HB4948 93RD GENERAL ASSEMBLY

LRB093 19851 LRD 45594 b

93RD GENERAL ASSEMBLY
State of Illinois
2003 and 2004
HB4948

Introduced 2/5/2004, by Robert S. Molaro

SYNOPSIS AS INTRODUCED:

40 ILCS 5/7-114	from Ch. 108 1/2, par. 7-114
40 ILCS 5/7-118	from Ch. 108 1/2, par. 7-118
40 ILCS 5/7-139	from Ch. 108 1/2, par. 7-139
40 ILCS 5/7-153.1 new
40 ILCS 5/7-170	from Ch. 108 1/2, par. 7-170
40 ILCS 5/7-171	from Ch. 108 1/2, par. 7-171
40 ILCS 5/7-173	from Ch. 108 1/2, par. 7-173
40 ILCS 5/7-205	from Ch. 108 1/2, par. 7-205
40 ILCS 5/7-211	from Ch. 108 1/2, par. 7-211
30 ILCS 805/8.28 new

Amends the IMRF Article of the Illinois Pension Code. Provides that any moneys received by an elected official from the State of Illinois for service in that capacity shall be deemed earnings unless specifically excluded. Changes the provisions defining and specifying the manner of designating a beneficiary. Removes obsolete language relating to the payment of federal social security contributions to the Fund. Makes a change in the required contribution for transfer of credits to IMRF from a downstate police pension fund for certain police chiefs who participate in IMRF. Provides that an employee whose disability determination or medical examination results are at issue before the Board may request that the portion of the Board meeting or committee hearing concerning the disability determination or medical examination be closed to the public. Provides that if a retiring employee has accumulated nonconcurrent service with more than one participating municipality or participating instrumentality, aggregate municipality charges shall be prorated among all nonfinal employers based on service credit and projected earnings with those employers and, for the final employer, municipality charges shall be based on the remaining cost of the employee's pension. Makes a technical correction. 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 concerning public employee benefits.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Pension Code is amended by changing Sections 7-114, 7-118, 7-139, 7-170, 7-171, 7-173, 7-205, and 7-211 and by adding Section 7-153.1 as follows:

(40 ILCS 5/7-114) (from Ch. 108 1/2, par. 7-114)

Sec. 7-114. Earnings. "Earnings":

(a) An amount to be determined by the board, equal to the sum of:

1. The total amount of money paid to an employee for personal services or official duties as an employee (except those employed as independent contractors) paid out of the general fund, or out of any special funds controlled by the municipality, or by any instrumentality thereof, or participating instrumentality, including compensation, fees, allowances, or other emolument paid for official duties (but not including automobile maintenance, travel expense, or reimbursements for expenditures incurred in the performance of duties) and, for fee offices, the fees or earnings of the offices to the extent such fees are paid out of funds controlled by the municipality, or instrumentality or participating instrumentality; and

2. The money value, as determined by rules prescribed by the governing body of the municipality, or instrumentality thereof, of any board, lodging, fuel, laundry, and other allowances provided an employee in lieu of money.

(b) For purposes of determining benefits payable under this fund payments to a person who is engaged in an independently established trade, occupation, profession or business and who is paid for his service on a basis other than a monthly or other regular salary, are not earnings.

(c) If a disabled participating employee is eligible to receive Workers' Compensation for an accidental injury and the participating municipality or instrumentality which employed the participating employee when injured continues to pay the participating employee regular salary or other compensation or pays the employee an amount in excess of the Workers' Compensation amount, then earnings shall be deemed to be the total payments, including an amount equal to the Workers' Compensation payments. These payments shall be subject to employee contributions and allocated as if paid to the participating employee when the regular payroll amounts would have been paid if the participating employee had continued working, and creditable service shall be awarded for this period.

(d) If an elected official who is a participating employee becomes disabled but does not resign and is not removed from office, then earnings shall include all salary payments made for the remainder of that term of office and the official shall be awarded creditable service for the term of office.

(e) If a participating employee is paid pursuant to "An Act to provide for the continuation of compensation for law enforcement officers, correctional officers and firemen who suffer disabling injury in the line of duty", approved September 6, 1973, as amended, the payments shall be deemed earnings, and the participating employee shall be awarded creditable service for this period.

(f) Additional compensation received by a person while serving as a supervisor of assessments, assessor, deputy assessor or member of a board of review from the State of Illinois pursuant to Section 4-10 or 4-15 of the Property Tax Code shall not be earnings for purposes of this Article and shall not be included in the contribution formula or calculation of benefits for such person pursuant to this Article.

(g) Any moneys received by an elected official from the State of Illinois for service in that capacity shall be deemed earnings unless specifically excluded in this Code.

(Source: P.A. 87-740; 88-670, eff. 12-2-94.)

(40 ILCS 5/7-118) (from Ch. 108 1/2, par. 7-118)

Sec. 7-118. "Beneficiary". :

(a) "Beneficiary" means:

(1) Any person or persons, trust, or charity designated as a beneficiary by an employee, former employee who has not yet received a retirement annuity or separation benefit, or employee annuitant. If no designation is on file or no beneficiary so designated survives, the estate of the employee, former employee who has not yet received a retirement annuity or separation benefit, or employee annuitant.

(2) Any person or persons, trust, or charity designated as a beneficiary by a beneficiary annuitant or, if no designation is on file or no beneficiary so designated survives, the estate of the beneficiary annuitant. The surviving spouse of an employee or of an employee annuitant, or if no surviving spouse survives, the person or persons designated by a participating employee or employee annuitant, or if no person so designated survives, or if no designation is on file, the estate of the employee or employee annuitant. The person or persons designated by a beneficiary annuitant, or if no person designated survives, or if no designation is on file, the estate of the beneficiary annuitant.

(3) The estate of a surviving spouse annuitant where the employee or employee annuitant filed no designation, or no person designated survives at the death of a surviving spouse annuitant.

(b) Designations of beneficiaries shall be in writing on forms prescribed by the board and effective upon filing in the fund offices. The designation forms shall provide for contingent beneficiaries. Divorce, dissolution or annulment of marriage revokes the designation of an employee's former spouse as a beneficiary on a designation executed before entry of judgment for divorce, dissolution or annulment of marriage.

(b) Notwithstanding the foregoing, an employee, former employee who has not yet received a retirement annuity or separation benefit, or employee annuitant may elect to name any person, trust or charity to be the primary beneficiary of any death benefit payable by reason of his death. Such election shall state specifically whether it is his intention to exclude the spouse, shall be in writing, and may be revoked at any time. Such election or revocation shall take effect upon being filed in the fund offices.

(c) If a surviving spouse annuity is payable to a former spouse upon the death of an employee annuitant, the former spouse, unless designated by the employee annuitant after dissolution of the marriage, shall not be the beneficiary for the purposes of the $3,000 death benefit payable under subparagraph 6 of Section 7-164. This benefit shall be paid to the designated beneficiary of the employee annuitant or, if there is no designation, then to the estate of the employee annuitant.

(Source: P.A. 89-136, eff. 7-14-95; 90-448, eff. 8-16-97.)

(40 ILCS 5/7-139) (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.

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: Except as otherwise provided in paragraph 10, 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.

10. For service transferred from Article 3 by persons first joining the Fund on or after the effective date of this amendatory Act of the 93rd General Assembly pursuant to an election under Section 3-109.1: Credits and creditable service shall be granted for service under Article 3 of this Code to an active member of this Fund upon transfer of such credits pursuant to Section 3-110.3 and payment by the member of the amount by which (1) the present actuarial value of the increase in benefits resulting from the transfer, determined by the Board as of the time of the transfer, exceeds (2) the amount actually transferred to the Fund under Section 3-110.3. The 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.)

(40 ILCS 5/7-153.1 new)

Sec. 7-153.1. Disability hearings; request for closed meeting. Those portions of meetings of the Board or of Board committees in which matters relating to the determination of disability or the results of medical examinations are to be considered may be closed, but only if the request for a closed meeting is initiated by the participating employee whose disability determination or whose medical examination results are at issue.

(40 ILCS 5/7-170) (from Ch. 108 1/2, par. 7-170)

Sec. 7-170. Federal Social Security coverage.

(a) It is declared to be the policy and purpose of this Section to extend to covered employees as defined in Section 7-138, the benefits of the Federal Old Age and Survivors Insurance System as authorized by the Federal Social Security Act and amendments thereto. To effect this, the board shall take such action as may be required by applicable State and Federal laws or regulations.

(b) The board shall execute an agreement with the State Agency to secure coverage of covered employees as provided in paragraph (a) of this section.

(c) Each participating municipality and each participating instrumentality shall remit payment of contributions for Social Security purposes on behalf of covered employees and covered municipalities and participating instrumentalities in the manner provided by law as required by the board and the State Agency established by the Social Security Enabling Act.

(d) (Blank). Contributions of covered employees to this fund for Federal Social Security purposes shall be paid to the State Agency in such amounts and at such time as are designated by State laws or regulations.

(e) (Blank). Contributions in behalf of covered municipalities and participating instrumentalities for Federal Social Security purposes and the required pro rata share of administrative expenses shall be paid to the State Agency from this fund in accordance with applicable State laws and regulations.

(f) The board shall maintain such records and submit such reports as may be required by applicable State and Federal laws or regulations.

(Source: P.A. 81-793.)

(40 ILCS 5/7-171) (from Ch. 108 1/2, par. 7-171)

Sec. 7-171. Finance; taxes.

(a) Each municipality other than a school district shall appropriate an amount sufficient to provide for the current municipality contributions required by Section 7-172 of this Article, for the fiscal year for which the appropriation is made and all amounts due for municipal contributions for previous years. Those municipalities which have been assessed an annual amount to amortize its unfunded obligation, as provided in subparagraph 4 5 of paragraph (a) of Section 7-172 of this Article, shall include in the appropriation an amount sufficient to pay the amount assessed. The appropriation shall be based upon an estimate of assets available for municipality contributions and liabilities therefor for the fiscal year for which appropriations are to be made, including funds available from levies for this purpose in prior years.

(b) For the purpose of providing monies for municipality contributions, beginning for the year in which a municipality is included in this fund:

(1) A municipality other than a school district may levy a tax which shall not exceed the amount appropriated for municipality contributions.

(2) A school district may levy a tax in an amount reasonably calculated at the time of the levy to provide for the municipality contributions required under Section 7-172 of this Article for the fiscal years for which revenues from the levy will be received and all amounts due for municipal contributions for previous years. Any levy adopted before the effective date of this amendatory Act of 1995 by a school district shall be considered valid and authorized to the extent that the amount was reasonably calculated at the time of the levy to provide for the municipality contributions required under Section 7-172 for the fiscal years for which revenues from the levy will be received and all amounts due for municipal contributions for previous years. In no event shall a budget adopted by a school district limit a levy of that school district adopted under this Section.

(c) Any county which is served by a regional office of education that serves 2 or more counties may include in its appropriation an amount sufficient to provide its proportionate share of the municipality contributions for that regional office of education. The tax levy authorized by this Section may include an amount necessary to provide monies for this contribution.

(d) Any county that is a part of a multiple-county health department or consolidated health department which is formed under "An Act in relation to the establishment and maintenance of county and multiple-county public health departments", approved July 9, 1943, as amended, and which is a participating instrumentality may include in the county's appropriation an amount sufficient to provide its proportionate share of municipality contributions of the department. The tax levy authorized by this Section may include the amount necessary to provide monies for this contribution.

(d-5) A school district participating in a special education joint agreement created under Section 10-22.31 of the School Code that is a participating instrumentality may include in the school district's tax levy under this Section an amount sufficient to provide its proportionate share of the municipality contributions for current and prior service by employees of the participating instrumentality created under the joint agreement.

(e) Such tax shall be levied and collected in like manner, with the general taxes of the municipality and shall be in addition to all other taxes which the municipality is now or may hereafter be authorized to levy upon all taxable property therein, and shall be exclusive of and in addition to the amount of tax levied for general purposes under Section 8-3-1 of the "Illinois Municipal Code", approved May 29, 1961, as amended, or under any other law or laws which may limit the amount of tax which the municipality may levy for general purposes. The tax may be levied by the governing body of the municipality without being authorized as being additional to all other taxes by a vote of the people of the municipality.

(f) The county clerk of the county in which any such municipality is located, in reducing tax levies shall not consider any such tax as a part of the general tax levy for municipality purposes, and shall not include the same in the limitation of any other tax rate which may be extended.

(g) The amount of the tax to be levied in any year shall, within the limits herein prescribed, be determined by the governing body of the respective municipality.

(h) The revenue derived from any such tax levy shall be used only for the purposes specified in this Article and, as collected, shall be paid to the treasurer of the municipality levying the tax. Monies received by a county treasurer for use in making contributions to a regional office of education for its municipality contributions shall be held by him for that purpose and paid to the regional office of education in the same manner as other monies appropriated for the expense of the regional office.

(Source: P.A. 89-329, eff. 8-17-95; 90-448, eff. 8-16-97; 90-511, eff. 8-22-97; 90-655, eff. 7-30-98.)

(40 ILCS 5/7-173) (from Ch. 108 1/2, par. 7-173)

Sec. 7-173. Contributions by employees.

(a) Each participating employee shall make contributions to the fund as follows:

1. For retirement annuity purposes, normal contributions of 3 3/4% of earnings.

2. Additional contributions of such percentages of each payment of earnings, as shall be elected by the employee for retirement annuity purposes, but not in excess of 10%. The selected rate shall be applicable to all earnings beginning on the first day of the second month following receipt by the Board of written notice of election to make such contributions. Additional contributions at the selected rate shall be made concurrently with normal contributions.

3. Survivor contributions, by each participating employee, of 3/4% of each payment of earnings.

(b) Each employee shall make contributions to the fund for Federal Social Security taxes, for periods during which he is a covered employee, as required by the Social Security Enabling Act and federal law. For participating employees, such contributions shall be in addition to those required under paragraph (a) of this Section.

(c) Contributions shall be deducted from each corresponding payment of earnings paid to each employee and shall be remitted to the board by the participating municipality or participating instrumentality making such payment. The remittance, together with a report of the earnings and contributions shall be made as directed by the board. For township treasurers and employees of township treasurers qualifying as employees hereunder, the contributions herein required as deductions from salary shall be withheld by the school township trustees from funds available for the payment of the compensation of such treasurers and employees as provided in the School Code and remitted to the board.

(d) An employee who has made additional contributions under paragraph (a)2 of this Section may upon retirement or at any time prior thereto, elect to withdraw the total of such additional contributions including interest credited thereon to the end of the preceding calendar year.

(e) Failure to make the deductions for employee contributions provided in paragraph (c) of this Section shall not relieve the employee from liability for such contributions. The amount of such liability may be deducted, with interest charged under Section 7-209, from any annuities or benefits payable hereunder to the employee or any other person receiving an annuity or benefit by reason of such employee's participation.

(f) A participating employee who has at least 40 years of creditable service in the Fund may elect to cease making the contributions required under this Section. The status of the employee under this Article shall be unaffected by this election, except that the employee shall not receive any additional creditable service for the periods of employment following the election. An election under this subsection relieves the employer from making additional employer contributions in relation to that employee.

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

(40 ILCS 5/7-205) (from Ch. 108 1/2, par. 7-205)

Sec. 7-205. Reserves for annuities. Appropriate reserves shall be created for payment of all annuities granted under this Article at the time such annuities are granted and in amounts determined to be necessary under actuarial tables adopted by the Board upon recommendation of the actuary of the fund. All annuities payable shall be charged to the annuity reserve.

1. Amounts credited to annuity reserves shall be derived by transfer of all the employee credits from the appropriate employee reserves and by charges to the municipality reserve of those municipalities in which the retiring employee has accumulated service. If a retiring employee has accumulated service in more than one participating municipality or participating instrumentality, (i) in the case of concurrent service, aggregate municipality charges shall be prorated on a basis of the employee's earnings in case of concurrent service and (ii) in the case of nonconcurrent service, aggregate municipality charges shall be prorated among all nonfinal employers on a basis of service credit and projected earnings with those employers and, for the final employer, municipality charges shall be paid on a basis of the remaining cost of the employee's pension, as determined by the Board. creditable service in other cases.

2. Supplemental annuities shall be handled as a separate annuity and amounts to be credited to the annuity reserve therefor shall be derived in the same manner as a regular annuity.

3. When a retirement annuity is granted to an employee with a spouse eligible for a surviving spouse annuity, there shall be credited to the annuity reserve an amount to fund the cost of both the retirement and surviving spouse annuity as a joint and survivors annuity.

4. Beginning January 1, 1989, when a retirement annuity is awarded, an amount equal to the present value of the $3,000 death benefit payable upon the death of the annuitant shall be transferred to the annuity reserve from the appropriate municipality reserves in the same manner as the transfer for annuities.

5. All annuity reserves shall be revalued annually as of December 31. Beginning as of December 31, 1973, adjustment required therein by such revaluation shall be charged or credited to the earnings and experience variation reserve.

6. There shall be credited to the annuity reserve all of the payments made by annuitants under Section 7-144.2, plus an additional amount from the earnings and experience variation reserve to fund the cost of the incremental annuities granted to annuitants making these payments.

7. As of December 31, 1972, the excess in the annuity reserve shall be transferred to the municipality reserves. An amount equal to the deficiency in the reserve of participating municipalities and participating instrumentalities which have no participating employees shall be allocated to their reserves. The remainder shall be allocated in amounts proportionate to the present value, as of January 1, 1972, of annuities of annuitants of the remaining participating municipalities and participating instrumentalities.

(Source: P.A. 89-136, eff. 7-14-95.)

(40 ILCS 5/7-211) (from Ch. 108 1/2, par. 7-211)

Sec. 7-211. Authorizations.

(a) Each participating municipality and instrumentality thereof and each participating instrumentality shall:

1. Deduct all normal and additional contributions and contributions for federal Social Security taxes as required by the Social Security Enabling Act from each payment of earnings payable to each participating employee who is entitled to any earnings from such municipality or instrumentality thereof or participating instrumentality, and remit all such normal and additional contributions immediately to the board and all such contributions for federal Social Security taxes in the manner provided by law; and

2. Pay to the board contributions required by this Article.

(b) Each participating employee shall, by virtue of the payment of contributions to this fund, receive a vested interest in the annuities and benefits provided in this Article and in consideration of such vested interest shall be deemed to have agreed and authorized the deduction from earnings of all contributions payable to this fund in accordance with this Article.

(c) Payment of earnings less the amounts of contributions provided in this Article and in the Social Security Enabling Act shall be a full and complete discharge of all claims for payment for services rendered by any employee during the period covered by any such payment.

(d) Any covered annuitant may authorize the withholding of all or a portion of his or her annuity, for the payment of premiums on group accident and health insurance provided pursuant to Section 7-199.1. The annuitant may revoke this authorization at any time.

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

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.