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Public Act 098-0042 |
SB1366 Enrolled | LRB098 07062 JDS 37121 b |
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AN ACT concerning public employee benefits.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The Illinois Pension Code is amended by changing |
Sections 16-133.2, 16-152, and 16-176 as follows:
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(40 ILCS 5/16-133.2) (from Ch. 108 1/2, par. 16-133.2)
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Sec. 16-133.2. Early retirement without discount. |
(a) A member
retiring after June 1, 1980 and on or before |
June 30, 2005 (or as provided in subsection (b) of this |
Section), and
applying for a retirement annuity within 6 months |
of the last day of
teaching for which retirement contributions |
were required,
may elect at the time of application for a |
retirement annuity, to make
a one time member contribution to |
the System and thereby
avoid the reduction in the retirement |
annuity for retirement before age
60 specified in paragraph (B) |
of Section 16-133. The exercise of the
election shall also |
obligate the last employer to make a one time
non-refundable |
contribution to the System. Substitute teachers wishing to
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exercise this election must teach 85 or more days in one school |
term with
one employer, who shall be deemed the last employer |
for purposes of this
Section. The last day of teaching with |
that employer must be within 6
months of the date of |
application for retirement. All substitute
teaching credit |
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applied toward the required 85 days must be earned after
June |
30, 1990.
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The one time member and employer contributions shall be a |
percentage of
the retiring member's highest annual salary rate |
used in the determination
of the average salary for retirement |
annuity purposes. However, when
determining the one-time |
member and employer contributions, that part of a
member's |
salary with the same employer which exceeds the annual salary |
rate
for the preceding year by more than 20% shall be excluded. |
The member
contribution shall be at the rate of 7% for the |
lesser of the following 2
periods: (1) for each year that the |
member is less than age 60; or (2) for
each year that the |
member's creditable service is less than 35 years. If a
member |
is at least age 55 and has at least 34 years of creditable |
service, no
member or employer contribution for the early |
retirement option shall be
required. The employer contribution |
shall be at the rate of 20% for each year
the member is under |
age 60.
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Upon receipt of the application and election, the System |
shall determine
the one time employee and employer |
contributions required. The member
contribution shall be |
credited to the individual account of the member and
the |
employer contribution shall be credited to the Benefit Trust |
Reserve. The
provisions of this subsection (a) providing for |
the avoidance of the reduction in retirement annuity shall
not |
be applicable until the member's contribution, if any, has been |
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received
by the System; however, the date such contributions |
are received shall not be
considered in determining the |
effective date of retirement.
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The number of members working for a single employer who may
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retire under this subsection or subsection (b) in any year may |
be limited at the option
of the employer to a specified |
percentage of those eligible, not less
than 30%, with the right |
to participate to be allocated among those
applying on the |
basis of seniority in the service of the employer.
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(b) The provisions of subsection (a) of this Section shall |
remain in effect for a member retiring after June 30, 2005 and |
on or before July 1, 2007, provided that the member satisfies |
both of the following requirements: |
(1) the member notified his or her employer of intent |
to retire under this Article on or before the effective |
date of this amendatory Act of the 94th General Assembly |
under the terms of a contract or collective bargaining |
agreement entered into, amended, or renewed with the |
employer on or before the effective date of this amendatory |
Act of the 94th General Assembly; and
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(2) the effective date of the member's retirement is on |
or before July 1, 2007. |
The member's employer must give evidence of the member's |
notification by providing to the System:
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(i) a copy of the member's notification to the employer |
or the record of that notification;
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(ii) an affidavit signed by the member and the |
employer, verifying the notification; and
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(iii) any additional documentation that the System may |
require.
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(c) Except as otherwise provided in subsection (b), and |
subject to the provisions of Section 16-176, a member retiring |
on or after July 1, 2005 and on or before June 30, 2013 (or |
January 1, 2014 in the case of a member who has filed a notice |
of intent to retire with his or her employer on or before June |
30, 2013 and attains age 55 during the period July 1, 2013 |
through December 31, 2013) , and applying for a retirement |
annuity within 6 months of the last day of teaching for which |
retirement contributions were required, and whose last day of |
teaching is on or before June 30, 2013, may elect at the time |
of application for a retirement annuity, to make a one-time |
member contribution to the System and thereby avoid the |
reduction in the retirement annuity for retirement before age |
60 specified in paragraph (B) of Section 16-133. The exercise |
of the election shall also obligate the last employer to make a |
one-time nonrefundable contribution to the System. Substitute |
teachers wishing to exercise this election must teach 85 or |
more days in one school term with one employer, who shall be |
deemed the last employer for purposes of this Section. The last |
day of teaching with that employer must be within 6 months of |
the date of application for retirement. All substitute teaching |
credit applied toward the required 85 days must be earned after |
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June 30, 1990. |
The one-time member and employer contributions shall be a |
percentage of the retiring member's highest annual salary rate |
used in the determination of the average salary for retirement |
annuity purposes. However, when determining the one-time |
member and employer contributions, that part of a member's |
salary with the same employer which exceeds the annual salary |
rate for the preceding year by more than 20% shall be excluded. |
The member contribution shall be at the rate of 11.5% for the |
lesser of the following 2 periods: (1) for each year that the |
member is less than age 60; or (2) for each year that the |
member's creditable service is less than 35 years. The employer |
contribution shall be at the rate of 23.5% for each year the |
member is under age 60. |
Upon receipt of the application and election, the System |
shall determine the one-time employee and employer |
contributions required. The member contribution shall be |
credited to the individual account of the member and the |
employer contribution shall be credited to the Benefit Trust |
Reserve. The avoidance of the reduction in retirement annuity |
provided under this subsection (c) is not applicable until the |
member's contribution, if any, has been received by the System; |
however, the date that contribution is received shall not be |
considered in determining the effective date of retirement.
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The number of members working for a single employer who may |
retire under this subsection (c) in any year may be limited at |
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the option of the employer to a specified percentage of those |
eligible, not less than 10%, with the right to participate to |
be allocated among those applying on the basis of seniority in |
the service of the employer. |
For persons not qualifying for the early retirement without |
discount option under this subsection (c), the option is |
extended for 3 years under subsection (d), but subject to the |
changes in eligibility, conditions, and required contributions |
provided in that subsection. |
(d) A member who is not eligible for the early retirement |
without discount option under subsection (c) may qualify for |
the early retirement without discount option under this |
subsection (d) if the member (1) retires on or after July 1, |
2013 and before July 1, 2016, (2) applies for a retirement |
annuity within 6 months of the last day of teaching for which |
retirement contributions were required, and (3) receives a |
certification of eligibility under this subsection from the |
member's last employer. Substitute teachers wishing to |
exercise this election must teach 85 or more days in one school |
term with one employer, who shall be deemed the last employer |
for purposes of this Section. The last day of teaching with |
that employer must be within 6 months of the date of |
application for retirement. All substitute teaching credit |
applied toward the required 85 days must be earned after June |
30, 1990. |
A qualifying member may elect at the time of application |
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for a retirement annuity to make a one-time member contribution |
to the System and thereby avoid the reduction in the retirement |
annuity for retirement before age 60 specified in paragraph (B) |
of Section 16-133. The exercise of this election shall also |
obligate the last employer to make a one-time nonrefundable |
contribution to the System. |
The one-time member and employer contributions shall be a |
percentage of the retiring member's highest annual salary rate |
used in the determination of the average salary for retirement |
annuity purposes. However, when determining the one-time |
member and employer contributions, that part of a member's |
salary with the same employer which exceeds the annual salary |
rate for the preceding year by more than 20% shall be excluded. |
The member contribution shall be at the rate of 14.4% for the |
lesser of the following 2 periods: (1) for each year that the |
member is less than age 60; or (2) for each year that the |
member's creditable service is less than 35 years. The employer |
contribution shall be at the rate of 29.3% for each year the |
member is under age 60. |
Upon receipt of the application, election, and |
certification of eligibility, the System shall determine the |
one-time employee and employer contributions required. The |
member contribution shall be credited to the individual account |
of the member and the employer contribution shall be credited |
to the Benefit Trust Reserve. The avoidance of the reduction in |
retirement annuity provided under this subsection (d) is not |
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applicable until the member's contribution has been received by |
the System; however, the date that contribution is received |
shall not be considered in determining the effective date of |
retirement. |
Eligibility to retire under this subsection (d) shall |
require the approval of the member's last employer under this |
Article, granted in accordance with criteria adopted by that |
employer with the mutual consent of the bargaining agent of a |
majority of the members employed by that employer. If the |
employer grants its approval for a member to retire under this |
subsection (d), the employer shall submit a certification of |
eligibility for the member in a manner prescribed by the |
System. |
The early retirement without discount option under this |
subsection (d) terminates on July 1, 2016. |
(Source: P.A. 93-469, eff. 8-8-03; 94-4, eff. 6-1-05.)
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(40 ILCS 5/16-152) (from Ch. 108 1/2, par. 16-152)
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Sec. 16-152. Contributions by members.
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(a) Each member shall make contributions for membership |
service to this
System as follows:
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(1) Effective July 1, 1998, contributions of 7.50% of |
salary towards the
cost of the retirement annuity. Such |
contributions shall be deemed "normal
contributions".
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(2) Effective July 1, 1969, contributions of 1/2 of 1% |
of salary toward
the cost of the automatic annual increase |
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in retirement annuity provided
under Section 16-133.1.
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(3) Effective July 24, 1959, contributions of 1% of |
salary towards the
cost of survivor benefits. Such |
contributions shall not be credited to
the individual |
account of the member and shall not be subject to refund
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except as provided under Section 16-143.2.
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(4) Effective July 1, 2005, contributions of 0.40% of |
salary toward the cost of the early retirement without |
discount option provided under Section 16-133.2. This |
contribution shall cease upon termination of the early |
retirement without discount option as provided in Section |
16-133.2 16-176 .
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(b) The minimum required contribution for any year of |
full-time
teaching service shall be $192.
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(c) Contributions shall not be required of any annuitant |
receiving
a retirement annuity who is given employment as |
permitted under Section 16-118 or 16-150.1.
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(d) A person who (i) was a member before July 1, 1998, (ii) |
retires with
more than 34 years of creditable service, and |
(iii) does not elect to qualify
for the augmented rate under |
Section 16-129.1 shall be entitled, at the time
of retirement, |
to receive a partial refund of contributions made under this
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Section for service occurring after the later of June 30, 1998 |
or attainment
of 34 years of creditable service, in an amount |
equal to 1.00% of the salary
upon which those contributions |
were based.
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(e) A member's contributions toward the cost of early |
retirement without discount made under item (a)(4) of this |
Section shall not be refunded if the member has elected early |
retirement without discount under Section 16-133.2 and has |
begun to receive a retirement annuity under this Article |
calculated in accordance with that election. Otherwise, a |
member's contributions toward the cost of early retirement |
without discount made under item (a)(4) of this Section shall |
be refunded according to whichever one of the following |
circumstances occurs first: |
(1) The contributions shall be refunded to the member, |
without interest, within 120 days after the member's |
retirement annuity commences, if the member does not elect |
early retirement without discount under Section 16-133.2. |
(2) The contributions shall be included, without |
interest, in any refund claimed by the member under Section |
16-151. |
(3) The contributions shall be refunded to the member's |
designated beneficiary (or if there is no beneficiary, to |
the member's estate), without interest, if the member dies |
without having begun to receive a retirement annuity under |
this Article. |
(4) The contributions shall be refunded to the member, |
without interest, if within 120 days after the early |
retirement without discount option provided under |
subsection (d) of Section 16-133.2 is terminated under |
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Section 16-176 .
The System shall provide to the member, |
within 120 days after the option is terminated, an |
application for a refund of those contributions. |
(Source: P.A. 93-320, eff. 7-23-03; 94-4, eff. 6-1-05.)
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(40 ILCS 5/16-176) (from Ch. 108 1/2, par. 16-176)
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Sec. 16-176. To adopt actuarial assumptions. For the 5-year |
period ending
June 30, 1997 and every 5 years thereafter, the |
actuary, as technical advisor,
shall make an actuarial
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investigation into the mortality, service and compensation |
experience of the
members, annuitants, and beneficiaries of the |
retirement system. Based upon
the result of that investigation, |
the board shall adopt such
actuarial assumptions as it deems |
appropriate.
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Beginning with the 5-year period ending June 30, 2012 and |
every 5 years thereafter through June 30, 2012 , the actuarial |
investigation required under this Section shall include the |
System's experience under the early retirement without |
discount option established in Section 16-133.2, including |
consideration of the sufficiency of the member and employer |
contributions under Section 16-133.2 and the active member |
contribution under Section 16-152 to adequately fund the early |
retirement without discount option. The Board shall promptly |
communicate the results of the actuarial investigation to the |
Commission on Government Forecasting and Accountability. Based |
on the actuarial investigation, the Commission on Government |
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Forecasting and Accountability shall, no later than February 1 |
of the next year, recommend to the General Assembly any |
proportional adjustment in the amounts of the member and |
employer contributions under Section 16-133.2 that it deems |
necessary. |
The If the General Assembly fails to adjust the member and |
employer contributions under Section 16-133.2 in response to |
the Commission's recommendations, then the early retirement |
without discount option under subsection (c) of Section |
16-133.2 is extended as provided in subsection (d) of that |
Section. The early retirement without discount option under |
subsection (d) of Section 16-133.2 terminates on July 1, 2016 |
terminated and shall cease to be available at the end of the |
fiscal year in which the Commission made its recommendation to |
the General Assembly . |
(Source: P.A. 94-4, eff. 6-1-05.)
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Section 99. Effective date. This Act takes effect upon |
becoming law.
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