Public Act 093-0933
Public Act 0933 93RD GENERAL ASSEMBLY
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Public Act 093-0933
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| HB0587 Enrolled |
LRB093 05661 EFG 05754 b |
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| AN ACT in relation to pensions.
| Be it enacted by the People of the State of Illinois, | represented in the General Assembly:
| Section 5. The Illinois Pension Code is amended by changing | Sections 7-137 and 7-139 as follows:
| (40 ILCS 5/7-137) (from Ch. 108 1/2, par. 7-137)
| Sec. 7-137. Participating and covered employees.
| (a) The persons described in this paragraph (a) shall be | included within
and be subject to this Article and eligible to | benefits from this fund,
beginning upon the dates hereinafter | specified:
| 1. Except as to the employees specifically excluded | under the
provisions of this Article, all persons who are | employees of any
municipality (or instrumentality thereof) | or participating
instrumentality on the effective date of | participation of the
municipality or participating | instrumentality beginning upon such
effective date.
| 2. Except as to the employees specifically excluded | under the
provisions of this Article, all persons, who | became employees of any
participating municipality (or | instrumentality thereof) or participating
instrumentality | after the effective date of participation of such
| municipality or participating instrumentality, beginning | upon the date
such person becomes an employee.
| 3. All persons who file notice with the board as | provided in
paragraph (b) 2 and 3 of this Section, | beginning upon the date of filing
such notice.
| (b) The following described persons shall not be considered
| participating employees eligible for benefits from this fund, | but shall
be included within and be subject to this Article | (each of the
descriptions is not exclusive but is cumulative):
| 1. Any person who occupies an office or is employed in |
| a position
normally requiring performance of duty during | less than 600 hours a year
for a municipality (including | all instrumentalities thereof) or a
participating | instrumentality. If a school treasurer performs services
| for more than one school district, the total number of | hours of service
normally required for the several school | districts shall be considered
to determine whether he | qualifies under this paragraph;
| 2. Any person who holds elective office unless he has | elected while
in that office in a written notice on file | with the board to become a
participating employee;
| 3. Any person working for a city hospital unless any | such person,
while in active employment, has elected in a | written notice on file with
the board to become a | participating employee and notification thereof is
| received by the board;
| 4. Any person who becomes an employee after June 30, | 1979 as a public
service employment program participant | under the federal Comprehensive
Employment and Training | Act and whose wages or fringe benefits are paid in
whole or | in part by funds provided under such Act; .
| 5. Any person who is actively employed by a | municipality on its effective date of participation in the | Fund if that municipality (i) has at least 35 employees on | its effective date of participation; (ii) is located in a | county with at least 2,000,000 inhabitants; and (iii) | maintains an independent defined benefit pension plan for | the benefit of its eligible employees, unless the person | files with the board within 90 days after the | municipality's effective date of participation an | irrevocable election to participate.
| (c) Any person electing to be a participating employee, | pursuant to
paragraph (b) of this Section may not change such | election,
except as provided in Section 7-137.1.
| (d) Any employee who occupied the position of school nurse | in any
participating municipality on August 8, 1961 and |
| continuously thereafter
until the effective date of the | exercise of the option authorized by
this subparagraph, who on | August 7, 1961 was a member of the Teachers'
Retirement System | of Illinois, by virtue of certification by the
Department of | Registration and Education as a public health nurse, may
elect | to terminate participation in this Fund in order to | re-establish
membership in such System. The election may be | exercised by filing
written notice thereof with the Board or | with the Board of Trustees of
said Teachers' Retirement System, | not later than September 30, 1963, and
shall be effective on | the first day of the calendar month next following
the month in | which the notice was filed. If the written notice is filed
with | such Teachers' Retirement System, that System shall | immediately
notify this Fund, but neither failure nor delay in | notification shall
affect the validity of the employee's | election. If the option is
exercised, the Fund shall notify | such Teachers' Retirement System of
such fact and transfer to | that system the amounts contributed by the
employee to this | Fund, including interest at 3% per annum, but excluding
| contributions applicable to social security coverage during | the period
beginning August 8, 1961 to the effective date of | the employee's
election. Participation in this Fund as to any | credits on or after
August 8, 1961 and up to the effective date | of the employee's election
shall terminate on such effective | date.
| (e) Any participating municipality or participating | instrumentality,
other than a school district or special | education joint agreement created
under Section 10-22.31 of the | School Code, may, by a resolution or
ordinance duly adopted by | its governing body, elect to exclude from
participation and | eligibility for benefits all persons who are employed
after the | effective date of such resolution or ordinance and who occupy | an
office or are employed in a position normally requiring | performance of duty
for less than 1000 hours per year for the | participating municipality
(including all instrumentalities | thereof) or participating instrumentality
except for persons |
| employed in a position normally requiring performance of
duty | for 600 hours or more per year (i) by such participating | municipality
or participating instrumentality prior to the | effective date of the
resolution or ordinance, (ii) by any | participating municipality or
participating instrumentality | prior to January 1, 1982 and (iii) by a
participating | municipality or participating instrumentality, which had not
| adopted such a resolution when the person was employed, and the | function
served by the employee's position is assumed by | another participating
municipality or participating | instrumentality. A participating municipality or
participating | instrumentality included in and subject to this Article after
| January 1, 1982 may adopt such resolution or ordinance only | prior to the
date it becomes included in and subject to this | Article. Notwithstanding
the foregoing, a participating | municipality or participating
instrumentality which is formed | solely to succeed to the functions of a
participating | municipality or participating instrumentality shall be
| considered to have adopted any such resolution or ordinance | which may have
been applicable to the employees performing such | functions. The election
made by the resolution or ordinance | shall take effect at the time specified
in the resolution or | ordinance, and once effective shall be irrevocable.
| (Source: P.A. 86-272; 87-740; 87-850.)
| (40 ILCS 5/7-139) (from Ch. 108 1/2, par. 7-139)
| Sec. 7-139. Credits and creditable service to employees.
| (a) Each participating employee shall be granted credits | and creditable
service, for purposes of determining the amount | of any annuity or benefit
to which he or a beneficiary is | entitled, as follows:
| 1. For prior service: Each participating employee who | is an employee
of a participating municipality or | participating instrumentality on the
effective date shall | be granted creditable service, but no credits under
| paragraph 2 of this subsection (a), for periods of prior |
| service for which
credit has not been received under any | other pension fund or retirement system
established under | this Code, as follows:
| If the effective date of participation for the | participating municipality
or participating | instrumentality is on or before January 1, 1998, creditable
| service shall be granted for the entire period of prior | service with that
employer without any employee | contribution.
| If the effective date of participation for the | participating municipality
or participating | instrumentality is after January 1, 1998, creditable
| service shall be granted for the last 20% of the period of | prior service with
that employer, but no more than 5 years, | without any employee contribution. A
participating | employee may establish creditable service for the | remainder of
the period of prior service with that employer | by making an application in
writing, accompanied by payment | of an employee contribution in an
amount determined by the | Fund, based on the employee contribution rates in
effect at | the time of application for the creditable service and the | employee's
salary rate on the effective date of | participation for that employer, plus
interest at the | effective rate from the date of the prior service to the | date
of payment. Application for this creditable service | may be made at any time
while the employee is still in | service.
| A municipality that (i) has at least 35 employees; (ii) | is located in a county with at least 2,000,000 inhabitants; | and (iii) maintains an independent defined benefit pension | plan for the benefit of its eligible employees may restrict | creditable service in whole or in part for periods of prior | service with the employer if the governing body of the | municipality adopts an irrevocable resolution to restrict | that creditable service and files the resolution with the | board before the municipality's effective date of |
| participation.
| Any person who has withdrawn from the service of a | participating
municipality
or participating | instrumentality prior to the effective date, who reenters
| the service of the same municipality or participating | instrumentality after
the effective date and becomes a | participating employee is entitled to
creditable service | for prior service as otherwise provided in this
subdivision | (a)(1) only if he or she renders 2 years of service as a
| participating employee after the effective date. | Application
for such service must be made while in a | participating status.
The salary rate to be used in the | calculation of the required employee
contribution, if any, | shall be the employee's salary rate at the time of first
| reentering service with the employer after the employer's | effective date of
participation.
| 2. For current service, each participating employee | shall be
credited with:
| a. Additional credits of amounts equal to each | payment of additional
contributions received from him | under Section 7-173, as of the
date the corresponding | payment of earnings is payable to him.
| b. Normal credits of amounts equal to each payment | of normal
contributions received from him, as of the | date the corresponding payment of
earnings is payable | to him, and normal contributions made for the purpose | of
establishing out-of-state service credits as | permitted under the conditions set
forth in paragraph 6 | of this subsection (a).
| c. Municipality credits in an amount equal to 1.4 | times the normal
credits, except those established by | out-of-state service credits, as of
the date of | computation of any benefit if these credits would | increase
the benefit.
| d. Survivor credits equal to each payment of | survivor contributions
received from the participating |
| employee as of the date the
corresponding payment of | earnings is payable, and survivor contributions made
| for the purpose of establishing out-of-state service | credits.
| 3. For periods of temporary and total and permanent | disability
benefits, each employee receiving disability | benefits shall be granted
creditable service for the period | during which disability benefits are
payable. Normal and | survivor credits, based upon the rate of earnings
applied | for disability benefits, shall also be granted if such | credits
would result in a higher benefit to any such | employee or his
beneficiary.
| 4. For authorized leave of absence without pay: A | participating
employee shall be granted credits and | creditable service for periods of
authorized leave of | absence without pay under the following
conditions:
| a. An application for credits and creditable | service is submitted to the
board while the employee is | in a status of
active employment, and within 2 years | after termination of the
leave of absence period for | which credits and creditable service are
sought.
| b. Not more than 12 complete months of creditable | service
for authorized leave of absence without pay | shall be counted for purposes of
determining any | benefits payable under this Article.
| c. Credits and creditable service shall be granted | for leave of
absence only if such leave is approved by | the governing body of the
municipality, including | approval of the estimated cost thereof to the
| municipality as determined by the fund, and employee | contributions, plus
interest at the effective rate | applicable for each year from the end of
the period of | leave to date of payment, have been paid to the fund in
| accordance with Section 7-173. The contributions shall | be computed upon the
assumption earnings continued | during the period of leave at the rate in
effect when |
| the leave began.
| d. Benefits under the provisions of Sections | 7-141, 7-146, 7-150
and 7-163 shall become payable to | employees on authorized leave of
absence, or their | designated beneficiary, only if such leave of absence
| is creditable hereunder, and if the employee has at | least one year of
creditable service other than the | service granted for leave of absence.
Any employee | contributions due may be deducted from any benefits
| payable.
| e. No credits or creditable service shall be | allowed for leave of
absence without pay during any | period of prior service.
| 5. For military service: The governing body of a | municipality or
participating instrumentality may elect to | allow creditable service to
participating employees who | leave their employment to serve in the armed
forces of the | United States for all periods of such service, provided
| that the person returns to active employment within 90 days | after
completion
of full time active duty, but no | creditable service shall be allowed such
person for any | period that can be used in the computation of a pension
or | any other pay or benefit, other than pay for active duty, | for service
in any branch of the armed forces of the United | States. If necessary to
the computation of any benefit, the | board shall establish municipality
credits for | participating employees under this paragraph on the
| assumption that the employee received earnings at the rate | received at
the time he left the employment to enter the | armed forces. A
participating employee in the armed forces | shall not be considered an
employee during such period of | service and no additional death and no
disability benefits | are payable for death or disability during such period.
| Any participating employee who left his employment | with a
municipality or participating instrumentality to | serve in the armed
forces of the United States and who |
| again became a participating
employee within 90 days after | completion of full time active duty by
entering the service | of a different municipality or participating
| instrumentality, which has elected to allow creditable | service for
periods of military service under the preceding | paragraph, shall also be
allowed creditable service for his | period of military service on the
same terms that would | apply if he had been employed, before entering
military | service, by the municipality or instrumentality which | employed
him after he left the military service and the | employer costs arising in
relation to such grant of | creditable service shall be charged to and
paid by that | municipality or instrumentality.
| Notwithstanding the foregoing, any participating | employee
shall be entitled to creditable service as | required by any federal law
relating to re-employment | rights of persons who served in the United States
Armed | Services. Such creditable service shall be granted upon | payment by
the member of an amount equal to the employee | contributions which would
have been required had the | employee continued in service at the same
rate of earnings | during the military leave period, plus interest at
the | effective rate.
| 5.1. In addition to any creditable service established | under
paragraph 5 of this subsection (a), creditable | service may be granted for
up to 24 months of service in | the armed forces of the United States.
| In order to receive creditable service for military | service under this
paragraph 5.1, a participating employee | must (1) apply to the Fund
in writing and provide evidence | of the military service that is satisfactory
to the Board; | (2) obtain the written approval of the current employer; | and (3)
make contributions to the Fund equal to (i)
the | employee contributions that would have been required had | the service been
rendered as a member, plus (ii) an amount | determined by the board to be equal
to the employer's |
| normal cost of the benefits accrued for that military
| service, plus (iii) interest on items (i) and (ii) from the | date of first
membership in the Fund to the date of | payment. If payment is made during
the 6-month period that | begins 3 months after the effective date of this
amendatory | Act of 1997, the required interest shall be at the rate of | 2.5%
per year, compounded annually; otherwise, the | required interest shall be
calculated at the regular | interest rate.
| 6. For out-of-state service: Creditable service shall | be granted for
service rendered to an out-of-state local | governmental body under the
following conditions: The | employee had participated and has irrevocably
forfeited | all rights to benefits in the out-of-state public employees
| pension system; the governing body of his participating | municipality or
instrumentality authorizes the employee to | establish such service; the
employee has 2 years current | service with this municipality or
participating | instrumentality; the employee makes a payment of
| contributions, which shall be computed at 8% (normal) plus | 2% (survivor)
times length of service purchased times the | average rate of earnings for the
first 2
years of service | with the municipality or participating
instrumentality | whose governing body authorizes the service established
| plus interest at the effective rate on the date such | credits are
established, payable from the date the employee | completes the required 2
years of current service to date | of payment. In no case shall more than
120 months of | creditable service be granted under this provision.
| 7. For retroactive service: Any employee who could have | but did not
elect to become a participating employee, or | who should have been a
participant in the Municipal Public | Utilities Annuity and Benefit Fund
before that fund was | superseded, may receive creditable service for the
period | of service not to exceed 50 months; however, a current or | former
elected or appointed official of a participating |
| municipality may establish credit under this paragraph 7 | for more than 50
months of service as an official of that | municipality, if the excess over 50 months is approved by | resolution of the
governing body of the affected | municipality filed with
the Fund before January 1, 2002.
| Any employee who is a
participating employee on or | after September 24, 1981 and who was
excluded from | participation by the age restrictions removed by Public Act
| 82-596 may receive creditable service for the period, on or | after January
1, 1979, excluded by the age restriction and, | in addition, if the governing
body of the participating | municipality or participating instrumentality elects
to | allow creditable service for all employees excluded by the | age restriction
prior to January 1, 1979, for service | during the period prior to that date
excluded by the age | restriction. Any employee who was excluded from
| participation by the age restriction removed by Public Act | 82-596 and who is
not a participating employee on or after | September 24, 1981 may receive
creditable service for | service after January 1,
1979. Creditable service under | this paragraph
shall be granted upon payment of the | employee contributions
which would have been required had | he participated, with interest at the
effective rate for | each year from the end of the period of service
established | to date of payment.
| 8. For accumulated unused sick leave: A participating | employee who is
applying for a retirement annuity shall be | entitled to creditable service
for that portion of the | employee's accumulated unused sick leave
for which payment | is not received, as follows:
| a. Sick leave days shall be limited to those | accumulated under a sick
leave plan established by a | participating municipality or participating
| instrumentality which is available to all employees or | a class of employees.
| b. Only sick leave days accumulated with a |
| participating municipality or
participating | instrumentality with which the employee was in service | within
60 days of the effective date of his retirement | annuity shall be credited;
If the employee was in | service with more than one employer during this
period | only the sick leave days with the employer with which | the employee
has the greatest number of unpaid sick | leave days shall be considered.
| c. The creditable service granted shall be | considered solely for the
purpose of computing the | amount of the retirement annuity and shall not be
used | to establish any minimum service period required by any | provision of the
Illinois Pension Code, the effective | date of the retirement annuity, or the
final rate of | earnings.
| d. The creditable service shall be at the rate of | 1/20 of a month for
each full sick day, provided that | no more than 12 months may be credited
under this | subdivision 8.
| e. Employee contributions shall not be required | for creditable service
under this subdivision 8.
| f. Each participating municipality and | participating instrumentality
with which an employee | has service within 60 days of the effective date of
his | retirement annuity shall certify to the board the | number of accumulated
unpaid sick leave days credited | to the employee at the time of termination
of service.
| 9. For service transferred from another system: | Credits and
creditable service shall be granted for service | under Article 3, 4, 5, 14
or 16 of this Act, to any active | member of this Fund, and to any
inactive member who has | been a county sheriff, upon
transfer of such credits | pursuant to Section 3-110.3, 4-108.3, 5-235,
14-105.6 or | 16-131.4, and payment by the member of the amount by
which | (1) the employer and employee contributions that would have | been required
if he had participated in this Fund as a |
| sheriff's law enforcement employee
during the period for | which credit is
being transferred, plus interest thereon at | the effective rate for each
year, compounded annually, from | the date of termination of the service for
which credit is | being transferred to the date of payment, exceeds (2) the
| amount actually transferred to the Fund.
Such transferred | service shall be deemed to be service as a sheriff's law
| enforcement employee for the purposes of Section 7-142.1.
| (b) Creditable service - amount:
| 1. One month of creditable service
shall be allowed for | each month for which a participating employee made
| contributions as required under Section 7-173, or for which | creditable
service is otherwise granted hereunder. Not | more than 1 month of
service shall be credited and counted | for 1 calendar month, and not more
than 1 year of service | shall be credited and counted for any calendar
year. A | calendar month means a nominal month beginning on the first | day
thereof, and a calendar year means a year beginning | January 1 and ending
December 31.
| 2. A seasonal employee shall be given 12 months of | creditable
service if he renders the number of months of | service normally required
by the position in a 12-month | period and he remains in service for the
entire 12-month | period. Otherwise a fractional year of service in the
| number of months of service rendered shall be credited.
| 3. An intermittent employee shall be given creditable | service for
only those months in which a contribution is | made under Section 7-173.
| (c) No application for correction of credits or creditable | service shall
be considered unless the board receives an | application for correction while
(1) the applicant is a | participating employee and in active employment
with a | participating municipality or instrumentality, or (2) while | the
applicant is actively participating in a pension fund or | retirement
system which is a participating system under the | Retirement Systems
Reciprocal Act. A participating employee or |
| other applicant shall not be
entitled to credits or creditable | service unless the required employee
contributions are made in | a lump sum or in installments made in accordance
with board | rule.
| (d) Upon the granting of a retirement, surviving spouse or | child
annuity, a death benefit or a separation benefit, on | account of any
employee, all individual accumulated credits | shall thereupon terminate.
Upon the withdrawal of additional | contributions, the credits applicable
thereto shall thereupon | terminate. Terminated credits shall not be applied
to increase | the benefits any remaining employee would otherwise receive | under
this Article.
| (Source: P.A. 91-887, eff. 7-6-00; 92-424, eff. 8-17-01.)
| Section 99. Effective date. This Act takes effect upon | becoming law.
|
Effective Date: 8/13/2004
|
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