103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB1632

 

Introduced 2/8/2023, by Sen. Robert F. Martwick

 

SYNOPSIS AS INTRODUCED:
 
See Index

    Amends the Chicago Police Article of the Illinois Pension Code. Provides that for Tier 2 policemen, "final average salary" is the greater of: (i) the average monthly salary obtained by dividing the total salary of the policeman during the 96 consecutive months of service within the last 120 months of service in which the total salary was the highest; or (ii) the average monthly salary obtained by dividing the total salary of the policeman during the 48 consecutive months of service within the last 60 months of service in which the total salary was the highest. Provides that the limit on salary for all purposes under the Code for Tier 2 policemen shall annually be increased by the lesser of 3% or the annual (instead of one-half of the annual) unadjusted percentage increase in the consumer price index-u, including all previous adjustments. Provides that the surviving spouse's annuity for certain Tier 2 policemen shall be 54% of the policeman's monthly salary at the time of the policeman's death. Provides that if the deceased policeman was a parent of a child or children and there is a surviving spouse, 12% of the policeman's monthly salary at the date of death, or 12% of the policeman's earned pension, shall be granted to the guardian of any such minor child or children. Provides that upon the death of the surviving spouse leaving one or more children under the age of 18, or upon the death of a policeman leaving one or more children but no surviving spouse, a monthly pension of 20% of the policeman's monthly salary at the date of death or 20% of the policeman's earned pension at the date of death shall be granted to the guardian of each such child until the child reaches age 18. Makes other changes. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.


LRB103 27796 RPS 54174 b

STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT
MAY APPLY

 

 

A BILL FOR

 

SB1632LRB103 27796 RPS 54174 b

1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by
5changing Section 5-238 as follows:
 
6    (40 ILCS 5/5-238)
7    Sec. 5-238. Provisions applicable to new hires; Tier 2.
8    (a) Notwithstanding any other provision of this Article,
9the provisions of this Section apply to a person who first
10becomes a policeman under this Article on or after January 1,
112011, and to certain qualified survivors of such a policeman.
12Such persons, and the benefits and restrictions that apply
13specifically to them under this Article, may be referred to as
14"Tier 2".
15    (b) A policeman who has withdrawn from service, has
16attained age 50 or more, and has 10 or more years of service in
17that capacity shall be entitled, upon proper application being
18received by the Fund, to receive a Tier 2 monthly retirement
19annuity for his service as a police officer. The Tier 2 monthly
20retirement annuity shall be computed by multiplying 2.5% for
21each year of such service by his or her final average salary,
22subject to an annuity reduction factor of one-half of 1% for
23each month that the police officer's age at retirement is

 

 

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1under age 55. The Tier 2 monthly retirement annuity is in lieu
2of any age and service annuity or other form of retirement
3annuity under this Article.
4    The maximum retirement annuity under this subsection (b)
5shall be 75% of final average salary.
6    For the purposes of this subsection (b), "final average
7salary" means the greater of: (i) the average monthly salary
8obtained by dividing the total salary of the policeman during
9the 96 consecutive months of service within the last 120
10months of service in which the total salary was the highest by
11the number of months of service in that period; or (ii) the
12average monthly salary obtained by dividing the total salary
13of the policeman during the 48 consecutive months of service
14within the last 60 months of service in which the total salary
15was the highest by the number of months of service in that
16period.
17    Beginning on January 1, 2011, for all purposes under this
18Code (including without limitation the calculation of benefits
19and employee contributions), the annual salary based on the
20plan year of a member or participant to whom this Section
21applies shall not exceed $106,800; however, that amount shall
22annually thereafter be increased by the lesser of (i) 3% of
23that amount, including all previous adjustments, or (ii)
24one-half the annual unadjusted percentage increase (but not
25less than zero) in the consumer price index-u for the 12 months
26ending with the September preceding each November 1, including

 

 

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1all previous adjustments.
2    Nothing in this amendatory Act of the 103rd General
3Assembly shall cause or otherwise result in any retroactive
4adjustment of any employee contributions.
5    (c) Notwithstanding any other provision of this Article,
6for a person who first becomes a policeman under this Article
7on or after January 1, 2011, eligibility for and the amount of
8the annuity to which the qualified surviving spouse, children,
9and parents are entitled under this subsection (c) shall be
10determined as follows:
11        (1) The surviving spouse of a deceased policeman to
12    whom this Section applies shall be deemed qualified to
13    receive a Tier 2 surviving spouse's annuity under this
14    paragraph (1) if: (i) the deceased policeman meets the
15    requirements specified under subdivision (A), (B), (C), or
16    (D) of this paragraph (1); and (ii) the surviving spouse
17    would not otherwise be excluded from receiving a widow's
18    annuity under the eligibility requirements for a widow's
19    annuity set forth in Section 5-146. The Tier 2 surviving
20    spouse's annuity is in lieu of the widow's annuity
21    determined under any other Section of this Article and is
22    subject to the requirements of Section 5-147.1.
23        As used in this subsection (c), "earned annuity" means
24    a Tier 2 monthly retirement annuity determined under
25    subsection (b) of this Section, including any increases
26    the policeman had received pursuant to Section 5-167.1.

 

 

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1            (A) If the deceased policeman was receiving an
2        earned annuity at the date of his or her death, the
3        Tier 2 surviving spouse's annuity under this paragraph
4        (1) shall be in the amount of 66 2/3% of the
5        policeman's earned annuity at the date of death.
6            If the deceased policeman was a parent of a child
7        or children, including any child who has been
8        conceived but not yet born, and there is a surviving
9        spouse, 12% of the policeman's earned annuity at the
10        date of death shall be granted to the guardian of any
11        such minor child or children for each such child until
12        attainment of age 18. Upon the death of the surviving
13        spouse leaving one or more children under the age of
14        18, or upon the death of a policeman leaving one or
15        more children under the age of 18 but no surviving
16        spouse, a monthly pension of 20% of the policeman's
17        monthly salary at the date of death shall be granted to
18        the duly appointed guardian of each such child for the
19        support and maintenance of each such child until the
20        child reaches age 18. The benefit in this paragraph is
21        in lieu of a benefit under paragraph (2) of this
22        subsection (c) but does not apply if the beneficiary
23        is entitled to receive a greater benefit under
24        paragraph (2) of this subsection (c).
25            (B) If the deceased policeman was not receiving an
26        earned annuity but had at least 10 years of service at

 

 

SB1632- 5 -LRB103 27796 RPS 54174 b

1        the time of death, the Tier 2 surviving spouse's
2        annuity under this paragraph (1) shall be the greater
3        of: (i) 30% of the annual maximum salary attached to
4        the classified civil service position of a first class
5        patrolman at the time of his death; (ii) 54% of the
6        policeman's monthly salary at the time of the
7        policeman's death; or (iii) (ii) 66 2/3% of the Tier 2
8        monthly retirement annuity that the deceased policeman
9        would have been eligible to receive under subsection
10        (b) of this Section, based upon the actual service
11        accrued through the day before the policeman's death,
12        but determined as though the policeman was at least
13        age 55 on the day before his or her death and retired
14        on that day.
15            If the deceased policeman was a parent of a child
16        or children, including any child who has been
17        conceived but not yet born, and there is a surviving
18        spouse, 12% of the policeman's monthly salary at the
19        date of death shall be granted to the guardian of any
20        such minor child or children for each such child until
21        attainment of age 18. Upon the death of the surviving
22        spouse leaving one or more children under the age of
23        18, or upon the death of a policeman leaving one or
24        more children under the age of 18 but no surviving
25        spouse, a monthly pension of 20% of the policeman's
26        monthly salary at the date of death shall be granted to

 

 

SB1632- 6 -LRB103 27796 RPS 54174 b

1        the duly appointed guardian of each such child for the
2        support and maintenance of each such child until the
3        child reaches age 18. The benefit in this paragraph is
4        in lieu of a benefit under paragraph (2) of this
5        subsection (c) but does not apply if the beneficiary
6        is entitled to receive a greater benefit under
7        paragraph (2) of this subsection (c).
8            (C) If the deceased policeman was an active
9        policeman with at least 1 1/2 but less than 10 years of
10        service at the time of death, the Tier 2 surviving
11        spouse's annuity under this paragraph (1) shall be the
12        greater of: (i) in the amount of 30% of the annual
13        maximum salary attached to the classified civil
14        service position of a first class patrolman at the
15        time of his death; or (ii) 54% of the policeman's
16        monthly salary at the time of the policeman's death.
17            If the deceased policeman was a parent of a child
18        or children, including any child who has been
19        conceived but not yet born, and there is a surviving
20        spouse, 12% of the policeman's monthly salary at the
21        date of death shall be granted to the guardian of any
22        such minor child or children for each such child until
23        attainment of age 18. Upon the death of the surviving
24        spouse leaving one or more children under the age of
25        18, or upon the death of a policeman leaving one or
26        more children under the age of 18 but no surviving

 

 

SB1632- 7 -LRB103 27796 RPS 54174 b

1        spouse, a monthly pension of 20% of the policeman's
2        monthly salary at the date of death shall be granted to
3        the duly appointed guardian of each such child for the
4        support and maintenance of each such child until the
5        child reaches age 18. The benefit in this paragraph is
6        in lieu of a benefit under paragraph (2) of this
7        subsection (c) but does not apply if the beneficiary
8        is entitled to receive a greater benefit under
9        paragraph (2) of this subsection (c).
10            (D) If the performance of an act or acts of duty
11        results directly in the death of a policeman subject
12        to this Section, or prevents him from subsequently
13        resuming active service in the police department, and
14        if the policeman's Tier 2 surviving spouse would
15        otherwise meet the eligibility requirements for a
16        compensation annuity or supplemental annuity granted
17        under Section 5-144, then in addition to the Tier 2
18        surviving spouse's annuity provided under subdivision
19        (A), (B), or (C) of this paragraph (1), whichever
20        applies, the Tier 2 surviving spouse shall be
21        qualified to receive compensation annuity or
22        supplemental annuity, as would be provided under
23        Section 5-144, in order to bring the total benefit up
24        to the applicable 75% salary limitation provided in
25        that Section, but subject to the Tier 2 salary cap
26        provided under subsection (b) of this Section; except

 

 

SB1632- 8 -LRB103 27796 RPS 54174 b

1        that no such annuity shall be paid to the surviving
2        spouse of a policeman who dies while in receipt of
3        disability benefits when the policeman's death was
4        caused by an intervening illness or injury unrelated
5        to the illness or injury that had prevented him from
6        subsequently resuming active service in the police
7        department.
8            (E) Notwithstanding any other provision of this
9        Article, the monthly Tier 2 surviving spouse's annuity
10        under subdivision (A) or (B) of this paragraph (1)
11        shall be increased on the January 1 next occurring
12        after (i) attainment of age 60 by the recipient of the
13        Tier 2 surviving spouse's annuity or (ii) the first
14        anniversary of the Tier 2 surviving spouse's annuity
15        start date, whichever is later, and on each January 1
16        thereafter, by 3% or one-half the annual unadjusted
17        percentage increase (but not less than zero) in the
18        consumer price index-u for the 12 months ending with
19        the September preceding each November 1, whichever is
20        less, of the originally granted Tier 2 surviving
21        spouse's annuity. If the unadjusted percentage change
22        in the consumer price index-u for a 12-month period
23        ending in September is zero or, when compared with the
24        preceding period, decreases, then the annuity shall
25        not be increased.
26            For the purposes of this Section, "consumer price

 

 

SB1632- 9 -LRB103 27796 RPS 54174 b

1        index-u" means the index published by the Bureau of
2        Labor Statistics of the United States Department of
3        Labor that measures the average change in prices of
4        goods and services purchased by all urban consumers,
5        United States city average, all items, 1982-84 = 100.
6        The new amount resulting from each annual adjustment
7        shall be determined by the Public Pension Division of
8        the Department of Insurance and made available to the
9        boards of the pension funds.
10            (F) Notwithstanding the other provisions of this
11        paragraph (1), for a qualified surviving spouse who is
12        entitled to a Tier 2 surviving spouse's annuity under
13        subdivision (A), (B), (C), or (D) of this paragraph
14        (1), that Tier 2 surviving spouse's annuity shall not
15        be less than the amount of the minimum widow's annuity
16        established from time to time under Section 5-167.4.
17        (2) Surviving children of a deceased policeman subject
18    to this Section who would otherwise meet the eligibility
19    requirements for a child's annuity set forth in Sections
20    5-151 and 5-152 shall be deemed qualified to receive a
21    Tier 2 child's annuity under this subsection (c), which
22    shall be in lieu of, but in the same amount and paid in the
23    same manner as, the child's annuity provided under those
24    Sections; except that any salary used for computing a Tier
25    2 child's annuity shall be subject to the Tier 2 salary cap
26    provided under subsection (b) of this Section. For

 

 

SB1632- 10 -LRB103 27796 RPS 54174 b

1    purposes of determining any pro rata reduction in child's
2    annuities under this subsection (c), references in Section
3    5-152 to the combined annuities of the family shall be
4    deemed to refer to the combined Tier 2 surviving spouse's
5    annuity, if any, and the Tier 2 child's annuities payable
6    under this subsection (c).
7        (3) Surviving parents of a deceased policeman subject
8    to this Section who would otherwise meet the eligibility
9    requirements for a parent's annuity set forth in Section
10    5-152 shall be deemed qualified to receive a Tier 2
11    parent's annuity under this subsection (c), which shall be
12    in lieu of, but in the same amount and paid in the same
13    manner as, the parent's annuity provided under Section
14    5-152.1; except that any salary used for computing a Tier
15    2 parent's annuity shall be subject to the Tier 2 salary
16    cap provided under subsection (b) of this Section. For the
17    purposes of this Section, a reference to "annuity" in
18    Section 5-152.1 includes: (i) in the context of a widow, a
19    Tier 2 surviving spouse's annuity and (ii) in the context
20    of a child, a Tier 2 child's annuity.
21    Notwithstanding Section 1-103.1, the changes made to this
22subsection by this amendatory Act of the 103rd General
23Assembly apply without regard to whether the deceased
24policeman was in service on or after the effective date of this
25amendatory Act of the 103rd General Assembly. The changes made
26by this amendatory Act of the 103rd General Assembly shall not

 

 

SB1632- 11 -LRB103 27796 RPS 54174 b

1diminish the survivor's benefits described in this Section.
2    (d) The General Assembly finds and declares that the
3provisions of this Section, as enacted by Public Act 96-1495,
4require clarification relating to necessary eligibility
5standards and the manner of determining and paying the
6intended Tier 2 benefits and contributions in order to enable
7the Fund to unambiguously implement and administer benefits
8for Tier 2 members. The changes to this Section and the
9conforming changes to Sections 5-153, 5-155, 5-163, 5-167.1
10(except for the changes to subsection (a) of that Section),
115-169, and 5-170 made by this amendatory Act of the 99th
12General Assembly are enacted to clarify the provisions of this
13Section as enacted by Public Act 96-1495, and are hereby
14declared to represent and be consistent with the original and
15continuing intent of this Section and Public Act 96-1495.
16    (e) The changes to Sections 5-153, 5-155, 5-163, 5-167.1
17(except for the changes to subsection (a) of that Section),
185-169, and 5-170 made by this amendatory Act of the 99th
19General Assembly are intended to be retroactive to January 1,
202011 (the effective date of Public Act 96-1495) and, for the
21purposes of Section 1-103.1 of this Code, they apply without
22regard to whether the relevant policeman was in service on or
23after the effective date of this amendatory Act of the 99th
24General Assembly.
25(Source: P.A. 99-905, eff. 11-29-16.)
 

 

 

SB1632- 12 -LRB103 27796 RPS 54174 b

1    Section 90. The State Mandates Act is amended by adding
2Section 8.47 as follows:
 
3    (30 ILCS 805/8.47 new)
4    Sec. 8.47. Exempt mandate. Notwithstanding Sections 6 and
58 of this Act, no reimbursement by the State is required for
6the implementation of any mandate created by this amendatory
7Act of the 103rd General Assembly.
 
8    Section 99. Effective date. This Act takes effect upon
9becoming law.

 

 

SB1632- 13 -LRB103 27796 RPS 54174 b

1 INDEX
2 Statutes amended in order of appearance
3    40 ILCS 5/5-238
4    30 ILCS 805/8.47 new