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1 | AN ACT concerning public employee benefits.
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2 | Be it enacted by the People of the State of Illinois,
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3 | represented in the General Assembly:
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4 | Section 5. The Illinois Pension Code is amended by changing | ||||||
5 | Section 7-139 as follows:
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6 | (40 ILCS 5/7-139) (from Ch. 108 1/2, par. 7-139)
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7 | Sec. 7-139. Credits and creditable service to employees.
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8 | (a) Each participating employee shall be granted credits | ||||||
9 | and creditable
service, for purposes of determining the amount | ||||||
10 | of any annuity or benefit
to which he or a beneficiary is | ||||||
11 | entitled, as follows:
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12 | 1. For prior service: Each participating employee who | ||||||
13 | is an employee
of a participating municipality or | ||||||
14 | participating instrumentality on the
effective date shall | ||||||
15 | be granted creditable service, but no credits under
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16 | paragraph 2 of this subsection (a), for periods of prior | ||||||
17 | service for which
credit has not been received under any | ||||||
18 | other pension fund or retirement system
established under | ||||||
19 | this Code, as follows:
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20 | If the effective date of participation for the | ||||||
21 | participating municipality
or participating | ||||||
22 | instrumentality is on or before January 1, 1998, creditable
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23 | service shall be granted for the entire period of prior |
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1 | service with that
employer without any employee | ||||||
2 | contribution.
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3 | If the effective date of participation for the | ||||||
4 | participating municipality
or participating | ||||||
5 | instrumentality is after January 1, 1998, creditable
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6 | service shall be granted for the last 20% of the period of | ||||||
7 | prior service with
that employer, but no more than 5 years, | ||||||
8 | without any employee contribution. A
participating | ||||||
9 | employee may establish creditable service for the | ||||||
10 | remainder of
the period of prior service with that employer | ||||||
11 | by making an application in
writing, accompanied by payment | ||||||
12 | of an employee contribution in an
amount determined by the | ||||||
13 | Fund, based on the employee contribution rates in
effect at | ||||||
14 | the time of application for the creditable service and the | ||||||
15 | employee's
salary rate on the effective date of | ||||||
16 | participation for that employer, plus
interest at the | ||||||
17 | effective rate from the date of the prior service to the | ||||||
18 | date
of payment. Application for this creditable service | ||||||
19 | may be made at any time
while the employee is still in | ||||||
20 | service.
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21 | A municipality that (i) has at least 35 employees; (ii) | ||||||
22 | is located in a county with at least 2,000,000 inhabitants; | ||||||
23 | and (iii) maintains an independent defined benefit pension | ||||||
24 | plan for the benefit of its eligible employees may restrict | ||||||
25 | creditable service in whole or in part for periods of prior | ||||||
26 | service with the employer if the governing body of the |
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1 | municipality adopts an irrevocable resolution to restrict | ||||||
2 | that creditable service and files the resolution with the | ||||||
3 | board before the municipality's effective date of | ||||||
4 | participation.
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5 | Any person who has withdrawn from the service of a | ||||||
6 | participating
municipality
or participating | ||||||
7 | instrumentality prior to the effective date, who reenters
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8 | the service of the same municipality or participating | ||||||
9 | instrumentality after
the effective date and becomes a | ||||||
10 | participating employee is entitled to
creditable service | ||||||
11 | for prior service as otherwise provided in this
subdivision | ||||||
12 | (a)(1) only if he or she renders 2 years of service as a
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13 | participating employee after the effective date. | ||||||
14 | Application
for such service must be made while in a | ||||||
15 | participating status.
The salary rate to be used in the | ||||||
16 | calculation of the required employee
contribution, if any, | ||||||
17 | shall be the employee's salary rate at the time of first
| ||||||
18 | reentering service with the employer after the employer's | ||||||
19 | effective date of
participation.
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20 | 2. For current service, each participating employee | ||||||
21 | shall be
credited with:
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22 | a. Additional credits of amounts equal to each | ||||||
23 | payment of additional
contributions received from him | ||||||
24 | under Section 7-173, as of the
date the corresponding | ||||||
25 | payment of earnings is payable to him.
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26 | b. Normal credits of amounts equal to each payment |
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1 | of normal
contributions received from him, as of the | ||||||
2 | date the corresponding payment of
earnings is payable | ||||||
3 | to him, and normal contributions made for the purpose | ||||||
4 | of
establishing out-of-state service credits as | ||||||
5 | permitted under the conditions set
forth in paragraph 6 | ||||||
6 | of this subsection (a).
| ||||||
7 | c. Municipality credits in an amount equal to 1.4 | ||||||
8 | times the normal
credits, except those established by | ||||||
9 | out-of-state service credits, as of
the date of | ||||||
10 | computation of any benefit if these credits would | ||||||
11 | increase
the benefit.
| ||||||
12 | d. Survivor credits equal to each payment of | ||||||
13 | survivor contributions
received from the participating | ||||||
14 | employee as of the date the
corresponding payment of | ||||||
15 | earnings is payable, and survivor contributions made
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16 | for the purpose of establishing out-of-state service | ||||||
17 | credits.
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18 | 3. For periods of temporary and total and permanent | ||||||
19 | disability
benefits, each employee receiving disability | ||||||
20 | benefits shall be granted
creditable service for the period | ||||||
21 | during which disability benefits are
payable. Normal and | ||||||
22 | survivor credits, based upon the rate of earnings
applied | ||||||
23 | for disability benefits, shall also be granted if such | ||||||
24 | credits
would result in a higher benefit to any such | ||||||
25 | employee or his
beneficiary.
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26 | 4. For authorized leave of absence without pay: A |
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1 | participating
employee shall be granted credits and | ||||||
2 | creditable service for periods of
authorized leave of | ||||||
3 | absence without pay under the following
conditions:
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4 | a. An application for credits and creditable | ||||||
5 | service is submitted to the
board while the employee is | ||||||
6 | in a status of
active employment, and within 2 years | ||||||
7 | after termination of the
leave of absence period for | ||||||
8 | which credits and creditable service are
sought.
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9 | b. Not more than 12 complete months of creditable | ||||||
10 | service
for authorized leave of absence without pay | ||||||
11 | shall be counted for purposes of
determining any | ||||||
12 | benefits payable under this Article.
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13 | c. Credits and creditable service shall be granted | ||||||
14 | for leave of
absence only if such leave is approved by | ||||||
15 | the governing body of the
municipality, including | ||||||
16 | approval of the estimated cost thereof to the
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17 | municipality as determined by the fund, and employee | ||||||
18 | contributions, plus
interest at the effective rate | ||||||
19 | applicable for each year from the end of
the period of | ||||||
20 | leave to date of payment, have been paid to the fund in
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21 | accordance with Section 7-173. The contributions shall | ||||||
22 | be computed upon the
assumption earnings continued | ||||||
23 | during the period of leave at the rate in
effect when | ||||||
24 | the leave began.
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25 | d. Benefits under the provisions of Sections | ||||||
26 | 7-141, 7-146, 7-150
and 7-163 shall become payable to |
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1 | employees on authorized leave of
absence, or their | ||||||
2 | designated beneficiary, only if such leave of absence
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3 | is creditable hereunder, and if the employee has at | ||||||
4 | least one year of
creditable service other than the | ||||||
5 | service granted for leave of absence.
Any employee | ||||||
6 | contributions due may be deducted from any benefits
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7 | payable.
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8 | e. No credits or creditable service shall be | ||||||
9 | allowed for leave of
absence without pay during any | ||||||
10 | period of prior service.
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11 | 5. For military service: The governing body of a | ||||||
12 | municipality or
participating instrumentality may elect to | ||||||
13 | allow creditable service to
participating employees who | ||||||
14 | leave their employment to serve in the armed
forces of the | ||||||
15 | United States for all periods of such service, provided
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16 | that the person returns to active employment within 90 days | ||||||
17 | after
completion
of full time active duty, but no | ||||||
18 | creditable service shall be allowed such
person for any | ||||||
19 | period that can be used in the computation of a pension
or | ||||||
20 | any other pay or benefit, other than pay for active duty, | ||||||
21 | for service
in any branch of the armed forces of the United | ||||||
22 | States. If necessary to
the computation of any benefit, the | ||||||
23 | board shall establish municipality
credits for | ||||||
24 | participating employees under this paragraph on the
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25 | assumption that the employee received earnings at the rate | ||||||
26 | received at
the time he left the employment to enter the |
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1 | armed forces. A
participating employee in the armed forces | ||||||
2 | shall not be considered an
employee during such period of | ||||||
3 | service and no additional death and no
disability benefits | ||||||
4 | are payable for death or disability during such period.
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5 | Any participating employee who left his employment | ||||||
6 | with a
municipality or participating instrumentality to | ||||||
7 | serve in the armed
forces of the United States and who | ||||||
8 | again became a participating
employee within 90 days after | ||||||
9 | completion of full time active duty by
entering the service | ||||||
10 | of a different municipality or participating
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11 | instrumentality, which has elected to allow creditable | ||||||
12 | service for
periods of military service under the preceding | ||||||
13 | paragraph, shall also be
allowed creditable service for his | ||||||
14 | period of military service on the
same terms that would | ||||||
15 | apply if he had been employed, before entering
military | ||||||
16 | service, by the municipality or instrumentality which | ||||||
17 | employed
him after he left the military service and the | ||||||
18 | employer costs arising in
relation to such grant of | ||||||
19 | creditable service shall be charged to and
paid by that | ||||||
20 | municipality or instrumentality.
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21 | Notwithstanding the foregoing, any participating | ||||||
22 | employee
shall be entitled to creditable service as | ||||||
23 | required by any federal law
relating to re-employment | ||||||
24 | rights of persons who served in the United States
Armed | ||||||
25 | Services. Such creditable service shall be granted upon | ||||||
26 | payment by
the member of an amount equal to the employee |
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1 | contributions which would
have been required had the | ||||||
2 | employee continued in service at the same
rate of earnings | ||||||
3 | during the military leave period, plus interest at
the | ||||||
4 | effective rate.
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5 | 5.1. In addition to any creditable service established | ||||||
6 | under
paragraph 5 of this subsection (a), creditable | ||||||
7 | service may be granted for
up to 48
24 months of service in | ||||||
8 | the armed forces of the United States.
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9 | In order to receive creditable service for military | ||||||
10 | service under this
paragraph 5.1, a participating employee | ||||||
11 | must (1) apply to the Fund
in writing and provide evidence | ||||||
12 | of the military service that is satisfactory
to the Board; | ||||||
13 | (2) obtain the written approval of the current employer; | ||||||
14 | and (3)
make contributions to the Fund equal to (i)
the | ||||||
15 | employee contributions that would have been required had | ||||||
16 | the service been
rendered as a member, plus (ii) an amount | ||||||
17 | determined by the board to be equal
to the employer's | ||||||
18 | normal cost of the benefits accrued for that military
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19 | service, plus (iii) interest on items (i) and (ii) from the | ||||||
20 | date of first
membership in the Fund to the date of | ||||||
21 | payment. If payment is made during
the 6-month period that | ||||||
22 | begins
3 months after the effective date of this
amendatory | ||||||
23 | Act of
1997, the required interest shall be at the rate of | ||||||
24 | 2.5%
per year, compounded annually; otherwise, the | ||||||
25 | required interest shall be
calculated at the regular | ||||||
26 | interest rate.
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1 | The changes made to this paragraph 5.1 by this | ||||||
2 | amendatory Act of the 95th General Assembly apply only to | ||||||
3 | participating employees in service on or after its | ||||||
4 | effective date.
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5 | 6. For out-of-state service: Creditable service shall | ||||||
6 | be granted for
service rendered to an out-of-state local | ||||||
7 | governmental body under the
following conditions: The | ||||||
8 | employee had participated and has irrevocably
forfeited | ||||||
9 | all rights to benefits in the out-of-state public employees
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10 | pension system; the governing body of his participating | ||||||
11 | municipality or
instrumentality authorizes the employee to | ||||||
12 | establish such service; the
employee has 2 years current | ||||||
13 | service with this municipality or
participating | ||||||
14 | instrumentality; the employee makes a payment of
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15 | contributions, which shall be computed at 8% (normal) plus | ||||||
16 | 2% (survivor)
times length of service purchased times the | ||||||
17 | average rate of earnings for the
first 2
years of service | ||||||
18 | with the municipality or participating
instrumentality | ||||||
19 | whose governing body authorizes the service established
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20 | plus interest at the effective rate on the date such | ||||||
21 | credits are
established, payable from the date the employee | ||||||
22 | completes the required 2
years of current service to date | ||||||
23 | of payment. In no case shall more than
120 months of | ||||||
24 | creditable service be granted under this provision.
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25 | 7. For retroactive service: Any employee who could have | ||||||
26 | but did not
elect to become a participating employee, or |
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1 | who should have been a
participant in the Municipal Public | ||||||
2 | Utilities Annuity and Benefit Fund
before that fund was | ||||||
3 | superseded, may receive creditable service for the
period | ||||||
4 | of service not to exceed 50 months; however, a current or | ||||||
5 | former
elected or appointed official of a participating | ||||||
6 | municipality may establish credit under this paragraph 7 | ||||||
7 | for more than 50
months of service as an official of that | ||||||
8 | municipality, if the excess over 50 months is approved by | ||||||
9 | resolution of the
governing body of the affected | ||||||
10 | municipality filed with
the Fund before January 1, 2002.
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11 | Any employee who is a
participating employee on or | ||||||
12 | after September 24, 1981 and who was
excluded from | ||||||
13 | participation by the age restrictions removed by Public Act
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14 | 82-596 may receive creditable service for the period, on or | ||||||
15 | after January
1, 1979, excluded by the age restriction and, | ||||||
16 | in addition, if the governing
body of the participating | ||||||
17 | municipality or participating instrumentality elects
to | ||||||
18 | allow creditable service for all employees excluded by the | ||||||
19 | age restriction
prior to January 1, 1979, for service | ||||||
20 | during the period prior to that date
excluded by the age | ||||||
21 | restriction. Any employee who was excluded from
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22 | participation by the age restriction removed by Public Act | ||||||
23 | 82-596 and who is
not a participating employee on or after | ||||||
24 | September 24, 1981 may receive
creditable service for | ||||||
25 | service after January 1,
1979. Creditable service under | ||||||
26 | this paragraph
shall be granted upon payment of the |
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1 | employee contributions
which would have been required had | ||||||
2 | he participated, with interest at the
effective rate for | ||||||
3 | each year from the end of the period of service
established | ||||||
4 | to date of payment.
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5 | 8. For accumulated unused sick leave: A participating | ||||||
6 | employee who is
applying for a retirement annuity shall be | ||||||
7 | entitled to creditable service
for that portion of the | ||||||
8 | employee's accumulated unused sick leave
for which payment | ||||||
9 | is not received, as follows:
| ||||||
10 | a. Sick leave days shall be limited to those | ||||||
11 | accumulated under a sick
leave plan established by a | ||||||
12 | participating municipality or participating
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13 | instrumentality which is available to all employees or | ||||||
14 | a class of employees.
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15 | b. Only sick leave days accumulated with a | ||||||
16 | participating municipality or
participating | ||||||
17 | instrumentality with which the employee was in service | ||||||
18 | within
60 days of the effective date of his retirement | ||||||
19 | annuity shall be credited;
If the employee was in | ||||||
20 | service with more than one employer during this
period | ||||||
21 | only the sick leave days with the employer with which | ||||||
22 | the employee
has the greatest number of unpaid sick | ||||||
23 | leave days shall be considered.
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24 | c. The creditable service granted shall be | ||||||
25 | considered solely for the
purpose of computing the | ||||||
26 | amount of the retirement annuity and shall not be
used |
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1 | to establish any minimum service period required by any | ||||||
2 | provision of the
Illinois Pension Code, the effective | ||||||
3 | date of the retirement annuity, or the
final rate of | ||||||
4 | earnings.
| ||||||
5 | d. The creditable service shall be at the rate of | ||||||
6 | 1/20 of a month for
each full sick day, provided that | ||||||
7 | no more than 12 months may be credited
under this | ||||||
8 | subdivision 8.
| ||||||
9 | e. Employee contributions shall not be required | ||||||
10 | for creditable service
under this subdivision 8.
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11 | f. Each participating municipality and | ||||||
12 | participating instrumentality
with which an employee | ||||||
13 | has service within 60 days of the effective date of
his | ||||||
14 | retirement annuity shall certify to the board the | ||||||
15 | number of accumulated
unpaid sick leave days credited | ||||||
16 | to the employee at the time of termination
of service.
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17 | 9. For service transferred from another system: | ||||||
18 | Credits and
creditable service shall be granted for service | ||||||
19 | under Article 3, 4, 5, 14
or 16 of this Act, to any active | ||||||
20 | member of this Fund, and to any
inactive member who has | ||||||
21 | been a county sheriff, upon
transfer of such credits | ||||||
22 | pursuant to Section 3-110.3, 4-108.3, 5-235,
14-105.6 or | ||||||
23 | 16-131.4, and payment by the member of the amount by
which | ||||||
24 | (1) the employer and employee contributions that would have | ||||||
25 | been required
if he had participated in this Fund as a | ||||||
26 | sheriff's law enforcement employee
during the period for |
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| |||||||
1 | which credit is
being transferred, plus interest thereon at | ||||||
2 | the effective rate for each
year, compounded annually, from | ||||||
3 | the date of termination of the service for
which credit is | ||||||
4 | being transferred to the date of payment, exceeds (2) the
| ||||||
5 | amount actually transferred to the Fund.
Such transferred | ||||||
6 | service shall be deemed to be service as a sheriff's law
| ||||||
7 | enforcement employee for the purposes of Section 7-142.1.
| ||||||
8 | 10. For service transferred from an Article 3 system | ||||||
9 | under Section 3-110.8: Credits and
creditable service | ||||||
10 | shall be granted for service under Article 3 of this Act as | ||||||
11 | provided in Section 3-110.8, to any active member of this | ||||||
12 | Fund upon
transfer of such credits pursuant to Section | ||||||
13 | 3-110.8. If the amount by
which (1) the employer and | ||||||
14 | employee contributions that would have been required
if he | ||||||
15 | had participated in this Fund during the period for which | ||||||
16 | credit is
being transferred, plus interest thereon at the | ||||||
17 | effective rate for each
year, compounded annually, from the | ||||||
18 | date of termination of the service for
which credit is | ||||||
19 | being transferred to the date of payment, exceeds (2) the
| ||||||
20 | amount actually transferred to the Fund, then the amount of | ||||||
21 | creditable service established under this paragraph 10 | ||||||
22 | shall be reduced by a corresponding amount in accordance | ||||||
23 | with the rules and procedures established under this | ||||||
24 | paragraph 10.
| ||||||
25 | The board shall establish by rule the manner of making | ||||||
26 | the calculation required under
this paragraph 10, taking |
| |||||||
| |||||||
1 | into account the appropriate actuarial
assumptions; the | ||||||
2 | member's service, age, and salary history; the level
of | ||||||
3 | funding of the employer; and
any other factors that the | ||||||
4 | board determines to be relevant.
| ||||||
5 | (b) Creditable service - amount:
| ||||||
6 | 1. One month of creditable service
shall be allowed for | ||||||
7 | each month for which a participating employee made
| ||||||
8 | contributions as required under Section 7-173, or for which | ||||||
9 | creditable
service is otherwise granted hereunder. Not | ||||||
10 | more than 1 month of
service shall be credited and counted | ||||||
11 | for 1 calendar month, and not more
than 1 year of service | ||||||
12 | shall be credited and counted for any calendar
year. A | ||||||
13 | calendar month means a nominal month beginning on the first | ||||||
14 | day
thereof, and a calendar year means a year beginning | ||||||
15 | January 1 and ending
December 31.
| ||||||
16 | 2. A seasonal employee shall be given 12 months of | ||||||
17 | creditable
service if he renders the number of months of | ||||||
18 | service normally required
by the position in a 12-month | ||||||
19 | period and he remains in service for the
entire 12-month | ||||||
20 | period. Otherwise a fractional year of service in the
| ||||||
21 | number of months of service rendered shall be credited.
| ||||||
22 | 3. An intermittent employee shall be given creditable | ||||||
23 | service for
only those months in which a contribution is | ||||||
24 | made under Section 7-173.
| ||||||
25 | (c) No application for correction of credits or creditable | ||||||
26 | service shall
be considered unless the board receives an |
| |||||||
| |||||||
1 | application for correction while
(1) the applicant is a | ||||||
2 | participating employee and in active employment
with a | ||||||
3 | participating municipality or instrumentality, or (2) while | ||||||
4 | the
applicant is actively participating in a pension fund or | ||||||
5 | retirement
system which is a participating system under the | ||||||
6 | Retirement Systems
Reciprocal Act. A participating employee or | ||||||
7 | other applicant shall not be
entitled to credits or creditable | ||||||
8 | service unless the required employee
contributions are made in | ||||||
9 | a lump sum or in installments made in accordance
with board | ||||||
10 | rule.
| ||||||
11 | (d) Upon the granting of a retirement, surviving spouse or | ||||||
12 | child
annuity, a death benefit or a separation benefit, on | ||||||
13 | account of any
employee, all individual accumulated credits | ||||||
14 | shall thereupon terminate.
Upon the withdrawal of additional | ||||||
15 | contributions, the credits applicable
thereto shall thereupon | ||||||
16 | terminate. Terminated credits shall not be applied
to increase | ||||||
17 | the benefits any remaining employee would otherwise receive | ||||||
18 | under
this Article.
| ||||||
19 | (Source: P.A. 93-933, eff. 8-13-04; 94-356, eff. 7-29-05.)
| ||||||
20 | Section 90. The State Mandates Act is amended by adding | ||||||
21 | Section 8.31 as follows: | ||||||
22 | (30 ILCS 805/8.31 new) | ||||||
23 | Sec. 8.31. Exempt mandate. Notwithstanding Sections 6 and 8 | ||||||
24 | of this Act, no reimbursement by the State is required for the |
| |||||||
| |||||||
1 | implementation of any mandate created by this amendatory Act of | ||||||
2 | the 95th General Assembly.
| ||||||
3 | Section 99. Effective date. This Act takes effect upon | ||||||
4 | becoming law.
|