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92_SB0642 LRB9208071LDmb 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 Illinois Pension Code is amended by 5 changing Section 7-139 as follows: 6 (40 ILCS 5/7-139) (from Ch. 108 1/2, par. 7-139) 7 Sec. 7-139. Credits and creditable service to employees. 8 (a) Each participating employee shall be granted credits 9 and creditable service, for purposes of determining the 10 amount of any annuity or benefit to which he or a beneficiary 11 is entitled, as follows: 12 1. For prior service: Each participating employee 13 who is an employee of a participating municipality or 14 participating instrumentality on the effective date shall 15 be granted creditable service, but no credits under 16 paragraph 2 of this subsection (a), for periods of prior 17 service for which credit has not been received under any 18 other pension fund or retirement system established under 19 this Code, as follows: 20 If the effective date of participation for the 21 participating municipality or participating 22 instrumentality is on or before January 1, 1998, 23 creditable service shall be granted for the entire period 24 of prior service with that employer without any employee 25 contribution. 26 If the effective date of participation for the 27 participating municipality or participating 28 instrumentality is after January 1, 1998, creditable 29 service shall be granted for the last 20% of the period 30 of prior service with that employer, but no more than 5 31 years, without any employee contribution. A -2- LRB9208071LDmb 1 participating employee may establish creditable service 2 for the remainder of the period of prior service with 3 that employer by making an application in writing, 4 accompanied by payment of an employee contribution in an 5 amount determined by the Fund, based on the employee 6 contribution rates in effect at the time of application 7 for the creditable service and the employee's salary rate 8 on the effective date of participation for that employer, 9 plus interest at the effective rate from the date of the 10 prior service to the date of payment. Application for 11 this creditable service may be made at any time while the 12 employee is still in service. 13 Any person who has withdrawn from the service of a 14 participating municipality or participating 15 instrumentality prior to the effective date, who reenters 16 the service of the same municipality or participating 17 instrumentality after the effective date and becomes a 18 participating employee is entitled to creditable service 19 for prior service as otherwise provided in this 20 subdivision (a)(1) only if he or she renders 2 years of 21 service as a participating employee after the effective 22 date. Application for such service must be made while in 23 a participating status. The salary rate to be used in 24 the calculation of the required employee contribution, if 25 any, shall be the employee's salary rate at the time of 26 first reentering service with the employer after the 27 employer's effective date of participation. 28 2. For current service, each participating employee 29 shall be credited with: 30 a. Additional credits of amounts equal to each 31 payment of additional contributions received from 32 him under Section 7-173, as of the date the 33 corresponding payment of earnings is payable to him. 34 b. Normal credits of amounts equal to each -3- LRB9208071LDmb 1 payment of normal contributions received from him, 2 as of the date the corresponding payment of earnings 3 is payable to him, and normal contributions made for 4 the purpose of establishing out-of-state service 5 credits as permitted under the conditions set forth 6 in paragraph 6 of this subsection (a). 7 c. Municipality credits in an amount equal to 8 1.4 times the normal credits, except those 9 established by out-of-state service credits, as of 10 the date of computation of any benefit if these 11 credits would increase the benefit. 12 d. Survivor credits equal to each payment of 13 survivor contributions received from the 14 participating employee as of the date the 15 corresponding payment of earnings is payable, and 16 survivor contributions made for the purpose of 17 establishing out-of-state service credits. 18 3. For periods of temporary and total and permanent 19 disability benefits, each employee receiving disability 20 benefits shall be granted creditable service for the 21 period during which disability benefits are payable. 22 Normal and survivor credits, based upon the rate of 23 earnings applied for disability benefits, shall also be 24 granted if such credits would result in a higher benefit 25 to any such employee or his beneficiary. 26 4. For authorized leave of absence without pay: A 27 participating employee shall be granted credits and 28 creditable service for periods of authorized leave of 29 absence without pay under the following conditions: 30 a. An application for credits and creditable 31 service is submitted to the board while the employee 32 is in a status of active employment, and within 2 33 years after termination of the leave of absence 34 period for which credits and creditable service are -4- LRB9208071LDmb 1 sought. 2 b. Not more than 12 complete months of 3 creditable service for authorized leave of absence 4 without pay shall be counted for purposes of 5 determining any benefits payable under this Article. 6 c. Credits and creditable service shall be 7 granted for leave of absence only if such leave is 8 approved by the governing body of the municipality, 9 including approval of the estimated cost thereof to 10 the municipality as determined by the fund, and 11 employee contributions, plus interest at the 12 effective rate applicable for each year from the end 13 of the period of leave to date of payment, have been 14 paid to the fund in accordance with Section 7-173. 15 The contributions shall be computed upon the 16 assumption earnings continued during the period of 17 leave at the rate in effect when the leave began. 18 d. Benefits under the provisions of Sections 19 7-141, 7-146, 7-150 and 7-163 shall become payable 20 to employees on authorized leave of absence, or 21 their designated beneficiary, only if such leave of 22 absence is creditable hereunder, and if the employee 23 has at least one year of creditable service other 24 than the service granted for leave of absence. Any 25 employee contributions due may be deducted from any 26 benefits payable. 27 e. No credits or creditable service shall be 28 allowed for leave of absence without pay during any 29 period of prior service. 30 5. For military service: The governing body of a 31 municipality or participating instrumentality may elect 32 to allow creditable service to participating employees 33 who leave their employment to serve in the armed forces 34 of the United States for all periods of such service, -5- LRB9208071LDmb 1 provided that the person returns to active employment 2 within 90 days after completion of full time active duty, 3 but no creditable service shall be allowed such person 4 for any period that can be used in the computation of a 5 pension or any other pay or benefit, other than pay for 6 active duty, for service in any branch of the armed 7 forces of the United States. If necessary to the 8 computation of any benefit, the board shall establish 9 municipality credits for participating employees under 10 this paragraph on the assumption that the employee 11 received earnings at the rate received at the time he 12 left the employment to enter the armed forces. A 13 participating employee in the armed forces shall not be 14 considered an employee during such period of service and 15 no additional death and no disability benefits are 16 payable for death or disability during such period. 17 Any participating employee who left his employment 18 with a municipality or participating instrumentality to 19 serve in the armed forces of the United States and who 20 again became a participating employee within 90 days 21 after completion of full time active duty by entering the 22 service of a different municipality or participating 23 instrumentality, which has elected to allow creditable 24 service for periods of military service under the 25 preceding paragraph, shall also be allowed creditable 26 service for his period of military service on the same 27 terms that would apply if he had been employed, before 28 entering military service, by the municipality or 29 instrumentality which employed him after he left the 30 military service and the employer costs arising in 31 relation to such grant of creditable service shall be 32 charged to and paid by that municipality or 33 instrumentality. 34 Notwithstanding the foregoing, any participating -6- LRB9208071LDmb 1 employee shall be entitled to creditable service as 2 required by any federal law relating to re-employment 3 rights of persons who served in the United States Armed 4 Services. Such creditable service shall be granted upon 5 payment by the member of an amount equal to the employee 6 contributions which would have been required had the 7 employee continued in service at the same rate of 8 earnings during the military leave period, plus interest 9 at the effective rate. 10 5.1. In addition to any creditable service 11 established under paragraph 5 of this subsection (a), 12 creditable service may be granted for up to 24 months of 13 service in the armed forces of the United States. 14 In order to receive creditable service for military 15 service under this paragraph 5.1, a participating 16 employee must (1) apply to the Fund in writing and 17 provide evidence of the military service that is 18 satisfactory to the Board; (2) obtain the written 19 approval of the current employer; and (3) make 20 contributions to the Fund equal to (i) the employee 21 contributions that would have been required had the 22 service been rendered as a member, plus (ii) an amount 23 determined by the board to be equal to the employer's 24 normal cost of the benefits accrued for that military 25 service, plus (iii) interest on items (i) and (ii) from 26 the date of first membership in the Fund to the date of 27 payment. If payment is made during the 6-month period 28 that begins 3 months after the effective date of this 29 amendatory Act of 1997, the required interest shall be at 30 the rate of 2.5% per year, compounded annually; 31 otherwise, the required interest shall be calculated at 32 the regular interest rate. 33 6. For out-of-state service: Creditable service 34 shall be granted for service rendered to an out-of-state -7- LRB9208071LDmb 1 local governmental body under the following conditions: 2 The employee had participated and has irrevocably 3 forfeited all rights to benefits in the out-of-state 4 public employees pension system; the governing body of 5 his participating municipality or instrumentality 6 authorizes the employee to establish such service; the 7 employee has 2 years current service with this 8 municipality or participating instrumentality; the 9 employee makes a payment of contributions, which shall be 10 computed at 8% (normal) plus 2% (survivor) times length 11 of service purchased times the average rate of earnings 12 for the first 2 years of service with the municipality or 13 participating instrumentality whose governing body 14 authorizes the service established plus interest at the 15 effective rate on the date such credits are established, 16 payable from the date the employee completes the required 17 2 years of current service to date of payment. In no 18 case shall more than 120 months of creditable service be 19 granted under this provision. 20 7. For retroactive service: Any employee who could 21 have but did not elect to become a participating 22 employee, or who should have been a participant in the 23 Municipal Public Utilities Annuity and Benefit Fund 24 before that fund was superseded, may receive creditable 25 service for the period of service not to exceed 50 26 months; however, a current or former elected or appointed 27 official of a participating municipalitycounty board28membermay establish credit under this paragraph 7 for 29 more than 50 months of service as an official of that 30 municipality,a member of the county boardif the excess 31 over 50 months is approved by resolution of the governing 32 body of the affected municipalitycounty boardfiled with 33 the Fund before January 1, 20031999. 34 Any employee who is a participating employee on or -8- LRB9208071LDmb 1 after September 24, 1981 and who was excluded from 2 participation by the age restrictions removed by Public 3 Act 82-596 may receive creditable service for the period, 4 on or after January 1, 1979, excluded by the age 5 restriction and, in addition, if the governing body of 6 the participating municipality or participating 7 instrumentality elects to allow creditable service for 8 all employees excluded by the age restriction prior to 9 January 1, 1979, for service during the period prior to 10 that date excluded by the age restriction. Any employee 11 who was excluded from participation by the age 12 restriction removed by Public Act 82-596 and who is not a 13 participating employee on or after September 24, 1981 may 14 receive creditable service for service after January 1, 15 1979. Creditable service under this paragraph shall be 16 granted upon payment of the employee contributions which 17 would have been required had he participated, with 18 interest at the effective rate for each year from the end 19 of the period of service established to date of payment. 20 8. For accumulated unused sick leave: A 21 participating employee who is applying for a retirement 22 annuity shall be entitled to creditable service for that 23 portion of the employee's accumulated unused sick leave 24 for which payment is not received, as follows: 25 a. Sick leave days shall be limited to those 26 accumulated under a sick leave plan established by a 27 participating municipality or participating 28 instrumentality which is available to all employees 29 or a class of employees. 30 b. Only sick leave days accumulated with a 31 participating municipality or participating 32 instrumentality with which the employee was in 33 service within 60 days of the effective date of his 34 retirement annuity shall be credited; If the -9- LRB9208071LDmb 1 employee was in service with more than one employer 2 during this period only the sick leave days with the 3 employer with which the employee has the greatest 4 number of unpaid sick leave days shall be 5 considered. 6 c. The creditable service granted shall be 7 considered solely for the purpose of computing the 8 amount of the retirement annuity and shall not be 9 used to establish any minimum service period 10 required by any provision of the Illinois Pension 11 Code, the effective date of the retirement annuity, 12 or the final rate of earnings. 13 d. The creditable service shall be at the rate 14 of 1/20 of a month for each full sick day, provided 15 that no more than 12 months may be credited under 16 this subdivision 8. 17 e. Employee contributions shall not be 18 required for creditable service under this 19 subdivision 8. 20 f. Each participating municipality and 21 participating instrumentality with which an employee 22 has service within 60 days of the effective date of 23 his retirement annuity shall certify to the board 24 the number of accumulated unpaid sick leave days 25 credited to the employee at the time of termination 26 of service. 27 9. For service transferred from another system: 28 Credits and creditable service shall be granted for 29 service under Article 3, 4, 5, 14 or 16 of this Act, to 30 any active member of this Fund, and to any inactive 31 member who has been a county sheriff, upon transfer of 32 such credits pursuant to Section 3-110.3, 4-108.3, 5-235, 33 14-105.6 or 16-131.4, and payment by the member of the 34 amount by which (1) the employer and employee -10- LRB9208071LDmb 1 contributions that would have been required if he had 2 participated in this Fund as a sheriff's law enforcement 3 employee during the period for which credit is being 4 transferred, plus interest thereon at the effective rate 5 for each year, compounded annually, from the date of 6 termination of the service for which credit is being 7 transferred to the date of payment, exceeds (2) the 8 amount actually transferred to the Fund. Such transferred 9 service shall be deemed to be service as a sheriff's law 10 enforcement employee for the purposes of Section 7-142.1. 11 (b) Creditable service - amount: 12 1. One month of creditable service shall be allowed 13 for each month for which a participating employee made 14 contributions as required under Section 7-173, or for 15 which creditable service is otherwise granted hereunder. 16 Not more than 1 month of service shall be credited and 17 counted for 1 calendar month, and not more than 1 year of 18 service shall be credited and counted for any calendar 19 year. A calendar month means a nominal month beginning 20 on the first day thereof, and a calendar year means a 21 year beginning January 1 and ending December 31. 22 2. A seasonal employee shall be given 12 months of 23 creditable service if he renders the number of months of 24 service normally required by the position in a 12-month 25 period and he remains in service for the entire 12-month 26 period. Otherwise a fractional year of service in the 27 number of months of service rendered shall be credited. 28 3. An intermittent employee shall be given 29 creditable service for only those months in which a 30 contribution is made under Section 7-173. 31 (c) No application for correction of credits or 32 creditable service shall be considered unless the board 33 receives an application for correction while (1) the 34 applicant is a participating employee and in active -11- LRB9208071LDmb 1 employment with a participating municipality or 2 instrumentality, or (2) while the applicant is actively 3 participating in a pension fund or retirement system which is 4 a participating system under the Retirement Systems 5 Reciprocal Act. A participating employee or other applicant 6 shall not be entitled to credits or creditable service unless 7 the required employee contributions are made in a lump sum or 8 in installments made in accordance with board rule. 9 (d) Upon the granting of a retirement, surviving spouse 10 or child annuity, a death benefit or a separation benefit, on 11 account of any employee, all individual accumulated credits 12 shall thereupon terminate. Upon the withdrawal of additional 13 contributions, the credits applicable thereto shall thereupon 14 terminate. Terminated credits shall not be applied to 15 increase the benefits any remaining employee would otherwise 16 receive under this Article. 17 (Source: P.A. 90-448, eff. 8-16-97; 91-887, eff. 7-6-00.) 18 Section 99. Effective date. This Act takes effect upon 19 becoming law.