 the retirement annuity takes effect. The required 20 contribution may be paid as a pre-tax deduction from 21 earnings, but only if the required contribution is less than 22 the net amount of the lump sum payment for accumulated 23 vacation, sick leave, and personal leave. 24 (d) In order to ensure that the efficient operation of 25 State government is not jeopardized by the simultaneous 26 retirement of large numbers of key personnel, the director or 27 other head of a department may, for key employees of that 28 department, extend the July 1, 2002 deadline for the 29 effective date of a retirement annuity established in 30 subdivision (a)(4) of this Section to a date not later than 31 January 1, 2003 by so notifying the System in writing before 32 July 1, 2002. 33 (e) An annuitant who has received any age enhancement or 34 creditable service under this Section and who reenters -19- LRB9203114LDpr 1 contributing service under this Article or Article 14 shall 2 thereby forfeit that age enhancement and creditable service, 3 and become entitled to a refund of the contributions made 4 pursuant to this Section. 5 (f) For the sole purpose of determining eligibility for 6 the automatic annual increase in retirement annuity under 7 Section 16-133.1, an annuitant who is receiving any early 8 retirement incentive under this Section and whose retirement 9 annuity begins on or before July 1, 2002 shall be deemed to 10 have retired on January 1, 2002, regardless of the actual 11 date of retirement. 12 (g) The System shall determine the amount of the 13 increase in unfunded accrued liability resulting from the 14 granting of early retirement incentives under this Section 15 and shall report that amount to the Governor and the Pension 16 Laws Commission on or before April 1, 2003. The increase in 17 liability reported under this subsection (g) shall not be 18 included in the calculation of the required State 19 contribution under Section 16-158. 20 (h) The System shall determine the amount of the annual 21 State contribution necessary to amortize on a level 22 dollar-payment basis, over a period of 6 years at 8.5% 23 interest, compounded annually, an amount equal to the 24 increase in unfunded accrued liability determined under 25 subsection (g) minus $1,000,000. The System shall certify 26 the amount of this annual State contribution to the Governor, 27 the State Comptroller, the Bureau of the Budget, and the 28 Pension Laws Commission on or before April 1, 2003. 29 In addition to the contributions otherwise required under 30 this Article, the State shall appropriate and pay to the 31 System (1) an amount equal to $1,000,000 in State fiscal year 32 2003 and (2) in each of State fiscal years 2004 through 2009, 33 an amount equal to the annual State contribution certified by 34 the System under this subsection (h). -20- LRB9203114LDpr 1 (i) The Pension Laws Commission shall determine and 2 report to the General Assembly, on or before October 1, 2003 3 and annually thereafter through the year 2009, its estimate 4 of (1) the annual amount of payroll savings likely to be 5 realized by the State as a result of the early retirement of 6 persons receiving early retirement incentives under this 7 Section and (2) the net annual savings or cost to the State 8 from the program of early retirement incentives created under 9 this Section. 10 The System, the Department of Central Management 11 Services, the Bureau of the Budget, and all other departments 12 shall provide to the Commission any assistance that the 13 Commission may request with respect to its reports under this 14 Section. The Commission may require departments to provide 15 it with any information that it deems necessary or useful 16 with respect to its reports under this Section, including 17 without limitation information about (1) the final earnings 18 of former department employees who elected to receive 19 benefits under this Section, (2) the earnings of current 20 department employees holding the positions vacated by persons 21 who elected to receive benefits under this Section, and (3) 22 positions vacated by persons who elected to receive benefits 23 under this Section that have not yet been refilled. 24 (j) It is the purpose of this Section to enable the 25 State to realize savings in payroll costs by replacing 26 certain highly-compensated employees with employees who have 27 less seniority and are therefore, on the average, less highly 28 compensated. To this end, in State fiscal year 2004 the 29 General Assembly shall not fund the positions vacated by 30 persons receiving early retirement incentives under this 31 Section at more than 85% of the rate of compensation payable 32 to those persons at the time of their retirement. 33 (k) The changes made to this Section by this amendatory 34 Act of the 92nd General Assembly do not apply to persons who -21- LRB9203114LDpr 1 retired under this Section on or before May 1, 1992. 2(a) To be eligible for the benefits provided in this3Section, a member must:4(1) be a member of this System who, on any day5during May, 1991, is (i) in active payroll status as a6full-time teacher employed by the Department of7Rehabilitation Services, the Department of Corrections,8the Department of Mental Health and Developmental9Disabilities, the Teachers' Retirement System of the10State of Illinois, the State Board of Education, or the11Illinois Purchased Care Review Board, or (ii) on layoff12status from such a position with a right of re-employment13or recall to service, or (iii) on a leave of absence from14such a position, but only if the member on leave has not15been receiving benefits under Section 16-149 or 16-149.116for a continuous period of 2 years or more as of the date17of application;18(2) have never previously received a retirement19annuity under this Article or Article 14, 15 or 17;20(3) file with the Board before December 1, 1991, a21written application requesting the benefits provided in22this Section;23(4) be eligible no later than January 1, 1992, to24receive a retirement annuity under this Article (for25which purpose any age enhancement or creditable service26received under this Section may be used) and elect to27receive the retirement annuity beginning not earlier than28the first day of the month following the month in which29this amendatory Act of 1991 takes effect, and not later30than January 1, 1992;31(5) have attained age 50 (without the use of any32age enhancement received under this Section) by December3331, 1991;34(6) have at least 5 years of creditable service-22- LRB9203114LDpr 1under this System or any of the participating systems2under the Retirement Systems Reciprocal Act (without the3use of any creditable service received under this4Section) by the effective date of the retirement annuity;5and6(7) have paid all applicable contributions as7required by this Section; however, the date such8contributions are received by the System shall not be9considered in determining the effective date of10retirement.11(b) An eligible person may establish up to 5 years of12creditable service under this Article by making the13contributions specified in subsection (c). In addition, for14each period of creditable service established under this15Section a person shall have his or her age at retirement16deemed enhanced by an equivalent period.17The creditable service established under this Section may18be used for all purposes under this Article and the19Retirement Systems Reciprocal Act, except for the computation20of final average salary, the determination of salary or21compensation under this or any other Article of the Code, or22the determination of eligibility for and the computation of23benefits under Section 16-133.2 of this Article.24The age enhancement established under this Section may be25used for all purposes under this Article (including26calculation of a proportionate annuity payable by this System27under the Retirement Systems Reciprocal Act), except for28purposes of a reversionary annuity under Section 16-136, the29retirement annuity under Section 16-133(a)(A), the required30distributions under Section 16-142.3, and the determination31of eligibility for and the computation of benefits under32Section 16-133.2 of this Article. However, age enhancement33established under this Section shall not be used in34determining benefits payable under other Articles of this-23- LRB9203114LDpr 1Code under the Retirement Systems Reciprocal Act.2(c) For all creditable service established under this3Section, a member must pay to the System an employee4contribution consisting of 4% of the member's highest annual5salary rate used in the determination of the average salary6for retirement annuity purposes for each year creditable7service has been increased under this Section.8If the member receives a lump sum payment for accumulated9vacation, sick leave and personal leave upon withdrawal from10service, and the net amount of that lump sum payment is at11least as great as the amount of the contribution required12under this Section, the entire contribution must be paid by13the employee before the retirement annuity may become14payable. If there is no such lump sum payment, or if it is15less than the contribution required under this Section, the16member may either pay the entire contribution before the17retirement annuity becomes payable, or may instead make an18initial payment before the retirement annuity becomes19payable, equal to the net amount of the lump sum payment for20accumulated vacation, sick leave and personal leave, and have21the remaining amount due deducted from the retirement annuity22in 24 equal monthly installments beginning in January of231992.24(d) An annuitant who has received any age enhancement or25creditable service under this Section and who re-enters26contributing service under this Article or Article 14, 15 or2717, shall thereby forfeit such age enhancement and creditable28service, and upon re-retirement the annuity shall be29recomputed. Upon forfeiting creditable service under this30subsection, a person shall be entitled to a refund of the31contribution paid under this Section.32 (Source: P.A. 89-21, eff. 7-1-95.) 33 Section 15. The State Pension Funds Continuing -24- LRB9203114LDpr 1 Appropriation Act is amended by adding Section 1.6 as 2 follows: 3 (40 ILCS 15/1.6 new) 4 Sec. 1.6. Appropriations for early retirement programs. 5 (a) There is hereby appropriated from the General 6 Revenue Fund to the State Employees' Retirement System of 7 Illinois, on a continuing annual basis in each of State 8 fiscal years 2003 through 2009, the amount, if any, by which 9 the total available amount of all other appropriations to 10 that retirement system for the payment of State contributions 11 under subsection (h) of Section 14-108.3 of the Illinois 12 Pension Code in that fiscal year is less than the total 13 amount of State contributions required for that fiscal year 14 under that subsection (h). 15 (b) There is hereby appropriated from the General 16 Revenue Fund to the Teachers' Retirement System of the State 17 of Illinois, on a continuing annual basis in each of State 18 fiscal years 2003 through 2009, the amount, if any, by which 19 the total available amount of all other appropriations to 20 that retirement system for the payment of State contributions 21 under subsection (h) of Section 16-133.3 of the Illinois 22 Pension Code in that fiscal year is less than the total 23 amount of State contributions required for that fiscal year 24 under that subsection (h). 25 Section 99. Effective date. This Act takes effect upon 26 becoming law.