HB4575 93RD GENERAL ASSEMBLY

LRB093 20772 LRD 46673 b

93RD GENERAL ASSEMBLY
State of Illinois
2003 and 2004
HB4575

Introduced 2/4/2004, by Ralph C. Capparelli

SYNOPSIS AS INTRODUCED:

See Index

Amends the Metropolitan Water Reclamation District Article of the Illinois Pension Code. Provides that a child's annuity is payable to a child who is over 18 years of age, but less than 23 years of age, if he or she is a full-time student. Eliminates the 3-day waiting period for the payment of a duty disability benefit for certain persons. Creates an interim disability benefit for an employee who has a pending workers' compensation claim or who is awaiting a final determination by the Industrial Commission. Provides a minimum annuity for certain retirees and surviving spouses. Authorizes employer pickup and tax-deferred status for contributions made toward the alternative plan for commissioners. With respect to the 5 years of service needed to establish eligibility for a disability retirement annuity, excludes service credit earned while on disability for new employees. Clarifies the calculation of service with respect to the Optional Plan. Allows an employee who has returned to service to repay a prior refund within the 90 days following his or her final withdrawal from service. Allows payment of a refund to certain nonvested employees who are under age 55 (rather than 50). Provides that the refund due to a person who enters service on or after the effective date of this amendatory Act and who must forfeit his or her pension because of a felony conviction shall be equal to his or her contributions (including amounts paid by the person to establish additional or optional credit), without interest, less the amount of any benefits paid to the person (including benefits paid to an alternate payee under a QILDRO). Provides that the refund shall not include employer contributions or any interest on contributions. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.

FISCAL NOTE ACT MAY APPLY

PENSION IMPACT NOTE ACT MAY APPLY

STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT

A BILL FOR

AN ACT in relation to 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 13-301, 13-302, 13-306, 13-308, 13-309, 13-310, 13-311, 13-314, 13-402, 13-502, 13-601, 13-603, and 13-807 and adding Section 13-309.1 as follows:

(40 ILCS 5/13-301) (from Ch. 108 1/2, par. 13-301)

Sec. 13-301. Retirement annuity; eligibility. Any employee who withdraws from service and meets the age and service requirements and other conditions set forth in subsections (a), (b), (c) or (d) hereof is entitled to receive a retirement annuity.

(a) Withdrawal on or after age 60. Any employee, upon withdrawal from service on or after attainment of age 60 and having at least 5 years of service, is entitled to a retirement annuity.

(b) Withdrawal on or after attainment of minimum retirement qualifications and prior to age 60.

(1) Any employee, upon withdrawal from service on or after attainment of age 55 (age 50 if the employee first entered service before June 13, 1997) but prior to age 60 and having at least 10 years of service, is entitled to a retirement annuity as of the date of withdrawal or, at the option of the employee, at any time thereafter.

(2) Any employee who withdraws on or after attainment of age 55 (age 50 if the employee first entered service before June 13, 1997) and prior to age 60 having at least 5 years but less than 10 years of service is entitled to a retirement annuity upon attainment of age 62, subject to the other requirements of this Article.

(3) Any employee who withdraws from service on or after attainment of age 50 but prior to age 60 and is eligible for early retirement without discount under the Rule of 80 as provided in subsection (c) of Section 13-302 is entitled to a retirement annuity at the time of withdrawal.

(c) Withdrawal prior to minimum retirement age. Any employee, upon withdrawal from service prior to age 55 (age 50 if the employee first entered service before June 13, 1997) and having at least 10 years of service, shall become entitled to a retirement annuity upon attainment of age 55 (age 50 if the employee first entered service before June 13, 1997) or, at the option of the employee, at any time thereafter, subject to the other requirements of this Article.

(d) Withdrawal while disabled. Any employee having at least 5 years of service who has received ordinary disability benefits on or after January 1, 1986 for the maximum period of time hereinafter prescribed, and who continues to be disabled and withdraws from service, shall be entitled to a retirement annuity. In the case of an employee who enters service after the effective date of this amendatory Act of the 93rd General Assembly, the required 5 years of service is exclusive of service credit described in Section 13-313. The age and service conditions as to eligibility for such annuity shall be waived as to the employee, but the early retirement discount under Section 13-302(b) shall apply. If the employee is under age 55 on the date of withdrawal, the retirement annuity shall be computed by assuming that the employee is then age 55 and then reduced to its actuarial equivalent at his attained age on that date according to applicable mortality tables and interest rates. The retirement annuity shall not be payable for any period prior to the employee's attainment of age 55 during which the employee is able to return to gainful employment. Upon the employee's death while in receipt of a retirement annuity, a surviving spouse or minor children shall be entitled to receive a surviving spouse's annuity or child's annuity subject to the conditions hereinafter prescribed in Sections 13-305 through 13-308.

(Source: P.A. 92-599, eff. 6-28-02.)

(40 ILCS 5/13-302) (from Ch. 108 1/2, par. 13-302)

Sec. 13-302. Computation of retirement annuity.

(a) Computation of annuity. An employee who withdraws from service on or after July 1, 1989 and who has met the age and service requirements and other conditions for eligibility set forth in Section 13-301 of this Article is entitled to receive a retirement annuity for life equal to 2.2% of average final salary for each of the first 20 years of service, and 2.4% of average final salary for each year of service in excess of 20. The retirement annuity shall not exceed 80% of average final salary.

(b) Early retirement discount. If an employee retires prior to attainment of age 60 with less than 30 years of service, the annuity computed above shall be reduced by 1/2 of 1% for each full month between the date the annuity begins and attainment of age 60, or each full month by which the employee's service is less than 30 years, whichever is less. However, where the employee first enters service after June 13, 1997 and does not have at least 10 years of service exclusive of credit under Article 20, the annuity computed above shall be reduced by 1/2 of 1% for each full month between the date the annuity begins and attainment of age 60.

(c) Rule of 80 - Early retirement without discount. For an employee who retires on or after January 1, 2003 but on or before December 31, 2007, if the employee is eligible for a retirement annuity under Section 13-301 and has at least 10 years of service exclusive of credit under Article 20 and if at the date of withdrawal the employee's age when added to the number of years of his or her creditable service equals at least 80, the early retirement discount in subsection (b) of this Section does not apply. For purposes of this Rule of 80, portions of years shall be considered in whole months.

An employee who has terminated employment with the employer under this Article prior to the effective date of this amendatory Act of the 92nd General Assembly and subsequently re-enters service must remain in service with the employer under this Article for at least 2 years after re-entry during the period beginning on January 1, 2003 and ending on December 31, 2007 to be entitled to early retirement without discount under this subsection (c).

In the case of an employee who retires under the terms of Article 20, eligibility for early retirement without discount under this subsection (c) shall be based upon the employee's age and service credit at the time of withdrawal from the final fund.

(c-1) Early retirement without discount; retirement after June 29, 1997 and before January 1, 2003. An employee who (i) has attained age 55 (age 50 if the employee first entered service before June 13, 1997), (ii) has at least 10 years of service exclusive of credit under Article 20, (iii) retires after June 29, 1997 and before January 1, 2003, and (iv) retires within 6 months of the last day for which retirement contributions were required, may elect at the time of application to make a one-time employee contribution to the Fund and thereby avoid the early retirement reduction specified in subsection (b). The exercise of the election shall also obligate the employer to make a one-time nonrefundable contribution to the Fund.

The one-time employee and employer contributions shall be a percentage of the retiring employee's highest full-time annual salary, calculated as the total amount of salary included in the highest 26 consecutive pay periods as used in the average final salary calculation, and based on the employee's age and service at retirement. The employee rate shall be 7% multiplied by the lesser of the following 2 numbers: (1) the number of years, or portion thereof, that the employee is less than age 60; or (2) the number of years, or portion thereof, that the employee's service is less than 30 years. The employer contribution shall be at the rate of 20% for each year, or portion thereof, that the participant is less than age 60.

Upon receipt of the application, the Board shall determine the corresponding employee and employer contributions. The annuity shall not be payable under this subsection until both the required contributions have been received by the Fund. However, the date the contributions are received shall not be considered in determining the effective date of retirement.

The number of employees who may retire under this Section in any year may be limited at the option of the District to a specified percentage of those eligible, not lower than 30%, with the right to participate to be allocated among those applying on the basis of seniority in the service of the employer.

An employee who has terminated employment and subsequently re-enters service shall not be entitled to early retirement without discount under this subsection unless the employee continues in service for at least 4 years after re-entry.

(d) Annual increase. Except for employees retiring and receiving a term annuity, an employee who retires on or after July 1, 1985 but before July 12, 2001, shall, upon the first payment date following the first anniversary of the date of retirement, have the monthly annuity increased by 3% of the amount of the monthly annuity fixed at the date of retirement. Except for employees retiring and receiving a term annuity, an employee who retires on or after July 12, 2001 shall, on the first day of the month in which the first anniversary of the date of retirement occurs, have the monthly annuity increased by 3% of the amount of the monthly annuity fixed at the date of retirement. The monthly annuity shall be increased by an additional 3% on the same date each year thereafter. Beginning January 1, 1993, all annual increases payable under this subsection (or any predecessor provision, regardless of the date of retirement) shall be calculated at the rate of 3% of the monthly annuity payable at the time of the increase, including any increases previously granted under this Article.

Any employee who (i) retired before July 1, 1985 with at least 10 years of creditable service, (ii) is receiving a retirement annuity under this Article, other than a term annuity, and (iii) has not received any annual increase under this subsection, shall begin receiving the annual increases provided under this subsection (d) beginning on the next annuity payment date following June 13, 1997.

(e) Minimum retirement annuity. Beginning January 1, 1993, the minimum monthly retirement annuity shall be $500 for any annuitant having at least 10 years of service under this Article, other than a term annuitant or an annuitant who began receiving the annuity before attaining age 60. Any such annuitant who is receiving a monthly annuity of less than $500 shall have the annuity increased to $500 on that date.

Beginning January 1, 1993, the minimum monthly retirement annuity shall be $250 for any annuitant (other than a term or reciprocal annuitant or an annuitant under subsection (d) of Section 13-301) having less than 10 years of service under this Article, and for any annuitant (other than a term annuitant) having at least 10 years of service under this Article who began receiving the annuity before attaining age 60. Any such annuitant who is receiving a monthly annuity of less than $250 shall have the annuity increased to $250 on that date.

Beginning August 1, 2001 on the first day of the month following the month in which this amendatory Act of the 92nd General Assembly takes effect (and without regard to whether the annuitant was in service on or after that effective date), the minimum monthly retirement annuity for any annuitant having at least 10 years of service, other than an annuitant whose annuity is subject to an early retirement discount, shall be $500 plus $25 for each year of service in excess of 10, not to exceed $750 for an annuitant with 20 or more years of service. In the case of a reciprocal annuity, this minimum shall apply only if the annuitant has at least 10 years of service under this Article, and the amount of the minimum annuity shall be reduced by the sum of all the reciprocal annuities payable to the annuitant by other participating systems under Article 20 of this Code.

Notwithstanding any other provision of this subsection, beginning on the first annuity payment date following July 12, 2001, an employee who retired before August 23, 1989 with at least 10 years of service under this Article but before attaining age 60 (regardless of whether the retirement annuity was subject to an early retirement discount) shall be entitled to the same minimum monthly retirement annuity under this subsection as an employee who retired with at least 10 years of service under this Article and after attaining age 60.

Notwithstanding any other provision of this subsection, beginning on the first day of the month following the month in which this amendatory Act of the 93rd General Assembly takes effect (and without regard to whether the annuitant was in service on or after that effective date), an employee who retired on or after August 23, 1989 with at least 10 years of service under this Article but before attaining age 60 (regardless of whether the retirement annuity was subject to an early retirement discount), shall be entitled to the same minimum monthly retirement annuity under this subsection as an employee who retired with at least 10 years of service under this Article and after attaining age 60.

(Source: P.A. 92-53, eff. 7-12-01; 92-599, eff. 6-28-02.)

(40 ILCS 5/13-306) (from Ch. 108 1/2, par. 13-306)

Sec. 13-306. Computation of surviving spouse's annuity.

(a) Computation of the annuity. The surviving spouse's annuity shall be equal to 60% of the retirement annuity earned and accrued to the credit of the deceased employee, whether death occurs while in service or after withdrawal, plus 1% for each year of total service of the employee to a maximum of 85%; provided, however, that if the employee's death arises out of and in the course of the employee's service to the employer and is compensable under either the Illinois Workers' Compensation Act or Illinois Workers' Occupational Diseases Act, the surviving spouse's annuity is payable regardless of the employee's length of service and shall be not less than 50% of the employee's salary at the date of death.

For any death in service the early retirement discount required under Section 13-302(b) shall not be applied in computing the retirement annuity upon which is based the surviving spouse's annuity.

(b) Reciprocal service. For any employee or annuitant who retires on or after July 1, 1985 and whose death occurs after January 1, 1991, having at least 15 years of service with the employer under this Article, and who was eligible at the time of death or elected at the time of retirement to have his or her retirement annuity calculated as provided in Section 20-131 of this Code, the surviving spouse benefit shall be calculated as of the date of the employee's death as indicated in subsection (a) as a percentage of the employee's total benefit as if all service had been with the employer. That benefit shall then be reduced by the amounts payable by each of the reciprocal funds as of the date of death so that the total surviving spouse benefit at that date will be equal to the benefit which would have been payable had all service been with the employer under this Article.

(c) Discount for age differential. The annuity for a surviving spouse shall be discounted by 0.25% for each full month that the spouse is younger than the employee as of the date of withdrawal from service or death in service to a maximum discount of 60% of the surviving spouse annuity as calculated under subsections (a), (b), and (e) of this Section. The discount shall be reduced by 10% for each full year the marriage has been in continuous effect as of the date of withdrawal or death in service. There shall be no discount if the marriage has been in continuous effect for 10 full years or more at the time of withdrawal or death in service.

(d) Annual increase. Effective August 23, 1989, on the first day of each calendar month in which there occurs an anniversary of the employee's date of retirement or date of death, whichever occurred first, the surviving spouse's annuity, other than a term annuity under Section 13-307, shall be increased by an amount equal to 3% of the amount of the annuity. Beginning January 1, 1993, all annual increases payable under this subsection (or any predecessor provision of this Article) shall be calculated at the rate of 3% of the monthly annuity payable at the time of the increase, including any increases previously granted under this Article.

Beginning January 1, 1993, surviving spouse annuitants whose deceased spouse died, retired or withdrew from service before August 23, 1989 with at least 10 years of service under this Article shall be eligible for the annual increases provided under this subsection.

(e) Minimum surviving spouse's annuity.

(1) Beginning January 1, 1993, the minimum monthly surviving spouse's annuity shall be $500 for any annuitant whose deceased spouse had at least 10 years of service under this Article, other than a surviving spouse who is a term annuitant or whose deceased spouse began receiving a retirement annuity under this Article before attainment of age 60. Any such surviving spouse annuitant who is receiving a monthly annuity of less than $500 shall have the annuity increased to $500 on that date.

Beginning January 1, 1993, the minimum monthly surviving spouse's annuity shall be $250 for any annuitant (other than a term or reciprocal annuitant or an annuitant survivor under subsection (d) of Section 13-301) whose deceased spouse had less than 10 years of service under this Article, and for any annuitant (other than a term annuitant) whose deceased spouse had at least 10 years of service under this Article and began receiving a retirement annuity under this Article before attainment of age 60. Any such surviving spouse annuitant who is receiving a monthly annuity of less than $250 shall have the annuity increased to $250 on that date.

(2) Beginning August 1, 2001 on the first day of the month following the month in which this amendatory Act of the 92nd General Assembly takes effect (and without regard to whether the deceased spouse was in service on or after that effective date), the minimum monthly surviving spouse's annuity for any annuitant whose deceased spouse had at least 10 years of service shall be the greater of the following:

(A) An amount equal to $500, plus $25 for each year of the deceased spouse's service in excess of 10, not to exceed $750 for an annuitant whose deceased spouse had 20 or more years of service. This subdivision (A) is not applicable if the deceased spouse received a retirement annuity that was subject to an early retirement discount.

(B) An amount equal to (i) 50% of the retirement annuity earned and accrued to the credit of the deceased spouse at the time of death, plus (ii) the amount of any annual increases applicable to the surviving spouse's annuity (including the amount of any reversionary annuity) under subsection (d) before July 12, 2001 the effective date of this amendatory Act of the 92nd General Assembly. In any case in which a refund of excess contributions for the surviving spouse annuity has been paid by the Fund and the surviving spouse annuity is increased due to the application of this subdivision (B), the amount of that refund shall be recovered by the Fund as an offset against the amount of the increase in annuity arising from the application of this subdivision (B).

In the case of a reciprocal annuity, the minimum annuity calculated under this subdivision (e)(2) shall apply only if the deceased spouse of the annuitant had at least 10 years of service under this Article, and the amount of the minimum annuity shall be reduced by the sum of all the reciprocal annuities payable to the annuitant by other participating systems under Article 20 of this Code.

The minimum annuity calculated under this subdivision (e)(2) is in addition to the amount of any reversionary annuity that may be payable.

(3) Beginning August 1, 2001 on the first day of the month following the month in which this amendatory Act of the 92nd General Assembly takes effect (and without regard to whether the deceased spouse was in service on or after that effective date), any surviving spouse who is receiving a term annuity under Section 13-307 or any predecessor provision of this Article may have that term annuity recalculated and converted to a minimum surviving spouse annuity under this subsection (e).

(4) Notwithstanding any other provision of this subsection, beginning August 1, 2001 on the first annuity payment date following the effective date of this amendatory Act of the 92nd General Assembly, an annuitant whose deceased spouse retired before August 23, 1989 with at least 10 years of service under this Article but before attaining age 60 (regardless of whether the retirement annuity was subject to an early retirement discount) shall be entitled to the same minimum monthly surviving spouse's annuity under this subsection as an annuitant whose deceased spouse retired with at least 10 years of service under this Article and after attaining age 60. Further notwithstanding any other provision of this subsection, beginning on the first day of the month following the month in which this amendatory Act of the 93rd General Assembly takes effect, an annuitant whose deceased spouse retired on or after August 23, 1989 with at least 10 years of service under this Article but before attaining age 60 (regardless of whether the retirement annuity was subject to an early retirement discount) shall be entitled to the same minimum monthly surviving spouse's annuity under this subsection as an annuitant whose deceased spouse retired with at least 10 years of service under this Article and after attaining age 60.

(5) The minimum annuity provided under this subsection (e) shall be subject to the age discount provided under subsection (c) of this Section.

(Source: P.A. 92-53, eff. 7-12-01.)

(40 ILCS 5/13-308) (from Ch. 108 1/2, par. 13-308)

Sec. 13-308. Child's annuity.

(a) Eligibility. A child's annuity shall be provided for each unmarried child under the age of 18 years (under the age of 23 years in the case of a full-time student) whose employee parent dies while in service, or whose deceased parent is an annuitant or former employee with at least 10 years of creditable service who did not take a refund of employee contributions. Eligibility for benefits to unmarried children over the age of 18 but under the age of 23 begins no earlier than the first day of the month following the month in which this amendatory Act of the 93rd General Assembly takes effect.

For purposes of this Section, "employee" includes a former employee, and "child" means the issue of an employee, or a child adopted by an employee if the proceedings for adoption were instituted at least one year prior to the employee's death.

Payments shall cease when a child attains the age of 18 years (age of 23 years in the case of a full-time student) or marries, whichever first occurs. The annuity shall not be payable unless the employee has been employed as an employee for at least 36 months from the date of the employee's original entry into service (at least 24 months in the case of an employee who first entered service before June 13, the effective date of this amendatory Act of 1997) and at least 12 months from the date of the employee's latest re-entry into service; provided, however, that if death arises out of and in the course of service to the employer and is compensable under either the Illinois Workers' Compensation Act or Illinois Workers' Occupational Diseases Act, the annuity is payable regardless of the employee's length of service.

(b) Amount. A child's annuity shall be $500 per month for one child and $350 per month for each additional child, up to a maximum of $2,500 per month for all children of the employee, as provided in this Section, if a parent of the child is living. The child's annuity shall be $1,000 per month for one child and $500 per month for each additional child, up to a maximum of $2,500 for all children of the employee, when neither parent is alive. The total amount payable to all children of the employee shall be divided equally among those children. Any child's annuity which commenced prior to July 12, 2001 the effective date of this amendatory Act of the 92nd General Assembly shall be increased upon the first day of the month following the month in which that effective date occurs, to the amount set forth herein.

(c) Payment. Until a child attains the age of 18 years, a A child's annuity shall be paid to the child's parent or other person who shall be providing for the child without requiring formal letters of guardianship, unless another person shall be appointed by a court of law as guardian.

(Source: P.A. 92-53, eff. 7-12-01.)

(40 ILCS 5/13-309) (from Ch. 108 1/2, par. 13-309)

Sec. 13-309. Duty disability benefit.

(a) Any employee who becomes disabled, which disability is the result of an injury or illness compensable under the Illinois Workers' Compensation Act or the Illinois Workers' Occupational Diseases Act, is entitled to a duty disability benefit during the period of disability for which the employee does not receive any part of salary, or any part of a retirement annuity under this Article; except that in the case of an employee who first enters service on or after June 13, the effective date of this amendatory Act of 1997 and becomes disabled before the effective date of this amendatory Act of the 93rd General Assembly, a duty disability benefit is not payable for the first 3 days of disability that would otherwise be payable under this Section if the disability does not continue for at least 11 additional days. The changes made to this Section by this amendatory Act of the 93rd General Assembly are prospective only and do not entitle an employee to a duty disability benefit for the first 3 days of any disability that occurred before that effective date and did not continue for at least 11 days. This benefit shall be 75% of salary at the date disability begins. However, if the disability in any measure resulted from any physical defect or disease which existed at the time such injury was sustained or such illness commenced, the duty disability benefit shall be 50% of salary.

Unless the employer acknowledges that the disability is a result of injury or illness compensable under the Workers' Compensation Act or the Workers' Occupational Diseases Act, the duty disability benefit shall not be payable until the issue of compensability under those Acts is finally adjudicated. The period of disability shall be as determined by the Illinois Industrial Commission or acknowledged by the employer.

The first payment shall be made not later than one month after the benefit is granted, and subsequent payments shall be made at least monthly. The Board shall by rule prescribe for the payment of such benefits on the basis of the amount of salary lost during the period of disability.

(b) The benefit shall be allowed only if the following requirements are met by the employee:

(1) Application is made to the Board within 90 days from the date disability begins;

(2) A medical report is submitted by at least one licensed and practicing physician as part of the employee's application; and

(3) The employee is examined by at least one licensed and practicing physician appointed by the Board and found to be in a disabled physical condition, and shall be re-examined at least annually thereafter during the continuance of disability. The employee need not be re-examined by a licensed and practicing physician if the attorney for the district certifies in writing that the employee is entitled to receive compensation under the Workers' Compensation Act or the Workers' Occupational Diseases Act.

(c) The benefit shall terminate when:

(1) The employee returns to work or receives a retirement annuity paid wholly or in part under this Article;

(2) The disability ceases;

(3) The employee attains age 65, but if the employee becomes disabled at age 60 or later, benefits may be extended for a period of no more than 5 years after disablement;

(4) The employee (i) refuses to submit to reasonable examinations by physicians or other health professionals appointed by the Board, (ii) fails or refuses to consent to and sign an authorization allowing the Board to receive copies of or to examine the employee's medical and hospital records, or (iii) fails or refuses to provide complete information regarding any other employment for compensation he or she has received since becoming disabled; or

(5) The employee willfully and continuously refuses to follow medical advice and treatment to enable the employee to return to work. However this provision does not apply to an employee who relies in good faith on treatment by prayer through spiritual means alone in accordance with the tenets and practice of a recognized church or religious denomination, by a duly accredited practitioner thereof.

In the case of a duty disability recipient who returns to work, the employee must make application to the Retirement Board within 2 years from the date the employee last received duty disability benefits in order to become again entitled to duty disability benefits based on the injury for which a duty disability benefit was theretofore paid.

In the event that an interim disability benefit has been received, the benefit paid under this Section shall be subject to adjustment by the Board under Section 13-309.1.

(Source: P.A. 90-12, eff. 6-13-97; 91-887, eff. 7-6-00.)

(40 ILCS 5/13-309.1 new)

Sec. 13-309.1. Interim disability benefit.

(a) An employee who claims to be physically incapacitated to perform the duties of his or her position shall receive an interim disability benefit, provided that:

(1) the employer, being a separate entity from the Retirement System governed by this Article, (i) has formally denied all employer-paid temporary total disability benefits under the Workers' Compensation Act or the Workers' Occupational Diseases Act and an appeal of that denial is pending before the Industrial Commission of Illinois, or (ii) has granted and then terminated for any reason an employer-paid temporary total disability benefit and the employee has filed a petition for emergency hearing under Section 19(b-1) of the Workers' Compensation Act or Section 19(b-1) of the Workers' Occupational Diseases Act; and

(2) application is made not later than (i) 3 months after the date that the disability results in loss of pay, (ii) 3 months after the date the employer has formally denied or terminated the employer-paid temporary total disability benefit, or (iii) in the case of termination of an employer-paid temporary total disability benefit, 3 months after the effective date of this amendatory Act of the 93rd General Assembly, whichever occurs last; and

(3) proper proof is received from one or more physicians certifying that the employee is physically incapacitated.

(b) In the case of a denial of benefits, the interim disability benefit shall begin to accrue on the 1st day of absence from work on account of disability, but the benefit shall not become actually payable to the employee until the payroll following the Board meeting at which the benefit is granted. The employee must provide proof of filing a pending appeal of that denial before the Industrial Commission of Illinois.

In the case of termination of an employer-paid temporary total disability benefit, the interim disability benefit under this Section shall be calculated from the day following the date of termination of the employer-paid benefit, but shall not become payable to the employee until the payroll following the Board meeting at which the benefit is granted. The employee must provide proof of filing a petition for emergency hearing under Section 19(b-1) of the Workers' Compensation Act or Section 19(b-1) of the Workers' Occupational Diseases Act.

Only one interim benefit under this subsection may be awarded per injury. If a terminated employer-paid temporary total disability benefit is resumed or replaced with another employer-paid disability benefit and the resumed or replacement benefit is later terminated and the employee again files a petition for emergency hearing under Section 19(b-1) of the Workers' Compensation Act or Section 19(b-1) of the Workers' Occupational Diseases Act, the employee may again become eligible to receive an interim disability benefit under this Section.

The benefit is not payable for any disability which begins during any period of unpaid leave of absence. No benefit shall be allowed for any period of disability prior to 30 days before application is made, unless the Board finds good cause for the delay in filing the application. The benefit shall not be paid during any period for which the employee receives or is entitled to receive any part of salary.

The benefit shall continue to accrue for no more than 3 months or until the first of the following events occurs:

(1) the disability ceases;

(2) the employee engages in gainful employment or receives a retirement annuity paid wholly or in part under this Article;

(3) a payment is made on the employee's claim pursuant to a determination made by the employer under the Workers' Compensation Act or the Workers' Occupational Diseases Act;

(4) a final determination is made on the employee's claim by the Industrial Commission of Illinois.

(5) the date on which the aggregate period for which interim disability payments added to the period for which ordinary disability benefits have been made becomes equal to 25% of the employee's total period of creditable service, not including the time for which he or she has received an interim disability benefit or ordinary disability benefit, and with a cumulative maximum of 5 years for ordinary disability and interim disability benefits combined for purposes of this item (5) only;

(6) the employee (i) refuses to submit to reasonable examinations by physicians or other health professionals appointed by the Board, or (ii) fails or refuses to consent to and sign an authorization allowing the Board to receive copies of or to examine the employee's medical and hospital records, or (iii) fails or refuses to provide complete information regarding any other employment for compensation he or she has received since becoming disabled, or (iv) willfully and continuously refuses to follow medical advice and treatment to enable the employee to return to work.

(c) The interim disability benefit shall be 50% of the employee's salary at the date of disability.

(d) The interim disability benefit provided under this Section is intended as a temporary payment of duty disability or ordinary disability benefit, whichever is appropriate, in cases in which the character of the disability as either a duty disability or an ordinary disability has not been finally determined.

When an employer-paid disability benefit is paid or resumed, the Board shall calculate the benefit that is payable under Section 13-309 and shall deduct from the benefit payable under Section 13-309 the amounts already paid under this Section; those amounts shall then be treated as if they had been paid under Section 13-309.

When a final determination of the character of the disability has been made by the Industrial Commission of Illinois, or by settlement between the parties to the disputed claim, the Board shall calculate the benefit that is payable under Section 13-309 or 13-310, whichever is applicable, and shall deduct from such benefit the amounts already paid under this Section; such amounts shall then be treated as if they had been paid under Section 13-309 or 13-310.

(e) Any excess benefits paid under this Section shall be subject to direct and immediate recovery by the Fund from benefits payable under the Workers' Compensation Act or the Workers' Occupational Diseases Act or from third parties as provided in Section 13-311, or from any other benefits payable either to the member or on his behalf under this Article. A member who accepts benefits under this Section acknowledges and authorizes these recovery rights of the System. In the event that this Retirement System does not receive immediate recovery according to this subsection (e), the employee must pay to the Fund the excess benefit amount, plus interest at the annual rate from time to time determined by the Board, compounded annually from the date the benefit was paid to the employee by the third party to the date of payment to this Retirement System by the employee.

(f) The Board shall prescribe rules governing the filing of claims for interim disability benefits, and the investigation, control and supervision of those claims.

(g) References in this Section to employer-paid benefits include benefits paid for by the Employer, either directly or through a program of insurance or self-insurance; but the term does not include benefits paid by the Fund under this Article.

(40 ILCS 5/13-310) (from Ch. 108 1/2, par. 13-310)

Sec. 13-310. Ordinary disability benefit.

(a) Any employee who becomes disabled as the result of any cause other than injury or illness incurred in the performance of duty for the employer or any other employer, or while engaged in self-employment activities, shall be entitled to an ordinary disability benefit. The eligible period for this benefit shall be 25% of the employee's total actual service prior to the date of disability with a cumulative maximum period of 5 years.

(b) The benefit shall be allowed only if the employee files an application in writing with the Board, and a medical report is submitted by at least one licensed and practicing physician as part of the employee's application.

The benefit is not payable for any disability which begins during any period of unpaid leave of absence. No benefit shall be allowed for any period of disability prior to 30 days before application is made, unless the Board finds good cause for the delay in filing the application. The benefit shall not be paid during any period for which the employee receives or is entitled to receive any part of salary.

The benefit is not payable for any disability which begins during any period of absence from duty other than allowable vacation time in any calendar year. An employee whose disability begins during any such ineligible period of absence from service may not receive benefits until the employee recovers from the disability and is in service for at least 15 consecutive working days after such recovery.

In the case of an employee who first enters service on or after June 13, the effective date of this amendatory Act of 1997, an ordinary disability benefit is not payable for the first 3 days of disability that would otherwise be payable under this Section if the disability does not continue for at least 11 additional days.

Beginning on the effective date of this amendatory Act of the 93rd General Assembly, an employee who first entered service on or after June 13, 1997 is also eligible for ordinary disability benefits on the 31st day after the last day worked, provided all sick leave is exhausted.

(c) The benefit shall be 50% of the employee's salary at the date of disability, and shall terminate when the earliest of the following occurs:

(1) The employee returns to work or receives a retirement annuity paid wholly or in part under this Article;

(2) The disability ceases;

(3) The employee willfully and continuously refuses to follow medical advice and treatment to enable the employee to return to work. However this provision does not apply to an employee who relies in good faith on treatment by prayer through spiritual means alone in accordance with the tenets and practice of a recognized church or religious denomination, by a duly accredited practitioner thereof;

(4) The employee (i) refuses to submit to a reasonable physical examination within 30 days of application by a physician appointed by the Board, (ii) in the case of chronic alcoholism, the employee refuses to join a rehabilitation program licensed by the Department of Public Health of the State of Illinois and certified by the Joint Commission on the Accreditation of Hospitals, (iii) fails or refuses to consent to and sign an authorization allowing the Board to receive copies of or to examine the employee's medical and hospital records, or (iv) fails or refuses to provide complete information regarding any other employment for compensation he or she has received since becoming disabled; or

(5) The eligible period for this benefit has been exhausted.

The first payment of the benefit shall be made not later than one month after the same has been granted, and subsequent payments shall be made at intervals of not more than 30 days.

(d) In the event that an interim disability benefit has been received, the benefit paid under this Section shall be subject to adjustment by the Board under Section 13-309.1.

(Source: P.A. 90-12, eff. 6-13-97; 91-887, eff. 7-6-00.)

(40 ILCS 5/13-311) (from Ch. 108 1/2, par. 13-311)

Sec. 13-311. Credit for Workers' Compensation payments. If an employee, or an employee's spouse or children, receives compensation under any workers' compensation or occupational diseases law, the benefit payable under this Article shall be reduced by the amount of the compensation so received if the amount is less than the annuity or benefit. If the compensation exceeds the annuity or benefit, no payment of annuity or benefit shall be made until the period of time has elapsed when the annuity or benefit payable at the rates provided in this Article equals the amount of such compensation. However, the commutation of compensation to a lump sum basis as provided in the workers' compensation or occupational diseases law shall not increase the annuity or benefit provided under this Article; the annuity or benefit to be paid hereunder shall be based on the amount of compensation awarded under such laws prior to commutation of such compensation. No interest shall be considered in these calculations, except for benefits paid under Section 13-309.1.

(Source: P.A. 91-887, eff. 7-6-00.)

(40 ILCS 5/13-314) (from Ch. 108 1/2, par. 13-314)

Sec. 13-314. Alternative provisions for Water Reclamation District commissioners.

(a) Transfer of credits. Any Water Reclamation District commissioner elected by vote of the people and who has elected to participate in this Fund may transfer to this Fund credits and creditable service accumulated under any other pension fund or retirement system established under Articles 2 through 18 of this Code, upon payment to the Fund of (1) the amount by which 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, exceeds the amounts actually transferred from such other fund or system to this Fund, plus (2) interest thereon at 6% per year compounded annually from the date of transfer to the date of payment.

(b) Alternative annuity. Any participant commissioner may elect to establish alternative credits for an alternative annuity by electing in writing to make additional optional contributions in accordance with this Section and procedures established by the Board. Unless and until such time as the U.S. Internal Revenue Service or the federal courts provide a favorable ruling as described in Section 13-502(f), a such commissioner may discontinue making the additional optional contributions by notifying the Fund in writing in accordance with this Section and procedures established by the Board.

Additional optional contributions for the alternative annuity shall be as follows:

(1) For service after the option is elected, an additional contribution of 3% of salary shall be contributed to the Fund on the same basis and under the same conditions as contributions required under Section 13-502.

(2) For contributions on past service, the additional contribution shall be 3% of the salary for the applicable period of service, plus interest at the annual rate from time to time as determined by the Board, compounded annually from the date of service to the date of payment. Contributions for service before the option is elected may be made in a lump sum payment to the Fund or by contributing to the Fund on the same basis and under the same conditions as contributions required under Section 13-502. All payments for past service must be paid in full before credit is given. No additional optional contributions may be made for any period of service for which credit has been previously forfeited by acceptance of a refund, unless the refund is repaid in full with interest at the rate specified in Section 13-603, from the date of refund to the date of repayment.

In lieu of the retirement annuity otherwise payable under this Article, any commissioner who has elected to participate in the Fund and make additional optional contributions in accordance with this Section, has attained age 55, and has at least 6 years of service credit, may elect to have the retirement annuity computed as follows: 3% of the participant's average final salary as a commissioner for each of the first 8 years of service credit, plus 4% of such salary for each of the next 4 years of service credit, plus 5% of such salary for each year of service credit in excess of 12 years, subject to a maximum of 80% of such salary. To the extent such commissioner has made additional optional contributions with respect to only a portion of years of service credit, the retirement annuity will first be determined in accordance with this Section to the extent such additional optional contributions were made, and then in accordance with the remaining Sections of this Article to the extent of years of service credit with respect to which additional optional contributions were not made. The change in minimum retirement age (from 60 to 55) made by this amendatory Act of 1993 applies to persons who begin receiving a retirement annuity under this Section on or after the effective date of this amendatory Act, without regard to whether they are in service on or after that date.

(c) Disability benefits. In lieu of the disability benefits otherwise payable under this Article, any commissioner who (1) has elected to participate in the Fund, and (2) has become permanently disabled and as a consequence is unable to perform the duties of office, and (3) was making optional contributions in accordance with this Section at the time the disability was incurred, may elect to receive a disability annuity calculated in accordance with the formula in subsection (b). For the purposes of this subsection, such commissioner shall be considered permanently disabled only if: (i) disability occurs while in service as a commissioner and is of such a nature as to prevent the reasonable performance of the duties of office at the time; and (ii) the Board has received a written certification by at least 2 licensed physicians appointed by it stating that such commissioner is disabled and that the disability is likely to be permanent.

(d) Alternative survivor's benefits. In lieu of the survivor's benefits otherwise payable under this Article, the spouse or eligible child of any deceased commissioner who (1) had elected to participate in the Fund, and (2) was either making additional optional contributions on the date of death, or was receiving an annuity calculated under this Section at the time of death, may elect to receive an annuity beginning on the date of the commissioner's death, provided that the spouse and commissioner must have been married on the date of the last termination of a service as commissioner and for a continuous period of at least one year immediately preceding death.

The annuity shall be payable beginning on the date of the commissioner's death if the spouse is then age 50 or over, or beginning at age 50 if the age of the spouse is less than 50 years. If a minor unmarried child or children of the commissioner, under age 18, also survive, and the child or children are under the care of the eligible spouse, the annuity shall begin as of the date of death of the commissioner without regard to the spouse's age.

The annuity to a spouse shall be 66 2/3% of the amount of retirement annuity earned by the commissioner on the date of death, subject to a minimum payment of 10% of salary, provided that if an eligible spouse, regardless of age, has in his or her care at the date of death of the commissioner any unmarried child or children of the commissioner under age 18, the minimum annuity shall be 30% of the commissioner's salary, plus 10% of salary on account of each minor child of the commissioner, subject to a combined total payment on account of a spouse and minor children not to exceed 50% of the deceased commissioner's salary. In the event there shall be no spouse of the commissioner surviving, or should a spouse die while eligible minor children still survive the commissioner, each such child shall be entitled to an annuity equal to 20% of salary of the commissioner subject to a combined total payment on account of all such children not to exceed 50% of salary of the commissioner. The salary to be used in the calculation of these benefits shall be the same as that prescribed for determining a retirement annuity as provided in subsection (b) of this Section.

Upon the death of a commissioner occurring after termination of a service or while in receipt of a retirement annuity, the combined total payment to a spouse and minor children, or to minor children alone if no eligible spouse survives, shall be limited to 75% of the amount of retirement annuity earned by the commissioner.

Adopted children shall have status as natural children of the commissioner only if the proceedings for adoption were commenced at least one year prior to the date of the commissioner's death.

Marriage of a child or attainment of age 18, whichever first occurs, shall render the child ineligible for further consideration in the payment of annuity to a spouse or in the increase in the amount thereof. Upon attainment of ineligibility of the youngest minor child of the commissioner, the annuity shall immediately revert to the amount payable upon death of a commissioner leaving no minor children surviving. If the spouse is under age 50 at such time, the annuity as revised shall be deferred until such age is attained.

(e) Refunds. Refunds of additional optional contributions shall be made on the same basis and under the same conditions as provided under Section 13-601. Interest shall be credited on the same basis and under the same conditions as for other contributions.

Optional contributions shall be accounted for in a separate Commission's Optional Contribution Reserve. Optional contributions under this Section shall be included in the amount of employee contributions used to compute the tax levy under Section 13-503.

(f) Effective date. The effective date of this plan of optional alternative benefits and contributions shall be the date upon which approval was received from the U.S. Internal Revenue Service. The plan of optional alternative benefits and contributions shall not be available to any former employee receiving an annuity from the Fund on the effective date, unless said former employee re-enters service and renders at least 3 years of additional service after the date of re-entry as a commissioner.

(Source: P.A. 90-12, eff. 6-13-97; 91-887, eff. 7-6-00.)

(40 ILCS 5/13-402) (from Ch. 108 1/2, par. 13-402)

Sec. 13-402. Length of service. For the purpose of computing the length of service for the retirement annuity, surviving spouse's annuity, and child's annuity, and calculating the minimum service requirement for payment of military service under subsection (b) of Section 13-403, service of 120 days in any one calendar year shall constitute one year of service and service for any fractional part thereof shall constitute an equal fractional part of one year of service unless specifically provided otherwise. For all other purposes under this Article, including but not limited to the optional plans of additional benefits and contributions provided under Sections 13-304, 13-304.1, and 13-314 of this Article, 26 pay periods of service during any 12 consecutive months shall constitute a year of service, and service rendered for 50% or more of a single pay period shall constitute service for the full pay period. Service of less than 50% of a single pay period shall not be counted.

(Source: P.A. 93-334, eff. 7-24-03.)

(40 ILCS 5/13-502) (from Ch. 108 1/2, par. 13-502)

Sec. 13-502. Employee contributions; deductions from salary.

(a) Retirement annuity and child's annuity. There shall be deducted from each payment of salary an amount equal to 7 1/2% of salary as the employee's contribution for the retirement annuity, including annual increases therefore and child's annuity.

(b) Surviving spouse's annuity. There shall be deducted from each payment of salary an amount equal to 1 1/2% of salary as the employee's contribution for the surviving spouse's annuity and annual increases therefor.

(c) Pickup of employee contributions. The Employer may pick up employee contributions required under subsections (a) and (b) of this Section. If contributions are picked up they shall be treated as Employer contributions in determining tax treatment under the United States Internal Revenue Code, and shall not be included as gross income of the employee until such time as they are distributed. The Employer shall pay these employee contributions from the same source of funds used in paying salary to the employee. The Employer may pick up these contributions by a reduction in the cash salary of the employee or by an offset against a future salary increase or by a combination of a reduction in salary and offset against a future salary increase. If employee contributions are picked up they shall be treated for all purposes of this Article 13, including Sections 13-503 and 13-601, in the same manner and to the same extent as employee contributions made prior to the date picked up.

(d) Subject to the requirements of federal law, the Employer shall pick up optional contributions that the employee has elected to pay to the Fund under Section 13-304.1, and the contributions so picked up shall be treated as employer contributions for the purposes of determining federal tax treatment. The Employer shall pick up the contributions by a reduction in the cash salary of the employee and shall pay the contributions from the same fund that is used to pay earnings to the employee. The Employer shall, however, continue to withhold federal and State income taxes based upon contributions made under Section 13-304.1 until the Internal Revenue Service or the federal courts rule that pursuant to Section 414(h) of the U.S. Internal Revenue Code of 1986, as amended, these contributions shall not be included as gross income of the employee until such time as they are distributed or made available.

(e) Each employee is deemed to consent and agree to the deductions from compensation provided for in this Article.

(f) Subject to the requirements of federal law, the Employer shall pick up contributions that a commissioner has elected to pay to the Fund under Section 13-314, and the contributions so picked up shall be treated as employer contributions for the purposes of determining federal tax treatment. The Employer shall pick up the contributions by a reduction in the cash salary of the commissioner and shall pay the contributions from the same fund as is used to pay earnings to the commissioner. The Employer shall, however, continue to withhold federal and State income taxes based upon contributions made under Section 13-314 until the U.S. Internal Revenue Service or the federal courts rule that pursuant to Section 414(h) of the Internal Revenue Code of 1986, as amended, these contributions shall not be included as gross income of the employee until such time as they are distributed or made available.

(Source: P.A. 92-599, eff. 6-28-02.)

(40 ILCS 5/13-601) (from Ch. 108 1/2, par. 13-601)

Sec. 13-601. Refunds.

(a) Withdrawal from service. Upon withdrawal from service, an employee under age 55 (age 50 if the employee first entered service before June 13, 1997), or an employee age 55 (age 50 if the employee first entered service before June 13, 1997) or over but less than 60 having less than 20 years of service, or an employee age 60 or over having less than 5 years of service shall be entitled, upon application, to a refund of total contributions from salary deductions or amounts otherwise paid under this Article by the employee. The refund shall not include interest credited to the contributions. The Board may, in its discretion, withhold payment of a refund for a period not to exceed one year from the date of filing an application for refund.

(b) Surviving spouse's annuity contributions. A refund of all amounts deducted from salary or otherwise contributed by an employee for the surviving spouse's annuity shall be paid upon retirement to any employee who on the date of retirement is either not married or is married but whose spouse is not eligible for a surviving spouse's annuity paid wholly or in part under this Article. The refund shall include interest on each contribution at the rate of 3% per annum compounded annually from the date of the contribution to the date of the refund.

(c) When paid to children, estate or beneficiary. Whenever the total accumulations, to the account of an employee from employee contributions, including interest, have not been paid to the employee and surviving spouse as a retirement or spouse's annuity before the death of the survivor of the employee and spouse, a refund shall be paid as follows: an amount equal to the excess of such amounts over the amounts paid on such annuities without interest on either such amount, shall be paid to the children of the employee, in equal parts to each, unless the employee has directed in writing, signed by him before an officer authorized to administer oaths, and filed with the Board before the employee's death, that any such amount shall be refunded and paid to any one or more of such children; and if there are not children, such other beneficiary or beneficiaries as might be designated by the employee. If there are no such children or designation of beneficiary, the refund shall be paid to the personal representative of the employee's estate.

If a personal representative of the estate has not been appointed within 90 days from the date on which a refund became payable, the refund may be applied, in the discretion of the Board, toward the payment of the employee's or the surviving spouse's burial expenses. Any remaining balance shall be paid to the heirs of the employee according to the law of descent and distribution of the State of Illinois.

If a reversionary annuity becomes payable under Section 13-303, the refund provided in this section shall not be paid until the death of the reversionary annuitant and the refund otherwise payable under this section shall be then further reduced by the amount of the reversionary annuity paid.

(d) In lieu of annuity. Notwithstanding the provisions set forth in subsection (a) of this section, whenever an employee's or surviving spouse's annuity will be less than $200 per month, the employee or surviving spouse, as the case may be, may elect to receive a refund of accumulated employee contributions; provided, however, that if the election is made by a surviving spouse the refund shall be reduced by any amounts theretofore paid to the employee in the form of an annuity.

(e) Forfeiture of rights. An employee or surviving spouse who receives a refund forfeits the right to receive an annuity or any other benefit payable under this Article except that if the refund is to a surviving spouse, any child or children of the employee shall not be deprived of the right to receive a child's annuity as provided in Section 13-308 of this Article, and the payment of a child's annuity shall not reduce the amount refundable to the surviving spouse.

(Source: P.A. 87-794; 87-1265.)

(40 ILCS 5/13-603) (from Ch. 108 1/2, par. 13-603)

Sec. 13-603. Restoration of rights. If an employee who has received a refund subsequently re-enters the service and renders one year of contributing service from the date of such re-entry, the employee shall be entitled to have restored all accumulation and service credits previously forfeited by making a repayment of the refund, including interest from the date of the refund to the date of repayment at a rate equal to the higher of 8% per annum or the actuarial investment return assumption used in the Fund's most recent Annual Actuarial Statement. Repayment may be made either directly to the Fund or in a manner similar to that provided for the contributions required under Section 13-502. The service credits represented thereby, or any part thereof, shall not become effective unless the full amount due has been paid by the employee, including interest. The repayment must be made in full no later than 90 days following the date of the employee's final withdrawal from service. If the employee fails to make a full repayment, any partial amounts paid by the employee shall be refunded without interest if the employee dies in service or withdraws.

(Source: P.A. 91-887, eff. 7-6-00.)

(40 ILCS 5/13-807) (from Ch. 108 1/2, par. 13-807)

Sec. 13-807. Felony conviction. None of the benefits provided in this Article shall be paid to any person who is convicted of any felony relating to or arising out of or in connection with service as an employee.

This section shall not operate to impair any contract or vested right heretofore acquired under any law or laws continued in this Article, nor to preclude a person's the right to a refund. For a person who enters service under the Fund on or after the effective date of this amendatory Act of the 93rd General Assembly, a refund under this Section shall consist of amounts representing employee contributions paid by the person to the Fund (including such amounts paid by the person to establish additional or optional credit), without interest, less the amount of benefits paid to the person (including benefits paid to an alternate payee under a QILDRO) by the Fund. The refund shall not include employer contributions or any interest on contributions. This Section does not require repayment to the Fund of any benefit paid before the date of the conviction.

All persons entering service subsequent to July 11, 1955 shall be deemed to have consented to the provisions of this Section as a condition of coverage.

(Source: P.A. 87-794.)

Section 90. The State Mandates Act is amended by adding Section 8.28 as follows:

(30 ILCS 805/8.28 new)

Sec. 8.28. 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 93rd General Assembly.

Section 99. Effective date. This Act takes effect upon becoming law.