Public Act 096-0299
Public Act 0299 96TH GENERAL ASSEMBLY
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Public Act 096-0299
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| HB3672 Enrolled |
LRB096 11589 AMC 22077 b |
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| AN ACT concerning public employee benefits.
| 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 | Section 7-139 as follows:
| (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 48 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. The required interest shall be
calculated at the | regular interest rate.
| The changes made to this paragraph 5.1 by Public Acts | 95-483 and 95-486
apply only to participating employees in | service on or after August 28, 2007 (the effective date of | those Public Acts).
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| 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.
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| 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. Except as provided in item b-1, only 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.
| b-1. If the employee was in the service of more | than one employer as defined in item (2) of paragraph | (a) of subsection (A) of Section 7-132, then the sick | leave days from all such employers shall be credited, | as long as the creditable service attributed to those | sick leave days does not exceed the limitation in item |
| f of this paragraph 8. In calculating the creditable | service under this item b-1, the sick leave days from | the last employer shall be considered first, then the | remaining sick leave days shall be considered until | there are no more days or the maximum creditable sick | leave threshold under item f of this paragraph 8 has | been reached.
| 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.
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| 9. For service transferred from another system: | Credits and
creditable service shall be granted for service | under Article 3, 4, 5, 8, 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,
8-226.7,
| 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.
| 10. For service transferred from an Article 3 system | under Section 3-110.8: Credits and
creditable service | shall be granted for service under Article 3 of this Act as | provided in Section 3-110.8, to any active member of this | Fund upon
transfer of such credits pursuant to Section | 3-110.8. If the amount by
which (1) the employer and | employee contributions that would have been required
if he | had participated in this Fund 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, then the amount of | creditable service established under this paragraph 10 | shall be reduced by a corresponding amount in accordance | with the rules and procedures established under this | paragraph 10.
| The board shall establish by rule the manner of making | the calculation required under
this paragraph 10, taking | into account the appropriate actuarial
assumptions; the | member's service, age, and salary history; the level
of | funding of the employer; and
any other factors that the | board determines to be relevant.
| Until January 1, 2010, members who transferred service | from an Article 3 system under the provisions of Public Act | 94-356 may establish additional credit in this Fund, but | only up to the amount of the service credit reduction in | that transfer, as calculated under the actuarial | assumptions. This credit may be established upon payment by | the member of an amount to be determined by the board, | equal to (1) the amount that would have been contributed as | employee and employer contributions had all the service | been as an employee under this Article, plus interest | thereon compounded annually from the date of service to the |
| date of transfer, less (2) the total amount transferred | from the Article 3 system, plus (3) interest on the | difference at the effective rate for each year, compounded | annually, from the date of the transfer to the date of | payment. The additional service credit is allowed under | this amendatory Act of the 95th General Assembly | notwithstanding the provisions of Article 3 terminating | all transferred credits on the date of transfer. | (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. 95-483, eff. 8-28-07; 95-486, eff. 8-28-07; | 95-504, eff. 8-28-07; 95-812, eff. 8-13-08; 95-876, eff. | 8-21-08.)
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| Section 90. The State Mandates Act is amended by adding | Section 8.33 as follows:
| (30 ILCS 805/8.33 new) | Sec. 8.33. Exempt mandate. Notwithstanding Sections 6 and 8 | of this Act, no reimbursement by the State is required for the | implementation of any mandate created by this amendatory Act of | the 96th General Assembly.
| Section 99. Effective date. This Act takes effect upon | becoming law.
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Effective Date: 8/11/2009
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