Public Act 096-1140
Public Act 1140 96TH GENERAL ASSEMBLY
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Public Act 096-1140
| | HB4960 Enrolled | LRB096 15968 AMC 31213 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 | Sections 7-118, 7-137, 7-172, and 7-220 as follows:
| (40 ILCS 5/7-118) (from Ch. 108 1/2, par. 7-118)
| Sec. 7-118. "Beneficiary". :
| (a) "Beneficiary" means: | (1) Any person or persons, trust, or charity designated | as a beneficiary
by an employee, former employee who has | not yet received a retirement annuity
or separation | benefit, or employee annuitant. If no designation is on | file or
no beneficiary so designated survives, the estate | of the employee, former
employee who has not yet received a | retirement annuity or separation benefit,
or employee | annuitant. | (2) Any person or persons, trust, or charity designated | as a beneficiary
by a beneficiary annuitant or, if no | designation is on file or no beneficiary
so designated | survives, the estate of the beneficiary annuitant.
The | surviving spouse of an employee or of an employee
| annuitant, or if no surviving spouse survives, the person | or persons
designated by a participating employee or |
| employee annuitant, or if no
person so designated survives, | or if no designation is on file, the
estate of the employee | or employee annuitant. The person or persons
designated by | a beneficiary annuitant, or if no person designated
| survives, or if no designation is on file, the estate of | the beneficiary
annuitant. | (3) The estate of a surviving spouse annuitant where | the employee
or employee annuitant filed no designation, or | no person designated
survives at the death of a surviving | spouse annuitant. | (b) Designations of
beneficiaries shall be in writing on | forms prescribed by the board and
effective upon filing in the | fund offices. The designation forms shall
provide for | contingent beneficiaries. Divorce, dissolution or annulment
of | marriage revokes the designation of an employee's former spouse | as a
beneficiary on a designation executed before entry of | judgment for divorce,
dissolution or annulment of marriage.
| (b) Notwithstanding the foregoing, an employee, former | employee who has
not yet received a retirement annuity or | separation benefit, or employee
annuitant may elect to name any | person, trust or charity to be the
primary beneficiary of any | death benefit payable by reason of his death. Such
election | shall state specifically whether it is his intention to exclude | the
spouse, shall be in writing, and may be revoked at any | time. Such election or
revocation shall take effect upon being | filed in the fund offices.
|
| (c) If a surviving spouse annuity is payable to a former | spouse upon
the death of an employee annuitant, the former | spouse, unless designated by
the employee annuitant after | dissolution of the marriage, shall not be the
beneficiary for | the purposes of the $3,000 death benefit
payable under | subparagraph 6 of Section 7-164. This benefit shall be paid
to | the designated beneficiary of the employee annuitant or, if | there is no
designation, then to the estate of the employee | annuitant.
| (Source: P.A. 89-136, eff. 7-14-95; 90-448, eff. 8-16-97.)
| (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 and , (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. 93-933, eff. 8-13-04.)
| (40 ILCS 5/7-172) (from Ch. 108 1/2, par. 7-172)
| Sec. 7-172. Contributions by participating municipalities | and
participating instrumentalities.
| (a) Each participating municipality and each participating
| instrumentality shall make payment to the fund as follows:
| 1. municipality contributions in an amount determined | by applying
the municipality contribution rate to each | payment of earnings paid to
each of its participating | employees;
| 2. an amount equal to the employee contributions | provided by paragraphs
(a) and (b) of Section 7-173, | whether or not the employee contributions are
withheld as | permitted by that Section;
| 3. all accounts receivable, together with interest | charged thereon,
as provided in Section 7-209;
| 4. if it has no participating employees with current | earnings, an
amount payable which, over a closed period of | 20 years for participating municipalities and 10 years for | participating instrumentalities beginning with the year
| following an award of benefit, will amortize, at the | effective rate for
that year, any unfunded obligation. The |
| unfunded obligation shall be computed as provided in | paragraph 2 of subsection (b); negative balance in its | municipality reserve resulting
from the award. This amount | when established will be payable as a
separate contribution | whether or not it later has participating employees. | 5. if it has fewer than 7 participating employees or a | negative balance in its municipality reserve, the greater | of (A) an amount payable that, over a period of 20 years, | will amortize at the effective rate for that year any | unfunded obligation, computed as provided in paragraph 2 of | subsection (b) or (B) the amount required by paragraph 1 of | this subsection (a).
| (b) A separate municipality contribution rate shall be | determined
for each calendar year for all participating | municipalities together
with all instrumentalities thereof. | The municipality contribution rate
shall be determined for | participating instrumentalities as if they were
participating | municipalities. The municipality contribution rate shall
be | the sum of the following percentages:
| 1. The percentage of earnings of all the participating | employees of all
participating municipalities and | participating instrumentalities which, if paid
over the | entire period of their service, will be sufficient when | combined with
all employee contributions available for the | payment of benefits, to provide
all annuities for | participating employees, and the $3,000 death benefit
|
| payable under Sections 7-158 and 7-164, such percentage to | be known as the
normal cost rate.
| 2. The percentage of earnings of the participating | employees of each
participating municipality and | participating instrumentalities necessary
to adjust for | the difference between the present value of all benefits,
| excluding temporary and total and permanent disability and | death benefits, to
be provided for its participating | employees and the sum of its accumulated
municipality | contributions and the accumulated employee contributions | and the
present value of expected future employee and | municipality contributions
pursuant to subparagraph 1 of | this paragraph (b). This adjustment shall be
spread over | the remainder of the period that is allowable under | generally
accepted accounting principles.
| 3. The percentage of earnings of the participating | employees of all
municipalities and participating | instrumentalities necessary to provide
the present value | of all temporary and total and permanent disability
| benefits granted during the most recent year for which | information is
available.
| 4. The percentage of earnings of the participating | employees of all
participating municipalities and | participating instrumentalities
necessary to provide the | present value of the net single sum death
benefits expected | to become payable from the reserve established under
|
| Section 7-206 during the year for which this rate is fixed.
| 5. The percentage of earnings necessary to meet any | deficiency
arising in the Terminated Municipality Reserve.
| (c) A separate municipality contribution rate shall be | computed for
each participating municipality or participating | instrumentality
for its sheriff's law enforcement employees.
| A separate municipality contribution rate shall be | computed for the
sheriff's law enforcement employees of each | forest preserve district that
elects to have such employees. | For the period from January 1, 1986 to
December 31, 1986, such | rate shall be the forest preserve district's regular
rate plus | 2%.
| In the event that the Board determines that there is an | actuarial
deficiency in the account of any municipality with | respect to a person who
has elected to participate in the Fund | under Section 3-109.1 of this Code,
the Board may adjust the | municipality's contribution rate so as to make up
that | deficiency over such reasonable period of time as the Board may | determine.
| (d) The Board may establish a separate municipality | contribution
rate for all employees who are program | participants employed under the
federal Comprehensive | Employment Training Act by all of the
participating | municipalities and instrumentalities. The Board may also
| provide that, in lieu of a separate municipality rate for these
| employees, a portion of the municipality contributions for such |
| program
participants shall be refunded or an extra charge | assessed so that the
amount of municipality contributions | retained or received by the fund
for all CETA program | participants shall be an amount equal to that which
would be | provided by the separate municipality contribution rate for all
| such program participants. Refunds shall be made to prime | sponsors of
programs upon submission of a claim therefor and | extra charges shall be
assessed to participating | municipalities and instrumentalities. In
establishing the | municipality contribution rate as provided in paragraph
(b) of | this Section, the use of a separate municipality contribution
| rate for program participants or the refund of a portion of the
| municipality contributions, as the case may be, may be | considered.
| (e) Computations of municipality contribution rates for | the
following calendar year shall be made prior to the | beginning of each
year, from the information available at the | time the computations are
made, and on the assumption that the | employees in each participating
municipality or participating | instrumentality at such time will continue
in service until the | end of such calendar year at their respective rates
of earnings | at such time.
| (f) Any municipality which is the recipient of State | allocations
representing that municipality's contributions for | retirement annuity
purposes on behalf of its employees as | provided in Section 12-21.16 of
the Illinois Public Aid Code |
| shall pay the allocations so
received to the Board for such | purpose. Estimates of State allocations to
be received during | any taxable year shall be considered in the
determination of | the municipality's tax rate for that year under Section
7-171. | If a special tax is levied under Section 7-171, none of the
| proceeds may be used to reimburse the municipality for the | amount of State
allocations received and paid to the Board. Any | multiple-county or
consolidated health department which | receives contributions from a county
under Section 11.2 of "An | Act in relation to establishment and maintenance
of county and | multiple-county health departments", approved July 9, 1943,
as | amended, or distributions under Section 3 of the Department of | Public
Health Act, shall use these only for municipality | contributions by the
health department.
| (g) Municipality contributions for the several purposes | specified
shall, for township treasurers and employees in the | offices of the
township treasurers who meet the qualifying | conditions for coverage
hereunder, be allocated among the | several school districts and parts of
school districts serviced | by such treasurers and employees in the
proportion which the | amount of school funds of each district or part of
a district | handled by the treasurer bears to the total amount of all
| school funds handled by the treasurer.
| From the funds subject to allocation among districts and | parts of
districts pursuant to the School Code, the trustees | shall withhold the
proportionate share of the liability for |
| municipality contributions imposed
upon such districts by this | Section, in respect to such township treasurers
and employees | and remit the same to the Board.
| The municipality contribution rate for an educational | service center shall
initially be the same rate for each year | as the regional office of
education or school district
which | serves as its administrative agent. When actuarial data become
| available, a separate rate shall be established as provided in | subparagraph
(i) of this Section.
| The municipality contribution rate for a public agency, | other than a
vocational education cooperative, formed under the | Intergovernmental
Cooperation Act shall initially be the | average rate for the municipalities
which are parties to the | intergovernmental agreement. When actuarial data
become | available, a separate rate shall be established as provided in
| subparagraph (i) of this Section.
| (h) Each participating municipality and participating
| instrumentality shall make the contributions in the amounts | provided in
this Section in the manner prescribed from time to | time by the Board and
all such contributions shall be | obligations of the respective
participating municipalities and | participating instrumentalities to this
fund. The failure to | deduct any employee contributions shall not
relieve the | participating municipality or participating instrumentality
of | its obligation to this fund. Delinquent payments of | contributions
due under this Section may, with interest, be |
| recovered by civil action
against the participating | municipalities or participating
instrumentalities. | Municipality contributions, other than the amount
necessary | for employee contributions and Social Security contributions, | for
periods of service by employees from whose earnings no | deductions were made
for employee contributions to the fund, | may be charged to the municipality
reserve for the municipality | or participating instrumentality.
| (i) Contributions by participating instrumentalities shall | be
determined as provided herein except that the percentage | derived under
subparagraph 2 of paragraph (b) of this Section, | and the amount payable
under subparagraph 5 of paragraph (a) of | this Section, shall be based on
an amortization period of 10 | years.
| (j) Notwithstanding the other provisions of this Section, | the additional unfunded liability accruing as a result of this | amendatory Act of the 94th General Assembly
shall be amortized | over a period of 30 years beginning on January 1 of the
second | calendar year following the calendar year in which this | amendatory Act takes effect, except that the employer may | provide for a longer amortization period by adopting a | resolution or ordinance specifying a 35-year or 40-year period | and submitting a certified copy of the ordinance or resolution | to the fund no later than June 1 of the calendar year following | the calendar year in which this amendatory Act takes effect.
| (Source: P.A. 94-712, eff. 6-1-06.)
|
| (40 ILCS 5/7-220) (from Ch. 108 1/2, par. 7-220)
| Sec. 7-220. Administrative review. The provisions of the | Administrative Review Law, and all amendments and
| modifications thereof and the rules adopted
pursuant thereto | shall apply to and govern all proceedings for the judicial
| review of final administrative decisions of the retirement | board provided
for under this Article. The term "administrative | decision" is as defined in
Section 3-101 of the Code of Civil | Procedure. The venue for actions brought under the | Administrative Review Law shall be any county in which the | Board maintains an office or the county in which the member's | plaintiff's employing participating municipality or | participating instrumentality has its main office.
| (Source: P.A. 82-783.)
| Section 90. The State Mandates Act is amended by adding | Section 8.34 as follows:
| (30 ILCS 805/8.34 new) | Sec. 8.34. 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.
|
Effective Date: 7/21/2010
|
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