Full Text of HB4960 96th General Assembly
HB4960enr 96TH GENERAL ASSEMBLY
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| AN ACT concerning public employee benefits.
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| Be it enacted by the People of the State of Illinois,
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| represented in the General Assembly:
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| Section 5. The Illinois Pension Code is amended by changing | 5 |
| Sections 7-118, 7-137, 7-172, and 7-220 as follows:
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| (40 ILCS 5/7-118) (from Ch. 108 1/2, par. 7-118)
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| Sec. 7-118. "Beneficiary" . :
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| (a) "Beneficiary" means: | 9 |
| (1) Any person or persons, trust, or charity designated | 10 |
| as a beneficiary
by an employee, former employee who has | 11 |
| not yet received a retirement annuity
or separation | 12 |
| benefit, or employee annuitant. If no designation is on | 13 |
| file or
no beneficiary so designated survives, the estate | 14 |
| of the employee, former
employee who has not yet received a | 15 |
| retirement annuity or separation benefit,
or employee | 16 |
| annuitant. | 17 |
| (2) Any person or persons, trust, or charity designated | 18 |
| as a beneficiary
by a beneficiary annuitant or, if no | 19 |
| designation is on file or no beneficiary
so designated | 20 |
| survives, the estate of the beneficiary annuitant.
The | 21 |
| surviving spouse of an employee or of an employee
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| annuitant, or if no surviving spouse survives, the person | 23 |
| or persons
designated by a participating employee or |
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| employee annuitant, or if no
person so designated survives, | 2 |
| or if no designation is on file, the
estate of the employee | 3 |
| or employee annuitant. The person or persons
designated by | 4 |
| a beneficiary annuitant, or if no person designated
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| survives, or if no designation is on file, the estate of | 6 |
| the beneficiary
annuitant. | 7 |
| (3) The estate of a surviving spouse annuitant where | 8 |
| the employee
or employee annuitant filed no designation, or | 9 |
| no person designated
survives at the death of a surviving | 10 |
| spouse annuitant. | 11 |
| (b) Designations of
beneficiaries shall be in writing on | 12 |
| forms prescribed by the board and
effective upon filing in the | 13 |
| fund offices. The designation forms shall
provide for | 14 |
| contingent beneficiaries. Divorce, dissolution or annulment
of | 15 |
| marriage revokes the designation of an employee's former spouse | 16 |
| as a
beneficiary on a designation executed before entry of | 17 |
| judgment for divorce,
dissolution or annulment of marriage.
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| (b) Notwithstanding the foregoing, an employee, former | 19 |
| employee who has
not yet received a retirement annuity or | 20 |
| separation benefit, or employee
annuitant may elect to name any | 21 |
| person, trust or charity to be the
primary beneficiary of any | 22 |
| death benefit payable by reason of his death. Such
election | 23 |
| shall state specifically whether it is his intention to exclude | 24 |
| the
spouse, shall be in writing, and may be revoked at any | 25 |
| time. Such election or
revocation shall take effect upon being | 26 |
| filed in the fund offices.
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| (c) If a surviving spouse annuity is payable to a former | 2 |
| spouse upon
the death of an employee annuitant, the former | 3 |
| spouse, unless designated by
the employee annuitant after | 4 |
| dissolution of the marriage, shall not be the
beneficiary for | 5 |
| the purposes of the $3,000 death benefit
payable under | 6 |
| subparagraph 6 of Section 7-164. This benefit shall be paid
to | 7 |
| the designated beneficiary of the employee annuitant or, if | 8 |
| there is no
designation, then to the estate of the employee | 9 |
| annuitant.
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| (Source: P.A. 89-136, eff. 7-14-95; 90-448, eff. 8-16-97.)
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| (40 ILCS 5/7-137) (from Ch. 108 1/2, par. 7-137)
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| Sec. 7-137. Participating and covered employees.
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| (a) The persons described in this paragraph (a) shall be | 14 |
| included within
and be subject to this Article and eligible to | 15 |
| benefits from this fund,
beginning upon the dates hereinafter | 16 |
| specified:
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| 1. Except as to the employees specifically excluded | 18 |
| under the
provisions of this Article, all persons who are | 19 |
| employees of any
municipality (or instrumentality thereof) | 20 |
| or participating
instrumentality on the effective date of | 21 |
| participation of the
municipality or participating | 22 |
| instrumentality beginning upon such
effective date.
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| 2. Except as to the employees specifically excluded | 24 |
| under the
provisions of this Article, all persons, who | 25 |
| became employees of any
participating municipality (or |
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| instrumentality thereof) or participating
instrumentality | 2 |
| after the effective date of participation of such
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| municipality or participating instrumentality, beginning | 4 |
| upon the date
such person becomes an employee.
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| 3. All persons who file notice with the board as | 6 |
| provided in
paragraph (b) 2 and 3 of this Section, | 7 |
| beginning upon the date of filing
such notice.
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| (b) The following described persons shall not be considered
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| participating employees eligible for benefits from this fund, | 10 |
| but shall
be included within and be subject to this Article | 11 |
| (each of the
descriptions is not exclusive but is cumulative):
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| 1. Any person who occupies an office or is employed in | 13 |
| a position
normally requiring performance of duty during | 14 |
| less than 600 hours a year
for a municipality (including | 15 |
| all instrumentalities thereof) or a
participating | 16 |
| instrumentality. If a school treasurer performs services
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| for more than one school district, the total number of | 18 |
| hours of service
normally required for the several school | 19 |
| districts shall be considered
to determine whether he | 20 |
| qualifies under this paragraph;
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| 2. Any person who holds elective office unless he has | 22 |
| elected while
in that office in a written notice on file | 23 |
| with the board to become a
participating employee;
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| 3. Any person working for a city hospital unless any | 25 |
| such person,
while in active employment, has elected in a | 26 |
| written notice on file with
the board to become a |
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| participating employee and notification thereof is
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| received by the board;
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| 4. Any person who becomes an employee after June 30, | 4 |
| 1979 as a public
service employment program participant | 5 |
| under the federal Comprehensive
Employment and Training | 6 |
| Act and whose wages or fringe benefits are paid in
whole or | 7 |
| in part by funds provided under such Act;
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| 5. Any person who is actively employed by a | 9 |
| municipality on its effective date of participation in the | 10 |
| Fund if that municipality (i) has at least 35 employees on | 11 |
| its effective date of participation; (ii) is located in a | 12 |
| county with at least 2,000,000 inhabitants; and (iii) | 13 |
| maintains an independent defined benefit pension plan for | 14 |
| the benefit of its eligible employees, unless the person | 15 |
| files with the board within 90 days after the | 16 |
| municipality's effective date of participation an | 17 |
| irrevocable election to participate.
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| (c) Any person electing to be a participating employee, | 19 |
| pursuant to
paragraph (b) of this Section may not change such | 20 |
| election,
except as provided in Section 7-137.1.
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| (d) Any employee who occupied the position of school nurse | 22 |
| in any
participating municipality on August 8, 1961 and | 23 |
| continuously thereafter
until the effective date of the | 24 |
| exercise of the option authorized by
this subparagraph, who on | 25 |
| August 7, 1961 was a member of the Teachers'
Retirement System | 26 |
| of Illinois, by virtue of certification by the
Department of |
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| Registration and Education as a public health nurse, may
elect | 2 |
| to terminate participation in this Fund in order to | 3 |
| re-establish
membership in such System. The election may be | 4 |
| exercised by filing
written notice thereof with the Board or | 5 |
| with the Board of Trustees of
said Teachers' Retirement System, | 6 |
| not later than September 30, 1963, and
shall be effective on | 7 |
| the first day of the calendar month next following
the month in | 8 |
| which the notice was filed. If the written notice is filed
with | 9 |
| such Teachers' Retirement System, that System shall | 10 |
| immediately
notify this Fund, but neither failure nor delay in | 11 |
| notification shall
affect the validity of the employee's | 12 |
| election. If the option is
exercised, the Fund shall notify | 13 |
| such Teachers' Retirement System of
such fact and transfer to | 14 |
| that system the amounts contributed by the
employee to this | 15 |
| Fund, including interest at 3% per annum, but excluding
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| contributions applicable to social security coverage during | 17 |
| the period
beginning August 8, 1961 to the effective date of | 18 |
| the employee's
election. Participation in this Fund as to any | 19 |
| credits on or after
August 8, 1961 and up to the effective date | 20 |
| of the employee's election
shall terminate on such effective | 21 |
| date.
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| (e) Any participating municipality or participating | 23 |
| instrumentality,
other than a school district or special | 24 |
| education joint agreement created
under Section 10-22.31 of the | 25 |
| School Code, may, by a resolution or
ordinance duly adopted by | 26 |
| its governing body, elect to exclude from
participation and |
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| eligibility for benefits all persons who are employed
after the | 2 |
| effective date of such resolution or ordinance and who occupy | 3 |
| an
office or are employed in a position normally requiring | 4 |
| performance of duty
for less than 1000 hours per year for the | 5 |
| participating municipality
(including all instrumentalities | 6 |
| thereof) or participating instrumentality
except for persons | 7 |
| employed in a position normally requiring performance of
duty | 8 |
| for 600 hours or more per year (i) by such participating | 9 |
| municipality
or participating instrumentality prior to the | 10 |
| effective date of the
resolution or ordinance and , (ii) by any | 11 |
| participating municipality or
participating instrumentality | 12 |
| prior to January 1, 1982 and (iii) by a
participating | 13 |
| municipality or participating instrumentality, which had not
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| adopted such a resolution when the person was employed, and the | 15 |
| function
served by the employee's position is assumed by | 16 |
| another participating
municipality or participating | 17 |
| instrumentality. A participating municipality or
participating | 18 |
| instrumentality included in and subject to this Article after
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| January 1, 1982 may adopt such resolution or ordinance only | 20 |
| prior to the
date it becomes included in and subject to this | 21 |
| Article. Notwithstanding
the foregoing, a participating | 22 |
| municipality or participating
instrumentality which is formed | 23 |
| solely to succeed to the functions of a
participating | 24 |
| municipality or participating instrumentality shall be
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| considered to have adopted any such resolution or ordinance | 26 |
| which may have
been applicable to the employees performing such |
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| functions. The election
made by the resolution or ordinance | 2 |
| shall take effect at the time specified
in the resolution or | 3 |
| ordinance, and once effective shall be irrevocable.
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| (Source: P.A. 93-933, eff. 8-13-04.)
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| (40 ILCS 5/7-172) (from Ch. 108 1/2, par. 7-172)
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| Sec. 7-172. Contributions by participating municipalities | 7 |
| and
participating instrumentalities.
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| (a) Each participating municipality and each participating
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| instrumentality shall make payment to the fund as follows:
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| 1. municipality contributions in an amount determined | 11 |
| by applying
the municipality contribution rate to each | 12 |
| payment of earnings paid to
each of its participating | 13 |
| employees;
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| 2. an amount equal to the employee contributions | 15 |
| provided by paragraphs
(a) and (b) of Section 7-173, | 16 |
| whether or not the employee contributions are
withheld as | 17 |
| permitted by that Section;
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| 3. all accounts receivable, together with interest | 19 |
| charged thereon,
as provided in Section 7-209;
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| 4. if it has no participating employees with current | 21 |
| earnings, an
amount payable which, over a closed period of | 22 |
| 20 years for participating municipalities and 10 years for | 23 |
| participating instrumentalities beginning with the year
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| following an award of benefit , will amortize, at the | 25 |
| effective rate for
that year, any unfunded obligation. The |
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| unfunded obligation shall be computed as provided in | 2 |
| paragraph 2 of subsection (b); negative balance in its | 3 |
| municipality reserve resulting
from the award. This amount | 4 |
| when established will be payable as a
separate contribution | 5 |
| whether or not it later has participating employees. | 6 |
| 5. if it has fewer than 7 participating employees or a | 7 |
| negative balance in its municipality reserve, the greater | 8 |
| of (A) an amount payable that, over a period of 20 years, | 9 |
| will amortize at the effective rate for that year any | 10 |
| unfunded obligation, computed as provided in paragraph 2 of | 11 |
| subsection (b) or (B) the amount required by paragraph 1 of | 12 |
| this subsection (a).
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| (b) A separate municipality contribution rate shall be | 14 |
| determined
for each calendar year for all participating | 15 |
| municipalities together
with all instrumentalities thereof. | 16 |
| The municipality contribution rate
shall be determined for | 17 |
| participating instrumentalities as if they were
participating | 18 |
| municipalities. The municipality contribution rate shall
be | 19 |
| the sum of the following percentages:
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| 1. The percentage of earnings of all the participating | 21 |
| employees of all
participating municipalities and | 22 |
| participating instrumentalities which, if paid
over the | 23 |
| entire period of their service, will be sufficient when | 24 |
| combined with
all employee contributions available for the | 25 |
| payment of benefits, to provide
all annuities for | 26 |
| participating employees, and the $3,000 death benefit
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| payable under Sections 7-158 and 7-164, such percentage to | 2 |
| be known as the
normal cost rate.
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| 2. The percentage of earnings of the participating | 4 |
| employees of each
participating municipality and | 5 |
| participating instrumentalities necessary
to adjust for | 6 |
| the difference between the present value of all benefits,
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| excluding temporary and total and permanent disability and | 8 |
| death benefits, to
be provided for its participating | 9 |
| employees and the sum of its accumulated
municipality | 10 |
| contributions and the accumulated employee contributions | 11 |
| and the
present value of expected future employee and | 12 |
| municipality contributions
pursuant to subparagraph 1 of | 13 |
| this paragraph (b). This adjustment shall be
spread over | 14 |
| the remainder of the period that is allowable under | 15 |
| generally
accepted accounting principles.
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| 3. The percentage of earnings of the participating | 17 |
| employees of all
municipalities and participating | 18 |
| instrumentalities necessary to provide
the present value | 19 |
| of all temporary and total and permanent disability
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| benefits granted during the most recent year for which | 21 |
| information is
available.
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| 4. The percentage of earnings of the participating | 23 |
| employees of all
participating municipalities and | 24 |
| participating instrumentalities
necessary to provide the | 25 |
| present value of the net single sum death
benefits expected | 26 |
| to become payable from the reserve established under
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| Section 7-206 during the year for which this rate is fixed.
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| 5. The percentage of earnings necessary to meet any | 3 |
| deficiency
arising in the Terminated Municipality Reserve.
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| (c) A separate municipality contribution rate shall be | 5 |
| computed for
each participating municipality or participating | 6 |
| instrumentality
for its sheriff's law enforcement employees.
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| A separate municipality contribution rate shall be | 8 |
| computed for the
sheriff's law enforcement employees of each | 9 |
| forest preserve district that
elects to have such employees. | 10 |
| For the period from January 1, 1986 to
December 31, 1986, such | 11 |
| rate shall be the forest preserve district's regular
rate plus | 12 |
| 2%.
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| In the event that the Board determines that there is an | 14 |
| actuarial
deficiency in the account of any municipality with | 15 |
| respect to a person who
has elected to participate in the Fund | 16 |
| under Section 3-109.1 of this Code,
the Board may adjust the | 17 |
| municipality's contribution rate so as to make up
that | 18 |
| deficiency over such reasonable period of time as the Board may | 19 |
| determine.
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| (d) The Board may establish a separate municipality | 21 |
| contribution
rate for all employees who are program | 22 |
| participants employed under the
federal Comprehensive | 23 |
| Employment Training Act by all of the
participating | 24 |
| municipalities and instrumentalities. The Board may also
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| provide that, in lieu of a separate municipality rate for these
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| employees, a portion of the municipality contributions for such |
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| program
participants shall be refunded or an extra charge | 2 |
| assessed so that the
amount of municipality contributions | 3 |
| retained or received by the fund
for all CETA program | 4 |
| participants shall be an amount equal to that which
would be | 5 |
| provided by the separate municipality contribution rate for all
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| such program participants. Refunds shall be made to prime | 7 |
| sponsors of
programs upon submission of a claim therefor and | 8 |
| extra charges shall be
assessed to participating | 9 |
| municipalities and instrumentalities. In
establishing the | 10 |
| municipality contribution rate as provided in paragraph
(b) of | 11 |
| this Section, the use of a separate municipality contribution
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| rate for program participants or the refund of a portion of the
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| municipality contributions, as the case may be, may be | 14 |
| considered.
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| (e) Computations of municipality contribution rates for | 16 |
| the
following calendar year shall be made prior to the | 17 |
| beginning of each
year, from the information available at the | 18 |
| time the computations are
made, and on the assumption that the | 19 |
| employees in each participating
municipality or participating | 20 |
| instrumentality at such time will continue
in service until the | 21 |
| end of such calendar year at their respective rates
of earnings | 22 |
| at such time.
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| (f) Any municipality which is the recipient of State | 24 |
| allocations
representing that municipality's contributions for | 25 |
| retirement annuity
purposes on behalf of its employees as | 26 |
| provided in Section 12-21.16 of
the Illinois Public Aid Code |
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| shall pay the allocations so
received to the Board for such | 2 |
| purpose. Estimates of State allocations to
be received during | 3 |
| any taxable year shall be considered in the
determination of | 4 |
| the municipality's tax rate for that year under Section
7-171. | 5 |
| If a special tax is levied under Section 7-171, none of the
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| proceeds may be used to reimburse the municipality for the | 7 |
| amount of State
allocations received and paid to the Board. Any | 8 |
| multiple-county or
consolidated health department which | 9 |
| receives contributions from a county
under Section 11.2 of "An | 10 |
| Act in relation to establishment and maintenance
of county and | 11 |
| multiple-county health departments", approved July 9, 1943,
as | 12 |
| amended, or distributions under Section 3 of the Department of | 13 |
| Public
Health Act, shall use these only for municipality | 14 |
| contributions by the
health department.
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| (g) Municipality contributions for the several purposes | 16 |
| specified
shall, for township treasurers and employees in the | 17 |
| offices of the
township treasurers who meet the qualifying | 18 |
| conditions for coverage
hereunder, be allocated among the | 19 |
| several school districts and parts of
school districts serviced | 20 |
| by such treasurers and employees in the
proportion which the | 21 |
| amount of school funds of each district or part of
a district | 22 |
| handled by the treasurer bears to the total amount of all
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| school funds handled by the treasurer.
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| From the funds subject to allocation among districts and | 25 |
| parts of
districts pursuant to the School Code, the trustees | 26 |
| shall withhold the
proportionate share of the liability for |
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| municipality contributions imposed
upon such districts by this | 2 |
| Section, in respect to such township treasurers
and employees | 3 |
| and remit the same to the Board.
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| The municipality contribution rate for an educational | 5 |
| service center shall
initially be the same rate for each year | 6 |
| as the regional office of
education or school district
which | 7 |
| serves as its administrative agent. When actuarial data become
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| available, a separate rate shall be established as provided in | 9 |
| subparagraph
(i) of this Section.
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| The municipality contribution rate for a public agency, | 11 |
| other than a
vocational education cooperative, formed under the | 12 |
| Intergovernmental
Cooperation Act shall initially be the | 13 |
| average rate for the municipalities
which are parties to the | 14 |
| intergovernmental agreement. When actuarial data
become | 15 |
| available, a separate rate shall be established as provided in
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| subparagraph (i) of this Section.
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| (h) Each participating municipality and participating
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| instrumentality shall make the contributions in the amounts | 19 |
| provided in
this Section in the manner prescribed from time to | 20 |
| time by the Board and
all such contributions shall be | 21 |
| obligations of the respective
participating municipalities and | 22 |
| participating instrumentalities to this
fund. The failure to | 23 |
| deduct any employee contributions shall not
relieve the | 24 |
| participating municipality or participating instrumentality
of | 25 |
| its obligation to this fund. Delinquent payments of | 26 |
| contributions
due under this Section may, with interest, be |
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| recovered by civil action
against the participating | 2 |
| municipalities or participating
instrumentalities. | 3 |
| Municipality contributions, other than the amount
necessary | 4 |
| for employee contributions and Social Security contributions, | 5 |
| for
periods of service by employees from whose earnings no | 6 |
| deductions were made
for employee contributions to the fund, | 7 |
| may be charged to the municipality
reserve for the municipality | 8 |
| or participating instrumentality.
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| (i) Contributions by participating instrumentalities shall | 10 |
| be
determined as provided herein except that the percentage | 11 |
| derived under
subparagraph 2 of paragraph (b) of this Section, | 12 |
| and the amount payable
under subparagraph 5 of paragraph (a) of | 13 |
| this Section, shall be based on
an amortization period of 10 | 14 |
| years.
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| (j) Notwithstanding the other provisions of this Section, | 16 |
| the additional unfunded liability accruing as a result of this | 17 |
| amendatory Act of the 94th General Assembly
shall be amortized | 18 |
| over a period of 30 years beginning on January 1 of the
second | 19 |
| calendar year following the calendar year in which this | 20 |
| amendatory Act takes effect, except that the employer may | 21 |
| provide for a longer amortization period by adopting a | 22 |
| resolution or ordinance specifying a 35-year or 40-year period | 23 |
| and submitting a certified copy of the ordinance or resolution | 24 |
| to the fund no later than June 1 of the calendar year following | 25 |
| the calendar year in which this amendatory Act takes effect.
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| (Source: P.A. 94-712, eff. 6-1-06 .)
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| (40 ILCS 5/7-220) (from Ch. 108 1/2, par. 7-220)
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| Sec. 7-220. Administrative review. The provisions of the | 3 |
| Administrative Review Law, and all amendments and
| 4 |
| modifications thereof and the rules adopted
pursuant thereto | 5 |
| shall apply to and govern all proceedings for the judicial
| 6 |
| review of final administrative decisions of the retirement | 7 |
| board provided
for under this Article. The term "administrative | 8 |
| decision" is as defined in
Section 3-101 of the Code of Civil | 9 |
| Procedure. The venue for actions brought under the | 10 |
| Administrative Review Law shall be any county in which the | 11 |
| Board maintains an office or the county in which the member's | 12 |
| plaintiff's employing participating municipality or | 13 |
| participating instrumentality has its main office.
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| (Source: P.A. 82-783.)
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| Section 90. The State Mandates Act is amended by adding | 16 |
| Section 8.34 as follows: | 17 |
| (30 ILCS 805/8.34 new) | 18 |
| Sec. 8.34. Exempt mandate. Notwithstanding Sections 6 and 8 | 19 |
| of this Act, no reimbursement by the State is required for the | 20 |
| implementation of any mandate created by this amendatory Act of | 21 |
| the 96th General Assembly.
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| Section 99. Effective date. This Act takes effect upon | 23 |
| becoming law.
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