Sen. Don Harmon

Filed: 5/8/2012

 

 


 

 


 
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1
AMENDMENT TO HOUSE BILL 1605

2    AMENDMENT NO. ______. Amend House Bill 1605 AS AMENDED, by
3replacing everything after the enacting clause with the
4following:
 
5    "Section 5. The Illinois Pension Code is amended by
6changing Sections 1-160, 3-106, 3-124.1, 4-106, 4-117, and
77-144 and by adding Sections 3-124.3, 4-117.2, and 7-144.1 as
8follows:
 
9    (40 ILCS 5/1-160)
10    Sec. 1-160. Provisions applicable to new hires.
11    (a) The provisions of this Section apply to a person who,
12on or after January 1, 2011, first becomes a member or a
13participant under any reciprocal retirement system or pension
14fund established under this Code, other than a retirement
15system or pension fund established under Article 2, 3, 4, 5, 6,
16or 18 of this Code, notwithstanding any other provision of this

 

 

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1Code to the contrary, but do not apply to any self-managed plan
2established under this Code, to any person with respect to
3service as a sheriff's law enforcement employee under Article
47, or to any participant of the retirement plan established
5under Section 22-101.
6    (b) "Final average salary" means the average monthly (or
7annual) salary obtained by dividing the total salary or
8earnings calculated under the Article applicable to the member
9or participant during the 96 consecutive months (or 8
10consecutive years) of service within the last 120 months (or 10
11years) of service in which the total salary or earnings
12calculated under the applicable Article was the highest by the
13number of months (or years) of service in that period. For the
14purposes of a person who first becomes a member or participant
15of any retirement system or pension fund to which this Section
16applies on or after January 1, 2011, in this Code, "final
17average salary" shall be substituted for the following:
18        (1) In Articles 7 (except for service as sheriff's law
19    enforcement employees) and 15, "final rate of earnings".
20        (2) In Articles 8, 9, 10, 11, and 12, "highest average
21    annual salary for any 4 consecutive years within the last
22    10 years of service immediately preceding the date of
23    withdrawal".
24        (3) In Article 13, "average final salary".
25        (4) In Article 14, "final average compensation".
26        (5) In Article 17, "average salary".

 

 

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1        (6) In Section 22-207, "wages or salary received by him
2    at the date of retirement or discharge".
3    (b-5) Beginning on January 1, 2011, for all purposes under
4this Code (including without limitation the calculation of
5benefits and employee contributions), the annual earnings,
6salary, or wages (based on the plan year) of a member or
7participant to whom this Section applies shall not exceed
8$106,800; however, that amount shall annually thereafter be
9increased by the lesser of (i) 3% of that amount, including all
10previous adjustments, or (ii) one-half the annual unadjusted
11percentage increase (but not less than zero) in the consumer
12price index-u for the 12 months ending with the September
13preceding each November 1, including all previous adjustments.
14    For the purposes of this Section, "consumer price index-u"
15means the index published by the Bureau of Labor Statistics of
16the United States Department of Labor that measures the average
17change in prices of goods and services purchased by all urban
18consumers, United States city average, all items, 1982-84 =
19100. The new amount resulting from each annual adjustment shall
20be determined by the Public Pension Division of the Department
21of Insurance and made available to the boards of the retirement
22systems and pension funds by November 1 of each year.
23    (c) A member or participant is entitled to a retirement
24annuity upon written application if he or she has attained age
2567 and has at least 10 years of service credit and is otherwise
26eligible under the requirements of the applicable Article.

 

 

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1    A member or participant who has attained age 62 and has at
2least 10 years of service credit and is otherwise eligible
3under the requirements of the applicable Article may elect to
4receive the lower retirement annuity provided in subsection (d)
5of this Section.
6    (d) The retirement annuity of a member or participant who
7is retiring after attaining age 62 with at least 10 years of
8service credit shall be reduced by one-half of 1% for each full
9month that the member's age is under age 67.
10    (e) Any retirement annuity or supplemental annuity shall be
11subject to annual increases on the January 1 occurring either
12on or after the attainment of age 67 or the first anniversary
13of the annuity start date, whichever is later. Each annual
14increase shall be calculated at 3% or one-half the annual
15unadjusted percentage increase (but not less than zero) in the
16consumer price index-u for the 12 months ending with the
17September preceding each November 1, whichever is less, of the
18originally granted retirement annuity. If the annual
19unadjusted percentage change in the consumer price index-u for
20the 12 months ending with the September preceding each November
211 is zero or there is a decrease, then the annuity shall not be
22increased.
23    (f) The initial survivor's or widow's annuity of an
24otherwise eligible survivor or widow of a retired member or
25participant who first became a member or participant on or
26after January 1, 2011 shall be in the amount of 66 2/3% of the

 

 

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1retired member's or participant's retirement annuity at the
2date of death. In the case of the death of a member or
3participant who has not retired and who first became a member
4or participant on or after January 1, 2011, eligibility for a
5survivor's or widow's annuity shall be determined by the
6applicable Article of this Code. The initial benefit shall be
766 2/3% of the earned annuity without a reduction due to age. A
8child's annuity of an otherwise eligible child shall be in the
9amount prescribed under each Article if applicable. Any
10survivor's or widow's annuity shall be increased (1) on each
11January 1 occurring on or after the commencement of the annuity
12if the deceased member died while receiving a retirement
13annuity or (2) in other cases, on each January 1 occurring
14after the first anniversary of the commencement of the annuity.
15Each annual increase shall be calculated at 3% or one-half the
16annual unadjusted percentage increase (but not less than zero)
17in the consumer price index-u for the 12 months ending with the
18September preceding each November 1, whichever is less, of the
19originally granted survivor's annuity. If the annual
20unadjusted percentage change in the consumer price index-u for
21the 12 months ending with the September preceding each November
221 is zero or there is a decrease, then the annuity shall not be
23increased.
24    (g) The benefits in Section 14-110 apply only if the person
25is a State policeman, a fire fighter in the fire protection
26service of a department, or a security employee of the

 

 

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1Department of Corrections or the Department of Juvenile
2Justice, as those terms are defined in subsection (b) of
3Section 14-110. A person who meets the requirements of this
4Section is entitled to an annuity calculated under the
5provisions of Section 14-110, in lieu of the regular or minimum
6retirement annuity, only if the person has withdrawn from
7service with not less than 20 years of eligible creditable
8service and has attained age 60, regardless of whether the
9attainment of age 60 occurs while the person is still in
10service.
11    (h) If a person who first becomes a member or a participant
12of a retirement system or pension fund subject to this Section
13on or after January 1, 2011 is receiving a retirement annuity
14or retirement pension under that system or fund and becomes a
15member or participant under any other system or fund created by
16this Code and is employed on a full-time basis, except for
17those members or participants exempted from the provisions of
18this Section under subsection (a) of this Section, then the
19person's retirement annuity or retirement pension under that
20system or fund shall be suspended during that employment. Upon
21termination of that employment, the person's retirement
22annuity or retirement pension payments shall resume and be
23recalculated if recalculation is provided for under the
24applicable Article of this Code.
25    If a person who first becomes a member of a retirement
26system or pension fund subject to this Section on or after

 

 

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1January 1, 2012 and is receiving a retirement annuity or
2retirement pension under that system or fund and accepts on a
3contractual basis a position to provide services to a
4governmental entity from which he or she has retired, then that
5person's annuity or retirement pension earned as an active
6employee of the employer shall be suspended during that
7contractual service. A person receiving an annuity or
8retirement pension under this Code shall notify the pension
9fund or retirement system from which he or she is receiving an
10annuity or retirement pension, as well as his or her
11contractual employer, of his or her retirement status before
12accepting contractual employment. A person who fails to submit
13such notification shall be guilty of a Class A misdemeanor and
14required to pay a fine of $1,000. Upon termination of that
15contractual employment, the person's retirement annuity or
16retirement pension payments shall resume and, if appropriate,
17be recalculated under the applicable provisions of this Code.
18    This subsection (h) shall not affect any person receiving a
19retirement annuity under the fund created by Article 7 of this
20Code who accepts a position described in Section 7-144.1 of
21this Code.
22    (i) Notwithstanding any other provision of this Section, a
23person who first becomes a participant of the retirement system
24established under Article 15 on or after January 1, 2011 shall
25have the option to enroll in the self-managed plan created
26under Section 15-158.2 of this Code.

 

 

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1    (j) In the case of a conflict between the provisions of
2this Section and any other provision of this Code, the
3provisions of this Section shall control.
4(Source: P.A. 96-889, eff. 1-1-11; 96-1490, eff. 1-1-11;
597-609, eff. 1-1-12.)
 
6    (40 ILCS 5/3-106)  (from Ch. 108 1/2, par. 3-106)
7    Sec. 3-106. Police officer, officer. "Police officer" or
8"officer": Any person who (1) is appointed to the police force
9of a police department and sworn and commissioned to perform
10police duties; and (2) within 3 months after receiving his or
11her first appointment and, if reappointed, within 3 months
12thereafter, or as otherwise provided in Section 3-109, makes
13written application to the board to come under the provisions
14of this Article.
15    Police officers serving initial probationary periods, if
16otherwise eligible, shall be police officers within the meaning
17of this Section.
18    Any person employed as the chief of police, deputy chief of
19police, superintendent of a police department or deputy
20superintendent of a police department shall be a police officer
21within the meaning of this Section.
22    
23(Source: P.A. 89-52, eff. 6-30-95.)
 
24    (40 ILCS 5/3-124.1)  (from Ch. 108 1/2, par. 3-124.1)

 

 

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1    Sec. 3-124.1. Re-entry into active service.
2    (a) If a police officer who is receiving pension payments
3other than as provided in Section 3-109.3 or Section 3-124.3
4re-enters active service, pension payment shall be suspended
5while he or she is in service. When he or she again retires,
6pension payments shall be resumed. If the police officer
7remains in service after re-entry for a period of less than 5
8years, the pension shall be the same as upon first retirement.
9If the officer's service after re-entry is at least 5 years and
10the officer makes the required contributions during the period
11of re-entry, his or her pension shall be recomputed by taking
12into account the additional period of service and salary.
13    (b) A retired police officer who accepts temporary
14employment for a period not exceeding 75 working days in any
15calendar year is not considered to make a re-entry into active
16service within the meaning of this Section. Any part of a day
17on temporary employment is considered a full day of employment.
18Employee contributions under Section 3-125.1 shall not be
19deducted nor shall creditable service time be granted during
20the period of temporary employment.
21(Source: P.A. 91-939, eff. 2-1-01.)
 
22    (40 ILCS 5/3-124.3 new)
23    Sec. 3-124.3. Pension payments during contractual return
24to active service.
25    (a) Notwithstanding any other provisions of this Code, if a

 

 

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1police officer receiving pension payments accepts on a
2contractual basis a position to provide services to a
3municipality from which he or she has retired, then that police
4officer shall continue to receive the pension payments earned
5during active service, provided:
6        (1) he or she is at least age 55 and has at least 30
7    years of service;
8        (2) his or her annual salary during the period of
9    contractual service is not more than 50% of his or her
10    salary from the last 12 months preceding retirement; and
11        (3) his or her salary did not increase by more than 10%
12    per year during the 2 years preceding retirement.
13    (b) The municipality shall pay to the pension fund an
14amount equal to 14% of the annual salary of the police officer
15during each calendar year, or portion thereof, that he or she
16is performing contractual service as described in subsection
17(a).
18    (c) Except as set forth in subsection (b) of this Section,
19no employer contribution shall be required from a municipality
20for any police officer providing contractual service as
21described in subsection (a) of this Section. No contribution
22shall be required pursuant to Section 3-125.1 from any police
23officer performing contractual service as described in
24subsection (a) of this Section.
25    (d) The period of contractual service described in
26subsection (a) of this Section shall not provide a basis for

 

 

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1the recomputation of the police officer's pension.
 
2    (40 ILCS 5/4-106)  (from Ch. 108 1/2, par. 4-106)
3    Sec. 4-106. Firefighter, firefighters. "Firefighter,
4firefighters":
5    (a) In municipalities which have adopted Division 1 of
6Article 10 of the Illinois Municipal Code, any person employed
7in the municipality's fire service as a firefighter, fire
8engineer, marine engineer, fire pilot, bomb technician or scuba
9diver; and in any of these positions where such person's duties
10also include those of a firefighter as classified by the Civil
11Service Commission of that city, and whose duty is to
12participate in the work of controlling and extinguishing fires
13at the location of any such fires.
14    (b) In municipalities which are subject to Division 2.1 of
15Article 10 of the Illinois Municipal Code, any person employed
16by a city in its fire service as a firefighter, fire engineer,
17marine engineer, fire pilot, bomb technician, or scuba diver;
18and, in any of these positions whose duties also include those
19of a firefighter and are certified in the same manner as a
20firefighter in that city.
21    (c) In municipalities which are subject to neither Division
221 nor Division 2.1 of Article 10 of the Illinois Municipal
23Code, any person who would have been included as a firefighter
24under sub-paragraph (a) or (b) above except that he served as a
25de facto and not as a de jure firefighter.

 

 

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1    (d) Notwithstanding the other provisions of this Section,
2"firefighter" does not include any person who is actively
3participating in the State Universities Retirement System
4under subsection (h) of Section 15-107 with respect to the
5employment for which he or she is a participating employee in
6that System.
7    (e) This amendatory Act of 1977 does not affect persons
8covered by this Article prior to September 22, 1977.
9    (f) Any person employed by a municipality as the chief,
10deputy chief, superintendent, deputy superintendent, fire
11marshal or assistant fire marshal of the fire department shall
12be a firefighter within the meaning of this Section.
13(Source: P.A. 90-576, eff. 3-31-98.)
 
14    (40 ILCS 5/4-117)  (from Ch. 108 1/2, par. 4-117)
15    Sec. 4-117. Reentry into active service.
16    (a) Except as set forth in Section 4-117.2, if If a
17firefighter receiving pension payments reenters active
18service, pension payments shall be suspended while he or she is
19in service. If the firefighter again retires or is discharged,
20his or her monthly pension shall be resumed in the same amount
21as was paid upon first retirement or discharge unless he or she
22remained in active service 3 or more years after re-entry in
23which case the monthly pension shall be based on the salary
24attached to the firefighter's rank at the date of last
25retirement.

 

 

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1    (b) If a deferred pensioner re-enters active service, and
2again retires or is discharged from the fire service, his or
3her pension shall be based on the salary attached to the rank
4held in the fire service at the date of earlier retirement,
5unless the firefighter remains in active service for 3 or more
6years after re-entry, in which case the monthly pension shall
7be based on the salary attached to the firefighter's rank at
8the date of last retirement.
9    (c) If a pensioner or deferred pensioner re-enters or is
10recalled to active service and is thereafter injured, and the
11injury is not related to an injury for which he or she was
12previously receiving a disability pension, the 3 year service
13requirement shall not apply in order for the firefighter to
14qualify for the increased pension based on the rate of pay at
15the time of the new injury.
16    (d) A retired firefighter who accepts temporary employment
17for a period not exceeding 75 working days in any calendar year
18is not considered to make a re-entry into active service within
19the meaning of this Section. Any part of a day on temporary
20employment is considered a full day of employment. Employee
21contributions under Section 4-118.1 shall not be deducted nor
22shall creditable service time be granted during the period of
23temporary employment.
24(Source: P.A. 83-1440.)
 
25    (40 ILCS 5/4-117.2 new)

 

 

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1    Sec. 4-117.2. Pension payments during contractual return
2to active service.
3    (a) Notwithstanding any other provisions of this Code, if a
4firefighter receiving pension payments accepts on a
5contractual basis a position to provide services to a
6municipality from which he or she has retired, then that
7firefighter shall continue to receive the pension payments
8earned during active service, provided:
9        (1) he or she is at least age 55 and has at least 30
10    years of service;
11        (2) his or her annual salary during the period of
12    contractual service is not more than 50% of his or her
13    salary from the last 12 months preceding retirement; and
14        (3) his or her salary did not increase by more than 10%
15    per year during the 2 years preceding retirement.
16    (b) The municipality shall pay to the pension fund an
17amount equal to 14% of the annual salary of the firefighter
18during each calendar year, or portion thereof, that he or she
19is performing contractual service as described in subsection
20(a).
21    (c) Except as set forth in subsection (b) of this Section,
22no employer contribution shall be required from a municipality
23for any firefighter providing contractual service as described
24in subsection (a) of this Section. No contribution shall be
25required pursuant to Section 4-118.1 from any firefighter
26performing contractual service as described in subsection (a)

 

 

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1of this Section
2    (d) The period of contractual service described in
3subsection (a) of this Section shall not provide a basis for
4the recomputation of the firefighter's pension.
 
5    (40 ILCS 5/7-144)  (from Ch. 108 1/2, par. 7-144)
6    Sec. 7-144. Retirement annuities-Suspended during
7employment.
8    (a) Except as set forth in Section 7-144.1, if If any
9person receiving any annuity again becomes an employee and
10receives earnings from employment in a position requiring him,
11or entitling him to elect, to become a participating employee,
12then the annuity payable to such employee shall be suspended as
13of the 1st day of the month coincidental with or next following
14the date upon which such person becomes such an employee. Upon
15proper qualification of the participating employee payment of
16such annuity may be resumed on the 1st day of the month
17following such qualification and upon proper application
18therefor. The participating employee in such case shall be
19entitled to a supplemental annuity arising from service and
20credits earned subsequent to such re-entry as a participating
21employee.
22    (b) Supplemental annuities to persons who return to service
23for less than 48 months shall be computed under the provisions
24of Sections 7-141, 7-142 and 7-143. In determining whether an
25employee is eligible for an annuity which requires a minimum

 

 

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1period of service, his entire period of service shall be taken
2into consideration but the supplemental annuity shall be based
3on earnings and service in the supplemental period only. The
4effective date of the suspended and supplemental annuity for
5the purpose of increases after retirement shall be considered
6to be the effective date of the suspended annuity.
7    (c) Supplemental annuities to persons who return to service
8for 48 months or more shall be a monthly amount determined as
9follows:
10        (1) An amount shall be computed under subparagraph b of
11    paragraph (1) of subsection (a) of Section 7-142,
12    considering all of the service credits of the employee;
13        (2) The actuarial value in monthly payments for life of
14    the annuity payments made before suspension shall be
15    determined and subtracted from the amount determined in (1)
16    above;
17        (3) The monthly amount of the suspended annuity, with
18    any applicable increases after retirement computed from
19    the effective date to the date of reinstatement, shall be
20    subtracted from the amount determined in (2) above and the
21    remainder shall be the amount of the supplemental annuity
22    provided that this amount shall not be less than the amount
23    computed under subsection (b) of this Section.
24        (4) The suspended annuity shall be reinstated at an
25    amount including any increases after retirement from the
26    effective date to date of reinstatement.

 

 

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1        (5) The effective date of the combined suspended and
2    supplemental annuities for the purposes of increases after
3    retirement shall be considered to be the effective date of
4    the supplemental annuity.
5(Source: P.A. 97-328, eff. 8-12-11; 97-609, eff. 1-1-12.)
 
6    (40 ILCS 5/7-144.1 new)
7    Sec. 7-144.1. Retirement annuities - Payable during
8contractual return to service.
9    (a) Notwithstanding any other provisions of this Code, if
10any person receiving a retirement annuity accepts on a
11contractual basis a position to provide services to a
12participating municipality or participating instrumentality
13from which he or she has retired, then that person shall
14continue to receive the retirement annuity earned as an active
15employee, provided:
16        (1) he or she is at least age 55 and has at least 30
17    years of service;
18        (2) his or her annual earnings during the period of
19    contractual service are not more than 50% of his or her
20    earnings from the last 12 months preceding separation from
21    service of all participating municipalities and
22    instrumentalities thereof and participating
23    instrumentalities; and
24        (3) his or her earnings did not increase by more than
25    10% per year during the 2 years preceding separation from

 

 

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1    service of all participating municipalities and
2    instrumentalities thereof and participating
3    instrumentalities.
4    (b) The participating municipality or participating
5instrumentality shall pay to the Fund an amount equal to 14% of
6the annual earnings of the person during each calendar year, or
7portion thereof, that he or she is performing contractual
8service as described in subsection (a).
9     (c) No contribution shall be required from a participating
10municipality or participating instrumentality pursuant to
11Section 7-172 for any person performing contractual service as
12described in subsection (a) of this Section. No contribution
13shall be required pursuant to Section 7-173 from any person
14performing contractual service as described in subsection (a)
15of this Section.
16    (d) No person shall be eligible for a supplemental annuity
17based on a period of contractual service described in
18subsection (a) of this Section.".