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92_SB1020 LRB9208135EGfg 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 3-110 as follows: 6 (40 ILCS 5/3-110) (from Ch. 108 1/2, par. 3-110) 7 Sec. 3-110. Creditable service. 8 (a) "Creditable service" is the time served by a police 9 officer as a member of a regularly constituted police force 10 of a municipality. In computing creditable service furloughs 11 without pay exceeding 30 days shall not be counted, but all 12 leaves of absence for illness or accident, regardless of 13 length, and all periods of disability retirement for which a 14 police officer has received no disability pension payments 15 under this Article shall be counted. 16 (a-5) Up to 3 years of time during which the police 17 officer receives a disability pension under Section 3-114.1, 18 3-114.2, 3-114.3, or 3-114.6 shall be counted as creditable 19 service, provided that (i) the police officer returns to 20 active service after the disability for a period at least 21 equal to the period for which credit is to be established and 22 (ii) the police officer makes contributions to the fund based 23 on the rates specified in Section 3-125.1 and the salary upon 24 which the disability pension is based. These contributions 25 may be paid at any time prior to the commencement of a 26 retirement pension. The police officer may, but need not, 27 elect to have the contributions deducted from the disability 28 pension or to pay them in installments on a schedule approved 29 by the board. If not deducted from the disability pension, 30 the contributions shall include interest at the rate of 6% 31 per year, compounded annually, from the date for which -2- LRB9208135EGfg 1 service credit is being established to the date of payment. 2 If contributions are paid under this subsection (a-5) in 3 excess of those needed to establish the credit, the excess 4 shall be refunded. This subsection (a-5) applies to persons 5 receiving a disability pension under Section 3-114.1, 6 3-114.2, 3-114.3, or 3-114.6 on the effective date of this 7 amendatory Act of the 91st General Assembly, as well as 8 persons who begin to receive such a disability pension after 9 that date. 10 (b) Creditable service includes all periods of service 11 in the military, naval or air forces of the United States 12 entered upon while an active police officer of a 13 municipality, provided that upon applying for a permanent 14 pension, and in accordance with the rules of the board, the 15 police officer pays into the fund the amount the officer 16 would have contributed if he or she had been a regular 17 contributor during such period, to the extent that the 18 municipality which the police officer served has not made 19 such contributions in the officer's behalf. The total amount 20 of such creditable service shall not exceed 5 years, except 21 that any police officer who on July 1, 1973 had more than 5 22 years of such creditable service shall receive the total 23 amount thereof. 24 (b-1) In addition to any creditable service established 25 under subsection (b), creditable service may be granted for 26 up to 24 months of service in the armed forces of the United 27 States that was not immediately preceded by employment as a 28 police officer, but only if the governing authority of the 29 municipality has adopted a resolution or ordinance approving 30 the establishment of creditable service under this subsection 31 (b-1) by police officers of the municipality. 32 In order to receive creditable service for military 33 service under this subsection (b-1), a police officer must 34 (1) apply to the Fund in writing and provide evidence of the -3- LRB9208135EGfg 1 military service that is satisfactory to the Board and (2) 2 make contributions to the Fund equal to (i) the employee 3 contributions that would have been required had the service 4 been rendered as a member, plus (ii) an amount determined by 5 the board to be equal to the employer's normal cost of the 6 benefits accrued for that military service, plus (iii) 7 interest on items (i) and (ii) from the date of first 8 membership in the Fund to the date of payment. If payment is 9 made during the 6-month period that begins 3 months after the 10 effective date of this amendatory Act of the 92nd General 11 Assembly, the required interest shall be at the rate of 2.5% 12 per year, compounded annually; otherwise, the required 13 interest shall be calculated at the rate of 6% per year, 14 compounded annually. 15 (c) Creditable service also includes service rendered by 16 a police officer while on leave of absence from a police 17 department to serve as an executive of an organization whose 18 membership consists of members of a police department, 19 subject to the following conditions: (i) the police officer 20 is a participant of a fund established under this Article 21 with at least 10 years of service as a police officer; (ii) 22 the police officer received no credit for such service under 23 any other retirement system, pension fund, or annuity and 24 benefit fund included in this Code; (iii) pursuant to the 25 rules of the board the police officer pays to the fund the 26 amount he or she would have contributed had the officer been 27 an active member of the police department; and (iv) the 28 organization pays a contribution equal to the municipality's 29 normal cost for that period of service. 30 (d)(1) Creditable service also includes periods of 31 service originally established in another police pension 32 fund under this Article or in the Fund established under 33 Article 7 of this Code for which (i) the contributions 34 have been transferred under Section 3-110.7 or Section -4- LRB9208135EGfg 1 7-139.9 and (ii) any additional contribution required 2 under paragraph (2) of this subsection has been paid in 3 full in accordance with the requirements of this 4 subsection (d). 5 (2) If the board of the pension fund to which 6 creditable service and related contributions are 7 transferred under Section 3-110.7 or 7-139.9 determines 8 that the amount transferred is less than the true cost to 9 the pension fund of allowing that creditable service to 10 be established, then in order to establish that 11 creditable service the police officer must pay to the 12 pension fund, within the payment period specified in 13 paragraph (3) of this subsection, an additional 14 contribution equal to the difference, as determined by 15 the board in accordance with the rules and procedures 16 adopted under paragraph (6) of this subsection. 17 (3) Except as provided in paragraph (4), the 18 additional contribution must be paid to the board (i) 19 within 5 years from the date of the transfer of 20 contributions under Section 3-110.7 or 7-139.9 and (ii) 21 before the police officer terminates service with the 22 fund. The additional contribution may be paid in a lump 23 sum or in accordance with a schedule of installment 24 payments authorized by the board. 25 (4) If the police officer dies in service before 26 payment in full has been made and before the expiration 27 of the 5-year payment period, the surviving spouse of the 28 officer may elect to pay the unpaid amount on the 29 officer's behalf within 6 months after the date of death, 30 in which case the creditable service shall be granted as 31 though the deceased police officer had paid the remaining 32 balance on the day before the date of death. 33 (5) If the additional contribution is not paid in 34 full within the required time, the creditable service -5- LRB9208135EGfg 1 shall not be granted and the police officer (or the 2 officer's surviving spouse or estate) shall be entitled 3 to receive a refund of (i) any partial payment of the 4 additional contribution that has been made by the police 5 officer and (ii) those portions of the amounts 6 transferred under subdivision (a)(1) of Section 3-110.7 7 or subdivisions (a)(1) and (a)(3) of Section 7-139.9 that 8 represent employee contributions paid by the police 9 officer (but not the accumulated interest on those 10 contributions) and interest paid by the police officer to 11 the prior pension fund in order to reinstate service 12 terminated by acceptance of a refund. 13 At the time of paying a refund under this item (5), 14 the pension fund shall also repay to the pension fund 15 from which the contributions were transferred under 16 Section 3-110.7 or 7-139.9 the amount originally 17 transferred under subdivision (a)(2) of that Section, 18 plus interest at the rate of 6% per year, compounded 19 annually, from the date of the original transfer to the 20 date of repayment. Amounts repaid to the Article 7 fund 21 under this provision shall be credited to the appropriate 22 municipality. 23 Transferred credit that is not granted due to 24 failure to pay the additional contribution within the 25 required time is lost; it may not be transferred to 26 another pension fund and may not be reinstated in the 27 pension fund from which it was transferred. 28 (6) The Public Employee Pension Fund Division of 29 the Department of Insurance shall establish by rule the 30 manner of making the calculation required under paragraph 31 (2) of this subsection, taking into account the 32 appropriate actuarial assumptions; the police officer's 33 service, age, and salary history; the level of funding of 34 the pension fund to which the credits are being -6- LRB9208135EGfg 1 transferred; and any other factors that the Division 2 determines to be relevant. The rules may require that 3 all calculations made under paragraph (2) be reported to 4 the Division by the board performing the calculation, 5 together with documentation of the creditable service to 6 be transferred, the amounts of contributions and interest 7 to be transferred, the manner in which the calculation 8 was performed, the numbers relied upon in making the 9 calculation, the results of the calculation, and any 10 other information the Division may deem useful. 11 (Source: P.A. 90-460, eff. 8-17-97; 91-887, eff. 7-6-00; 12 91-939, eff. 2-1-01.) 13 Section 99. Effective date. This Act takes effect upon 14 becoming law.
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