Public Act 093-0933
 
HB0587 Enrolled LRB093 05661 EFG 05754 b

    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.